Daily Press Cuttings

 

Friday 14th April 2000

The Times: Debt/HIPC: Two page analysis in the tabloid section, under the headline “Why do the poor still pay the rich?” Although the world's poorest countries were assured of $100 billion in debt relief from the richest countries last year, only an estimated $13 billion has so far been cancelled, whilst not a single country has received the maximum debt relief it is eligible for. The HIPC process now appears in crisis, and Harvard economist Jeffrey Sachs condemns it as `roundabout, untransparent and utterly limited'. The main reason for this crisis is the failure of rich countries to match words with cash. Adrian Lovett of Jubilee 2000 says that at the moment there isn't the strong political will to see it through. The US Congress resists sanctioning $210 million for the HIPC Trust Fund and the EU has pledged $1 billion but only if the US puts its money in first. In response to the delays Gordon Brown has called on the World Bank and IMF to set up a joint group to get the HIPC process back on track and has stated that the speed of debt relief ``will be an acid test of the international financial institutions' ability to help the poorest countries.''

Independent: IMF/World Bank/Jubilee 2000: Independent leader says that the protesters in Washington are grievously wrong except in one important respect, the issue of cancelling Third World Debt. Even so the protesters hardly acknowledge the huge gains that have been made over the past year, nor do they dwell on the difficulties of ensuring the benefits go to the poor. The Jubilee 2000 campaign has been astonishingly successful, and it should continue to press the World Bank and its political masters to go faster. But it is unfortunate that its aims have been co-opted by the coalition assembled under the banner of “Mobilisation for Global Justice.” Ethiopia: Ethiopia has no intention of stopping its war with Eritrea, despite the tightening grip of drought and the threat of famine to 8 million people in both countries, the Ethiopian prime minister said yesterday. Meles Zenawi refused to rule out launching the next offensive in the conflict. Famine: Paul Vallely reports from the Ogaden region in Ethiopia. He describes the flood plain of Wabi Shebele, which has become an apocalyptic landscape, a place where nothing can survive. IMF/US: US Treasury Secretary Lawrence Summers called for a major shake-up of the leadership selection procedure in the wake of the fiasco surrounding the appointment of Horst Koehler as head of the IMF.

The Guardian: The World Bank admitted yesterday that the goal of halving global poverty by 2015 would prove daunting as it unveiled figures showing half the world's population survive on less than $2 a day, and 1.2 billion are still living on under $1 a day, the same as in 1987. This compared to the average earnings of people in the industrialised countries of $70 a day. Mr. Wolfensohn, the World Bank's president, conceded that these figures showed the actual numbers living in poverty had stayed the same, despite the fact that the relative proportions had dropped over recent years. Consequently, despite the levels of child malnutrition falling from 31% to 27% Mr Wolfensohn could only comment on the figures as `encouraging, but slower than hoped for' as 13 countries between 1990-98 in Africa experienced worsening U-5 child mortality rates. In addition he said that curbing the spread of AIDS had become `'a major development challenge'' with 23 million aids cases in Africa, and 5 countries with infection rates of over 20%.

FT: Indonesia: Indonesia secured agreement yesterday for rescheduling $5.8 billion of government debt falling due between 2000 and 2002 from the Paris Club group of donor countries. “The Paris Club, donor countries and the IMF know exactly our situation, we have no choice, we cannot pay,” Indonesia's co-ordinating economics minister Kwik Kian Gie said. Asia: Some of Asia's poorest countries are set to achieve internationally agreed poverty reduction targets ahead of schedule, according to the Asian Development Bank (ADB). A series of UN conferences in the mid-1990s agreed a common target that countries should reduce by half the proportion of people in extreme poverty by 2015. Bangladesh will achieve this target by 2010 and Mongolia by 2005, the ADB said. IMF/World Bank: Stanley Fischer, the IMF's acting managing director, yesterday issued a strong defence of the IMF's growing role in combating poverty. His remarks came as a the World Bank released figures showing global poverty rates failing to fall, placing in jeopardy the bank's goal of halving extreme poverty. The World Bank's Development Indicators, released yesterday, showed the total number of people living in absolute poverty falling in 1998—but only because of a reduction in the number of poor people in China. Excluding China, the number living on less than $1 a day rose to 990 million.

