draft report - European Parliament
Transcription
draft report - European Parliament
EUROPEAN PARLIAMENT 1999 « «« « « « « « « « «« 2004 Committee on Development and Cooperation PROVISIONAL 2001/2158(COS) 14 December 2001 DRAFT REPORT on the Commission Communication concerning the proposal for a Council decision on the adoption of the position of the Community within the ACP-EC Council of Ministers regarding the settlement of all ACP HIPC LDCs’ special loans remaining after full application of HIPC debt alleviation mechanisms (COM(2001) 210 – C5-0394/2001 - 2001/2158(COS)) Committee on Development and Cooperation Rapporteur: Mario Mantovani PR\454595EN.doc EN PE 310.427 EN PE 310.427 EN 2/14 PR\454595EN.doc INDEX Page PROCEDURAL PAGE.......................................................................................................... 4 MOTION FOR A RESOLUTION.......................................................................................... 5 EXPLANATORY STATEMENT ............................................................................................ ................................................................................................................................................ ................................................................................................................................................ ................................................................................................................................................ PR\454595EN.doc 3/14 PE 310.427 EN PROCEDURAL PAGE By letter of 25 April 2001 the Commission forwarded to Parliament its Communication on the proposal for a Council decision on the adoption of the position of the Community within the ACP-EC Council of Ministers regarding the settlement of all ACP HIPC LDCs’ special loans remaining after full application of HIPC debt alleviation mechanisms (COM(2001) 210 – 2001/2158(COS)). At the sitting of 3 September 2001 the President of Parliament announced that she had referred this proposal to the Committee on Development and Cooperation as the committee responsible and to the Committee on Budgets for its opinion (C5-0394/2001). At its meeting of 3 September 2001 the Committee on Development and Cooperation appointed Mario Mantovani rapporteur. It considered the Council proposal and the draft report at its meetings of … . At the latter/last meeting it adopted the motion for a resolution by ... votes to ..., with ... abstention(s)/unanimously. The following were present for the vote: ... chairman/acting chairman; ... and ..., vicechairman/vice-chairmen; ..., rapporteur; ..., ... (for ...), ... (for ... pursuant to Rule 153(2)), ... and ... . The explanatory statement will be presented orally in plenary sitting. On 1 October 2001 the Committee on Budgets decided not to deliver an opinion. The report was tabled on .... The deadline for tabling amendments will be indicated in the draft agenda for the relevant part-session/is ... on ... . PE 310.427 EN 4/14 PR\454595EN.doc MOTION FOR A RESOLUTION European Parliament resolution on the Commission Communication regarding the proposal for a Council decision on the adoption of the position of the Community within the ACP-EC Council of Ministers regarding the settlement of all ACP HIPC LDCs’ special loans remaining after full application of HIPC debt alleviation mechanisms (COM(2001) 210 – C5-394/2001 - (2001/2158(COS)) The European Parliament, – having regard to the Commission Communication regarding the proposal for a Council decision on the adoption of the position of the Community within the ACP-EC Council of Ministers regarding the settlement of all ACP HIPC LDCs’ special loans remaining after full application of HIPC debt alleviation mechanisms (COM(2001) 210 – C5394/20011) – having regard to Article … of the … Treaty, – having regard to Rule 47(1) of its Rules of Procedure, – having regard to the report of the Committee on Development and Cooperation (A5-xxx), – having regard to the ACP-EU Association Agreement and, in particular, Article 66 thereof, – having regard to the 'Jubilee 2000' campaign and, in particular, the request put forward by the Vatican, – having regard to the Cairo Declaration and the action plan adopted at the Africa-Europe Summit (3-4 April 2000), – having regard to the UN Millennium Summit Declaration (6-8 September 2000), – having regard to the Brussels Declaration and the action plan adopted at the Third UN Conference on the Least-Developed Countries (20 May 2001), – having regard to the G8 declarations, in particular those issued at Cologne (June 1999) and Genoa (July 2001), – having regard to the Council decision of 6 July 1998 concerning exceptional assistance for the heavily indebted ACP countries (98/453/EC), – having regard to the ACP-EU Joint Assembly’s resolutions on the debt burden in the ACP countries, which were adopted on 24 September 1998 in Brussels, – having regard to its past resolutions on poor countries’ external debt, in particular resolutions A4-0382/97 and B5-0417, 0420 and 0428/2000, 1 OJ C … PR\454595EN.doc 5/14 PE 310.427 EN – having regard to the Commission’s Communication and its proposal for a decision (COM(2001)210 final – C5-0394/01), – having regard to the report of the Committee on Development and Cooperation (A5-…), A. whereas, in many cases, the amount of development aid received by some of the countries affected by the debt crisis is less than the amount which those countries pay out in order to service their debt, B. whereas most of the countries deemed by the IMF and the World Bank to be highly indebted poor countries (HIPC) are