More than 250 international debt managers and policy makers attending a U.N. Conference in Geneva agree the proposal by the G-8 industrialized countries to cancel the debt of 18 of the world's poorest nations is good as far as it goes. But, they say it does not go far enough.
Two weeks from now, eight of the world's richest countries will meet in Scotland. At that time, the G-8 countries are expected to cancel the debt of 18 of the world's poorest countries.
Chief of UNCTAD's (United Nations Conference on Trade and Development) Debt Management Division, , says the G-8 proposal is in line with long-standing calls by the U.N. Conference on Trade and Development to cancel debt.
"This month's G-8 plan, therefore, marks in our view a laudable step forward in the process of achieving an endurable exit from unsustainable debt burdens for the poorest countries," said Philippe Straatman. "Even though countries included are only the HIPC [Highly Indebted Poor Countries] countries. Now I think further efforts are needed."
Other experts agree with this assessment. Gail Hurley is a Policy and Advocacy Officer with EURODAD (European Network on Debt and Development), a network of 48 private organizations. She says 62 countries need debt relief, not just the 18 HIPC or Highly Indebted Poor Countries designated by the G-8.
"This list of HIPCs was drawn up by creditor nations in 1996 and left many other deserving, equally poor countries squarely off the list, such as Nigeria, Kenya, Haiti and others, which we think is plain unfair," she said.
Anthony Mothae Maruping is Executive Director of Macroeconomic and Financial Management Institute for Eastern and Southern Africa. He says he agrees with the G-8 view that corruption is a problem in many poor countries. But, he says it is not altogether just to link debt cancellation with the eradication of corruption.
"Corruption is not only in developing countries," said Anthony Mothae Maruping. "It is also in developed countries. Because in a corruption situation, you have the corrupter and the corruptee. Now we are just looking at corruptees who have to be looked after by the developing countries, but what about the corrupters? The multi-nationals that are corrupting poor people in developing countries. Developed countries are not so clean themselves. Both the developed countries and developing countries. We have to stem out the corruptees as well as the corrupters."
UNCTAD economists say debt relief alone is not a panacea and does not address the long-term needs of developing countries. They say there has to be a comprehensive development strategy to get poor countries out of the debt trap. They say rich countries must provide more development assistance and they must open their markets so poor countries can export their commodities.