December 16, 2003

OSLO, Norway/GENEVA - Rev. Angel F. Furlan, president of the United Evangelical Lutheran Church (IELU) in Argentina has stressed the need to investigate how external debts are acquired and utilized.

"Debt management models as discussed today won't resolve the fundamental problem of global corruption. The illegitimate practices will continue, unless they are pursued as illegal and/or criminal acts," said Furlan.

The IELU leader made these remarks when he participated in the October 30-November 2 Norwegian Social Forum in Oslo, organized by representatives of civil society in Norway including participants from developing countries. A guest of "Changemakers," the Norwegian Church Aid (NCA) youth organization, he was invited to speak on the illegitimacy of external debt, and he included examples from Argentina. Furlan is also Moderator of the Bishops' and Presidents' Conference of the Lutheran World Federation (LWF) member churches in Latin America,

Furlan argued that there are different approaches to describe the illegitimacy of [external] debt. In the historic perspective, he noted, the debt builds on a systematic drain of resources from the region that started 500 years ago with Europeans' "discovery" of the American continent. More recently, the role of the International Financial Institutions (IFIs) comes into the picture. In 1976, said Furlan, Argentina's external debt was USD 8 billion. Up to the year 2000, the country had spent more than USD 200 billion in debt servicing, but still owed USD 160 billion. Criticizing the "magical financial mathematics" of the International Monetary Fund, he stated: "We owed 1, we serviced 2, therefore today we owe 3. The more we pay, the more we owe!"

The illegitimacy of this debt, he stressed, can finally also be seen in its negative effect on the vulnerable population of the country, whose basic human rights are simply denied. "The debt can be described as genocidal, which makes it illegitimate," Furlan underlined.

Referring to the cancellation of the so-called "dictatorship debt," a major item on the campaign agenda of "Changemakers," Furlan argued: According to the Argentine constitution, the parliament must approve all loans taken by the government. But since there was no parliament during the 1976 to 1983 military dictatorship, all the credits contracted during this period and the interests accrued thereof are illegal and illegitimate. "We don't even want to discuss debt relief for this part of the debt," he said. "It simply has to be written off!"

But Furlan also underlined the creditors' responsibility in the current debt crises. "The fact that credits were granted illegally shows that corruption is not confined to the circles of bureaucrats and government functionaries in our countries, but touches the heart of the IFIs and commercial banks in the northern hemisphere. They have been accomplices with both illegal and bloody dictatorships, and with corrupt officials of democratic governments," he contended.

Alluding to the theme of the 2003 World Social Forum in Porto Alegre, Brazil, "Another World is Possible," Furlan concluded: "We won't ever succeed in building a different world if it is founded on corruption and impunity. This is why Latin American LWF member churches are interested in debt management that puts the issue of justice at the core of its goals."

The LWF has 13 member churches in Latin America. In various consultations coordinated mainly through the LWF Department for Mission and Development, these churches have been actively engaged in issues concerning economic globalization and international debt, and their impact on societies and people's lives in Latin America.

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