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To: Brazilian and International agencies and persons participating in the
Internacional Jubilee 2000 Coalition
From: Marcos Arruda
Rio, 4/May/99
Dear friends,
The national coordination of the Brazilian Debt Tribunal made us
responsible to share with you the text of the Verdict, just
translated into
English. We invite you to make it as widely known as possible, including
through the media to which you have access.
The Tribunal is a landmark in the struggle for justice and a humanized
world. It was attended by nearly 2,000 people who gave the Verdict a
standing ovation and endorsed it with their signatures.
The Campaign continues and soon we will inform you of the next steps
to be
taken. We are discussing with other Latin American members of the
Campaign
the idea of other countries of the continent organizing similar
tribunals,
and later, also the idea of a Latin American/Caribbean Tribunal on the
Foreign Debt.
With warm regards, in solidarity,
Marcos Arruda and Sandra Quintela
-------------------------------------------------
FOREIGN DEBT TRIBUNAL
- VERDICT -
The FOREIGN DEBT TRIBUNAL met from April 26th to 28th , 1999, at
the João
Caetano Theater in Rio de Janeiro, Brazil, the site where the
Independence
hero and martyr, Tiradentes, was hanged. Some one thousand two hundred
people from various parts of Brazil and other countries around the world
attended and participated in the event. Organized by the National
Conference of Bishops of Brazil (CNBB) and Caritas, the National
Council of
Christian Churches (CONIC), the Ecumenical Service Coordination Bureau
(CESE), the Popular Movements Center (CMP) and the Movement of Landless
Rural Workers (MST), and the Institute of Brazilian Lawyers (IAB),
with the
support of CORECON/RJ, SENGE/RJ, SINDECON/RJ, IERJ, Koinonia and
PACS, the
Tribunal convened to hear the case of Brazil's foreign debt and to
reinforce the Jubilee 2000 Campaign to cancel the debt of the most
heavily
indebted, lowest income countries.
Brazil, along with other Latin American and Caribbean countries, is
considered an "emerging" nation with a medium income level. Its income
distribution profile, however, is among the worst in the world, with one
quarter of its population - that is, 40 million people - below the
poverty
line. The Tribunal was thus called on to identify the relationship
between
Brazil's foreign debt and this situation of injustice and misery. In
addition to pinpointing the factors that lead to and constitute the
foreign
debt, and then cause it to grow out of all proportion, and to identifying
those responsible for it, the purpose of the Tribunal was to define
alternative policies and strategies of action for sustainable means to
surmount the crisis of foreign indebtedness and its social and
environmental consequences.
After four sessions, in which an extensive and diverse body of documented
material was submitted and testimony and declarations heard from
Brazilians
and specialists from other countries - on the international financial
system, on Brazil's indebtedness, on illustrative cases of
indebtedness in
other countries, and on prospects for action to confront and overcome the
Brazilian debt crisis - this People's Tribunal, constituted by
representatives of various sectors of the Brazilian public, reached the
following verdict:
WHEREAS
1. According to the studies and figures submitted to the Tribunal,
the debt
of the poorest, most heavily indebted countries has already been
paid, and
in current accounting terms, cannot be paid;
2. Since last rescheduled five years ago, Brazil's debt has
increased from
US$ 148 billion at year end 1994 to US$ 270 billion in March 1999,
while in
the same period, around US$ 126 billion was paid to foreign
creditors. This
rate of borrowing is unsustainable to the point that almost all new
contracts are tied to servicing the existing debt, thus closing a vicious
circle of indebtedness;
3. The USA's unilateral decision at the end of the 70s to raise interest
rates from their historic levels of between 4 and 6 percent to more
than 20
percent, in only a few months, constituted a betrayal of good faith
in the
contracts and, in addition to forcing debtor countries to take out new
loans in order to pay interest, entailed additional payments which meant
losses of US$ 106 billion for Latin America;
4. The fact that creditors impose a risk premium on debtors so as to
cover
themselves against possible inability to pay entitles the latter to
declare
themselves insolvent without onus;
5. Governments aligned with major corporations and banks with
foreign debts
have made a practice of nationalizing private foreign debt and
socializing
the related costs, thus committing public funds still further to
servicing
the foreign debt;
6. Strategic public enterprises have been used as instruments for
excessive
borrowing, thus compromising their financial health and capacity for
investment, which has served as a pretext for later privatization;
7. There exists a clear connection among foreign debt, excessive internal
public borrowing and efforts to attract short-term foreign capital, which
is subjecting Brazil to a policy of extremely high interest rates;
8. As the Brazilian government regards the financial system as an
absolute
and an end in itself, it has sacrificed the part of the budget earmarked
for social policy spending and for invigorating the domestic economy in
order to keep financial debt payments up to date. As a result it has
abandoned health, education, policies for employment, for the demarcation
of indigenous lands and to ensure conditions for the survival of
indigenous
peoples, to give due value to the elderly and children, to carry out
agrarian reform, and to conserve and restore the environment;
9. The IMF's economic and adjustment policies have proven disastrous for
countries subjected to them and serve to increase still further those
countries' debt and other foreign liabilities, thus constituting a
moratorium without end on the social and environmental debts, whose
creditors are our children, working women and men of the cities and
countryside, blacks, indigenous peoples and Nature;
10. The USA manipulates the UN, WTO, IMF, World Bank and NATO to suit its
strategies to dominate and control the peoples of the world;
