wfn.org | Economists can provide stimulus to relieve African debt

[Theo Coggin]

Tel: +2711-487-1994
e-mail: coggin@sn.apc.org

The Anglican Archbishop of Cape Town, the Most Revd Njongonkulu
Ndungane, says that African economists are well placed to seize unique
opportunities to contribute to solutions for the continent.  

Speaking at the African launch in Accra, Ghana, of Jubilee 2000, a
campaign sparked by Pope John Paul II to repudiate the debts of
developing countries, Archbishop Ndungane indicated that there were many
experienced scenario planners and economists on the continent. They
could provide “an exciting stimulus” to ensure the debt of countries is
relieved, thus releasing vast amounts of money for development.  

This, in turn, would generate new wealth, the Archbishop said. 

He pleaded for new thinking   -  “thinking that has in mind the
development of people and their own, local economies, for the benefit of
the largest number of people”.  

The Archbishop also said there were debts in Africa that should be
declared odious.

He noted that many frontline states had suffered as a result of the
policy of destabilisation in southern African in the 1980s. Countries
such as Angola, Lesotho, Moçambique,  Malawi, Zimbabwe, Zambia and
Tanzania were among those that had experienced such hardship. 
  
“Together with others like Namibia, Swaziland and Botswana,  they found
themselves in the midst of the struggle between different world forces,
with southern Africa as the battleground - forces backing on the one
hand the status quo  in South Africa, and on the other, the liberation
movements. Their debts incurred during this time should also be declared
odious and written off. This would lead to a combined saving for them of
almost US$38 billion”, he said. 

He pointed out that South Africa had already written off the debt of
Namibia.  Other countries should do the same. 

Turning to the role of international agencies such as the IMF and the
World Bank, Archbishop Ndungane said a World Bank official who had
recently been quoted had been correct in saying that the initiative that
will see relief given to Moçambique “is not about the debts of the past
but our hope for .... the future.”  

He added: “Every country and international agency involved in the debt
debate should embrace these views so that we can see the developing
world take a giant stride forward in economic terms.”

Archbishop Ndungane acknowledged that correcting economic imbalances
would not be easy.  But there were some successes.  

“The initiative of the World Bank and the IMF to refinance and
reschedule some of the debts of the poorest countries  -  the so-called
Heavily Indebted Poor Countries initiative  -   is an historic
recognition by these two institutions that something has to be done.”

It was regrettable, however, that the initiative appeared to be running
out of steam.  In spite of recent announcements regarding Moçambique,
for instance, creditors did not seem able to write off sufficient debt
to bring the poorest country in the world to a sustainable level, he
said.

Nevertheless the steps announced last week regarding Moçambique did
provide some cause for hope.  

“But there is also cause for concern that the historic initiative of
1996 is going to do no more than keep the accountants in the World Bank
and the G8 treasury departments happy,” Archbishop Ndungane said.