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To finance development, many poor countries have to take recourse to external loans. By itself this is not bad or dangerous because the debt can be used to , f. i., invest in infrastructure, raising the output of the economy.
But if loans are taken and given without considering the economic capacity of the debtor, the repayment could become a problem. In the 1970s and 1980s this led to the so called “Third World Debt Crisis”. Today we can observe a similar trend: Poor countries in Africa, Asia and Latin America have comparatively easy access to fresh money because low interest rates in the Global North make investments in the Global South very attractive.
Rules for responsible borrowing and lending are important since they make clear, that creditor and debtor share responsibility for the success of the lending operation.
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Hamburg Sustainability Conference: involving private creditors in debt relief through national legislation
Together with the Friedrich-Ebert Foundation and the Friedrich-Naumann Foundation, erlassjahr.de organized a session at the first Hamburg Sustainability Conference (HSC), that was hosted among others by the German government, the city of Hamburg and UNDP and was meant to be one of the summits on the road to the fourth…
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#RejectFinanceBill2024 protests in Kenya – When austerity leads to human rights violations
"Tumechoka!" - "We are tired!" For days, thousands of Kenyans across the country have been protesting against the planned tax increases on essential goods and services. Under the hashtag #RejectFinanceBill2024, young people in particular have called for peaceful protests on social media such as TikTok, Instagram and X (formerly Twitter).…
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