In March 2009, EJN and AFRODAD co-hosted a conference on Fair and Transparent Arbitration Mechanisms on Illegitimate and Odious Debt. The objective was to examine contentious issues around the African debt crisis, among them debates around debt arbitration.

International representatives attended the conference, and the presence of participants from diverse backgrounds – ranging from senators and parliamentarians to lawyers and church officials – all indicated that the burden of campaigning for debt arbitration has shifted to the public sector.

Odious debts are those contracted against the interests of the population of a state, without their consent, and with the full awareness of the creditor. Here the lenders will have acted improperly by making odious and harmful loans that by national and international law should not be paid.

Debt arbitration is needed to deal fairly and transparently with debt issues, especially illegitimate debt issues, where lenders have made developing countries take loans they did not need, usually under inappropriate conditions.

Others would argue that the most developed countries owe developing countries for the effects of imperialism, slavery, environmental damage and so on, since they were the primary beneficiaries of these actions.

Suggestions were made about forming a United Nations (UN) commission on Debt based on the same model as UNICTRAL. The call to action was to encourage the UN to play a bigger role in dealing with these serious issues. It was argued that the UN should formulate an Arbitration Mechanism to give developing nations a platform to voice their concerns.

Martha Nanjobe said, “A fair and just resolution of the debt crisis requires an open, transparent and accountable system for citizens and tax payers.”

However, Charles Abrahams cautioned participants, stating that a consensus between the debtor and the creditor was needed before such a mechanism can be established.

‘‘You can only have arbitration by consent. There is no point in having it if there is no consensus. Both parties must agree, elect a forum and agree on composition of arbitration board members, decide on rules to be applicable and how the arbitration will play out,'' Abrahams said. Senator Gutu, from Zimbabwe, called for “the coming together of less developed countries since individually they lack the political and financial capability to seek the cancellation of odious debts.”

It was acknowledged that progress has been made on these complex issues, but participants agreed more awareness and education is still needed.