Committee for the Abolition of Illegitimate Debt

CADTM Abya Yala Nuestra America, (CADTM AYNA) and CADTM Europe firmly support the sovereign right of the Argentine nation to declare YFP, the principal petroleum company operating within its territory, to be of public utility and to proceed to the expropriation of the stock held by the Spanish multinational Repsol.

We fervently reject the international campaign of menaces and calls for heavy sanctions against Argentina initiated and transmitted by unscrupulous bosses, the Spanish government, eminent members of the European Union and the conservative establishment and media.
We are shocked to see that public opinion is deliberately misinformed and led to believe that the defence of the special interests of Repsol merit Spanish and European public concern. Repsol is a private multinational company regularly accused of non-respect of its contractual obligations, labour laws and environmental regulations. It is also to be noted that Repsol uses tax havens to avoid tax payments whilst the Spanish and European populations are in the grip of austerity measures.

We consider this measure, in spite of its insufficiencies and limits, to be a positive step toward the re-appropriation of strategic natural resources by all countries in parallel with the development of an integrated energy policy between Latin American countries permitting the affirmation of independence from multinational companies and supranational powers.
We also call on the governing bodies to renounce the exportation and extraction based economic models actually pursued in favour of a prudent, reasonable and environmentally respectful use of natural resources. It is essential that ecological debts be repaid and the living conditions of the populations be improved.

We call for the Argentine government to immediately denounce bilateral investment treaties without renewal, leave the ICSID ICSID The International Centre for the Settlement of Investment Disputes (ICSID) is a World Bank arbitration mechanism for resolving disputes that may arise between States and foreign investors. It was established in 1965 when the Washington Convention of that year entered into force.

Contrary to some opinions defending the fact that ICSID mechanism has been widely accepted in the American hemisphere, many States in the region continue to keep their distance: Canada, Cuba, Mexico and Dominican Republic are not party to the Convention. In the case of Mexico, this attitude is rated by specialists as “wise and rebellious”. We must also recall that the following Caribbean States remain outside the ICSID jurisdiction: Antigua and Barbuda, Belize, Dominica (Commonwealth of) and Suriname. In South America, Brazil has not ratified (or even signed) the ICSID convention and the 6^th most powerful world economy seems to show no special interest in doing so.

In the case of Costa Rica, access to ICSID system is extremely interesting: Costa Rica signed the ICSID Convention in September, 1981 but didn’t ratify it until 12 years later, in 1993. We read in a memorandum of GCAB (Global Committee of Argentina Bondholders) that Costa Rica`s decision resulted from direct United States pressure due to the Santa Elena expropriation case, which was decided in 2000 :
"In the 1990s, following the expropriation of property owned allegedly by an American investor, Costa Rica refused to submit the dispute to ICSID arbitration. The American investor invoked the Helms Amendment and delayed a $ 175 million loan from the Inter-American Development Bank to Costa Rica. Costa Rica consented to the ICSID proceedings, and the American investor ultimately recovered U.S. $ 16 million”.

https://icsid.worldbank.org/apps/ICSIDWEB/Pages/default.aspx (International Centre for the Settlement of Investment Disputes), a dependancy 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.

and to repudiate the debts that public and transparent audits have shown to contain an illegitimate character.

We call for the greatest support and solidarity with Argentina in the face of manoeuvrings, aggressions, exclusions or sanctions resulting from pressure by powerful foreign petroleum interests and welcome this initial step towards the social management of strategic natural resources.

Signatures: CADTM Abya Yala Nuestra America, CADTM Europe, CADTM international secretariat

The Committee for the Abolition of Third World Debt is an international network comprising members and local committees.

Translated by Mike Krolikowski