Electric lights for a village clinic – a simple but profound change stemming from earlier debt relief – indicate what the future might hold for impoverished African countries in line to see billions in foreign debts written off, writes the World Bank press review Thursday.
Under the African debt cancellation initiative that the Group of Eight richest countries are set to adopt at next months summit in Britain, the 2,5 billion US dollar Senegal owes to the World Bank, the International Monetary Fund and the African Development Bank will be completely scrapped.
As a hint of what this is likely to mean, consider the results for Cherif Lo of the 77,7 dollar million already granted in debt relief in 2003. The nation of 10 million used the savings in such areas as health, energy, road construction and education, including some 4,5 million dollar for projects to improve electricity in rural areas like Cherif.
– Can you imagine, I had to use this gas lamp in the delivery room (fødeafdelingen). God only knows what I was doing in this poorly lit room, said Ndeye Ndiaye, the clinics head nurse in this village 90 kilometres north of the capital, Dakar. Now she sees patients even late at night and no longer has to defer writing prescriptions to the following day simply because the pharmacy has no light.
Finance Minister Abdoulaye Diop promised Senegalese will see more such change thanks to debt cancellation, which he said would free up some 222 million dollar per year if the decision is retroactive to January.
But debt cancellation is only part of the solution for poverty eradication, activists say. – The absence of proper export markets could simply lead to further debt,” said Damien Millet head of the Committee for the Abolition of the Third World Debt in France.
– The solution is therefore to have both debt cancellation and find other source of funding such as donations, Millet said in Paris. To break the cycle of poverty, Millet said industrialized nations should increase their official development assistance from 0,25 percent of donor GNP to 0,75.
The Independent (UK) further writes that in 2001 “thanks to the Jubilee 2000 campaign” Tanzania was given a hefty chunk of debt relief, on the condition that the proceeds were used for education, health and HIV/AIDS. At the same time, the British Government significantly increased aid.
The result: 1.925 primary schools have been built, and 37.261 new teachers have been employed. The number of children at primary school has nearly doubled, and next year, for the first time, every child in Tanzania will receive a primary school education.
An entire generation of children has been given the power of literacy by Africans on the ground and the campaigners in the West who sided with them. So the right aid works. Debt relief works, Hari argues.
Nevertheless: For the deeply impoverished mountain kingdom of Lesotho neither last weeks G8 debt relief deal nor the lifting of barriers to free trade offers much comfort, Finance Minister Timothy Thahane says.
The end in December of the Multifibre Agreement, a global quota agreement that effectively capped production by Asian producers, led to a flurry of textile factory closures as Lesotho, a landlocked country surrounded by South Africa, failed to compete with booming Chinese production.
Thahane also said freeing Lesotho from its debt — 85 percent of which amounts to 600 million US dollar owed to international lenders like the IMF and World Bank, with the remaining 15 percent bilateral debt mainly to France and South Africa — would allow it to spend more on reducing poverty. But Lesotho was not one of the 18 heavily indebted poor countries named last week by the G8 for debt forgiveness.
Thahane said he expected the country to be included in future deals, but said one of the reasons Lesotho was not classed as a HIPC country was that it had never defaulted on its debt. – We have never defaulted on our debt. It is important that those who have paid their debts well, who run their mega-finances well, should be rewarded with debt forgiveness.
Kilde: www.worldbank.org
