Committee for the Abolition of Illegitimate Debt

In order to promote unity of action, the CADTM proposes that a common call to this counter-summit be drafted. It is addressed to all movements wishing to join forces in defence of humanity

To visit the counter-summit website, with all the latest informations, click here.

The Annual Meetings of the World Bank World Bank
WB The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

Group (WBG) and the International Monetary Fund IMF
International Monetary Fund Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org (IMF) will be held from 9 to 15 October 2023 in Marrakech, Morocco.
The IMF is taking centre stage as the multi-faceted crisis that has affected the world since 2020 deepens. It has signed credit agreements with around 100 governments over the past three years. In each of these agreements the IMF demands the continuation of neoliberal policies. At the same time a new debt crisis is developing. It is high time to react.

Established in 1944, the IMF and the World Bank meet mainly in Washington and every three years they meet in a member country other than the United States. Since 1947, the General Meetings of these two institutions have been held only once in Africa, in Nairobi, Kenya, in 1973. The choice of Morocco is no accident. This country is considered by Washington and its allies as a good pupil because its government systematically applies the neo-liberal credo of the two institutions and because it supports the inhumane policy of the European Union in terms of migration and asylum.

The international CADTM network (Committee for the Abolition of Illegitimate Debts) will mobilize to actively contribute to making other voices from around the world heard at these WBG and IMF Assemblies, which bring together finance ministers and central bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

ECB : http://www.bankofengland.co.uk/Pages/home.aspx governors from 189 member countries, as well as representatives from the private sector, academia and NGOs. We propose the organization of a world counter-summit of social movements against these assemblies.

In order to promote unity of action, the CADTM proposes that a common call to this counter-summit be drafted. It is addressed to all movements wishing to join forces in defence of humanity.
Hereafter the CADTM makes known its position with regard to these two anti-democratic institutions and their policies that run counter to the exercise of human rights.
Both institutions continue to promote neo-liberalism and capitalism, which have caused social, economic and ecological devastation on a global scale.

The people of the South, who gained political independence in the late 1950s and early 1960s, have been burdened with the repayment of colonial debts and the odious debts of the despotic regimes supported by the two institutions. The latter prevented the industrialization and endogenous development of these countries in favour of the promotion of export with the active support of the local ruling classes and large foreign companies according to the demands of the global market. The World Bank has financed white elephants with huge loans, large, expensive and unnecessary projects that do not benefit the local population. These factors led to the debt crisis that broke out in 1980. This was used by the IMF and the WB to impose structural adjustment Structural Adjustment Economic policies imposed by the IMF in exchange of new loans or the rescheduling of old loans.

Structural Adjustments policies were enforced in the early 1980 to qualify countries for new loans or for debt rescheduling by the IMF and the World Bank. The requested kind of adjustment aims at ensuring that the country can again service its external debt. Structural adjustment usually combines the following elements : devaluation of the national currency (in order to bring down the prices of exported goods and attract strong currencies), rise in interest rates (in order to attract international capital), reduction of public expenditure (’streamlining’ of public services staff, reduction of budgets devoted to education and the health sector, etc.), massive privatisations, reduction of public subsidies to some companies or products, freezing of salaries (to avoid inflation as a consequence of deflation). These SAPs have not only substantially contributed to higher and higher levels of indebtedness in the affected countries ; they have simultaneously led to higher prices (because of a high VAT rate and of the free market prices) and to a dramatic fall in the income of local populations (as a consequence of rising unemployment and of the dismantling of public services, among other factors).

IMF : http://www.worldbank.org/ programmes (reduced spending on health and education, privatizations, etc.) and the opening up of the countries of the South to the free movement of capital and goods in a context of capitalist globalization, financialization, free trade and the increasing internationalization of production chains, which reduce the sovereignty of states. The two institutions have thus contributed to the impoverishment of small producers, particularly the small peasantry, the impoverishment of the working class, the casualization of jobs, especially for women and young people, and the private indebtedness of working-class households, particularly through microcredit.

As regards the environment, the World Bank continues to develop a productivist and extractivist policy that is disastrous for people and harmful to nature. Contrary to its promises, it continues to massively finance fossil fuels, which have a disastrous effect on pollution and climate change. The World Bank also finances the construction of large dams that cause enormous environmental damage. It favours the development of agribusiness against peasant agriculture, it supports the massive use of pesticides, herbicides, chemical fertilizers responsible for a dramatic loss of biodiversity and soil impoverishment. The World Bank promotes the privatization and commercialization of land for the benefit of large landowners.

