Action Alert 12 Oct 2001

IMF tells starving Nicaraguans to tighten their belts, cuts off debt relief.
SJC asks for support in denouncing IMF behaviour.

The Social Justice Committee asks people to express their dismay that the IMF has stopped the debt relief program for Nicaragua in the midst of crisis. Here is a quick summary, with more information below:

There has been widespread, worsening hunger in Nicaragua since the beginning of the year, with flooding, drought, and collapsing coffee prices hitting the country with a series of devastating blows. A million-and-a-half Central Americans are suffering from hunger following the three-month drought. Floods on Nicaragua’s Atlantic coast destroyed crops of rice, corn, yucca, and bananas, with some 1,400 families now eating the seeds that they used to give to pigs that were swept away by the floods. Their children dying of hunger, 10,000 families have left the coffee plantations where they lived, worked, and grew some of their food, because of the collapse of coffee prices.

Despite the situation of the country, the IMF continues to demand that the Nicaraguan government slash spending, pull money out of circulation, and privatize public utilities. IMF documents released Oct 2 show that IMF staff have decided that Nicaragua has failed to comply with these demands, and the institution has suspended Nicaragua’s debt relief program indefinitely.

This means debt cancellation by rich countries is also put on hold by the IMF decision.
The IMF is refusing to negotiate new support until conditions are met. Without an IMF agreement, development assistance from other sources is endangered.

Please write your representative at IMF, asking to restore the debt reduction program for Nicaragua and de-link IMF structural adjustment conditions from the HIPC program.

Email representatives using initial of first name plus family name: _______@imf.org Example: US Executive Director: Randal Quarles rquarles@imf.org