Blog the Debt

A Losing Game: The West Makes the Rules Africa Must Play By

Canceling the debts of impoverished countries without harmful policy conditions is just one solution to the problem of extreme poverty. In tandem with debt cancellation, making trade equitable and fair for countries that are trying to stabilize their economies must also be done. Africa Focus Bulletin reports:

"We are living in a confusing time in the history of commodity markets. Commodity prices are currently high. Yet producers in Africa and other parts of the developing world do not seem to be benefiting from these high prices. ... The rich industrialised North has set the rules of the game, but instead of holding its producers accountable to those rules, it is distorting markets in their favour. Meanwhile, African producers whose governments have accepted to play by the rules are losing out." -- Dede Amanor-Wilks, ActionAid International

The issue of commodities and development, notes Amanor-Wilks, is far more complicated than just the price levels. And it is further complicated by the new phenomenon of competition for use of agricultural products for fuel. The bottom-line for commodity- dependent countries, including many in Africa, is the lack of control and predictability, as prices fluctuate and commodity markets are increasingly monopolized by large-scale companies.

Without some kind of check on markets and large producers, she notes, the chances for breaking reliance on commodities and entering higher-value sectors of production are very low.

This AfricaFocus Bulletin contains excerpts from a statement at a side-session of the Accra meeting of the United Nations Conference on Trade and Development (UNCTAD). The full report on which this is based is a joint publication by Action Aid and the South Centre. DOWNLOAD IT HERE

Hearing in the House This Wednesday on the Global Food Crisis

Contributing Factors and International Responses to the Global Food Crisis

Wednesday, May 14, 2008, 10:00 a.m., 2128 Rayburn House Office Building

Washington, DC—House Financial Services Committee Chairman Barney Frank today announced the committee will hold a hearing entitled "Contributing Factors and International Responses to the Global Food Crisis" to examine the underlying causes of the current intense pressures on the world’s food system and focus on the immediate and urgent short-term humanitarian challenges to the crisis.  A panel of leading world scholars, experts, and advocates representing a wide range of experience both within the U.S. government and at international organizations such as the UN, the FAO, the World Bank and the IMF will testify on the international food crisis on. 

The hearing will also focus on what kinds of trade policies and other interventions by governments, aid agencies, and international institutions -- including the World Bank, the IMF, and International Fund for Agricultural Development -- would be necessary and most effective in establishing a sustainable and secure food system that meets the basic food needs of all people.

Witness List & Prepared Testimony:

• Dr. Robert Watson, Director, International Assessment of Agricultural Knowledge, Science and Technology for Development (IASSTD)
• Dr. Raj Patel, Political Economist and Visiting Scholar at Center for African Studies, University of Californian, Berkeley
• The Honorable Andrew Natsios, Former Administrator, U.S. Agency for International Development
• Arvind Subramanian, Senior Fellow, the Peterson Institute for International Economics and the Center for Global Development
• The Honorable Eva Clayton, Former Special Adviser to the Director-General, Food and Agriculture Organization at the United Nations

CLICK HERE TO WATCH IT LIVE

A Few Updates: Anti-Corruption in Zambia...and Debt

Starting off the rundown, is Zambia. Most of the questions and critiques on debt cancellation always have corruption somewhere in the argument. Zambia's former president Frederick Chiluba is currently on trial in the country on charges of corruption, accused of stealing at least $60 million from the country's coffers. Last week it was announced that Zambian officials had seized bank statements and assets. What will the recovered money be sued to do? BBC News reports: "Information Minister Mike Mulongoti said the assets would be sold and the money used to upgrade hospitals." READ FULL ARTICLE

Daily Nation: Kenya should follow a policy of debt rejection, not cancellation
Story by OMTATAH OKOITI
Publication Date: 5/10/2008

Planning minister Wycliffe Oparanya’s recent call for debt cancellation calls for more serious analysis than many have accorded it.

Although there are compelling moral arguments to cancel the crippling the developing world’s debt, they don’t amount to much when the countries appeal to pity and not to enforceable law. Further, debt relief will not solve the problem of the poor world’s poverty if it does not also address the root causes. READ FULL ARTICLE

IC Publications: Zimbabwe pays 700 mln dollars to reduce foreign debt
Zimbabwe has paid 700 million dollars (450 million euros) to the African Development Bank (AfDB) to reduce its foreign debt despite the financial woes facing the nation, the bank said Monday.

