The discussion on whether Bangladesh must repay odious debts from the Awami League regime is intensifying. Debts accumulating under systemic corruption have raised questions about their legitimacy. Historically, the concept of odious debt protects future governments from burdens incurred without consent or benefit. Lessons from Ecuador’s successful repudiation of illegitimate debts offer a path forward for Bangladesh, framing the debate on financial responsibility toward future economic health.
The debate over whether Bangladesh should repay debts deemed ‘odious’ from the Awami League regime is gaining momentum. With annual siphoning averaging $16 billion during the party’s 15-year rule, critics question the legitimacy of loans granted to such a corrupt government. Historical examples, such as the U.S. stance on Cuba and Puerto Rico, underline the principle that debts incurred without popular consent for ulterior motives may not bind successor regimes.
The concept of odious debt, popularized by legal theorist Alexander Nahum Sack in 1927, defines debts incurred by despotic regimes not in the nation’s interest as personal liabilities of the ruler, not to be inherited by the state. Currently, with Bangladesh’s external debt reaching $104.36 billion by September 2024, residents grapple with the repercussions of loans linked to systemic corruption that took place under the previous regime.
Economists like Anis Chowdhury argue these debts merit the ‘odious’ label, noting the complicity of international lenders who propped up the Awami League despite known abuses. They argue for a public audit of loans to classify potentially illegitimate debts that should not impact the nation’s future financial health. Historical precedents like Ecuador’s repudiation of similar debts showcase strategies for handling borrows accumulated under corrupt administrations.
Ecuador’s President Rafael Correa halted repayments of sovereign debt, leading to a dramatic reduction in service costs for social programs that benefited citizens. The success of this approach serves as a model for Bangladesh, suggesting a need for government entities to reassess obligations inherited from the previous regime. Suggested approaches include an independent commission to review loans and align repayment responsibilities with current governance and ethical standards.
Bangladesh has faced odious debt before, as seen during the liberation period when the government resisted assuming liabilities for debts incurred by the former Pakistani regime, advocating for reductions based on damages incurred. This historical context reinforces the argument that the current government shouldn’t inherit debts lacking popular validation or incurred for means contrary to the nation’s welfare.
The discourse around Bangladesh’s repayment of odious debts highlights the complexities of inherited financial obligations tied to corruption. Historical examples demonstrate potential strategies for addressing these debts, emphasizing the need for a thorough audit and a clear argument against the legitimacy of such obligations. Stakeholders advocate for measures that prioritize citizen welfare and socioeconomic development, rather than carrying the financial burdens left by past regimes.
Original Source: www.tbsnews.net
