13th July 2005

The G8 summit and the the overwhelming importance of the issues that were discussed have been followed closely by many in Gloucestershire. Martin Whiteside, a Stroud District Green party spokesperson and an aid and development worker, who has just returned from the Mali and Sierra Leonne where he was advising Christian Aid on their programme, responds to the G8:

The people roared, but G8 have barely whispered (i). Hundreds of thousands of us came together in an unprecedented movement of hope, passion and solidarity to demand an end to the injustice of 50,000 people dying every day from preventable causes. At last our persistent campaigning over the years has got poverty and climate change on the agenda.

The step forward by G8, as most of campaigners have commented (ii), was a disappointingly tiny one.  We should not be fooled by the G8's triumphant words, even with Geldof's endorsements. The reality is, that it is very much business as usual. Increasing aid or reducing debt barely starts to address the causes of poverty - it merely makes the system that creates poverty seem slightly more pleasant. But now that poverty is on the agenda, we mean to keep it there. If necessary we will drag the G8 along the road to justice.


On climate change - no progress

There was no progress on climate change; no action, no new targets, no US agreement nor even concern that many of those signed up to Kyoto look unlikely to meet these grossly inadequate targets. Indeed the G8 leaders even committed us to continue to support the extraction of fossil fuels through bodies like the World Bank. This is the most colossal disaster and the poorest people in the world will be the ones who suffer most from this inaction.

If Blair is to really get serious about climate change he must at the very least, demonstrate support for the Climate Change Bill, already backed by 200 MPs, that sets a legally binding target to reduce UK carbon dioxide emissions by 3% every year (iii).


On aid and debt - some gains but could also make situation worse

Proposed debt relief is tiny; a quarter of what has been spent invading Iraq and barely 10 per cent of the multilateral debt problem (iv). Both the debt deals and aid are wholly inadequate to achieve poverty reduction targets and are unlikely to prevent the continued impoverishment of the continent (v). The small print shows aid and debt relief are conditional on dropping trade barriers, opening up markets, privatisation, liberalisation and cut backs in the public sector like health and education (vi). Indeed Britain, far from being Africa's champion, has been promoting the interests of corporations, using debt and aid as levers to reshape the global economy (vii).


On conflict and arms sales - no progress

$900 billion a year is spent on arms yet only $50 billion would provide food, housing, sanitation and water for every person on the planet. Military expenditure not only diverts funds from education and healthcare, it also provides the means for the world’s many conflicts, which represent the greatest cause of extreme poverty and threat to sustainable development. If the G8 were serious about poverty they would have looked at this.


On trade - no progress

The G8 countries have made no significant commitments to change their damaging trade policies and will only consider taking limited action if poor countries accept more liberalisation, privatisation, free trade and corporate deregulation (viii). Even the World Bank’s studies show (ix) the reason Africa has moved backwards is partly because of these policies being forced on them.

African countries do not owe us any debt at all, we owe them; our wealth is based on taking the rich resources out of Africa. We could almost forget that Britain has played any role in Africa’s accumulation of debt, the accumulation of weapons, the loss of resources, the collapse in public services, or the concentration of wealth and power by unaccountable leaders. Africa is a rich continent with oil, diamonds, gold platinum and more, which has been made poor by western corporations facilitated by our governments (x).


What is needed now

Africa needs LESS aid, debt relief and trade if it comes with conditions to open up markets like much of this G8 deal. The G8 leaders favour corporations and if we are not careful, this deal will only facilitate more the corporate plunder of Africa.

Both poverty and climate change can be tackled by changing our economic system to base it on meeting needs sustainably not on the rich accumulating more and more. We need to replace the current open market emphasis of the G8, WTO and the EU with trade rules that encourage the protection and diversification of domestic economies. Exporting governments should be able to set the terms of the trade so that they benefit the majority of their people, rather than the interests of big business at present encoded in our 'free and unfair' trade rules.

This approach would allow a more secure economic future that interacts with the rest of the world in a way beneficial to the poor everywhere, thus meeting the desires of all of us worldwide who are seeking to Make Poverty History. And of course we have to start taking climate change seriously.

The campaign to secure justice for the world’s poor is far from over.  Many of us who supported MPH are now giving our support to the Trade Justice Movement: a vast expanding group of organisations including many of the development organisations (xi). Join us and help put pressure on our government ahead of the World Trade Organisation meeting in December. We can push them down that road to justice.