ACP countries, and whereas the debt burden in those countries is a major obstacle to social and economic development, C. whereas poverty in many developing countries is likely to worsen as the September 11 2001 events have deepened the pre-existing global economic slowdown, D. whereas, in order to break the poverty spiral in which the HIPCs are trapped, peace must be established as a first step, so as to enable the resources released by means of debt alleviation to be used effectively; in a war situation (such as prevails in Angola, Colombia, Sierra Leone and Palestine, amongst other countries) it is obvious that development plans are bound to fail, E. whereas efforts to mobilise additional debt relief should be seen as part of the total effort to strengthen resources in support of social and human development objectives and targets, F. whereas in the Göteborg Declaration and the Laeken Conclusions the Council reaffirmed the EU’s commitment to achieving the official UN objective of allocating 0.7% of GDP to development aid and whereas, in preparation for the holding of the UN ‘Financing for Development’ (FfD) Conference in March 2002 and the Earth Summit (to be held in September 2002 in Johannesburg), a specific timetable (accompanied by the necessary measures) should be drawn up for the purpose of achieving that objective, G. whereas human development is essential as a means of upholding human rights and whereas basic, fundamental rights such as the right to life, employment and well-being are in their turn the basis of human development, H. whereas, although Parliament has no powers where the EDF is concerned, it receives financial information thereon each year and is responsible for granting annual approval of the Commission’s management in respect of EDF implementation, 1. Points out that, in recent years, many loans have been granted to the ACP countries to enable them to finance their debt or the interest on existing loans and not for the purpose of fresh investment, and that this vicious circle, which leads to an increase in poverty, must be broken; PE 310.427 EN 6/14 PR\454595EN.doc 2. Welcomes the proposal submitted by the Commission, which supplements the other initiatives undertaken for the benefit of the least-developed countries along the lines advocated by Parliament and which will enable the poorest ACP countries to make some progress in the fight against poverty; 3. Regrets the fact, however, that it was not formally consulted regarding that proposal, 4. Considers that the enhanced HIPC initiative is still inadequate in the current context of economic globalisation, even though it acknowledges the failure of earlier programmes based on purely on macroeconomic strategies and is designed to establish a link between debt alleviation and poverty reduction (a formula based on the Poverty Reduction Strategy Papers) by making the eligibility criteria more flexible; 5. Advocates supporting alternative efforts to revise the debt sustainability thresholds from a human development perspective; 6. Considers that the public-debt relief process should be speeded up and deepened in countries which apply the principles of good governance and give priority to poverty eradication; 7. Stresses that long-term debt sustainability will depend upon the maintenance of sound economic policies, strengthened debt management and the provision of appropriate financing; in this context, and in connection with the various medium- and long-term support initiatives, the special links which exist between certain Member States (and in general the most highly industrialised countries) and certain HIPCs could play a crucial role in the period which comes after the economic adjustment and transition stage following the cancellation of a debt, with a view to ensuring that those HIPCs are gradually incorporated into the international economy; 8. Considers that improving the effectiveness of public expenditure is the most appropriate way of ensuring that the resources released by means of debt alleviation (together with other resources and external aid) contribute effectively to poverty reduction; 9. Considers that whatever additional funds governments obtain through debt relief should be allocated to social projects by means of plans agreed with donors and civil society, so as to increase social expenditure in areas such as basic education and primary health care, Aids and other measures designed to reduce poverty; 10. Recommends that the drawing up of Poverty Reduction Strategy Papers should be a transparent, participatory process in which civil society is involved in determining development priorities; 11. Notes that Poverty Reduction Strategy Papers provide a vehicle for structuring partnerships with donors and a framework for the interventions of donors and other PR\454595EN.doc 7/14 PE 310.427 EN partners to ensure that external support is well integrated into national programmes; 12. Calls on the Commission and the Member States to offer technical assistance to the ACP countries so that they can devise debt-management schemes (to include internal debt as well) and to establish mechanisms which will ensure that the proceeds of debt relief are invested in human-development programmes along the lines of the model devised by the UNDP, namely National Partnership Facilities which could provide a basis for coordination between donors and MFIs (Multilateral Financial Institutions), so as to enable the use of the resources released to be monitored; 13. Points out that the success of the initiative designed to help the HIPCs calls for coordination between the various donors and