For a fair approach to debt!

Without debt cancellation, the Sustainable Development Goals cannot be achieved!

End hunger and poverty! Preserve livelihoods! Health and education for all! – These are the Sustainable Development Goals that the international community wants to achieve by 2030.

But this will not be possible without comprehensive debt cancellation.

The majority of countries in the Global South are critically indebted, and almost a quarter are highly indebted. These countries often have to invest large sums in debt repayment. There is no money to invest in social sectors such as health, education and poverty reduction, in infrastructure or in measures to cope with climate change. Whether in Zambia, El Salvador or Sri Lanka, the poor and vulnerable groups, such as women and children, suffer most from high debt burdens.

To overcome the debt crisis, over-indebted countries must be given the chance to negotiate their debts under fair and transparent conditions. However, despite calls from academics, civil society and politicians, such a process does not yet exist. Currently, only creditors decide whether and to what extent debt is cancelled. As a result, debt relief is usually too small.

Something has to be done!

The German government has recognised the problem. It wants to support the creation of an insolvency procedure for states. The aim is to enable particularly vulnerable countries to obtain rapid and comprehensive debt relief. In their coalition agreement, the three governing parties have set this goal for the period up to September 2025. It is now up to us to remind them of this promise!

“We support an initiative for a codified international sovereign insolvency procedure that includes all creditors and implements debt relief for particularly vulnerable groups of countries.”

Therefore demands: The coalition agreement must be implemented, a fair and transparent debt resolution mechanism must be created!

This means

  • Countries receive sufficient debt relief to enable them to achieve the Sustainable Development Goals.
  • An independent body, which is neither a debtor nor a creditor, decides in a timely manner on the need for and amount of debt relief.
  • All creditors will be obliged to participate in the necessary debt relief.

Of course, Germany cannot do this alone. But as an economic and political heavyweight, its voice will be heard in powerful international institutions and bodies.

We call on the German Government to …

… to take concrete steps to turn the words of the coalition agreement into action!

Our list of demands (in German only) can be used as a yardstick to measure the credibility and sincerity of the federal government’s efforts. The list of demands sets out policy reforms that can be achieved in this legislative period – towards a process that adequately takes into account not only the rights of creditors, but also those of debtors.

The even more detailed paper “Reform proposals to implement the mandate in the 2021-2025 German coalition agreement to support a sovereign debt workout mechanism”, which we sent to the responsible ministries in August 2023, can be found here (in English).

Further information …

… can be found on our German campaign website