UK campaign calls for major debt cancellation in Jubilee year

Image: Debt Justice

Source: Debt Justice

A consortium of charities are today warning that that high debt servicing costs are preventing Global South governments from spending on vital public services such as education and health and making investments to limit the impact of the climate emergency. Thirty-two African countries spend more on paying external debts than they do on healthcare.

UK charities including CAFOD, Christian Aid, Save the Children, Debt Justice and the international development network, Bond, are gathering outside the UK Treasury to launch a campaign calling for a debt cancellation initiative in the Jubilee year of 2025.

Debt payments for lower-income countries are at the highest level in 30 years. Private lenders are the largest group of creditors, with many based in the UK, and 90% of their contracts are governed by English law.

The campaign is calling on the UK government to champion major improvements to the debt cancellation process for lower-income countries, including legislating to ensure banks, hedge funds and oil traders participate.

In a joint statement, the charities say:

"We welcome the fact the UK government has made "tackling unsustainable debt" a major priority. However, this will not happen through business as usual but requires a complete change in the UK approach."

The campaign calls on the UK government to:

"Champion a debt cancellation scheme that brings debt payments down to a genuinely sustainable level" and to "Pass legislation to ensure all private lenders participate in debt cancellation and suspend repayments to private lenders during debt cancellation negotiations."

The South African government has made tackling the unsustainable debt crisis a key priority for its presidency of the G20 in 2025. 2025 is a Jubilee year in the Catholic Church, and Pope Francis has made achieving debt cancellation one of his key priorities for the year. World Bank Chief Economist Indermit Gill recently said:

"It's time to face the reality: the poorest countries facing debt distress need debt relief if they are to have a shot at lasting prosperity… Sovereign borrowers deserve at least some of the protections that are routinely afforded to debt-strapped businesses and individuals under national bankruptcy laws. Private creditors that make risky, high-interest loans to poor countries ought to bear a fair share of the cost when the bet goes bad."

Catholic development agencies CAFOD, SCIAF, and Caritas' new report, Jubilee 2025: The New Global Debt Crisis and its Solutions, outlines the causes of cyclical global debt crises, the inadequacies in current global debt structures, and sets out six policies to build a fair and functional debt system.

LINKS

Debt Justice (formerly Jubilee Debt Campaign) is a UK charity working to end poverty caused by unjust debt through education, research and campaigning: https://debtjustice.org.uk/

The statement and full list of signatories is at: https://debtjustice.org.uk/wp-content/uploads/2025/01/Jubilee-year-statement_27.01.25.pdf