DEVELOPMENT BULLETIN-AFRICA: Unchain Africa, Debt Campaigners Say

By IPS Correspondents Reprint | | Print |

Dipankar De Sarkar

LONDON, May 16 1998 (IPS) - Imagine an Africa freed of its debt bondage.

“In Mozambique, it would mean that the 20 percent of gross domestic product that it pays on repaying its debt every year could be ploughed back into health and education,” says Adrian Lovett, Deputy Director of the Jubilee 2000 Coalition, which campaigns on debt issues.

At present, the southern African country is able to spend only eight percent of GDP on education and three percent on health.

And then imagine if the international donor community had displayed even a fraction of the political will and alacrity to deal with African debt as they had done in helping east Asian nations tackle their current financial crisis.

According to the United Nations Development Programme (UNDP), if the external debt of the 20 poorest countries of the world, many of them African, was written off today, it could save the lives of 21 million children before the year 2000.

Read the other way around, this figure means uncancelled debt could be responsible for the deaths of 130,000 children a week till 2000.

“If debt is written off, it could free up the potential of African children, and save lives through low cost health interventions,” says Oxfam’s Ian Bray. “It is the children’s right.”

“The benefits of debt relief could be channelled to support education, health care, credit and pro-poor rural development,” says UNDP.

Their comments underscored the message from a Jubilee 2000 report this month that showed Africa paid out 1.31 dollars in debt service for every one dollar it received in aid grants in 1996.

“And Africa is the least well placed of all developing regions to sustain such a transfer, with real GDP per capita at less than half that of all developing countries and less than one-tenth of the industrialised countries,” the report, titled Chains Around Africa, said.

What is more, says the report, the gap between grants and debt service is increasing. The 1.31 dollars figure is the highest since 1989.

The figures calculated by Jubilee 2000 are shocking: the total debt owed by Africa in 1996 was 227.2 billion dollars — 379 dollars for every man, woman and child in the continent. Africa shoulders 11 percent of the developing world’s debt, with only five percent of the developing world’s income.

In 1997, the International Monetary Fund (IMF) expects to have put in 500 million dollars and taken out 1.1 billion dollars. This does not include significant interest charges. It amounts to “a net gain to the IMF from the world’s poorest continent of at least 600 million dollars in a single year,” the report says.