De Venecia’s debt conversion program gains support from UK

Speaker Jose de Venecia met with senior officials of the British Treasury last Friday to discuss a proposal for large-scale debt-conversion program for debt-saddled nations.

Mark Bowman, head of the British Treasury’s International Poverty Reduction Department, said De Venecia’s debt-to-equity proposal was "interesting" and promised that a technical group will study the proposal in greater detail.

De Venecia and his small delegation from the House of Representatives composed of Reps. Monico Fuentebella, Rolex Suplico, Janette Garin and Ferjenel Biron met with Bowman for one hour.

De Venecia’s debt-conversion program proposes a 50 percent conversion of the foreign debt of the world’s 100 debt-saddled developing countries into equity projects for education, hospital and health care, mass housing, infrastructure, reforestation, clean water, irrigation and post-harvest facilities, eco-tourism and wealth-creating projects.

He said lenders will be major shareholders in a number of priority projects that they would choose.

According to the Speaker, there have been debt-for-equity projects in the past but they were few, small and sporadic.

De Venecia emphasized that the program does not seek debt reduction, discount or cancellation and would not require new loans from the lending countries and financial institutions.

What he is proposing, he stressed, is a strategy to help ease the foreign debt burden of the poorest developing nations in Asia, Africa nd Latin America.

"We all know that the heavy foreign debt burden on many of the poorest and developing countries worldwide does not allow them to significantly fight poverty and achieve the UN Millennium Development Goals," he said. "We propose that Great Britain take the lead in seriously considering this proposal."

The meeting was also attended by Joe Thornton, head of the ministry’s debt-relief branch, and concludes the series of meetings in the British capital where De Venecia made similar appeals for support for his proposal.

Earlier in Paris, following De Venecia’s powerful appeal for support for his initiative, Paris Club president Jean-Pierre Jouyet said he was creating a technical committee to undertake a detailed study of the debt-conversion proposal.

Bowman said they would be involved in the technical work of the Paris Club, which is composed of more than 20 of the world’s wealthiest democracies. Its core group, the G-8, represents the world’s leading industrialized nations that have recently started to explore new strategies to deal with the huge foreign debt burden of the world’s poorest nations.

De Venecia was earlier honored by the French government and given the Officier Legion d’Honneur, the highest decoration founded by Napoleon for his role as a peacemaker and for his initiative for a global interfaith dialogue to heal the Christian-Muslim divide and mediate ethnic and communal conflicts worldwide. The award was also for the wide-ranging economic and financial reforms he helped put in place in the Philippines.

The award was presented by French Minister of Industry Francois Loos on behalf of the French government.

Jean-Louis Debre, president of France’s National Assembly, called De Venecia a "great democrat" in an hour-long talk at the Assembly.

De Venecia also addressed fund managers and investors in London in a major drive to revitalize the Philippine mining industry six months after the Supreme Court declared the Mining Act of 1995 constitutional. Among other things, the law allows up to 100 percent foreign ownership of a large-scale mining project.

De Venecia told the fund managers at the Skinners Hall, site of the Philippine Mining Forum, that the government has identified 23 priority mining projects worth some $6 billion "at which operations can restart quickly."

The revival of the mining industry topped the list of 12 wealth-creating projects De Venecia has identified as sources of new wealth for the country.

He said the government and the House of Representatives "are totally dedicated to the mining industry as a key sector of our economy."

Mining companies wanting to invest, however, must maintain the highest environment standards, act within the law and respect local culture and communities, De Venecia said. — Delon Porcalla