creditors and that, when debt-relief plans are implemented, the burden of such an operation must be fairly distributed; 14. Urges banks and financial institutions of industrialised countries to increase their efficiency in delivering aid, to remove bureaucratic obstacles and harmonise their procedures in order to reduce delays and transaction costs to a minimum; 15. Considers that, since not all the EU Member States are represented within the G8 group, the EU should coordinate Community proposals within that group, the World Bank and the IMF, so that it can offer significant financial support for debt relief, consistent with its role as the world’s largest donor; 16. Considers that, taking into account recent events, the HIPC initiative should provide for additional assistance at the completion point if there has been fundamental change in a country’s economic conditions due to exceptional external circumstances, 17. Considers that trade is an important source of growth and poverty reduction and that greater access to markets would provide a major boost to development, 18. Calls on the MFIs, the WTO and other multilateral organisations involved in the Integrated Framework Initiative to increase the trade-related technical assistance which they provide to the least-developed countries so as to help them to overcome the internal obstacles to trade integration; 19. Recognises that for most low-income countries the availability of Official Development Assistance remains an essential supplement to domestic resources mobilisation and foreign investment if growth and poverty reduction goals (2015 targets) are to be achieved; therefore stresses the need to reach the 0.7 percent ODA/GNP target; a tangible proposal and a specific timetable put forward by the major industrialised countries (those belonging to the G8 group) would send out a forceful message designed to involve the international community in the success of the Monterrey Conference and in the very future of development cooperation; PE 310.427 EN 8/14 PR\454595EN.doc 20. Calls once again for the EDF to be incorporated in the EU’s overall development budget, since this would significantly increase the transparency, the profile and the consistency of the EU’s external actions; 21. Instructs its President to forward this resolution to the Commission, the ACP-EU Council, the UN, the IMF and the World Bank. PR\454595EN.doc 9/14 PE 310.427 EN EXPLANATORY STATEMENT Introduction The problem of external debt and the ability to service the interest payable on that debt continues to be one of the basic features of economic development in the ACP countries. The highly indebted countries (most of which are located in Africa) allocate on average 40% of their annual budgets to debt servicing, which reduces their ability to offer their people basic social services such as healthcare and education. Paradoxically, the development aid provided by the EU and its Member States to the world's poorest countries is on occasion not even sufficient to cover the cost of servicing their external debt. For this reason there have been repeated calls, both within the Joint Assembly and within Parliament itself, for a revision of the various political options available for addressing and resolving the issue and, at the same time, stimulating economic growth and improving the living standards of the peoples affected. Parliament has more than once urged the EU and its Member States to take the initiative and to promote a more ambitious strategy within the international financial institutions in order to bring about faster, deeper and broader reduction or cancellation of the poorest developing countries' debt (see in particular Resolutions A40382/97, B5-0417, 0420 and 0428/2000) Miscellaneous Initiatives The main categories of external debt are public- or private-sector debts, bilateral or multilateral debts and short- and long-term debts. They may be classified as loans granted under preferential terms (e.g. 0.7 % interest rate) for development purposes or granted in the form of non-bank export credits, e.g. for guaranteed exports. Traditionally, the bodies responsible for cancelling or renegotiating debts have been the Paris Club (bilateral public debts) and the London Club (private debts). The Paris Club may grant a reduction of up to 67%. In 1996 it became obvious that such initiatives were not enough to resolve the debt crisis and that certain countries continued to be burdened by an unsustainable debt. The HIPC initiative was then launched in order to extend the scope of the earlier initiatives, a figure of up to 80% being achieved. For the first time the relief of debts contracted with the World Bank and the IMF, and of other multilateral debts, was included. What is new about this initiative is the wish to strive for coordinated international cancellation of debt, including multilateral debt, whereas earlier initiatives were concerned essentially with bilateral public debts within the context of the Paris Club. Another new feature is the inclusion of the criterion of 'sustainable' debt defined on the basis of the relationship between the size of the accumulated debt and the level of exports. At the G7 summit held in Cologne in June 1999 it was decided that the initiative agreed in PE 310.427 EN 10/14 PR\454595EN.doc 1996 should be enhanced so as to deepen and enlarge its scope and speed up its effects. Consequently, the Community and the ACP States decided in December 1999 to allocate EUR 1 billion drawn from the EDF to the enhanced HIPC initiative. Debt, poverty and development The increase in the cost of debt servicing, combined