Cancel debt of developing nations due to pandemic: UK MPs

LONDON: Developing countries battling the pandemic should have their debt cancelled by the UK government, MPs have said.

The Commons International Development Committee (IDC) said a “legacy of humanitarian and development reversals and crises could be more catastrophic than the direct impacts of Covid-19 in developing countries”.

“Amid fears of a ‘looming financial tsunami’ for developing countries caused by the pandemic, the IDC argues that debt should be cancelled rather than countries being offered debt relief,” the commitee added in its statement.

On November 13, the G20 group of the world’s biggest economies announced that low-income countries hardest hit by the coronavirus pandemic could get an extension on debt payments beyond mid-2021, and in the most severe cases a debt write-off.

It came a day after more than 1,000 health professionals from 66 countries signed a letter, organised by Oxfam and supported by Doctors’ Association UK, urging world leaders to cancel billions in debt for developing countries.

The signatories of the letter said that many poorer countries, which have been hit hard by the coronavirus crisis, are spending more on repaying debt than on their health services.

IDC chair Sarah Champion MP said humanitarian injustices have become worse due to the pandemic, with Johns Hopkins University reporting almost 100 million coronavirus cases early on Tuesday.

“More girls than ever are out of school, crippling national debt is diverting funding away from crucial social services, treatment for HIV/AIDS has been disrupted and the interruption of other inoculation programmes is a ticking bomb,” Ms Champion said. “We must expose this shadow pandemic and recognise that long after coronavirus, the secondary impacts could be worse. The Government needs to show leadership on this and commit to shore up our decades of investment in development.”