Africa reinforces debt relief case
|
|
African countries granted debt relief by rich nations under the International Monetary Fund’s $40bn highly indebted poor countries programme (HIPC) are reaping the benefits in higher spending on education and health, campaigners claim today. In a report which calls for a substantial extension of relief, Jubilee Research finds that in a sample of 10 HIPC countries, including Cameroon, Malawi and Rwanda, education spend ing has risen from $929m in 1998 - less than they were spending then on servicing their debts - to $1.3bn in 2002, almost double the amount now spent on debt service.* Health increased from $466m, or 1.6% of GDP in 1998, to $796m, or 2.8% of GDP, this year. “Critics of debt relief tend to argue that it simply supports corrupt regimes or gives governments more money to spend on defence,” said Ann Pettifor, one of the co-founders of the Jubilee 2000 campaign. “Our research shows that relief is leading to greater investment in health and education, not the military.” The report backs African leaders’ calls for a new partnership for Africa’s development (Nepad). Countries would commit to principles of good governance in exchange for much higher levels of debt relief, with extra funds to be spent on targeted, costed programmes for poverty reduction. Tony Blair has described Nepad as the “best chance in a generation to do development differently”, but it would not be cheap, - the authors believe it could cost up to £100bn. With few signs of commitment to Nepad from northern governments, HIPC relief often taking years, last week saw evidence that some of the poorest nations could lose patience, and take unilateral action. Africa’s biggest debtor, Nigeria, not a HIPC country, announced that it had not been making servicing payments on its Paris Club debts since June. The Nigerian high commission in London played down the move, but it followed a warning from high-profile economist Jeffrey Sachs, who advises UN secretary general Kofi Annan and the Nigerian government, that African countries might refuse to continue paying. “If the countries pay the debt, they can’t meet their developmental needs. It’s not irresponsible for African leaders to put the survival of their people first.” Nigeria, which is in negotiations with its creditors, has to walk a fine line, persuading lender countries that its motives for suspending repayments are humanitarian. Evidence that that is exactly what has happened in HIPC countries so far, can only increase the moral pressure on richer nations to help Africa come up with a more permanent solution to its problems, before other cash-starved governments follow Nigeria’s lead. * Relief Works, Romilly Greenhill and Sasha Blackmore at the New Economics Foundation |