Vulture fund drains Congo’s life blood

The Guardian newspaper in the UK reports that the DRC currently
is struggling with fine payments of $ 20,000 a week in connection with a debt payable to the New York vulture fund FG Hemisphere. The investment company is seeking a return on its purchase of $ 44.1 million of debt that was incurred by former dictator Mobutu Sese Seko from Tito’s Jugoslavia in the 1980s. Including interest, compound interest and penalties, that debt now amounts to around $ 100 million. Because the DRC’s government failed to provide sufficiently detailed information about the country’s assets, a Washington court in March ordered the DRC to pay a penalty that could eventually rise to as much as $ 80,000 a week.

Erlassjahr.de, a German network that is campaigning for debt relief, is familiar with FG Hemisphere, stating that the company has a history of buying the sovereign debt of extremely poor countries and then going to court to enforce large payments. To prevent this practice, non-governmental organisations have called upon the US Congress to pass a law outlawing vulture-fund activities. Two members of Congress recently introduced bills aimed at changing the law accordingly. (cir)