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Debt Deal Does Little for Africa's Core Problems

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Debt Deal Does Little for Africa's Core Problems

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Debt Deal Does Little for Africa's Core Problems

Debt Deal Does Little for Africa's Core Problems

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Britain has declared it will forgive nearly $17 billion of African debt. Richard Dowden, director of the Royal African Society in London, talks about the debt relief agreement.

STEVE INSKEEP, host:

The new president of the World Bank is touring Africa this week. Paul Wolfowitz started his visit after the world's wealthy nations agreed to cancel $40 billion in debts owed by poor nations, mostly in Africa. To discuss how that agreement might affect poverty in Africa, we've called Richard Dowden. He is director of the Royal African Society which studies and advocates for African issues.

Welcome to the program.

Mr. RICHARD DOWDEN (Director, Royal African Society): Good morning.

INSKEEP: Does this debt cancellation agreement really get at the problem of poverty in Africa?

Mr. DOWDEN: No, it doesn't. It alleviates poverty at the margins. Africa's problem is that it's not earning enough money and that's largely because the prices paid for its commodities, its minerals and its agricultural produce, has gone down by something like 60 percent in the last decade. So that's its problem and it hasn't become a manufacturing continent and it's still just not earning not enough money. That's why it's been unable to pay its debts; plus, the political problems within Africa, which include corruption and things like that, where a lot of the money has been misused.

INSKEEP: Well, I want to understand what you said when you said the prices for Africa's commodities are going down. This is a continent with a lot of oil. We've heard prices are going up. There are diamonds. There are gold. But it doesn't average out for the Africans?

Mr. DOWDEN: No, it doesn't. Most of the oil money has not been used well in countries like Nigeria and Angola. In Angola, it funded a war for a long time. Diamonds and gold, well, yeah, it pays for a few people to hit the rocks with pickaxes, but it doesn't actually bring a great deal of wealth except in Botswana where it has been very well used. There are 52 countries in Africa and not all of them have got oil. There's only about 10 of them have oil, and many of those oil-rich countries are very corrupt because they're not actually taxing their own people, making them accountable. The money comes straight in at the top and often it doesn't trickle down to the people who really need it.

INSKEEP: What does this debt cancellation agreement do about that corruption problem?

Mr. DOWDEN: Well, it says that the African governments that have been given the relief must spend it on health and education and infrastructure. Now I would love to be proved wrong because I would love to see a lot more education and more health clinics in Africa, but the problem in many of these countries is there's not actually a capable civil service of delivering that money down to paying the head teacher, buying the books in the school, delivering medicines to the clinic in the village, and that's one of Africa's problems, that I think a lot of the money has actually got to be invested in rebuilding the states, rebuilding the civil service, both the physical infrastructure and training people to run them.

INSKEEP: This debt cancellation comes after a widespread movement for precisely that. Are there other movements to alleviate other causes of poverty, perhaps more significant causes in your view?

Mr. DOWDEN: Well, there is the great push for aid. Tony Blair, the British prime minister, wants to double aid to Africa to $50 billion and then double it again to $100 billion. So that's another route just to give Africa more money, but personally I think far, far more important, the removal of the barriers which prevent Africa earning its own living. And here we're talking about agricultural subsidies, and I'd have to mention the 3, $4 billion a year that goes to cotton farmers in America by its own government, a country that believes in free trade, but this is bringing down the price of cotton in the world and putting farmers in places like Mali and Niger out of business. They simply can't afford to compete with those very low prices caused by the subsidy in the United States.

INSKEEP: Richard Dowden is director of the Royal African Society which is based in London.

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