Camdessus reassures on gold sales; South Africa calls G7 debt policycriminal (fwd)

[Robert Weissman <rob@essential.org>]

IMF Reassures Gold Markets on Sales
Date: Mon Jul 05 10:30:11 CDT 1999

        GENEVA (AP) -- Gold markets have nothing to fear from the
International Monetary Fund's plan to sell gold to finance debt relief for
poor countries, the IMF's managing director said Monday.
        Responding to the ``legitimate preoccupation'' of gold producing
countries, Michel Camdessus said he believes that ``we can find a solution
that everyone can accept unanimously.''
        Leaders of the world's main industrial nations meeting in June in
Cologne, Germany, gave the go-ahead for the IMF to sell 10 million ounces of
its $27 billion in gold reserves to help finance the IMF portion of debt
relief for poor countries.
        In the United States, Senators Jesse Helms and Chuck Hagel have
charged that the sale would hurt many of these nations and the U.S. gold
industry. Lawmakers representing gold mining states have also objected.
        ``We're selling 10 percent of our gold. That means we're keeping 90
percent of our gold and we have no desire to see our remaining 90 percent
losing any of its value,'' Camdessus told reporters in Geneva, where he was
attending the annual meeting of the U.N.
Economic and Social Council.
        ``So we won't be so stupid as to sell the gold in a disordered and
unplanned way which risks depressing further an already depressed market.''
        Although U.S. approval will be needed for the sale, ``I have no
reason to doubt the good sense of the United States and I think we will be
able to convince them that the way we will proceed poses no major danger to
the gold market or to American gold mines,'' Camdessus said.


G7 debt policy 'criminal', South African minister tells summit
Date: Mon Jul 05 09:00:12 CDT 1999

DURBAN, South Africa, July 5 (AFP) - South African Trade Minister Alec Erwin
slammed G7 policy on Third World debt as "criminal" at an economic summit of
southern African political and business leaders here Monday.
   "For the G7 to be cautious on debt is criminal. It's criminal," Erwin
told the World Economic Forum regional summit, speaking on one of the
central themes of the two-day gathering which ends Tuesday.
   He was responding to sharp criticism by US Deputy Commerce Secretary
Robert Mallett, who berated southern African states for moving too
cautiously on regional trade integration.
   "Investors hear this cautious conversation, and this unwillingness to
step out aggressively, and they say well, Africa is not yet ready for prime
time. That's the reality," Mallett bluntly
told the gathering of 850 regional political and business leaders.
  Mallett said the 14-nation Southern African Development Community (SADC),
which is involved in complex discussions on an internal free trade
agreement, lacked cohesion.
   "The global economy is here and, unlike Europe, you don't have 40 years
to get your act together.
   "Unless there is real cohesion between the public and private sector,
unless there is a realisation that the region has to be integrated ... you
are not going to make it," he warned.
   An irritated Erwin responded: "You have to distinguish between bravado
and realism. And we hear a lot of bravado at these conferences."
   "In Mozambique, Zimbabwe, Zambia, how can we do projects in
public-private partnerships when the sovereign risk is so massive because of
debt?" he asked.
   "If we want to build southern Africa, G7 can help, not by preaching to us
about governance, but by taking debt off the books so we can have genuine
public-private partnerships," Erwin said.
   Mozambican Trade Minister Oldemiro Baloi said moving too quickly on
integration could threaten stability by leading to exclusion. "Most of the
conflicts we have are about exclusion."
   Mallett said the support of G7 nations for the region was less than
wholehearted because of a perception of a lack of urgency among southern
African states.
   "If regional integration proceeded with more vigour and if SADC was able
to meet the security needs of the region as a region, and if it met common
trade and tax policies, then there would be greater support from the G7
countries.
   "But we are a long way from that in this region," Mallet said.    The
world's seven richest countries -- the United States, Britain, Germany,
France, Japan, Italy and Canada -- stopped short of a total debt write-off
for poor nations at their meeting in Cologne, Germany, last month.
   A free trade deal for the region would result in the creation of an
integrated market of more than 190 million people and a combined gross
domestic product (GDP) of more than 150 million dollars, according to the
SADC secretariat based in Botswana's capital Gaborone.
   But the region is faced with increasing trade imbalances between the
regional powerhouse South Africa and its poorer neighbours, the summit heard
Sunday.
   SADC committed itself to the creation of a free trade area under a
Protocol on Trade signed in 1996.