AfDB said in a statement that Zimbabwe had been in arrears and made the repayment last month despite the deepening foreign exchange shortages facing the embattled southern African nation. READ FULL ARTICLE

Happy Friday: IMF Loses Turkey as a Borrower

By Sameer Dossani | 50 Years Is Enough

Today's news that Turkey is unlikely to renew its standby agreements with the IMF is huge. As many of you will remember, back in 2003, the IMF was receiving more than 60% of its revenue from interest repayments from its four major clients - Brazil, Argentina, Indonesia and Turkey. The first three of those four were unhappy enough with the IMF that they did not renew their loans and even went so far as to repay outstanding debt early, thereby saving themselves considerable interest payments. These moves were enough to precipitate a serious financial crisis for an institution that has had its hand in nearly every major financial crisis around the globe since 1980.

In April, the IMF announced that it would be cutting 15% of its staff and selling $11 billion worth of gold as part of its own "structural adjustment" program; the institution's budget had already decreased by about 20% since 2005. The IMF's financial plan will likely have to be revised yet again - and further budget austerity measures put in place - if they lose their last major client. And if Turkey goes one step further and repays its debt early (like Brazil, Argentina and Indonesia before it) this could signal the end of the end for an institution that once dictated economic policies the world over.

Jesse Jackson urges Haiti debt relief

On his visit to Haiti last week, Rev. Jesse Jackson pleaded to governments and International Financial Institutions to collaborate to cancel Haiti's debt. Joseph Guyler Delva reports from the Reuters:

Jesse Jackson urges Haiti debt relief

Tue Apr 29, 2008 5:49pm EDT, By Joseph Guyler Delva

PORT-AU-PRINCE (Reuters) - U.S. civil rights leader Jesse Jackson called for urgent debt relief for Haiti on Tuesday to ease the burden of a food crisis that sparked violent protests in the impoverished Caribbean nation earlier this month.

Jackson said Haiti owed the World Bank and the Inter-American Development Bank about $1.5 billion, with debt service payments reaching some $70 million a year.

Jubilee On the ONE Blog

Check out the ONE Campaign's blog for our post about Desmond Tutu's op-ed on debt, Lesotho and health care in The Baltimore Sun. Tutu uses some strong language, calling debt "modern-day apartheid."

Desmond Tutu Op-Ed in today's Baltimore Sun

Debt cancellation a victory for the world
By Desmond Tutu | The Baltimore Sun

Last month, the House of Representatives showed leadership in the fight against global poverty by passing the Jubilee Act for Responsible Lending and Expanded Debt Cancellation, which would extend lifesaving debt cancellation to more poor nations around the globe.

Too many of the world's poor children needlessly starve or go without education because too many impoverished nations - even after the laudable debt relief provided to date - are still funneling scarce resources to multilateral banks instead of paying for needs at home.

The world community has found crushing debt to be akin to a modern-day apartheid, and has responded with debt cancellation. Unjust debt leaves developing nations at the behest of the powerful. Shall we let the children of Africa and Asia die of curable disease, prevent them from going to school and limit their opportunities for meaningful work - all to pay off unjust and illegitimate loans made to their forefathers?

When I think of the crisis of international debt, I think of my African neighbor, Lesotho. Many of Lesotho's people cannot afford basic nourishment. The AIDS epidemic has plagued the nation, but needed medicine is out of reach for too many.

Make Mom Proud

This Mother's Day, give the best gift of all: bold action on climate change.

Mother's Day weekend (May 9 - 11) is our chance to expand the climate movement—to invite parents, young people and community groups to come together and send a powerful message that resonates with our political leaders. We all share the same cause—the welfare of future generations—and together, we can make climate action a moral imperative for our elected officials. Join together with members of your community this Mother's Day to to draw or paint a picture of what's most important to you in the face of climate change. You'll send a personal and compelling portrait for climate action to members of Congress.

LEARN MORE ABOUT THE CAMPAIGN AND 1SKY.

Jubilee USA Grassroots Conference Coming in June! Register Today!

Register Today for Jubilee USA's 3rd Annual Grassroots Training & Action Conference! Early Bird registration ends in less than a month!

Keep the Letters to the Editor Coming!

In the past few weeks Jubilee supporters have been sending Letters to the Editor to their local papers. Here are a few of the ones that have been published within the past few weeks. If you haven't sent a Letter to the Editor of your newspaper, you can send one using our pre-written LTE or by writing your own.

May 1
Senate Urged to Back Debt Cancellation
LTE from Nathan Everhart, Erie Times-News

May 4
Debt relief
LTE from Jim Bracke, South Bend Tribune

Urge support of debt-relief bill
LTE from Mary-Nona Hudson, Santa Cruz Sentinel

May 5
Feeding Haiti
Op-Ed By Dr. Joia Mukherjee and Donna Barry, The Boston Globe

May 6
Jubilee Act may save impoverished
LTE By Paul and Adrienne Kalmes, Chicago Daily Herald