with the steady fall in the price of basic commodities, has caught many developing countries in the 'debt trap', the consequences of which are many: quite apart from the dysfunctioning of the financial markets and the threat to the financial stability of all those involved, the debtor countries obviously suffer, as do their people who are required to carry the full burden of the debt since they are deprived of the means of satisfying their basic needs, i.e. food, health care and education. The outflow of the foreign currency needed in order to service the debt restricts the scope of the financial autonomy needed for development to occur. A high level of indebtedness deters investors and drives capital out of the country. The pressure exerted by the debt often requires countries to produce single cash crops for export at the expense of traditional food crops, which only aggravates poverty. In other words, indebtedness leads to a spiral of poverty and arrested development in the countries affected. In the past, however, the problem of third-world debt has not been considered sufficiently from the point of view of its impact on development and poverty. The 1999 G7 Cologne initiative was intended as part of an increased effort to reduce poverty. However, people talk of a 'sustainable' level of debt by taking a certain percentage of a country's exports as a reference figure without considering what each country actually needs in order to be able to carry through its poverty-reduction strategies (health, education), and they promote macro-economic incentives which are not necessarily of benefit to the poorest people. For this reason, debt sustainability should be defined in relation to the poverty situation in each country. The starting point for this should be that the budget resources of each country affected by the debt crisis should be allocated primarily to poverty reduction and human development. The minimum amount of funding needed to meet this basic objective (basic education and health care, Aids prevention, debt etc.) should be 'ring-fenced' for that purpose and only some of the remaining resources should be regarded as being available for paying off the external debt. In other words the debt-sustainability criterion should be defined in relation to human development and not in relation to micro-economic sustainability criteria. Community involvement and Parliament's position From the outset the EU has supported the HIPC initiative and played a full part in it by making funding available for the ACP beneficiary countries. By means of its decision of 6 July 1998 (on which Parliament expressed its views in its resolution A4-382/97) it undertook to secure a debt reduction for all the ACP countries which opted for the HIPC initiative. Following the adoption of the enhanced HIPC initiative in 1999 and the consequent easing of the eligibility criterion, the retrospective application of further criteria, the increase in the number of countries involved and the speeding up of the decision-making process, the cost of PR\454595EN.doc 11/14 PE 310.427 EN the initiative has risen, with the result that the repayments which are possible in accordance with the abovementioned Council decision are inadequate. For this reason extra resources need to be granted for the least-developed ACP countries. Parliament has repeatedly stressed the need to establish a link between the carrying-out of genuine economic reforms and the granting of debt relief, the latter being part of the fight against poverty. In this connection, Parliament considers that human- and social-development indicators should be used as criteria for determining whether or not a country is eligible for debt relief or debt cancellation. It also considers that the countries affected should be offered assistance to help them manage their debt, so as to ensure that they observe the principles of democracy and good governance when using the resources obtained through debt relief. The proposal under consideration In order to give fresh impetus to the international consensus regarding debt reduction and to respond to the international community's growing concerns regarding the increasing marginalisation of the least-developed countries within the world economy, the Community is now proposing full cancellation of the debts linked to any of the special loans granted to the least-developed ACP countries under the first three Lomé Conventions which are still outstanding following the introduction of debt-relief measures under the enhanced HIPC initiative. Special loans, which are long-term loans devised on easy terms and granted to the ACP countries under Lomé I to III, have not been issued since Lomé IV came into force. For this reason the Commission is proposing to the Council a decision (the one contained in the document with which Parliament's report is concerned) to be adopted by the ACP-EU Council. The Community's current involvement in the enhanced HIPC initiative takes into account the debt relating to special loans and to risk capital but it requires the HIPC countries to use in the first instance the funds allocated by the Community in connection with the initiative designed to enable the debt linked to all outstanding special loans to be repaid before any start is made on re-paying risk capital. In many of the ACP's least-developed countries this standard debtrelief mechanism within the HIPC initiative is enough to enable all special loans to be cancelled, but this is not the case in all countries. The decision which the Commission is submitting to the Council will enable all the ACP’s least-developed