World Social Forum (WSF), Mumbai, January 2004
WCC activities

Background

There is an increasing concern that the debt problem for both poor countries in particular and the developing countries in general will not be resolved. The Sovereign Debt Restructuring Mechanism was the recent attempt by the IMF to salvage the seeming failure of the HIPC II initiative adopted by the G8 in Cologne in 1998. This proposal was rejected by some of the member countries of the IMF. Moreover, incoherence between financial and trade policies have undermined efforts to resolve this problem. As developing countries face unjust terms of trade, more debts accumulate, forcing these countries to continue borrowing. This scenario has led to what Joseph Hanlon calls the ever-increasing debt pyramids in developing countries. It is, however, obvious that there is a link between the problem of debt and unjust terms of trade faced by developing countries. Linking debt and trade could open new ways of resolving the current problem.

Debt activists have proposed a number of solutions. First, they campaigned for total cancellation of all illegitimate debts. Others have proposed a fair and transparent arbitration mechanism under either the UN or under the parties concerned as deemed appropriate. Yet others have demonstrated that debts have already been paid many times and hence need to be repudiated by way of building debt cartels.

The ecological debt is slowly gaining ground as another model of resolving the debt issue. This is closely linked to the injustice done to developing countries before and during colonialism and today’s economic globalization. Through unjust trade and so-called Foreign Direct Investment, resources continue to flow from the South to the North. Secondly, due to overproduction and consumption in developed countries, and their corporate extension in the South, the South suffers from the impact of environmental destruction, but consequently turns the countries of the South into ecological creditors and the North into debtors. It is this link between production, consumption, trade and debt that calls us to think of an alternative to the ongoing debt cancellation initiatives today. How can we link debt and trade campaign effectively? This is the main focus of the seminar.

Objectives: To reflect on the link between debt and trade.
To propose how a debt and trade campaign can be developed.

Speakers: Cecilia Cherrez, Accion Ecologica in Ecuador:
How ecological debt is linked to trade.

Martin Khor, Third World Network
Linking debt and trade: way out

Demba Dembele, Senegal:
The link between illegitimate debt and trade: new ways of campaigning.

Eric Toussaint, CADTM, Belgium
Linking terms of trade and debt: way out.

Ms. Lapapan Supamanta, general secretary of International Engaged Buddhists.
Solutions on debt and trade from the Buddhist perspective.

Moderator: Agnes Abuom

Method: Speakers will speak for 20 minutes each, followed by 30 minutes of buzz groups, then reports to the panel for another 20 minutes.

Output: A report will be produced after the Forum and shared with the participants for further follow-up.

Participants: The seminar is expected to attract more than 200 participants at the World Social Forum.

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