Thursday 13th April 2000

FT: Germany: The German government confirmed that it would write off 100 per cent of the debts owed to it by the world's poorest countries. The move will involve about 30 countries, and will cover commercial claims eligible for rescheduling. Peru: Peruvians are preparing for what will be a fiercely contested second round in presidential elections, after President Alberto Fujimori failed last night to secure the 50 per cent plus one vote he needed for a first-round triumph. Indonesia: Indonesia yesterday started two-day talks with the Paris Club of sovereign creditors in a move to roll over at least $2.1 billion of its debt. Ghana: Ashanti Goldfields, the Ghanaian mining company that came close to default last year, yesterday reported a pre-tax loss of $184 million. IMF: Article considers two outstanding areas for IMF reform. One is the drive for transparency in IMF member countries economics and financial affairs, which should help to produce early warning signals. The second is the crisis management process the IMF will use to counter any crisis to come. Ethiopia: Letter from the Ethiopian ambassador, who says that it is now urgent that the international community stops hiding behind a smokescreen of excuses and responds with urgent assistance to avert a crisis that it is, in part, responsible for.

El Pais: Cuba/G77: At the G77 inauguration Fidel Castro called for the demolition of the IMF and the total cancellation of all debt for poor countries.

The Guardian: Colombia: Colombian President Andres Pastrana in London is seeking support of £5bn to stamp out narcotics trade and revive the country's economy and end nearly 40 years of civil war. This comes the day before the UN High Commissioner releases a damning report on human rights record. IMF/World Bank/UK: In an interview with the Guardian UK Chancellor Gordon Brown said that the IMF and WB were an essential part of the battle against global poverty. Mr. Brown said that one of the main issues of the Spring Meetings was how to maintain the momentum of the HIPC. Revealing that the Treasury has given the IMF and extra $43m in recent weeks. World Bank: Severe criticism of the World Bank and its activities from environmentalist George Monbiot. He argues that the World Bank has become the means whereby the rich are empowered to steal the incomes of the poor.

IHT: Peru: Peruvian opposition leader Alejandro Toledo has demanded a revamp of electoral agencies before agreeing to run in the second round of elections. Sunday's vote was marred by unexplained counting delays, credible allegations of fraud and a suspiciously rising vote total for President Fujimori.

The Japan Times: (April 12^th) The Japanese branch of Jubilee 2000 held a rally in Tokyo on Tuesday calling for the Japanese government to write off loans to heavily indebted poor countries in Africa and Asia. 100 members gathered in front of the Finance Ministry and Foreign Ministry buildings.

Wall Street Journal: World Bank/IMF: Comment from journalist Kenneth Timmerman that the World Bank and the IMF should be closed down. Indonesia and Zaire are cases where corrupt leaders have engaged in wholesale larceny at the expense of their people. In Russia corruption has become a way of government, with billions of dollars of international aid getting siphoned into private offshore accounts. IMF/Joe Stiglitz: WSJ leading article agrees with some of the criticisms of the IMF made by Joe Stiglitz, previous economist at the World Bank, namely the need for increased transparency at the IMF and the fact that its tax-exempt bureaucrats are overly eager to impose “austeriy” on impoverished citizens of developing countries.

Le Monde: Latin America: Inter-American Development Bank President Enrique Iglesias said that following zero growth in 1999 and financial crises of 1997 and a series of natural catastrophies the Latin American continent should see a growth of 3 - 4% for the 28 countries in the region. The Bank gave the region $9.5m in 1999.

IHT: Global finance: The IMF forecasts global economic growth for the year at 4.2%. Michael Mussa, chief economist of the IMF, warned about possible interest rates increases, and said that equity prices were still high. The institution forecast recovery in Latin America led by Mexico and Brazil, and lamented the persistent failure to break the cycle of stagnation and poverty in the poorest countries.

