On the eve of Friday’s meeting by G7 finance ministers in Iqaluit, Canada, 94 members of the House of Representatives sent a letter to Treasury Secretary Timothy Geithner that also called for “the provision of assistance to Haiti in the form of grants so that the country does not accumulate additional debts.”

That call was echoed by a several non-governmental organisations (NGOs), including Oxfam, Jubilee USA, and Avaaz, which said they plan to deliver hundreds of thousands of individual signatures on petitions appealing for debt cancellation from across the world to this weekend’s ministerial meeting.

“(While) the international community has acted rapidly and generously to provide for Haiti’s immediate emergency needs,” said Emma Seery, Oxfam’s campaign manager, “the G7 must now also make sure that Haiti is not left saddled with crippling debts as it recovers and rebuilds.”

“They must agree to all new financial support being in the form of grants, not loans, and commit to a clear plan to cancel what remains of Haiti’s debt,” she said.

The push on the G7, which, in addition to the U.S., includes Canada, France, Britain, Germany, Italy and Japan, comes as Haiti struggles to clean up and begin recovering from the cataclysmic Jan. 12 earthquake that is estimated to have killed at least 150,000 people, and possibly tens of thousands more.

In addition to damaging much of the country’s infrastructure, the quake, the most lethal in the Americas’ recorded history, also rendered nearly one million of its nearly 10 million people homeless, creating unprecedented challenges for the government of President Rene Preval, humanitarian NGOs and foreign aid groups, and more than 20,000 U.S. troops and U.N. peacekeepers.

With the vast majority of the population living on less than two U.S. dollars a day before the earthquake, Haiti has long been the western hemisphere’s poorest country. The quake was the latest in a series of natural disasters, including devastating hurricanes in 2008.

Last June, 1.2 billion dollars in Haiti’s external debt, including that owed to the Washington-based International Monetary Fund (IMF), World Bank, and Inter-American Development Bank (IDB), was cancelled after the Preval government completed a three-year Heavily Indebted Poor Countries (HIPC) programme.

Over half of that debt had been incurred by Haiti’s dictatorships, notably the Duvalier dynasty that ruled the country from 1957 to 1986.

But the cancellation covered debt incurred by Haiti only through 2004. In the last five years, the country has received new loans – some of them to help it recover from the floods and other hurricane damage – totalling another 1.05 billion dollars.

Some two-thirds of that total is owed to multilateral agencies, including some 447 million dollars to the IDB, 39 million dollars to the World Bank, and some 165 million dollars to the IMF.

The remainder is bilateral debt, most of it owed to Taiwan (92 million dollars) and Venezuela (167 million dollars). Haiti also owes the Rome-based International Fund for Agricultural Development (IFAD) another 58 million dollars.

While the terms of the multilateral loans are concessional – most of them carry only nominal interest rates and can be repaid over as much as 50 years – servicing of the IMF and IDB loans by themselves alone would normally require Haiti to pay more than 100 million dollars over the next decade, a sum that it can ill afford in the wake of last month’s earthquake, according to the NGOs.

Oxfam and the Jubilee USA Network, veterans in the campaign to gain debt relief for the world’s poorest countries, began calling for comprehensive debt cancellation immediately after the earthquake.

In the days following the earthquake, officials at the IMF, the World Bank, and the IDB – whose governing boards are dominated by the G7 countries – said they were sympathetic to that appeal.

On Jan. 21, the World Bank announced a waiver of Haiti’s pending debt payment for five years and said it would explore ways that the remaining debt could be cancelled. The IDB has said it is engaged in a similar effort and will present alternatives for reducing or cancelling the debt to its board of governors.

On Jan. 27, the IMF, which lacks the authority to provide outright grants, announced that it would give Haiti a 102 million-dollar loan at zero-percent interest and that would not be subject to any of the Fund’s usual performance conditions.

Last week, all three international lenders reported to an emergency donors’ conference in Montreal on debt relief for Haiti, but no further announcements were forthcoming.

In their letter, the lawmakers, who were led by California Democratic Congresswoman Maxine Waters and Florida Republican Ileana Ros-Lehtinen, called on Geithner to push hard on his colleagues.

“We welcome recent statements from officials at the multilateral financial institutions of their intentions to consider cancellation of Haiti’s remaining debts,” the letter stated.

“We urge you to use the voice and vote of the United States on the Executive Boards of these institutions to secure cancellation of all of Haiti’s remaining multilateral debts. While arrangements are worked out for cancellation, we urge you to support a moratorium on debt service payments from Haiti to these institutions, without the accrual of interest.”

Melinda St. Louis, Jubilee’s deputy director, said action was urgent.

“This weekend the G7 finance ministers must respond to the mounting global consensus to drop Haiti’s debt,” she said. “It’s time our leaders announced their commitment to cancel Haiti’s debts once and for all, including the new IMF loan. Debt cancellation is a critical step in the long road to Haiti’s recovery.”

Jim Lobe is a political analyst with Foreign Policy In Focus (online at www.fpif.org). He also writes regularly for Inter Press Service.

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