[stop-imf] Seattle PI: Debt Relief a Big Victory for Activists

[robert weissman]

*SEATTLE POST-INTELLIGENCER
* http://seattlepi.nwsource.com/opinion/228460_debt15.html

*Debt relief a big victory for activists*

/Wednesday, June 15, 2005

/*MARK ENGLER
*GUEST COLUMNIST

Thanks in large part to persistent campaigners in the global South and
their international supporters, a plan granting 100 percent multilateral
debt relief for 18 impoverished countries has been approved by leaders
of the Group of Eight industrialized countries in advance of their July
meeting in Scotland.

When President Bush stood with British Prime Minister Tony Blair at the
White House recently and argued that "highly indebted developing
countries that are on the path to reform should not be burdened by
mountains of debt," he may have been the first American president to
endorse full debt cancellation for some of Africa's poorest countries.
But he merely echoed what debt relief activists in the globalization
movement have been saying for a decade.

Observers have often remarked in recent years that globalization
demonstrators have won the moral argument about trade and development,
yet have not been able to translate their positions into policy. The
debt victory, however, provides a clear instance in which allied
activists from Africa, Europe, the United States, and beyond have
affected governmental decision-making and opened real possibilities for
human development.

For years, demonstrators promoting debt relief were dismissed or
derided. In the early '90s, citizens of the developing world condemned
an emerging situation in which some impoverished countries, especially
in sub-Saharan Africa, paid more in debt service to wealthy nations than
they were receiving from in aid. Still, the issue had little traction in
affluent countries. "There was almost zero awareness" of the debt issue
in the United States at the time, says Neil Watkins, National
Coordinator of Jubilee USA, the leading coalition of debt relief advocates.

Social movement efforts changed that. In 1998 and 1999, global
activists, who had united in the international Jubilee debt campaign,
mobilized protests of more than 50,000 supporters at the respective G-8
summits in Birmingham, England, and Cologne, Germany.

They also gained the support of religious leaders such as the late Pope
John Paul II, who held up debt relief as "a precondition for the poorest
countries to make progress in their fight against poverty."

By this time policy-makers and pundits could no longer ignore the call
for debt cancellation. Some went on the attack. Following the Birmingham
demonstrations, Andreas Whittam Smith, a columnist from the London daily
The Independent, echoed much of elite opinion by calling the Jubilee
campaign's goals "laudable" but criticizing its political strategy as
"badly conceived." He charged that the coalition's political action
would "be ineffectual ... if not counter-productive."

In fact, as grassroots efforts to highlight the issue grew, wealthy
countries responded at each stage by grudgingly expanding their limited
proposals for debt relief. While never satisfactory, the previous
G-8-endorsed plan -- the Heavily Indebted Poor Countries initiative --
nevertheless began establishing a track record for what cancellation
could accomplish.

Conservative critics have regularly charged that money from debt
cancellation would be mismanaged and would not be used to reduce poverty.

In fact, HIPC demonstrated that cancellation could be a most effective
form of foreign aid, allowing developing countries to retain and use
their own resources.

By 2004, HIPC had advanced some measure of relief to 27 countries,
including Tanzania, Uganda and Mozambique. A report from the World Bank
that year showed that together these countries nearly doubled their
total spending on poverty reduction -- including education, health care
and clean water -- in the period from 1999 to 2004.

A final turning point in the debate came in the aftermath of the
invasion of Iraq, when the Bush administration appealed to creditor
nations to forgive tens of billions of dollars worth of Iraq's foreign
debt.

With long-time advocates of cancellation unexpectedly hearing the leader
of the world's largest economic power contend that unfair debt
endangered a poor nation's "long-term prospects for political health and
economic prosperity," the moral debate was effectively closed. All that
remained was for policy to catch up.

While the G-8 agreement, involving more than $40 billion of debt, sets a
landmark precedent, Jubilee campaigners will have much work ahead of
them making sure that 100 percent cancellation is granted to other poor
countries in need, as well as to nations who hold "odious" debts
accumulated by past dictators.

Yet the challenges that remain should not obscure a major milestone --
one 10 years and dozens of protests in the making.


/Mark Engler is an analyst with Foreign Policy In Focus (www.fpif.org
<http://www.fpif.org>). Research assistance for this article provided by
Jason Rowe.