Dear Democracy Now! Visitor: We are an independent, ad-free daily news program that serves millions of viewers and listeners each month. Our show is special because we make it our priority to go where the silence is. We put a spotlight on corporate and government abuses of power and lift up the stories of ordinary people working to make change in extraordinary times. We do all of this with just a fraction of the budget and staff of a commercial news show. We do it without ads, corporate sponsorship or government funding. How is this possible? Only with your support. If every visitor to this site in December gave just $10 we could cover our basic operating costs for 2015. Pretty exciting, right? Please do your part today. It takes just a couple of minutes to make sure that Democracy Now! is there for you and everybody else in 2015.

Your Donation: $
Tuesday, February 20, 2007 FULL SHOW | HEADLINES | NEXT: "Illusions of Security: Global Surveillance and...
2007-02-20

Jubilee USA Launches Campaign To Stop Vulture Fund Investors From Profiting Off Debtor Nations in Developing World

DONATE →
This is viewer supported news

In response to Greg Palast’s report last week on BBC and Democracy Now, the debt-relief and economic justice group Jubilee USA is launching a new effort today calling on Debt Advisory International to drop its efforts to collect money from the Zambian government. [includes rush transcript]

We turn now to our continuing coverage of "vulture funds." Vulture funds are Western companies profiting off buying up countries" debts and then forcing those countries to pay off the debt at a far higher price.

Last week BBC investigative journalist Greg Palast exposed on Democracy Now! how one company is trying to collect $40 million dollars from the government of Zambia after buying one of its debts for $4 million dollars. Zambia claims the company, Debt Advisory International, even tried to bribe government officials by offering to make a donation to: "the president’s favorite charity." Palast questioned the company’s owner, Michael Francis Sheehan, about the allegation.

An excerpt of a report from investigative journalist Greg Palast. Well just hours after we aired that story a British court ruled on the case. Zambia was ordered to pay Sheehan’s company $20 million dollars on its original $4 million dollar debt. The Zambian government says the money will have to come directly from its budget for health and education.

Well, an international campaign is emerging to prevent Debt Advisory International from collecting. One day after the ruling, House Judiciary Chair John Conyers appeared on Democracy Now! The Michigan Congressmember said he raised the issue with Present Bush after hearing Palast’s report on our broadcast.

Democratic Congressmember John Conyers. In addition to Congress, pressure is also coming from the grassroots. The debt-relief and economic justice group Jubilee USA Network is launching a new effort today calling on Debt Advisory International to drop its efforts to collect money from the Zambian government.

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: We turn now to our continuing coverage of vulture funds. Vulture funds are Western companies profiting off buying up countries’ debts and then forcing those countries to pay off the debt at a far higher price.

Last week on BBC, investigative journalist Greg Palast exposed on the attempts of one company trying to collect $40 million dollars from the government of Zambia after buying one of its debts for $4 million dollars. Zambia claims the company, Debt Advisory International, even tried to bribe government officials by offering to make a donation to "the president’s favorite charity." Palast questioned the company’s owner, Michael Francis Sheehan, about the allegation. We ran it on Democracy Now!

GREG PALAST: Mr. Sheehan says it wasn’t a bribe. They were only trying to help the Zambian people.

MICHAEL SHEEHAN: We offered to donate debt to a low-income housing initiative, which was a charitable initiative, which did end up building over several thousand houses for the poor. You’re contorting the facts. You’re on my property, and I would ask you to step off.

GREG PALAST: We showed this to the current president’s advisor. He was not impressed.

MARTIN KALUNGA-BANDA: When you are talking about any amount, $40 million or thereabout, to be paid to service some unfair debt, you are talking about in excess of 300,000 children being prevented from going to school.

AMY GOODMAN: An excerpt of the BBC Newsnight report from investigative journalist Greg Palast that we ran on Democracy Now! last Thursday. Hours after we aired the story, a British court ruled on the case. Zambia was ordered to pay Sheehan’s company $20 million dollars on its original $4 million dollar debt. The Zambian government says the money will have to come directly from its budget for health and education.

Well, an international campaign is emerging to prevent Debt Advisory International from collecting. One day after the ruling, House Judiciary Chair John Conyers appeared on Democracy Now! The Michigan Congress member said he raised the issue with Present Bush on Thursday after hearing Palast’s report on our broadcast.

