Press Responses - July 17, 2001

CBC Commentary

This week, I will join thousands of others on the streets of Genoa in northern Italy, in a vocal, colourful, mass demonstration.  I will be protesting the meeting this weekend of the leaders of the G7+Russia, the richest countries of the world.  These street protests are not unlike those seen in Seattle, Washington, Prague and Quebec City.  The mantra of street protests "hi ho hi ho, x,y or z have got to go" will only change when the mantra of globalization chanted by the G7  "liberalize and privatize", changes. The x,y and z of the global economy  -- the WTO, the World Bank and the IMF, are dominated by the G7. These so-called public institutions impose and enforce a particular globalization -- one characterized by trade and investment liberalization, privatization, and the reduction of public sector expenditures, in other words, social service cutbacks or the removal of subsidies on food, gas or water.  

The Bank and Fund impose this programme through conditioning loans or more recently, by conditioning debt relief. In the last few years, an enormous lobby effort has taken place around the world to get the G7 to address the debt crisis of the poorest countries. 

The first big global mobilization for debt cancellation, resulted in the Highly Indebted Poor Country Initiative. It saw limited debt relief for a few countries with on average, 100 conditions attached for each country.

On-going outrage at this non-solution resulted in a bigger mass movement, popularly known as Jubilee 2000. As a result, the last two G7 Summits have focused on the theme of debt relief. Now the World Bank and International Monetary Fund provide debt relief after three years of successful "globalization".  But, in addition, the country must agree to commit any "savings" from debt servicing to a poverty reduction strategy endorsed by the Bank and the Fund. They will analyse the poverty reduction strategy to identify any gaps in the country's approach to poverty reduction. The country will have to fill these gaps. That means that while the Bank and the Fund are writing off some debt, the country has to take on new loans to "liberalize and privatize". 

Since the G7 in Koln, only 23 countries have qualified for debt relief. In return for debt relief, Honduras is being forced to privatize its telecommunication sector, liberalize its mining sector and impose bank service fees. In neighbouring Guatemala, the privatization of the telecommunications sector resulted in the removal of coin-operated phone booths and the introduction of phone cards. They cost more than the daily wage of a poor person.  In Bolivia, Bank imposed water privatisation resulted in increased user fees - from $5 a month to $25. The average worker earns $80.00 day.  Protests have resulted in 8 dead. Just last month, three people were killed in Papua New Guinea while protesting privatization of the national bank and water and electricity supply. The Congo has recently been refused debt relief by the Bank and the Fund. One reason given, failure to privatize. 

The debt crisis is long from being over. It won't be until 100% of the debt of the poorest countries is cancelled. Canada has agreed to write off all of the debt owed to Canada from the poorest countries. Will Canada push the World Bank and the IMF to write off the uncollectable debts owed to them? Will the G7 agree to remove this key lever of control and power? What can we do, but raise our voices and take to the street?        For Commentary, I'm Pam Foster in Ottawa.

Pam Foster is the Coordinator of the Halifax Initiative, a coalition of non-governmental organizations, based in Ottawa.