Monday, April 9, 2012

Financial Times: UK seeks repayment of Malvinas War era loan

The United Kingdom is chasing 45 million pounds of debt allegedly owed by the Argentinean government that was lent to the country’s military junta in 1979 and used, in part, to buy weapons and armories which were later used at the Malvinas war.

According to the article, UK Export Finance, an arm of Vince Cable’s business department, inherited the debt after Argentina supposedlydefaulted on loans to British exporters, which were underwritten by the UK government at the time.

The goods supplied by those exporters, said the paper, included two Lynx helicopters and two Type 42 warships, which were used in the Malvinas War. “One of the helicopters was among the first to arrive on the islands after the initial Argentinean landing 30 years ago last week,” the Financial Times reported.

A spokesperson for the business department told the Financial Times “the government has no plans to offer debt forgiveness.”

“ If Argentina requires further debt relief to that already agreed, it should approach the Paris Club [the intergovernmental body that agrees debt relief], which is responsible for addressing these matters on behalf of all official creditors on a multilateral basis.”

Nick Dearden, director of the Jubilee Debt Campaign told the paper that “lending the military Junta money to buy British weapons was illegitimate and odious. The Liberal Democrats must stick to their pledge to rule invalid loans recklessly given to dictators.”

“The anniversary of the Falklands war (Malvinas) should force the government to question the way it does business. The government must implement Liberal Democrat policy and stop subsidizing war through the backing of loans to other governments to buy weapons,” he added.

Lord Owen is said to have signed off on the decision when he was Labour foreign secretary in 1979. At the time, he said “important questions of principle” were raised given the “size of potential arms sales to a regime whose human rights record is worse than Chile [which was under an arms embargo from the UK at the time]” and could “come close to a confrontation with us over the Falklands (Malvinas)”.

He added that there was “no Foreign Office objection to the sale of the Lynx helicopters” even though he acknowledged “these items would be relevant in any threat to the Falkland (Mlavinas) Islands,” reported the paper.