Committee for the Abolition of Illegitimate Debt

 Wednesday, January 29:

Why should we audit debt? What is illegitimate and odious debt Odious Debt According to the doctrine, for a debt to be odious it must meet two conditions:
1) It must have been contracted against the interests of the Nation, or against the interests of the People, or against the interests of the State.
2) Creditors cannot prove they they were unaware of how the borrowed money would be used.

We must underline that according to the doctrine of odious debt, the nature of the borrowing regime or government does not signify, since what matters is what the debt is used for. If a democratic government gets into debt against the interests of its population, the contracted debt can be called odious if it also meets the second condition. Consequently, contrary to a misleading version of the doctrine, odious debt is not only about dictatorial regimes.

(See Éric Toussaint, The Doctrine of Odious Debt : from Alexander Sack to the CADTM).

The father of the odious debt doctrine, Alexander Nahum Sack, clearly says that odious debts can be contracted by any regular government. Sack considers that a debt that is regularly incurred by a regular government can be branded as odious if the two above-mentioned conditions are met.
He adds, “once these two points are established, the burden of proof that the funds were used for the general or special needs of the State and were not of an odious character, would be upon the creditors.”

Sack defines a regular government as follows: “By a regular government is to be understood the supreme power that effectively exists within the limits of a given territory. Whether that government be monarchical (absolute or limited) or republican; whether it functions by “the grace of God” or “the will of the people”; whether it express “the will of the people” or not, of all the people or only of some; whether it be legally established or not, etc., none of that is relevant to the problem we are concerned with.”

So clearly for Sack, all regular governments, whether despotic or democratic, in one guise or another, can incur odious debts. ? Debt audits: international experiences.
The presentation was made by Éric Toussaint, the spokesperson for CADTM International, and was moderated by Amali Wedagedera, researcher at the Bandaranaike Centre for International Studies in Colombo.

Éric Toussaint began by reviewing debt audits in both northern and southern countries (Ecuador, Greece, Argentina, etc.).

He pointed out that there have been examples of debt repudiation all over the world throughout history: France, Portugal, the United States, Russia, Mexico, Costa Rica....

In Europe between the wars, in the 1930s, virtually no state paid its debts; after the Second World War, 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.

was created to reverse this trend.

He explained the distinction between illegitimate and odious debt. Illegitimate debt is debt that violates national and international laws, violates human rights, benefits only a small part of the population or when a private debt becomes public because of pressure from the creditor.

Alexander Sack’s doctrine of odious debt, which was not initially conceived as a tool to free people from the disastrous decisions of their lenders but rather to maintain and reinforce the international order and ensure the continuity of payments. It allows creditors to get their money back. However, despite aligning with the creditors’ interests, Alexander Sack acknowledged the possibility of debt cancellation in certain cases.

There are two criteria for establishing odious debt:

1. 1. The debt contracted is contrary to the interests of the population.
2. That creditors were aware the money would be spent against the public’s interests.

Éric Toussaint explained his experience of the audit of Ecuador’s debt between 2007 and 2008 as a member of the commission that carried it out. Various representatives from different countries, along with social, feminist, and environmental activists, comprised the committee. He then gave an overview of the situation in Greece between 2010 and 2015, which led to disaster. His description ranged from the actions of the Troika Troika Troika: IMF, European Commission and European Central Bank, which together impose austerity measures through the conditions tied to loans to countries in difficulty.

IMF : https://www.ecb.europa.eu/home/html/index.en.html (the European economic power group made up of the European Commission, the European 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 , 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 ) to the decision by the President of the Greek Parliament, Zoe Konstantopoulou, to form a scientific commission with an international team of specialists coordinated by Toussaint, who formed the Debt Audit Committee. The process concluded that the country’s sovereign debt Sovereign debt Government debts or debts guaranteed by the government. was unsustainable, and there were cases of illegal, illegitimate, and odious debt. The Commission for the Truth about Greece’s Public Debt conducted the audit and published a report in April 2015 with findings. But on January 20, 2015, Yanis Varoufakis had already signed a disastrous deal with the Eurogroup: Greece agreed to pay its creditors on time and to adopt new proposals for “reforms” and austerity measures.

 Thursday, January 30:

Audit of public debt in Sri Lanka: where to start?
Gamini Wijesinghe, retired Auditor General of Public Finance of Sri Lanka (2015-2019), and Sarath Mayadunne, retired Auditor General of Public Finance of Sri Lanka (2000-2006).

The two former auditor generals of Sri Lanka shared their experiences of carrying out audits. They discussed Sri Lanka’s public debt and deficit situation. The two speakers also criticised the lack of transparency in the country’s debt processes, which the Parliament theoretically should approve but does not.

