136 UN Member States Seek Fair & Efficient International Bankruptcy Law
At the international level there is no equivalent to national bankruptcy law. To fix this major gap in the international system, Argentina introduced a resolution at the UN General Assembly. This series features clips of that UNGA debate with commentary by Jayati Ghosh.
The US, Canada, Germany Japan, Israel and UK voted against the resolution. Basically the political economy of it is that developed world governments feel they can ensure their banks somehow get repaid. If these governments feel that forcing an agreement on a debtor country that denies citizens’ basic needs, social and economic rights and somehow extract this debt, that this is a feasible way out, it’s not, says Jayati Ghosh
“The Greek crisis has made it clear that individual states acting alone cannot negotiate reasonable conditions for the restructuring of their debt within the current political framework even though these debts are often unsustainable over the long term” state renowned economists
Since the early 1980s Latin American debt crisis, we’ve advocated for clear, consistent, fair rules that allow countries with excess debt to work through that problem in a way that doesn’t damage their people and economy says UNCTAD’s Richard Kozul-Wright
“Just two weeks ago, the Holy Father, Pope Francis, endorsed the bankruptcy process that is taking place here” says Eric LeCompte at the UNGA as he makes the connection between global debt policy and poverty and inequality in the world
You would not ask Citibank to design the bankruptcy law in the US. We know how it would design the law. It would have indentured servitude. Bankruptcy laws that come out of creditors are neither fair nor efficient argues Joseph Stiglitz.