Jubilee South adds its voice to the condemnation of “vulture” firms’ despicable manipulation of an already unjust financial economic system.

We denounce G8 governments, the United States and Britain in particular, for allowing these firms to operate in a public legal form, pick up debt claimed from South nations cheaply -when it goes unpaid-, and then avail themselves of the Northern legal system to demand their full value plus interest. The proclamations of G8 leaders in favour of debt relief are rendered even more meaningless by their passiveness in the face of these politically-connected vulture firms in the North. It is well within their power, after all, to enforce the write-off of the same loans.

We commend the campaigns initiated by Jubilee USA and the debt movement in the UK demanding an end to this particularly predatory form of free market capitalism and private enterprise.

Zambia, Peru, and Congo are the best known cases where these firms have made massive profits by using Northern courts to force impoverished South governments to pay, thereby ensuring that these purportedly legal \"investment firms\" obtain returns many times larger than their initial “investment”. In the case of Nicaragua and other countries, the IMF ensures that domestic and international banks be given first claim to alleged “debt relief” savings, converting the already rich bondholders into the real beneficiaries of such “debt relief”. This blatant profiteering is symptomatic of a deeper structural disorder.

We remind South governments that it is in their power and indeed their right and moral obligation to end such a cynical example of crony capitalism. We call on them to take immediate and necessary action. South governments should simply dismiss such claims or legal rulings -- repudiating not only the legal manipulation but the entire debt itself on grounds of illegitimacy. These odious practices must be abolished along with the odious debt itself. Comprehensive and participatory public audits of the debts claimed of South countries would contribute both evidence and heightened public support for such action.

Jubilee South calls on all popular movements and campaigns, North and South, to uphold the right of the peoples of the South to demand cancellation and repudiation of all illegitimate debt. We must all fight to end both vulture firms and the vulture system that continues to uphold debt as an instrument of colonial bondage, exploitation and subservience.

JUBILEE SOUTH
February 27, 2007

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