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The harsh reality behind the G8’s African debt relief plans

Crescent International

The unprecedented deal to give 30 poor countries debt-relief, freeing them from the crippling burden of their debts to the West, was presented by the group of seven rich countries approving it as a noble achievement that is certain to eradicate world poverty. Even campaigners for debt-relief for Africa, such as Bob Geldof, who should have known better, hailed it as "a victory for millions". The $55-billion settlement will immediately ‘benefit' 14 African and four Latin American countries that are judged as qualifying for the relief, and will be extended to cover the remaining countries if and when they are deemed to qualify. According to paragraph 2 of the statement of the finance minister approving the deal, to qualify for debt-relief developing countries must "tackle corruption, boost private-sector development" and eliminate "impediments to private investment both domestic and foreign". Governments that want to receive aid, loans and debt-relief must first comply with these "conditionalities".

The package – agreed at a meeting of G7 finance ministers on June 1 – was announced by Gordon Brown, the British chancellor of the exchequer, who described it as a "new deal between the rich and poor of the world". Aid agencies also welcomed it as a "significant step forward" in the run-up to the G8 summit (Russia has been invited) at Gleneagles (Scotland), where the issues of poverty and climate-change will be addressed. But no leader or agency described the deal as enthusiastically and extravagantly as Geldof, who has been campaigning for a long time for Western countries and international aid-agencies to write off Africa's debts to them.

"Tomorrow 280 million Africans will wake up for the first time in their lives without owing you or me a penny from the burden of debt that has crippled them and their countries for so long," he said. "Money we didn't even know we were owed, and never wanted in the first place, and money they could never pay."

Geldof should have known that Africans have never really owed any debt to Western countries, which during the colonial period and since have been robbed of their resources by Western traders and officials, who have also corrupted and continue to corrupt them in the process. Indeed, since the announcement of the debt-relief deal new reports have shown how the EU and the US have been selling, and continue to sell, arms to African countries that are wrecked by civil war, and by doing so have earned more money than they did before. Moreover other current reports show how subsidies to EU farmers have made African farm-produce uncompetitive in world markets. On the very day, for instance, that the Sunday Observer of London published Geldof's praise for the G7 deal, it also published a detailed report on how British arms sales to Africa reached the £1-billion mark. According to this report, analysis of official figures shows that annual weapons sales "almost quadrupled between 1999 and 2004." Export licences granted by the Department of Trade and Industry for military sales last year permitted such sales to Eritrea, Ethiopia, Algeria, Sudan, Zambia, Uganda, Namibia and even Somalia.

Not surprisingly, British MPs and campaigners have called the increase in earnings from sales of weapons to deprived countries "obscene" and "unacceptable" at a time when Britain was leading the campaign for debt-relief. Paul Evis, director of Safeworld, which campaigns for the control of the arms trade, said: "The government is to be congratulated on leading the charge on debt relief, but if it is serious about helping Africa develop as a continent then it should think again about its arms sales policies towards these countries." Andrew George, Liberal Democratic spokesman on development, was even more harsh in condemning the double standards of prime minister Tony Blair's government. "It would seem obscene that at a time when one arm of government is focusing on debt relief, behind the scenes another arm is boosting this unacceptable trade," he said. But Britain is not the only G8 country to be selling arms to the poor and war-ridden African states; other reports accuse the US and members of the EU of selling weapons even to countries that they accuse of violations of human rights.

The conditions set by the G7 for African states to qualify for debt-relief obviously show that the rich countries want to boost their trade sales, including weapons sales; insisting on recipient countries opening up their markets and enlarging foreign-investment opportunities can have no other interpretation. The condition relating to the tackling of corruption cannot be taken seriously. The plain fact is that the G8 group not only tolerates but in effect actually encourages corruption. How else can one explain the fact that not a single member of the group has ratified the UN convention against corruption when 25 other countries have done so? Even Western analysts not only agree with these conclusions but explain that their governments tolerate and, indeed, practise international corruption because they make money out of it. George Monbiot, an analyst at the Guardian, for instance, comments thus: "Genuine corruption is tolerated and even encouraged... Because our own corporations do very nicely out of it. In the UK companies can legally bribe the governments of Africa if they operate though our (profoundly corrupt) tax haven of Jersey."

There is another issue which has not been directly or indirectly discussed in connection with debt-relief and aid to Africa. The G8 countries are forming a united front against "international terrorism" and have discussed the issue at the Gleneagles summit in June, when aid to Africa was also considered. Spying on foreign countries to collect and share intelligence information was another of the matters being discussed. This means that attention will be centred on Muslim countries. The G8 countries are not likely to offer any Muslim country that refuses tocooperate any aid; the Muslim countries are more likely to be punished instead.

Article from

Crescent International Vol. 34, No. 5

Jumada' al-Ula' 24, 14262005-07-01

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