Committee for the Abolition of Illegitimate Debt

The 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). summit that brought together major industrialised and emergent countries in Washington on 15 November 2008 is a dismal failure. The international financial crisis is deep indeed, stock markets lost close to 40% of their capitalisation in October 2008, financial markets are awaiting decisions by the States in order to develop remedies against a dark future. The international media spotlights were on Washington for this mid-November weekend. And yet…

Yet what happened in Washington? A sorry show, a script that lacks any credibility, but few spectators seem to care Care Le concept de « care work » (travail de soin) fait référence à un ensemble de pratiques matérielles et psychologiques destinées à apporter une réponse concrète aux besoins des autres et d’une communauté (dont des écosystèmes). On préfère le concept de care à celui de travail « domestique » ou de « reproduction » car il intègre les dimensions émotionnelles et psychologiques (charge mentale, affection, soutien), et il ne se limite pas aux aspects « privés » et gratuit en englobant également les activités rémunérées nécessaires à la reproduction de la vie humaine. . In detective films it is seldom the case that the keys to the Court of Justice be given to arch criminals. Yet this is what the G20 summit is planning to do.

Since the debt crisis of 1982, major industrialised countries have strongly promoted the neoliberal economic measures that the IMF 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 and the WB 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.

were imposing on DCs. In the 1980s and 1990s the South was crushed by debts because of the fall of commodity prices and a steep rise in 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. ; it was forced to reform its economy to be able to service the debt: it introduced wild deregulation, massive privatisations, opening of markets to the greater benefit of corporations in industrialised countries, cuts in public service and social budgets … It was claimed that the source of evil was too much State intervention, and the influence of the State on the economic sphere had to be reduced at all costs, even - or rather especially - when it attempts to stand up for the interests of the majority.

For Third World populations, the remedies imposed by the IMF, the WB and later the WTO WTO
World Trade Organisation The WTO, founded on 1^st January 1995, replaced the General Agreement on Trade and Tariffs (GATT). The main innovation is that the WTO enjoys the status of an international organization. Its role is to ensure that no member States adopt any kind of protectionism whatsoever, in order to accelerate the liberalization global trading and to facilitate the strategies of the multinationals. It has an international court (the Dispute Settlement Body) which judges any alleged violations of its founding text drawn up in Marrakesh.

, at the request of leaders of countries in the North were worse than the disease. Anti-IMF riots multiplied, for instance when the price of bread doubled overnight. With the notable exception of a few left-wing governments, often placed under strong pressure to bring them back to compliance, most governments of the South applied these measures without flinching. Presented as a prime requirement to the creation of wealth, economic deregulation was extended to the whole planet. Private financial institutions were then free to invent more and more complex financial products with a view to ever-increasing profits, turning a blind eye to actual economic consequences. Mind-boggling financial packages were set up without any public control, and of course any concern for morality. As long as it was possible, the dark side of deregulation was hidden behind enticing growth figures, without letting on that the growth thus paraded benefited only the richer segment of the population and that what was actually achieved was a staggering growth of inequalities.

Then the time came when it was no longer possible to claim that the bride was beautiful when her dress was soaked in blood. The international financial crisis started in August 2007 and intensified in 2008. Major banks (Northern Rock, RBS, Bear Stearns, ING, Fortis, Dexia, UBS and so many others), big insurance companies (AIG), mortgage Mortgage A loan made against property collateral. There are two sorts of mortgages:
1) the most common form where the property that the loan is used to purchase is used as the collateral;
2) a broader use of property to guarantee any loan: it is sufficient that the borrower possesses and engages the property as collateral. associations (Freddy Mac, Fannie Mae) called on the State for help and the State often complied and bailed them out. But instead of taking advantage of the situation and retrieving control of those runaway machines, the State left decision-making power to those who had led the global economy to its current impasse.

This G20 summit shows that lessons have not been learned. The old demons of the past are still with us. The IMF and the WB, though further delegitimised by the failure of the measures they have enforced for 25 years and by the governance crisis they have experienced over the last years (Paul Wolfowitz’ forced resignation as president of the WB, Horst Köhler and Rodrigo Rato resigning from the IMF, the recent investigation concerning Dominique Strauss-Kahn at the IMF), are still at the heart of the proposed solutions. WTO negotiations aiming at even more economic deregulation, while we have just witnessed the utter failure of this policy, are again on the agenda. While IMF loans could no longer find clients, Hungary, Ukraine and Pakistan have volunteered. Contrary to denials by concerned institutions, the same intolerable conditionalities are still the order of the day: as counterpart for the latest loan Hungary had to decide, among other things, to suppress civil servants’ 13^th month bonus and freeze their salaries. Japan even proposed to supply the IMF with USD 100 billion so that it could increase its loans and carry on its fateful activities. Moreover the meeting that was intended to find a global solution to the current crisis was not held in the contexct of the United Nations but in the limited context of the G20. So the very promotors of an unfair and unsustainable model are asked to rescue this model. The only solutions that were put forward protect the interests of major creditors. Populations and poor countries as usual were not consulted.

When faced with such an inconsistent and ill-conceived script, one cannot but hope for a final twist that would introduce a measure of justice and ethics into all this. This final twist can only be found in social struggles all over the world to bring about a radical change in economic choices. And if the film should end as dismally as it started, there is a strong chance that the audience will be highly dissatisfied and make it known to the twenty directors in the most vehement manner ...