REP. JOHN CONYERS: But it was my job, I felt, to raise the whole question of this bond speculation that goes on at the expense of poor debtor countries, in which their debt is bought up and then they’re sued for the full amount. It’s bought up at pennies on the dollar, and then they’re sued. And I wanted to thank you for revealing this to us, because it allowed me to ask President Bush two questions: one, about Paul Singer and Michael Sheehan; and two, whether he would be willing to stop this incredible misuse of our government’s charity toward funding aid to our poorer nations.

AMY GOODMAN: Democratic Congressmember John Conyers. Paul Singer, by the way, is one of the chief Republican fundraisers in this country for both, well, presidential hopeful Rudy Giuliani, as well as President Bush. In addition to Congress, pressure is also coming from the grassroots. The debt-relief and economic justice group, Jubilee USA, is launching a new effort today, calling on Debt Advisory International to drop its efforts to collect money from the Zambian government.

For more, we go back to Washington, D.C., where we’re joined by Jubilee USA director Kristin Sundell. Welcome to Democracy Now!

KRISTIN SUNDELL: Thank you, Amy. It’s good to be with you.

AMY GOODMAN: Can you talk about what you’re doing with this information?

KRISTIN SUNDELL: Yes. Well, today we are calling on people in the United States to call Debt Advisory International, to call their Washington, D.C. office at (202) 463-2188, and to tell Michael Sheehan, who is the owner of Debt Advisory International and Donegal International, not to take $20 million of the money that was freed up by debt cancellation for the people of Zambia.

AMY GOODMAN: Kristin, what effect does this have on Zambia? Why are you so concerned about this?

KRISTIN SUNDELL: Well, the money that was freed up through debt cancellation for the people of Zambia was the result of ten years of campaigning by people in the global south, in the global north, working together for debt cancellation. And I recently returned from Zambia, where I was a member of a delegation from Jubilee USA to see some of the impacts of debt cancellation there. And we visited hospitals, where user fees have just recently been abolished with the proceeds from debt cancellation. We were told about plans to hire thousands of additional teachers with money freed by debt cancellation. And if Michael Sheehan collects $20 million, that will take fully half of the money that was freed up this year by debt cancellation and would certainly prevent the Zambian government from implementing these plans.

AMY GOODMAN: How exactly does it happen? How does a Western US company get their hands on this debt, and a British court rules on their behalf?

KRISTIN SUNDELL: Well, this dates back to 1999, when Donegal International, a vulture fund, bought up a portion of Zambia’s debt at the bargain-basement price of $3.3 million and then has been holding onto this. And now that Zambia is eligible for debt cancellation, under a deal that was reached at the G8 in 2005, it’s now trying to collect this money, and it originally was trying to collect up to $55 million. The judge ruled that it could collect a maximum of $20 million, and we’ll find out on March 9th exactly how much that they are able to collect from the government of Zambia.

AMY GOODMAN: How typical is this?

KRISTIN SUNDELL: Well, this is something that is just coming to the attention of Jubilee USA and debt campaigners here in the United States. I know that this is also something that’s happened in Peru. It’s something that’s happened in the Congo, as well. And so, we are very concerned, and people around the world who have been working on this issue for the last ten years are very concerned, because the money freed up from debt cancellation is meant to address extreme poverty in the countries, not to go line the pockets of people who are taking advantage, like the vulture funds, and buying up debt and then trying to collect on it later.

AMY GOODMAN: Are you coordinating with the House Judiciary Chair John Conyers, who says he’s calling for an investigation?

KRISTIN SUNDELL: We are also communicating with the office of Representative Conyers, and we’re going to be investigating also, exploring with him what further can be done preemptively, in addition to the efforts that are going on today to put pressure on Michael Sheehan. And I should also say, if people want to fax or email his office today, they can also do that via the Jubilee USA website, which is jubileeusa.org, beginning at 9:00 a.m. Eastern this morning.

AMY GOODMAN: Kristin Sundell, I want to thank you for being with us, outreach coordinator for Jubilee USA Network.

KRISTIN SUNDELL: Thanks, Amy.

AMY GOODMAN: Thank you for joining us from Washington, D.C.

Show Full Transcript ›
‹ Hide Full Transcript

Recent Shows More

Full News Hour

Creative Commons License The original content of this program is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License. Please attribute legal copies of this work to democracynow.org. Some of the work(s) that this program incorporates, however, may be separately licensed. For further information or additional permissions, contact us.