Stop debt vultures suing Ethiopia

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Dear MP [This will automatically change to your MP's name when you enter your postcode]

I’m emailing you as my MP to ask you to push for meaningful action on the debt crisis ahead of the UK G20 presidency.

We’re currently in the worst debt crisis in 35 years, with 54 countries around the world in crisis. As the economic crisis triggered by the conflict in the Middle East takes hold, the situation for countries in debt distress is set to become even more critical.

The key process to support countries in crisis in accessing debt relief - the G20 Common Framework, which was set up during the pandemic - has failed. Only four countries have ever applied: Zambia, Ghana, Chad and Ethiopia. Five years on, all four are still in debt distress or at high risk of being so.

Urgent debt relief is being blocked by the failure of bilateral, multilateral and private creditors to agree on sharing the burden of debt restructurings. The G20 initiatives have neglected to include robust processes to require banks, hedge funds and oil traders to agree as much debt relief as governments.

Nine in ten of the debt contracts between private lenders and lower-income countries are overseen by UK law. As a result, we’re seeing vulture funds pursuing or threatening countries in crisis in the UK courts to make vast profits.

Despite generous proposals by the Ethiopian government, vulture funds are suing Ethiopia in the High Court. Separately the threat of legal action in the UK appears to have strong-armed the Ukrainian government into a deal that will deliver the vulture funds $3.7bn on a debt with an original value of £2.6bn.

The UK’s G20 presidency later this year presents a key opportunity for the government to show leadership on the debt crisis by seeking reforms to the Common Framework to enable more countries to access debt relief and right now the government can pass UK legislation on vulture funds to support these changes.

As my MP, please will you write to the chancellor, Rachel Reeves, to ask for the UK to pass private creditor legislation and use the G20 presidency to seek reforms to the Common Framework?

I look forward to reading your response.

Yours sincerely,

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