[stop-imf] Kenya: Government has no moral authority to service debts

[Robert Weissman]

Monday February 20, 2006

/East African Standard /(Kenya)



*Government has no moral authority to service debts *

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/By Njoki Njoroge Njehu and Soren Ambrose/



Before his recent debacle, former Finance Minister David Mwiraria made
headlines in mid-January by calling for the cancellation of Kenya's
external debts. That call, made in the context of the current drought, a
visit by renowned economist Jeffrey Sachs, and the release of a report
authored by former Planning Minister Anyang Nyong'o, represented a rare
consensus between the Government and its critics.



Mwiraria had previously been reluctant to call for relief on the grounds
that it might harm Kenya's credit rating. Unfortunately, the call came
too late, seven months after the end of negotiations on the G8 debt pact
that wrote off the multilateral debts of 13 African countries.



In any case, Mwiraria's resignation three weeks later under a cloud of
corruption allegations probably undermined any attention he managed to
get with his call. Indeed, the officials at the International Monetary
Fund (IMF) and World Bank who read Mwiraria's earlier comments probably
took some comfort in the fact that his call would now be tarnished as
another attempt at cutting corners by a corrupt minister.



But Mwiraria was not the only minister making the call. On January 27,
Foreign minister Raphael Tuju said the quest for debt cancellation would
define our engagement with multilateral partners.



Scandals and questions of timing aside, Kenyans should welcome the
Government's change of course on debt cancellation and demand that it
follow through. For this is a belated recognition that paying the
external debt, which consumes about 22 per cent of the annual budget, is
a significant, unnecessary, and unjust weight holding the Kenyan economy
down.



Nothing about the corruption scandals currently dominating the headlines
changes any of the essential facts about the massive 25-year scandal
that is the international debt crisis.



Mwiraria, Nyong'o, Tuju and Sachs are all correct in saying Kenya cannot
meet the minimal, but universally-endorsed, Millennium Development Goals
if the debt is not eliminated. They are right, too, to dismiss the
reputed risk to Kenya's credit rating in demanding debt cancellation. In
the past year, Nigeria and Argentina have demonstrated that governments
which stand up to creditors and put the interests of their people first
are not penalised, but rewarded with financial and political respect.



And although they don't emphasise it, these latter-day anti-debt
campaigners would be right to point out that the debt treadmill on which
the IMF and World Bank have kept Kenya and dozens of other developing
countries is fuelled by claims that have been exposed as illegitimate.



If Parliament agrees to civil society's demands to open the debt
register, we could prove that most of these debts resulted from projects
and programmes which Kenyans never agreed to, and which did more to harm
than good.



It is on such grounds that the US and other powerful countries have
successfully argued for the cancellation of Iraq's debt. Why make
Kenyans pay for past corruption?



Remember, it is through such debts and the debilitating conditions the
IMF and World Bank attach to the indebted countries that Kenya's
sovereignty is compromised.



Elimination of Kenya's external debt is a necessary condition for
achieving the MDGs and beginning to restore Kenya's economic and
political sovereignty. But as the unraveling of the Goldenberg and Anglo
Leasing scandals demonstrate, this alone will not suffice to do the job.



If Kenyans are ever going to get justice in the global economic system,
they must impose genuine accountability on their political elite. Not
because the World Bank, the IMF, the US Ambassador or Sir Edward Clay
says so, but because such justice would be meaningless without a
national government committed to the responsible exercise of its
economic and political sovereignty.



As long as the public, the media, and the donors assume the Government
is accountable first to donors, Kenya is unlikely to free itself from
corruption, or regain political and economic sovereignty.



For the better part of the last fifteen years, Kenya has had donors
publicly targeting corruption and cutting off aid. Integrity must be
integral; it cannot be imposed from outside.



Recently, the World Bank's Vice President for Africa, Gobind Nankani,
talked to the Press about Anglo Leasing, saying it was very important
that the Government demonstrates its commitment to good governance by
taking action.



Of course, his comment will be universally read as referring not so much
to what Kenyans need, but what the World Bank will insist on before it
releases more aid.



A conscious decision to redirect our expectations of accountability is
required. Kenyans must be the ones to frame, carry out, and conclude
this debate and not the World Bank.



After demanding lasting, genuine accountability from their politicians,
they should be demanding democratic governance that works for the people
rather than for the World Bank and the foreign governments whose
interests it represents. And by definition, democratic governance is
incompatible with the exorbitant conditions and controls imposed by the
IMF, the World Bank, and other official creditors.



As we applaud Mwiraria's resignation as evidence of increased
accountability in government, we should also recall one of Mwiraria's
signal accomplishments as Minister of Finance; the freeing of the budget
from reliance on donor funds.



That is a first in the region and a concrete step toward reclaiming
Kenya's sovereignty. It deserves to be followed up with more steps to
marry accountability with self-reliance.



We can start today to reclaim Kenya's sovereignty and define a rational
sense of national priorities by holding the Government responsible for
signing the checks that pay off illegitimate debts, and in the process
diverting crucial national resources from starving people and unemployed
Kenyans.



Good governance would produce an unambiguous declaration that for the
good of its people and the realisation of justice, the Kenyan Government
will repudiate the debt that has impoverished and limited Kenyans for so
many years.



That step would be unlikely to win praise from the World Bank or even
Sir Clay, but by putting the people ahead of creditors, it would be the
beginning of true accountability.



/The writers are anti-debt campaigners/