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Sign up to E-NewsWDM verdict on G8 action on trade justice, debt cancellation, more and better aid
The Make Poverty History Campaign set a range of challenges to the G8 on aid, debt and trade. What follows is an analysis of G8 commitments on all of these demands.
Debt
Make Poverty History demand: Commit to cancelling all bilateral and multilateral debts owed by any poor country that needs such cancellation in order to meet the MDGs.
Outcome of G8 2005: "The G8 has agreed a proposal to cancel 100% of the outstanding debts of eligible Heavily Indebted Poor Countries to the IMF, IDA and African Development Fund and to provide additional resources to ensure that the financing capacity of the IFIs is not reduced."
This is a significant step forward, particularly for the 18 countries that already qualify for immediate cancellation. A further 20 countries stand to benefit from the scheme in future, although only 9 of them look likely to qualify in the next few years. The scheme has several major flaws:
- Countries will have to implement failed IMF & World Bank free market policies to qualify for the cash
- It does not include a further 20 or so countries that have been identified as needing debt cancellation to achieve the Millennium Development Goals
- It does not include other regional development banks so has less utility for poor countries in Latin America and Asia
- It will mean less multilateral aid for countries in the scheme
Make Poverty History demand: All debt relief must be fully funded, and this will require additional resources from national budgets over and above the agreed increases in development assistance outlined above.
Outcome of G8 2005: It looks likely that the money to fund the debt cancellation proposal will come out of aid increases which have already been announced.
Make Poverty History demand: Vote for the sale of a limited portion of IMF gold stocks in order to fund multilateral debt relief.
Outcome of G8 2005:There was no mention of IMF gold sales in the G8 communiqué.
Make Poverty History demand: Adopt a Fair and Transparent Arbitration Process where future sovereign debt crises can be resolved.
Outcome of G8 2005: There was no mention of a Fair and Transparent Arbitration Process in the communiqué.
Make Poverty History demand: To avert future debt crises, support the giving of bilateral and multilateral development assistance to the poorest countries in grants rather than loans.
Outcome of G8 2005: There was no mention of grants rather than loans in the communiqué.
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