McPherse Thompson, Assistant Editor - Business
The Jubilee Debt Campaign (JDC), the United Kingdom-based lobby group for freedom from debt in developing countries, said Jamaica should seek to negotiate a debt cancellation with all its private, multilateral and bilateral creditors.
"Yes, we believe that all Jamaica's creditors should take part in reducing the Government's foreign debt, through debt cancellation. We are calling on ... multilateral, bilateral and private creditors to do so," said Tim Jones, economist and senior policy and campaigns officer for Jubilee Debt Campaign.
Jones said the group has been supporting calls by churches in Grenada for the eastern Caribbean island to negotiate debt reduction with all its creditors.
"We would similarly support Jamaicans making those demands to the Jamaican Government. We would also support calls for an audit into the debt," he added, in emailed responses to queries by Sunday Business.
His comments came following the release by Jubilee of a debt league which compares the foreign debts of countries based on separate calculations from the World Bank, International Monetary Fund (IMF), central banks and OECD databases.
All debts included
The analysis incorporates both public and private debt.
"By showing both government debt and private debt, and how much a country owes as well as it is owed, JDC's net debt table better expresses the fact that crises are not simply created by debtors, but by creditors too," the organisation said.
Jubilee has published four measures of debt figures, which they claim together give a better picture of the true state of indebtedness. In Jamaica's case, using statistics for 2011, it found that the overall international debt burden was 84 per cent of GDP, government payments on foreign debt 33.1 per cent, government foreign debt 54 per cent and private foreign debt 30 per cent of GDP.
Jones, who calculated the figures, is quoted in the debt league report as saying that a country's debt is often counted as the amounts owed by a government.
"But it ignores the debt owed by private companies, including banks, even though that was the main cause of the current financial crisis," he said.
"It is debts owed between countries which are at the root of current crises in Europe, as well as in countries such as Jamaica, Pakistan, and El Salvador. But it takes two to tango; our figures also show the big creditor countries, including Germany, Saudi Arabia, and Norway, whose surplus status is just as much a problem to the global economy. It's the other side of the same coin."
Debt is complex
Jones acknowledged that "no one set of figures can capture all the complexities around debt. The quality of debt is a huge issue; whether debts are used productively and democratically, or are used to fund useless projects, and unrepresentative regimes. There can be no statistical way of measuring this. But these new figures give far more insight than the blinkered view which looks only at government debt, and takes no account of who it is owed to."
A report on guardian.co.uk dated July 1, 2013, said the Grenadian Conference of Churches has proposed that negotiations on reducing the debt should take place with all creditors.
"This would be a major step forward for Grenada, and for dealing with debt problems elsewhere in the world," the report said. Grenada's debts payments are more than 20 per cent of export revenues, it added.
The Conference of Churches was inspired by the biblical concept of cancelling debts: a jubilee, according to the news report, which said the Grenadian government has reacted positively to the proposal and has indicated it would like to negotiate with all creditors.Jubilee said it has called for cancellation of Jamaica's debt since at least 1997 and has documented the country's debt situation in a petition it has submitted to the United Kingdom and the IMF.
However, Jubilee said Jamaica was not made eligible for debt cancellation because it is a middle-income country and "too rich" to qualify.