 Friday, January 31:

Global debt scenario: IMF, World Bank, and BRICS BRICS The term BRICS (an acronym for Brazil, Russia, India, China and South Africa) was first used in 2001 by Jim O’Neill, then an economist at Goldman Sachs. The strong economic growth of these countries, combined with their important geopolitical position (these 5 countries bring together almost half the world’s population on 4 continents and almost a quarter of the world’s GDP) make the BRICS major players in international economic and financial activities. as an alternative.

The presentation was made by Éric Toussaint, the CADTM spokesman, and was moderated by Sushovan Dhar.

Éric Toussaint began his presentation with a timeline of the global economic situation in recent years, from the private and banking debt crisis of 2007-2008 in the countries of the North Atlantic, to the public debt crisis in Europe between 2010 and 2016, with the direct intervention of the IMF in many countries such as Greece, Spain, Cyprus and Ireland.

He touched on the global circumstances that have had an impact on the new international debt crisis: the Covid-19 pandemic in 2020-2022 and Russia’s invasion of Ukraine in February 2022. This generalised crisis has greatly affected developing countries.

Faced with this crisis :

• - 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). ’s response is not to cancel the debt but to defer it.
• The IMF and World Bank’s response is to implement austerity measures in exchange for loans.
• China’s response has been to protect its economy while seizing the opportunity to increase its global influence by reproducing the economic conditionalities of capitalist countries.

Finally, an analysis of the role of the BRICS in the world economy shows that they offer no alternative for the people. In fact, they are doing the same thing as the IMF, but in a different way in terms of extractivism, the destruction of natural resources, the production of fossil fuels and subservience to the dollar. In addition, the New Development Bank (NBD) has disappointed by asking the financial markets for credit in dollars.

4 : Public debt crisis in South Asia.
Monower Mostafa, Bangladesh Working Group on External Debt; Sankha Subhra Biswas, Collective for Economic Justice, Kolkata; and Abdul Khaliq, CADTM Pakistan, moderated by Nalini Ratnarajah, South Asia Network for the Eradication of Poverty.

The session began with a presentation by Abdul Khaliq entitled ‘The debt dilemma of Pakistan’, which was on the verge of default last year.

As elsewhere, the IMF’s intervention in Pakistan has come at the cost of subsidy cuts, higher taxes, inflation Inflation The cumulated rise of prices as a whole (e.g. a rise in the price of petroleum, eventually leading to a rise in salaries, then to the rise of other prices, etc.). Inflation implies a fall in the value of money since, as time goes by, larger sums are required to purchase particular items. This is the reason why corporate-driven policies seek to keep inflation down. , and poverty (more than 40% of Pakistanis live below the poverty line, i.e., more than 2.6 million people in 2024). Abdul Khaliq explained the extremely tough conditions imposed by the IMF in July 2024, in particular the new wave of privatisation in all sectors (airlines and shipping companies, motorways, postal services, television channels, and metallurgical companies).

The real problem is political instability, with Imran Khan, for example, imprisoned for political reasons even though his party dominated the elections.

The key proposals put forward by Abdul Khaliq are as follows:

• Creation of a parliamentary debt audit committee
• Parliamentary approval of all proposed debt agreements
• The introduction of progressive taxes aims to tax the wealthiest individuals
• Social protection for the vulnerable

Monower Mostafa elucidated the challenging circumstances faced by the people of Bangladesh, emphasising that foreign investment has not improved their situation, as the profits consistently flow to the investing countries, thereby further reducing the wages of women textile workers.

Bangladesh adopted a free-market ideology in the 1990s, privatising, deregulating, and destroying all kinds of rights. The degradation of the peasantry led to a massive flight to the cities to work in the textile industry.

With inflation at over 20% and a huge debt (around 180 billion dollars), paying the interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. is an impossible challenge.

The main bilateral creditors of the country’s foreign public debt are Russia, India, and China, all of which are competing for investments in Bangladesh.

Foreign currency comes mainly from emigration and the textile industry.

He believes that the situation is critical and that social mobilisation around the debt is necessary, but no political party is considering it. Simultaneously, we must resolve the major issues of capital flight and tax evasion.

Finally, Sankha Subhra Biswas spoke about the problems faced by Indian states.

He explained that while the debts of the various states that make up India are increasing, the growth in sovereign debt is stable. He therefore proposes putting an end to the GST (goods and services tax, the successor to VAT) through more direct taxes and greater autonomy.

His proposals also include the creation of a public debt monitoring committee and an increase in the funds allocated to social security.

Sri Lanka’s political context, agreement with the IMF, debt crisis, and impacts on gender.
Kanchana Ruwanpura, Institute of Political Economy of Sri Lanka and Dhanusha Gihan Pathirana, People’s Struggle Alliance, moderated by Sushovan Dhar, CADTM.

