Jubilee Research: Africa's poorest 'should refuse to repay debt'

July 6, 2004 Tuesday
London Edition 1

Africa's poorest 'should refuse to repay debt'

By ANDREW ENGLAND
ADDIS ABABA

A senior United Nations economic adviser yesterday suggested that impoverished African countries should refuse to pay foreign debt worth tens of billions of dollars.

Jeffrey Sachs, a special adviser to Kofi Annan, UN secretary-general, told African leaders and diplomats they should call on rich nations to cancel "100 per cent of the debt" owed by highly indebted countries, most of which are in Africa.

If they did not, "I would suggest obstruction - you do it yourselves," Mr Sachs told a conference dealing with Africa's perennial food crises.

"The time has come to end this charade, the debts are unaffordable," he added. "No civilised country should try to collect the debts of people that are dying of hunger and disease and poverty."

Statistics published recently by the UN Conference on Trade and Development show the 34 poorest African nations - the majority of the world's least developed countries - had a combined foreign debt of Dollars 106bn (Euros 86bn, Pounds 58bn) in 2002.

More than 40 per cent of sub-Saharan Africa's population survives on less than a Dollars 1 a day and 200m Africans are underfed, according to the African Union (AU).

A number of African presidents, as well as advocacy groups, have long called for the debt to be cancelled, arguing that Africa has little chance of combating poverty while servicing vast loans.

"Our analysis has shown that there is absolutely no way you can make debt payments on debt and achieve the development goals," Mr Sachs said. The UN's Millennium Development Goals call for halving extreme poverty and hunger in developing countries by 2015.

Mr Annan yesterday called for a "green revolution" for Africa to improve agricultural production and rural development. But he acknowledged that halving hunger by 2015 seemed "more a far-off fantasy than an achievable target" for dozens of countries.

The conference was held on the eve of the third AU summit in Addis Ababa, during which Alpha Oumar Konare, AU commission chairman, will present an ambitious Dollars 1.7bn, three-year plan intended to lead the continent towards greater integration and out of poverty.

But many regard his targets as unrealistic for an institution that is constantly underfunded.

Mr Konare argues that the time has come for African leaders to back the grandiose plans they endorsed when the organisation was launched two years ago as a replacement for the much-maligned Organisation of African Unity.

"I know that it is true that our countries are poor," he told the Financial Times, "but we need to make sacrifices to steer (Africa) out of poverty."

The record so far is not encouraging. The AU's current annual budget is just Dollars 43m. Seven months into the year, members have contributed only Dollars 13m.

Mr Konare's plan would raise the budget to Dollars 600m with members committing 0.5 per cent of their budgets to the AU.

However foreign ministers and diplomats, who met ahead of the summit, have already concluded it would be impossible to raise the funds and have recommended a special session later this year to discuss a more manageable budget.