GROUP OF 7: FAILURE ON DEBT "OUTRAGEOUS"

6:50 AM Jul 2, 1996

GROUP OF 7: FAILURE ON DEBT "OUTRAGEOUS"
Geneva 1 July (TWN) -- The failure of the Group of 7 to agree on new measures to reduce the debt burden of developing countries has been criticised by the international development group, Oxfam International, as "outrageous" and "scandalous". Oxfam has been among the NGOs who have been campaigning on the issue of debt burden of developing countries and particularly the debt they owe to the multilateral institutions (IMF and World Bank) as well as to regional development banks.

Justin Forsyth of Oxfam International said: "It is outrageous that G7 leaders can summon the political will overnight to agree a forty point plan on terrorism but even after two years cannot agree to sell a tiny portion of the massive $40 bn of gold reserves to help the poorest countries in the world."

Carolyn Culey of Oxfam UK added: "The outcome of the Lyons Summit is a disappointment for the world's poor. The Lyons Summit presented G7 leaders with a golden opportunity to take action on Third World debt. They could also have agreed on generous terms for reducing bilateral debt"

She added "It's scandalous that after months of negotiations, no agreement has been reached. By failing to take a lead, the G7 is jeopardizing the chance of a final agreement on a solution to the debt crisis at the IMF/World Bank meeting in September. "

Oxfam also expressed concern over G-7 agreement to use ESAF as the basis for the IMF's contribution to debt reduction.

"IMF loans have helped to create this massive debt problem. What we need is gold sales to pay off the debts, not to fund further lending to severely indebted countries" an Oxfam statement said..