The two speakers reviewed the political and economic situation in Sri Lanka. In particular, they discussed the agreement with the International Monetary Fund, which imposes a series of neoliberal measures on the government, such as privatisation, higher VAT, and lower prices to support farmers.

Kanchana Ruwanpura, as a feminist economist, analyses the debt crisis from a feminist point of view, denouncing the policy-makers who are once again ignoring the specific interests and needs of women, even though they are the hardest hit when it comes to paying off the ‘odious’ debt generated by the recklessness and corruption of Sri Lanka’s political elites, who have always been almost entirely male, despite the current female face of Prime Minister Harini Amarasuriya.

Sri Lanka, political context, agreement with the IMF, debt crisis, and its impact on gender.
Madhulika Gunawardena, Feminist Collective for Economic Justice, and Amali Wedagedera, Bandaranaike Centre for International Studies, in Sri Lanka, moderated by Sushovan Dhar, from CADTM.

Amali Wedagedera addressed the problems of debt and its consequences from an eco-feminist perspective. Microcredits and their effects on the female population were also discussed, with direct examples such as the wives of Sri Lankan fishermen, who are forced to apply for them. The situation of fishermen is directly linked to the actions of the IMF, which therefore bears a great responsibility for the uncertain future of thousands of women.

Madhulika Gunawardena explained the problem of low incomes affecting families, their nutrition, their health, the lack of family conciliation, etc.

She explained her human rights work with the trade union DABINDU COLLECTIVE, a non-profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. organisation founded in 1984 to protect and promote the rights of women workers in the Katunayake Free Trade Zone (FTZ). Dabindu has worked actively and tirelessly to mobilise women workers, equip them with knowledge on human rights, women’s rights and labour rights, and strengthen women workers’ leadership. In addition, its 2019 report highlights violations of International Labour Organisation (ILO) Convention C-190 on violence and harassment in the FTZs of Gampaha, Sri Lanka’s second most populous district.

 Saturday, February 1

7 : Microcredit and family debt.
Omar Aziki, ATTAC-CADTM Morocco, Suganya Kandeepan, Feminist Collective for Economic Justice and the Vimukthi Peasant Women’s Society, Hingurakgoda, Sri Lanka, and moderated by Shweta Tambe, Habitat and Livelihood Welfare Association, Mumbai.

The presentation began with an analysis of the debts contracted by families through microcredit: over-indebtedness, pressure to repay accumulated debts, high 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. , high costs, difficulty generating profits, inadequate management of resources due to a lack of financial education, dependence on intermediaries, and pressure at the social and family level.

Despite the changes that have taken place in the world of microfinance in an attempt to bring it closer to the poorest, these changes have not gone beyond changing their original names in order to gain social acceptance and erase their negative connotations. This strategy has resulted in significant growth in the global microfinance markets.

For the CADTM, the fight against debt includes the fight against microcredits. Ultimately, the CADTM concluded that microcredits lack legitimacy. However legal they may appear, they are not a solution and reproduce the mechanisms that generate poverty.

The contracts are often illegal because they take advantage of the ignorance, lack of language skills, and lack of training, particularly in literacy, of the people recruited.

The alternatives to illegitimate private debt are:

• - An ethical public bank with low interest rates.
• Create decent jobs and put an end to job insecurity.
• Put an end to the privatisation of public services and cancel any existing privatisations, including those of services and agricultural land.
• To release the means to do this, suspend payment of the public debt.

Ecological debt.
Maxime Perriot, CADTM Belgium, and Melani Gunathilaka, Law & Society Trust, Sri Lanka/Climate Debt, moderated by Shweta Tambe, Habitat and Livelihood Welfare Association, Mumbai

Maxime Perriot addressed the issue of ecological debt. He began by analysing the historical responsibilities of the Western ruling classes and international financial institutions, which are, in fact, responsible for most of the historical greenhouse gas emissions and for imposing a destructive economic system on the countries of the South, first through colonisation and then through debt. He then criticises the false solutions promoted by these same institutions, such as debt-for-nature swaps, which allow us to believe that capitalism can solve the ecological crisis while generating more financial exchanges and profits. Finally, he detailed the solutions promoted by the CADTM, such as:

• - Debt cancellation
• Payment of reparations to the countries of the South
• Radical taxation of the richest and biggest companies

Melani Gunathilaka clarified that the perception of climate change differs significantly between the North and the South. The impact on the southern coasts is already evident, with rising sea levels on some islands. Debt for Climate rejects neoliberal solutions to rising emissions based on the commodification of the climate and the planet in order to continue to profit, through the financial markets, from climate change and the tragedy it represents now and in the future.

In Sri Lanka, financial colonisation is affecting people by destroying traditional ways of life, forcing internal displacement and migration to other countries, and degrading harbours and beaches with plastic floods, as well as the marine systems that provide the only livelihoods for many people. Over the last 5 years, a multitude of toxic agents have been detected in water and wildlife.

