Clinton's pledges - A habinger of good things to come

CLINTON'S PLEDGES - A HARBINGER OF GOOD THINGS TO COME?

President Bill Clinton's promise to write off all bilateral debts owed by some Third World countries to the United States of America (USA) is welcome. But it has to be seen against a towering total external debt of over US$2.2 trillion owed by developing countries. The bulk of this huge amount is in multilateral debt owed to the international financial institutions of the Bretton Woods systems.

In Clinton's words, he looks at Third World debt " as the worst financial crisis in the global economy since the end of the Second World War and a grave challenge to the International Monetary Fund (IMF) and the World Bank (WB)".

But Jubilee 2000-Zambia asks: why offer debt reprieve to only 36 countries when all Third World countries are deserving? We agree with Clinton when he says that the West needs to do more in order to restore people's faith in the future and to restore their faith in the global economy and in the global markets. The Zambian experience tells it all as the nation reaps little or nothing from the global markets due to unfavourable terms of trade.

Clinton's promise of 100% bilateral debt cancellation is contingent upon SAP conditionalities. That makes the whole exercise a dangerous mockery. The evidence of SAP failures is well documented and we wonder why the insistence on these discredited programmes. SAPs are responsible for exacerbating poverty conditions in the poor countries and at best are anti-developmental. President Clinton would do well to detach his pledge from austere conditions that have become the IMF and World Bank way of doing things.

We are skeptical that the USA administration is likely to use the poor countries' failure to adhere to the imposed SAP conditionalities as an excuse for not granting them the promised debt cancellation. This would then be a continuation of the problem, compounded by blaming the debtors for failures.

Joblessness, upswing in crime, hungry mothers and children, prostitution and AIDS, falling life expectancy at birth, etc., is the order of the day in the poorest countries. With this scenario, are Clinton's debt overtures enough? Certainly not. The debt crisis should not be treated in ways that only scratch the surface of the problem. The Jubilee 2000 Zambia Campaign strongly feels that the Clinton administration should have availed monies to the IMF and World Bank to enable them finance multilateral debt cancellation adequately. Furthermore, debt relief should not in any way be used as a launching pad for imposing SAP programmes in the debtor countries.

Seen in the Zambian context, Clinton's move appears to be a step in the right direction. Reacting to this gesture, our Finance Minister Dr. Katele Kalumba was obviously elated. According to him, this relief will help Africa overcome her developmental problems. It will help the highly indebted African countries enter the new millennium on a leveled ground with the rest of the countries in the world with regard to debts. In the minister's view, the 100% bilateral debt cancellation would mean an increase in debt relief for Zambia thereby reducing pressure on the national treasury to meet the regular servicing of our immense debt.

But Jubilee 2000 Zambia notes the important condition that Clinton did put on any debt cancellation action: the freed resources must go to poverty eradication programmes. That is why we are working here in Zambia to establish an independent tripartite commission, composed of representatives from civil society, Parliament and relevant government ministries, to monitor debt negotiations and oversee poverty eradication commitments. This is already done in Uganda. Zambia must act quickly in this same direction so that debt cancellation gestures such as that of President Clinton will indeed benefit the poor.

Jack J. Zulu, Coordinator Jubilee 2000 Zambia Campaign
Friday, October 08, 1999

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