U.S. Legislation Seeks to Alleviate Haiti?s Financial Woes

Maxine WatersA bill authored by Congresswoman Maxine Waters (D-Calif.) and signed into law by President Barack Obama will significantly reduce, if not eliminate, the hundreds of millions of dollars Haiti owes to neighboring nations. Without the burden of staggering international debt, Haiti can begin to focus on efforts to rebuild its education, healthcare, and infrastructure systems, which were devastated by a 7.0 magnitude earthquake in January.

?Our government will work closely with the multilateral development institutions to ensure that they cancel all of Haiti?s debts owed to them, and that future aid over the next few years is delivered in the form of grants, so that Haiti does not accumulate more debt,? Waters said of The Debt Relief for Earthquake Recovery in Haiti Act (H.R. 4573).??????????

While this is good news for Haiti, the cancellation of the debt will not happen overnight. Multilateral institutions are not bound by U.S. legislature and it will take time for each to reach a decision on writing off the debt. These processes may involve summoning up boards of directors, or convening with key people to make a vote. However, a spokesman for Waters says that so far there has been a positive response worldwide, with some countries already announcing that they will cancel Haiti?s debt and others are in talks of granting debt relief.

?U.S. officials plan to use their influence and clout to encourage the international community to rally around the bill,? the spokesman told The Network Journal.?
Waters, who serves on the Financial Services Subcommittee on International Monetary Policy and Trade, has championed debt relief for poor countries. Three years ago, she introduced the Jubilee Act for Responsible Lending and Expanded Debt Cancellation of 2007, which increased the number and quality of debt cancellation programs made available to some of the world?s poorest countries. The act requires the Treasury? Secretary to take action to end the predatory practices of ?vulture funds,? the private investment funds that buy up the debts of impoverished countries at reduced prices just before these countries receive debt cancellation and then sue these countries to recover the original value of the debts plus interest.
Following the recent International Donors? Conference for Haiti at the United Nations, where leaders and representatives of some of the world?s wealthiest nations pledged $9.9 billion in aid, surpassing Haiti?s own goal of $3.9 billion, Waters said:? ?The U.S. government?s support for Haiti is clear. Both chambers of Congress have passed legislation I authored to cancel Haiti?s debt held by international financial institutions, and the money pledged by the U.S. at the conference is an impressive addition to the $1 billion our country has already committed to Haiti.?

Waters, who attended the conference, added that she ?will be assisting Haitian small business people and nongovernmental organizations in forming partnerships with the United States Agency for International Development so that they have a substantive role in the rebuilding of their country?.