Campaigners set up ‘waiting room’ outside Blackrock over failure to cancel Zambia’s debt

Campaigners set up ‘waiting room’ outside Blackrock over failure to cancel Zambia’s debt

Date: 21 September 2022
Campaigns: Debt

PHOTOS (credit Jess Hurd): https://bit.ly/3BX8ZuX

  • Activists set up portable waiting room outside asset manager’s office demanding a response to calls from Zambian civil society for debt relief
  • Over 10,000 members of the public signed petition in support of Zambian demands which was handed in to Blackrock’s offices
  • Blackrock, Zambia’s largest bondholder, is set to make 110% profit on Zambian bonds if paid back in full
  • Zambia’s debt payments are more than is spent on health, education, sanitation and social protections combined
  • Campaigners also call on the UK government to introduce legislation to ensure that private lenders participate in internationally agreed debt relief

Campaigners calling on private lenders to cancel Zambia’s debt set up a “waiting room” protest outside Blackrock’s offices on Wednesday

Participants in the demonstration, organised by Debt Justice, Global Justice Now, Christian Aid, Action for Southern Africa (ACTSA) and CAFOD, sat in and queued outside the dentist’s office-style waiting room, waiting for a response from Blackrock to calls for debt cancellation that have so far gone completely ignored.

The protest comes at a crucial time in ongoing debt restructuring negotiations between Zambia and its creditors. In August, government creditors agreed in principle to restructure the debt, and the IMF agreed a $1.3 billion loan which is dependent on a restructuring with private lenders[1].

Blackrock is Zambia’s largest bondholder and could play a crucial role in securing a fair restructuring deal for Zambia. Instead, if it is paid in full, it could make 110% profit for itself and its clients[2].

Since the beginning of the Covid-19 pandemic, there has been widespread support for private sector participation in debt relief. David Malpass, head of the World Bank, has argued that “throughout history there have been occasions where there needs to be deep debt reduction, and this clearly is one of those occasions”. The heads of the UN and IMF have also voiced their support.

Heidi Chow, Executive Director at Debt Justice said:

”Zambia cannot afford to wait any longer – the country urgently needs debt cancellation to cope with soaring food and energy prices and to fight the climate emergency. Lenders like Blackrock charged high interest rates because they said the loans were risky. Now that they have lost their bet, instead of profiteering from a debt crisis, Blackrock should take responsibility and cancel the debt.”

Daniel Willis, finance campaigner at Global Justice Now, said:

“Blackrock’s CEO Larry Fink has gained a reputation for talking up the need for sustainable investment, but there is nothing sustainable about profiteering from Zambia’s debt crisis. The Zambian people have waited too long for an answer from Blackrock. It’s time that Blackrock responded to the calls from the IMF, World Bank, and Zambian civil society, and cancelled Zambia’s debt.”

Pete Moorey, Head of UK Advocacy at Christian Aid, said: 

“Big investment companies like Blackrock are making a fortune and yet too many countries in the global south cannot pay for critical public services or the impact of climate change due to excessive debt payments. This injustice is pushing more and more people into poverty.  The only way to get a fair deal for the people of Zambia is to get Blackrock to the negotiating table. Blackrock must listen and act on these calls.”

Chitra Karve, Chairperson at ACTSA said:

“Zambia, like other Southern African states, remains constrained by decades of disadvantage resulting from colonialism. Unfair debt is yet another limitation on Zambia’s development by Western powers.  We are in a new era of British history: I would like to see this era as one which rights historical wrongs.  ACTSA urges the UK government, banks and other institutions to stop creating new burdens. Now more than ever Blackrock should be held accountable for their tactics and must cancel this debt.”

Graham Gordon, Head of Public Policy at CAFOD said:

“Blackrock is crippling Zambia with debt they’ll never be able to repay, leaving the country unable to invest in improving the lives of their people. Blackrock need to stop hiding from their responsibility and cancel Zambia’s debt.”

ENDS

NOTES

[1] ‘Crisis-hit Zambia secures $1.3 billion IMF loan to rebuild stricken economy’, Guardian https://www.theguardian.com/global-development/2022/sep/02/crisis-hit-zambia-secures-13bn-imf-loan-to-rebuild-stricken-economy

[2] ‘Blackrock urged to delay debt payments from crisis-torn Zambia’, Guardian https://www.theguardian.com/world/2022/apr/11/blackrock-urged-to-delay-debt-repayments-from-crisis-torn-zambia

Photo: Jess Hurd