End of Mission Statement of the Independent Expert on foreign debt and human rights - Official mission to the Democratic Republic of Congo, 25 July- 5 August 2011

Kinshasa, 5 August 2011

Members of the media,
Ladies and gentlemen,

I am pleased to be with you this morning, here in Kinshasa, to share the preliminary findings of my official fact-finding visit to the Democratic Republic of Congo (DRC). The visit, which began on 25 July and ends today, has provided me with very useful insights and information.

I would like to first express my profound thanks to the Government for inviting me to undertake this mission. The invitation is indicative of the Government’s commitment to exploring ways of improving the well-being of the people of this country and implementing its international human rights obligations. It also demonstrates the Government’s clear understanding of the relevance of the mandate of the Independent Expert on foreign debt and human rights, as well as its appreciation of the contribution the mandate can make to assist the Government fulfil its human rights obligations, particularly those relating to economic, social and cultural rights.

The main purpose of my visit was to assess, in the spirit of cooperation and dialogue, the impact of the country’s external debt on the capacity of the Government to realize all human rights, especially economic, social and cultural rights and to make progress towards the Millennium Development Goals. My visit also aimed to evaluate the impact of the global financial crisis on the Government’s capacity to effectively deliver human rights-related basic social services to its people. Finally, I hoped to gain a better understanding of the effect of “vulture fund” litigation on the country’s gains from debt relief and its ability to comply with its human rights obligations.

During the course of my visit, I have had informative discussions with the Vice-Prime Minister and Minister of social affairs, several cabinet ministers, and senior government officials in Kinshasa. I have also met with the country’s bilateral and multilateral development partners, including United Nations agencies, the World Bank, the African Development Bank and some foreign embassies. From 2 to 4 August, I travelled to Lubumbashi in Katanga, where I had very informative and constructive discussions with the Governor of the province and with members of civil society organisations based in that city. I also had insightful round-table meetings with civil society organizations in both Kinshasa and Lubumbashi. I wish to thank all of those that gave of their time and shared their respective perspectives.

I regret, however, that I was unable to meet with a number of key stakeholders, particularly the ministries of planning and education, members of the Parliamentary committee responsible for economic affairs and some bilateral partners of the DRC. In order for an independent expert in my position to make a full assessment of the situation, it is important to obtain information from all relevant stakeholders.

The findings of this visit will be presented in a comprehensive report that I will submit to the United Nations Human Rights Council in June next year. Preparation of this report – which will become a public document after submission to the Council – requires that all information (including that contained in official and non-official documents) either provided or to be provided be carefully analysed to feed into this report, where necessary. For now, I would like to share with you the preliminary findings of my mission.

Ladies and gentlemen,

By ratifying several core international human rights treaties, including the United Nations International Covenant on Economic, Social and Cultural Rights, and the African Charter on Human and Peoples’ Rights, the DRC has legally committed itself to realizing the human rights of all people within its territory or jurisdiction. It is important to underscore this obligation because it provides a clear and legally binding framework for the rights-holders – citizens and other people living in the country - to hold the Government accountable. It should also be stressed that the ICESCR imposes an obligation on the Government to use the maximum of its available resources for the realization of the human rights elaborated in the Covenant.

I wish to commend the Government for implementing certain policies that have led to a budget surplus this year, and also to the attainment of the completion point under the Highly Indebted Poor Countries Initiative (HIPC) last year. These achievements carry the potential for positive change in the delivery of human rights-related basic social services, such as water, electricity, education, health etc.

I recognize that the DRC is a post-conflict country where the security situation in parts of the country remains fragile. The above achievements show that progress is being made. However, it is equally important to recognize that sustainable development will only be possible if concerted efforts are made to address the several challenges that remain, including corruption, transparency in the management of public resources and ensuring that citizens fully enjoy – on an equitable basis – the benefits of foreign investment.

However minimal the gains from debt relief under the HIPC Initiative might be, it is the responsibility of the Government to ensure that they are utilised in effective manner, for the benefit of the people, especially the poor and other vulnerable groups. In line with the purposes of multilateral debt relief, the fiscal space provided by debt relief should be directed to ensuring the realization of the rights to safe water, health, education, housing, food etc. of the population. This fiscal space must be utilised in a transparent and accountable manner to ensure that the benefits of debt relief and economic progress are shared by all on an equitable basis. In particular, the public should be informed about the extent of the debt relief gains and what the Government’s plans for the utilization of that expanded fiscal space are.

