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Time to stop the vultures

Posted: March 21st, 2012 | Author: | Filed under: Media | 1 Comment »

The Justice and International Mission  (JIM) unit is asking people to join in a letter writing action to pressure the federal government to address the issue of vulture funds preying on vulnerable countries.

The term ‘vulture funds’ is apt, given that these companies feed from the weakened, struggling economies of developing countries. They trawl the world hunting for indebted countries, buy that debt and then set about ‘calling in’ the loan. Think loan sharks in big offices and fancy suits.

In November 2010, the New South Wales Supreme Court ruled the Democratic Republic of Congo (DRC) had to pay more than $30 million to a New York vulture fund called FG Hemisphere.

The JIM unit is calling on the Australian government to follow Great Britain’s lead and take action to stop these funds from using our courts to exploit poor countries.

Please see below for letter addressed to Foreign Affairs Minister Bob Carr:

Senator the Hon Bob Carr

Minister for Foreign Affairs

PO Box 6022

House of Representatives

Parliament House

Canberra  ACT  2600

Dear Minister,

I welcome the Australian Government’s commitment to international debt relief including the $106.8 million contribution in the 2011-12 budget.

At the same time I am deeply concerned this commitment is under threat of being undermined by a lack of legislation preventing vulture funds from bringing legal action against impoverished countries in Australian courts. I note in November 2010, the NSW Supreme Court forced the Democratic Republic of Congo to pay $30 million to the vulture fund FG Hemisphere.

The Democratic Republic of Congo has 80 per cent of its 66 million population living below the poverty line.

I support the view of UN Independent Expert on Foreign Debt and Human Rights, Dr Cephas Lumina, during his mission to Australia in February 2011:

“It is illogical to grant debt relief to poor countries while at the same time allowing vulture funds to litigate against these countries and thereby dilute the gains from debt relief.”

I note between 1998 and 2008, 54 court cases were instituted by vulture funds across the globe against 12 of the world’s poorest countries for claims amounting to $1.5 billion.

I request that the Australian Government enact legislation similar to the UK’s Debt Relief (Developing Countries) Act 2010. The Debt Relief (Developing Countries) Act 2010 stops the unjust actions of a few unscrupulous companies having a huge impact upon the futures of some of the poorest countries in the world.

Yours sincerely,