countries which have reached their ‘decision point’1 under the standard HIPC mechanism to be granted immediate payment in full of the cost of servicing the debt relating to special loans. Your rapporteur naturally welcomes this initiative, which supplements other actions undertaken for the benefit of the least-developed countries and which will enable the problem of the poorest countries’ indebtedness to be addressed effectively. However, certain 1 The country must adopt adjustment and reform programmes supported by the IMF and the World Bank and pursue them for three years. At the end of this first phase the country's eligibility for debt relief is assessed by a debt sustainability analysis (DSA) to determine the current external debt situation. If the country has established a satisfactory track record of reform and sound policies it has reached the decision point where IMF/World Bank will formally decide on country's eligibility, the amount and terms of the assistance based on actual data. PE 310.427 EN 12/14 PR\454595EN.doc procedure-related comments must be made. Since the proposal for a decision has no effect on the Community budget but, rather, on resources made available by the Member States under the Lomé Convention and on the EIB’s own resources, Parliament has not been consulted officially and has merely been sent the document for information purposes. Indeed, the Council has already adopted the position (it did so at its meeting of 14 May 2001; the document was forwarded to Parliament on 25 April 2001) with a view to the holding of the Third UN Conference on the Least-Developed Countries (14-20 May 2001). Although Parliament has no powers where the EDF is concerned, it does receive financial information thereon each year and it is responsible for granting annual approval of the Commission’s management in respect of EDF implementation. In view of the wish to see the EDF included in the Community budget and the precedent whereby the Council has freely chosen to consult Parliament regarding the financial rules applicable to the development initiatives financed under the Lomé Convention, your rapporteur considers that the Council could have consulted Parliament when drawing up the proposal. In any event, implementation of the proposed measure requires authorisation from the ACP, since there are 60 million euros’ worth of EDF funds involved – although it may be inferred from the discussions which took place during the 6 December ACP Council of Ministers meeting that the Commission has already implemented the decision without awaiting the joint decision. Furthermore, the ACP Council of Ministers has expressed its concern at what is becoming a habit on the Commission’s part, namely awarding unassigned EDF Funds without consulting the ACP Group and without taking into account the rules governing the decisionmaking process. It is important that, in proceedings of this type, all the rules applicable in the decision-making process be observed. Debt management in the future In view of the major impact which a high degree of indebtedness has on the development of the countries affected, debt management assistance should be part and parcel of debt-relief programmes, since this is in the interests of creditors themselves and of the financial markets. In future the problem of indebtedness must be prevented from recurring by means of adequate funding of programmes and projects. There is not much point in continuing to grant funding if there are doubts regarding a country’s ability to make repayments, and particular attention should be devoted to countries affected by natural disasters or those which are emerging from a war. The HIPC initiative is restricted to the most severe cases but it will not solve the debt problem, since there are middle-income countries which could in future find themselves in a similar situation and be in need of aid. For this reason, assistance would be advisable as a means of helping countries to manage their debts (both internal and external) more effectively. It should be borne in mind that both the Lomé Convention (Article 241) and the Cotonou PR\454595EN.doc 13/14 PE 310.427 EN Agreement (Article 66) provide for the provision of technical assistance to the ACP countries in order to help them manage their debt (including internal debt) and deal with debt-servicing and balance-of-payments problems, so that they are able to monitor the public-sector external loans more effectively and supervise the private-sector loans. In this connection the Commission and the Member States should set up a formal system which would enable advantage to be taken, for example, of the special relations which may exist between a Member State and one of the poorest ACP countries, so that the latter country’s management of its debt can be jointly monitored directly, with an eye to ensuring that the principles of good governance are observed and that the financial benefits derived from lower debt-servicing costs are invested in poverty-reduction initiatives. The system should include on-the-spot checks. Poverty-reduction efforts must be monitored in order to ensure that funding allocation, debt relief, aid and new funding all have the desired effect; the National Partnership Facilities launched by the UNDP are a sound move in this direction. The parliaments and organised civil society in the countries affected have an important role to play in monitoring the new funding. Furthermore, debt relief must not constitute a pretext for reducing development aid, since effective development aid is the best solution to the debt problem. PE 310.427 EN 14/14 PR\454595EN.doc