'Vulture' Fund wins $15.5million from Zambia: The G8 must prevent this happening again
On Tuesday 24th April, 'Vulture Fund' Donegal International were denied by British courts from claiming $55 million from Zambia. This is a partial victory for Zambia but highlights that the rules must now change to stop this happening again. Donegal were not breaking the law in suing Zambia but the moral case is clear - Debt cancellation fought for by Jubilee and MAKEPOVERTYHISTORY in 2005 must not be used as an opportunity for private creditors to prey on funds that are vital for poor countries' development.

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The UK government must work with the other G8 countries to support the establishment of a just and comprehensive system for dealing with poor country debt. Currently, whenever countries receive debt relief through the HIPC initiative or the Paris and London Clubs, they are left vulnerable to exploitative lawsuits from Vulture funds like Donegal.

Initially what is needed are preventative measures:

- Rules to prevent individual creditors targeting countries that have already qualified for individual debt relief schemes;

- Vigorous action to prosecute any corrupt activity by such creditors;

- and the establishment of an international fund for legal assistance for countries that are targeted.

But most of all what is needed is a just and comprehensive debt relief system, which takes account of the origins of debts as well as their current impact, and which places the same moral and legal obligations on companies as it does on governments.

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