[stop-imf] Africa should not pay its debts - Jeffrey Sachs

[robert.weissman@essentialinformation.org]

http://news.bbc.co.uk/2/hi/business/3869081.stm

BBC News     July 6, 2004

Africa 'should not pay its debts'

A special adviser to the United Nations secretary general Kofi Annan has
said African countries should refuse to repay their foreign debts.

Mr Annan's economic adviser Jeffrey Sachs first called on developed
countries to cancel Africa's debts.

But failing that, he said Africa should ignore its $201bn (=A3109bn) debt
burden.

Economic analysis, he said, had shown that it was impossible for Africa to
achieve its development goal of halving poverty if it had to repay the
loans.

"The time has come to end this charade," he said.

"The debts are unaffordable. If they won't cancel the debts I would suggest
obstruction; you do it yourselves."

'A serious response'

"Africa should say: 'thank you very much but we need this money to meet the
needs of children who are dying right now so we will put the debt servicing
payments into urgent social investment in health, education, drinking water=
,
control of aids and other needs,'" he told the BBC's World Business Report.


Mr Sachs insisted that such a response was serious and responsible,
providing that the money was used transparently and channelled only into
urgent social needs.

And he denied that it would bar African countries from accessing money from
the capital markets in the future.

"They won't be able to access those markets anyway until the debt is
forgiven,=94 he explained, adding that there is no reason why they shouldn'=
t
be able to borrow again provided the forgiveness was negotiated in a
cooperative manner.

Mr Sachs is special adviser to Kofi Annan on global anti-poverty targets.

Reluctance He made his comments at a conference on the eve of a summit of
the heads of state of the African Union in Ethiopia.

He called on the developed world to double aid to Africa to $120bn a year i=
n
order to meet commitments made in 1970.

There is some sympathy in some of the rich donor countries for the idea of
debt cancellation.

The British Chancellor of the Exchequer or finance minister Gordon Brown,
did float the idea before the recent summit of the G8 major powers in the
United States, although there has been no decision and some creditor
countries do have a history of reluctance on debt relief issues.

But none would be likely to welcome a unilateral decision by the poor
countries themselves simply to stop paying their debts, which are owed
mainly to international organisations such as the World Bank and to rich
country governments.