The World Bank and the IMF have also contributed to the rescue of the big private banks in the major industrialized countries following the global crisis of capitalism in 2007-2008 through massive public indebtedness accompanied by austerity policies and the destruction of social gains. They have used public debt to generalize the privatization of water, land, forests, mines, fishing grounds and public services, such as education and health. The decay of the latter has been highlighted by the Covid pandemic. Since the beginning of the health crisis, the IMF and the WB, together with other institutions of big capital and multinationals (G20 G20 The Group of Twenty (G20 or G-20) is a group made up of nineteen countries and the European Union whose ministers, central-bank directors and heads of state meet regularly. It was created in 1999 after the series of financial crises in the 1990s. Its aim is to encourage international consultation on the principle of broadening dialogue in keeping with the growing economic importance of a certain number of countries. Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, Italy, India, Indonesia, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, USA, UK and the European Union (represented by the presidents of the Council and of the European Central Bank). , Paris Club Paris Club This group of lender States was founded in 1956 and specializes in dealing with non-payment by developing countries.

, etc.), have multiplied initiatives to avoid radical solutions of cancellation through deferment of payment by excluding private creditors, the main holders of the external public debt of the countries of the South. The new payment deadlines coincide with the context created by the invasion of Ukraine and the soaring prices of basic foodstuffs, livestock feed, fertilizers and energy that are hitting hardest the poorest countries already badly affected by heavy flooding and intense drought.
According to the IMF, about 60% of low-income developing countries are already in debt distress or at high risk of debt distress.
Debt suspensions are on the rise. Since 2020, 9 countries have defaulted: Argentina, Ecuador, Lebanon, Suriname, Zambia, Belize, Sri Lanka, Russia and Ghana. Several other countries are close to defaulting, such as El Salvador, Peru, Tunisia, Egypt, Kenya, Ethiopia, Malawi, Pakistan, and Turkey.
IMF and WB lending to low-income countries increased dramatically in 2020 and is expected to remain at a high level for several years. The conditionalities are increasingly binding on the populations.
Both institutions act for the benefit of a handful of big powers and their transnational corporations that reinforce an international capitalist system that is destructive to humanity and the environment. It is urgent to initiate broad mobilizations for sovereign repudiations of the debt and to build a new democratic international architecture that favours a redistribution of wealth and supports the efforts of peoples to achieve socially just development that respects nature.

The organization that would replace the World Bank should be largely regionalized (banks in the South could be linked to it), and its function would be to provide loans at very low or zero interest rates Interest rates When A lends money to B, B repays the amount lent by A (the capital) as well as a supplementary sum known as interest, so that A has an interest in agreeing to this financial operation. The interest is determined by the interest rate, which may be high or low. To take a very simple example: if A borrows 100 million dollars for 10 years at a fixed interest rate of 5%, the first year he will repay a tenth of the capital initially borrowed (10 million dollars) plus 5% of the capital owed, i.e. 5 million dollars, that is a total of 15 million dollars. In the second year, he will again repay 10% of the capital borrowed, but the 5% now only applies to the remaining 90 million dollars still due, i.e. 4.5 million dollars, or a total of 14.5 million dollars. And so on, until the tenth year when he will repay the last 10 million dollars, plus 5% of that remaining 10 million dollars, i.e. 0.5 million dollars, giving a total of 10.5 million dollars. Over 10 years, the total amount repaid will come to 127.5 million dollars. The repayment of the capital is not usually made in equal instalments. In the initial years, the repayment concerns mainly the interest, and the proportion of capital repaid increases over the years. In this case, if repayments are stopped, the capital still due is higher…

The nominal interest rate is the rate at which the loan is contracted. The real interest rate is the nominal rate reduced by the rate of inflation. , and grants that could only be given on condition that they are used in strict compliance with social and environmental standards and, more generally, with basic human rights. Unlike the current World Bank, the new bank that the world needs would not represent the interests of creditors and impose market-righteous behaviour on debtors, but would have as its primary mission the defence of the interests of the peoples who receive the loans and grants.
The new IMF, for its part, should regain part of its original mandate to guarantee the stability of currencies, fight speculation, control capital movements, and act to prohibit tax havens and tax fraud. To achieve this objective, it should contribute, in collaboration with national authorities and regional monetary funds (which must be created), to the collection of various international taxes.
The international CADTM network calls on networks, organizations, social and civil society movements in the South and the North to hold a global counter-summit to the IMF-WB Annual Meetings to be held in Marrakech from 9 to 15 October this year. An international follow-up committee will be set up to begin collective preparations for this very important global activist meeting, which could lead to other initiatives for a new international coordination of social movements.
Let’s make the voice of social movements heard in Marrakech next October. We want to demonstrate the power of organized peoples, defend popular sovereignty and promote social and environmental justice.
END THE WORLD BANK AND THE INTERNATIONAL MONETARY FUND!

ATTAC CADTM Morocco, a member of the shared international secretariat of the CADTM network, will work with its allies in Morocco on organizational and logistical matters.

The official links to follow the news on the IMF-WB Annual Meetings:
https://www.imf.org/en/News/Seminars/Campaigns/2023/Marrakech2023
https://openmorocco2023.com/