Read Glos Green party letter 4 months on

Notes:
(i) Adapted from Dr Kumi Naidoo, chairman of the Global Call To Action Against Poverty, who declared: "The people have roared but the G8 has whispered."

(ii) Some responses to the outcome of the G8 summit:
- World Development Movement (WDM) Head of Policy, Peter Hardstaff said: "The final communiqué is an insult to the hundreds of thousands of campaigners who listened in good faith to the world leaders’ claim that they were willing to seriously address poverty in Africa."
- CAFOD – the Catholic development aid agency could not hide its disappointment and said the G8 had “failed to deliver”.
- Jubilee Debt Campaign – the normally diplomatic body could barely contain its anger at the failure of the G8 to make any progress on June’s G7 finance ministers deal and implement the Commission for Africa's recommendations. It argued that the “G8 debt deal is not 100 per cent debt cancellation” as demanded by campaigners, “immediately benefits only 18 countries” and “reinforces the harmful economic policy conditions enforced through the Heavily Indebted Poor Countries (HIPC) Initiative”
- War on Want said the G8 had given less than a tenth of its demands on debt cancellation and not even a fifth of what it called for on aid. It said just $15bn of the $50bn was new money. John Hilary, Director of campaigns said: "This is far too little, far too late."
-  Friends of the Earth International Vice Chair Tony Juniper said: "This is a very disappointing finale. The G8 have delivered nothing new here and the text conveys no sense of the scale or urgency of the challenge.
- Oxfam said the communique had "fallen short of the hopes of the millions around the world campaigning for a momentous breakthrough".
- Christian Aid said: "This will not make poverty history. It is a vastly disappointing result. Millions of campaigners all over the world have been led to the top of the mountain, shown the view, and now we are being frogmarched down again." The charity's Steve Tibbett added: "While there are some nuggets on debt and hints of progress towards cutting strings on aid, the G8 have failed to deliver on trade."
- World Wildlife Fund climate change programme director, Jennifer Morgan said: "There's nothing meaningful in the G8 text because they couldn't come to an agreement, demonstrating the continued split between the Kyoto seven and the US."
- Friends of the Earth – the respected international environmental NGO and critical voice inside Make Poverty History, stated that the G8’s final statement on climate change “shows that leaders are still divided and have made no real progress in the fight against climate change... While the leaders carry on talking, the world continues warming.”
- Mark Malloch-Brown, the chief of staff to United Nations secretary general Kofi Annan, commenting on the announcements re aid, said: "There will be a lot of smokescreen and buckets of G8 paint thrown over old aid."
- Official Make Poverty History campaign response at:
 http://www.makepovertyhistory.org/response.shtml

(iii) The Climate Change Bill is supported by 200 MPs who have declared their support for it and 10 NGOs who have formed a coalition to work for a new climate law. The new law would set a legally binding target to reduce carbon dioxide emissions by 3% every year. It would also compel the Prime Minister to report annually to Parliament on progress towards meeting the target. The coalition includes Friends of the Earth, Help the Aged, the Association for the Conservation of Energy, Christian Aid and WWF-UK.

(iv) Only 18 countries currently qualify for debt relief (with a possible further 20) when over 60 have been identified as needing immediate debt cancellation to achieve the Millennium Development Goals. 'Poor' countries have debts to three sorts of creditors: individual countries (bilateral debt); institutions such as the World Bank and IMF (multilateral debt); and the the private sector. Previous rounds of debt relief  were restricted to fairly insignificant bilateral debts for countries that qualified for help under the heavily indebted poor country initiative (HIPC). Vast sums remained owing to the multilateral creditors. Campaign groups have identified more than 60 countries whose ability to hit the UN development goals for 2015: a halving of extreme poverty; a two-thirds cut in infant mortality; and universal primary education, is severly hampered by debt repayments which amount to $39bn in total. The Blair agenda falls far short of wiping out these debt and proposals are arguably designed to increase the countries ability to pay. The planned agreement applies to just 18 countries who have received debt relief under the HIPC agreement. Together they pay around $1bn a year to the IMF, the World Bank and the African Development Bank.

