Debt Relief – Solid Victory For Wolfowitz.
In his first major test as the new president of the World Bank, Paul Wolfowitz has achieved something everyone can praise: He pressured the worlds wealthiest nations into forgiving 40 billion US dollar (240 milliarder DKR) owed to the bank and the International Monetary Fund (IMF) by the worlds poorest nations, most of them in Africa, writes The Star Tribune (United States) in Mondays editorial.
Initially, the debt relief will apply to the 18 poorest nations, freeing up billions of dollars they can use for education, infrastructure development and coping with the AIDS epidemic rather than payments on debt principal and interest to the international bodies.
However, an additional 20 countries could be added to the program if they meet benchmarks for good governance. That would bring the total debt relief to a potential 57 billion dollar.
Although the debt relief program was agreed to by leaders of the G8 nations in their July summit, it almost died. Nordic countries, the Netherlands and other small European nations dragged their feet, worrying that the wealthy G8 countries would simply use their existing appropriations to the World Bank and IMF to finance the debt program.
During intense negotiations last weekend, Wolfowitz sided with the Nordic worriers. He twisted many G8 arms, including those of former colleagues in the Bush administration, to pledge that they would make contributions to finance the debt relief over and above their regular contributions to the international bodies.
That means the two agencies will have much more funding available to continue making investments in the worlds poorest nations.
Wolfowitz did not pause for applause when the pact was achieved, the daily writes. He said, instead, that attention must turn immediately to winning agreement on implementing the Doha trade round in advance of the World Trade Organization meeting this December in Hong Kong.
Progress toward the Doha goals has been essentially nil, for the obvious reasons: Nations like the United States and members of the European Union face political revolt if they actually follow through on reducing agricultural subsidies and market protections. But unless they do, they are committing the Third World to a perpetual state of poverty.
No one ever doubted that Wolfowitz was smart; he is downright brilliant, when he does not allow ideology to cloud his judgment, the daily suggests. With his dedication and smarts and vigor, it is entirely possible that, come December, actual agreements will be tabled in Hong Kong for implementing the goals agreed to in Doha.
Everyone who cares that the poorest of the poor nations get a chance to compete fairly in the world markets should pray that Wolfowitz comes through on trade as he has on debt.
Kilde: www.worldbank.org
