Dear New York State Legislators:
We write to request that you pass legislation to protect taxpayers, address economic shocks and support debt relief for developing countries suffering the pandemic economic and health shocks and the Ukraine war food and energy impacts.
As the world enters its third year since the pandemic triggered the worst economic crisis since World War II, developing countries' debt is at a 50-year high. Half of them spend a quarter of their revenue or more on debt payments. Private creditors, holding more than 60% of developing countries’ debt, refuse to participate in debt relief initiatives set by world leaders. When debt restructurings occur, private creditors average a 20% higher return than their taxpayer-funded peers.
More than one-half of sovereign debt contracts are issued under NY law. New York State legislation requiring equitable debt restructuring can make money accessible to developing countries for essential health and social services, including vaccines and food, energy and environmental protection programs.
Pope John Paul II and diverse faith-based leaders championed debt forgiveness for poor countries, and it has been a longstanding US policy with bipartisan support ever since.
Tax money – including from New Yorkers – funds the US participation in debt relief initiatives. Lack of private creditor participation in international debt relief initiatives risks undermining public support, and bringing the debt restructuring system to a halt. This would extend debt crises, with resulting supply shocks, humanitarian crisis and health and social impacts that harm our markets, citizens and consumers.
NY is the primary jurisdiction for developing market bonds and the world's financial capital.Prompt enactment of NY legislation to ensure private creditors contribute their share in international debt relief initiatives helps address the urgent needs of vulnerable people and promote the resilience of developing nations, while safeguarding economic and market stability at home.
Read our two pager for more information here.
If you have any questions, contact Jubilee USA Network via email at abby@jubileeusa.org or by phone at (202) 430-6975.
