In the midst of the African debt crisis in the mid-1980s, then-Tanzanian President Julius Nyerere asked the country's creditors a simple question: “Do we have to starve our people to pay our debts? ”.
The finance ministers of many of the poorest countries in the world who are taking part in the (virtual) Annual Meetings of the International Monetary Fund and the World Bank these weeks will ask the same question.
Hopefully they will receive a different response than what President Nyerere received.
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When the debt crisis overwhelmed governments across Africa and Latin America in the 1980s, Western governments stood idly by.
Their repayment was achieved by squeezing shrinking economies through austerity programs supervised by financial institutions.
Children suffered the most from the consequences of a lost decade for development, as budgets for health, nutrition, social protection and education were sacrificed, and poverty soared.
The covid-19 pandemic has created perfect storm conditions for a new debt crisis in much of the developing world.
Economic growth has slowed, export earnings have fallen, currencies are depreciating, and reserves are shrinking.
Unlike rich countries, which can borrow generously in their own currency and take advantage of central banks, developing countries have serious difficulties in repaying existing loans, financing new borrowings, and responding to the pandemic.
Again, debt is diverting resources from vital services.
This year and next, the world's poorest countries are expected to pay $ 45 billion to their creditors.
Meeting these payments will mean that more than 40% of those states will spend more on repayments to creditors than on health.
Behind the statistics on debt are the faces of children who are denied the opportunity to fulfill their potential.
We estimate that this year alone, the COVID-19 crisis will push another 117 million children into poverty.
Severe malnutrition is increasing.
Meanwhile, the disruption of health services could result in another half a million deaths of children under the age of five as deadly diseases such as malaria, pneumonia and diarrhea go untreated.
School dropouts have skyrocketed in a context in which poverty pushes minors into labor markets or early marriages, a fate that threatens millions of adolescents.
Developing countries have serious difficulties repaying existing loans, financing new borrowings and responding to the pandemic
Faced with a crisis of this magnitude, children - not creditors - should be a priority when allocating resources from national budgets.
Organizations like UNICEF and Save the Children can provide support to communities when faced with a crisis.
We can tell the difference.
But there is no possible protection against imminent divestment in children, while growing debt reduces the already narrow fiscal space available to governments and poor households are forced to cut fundamental expenditures, including food.
We can debate the origins of the debt problems of the poorest countries.
Undoubtedly, reckless requests and irresponsible lending have played a role.
It is now clear that too much extra-budgetary debt has accumulated, in many cases secured by mineral exports, under conditions of repayment as opaque as they are burdensome.
But what certainly cannot be debated is our shared responsibility to protect children from a crisis that threatens their future.
The International Monetary Fund and the World Bank have begun to address the debt crisis.
Last spring they got the G-20 to agree to a plan - the Debt Service Suspension Initiative (DSSI) - that grants a six-month moratorium on debt service to 74 of the poorest countries. of the world.
All creditors were called to participate in it.
Not everyone has paid attention.
While most official creditors have suspended collection, commercials have yet to follow suit.
The issue is not unimportant, as commercial creditors - primarily sovereign debt holders - account for nearly a third of the debt service bill.
Unequal participation in DSSI is not the only problem.
Some countries not eligible for the initiative face equally urgent needs.
On the other hand, the suspension now being offered is the antidote to a temporary liquidity crisis, but not a remedy for the solvency difficulties that many countries currently face.
Zambia recently asked its creditors to restructure debts that had become unpayable by the recession and falling copper prices.
Others are likely to follow.
Of course, debt relief is not an isolated strategy.
Much more should be done to provide affordable financing to countries facing recession.
But, as a recent IMF study has highlighted, delaying relief not only hurts vulnerable populations, but also economies, as well as delaying recovery.
Now is the time for an in-depth debt sustainability review, followed by coordinated action across all creditors to restructure and, where necessary, reduce debt.
In a crisis of this magnitude, children - not creditors - should be a priority when allocating resources from national budgets
This review should take into account, beyond strict debt indicators, our deepest responsibilities.
Almost every country in the world has signed the Convention on the Rights of the Child.
We remind you that this entails the obligation to provide health and well-being to children "to the maximum of available resources ... within the framework of international cooperation."
Allowing debt repayment to hinder efforts to combat growing child poverty, malnutrition, preventable disease and educational disadvantage would violate the spirit and letter of a convention that defines the best of our shared humanity.
It would represent an act of intergenerational injustice.
We urge creditor and debtor countries to work together to turn today's debt burden into investments in the children who represent the future of their countries.
The initiative that ended Africa's latest debt crisis required governments to commit to dedicating their debt savings to alleviating poverty.
There is no doubt that establishing an explicit link between reducing debt and spending on protecting children from the consequences of the COVID-19 pandemic and opening up opportunities would stimulate support beyond political differences, even in this era. polarization.
Debt relief can work, as Ecuador's recent experience shows.
Just a few months ago, creditors agreed to restructure $ 17.4 billion in debt, including a 10% shave off of it.
Ecuador's credit credibility has improved.
Because the deepest risk for creditors and debtors does not come from an orderly restructuring, but from the disruption that will follow a wave of disorderly defaults.
The debt crisis confronts the international community as a whole with difficult questions.
There are no easy answers.
But in these challenging times let us remember the bonds that bind us as a human community, and none is more powerful than our shared responsibility for children.
Henrietta Fore
is Executive Director of Unicef.
Kevin Watkins
is Executive Director of Save the Children, UK.
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