Committee for the Abolition of Illegitimate Debt

“I am seriously concerned about voices saying that Greece is in a humanitarian crisis, with shortages in medicines and food,” Mr. Bohoslavsky said from Addis Ababa, Ethiopia, where he is currently participating in the Third International Conference on Financing for Development.

“I hope that the deal struck this week in Brussels will avoid a larger crisis in Greece,” the expert said. “However, further adjustment policies should respect the human rights obligations that are binding not only for the Government of Greece, but as well for the creditor countries and lending institutions. There is real legal risk that some of the harsh austerity measures could be incompatible with European and international human rights law.”

“Priority should be to ensure that everybody in Greece has access to core minimum levels of economic, social and cultural rights, including the right to health care, food and social security,” he added.

The human rights expert said there is a need to integrate social and distributional aspects in debt sustainability analysis to make fully informed decisions before new austerity measures are adopted.

“A debt service Debt service The sum of the interests and the amortization of the capital borrowed. burden that may be sustainable from a narrow financial perspective may not be viable at all if one considers the comprehensive concept of sustainable development, which includes the protection of the environment, human rights and social development,” he noted.

“Greece seems to be already in a situation in which insolvency and illiquidity are indistinguishable. As 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 has noted on Tuesday this week, debt relief in the form of a haircut would have been the better choice to bring Greece’s debt back to sustainability. It would also reduce Greece’s unhealthy dependence on creditor institutions and reflect the principle of co-responsibility in the built-up of the public debt of Greece,” the Independent Expert argued.

Mr. Bohoslavsky stressed that interim financing for banks is now most urgently needed to ensure that the businesses can continue their economic activities. “However, I urge all parties, including the ECB ECB
European Central Bank The European Central Bank is a European institution based in Frankfurt, founded in 1998, to which the countries of the Eurozone have transferred their monetary powers. Its official role is to ensure price stability by combating inflation within that Zone. Its three decision-making organs (the Executive Board, the Governing Council and the General Council) are composed of governors of the central banks of the member states and/or recognized specialists. According to its statutes, it is politically ‘independent’ but it is directly influenced by the world of finance.

https://www.ecb.europa.eu/ecb/html/index.en.html , to be particularly careful when deciding on emergency credits to Greek banks, given the deep and irreversible political and social processes that a banking collapse could trigger in the country and the region,” he underlined.

“This is in particular important if such decisions are made on emergency credits immediately before referenda or parliamentary decisions to accept or refuse a bailout and adjustment programme,” Mr. Bohoslavsky said.

The expert noted that events before and after the referendum have shown that the democratic assertion that put into question austerity policies produced little positive response from official creditors.

“If this people’s democratic pronouncement becomes almost irrelevant, there is obviously a great challenge in Europe on how the democratic dialogue integrates national, regional and financial interests at stake when negotiating debt agreements without compromising human rights,” he stated.

The Independent Expert has been invited by the Government of Greece to undertake an official country visit from 30 November to 7 December 2015. He is also planning to visit Brussels to meet representatives from European institutions, the IMF and main creditor countries.

Mr. Juan Pablo Bohoslavsky (Argentina) was appointed as Independent Expert on the effects of foreign debt and human rights by the UN Human Rights Council on 8 May 2014. Before, he worked as a Sovereign Debt Sovereign debt Government debts or debts guaranteed by the government. Expert for the United Nations Conference on Trade and Development UNCTAD
United Nations Conference on Trade and Development This was established in 1964, after pressure from the developing countries, to offset the GATT effects.

(UNCTAD) where he coordinated an Expert Group on Responsible Sovereign Lending and Borrowing. Learn more, log on to: http://www.ohchr.org/EN/Issues/Development/IEDebt/Pages/IEDebtIndex.aspx

The Independent Experts are part of what is known as the Special Procedures of the Human Rights Council. Special Procedures, the largest body of independent experts in the UN Human Rights system, is the general name of the Council’s independent fact-finding and monitoring mechanisms that address either specific country situations or thematic issues in all parts of the world. Special Procedures’ experts work on a voluntary basis; they are not UN staff and do not receive a salary for their work. They are independent from any government or organization and serve in their individual capacity.