UN Expert Urges Congo to Assess Debt

Posted August 5th, 2011 at 2:20 pm (UTC-5)
Leave a comment

A United Nations expert on foreign debt and human rights has urged the government of the Democratic Republic of Congo to audit the country's debt as a step toward increasing transparency and accountability.

In a statement concluding a 10-day visit to Congo Friday, Cephas Lumina said the government needs a clear picture of the country's debt burden in order to set out a transparent and efficient public debt management system.

Lumina visited the country to assess the impact of the country's external debt on the government's efforts to deliver social services to its people.

He praised the government for implementing policies that led to a budget surplus this year. Congo last year completed a series of steps to make itself eligible to have up to 80 percent of its $13 billion external debt canceled through the World Bank.

But he noted the security situation in parts of the country is still fragile, and other remaining challenges include corruption, transparency in the management of public resources, and equal distribution of the benefits of foreign investment.

Lumina said sustainable development will only be possible if those challenges are addressed.

Lumina also pledged his assistance to Congo in fighting lawsuits generated by so-called “vulture funds.”

Private entities buy the debt of poor countries on secondary markets at a deep discounts, and then institute legal proceedings against the countries to recover the debt. Lumina said these entities can recover “exorbitant” amounts on the debt, sometimes as much as 20 times what they paid.

He said such transactions are “reprehensible” and said he stands ready to assist Congo in its fight against such creditors.