Wednesday 12th April 2000

FT: Debt relief/Jubilee 2000: As the spring meetings of the IMF and World Bank approach there is an undignified scramble to avoid being marked out as the international laggard on supporting debt relief. Japan loudly promised 100 per cent relief on bilateral debt and raised its contribution to the HIPC Trust Fund. However, World Bank officials say that there is a tension between politicians desire to push relief through as fast as practicable, and the need for effective poverty reduction programmes. Only a handful of countries have so far received relief and ministers feel public pressure, particularly from the successful Jubilee 2000 debt relief campaign, which plans to go out at the end of the year in a blaze of achievement. The World Bank privately complains about Jubilee 2000 for consistently raising the stakes and creating expectations of ever faster and deeper debt relief, encouraging the G7 to box themselves in...With just eight months left for Jubilee 2000 to make a mark on the debt mountain, the chance of one more seismic shift in the process cannot be ruled out. IMF/World Bank/UK: Interview with UK Chancellor Gordon Brown, who argues that the IMF should be strengthened to improve its surveillance of the world economy so that it can develop “a more effective early warning system” to head off future financial crises. Comment from economist Martin Wolf that protesters against the World Bank and IMF are in effect seeking to deny the poor the benefits of a liberal world economy. Burma/UK: The UK government has taken the unprecedented step of asking Premier Oil to withdraw from its 27 per cent interest in Burma's large Yetagun gas project as part of an attempt to increase pressure on the military government in Rangoon. FT leader says that moral outrage against Burma gives the government no right to meddle in the affairs of a British company.

The Guardian: Japan/US: Focus on Okinawa, the venue of the next G8 summit and home to 75 per cent of US personnel in Japan. Japan expert Murray Sayle describes it as America's 51^st state.

IHT: World Bank: Hoping to starve the World Bank of the money it lends, activist groups have pledged to organise a global boycott of its most important fund-raising tool, World Bank bonds.

Evening Standard (London): Front page coverage of the comments of the independent mayoral candidate, Ken Livingstone, who argues that global capitalism was responsible for millions of deaths by failing to ease the Third World debt burden.

Tuesday 11th April 2000

FT: Japan: The Japanese government said yesterday it would join other G7 countries to cancel 100 per cent of the debts of the world's poorest countries. The Japanese decision reflects the government's effort, as this year's G7 summit host, to fall into line with other G7 countries, if not to take the lead in the debt reduction initiative. Japan has also softened its stance on contributions to the World Bank's debt relief trust fund, to which it had initially only committed $10 million, compared to the US' $600 million and the UK's $310 million. However, the Japanese government yesterday warned that countries which ask for 100 per cent debt relief would not be able to receive fresh loans. “It is a choice between new loans or cancellation of debts,” the foreign ministry said. Congo (Kinshasa): Fear of genocide is growing as divisions hit crisis point in the Democratic Republic of Congo. Far away from the front line the disgruntled militias and foreign rebel groups are tearing the rebel-held east apart.

The Guardian: Ethiopia: Journalist Jonathan Steele says that while we give millions to feed Ethiopia, banks and governments take it back in interest. Ethiopia has been thrown out of the Heavily Indebted Poor Country initiative because of its war with Eritrea, and last year this poorest of countries paid £60 million in debt service. Herein lies the cruellest of the current ironies. While the thousands of ordinary citizens in the west give generously to help the hunger-ravaged children of Ogaden, our governments and banks take millions back in interest. War is relevant, but the government in Addis Ababa ahs justice on its side when it says it did not start it, and has tried to negotiate its end. That does not mean that its record is entirely clear. Ethiopia/UK: UK international development minister Clare Short has vehemently argued that the UK is right to reduce long term funding while the government is spending funds on the war with Eritrea. She said that Britain's relief programme for the victims of the famine was entirely unaffected by the decision to cut back long-term assistance to the country.

