The document analyzes the debt swap for education operations carried out in Spain with Latin America over the past three years. Although it recognizes the potential of this mechanism for development, it shows that at present it is still far from being a changing generator factor. Entreculturas has contributed to this document as member of the Global Campaign for Education and the Fe y Alegría Federation.
From controversy to opportunity
Although the government insists on talking about debt swap for education, the majority of funds are not allocated for this purpose. Only two out of the seven agreements signed so far, El Salvador and Peru, are 100% oriented to this sector. As an example we can take Ecuador, with only 40% allocated to education and 60% do hydroelectric projects.
Organizations point out that at present, amounts allocated for debt for education swaps are scarce and hardly representative, so that its effects on the debt situation of these countries and education improvement are also limited and they denounce that they do not, in any case, reduce the trade debt. Thus, Ecuador, which has a debt of 400 million dollars with Spain, only received 50 million as swap (only 12,5% of the total), out of which 10 million were for future interests.
Organizations signing the document which will be presented at the Civic Encounter parallel to the Summit value positively the Spanish government's support to this initiative, which, if correctly carried out, could have a significant medium and short term impact on life conditions in these developing countries. The document suggests a series of recommendations which governments should take into account if they are committed to engage in an education for all.
The signing organizations demand the following:
- The Ministries of Education and Civil Society should be main actors of these initiatives and not the Spanish and Latin American Ministries of Economy making decisions as it presently occurs.
- Increase funds allocated to debt swaps for education and the applied discount rate. It should be 75% for the Heavily Indebted Poor Countries (HIPC) and up to 50% for the non HIPC countries.
- Untie the debt swap transactions of the purchase of Spanish goods and services as was established by the Debt Law.
- Improve transparency throughout the swap process giving information access to all interested parties all along the process.
- Insure that the other means that are used in cooperation do not undermine the benefits of the swaps for education making them work with the same objectives. This is the case of the subsidized loans that are used in education related projects that are generated by the new debt.
- Invite other Latin American creditor countries to join these initiatives of debt swap transactions.
Signing organizations
The Global Campaign for Education is an international coalition made up of NGOs, teacher organizations, trade unions and social movements engaged in the right to education. The Spanish Coalition of the Campaign (CECME) is promoted by Action Aid, Entreculturas and Intermón Oxfam. http://www.cme-espana.org
The Latin American Network on Debt, Development and Rights (LATINDADD) is made up of institutions and campaigns from 9 Latin American countries which are working on solving the external debt problem and to create conditions to enable the setting up of an economic system at the service of the people.
http://www.latindadd.org
Fe y Alegría is a Popular Education and Social Promotion Movement made up by organizations from 17 countries, associated as an International Federation, that provides education for more than one million people in almost three thousand centres, radio stations and education communities. http://www.feyalegria.org
