Rich urged to waive poor's debts to help tackle global downturn

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FE Report
A national network of grass-root charities Sunday urged the rich nations to cancel Bangladesh's all outstanding external debts to help the country weather the fallout of global economic meltdown.
Sushasoner Jonny Procharavizan (SUPRO) or Campaign for Good Governance made the call at a press briefing in Dhaka, a day before a key conclave of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) kicks off in the capital.
SUPRO chairperson Abdul Awal said Bangladesh's outstanding external debt stood at US$ 20713.1 million as of June 2007, 97 per cent of which were mid and long terms. Per capita debt has also soared to $147.32, up from a meagre $6.56 in 1974.
"Bangladesh repays 1.5 dollar for every single dollar it borrows from the external sources. Some 65 per cent of its foreign aid is spent in paying back the previous external debts," Awal said, reading out a statement.
He said in the 2007 financial year, Bangladesh paid US$1551.3 million as foreign debts, which was 18 per cent of the government's total annual spending.
"We could have used the huge amount of money in education and health," said Mr. Awal, adding the government's expenditure in the two key human development sectors were only 16.5 per cent and 7.4 per cent of the total development outlay.
Bangladesh will spend 13.9 per cent of its Tk 1,13,8 billion annual budget in the current fiscal year to repay external loans.
The SUPRO chief said development assistance would do no good to countries like Bangladesh unless the external credit was waived unconditionally.
He branded the World Bank's debt sustainability estimation as faulty, which is calculated on the proportion of gross domestic product and loan repayment.
Mr. Awal said food crisis and high cost of living have aggravated poverty in Bangladesh, denting the country's efforts to achieve its millennium development goals (MDG) by 2015.
He said the developed countries have unveiled a slew of stimulus packages to combat the global downturn, which had in turn adversely affected development assistance to the poor countries.