A/HRC/20/23 The shared responsibility of creditors and debtors 23. Creditors and debtors share responsibility for preventing and resolving unsustainable debt situations.7 For creditors, this includes the obligation to perform due diligence on the creditworthiness and ability to repay of the borrower as well as the duty to refrain from providing a loan in circumstances where the lender is aware that the funds will be used for non-public purposes or for a non-viable project. For debtor States, this entails an obligation to contract loans and use the loan funds in ways that serve the public interest and repay the debt in a timely fashion. 24. The mutual accountability of creditors and debtors for their decisions is an important precondition for the establishment of an equitable global financial system. Ensuring an independent process of national development 25. Every State has the sovereign and inalienable right to implement a process of national development independently and free from pressure, influence or interference from external actors, including other States and international financial institutions. An independent process of national development means that the legitimate leaders of the people have effective control over the direction of the country’s economic development. This process should be transparent, participatory, accountable and responsive. 26. The right to self-determination requires the legitimate authorities of a State to have independent control over the direction of a State’s economy (i.e. where it is going) and effective involvement in economic planning (i.e. how to get there). 27. The principle of permanent sovereignty over natural resources implies the right of all States to possess, use, or otherwise dispose of their natural wealth and resources as they deem proper, free from pressure, influence or interference from external actors, including other States and international financial institutions. State sovereignty must be exercised in full compliance with and respect for human rights, paying particular attention to the most vulnerable groups in society. Transparency, participation and accountability 28. Transparency, participation and accountability are core values that should be observed in the lending and borrowing decisions by States, international financial institutions and other actors as appropriate, the negotiation and execution of loan agreements or other debt instruments, the utilization of loan funds, making of debt repayments, the renegotiation and restructuring of external debts, and implementation of debt relief when appropriate. 29. Transparency requires the full disclosure of all relevant information regarding loan agreements, debt repayments, debt management, outcomes of public debt audits and other related matters. 30. Participation requires effective and meaningful input from all stakeholders (including project beneficiaries) in loan policy and resource utilization decisions. 31. Accountability requires remedial measures that ensure decision-makers are answerable, if warranted, for their actions regarding external debt agreements or arrangement, as well as external debt policies and strategies. 7 14 Report of the International Conference on Financing for Development, Monterrey, Mexico, 18-22 March 2002 (United Nations publication, Sales No. E.02.II.A.7), chap. I, resolution 1, annex, para. 47.