I understand that a portion of the country’s remaining debt burden is attributable to foreign export credits, particularly for infrastructure projects. Information provided by the Government remains inadequate in this regard. In order to avoid situations that have contributed to unsustainable debt in the past, and indeed to gain a clear picture of the country’s debt burden in order to establish an effective public debt management system and to avoid a build up of unsustainable debt in the future, it is important to gain a full picture of the country’s debt burden. Such a picture may emerge from a transparent and participatory public debt audit. Such an audit should also take into consideration the odious debt doctrine and serve as a basis for new discussions with the historical creditors.

The realisation of human rights through effective use of public resources also requires more robust action to combat corruption. In this regard, I wish to commend the Government on its Zero Tolerance Policy, but this should not remain a mere slogan. It should be translated into action, so that the management of public resources is made more transparent and that those with responsibility for managing public resources are accountable to those on whose behalf they discharge this responsibility – the people of this country. This is the only way basic service delivery to the people throughout the DRC will be ensured.

The fight against corruption and the promotion of transparency and accountability in the management of public resources should also apply to official development assistance and foreign investment. In this regard, the lack of transparency with which some important investment contracts, particularly those relating to the extractive industries sector, have allegedly been signed remains a source of great concern. I therefore urge the Government of the DRC and, where applicable, its partners to publish all contracts with multinational companies that exploit the natural resources of the country. Exploitation of natural resources can only be legitimate if it is done for the benefit of the people, as indicated in Articles 56 and 57 of the Constitution.

I note that efforts towards formalisation of the economy and broadening of the tax base in the country are under consideration. I wish to commend the Government for adopting measures to grow the economy. I have been informed that a value added tax will be established early next year. In order to ensure debt sustainability and to get out of dependency on external aid, effective domestic resource mobilisation is critical. However, this can only be assured in circumstances where the public service is better managed, corruption is brought under control, and salaries of employees of the public and private sectors are regularly paid. Measures to address the country’s economic challenges should also take into account the specific vulnerabilities of the poorest. Consideration should also be given to encouraging and supporting local entrepreneurship. Further, the Government should endeavour to enhance the capacity of the provincial administrations to provide basic services to their populations by making budgetary disbursements to the provinces that are in line with the relevant Constitutional requirements.

I have been informed that the Government, together with its development partners, is currently preparing a new Poverty Reduction Strategy Paper (PRSP). I want to emphasize that the PRSP can effectively alleviate poverty in the country only if it takes into account the human rights obligation of the State. I therefore call on the Government and its partners to adopt a rights-based approach to poverty alleviation.

With regards to the security situation in the eastern part of the country, I would like to urge the Government to continue its efforts towards full pacification of its territory. A more secure environment would contribute to better domestic revenue mobilisation and to the creation of an environment that is more conducive to the rule of law and respect for human rights.

Before I draw my remarks to a close, allow me, ladies and gentlemen, to say a few words on a matter that is a key concern for my mandate – the issue of “vulture fund” litigation and its impact on the realization of human rights. Last year, I devoted my report to the Human Rights Council on this issue, but it continues to be a source of concern for many countries including the DRC. Vulture funds (or “distressed debt funds”) are private commercial entities that purchase the debts of poor countries on secondary markets at a significant discount. They then institute legal proceedings against these countries in an attempt to recover these debts, plus interests, penalties and legal costs. The amounts they claim against poor countries are exorbitant – typically between 3 to 20 times the amount that they paid for the debt. Their actions sometimes results in confiscation of countries’ properties and assets. The DRC has been facing vulture fund litigation in several parts of the world: in Australia, Hong Kong, the USA and South Africa. It is a serious concern to me, as these legal suits may comprise the already meagre gains from debt relief programmes. I and many others, find the actions or these vulture funds are reprehensible. I therefore stand ready to assist the Government in its fight against these unscrupulous creditors. I also reiterate my call upon all States to limit the ability of vulture funds to recover extortionate amounts from poor countries. As I have previously mentioned, it is illogical to grant debt relief while at the time allowing vulture funds to dilute the gains from debt relief through litigation.

Ladies and gentlemen,

These are some of the main issues that I have identified in the course of my visit. I am well aware that the debt relief provided to the DRC last year is no panacea or long term solution to the country’s problems. It nevertheless represents an important opportunity for the Government to make progress in the provision of basic social services to its people. I call upon the Government to ensure more transparent and participatory public financial management.

As mentioned earlier, these are my preliminary findings. I will develop them further in my report Human Rights Council.

Thanks you for your kind attention. I now welcome your questions, if any.