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STATEMENT ON THE G8 SUMMIT IN SCOTLAND, JULY 2005  

From the Catholic Bishops of Scotland, 14 June 2005  

We welcome the announcement by the G7 finance ministers of 100% cent debt relief for the eighteen countries that have completed the Heavily Indebted Poor Countries initiative, and commend the UK government for its leadership role in agreeing this. We note that a further nine countries will qualify for the same level of debt relief within the next eighteen months. The announcement has come five years after we, together with the Catholic Bishops Conference of England and Wales, and many others, called for debt remission to mark the Great Jubilee of 2000. Debts erode a government s capacity to provide even the most basic health and education services and impose the heaviest burden on those who are the least responsible for their creation.  

In our 1999 Statement on Poverty Elimination and Debt Remission, Life, Debt and Jubilee, we argued that ˜without real commitment to poverty elimination on the part of donor and debtor governments alike, even full debt cancellation will be ineffective . We note with concern the announcement by the G7 finance ministers that decisions are still to be made on how to deliver the finance urgently needed to meet the Millennium Development Goals (MDGs). We note that the target of 0.7 per cent of national wealth in development aid, agreed in 1970, has still to be met by any of the G8 countries. We hope that the G8 leaders will announce at Gleneagles their commitment to providing in full the finance required to achieve the MDGs by 2015.  

The $40 billion debt relief announced by the G7 finance ministers is, of course, hugely significant for the eighteen countries that qualify under the HIPC initiative. However, as we said in 1999, highly indebted countries have been required under the HIPC initiative to complete up to six years stringent financial management and market-oriented economic reforms, before being considered for debt relief. The G7 finance ministers emphasise the importance of good governance, which is something, we agree, that all governments “ in developed and developing countries “ must deliver. But rather than a reward for strict budgetary discipline and austerity, debt reduction should be allocated in advance for agreed programmes of health, education and investment that will provide livelihoods and productive employment. So, we urge the G7 finance ministers to deliver debt relief to those countries that have not yet qualified under the HIPC initiative at the earliest opportunity.  

Debt relief is only one of the measures needed to eliminate poverty. It must be accompanied by more and better aid and by trade justice. As we said in 1999, ˜We will have gained nothing if we achieve debt remission only to see development programmes fail because essential international aid has been cut back . We encourage each of the G8 leaders to pledge that debt relief will not be financed from future aid. Developing countries must be given the chance to trade their way fairly out of poverty and we urge the G8 leaders to ensure that trade-distorting export subsidies in agriculture are eliminated at the December meeting of the World Trade Organisation.  

ENDS  
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