UN ‎Debates Debt and Tax Prior to Historic Development Conference

UN negotiators struggle to find consensus on debt, trade and tax policies on the last day of scheduled negotiations before heads of state, business leaders and development organizations meet for the July Financing for Development (FfD) conference in Addis Ababa, Ethiopia.

"These meetings offer a rare opportunity to raise needed resources to confront extreme poverty," said Eric LeCompte, executive director of the religious development organization Jubilee USA Network. LeCompte was in New York for the negotiations. "More than a trillion dollars can be raised annually if we win policies that promote responsible lending and curb corruption and tax evasion."

In 2013, developing countries spent $680 billion paying off debt but received just $134 billion in official aid, according to the World Bank and the Organization for Economic Cooperation and Development. A key issue in the FfD debt negotiations is responsible lending and borrowing. The United Nations Conference on Trade and Development developed principles for responsible lending and borrowing that could be endorsed in the final Financing for Development agreement.

"Publicly passed budget and lending transparency protects the vulnerable and raises billions in the developing world," said LeCompte, who served on the UN Conference on Trade and Development expert group that created the principles on responsible lending and borrowing. "We strongly urge world leaders adopt these accountable lending and borrowing principles."

The most recent FfD text calls for global efforts to stem revenue lost to crime, corruption and tax evasion. Developing countries lose nearly $1 trillion each year to these "illicit financial flows," and sub-Saharan Africa alone loses $50 billion annually. A new study by the research organization Global Financial Integrity finds that these flows harm the world's poorest countries the most.

"Corruption and tax evasion are thefts from the poor," stated LeCompte.

Read UNCTAD's Principles on Promoting Responsible Sovereign Lending and Borrowing.

Read more about illicit financial flows.

Read more about the Financing for Development process.

Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA has won critical global financial reforms and more than $130 billion in debt relief to benefit the world's poorest people. www.jubileeusa.org

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