The Group of 8 has agreed to $40 billion in debt relief
to 18 of the world's poorest countries, including Burkina Faso
. This move will allow the affected countries to keep some $1.5 Billion annually; money that formerly went to debt servicing. The debts cancelled include those to the World band, the African Development Bank and the International Monetary Fund. For those countries struggling to make debt payments, in addition to meeting the needs of their people, this is welcome relief.At the same time
, it does not include all poor countries (Nigeria and Indonesia, amongst others, did not make the cut) and much of the funds are coming out of current aid budgets:
Moreover, it does not include an even more ambitious British proposal, viewed negatively by Washington, to double about $50 billion in aid given annually by rich countries.
Which means, that while this plan is definitely a good step, it may simply signal the shifting around of aid funds. Archbishop Desmond Tutu
, amongst calls for strict monitoring of the deal, reminded the world of the necessity for further aid:
He also urged rich nations to boost aid and revise trade rules under which wealthy countries received farming subsidies, enabling them to produce cheaper goods that were being dumped in Africa and pricing African produce out of world markets.
"I hope that the heads of these different countries will be sensitive and say we are on the same side, we want to eradicate poverty, we want to ensure that trade conditions are equitable and we want to increase aid," he said.
Archbishop Tutu brings up an important point: unfair trade practices
, protective tarrifs for American and French agriculture (amongst others), present grave obstacles for the development of poor nations. The reduction of those barriers must be central to any serious poverty-reduction effort, alongside and in addition to increased aid.
And a mea culpa from me: many thanks are due for the efforts of celebrities like Bono and the ONE.org
Aid activists who have played crucial roles in marshalling popular support for debt forgiveness cheered yesterday's announcement while voicing determination to press for more. A group of celebrities, led by rock musicians Bob Geldof and Bono, is planning free concerts and rallies in the hope of spurring the G-8 to adopt the aid-doubling plan.
ONE.org is calling for 1% of the US government budget to be spent on foreign aid and poverty reduction, and I most heartily join them.