Leading article: G8 fails victims of Third World debt

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The Independent Online
"CANCEL Third World debt" is an appealing slogan, but not a desirable policy. Half the debt owed to the British government by developing countries is owed by Nigeria, and what the Nigerian regime needs is a sharp lesson in human rights and democracy rather than the financial leeway to invest in more arms and repression.

However, the Jubilee 2000 campaign, which lobbied the rich countries' summit in Birmingham, was not asking for anything so simplistic. The campaign, which takes its name from the biblical idea of the "jubilee" every 50 years when debts were forgiven, proposed modest and practical reforms to the debt-relief programme already agreed by the rich nations. As it stands, the programme requires that poor countries follow an IMF-approved "structural adjustment programme" for six years in order to qualify; if they drop out half-way through they have to start again at the beginning. Jubilee 2000 asked for the rule to be eased (except for corrupt, oppressive or high arms-spending regimes), and to be dropped in cases like Rwanda and Liberia, which have just emerged from bloody conflict. It asked for the definition of "heavily indebted" to be widened: at present, poor countries have to be spending a quarter of their export earnings on paying debt interest to qualify. And it asked for more relief to be given to those countries which do qualify. Mozambique, one of the few countries granted relief, has so far been forgiven just 4 per cent of its debts, worth 27p per Mozambican per year - in a country which spends more on debt repayments than it does on health and education combined, and where child mortality and illiteracy are soaring.

The response from two of the G8, Germany and Japan, was particularly disappointing. The Germans in effect accused Tony Blair of hypocrisy, for lecturing them about debt relief when Britain has one of the worst records for writing off debts (partly because we have fewer to write off). The Japanese muttered about "honour" and the danger of "moral hazard" if obligations were not fulfilled. As a result, the summit was faced with a different moral hazard, that of inaction in the face of needless suffering.

Clare Short, in her sympathetic appearance on Saturday "on the side" of the demonstrators, hinted that something would be achieved at the summit at least for poor countries emerging from wars. But when we study the communique, what do we find? Mere words. The G8 supports "the speedy and determined extension of debt relief to more countries", but only within the terms of existing policy. And what about the so-called "post-conflict countries"? The G8 will "consider" ways to respond to their needs. If that represents, as the Prime Minister claimed yesterday, "a significant step forward", then we are living in an ethical Lilliput, in need of some seven-league boots.