Ugandan President Yoweri Museveni has said canceling poor countries debt is not the solution to poverty.
Museveni was quoted by state-owned newspaper, The New Vision on Thursday as saying he is “grateful that the G8 canceled our debt but this is just a relief but not the solution because if you cancel a poor mans debt without giving him a source of money, he will contract another debt.”
He said poor nations should be given a win-win situation that does not allow many losers and a few winners. – The strategy includes allowing poor countries have access to the markets of the rich countries with a provision of quota and tariff free, Museveni said adding:
– However, free trade should be based on rules that introduce a level playing field while the developed countries should end their protectionism on cotton, sugar, beef and wheat among others.
Kenneth Rogoff, a professor of economics and public policy at Harvard University and former chief economist at the International Monetary Fund, meanwhile writes in an opinion piece in The South China Morning Post that with debt relief for poor countries shaping up as a focal issue at next months G8 summit in Scotland, it is a shame that so few people appreciate what a farce such measures could turn out to be.
Unfortunately, most of the public, egged on by well-meaning rock stars, religious leaders and other popular figures, seem brainwashed into believing that debt relief is a giant step on the road to ending world poverty.
But forgiving poor countries debts without agreeing on a better framework for future aid flows is an empty gesture, Rogoff argues. The fundamental problem with the debt-relief mantra is that it looks backwards rather than forwards.
If the G8 leaders are serious about helping poor countries, finding a reliable way to support grant aid and promote accountability for donors and recipients – not debt relief – is the place to start.
If the political will were there, it would be neither difficult nor expensive to restructure aid agencies like the World Bank and the regional development banks as grants-only agencies.
Kilde: www.worldbank.org
