The campaign for Third World debt relief is counter-productive

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The Independent Online
AS AN OBJECTIVE, relieving the poorest nations of their debt burden by the millennium is laudable. Such an outcome would indeed reduce misery and malnutrition for hundreds of millions of people otherwise living without hope of a decent life. What I question is not the aim of the Jubilee 2000 campaign launched at the Birmingham economic summit by a coalition of 70 aid agencies, trades unions and churches, but the means. Thus far, the campaign appears to be badly conceived. As political action it is likely to be ineffectual - as it was at Birmingham - if not counter-productive.

Politics is language as well as action. The first clue that something was wrong with the campaign was the statement made by a spokesperson for Oxfam last week. She said: "Failure to remove the debt burden in Africa is a violation of child rights." Well, I suppose it is something to have crammed into a 14-word sentence five words with emotional punch - failure, burden, violation, child, rights.

But implicit in the comment is a paradox: that the lenders rather than the borrowers are at fault. There may be something to be said for this argument, but that is not the point. You cannot conduct an effective political campaign on the basis of a paradox. A paradox generates doubts in listeners' minds.

More striking still is the assertion that child rights are being violated. The spokesperson described the actions of rich countries in terms of the most despicable act anyone can think of, short of murder. Remember that when people hear of a violation of children's rights, often it is in the context of paedophilia. And on what is this monstrous association of ideas based? On the truism that every dollar spent on debt repayments could instead have been used for primary education or public health facilities.

In a final, brilliant flourish the Oxfam executive added: "The primary responsibility for these ongoing violations rests with countries such as Germany, Japan and Italy ... who have sought collectively to delay and diminish the debt relief." Note the repeated use of the word "violations". I suppose it is pure coincidence that these are the three countries against whom the Second World War was fought.

A second sign that the campaign is misconceived was on display at the Jubilee 2000 meeting in Birmingham at which Clare Short, the sympathetic Secretary of State for International Development, was the main speaker. Unfortunately, as was plain from Paul Vallely's eloquent report in yesterday's paper, the audience received a mixed message. Every time Ed Mayo, Jubilee 2000's chairman, made a point, Clare Short rose to her feet to rebut him. This is bad politics for the campaign.

Instead of paradox, monstrous accusation and mixed messages, a successful campaign demands a clear, unsurprising, persuasive objective founded upon unambiguous facts. "Cancel the debts of poor countries" would do - except that, in fact, debt cancellation has been going on for many years.

As long ago as 1988, the Paris Club, the group that represents the main lenders, agreed to cut the debt burdens of the most severely affected countries by 33 per cent. Three years later this was raised to 50 per cent, then to 67 per cent in 1994. In total, the Paris Club has reduced or rescheduled $300bn worth of debt over the past two decades. Oxfam does not need to resort to violent language because it does not have a revolutionary idea to try to get across; the principle of debt cancellation has long been accepted.

Try a second formulation: "Rich countries must stop impoverishing poor countries." But this won't do either. It is not true that highly indebted poor countries as a group, because of their need to repay loans, are losing more resources by way of interest and debt payments than they are gaining by other routes. Quite the reverse. The figures collected by the World Bank suggest that this group of mainly African countries situated south of the Sahara desert has been benefiting from net inflows equivalent to about 7 per cent of their national output for the past 15 years.

How about: "Make special arrangements for the debts of the poorest countries." Indeed, but this is precisely what was agreed by the World Bank, the International Monetary Fund and the leading creditor countries in 1996. All creditors agreed to reduce the debt burden to sustainable levels - 20 to 25 per cent of export earnings. But to be assessed for relief a country has to stick to a rigorous programme of IMF economic reforms for three years. And even after that the probation period is not over. The debtor country still has to undergo another three years of the IMF programme before actually benefiting from debt reduction.

Now Jubilee 2000 quite reasonably says this approach is insufficient. It still leaves countries repaying too much debt and the process of amelioration is taking too long. Stop there. That is precisely what the discussions between creditor nations, highly indebted poor countries and the World Bank and IMF are about.

There must be conditions, otherwise the foreign exchange saved by debt relief might end up in the Swiss bank accounts of dictators and their families, or be spent on arms purchases or on prestigious, white-elephant projects. The question is how generous to make the conditions. This, I contend, is the stuff of intricate negotiations.

If you make a campaign out of it, then you are driven to use extreme language, or twist the facts far from the truth. Then the very people you want to influence, the ministers and officials of the rich democracies, stop listening to you. That is what happened in Birmingham. Debt relief wasn't even mentioned in the official communique, only in a statement by the British Prime Minister in his role as host.