More than 100 organisations from around the world are calling for debt payments of developing countries to be dropped this year.
The countries include the world’s poorest economies who are struggling with the impact of coronavirus.
Major charities including Oxfam and ActionAid International are asking for the debt relief, which would free-up more than $25bn (£20bn) this year.
They have written to the world leaders and major central banks calling for a range of debt relief measures.
The call is being spearheaded by UK-based charity Jubilee Debt Campaign and came just before a due meeting of the G20 group of the world’s largest and fasted-growing economies.
Sarah-Jane Clifton, director of the Jubilee Debt Campaign said: “Developing countries are being hit by an unprecedented economic shock, and at the same time facing an urgent health emergency.
“The suspension of debt payments called for by the IMF (International Monetary Fund) and World Bank saves money now, but kicks the van down the road and avoids actually dealing with the problem of spiralling debt”.
The campaigners want debt payments to be cancelled with immediate effect, including payments to private creditors.
“This is the fasted way to keep money in countries in responding to coronavirus and to ensure that public money is not wasted bailing out the profits of rich and privileged speculators”, Ms Clifton added.
During the Covid-19 pandemic, campaigners want debt relief to be applied for all countries in need and urgently for the poorest countries.
Looking long-term, they want a process to reduce debt to a sustainable level once the crisis is over.
This involves asking the IMF to introduce clear guidelines on when a debt is unsustainable and follow its policy only to lend to countries with unsustainable debts if there is a default or debt restructuring plan in place.