11. Brazilian public borrowing has always favored the interests and
privileges of the dominant élites;
12. Brazil's excessive indebtedness was generated particularly in
the last
three decades, which were marked by 21 years of dictatorship and by a
transition to civil governments which completed and connived with the
surrender of economic policy to financial capital;
13. This indebtedness was constituted by dictatorial - and thus
illegitimate and anti-popular - governments, and their creditors, besides
serving as their accomplices, were aware of the risks attendant on these
loans;
14. The expansion of the debt is connected with these élites' connivance
with foreign private, governmental and multilateral financial
institutions;
15. The foreign debt constitutes an ongoing violation of the
International
Covenant on Economic, Social and Cultural Rights drawn up by the UN on
December 16, 1966, which calls for recognition of each nations' right to
self-determination, to freely pursue its economic development and dispose
freely of its natural wealth and resources, and also requires that in no
case may a people be deprived of its own means of subsistence;
THE MEMBERS OF THE FOREIGN DEBT TRIBUNAL HEREBY FIND UNANIMOUSLY THAT:
Brazil's foreign debt was constituted in breach of Brazilian and
international law, and without consulting the Brazilian public. It has
favored the élites almost exclusively to the detriment of the majority of
the population and is prejudicial to national sovereignty. It is
therefore
ethically, legally and politically unjust and unsustainable. In real
terms
it has already been paid and persists only as a mechanism for subjecting
and enslaving society to the financial power of usurers and globalized
capital, and for transferring wealth to the creditors. For these reasons,
this Tribunal condemns the Brazilian debt process, which entails
subordination to the interests of international financial capital and the
wealthy countries, backed by the multilateral organizations, as grossly
unjust and illegitimate. It holds the dominant élites responsible for the
excessive borrowing and for having abdicated from any development plan of
Brazil's own. It holds responsible the governments and politicians who
support and further plans to assign Brazil a subordinate position in the
globalized economy. It holds responsible those economists, jurists,
artists
and intellectuals who provide them with technical and ideological
underpinning. It holds responsible the dictatorship of the major
media that
endeavor to legitimize the debt and stifle debate over alternatives.
It also hereby resolves to communicate this decision to Brazil's
legislative, executive and judiciary authorities at the federal,
state and
municipal levels, that they respect it for the legitimacy of this
Tribunal's structure and social function.
Taking upon itself the hope embodied in peoples' struggles for
alternatives
in their livelihoods, social relations, and economic and social
organization, this Tribunal proposes to all the women and men of
Brazil the
following commitments and strategies for action:
* The union of all peoples in favor of a general and unrestricted
canceling
of the foreign debts of the most heavily indebted poor countries, the
return of the wealth pillaged from them, with no conditions attached
other
than that the resources so saved be applied to paying off the social
debts
under the oversight of society itself, and that the human rights of all
citizens be respected in full.
* An audit of the public foreign debt and of the whole process of
Brazil's
indebtedness, with the active participation of civil society, so as to
ascertain in accounting and legal terms whether there is still debt to be
paid, from whom it should be collected, and to establish democratic rules
for overseeing borrowing.
* A sovereign moratorium, denunciation of the Agreement with the IMF and
redefinition of the debts in line with the audit results and with
strengthening national sovereignty.
* A development policy centered on the rights of the person and society,
built chiefly on Brazil's own material and human resources, and going
beyond the current logic and practice of irresponsible borrowing.
* Firm exchange controls, which equip the government to restrain
speculation and re-encourage investment in production, including
effective
mechanisms to control and inspect all the illegal forms in which
Brazilian
and foreign currencies, and goods in general, enter and leave the
country.
* The re-nationalization and democratization of strategic enterprises.
* The rescheduling of state and municipal debts, with the resources so
saved tied to repayment of social and environmental debts, and the
refounding of Brazil's federative pact on a democratic,
participatory basis.
* Reinforcement of mobilizations and campaigns such as ATTAC, which
demand
that mechanisms be set up to regulate and tax the circulation of
international speculative capital, with a view of creating a fund
earmarked
for restoring those most impoverished to a decent life.
* The union of Latin America and the Caribbean peoples in support of
common
alternative policies and strategies for the continent, in order to
confront
together the vicious circle of indebtedness and the other factors of
impoverishment and subordination that afflict the whole continent.
* Participation of the Jubilee 2000 Campaign, the World Council of
Churches
and other Brazilian and international institutions, in a
mobilization that
will lead democratic States to propose to the UN General Assembly a joint
suit be brought before the International Court of Justice at The Hague to
judge both the processes that gave rise to and hypertrophied the foreign
debt of the heavily indebted impoverished countries, and those
responsible.
This Tribunal is a symbolic milestone on a long march. It therefore calls
on all Brazilian men and women to join, in hope and without fear, in the
initiatives that will grow out of this judgement and to continue to take
their stand, in the streets and public places, until we manage to make
Brazil truly a motherland for us all, one that offers to all the means to
live a life of dignity and full citizenship.
This is our decision. Let it be published and proclaimed. Subscription is
hereby authorized to none but all men and women of good faith.
Rio de Janeiro, Tiradentes Gallows, April 28th, 1999