IHT: World Bank: Interview with James Wolfensohn, president of the World Bank, in which he sets out his objectives for the Bank. He talks of the paradox that the dynamic global economy is the best anti-poverty programme but that with increased private-sector investment the gap between rich and poor widens. He emphasises the urgent need for effective safety nets to protect those not benefiting from the globalisation boom. Bolivia: Eight people have died in Bolivia as the anti-government action escalates. Ecuador: The task of dollarisation of the currency is underway in the hope that it will end the free-fall of the economy and the resulting recession. Government officials and economists hope it will bring monetary stability, reduce poverty, low inflation and renew economic growth. It is opening its economy to foreign ownership and increased competition, and steps to a free market economy.

Independent: Peru: It seems a second round vote is likely in the election fought between the incumbent President Fujimori and his main opposition challenger, Alejandro Toledo, amidst accusations of government fraud. Riot police beat back opposition supporters marching to the Presidential Palace in Lima. Mr Toledo has the backing of 5 of Mr Fujimori's rivals. Zimbabwe: Robin Cook threatened that the aid from the EU would be at risk if elections are cancelled.

Monday 10th April 2000

FT: IMF/World Bank Spring Meetings: Tens of thousands of protestors are expected to descend on Washington DC this week, culminating in a mass rally in front of the White House on Sunday April 16^th. Jubilee 2000, the campaign for debt relief, argues that the purely confrontational approach is counter-productive. “This is our last ever spring meeting and we don't have the luxury not to enter into dialogue,” says Lucy Matthew, spokesperson for Jubilee 2000. Weekend editorial says that the protesters are justified in complaining that those charged with making global economic decisions often fail to take into account the adverse side-effects of market capitalism. They fail to do so because they are not bound into properly accountable democratic institutions. Protesters have a case that deserves a reasoned reply. IMF: The IMF will today agree to set up an independent watchdog to monitor its activities, a significant step to countering widespread criticism of the IMF's accountability. The permanent evaluation office will report to but be independent of the board. Debt: The fragile fiscal and foreign exchange positions of Cote d'Ivoire, Romania and Zimbabwe may lead to debt defaults by those countries this year, according to Standard and Poor's, the rating agency. Peru: Exit polls showed that Alejandro Toledo had edged ahead of Alberto Fujimori, the incumbent president.

The Guardian: Ethiopia: International neglect, war and three years of drought have left refugees in Ethiopia at the end of the aid queue. The UN says that 8 million people in Ethiopia and another 8 million elsewhere in East Africa are threatened with starvation. Gode is in the centre of Ogaden, the region worst affected by the current crisis. For tens of thousands that threat is already a reality. Global finance: Oxfam's Kevin Watkins argues that wealth disparities between rich and poor countries are not just an affront to morality, they are a source of inefficiency and instability.

Wall Street Journal: Bolivia: Bolivia's president declared a state of emergency in Cochabamba, the country's third-largest city to try to quell demonstrators. The move came after a week of protests over rising water rates, unemployment and other economic difficulties. Indonesia: President Wahid said that three members of his cabinet are being investigated for corruption and are soon expected to resign. The ministers were not identified.

IHT: Debt relief/Jubilee 2000: Front page coverage of the plan to alleviate debt for the poorest countries, showing the wide support for debt relief. The big industrialised countries have started a programme to forgive as much as $28 billion in debt, with politicians on the right and left supporting it. so are banks, churches, aid agencies and the international activist movement Jubilee 2000, some of whose members were rallying in Washington on Sunday to press for the expansion of the programme. The Jubilee 2000 movement began in Britain and spread to 60 countries. It calls for a modern-day application of a biblical call for a periodic fresh start. Pope John Paul II signed on, as did celebrities including the rock star Bono and the former boxer Muhammad Ali. IMF and World Bank Spring Meetings: Coverage of the Seattle protestors and others now targeting Washington DC. The protests are to last for a week, beginning with a march for debt relief organised by Jubilee 2000 and culminating in a rally-cum-civil-disobedience events next Sunday and Monday. World Trade: The US government is opposing a World Bank proposal that would increase exports from the world's poorest and most indebted nations.