In Sri Lanka, we also have to take into account cross-border pollution from India, which is very close to the island and transports it without doing anything to contain it. Finally, Melani Gunathilaka also touched on the silent danger of microplastics due to the poor management of plastic waste and the difficulty of detecting it. Rather than tackling the problems of climate change by treating the symptoms, we need to tackle the causes, which are none other than the global financial architecture.

Sushovan Dhar, CADTM International, Fernanda Gadea, ATTAC Spain and Manisha Veeraddana, University of Kelaniya, Sri Lanka, moderated by Vimukthi de Silva.

Sushovan Dhar highlighted the links between migration and debt. Debt can be both a cause and a consequence of migration, and in many cases migrants face additional challenges because of their financial situation. It is a complex phenomenon that requires comprehensive public policies to tackle the underlying causes, such as poverty and lack of opportunity. And let’s not forget that, once again, the situation is much more difficult for migrant women. Consequences of debt-related migration :

• - Social vulnerability: migrants who arrive in a new country with debts may face precarious living conditions and labour exploitation.
• Family separation: debt-related migration often involves the separation of families, which has emotional and social consequences.
• Dependence on remittances: In certain instances, families in the country of origin rely solely on remittances sent by migrants, thereby perpetuating the migration cycle.
• Risks during the journey: Migrants fleeing debts or seeking to repay them may face dangers during their journey, especially if they use irregular routes.

Fernanda Gadea presented the case of irregular migration in the Spanish State and specifically in the Canary Islands while unmasking the figure of the greatest danger of "Fortress Europe’, which is FRONTEX, the European Border and Coast Guard Agency. Created in 2004, its budget has risen from 6.2 million euros in 2005 to over 2 billion in 2022. Human rights violations are flagrant, particularly at Europe’s southern border, the gateway to Africa through the Strait of Gibraltar, and on the deadly sea route to the Canary Islands in the middle of the Atlantic Ocean, one of the most dangerous in the world today.

2024 marks an all-time record for the arrival of small boats and cayucos (flat-bottomed pirogues built from a single piece of tree trunk): 61,000 migrants arrived in Spain irregularly by sea, the majority to the Canary Islands. More than 10,400 of them died trying to reach the Spanish coast last year. Spain, with figures similar to those for Greece, is the third country with the most migrants rescued on its coasts, overtaken by Italy with almost 66,000 shipwrecked at sea. In the first two months of 2025, around 2,000 people arrived on the coast of the Canary Islands.

Manisha Veeraddana has produced an analysis of migration in Sri Lanka. With the recent launch of the National Policy and Action Plan on Migration for Employment (2023-2027), it provides an overview of women migrant workers returning to Sri Lanka and the socio-economic causes that determine these women’s final decisions on migration and/or reintegration. It is important to focus on the invisible struggles of these returning migrant workers in order to establish possible areas for policy action, particularly in relation to economic reintegration.

The conclusion is that there is a great need for action, starting with raising awareness of employment opportunities for domestic workers in Sri Lanka and creating links between the existing care work market and the labour potential in rural areas, in order to make employment opportunities in care work more accessible to those who have already completed their migration process and will not be able to upgrade their skills or do not feel inclined to undertake it. This could offer women who are forced to remigrate as domestic workers, particularly because of family ties, the chance to consider opportunities in a more familiar and safer environment. In addition, further research is needed into the socio-cultural dynamics within communities where female emigration is prevalent in order to provide effective policy responses.

Popular struggles, alternatives, and strategies to combat the crisis.
Israel Dutra, member of the political party PSOL (Partido Socialismo e Libertad), Brazil,Swastika Arulingam, United Federation of Labour, Sri Lanka; Richard, Richard, International Research and Education Institute, Manila, Philippines; and Éric Toussaint, CADTM International, moderated by Amali Wedagedera.

The activity begins with Donald Trump’s controversial return to power in the United States, which poses the danger of the rise of fascism around the world. The far right has already chosen its targets: women, social and environmental activists and, above all, migrants. The solution lies in social mobilisation and holding international anti-fascist conferences as forums for meetings and discussion. One example is the proposed conference in Belém, taking advantage of the COP30 meeting in the heart of the Brazilian Amazon in mid-November 2025. This is a good opportunity to demonstrate that the mantra ‘the fight against fascism has no chance of winning’ is an illusion, as demonstrated by the mobilisations in Bangladesh and Sri Lanka, where people took to the streets to protest against the government, achieving a turn to the left, if not completely, at least in the right direction, and which offer hope for the internationalist left. So the strategy is not to give up.

The meeting closed with the adoption of the Colombo Declaration 2025: Against IMF-led agreements, debt, and austerity.