President Chissano calls for Debt Cancellation

Improved economic prospects for the Southern African Development Community (SADC) could only be realised once the economically crippling foreign debts of its members were totally written off, the outgoing chairman, Joaquim Chissano of Mozambique, said at the SADC summit, which ended yesterday.

"This has the potential to distort national priorities and deprive countries of resources for investment and stimulation of growth."

Chissano cited the example of Zambia, which had to spend more than 30 percent of its national budget on debt repayment each year throughout the 1990s, while allocating only 10 percent of the budget to social services.

His call for total debt cancellation came two weeks after the Summit of the G7 leaders in Okinawa, where the leaders of the richest nations merely reiterated their commitment to partial debt relief promised at their Cologne Summit in June 1999. The G7 leaders were widely condemned at the Summit for their failure to deliver on their promises - in the year since Cologne, not one country has received debt cancellation and only 9 have received partial relief.

Chissano said that the situation in Southern Africa required urgent action:

"Five SADC countries - Mozambique, Angola, Zambia, Tanzania and Malawi - are experiencing acute debt problems. The debt situation is also of concern in Lesotho, South Africa and Zimbabwe. We believe this is a dire situation, which deserves immediate attention from creditor nations and international financial institutions," Chissano said.

"In my own country, Mozambique, the external debt per head is almost seven times the gross national product (GNP) per capita while Angola's debt is almost four times, and twice the GNP per capita in Tanzania and Zambia."

President Chissano of Mozambique has been one of the most outspoken advocates for debt cancellation and his call for total cancellation for Africa has the formal backing of the Organisation of African Unity.