G8 lies exposed

When the 'Great Deal' on poverty and debt was announced at the G8 binge in Scotland in July, some people rushed to cheer it. Now, as the real facts come out, the truth confirms the G8 promises for what they really were.

When the 'Great Deal' on poverty and debt was announced at the G8 binge in Scotland in July, people rushed to cheer it - although many remained sceptical in the light of the G8’s record as protectors of the interests of the rich countries and the rich within them. Now, as the real facts come out, the truth confirms the G8 promises for what they really were. For example, an article by Mark Curtis in the Guardian of August 23rd contains the following in relation to the promised aid increase of $48billion a year and Blair's promise to cancel 100% of multilateral debts: 

'First, in recent evidence to the Treasury committee, Gordon Brown made the astonishing admission that the aid increase includes money put aside for debt relief. So the funds rich countries devote to writing off poor countries' debts will be counted as aid…The debt deal is not "in addition" to the aid increase, as Blair claimed, but part of it.

'Far from representing a "100%" debt write-off, the deal applies initially to only 18 countries, which will save just $1bn a year in debt-service payments. The 62 countries that need full debt cancellation to reach UN poverty targets are paying 10 times more in debt service. And recently leaked World Bank documents show that the G8 agreed only three years' worth of debt relief for these 18 countries. They state that "countries will have no benefit from the initiative" unless there is "full donor financing".

'The deal also involves debts only to the International Monetary Fund, the World Bank and the African Development Bank, whereas many countries have debts to other organisations.'

The article continues:

'The government's claim that debt relief will free up resources for health and education is also a deception. The deal explicitly says that those countries receiving debt relief will have their aid cut by the same amount. If, say, Senegal is forgiven $100m a year in debt service, World Bank lending will be slashed by the same amount. That sum will be retained in the World Bank pot for lending across all poor countries, but only when they sign up to World Bank/IMF economic policy conditions'

The article notes how increasingly privatisation is being forced on the poorest countries as an explicit condition for aid:

'Blair's assertion that aid will come with no conditions is contradicted by Hilary Benn, his development secretary, who told a parliamentary committee on July 19 that "around half" of World Bank aid programmes have privatisation conditions. Recent research by the NGO network Eurodad shows that…Eleven of 13 countries analysed have to promote privatisation to receive World Bank loans, the two exceptions having already undergone extensive privatisation programmes.

The articles concludes:

'Poor countries are free to do what rich countries tell them. The cost is huge. Christian Aid estimates that Africa has lost $272bn in the past 20 years from being forced to promote trade liberalisation as the price for receiving World Bank loans and debt relief.'

The announcements made at the G8 summit grabbed the headlines. The truth behind their extravagant claims is harder to come by. It will be exposed by the reality of continued poverty, starvation and death in those countries. They will get no relief from the rich capitalist nations of the G8.

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