(v) The G8's promise of US$48 billion boost to aid in five years is mostly made up of money already pledged. MPH calculates that only around US$20 billion is new money. Some of this money is also likely to be raised through borrowing from future aid budgets, rather than new contributions. For most of the 50 million children who will die of poverty over the next five years, the G8 leaders have offered too little, too late. By 2010, we will still see the awful inequity whereby a child dies every 3.5 seconds, just because they are poor.

The announcement that the governments of Europe agreed that by 2015 they will give 0.7% of their national income in foreign aid comes 35 years after the target date they first set for themselves, it is still less than they extract from the poor in debt repayments, has many onerous conditions and is still too low. Infact each and every cow in Europe gets twice the amount in subsidy as the average African earns as a wage. Aid cannot compensate for unfair terms of trade.

Aid can often be damaging. Aid in the form of food, often food which has no market and is worthless - for example the large quantities of GM grain grown in the states which can't find a willing market outside the US. This so-called 'aid' acts as government subsidies to US agibusiness through the World Food Program and companies like Cargil do very nicely out of it. Meanwhile, the recepients of the 'aid' find their domestic market for home grown crops is underminded by the imports which further adds to the decline in countries ability to feed itself. Additionally, 'aid' has conditions based on the corporate agenda of the governments providing it and are tied to contracts for arms sales, major construction projects, resource consessions etc. The structural adjustments of the IMF are typical of the interference imposed on indebted nations by the west - forcing opening of markets to westen companies, privatising national resources, and creating 'flexible' labour forces to encourage foreign investiment.

(vi) Mark Curtis, until recently director of the World Development Movement and author of 'Unpeople: Britain's Secret Human Rights Abuses' writing in the Guardian 9/07/05. George Bush has said the US will only give money to countries pursuing free market policies. Paragraph 2 of the finance ministers' statement says that to qualify for debt relief, developing countries must "tackle corruption, boost private sector development" and eliminate "impediments to private investment, both domestic and foreign." G8 Finance Ministers, 10-11 June 2005. Conclusions on Development

(vii) Gordon Brown told a Chatham House audience that this was "a smart business proposition: enlightened self-interest at its best ... for the world economy to prosper and for the companies operating in it to have markets that expand, developing country growth is a necessity". Without this, rich countries were "unlikely to maintain the growth rates we have enjoyed over the past 20 years". Again, poor countries help western companies, at their own expense. A March Treasury report on priorities for the UK presidency of the EU calls for "greater flexibility in product markets, labour markets and capital markets ... a new approach to regulation and "taking a lead in multilateral trade liberalisation".

A recent example is that a condition of debt relief for Tanzania was privatisation of its water supply. British aid money, money that should have gone on poverty relief, was spent promoting this deal. Two years into the the ten year contract, British company Biwater has been kicked out of Tanzania. Biwater were removed because Tanzania experienced deteriorating water supply. It will be the British taxpayer who will have to foot the bill as the deal was underwritten with export credit guarantees. The poor of Tanzania may also have to foot the bill as Biwater are suing the Tanzania government for compensation for being kicked out of Tanzania. A similar attempt is being made to privatise water supply in Ghana. Many other examples can be provided.

Corruption raised its head as an excuse for not cancelling debt, yet there was no such concern at the time money was lent; Congo at the height of the despotic rule of Mobutu or even to Saddam Hussein when he was gassing the Kurds. Congo now spends 37% of its government revenues servicing debt. This in a country where the average income per capita is $90. Amazingly not a single G8 country has ratified the international anti-corruption treaty and not a single UK company has been prosecuted in the UK for bribery and corruption abroad. Indeed when US Secretary of State Colin Powell in February 2003 presented his dodgy dossier to the UN to justify war with Iraq he pointed to a chemical weapons facility, 'chlorine plant Faluja 2', 50 miles outside of Baghdad. A facility which the US said was a key component of Iraq's chemical weapons arsenal. The British agreed it should be destroyed yet it was a British company that constructed it 17 years earlier, a project underwritten by export credit guarantees from the British government. At that time there was even a warning from the MoD that the plant 'could be used in the manufacture of phosphorus trichloride, a key nerve agent precursor', and Foreign Office Minister Richard Luce went so far as to warn what it would do to Britain's image if news of the deal leaked, and advised 'I consider it essential everything possible be done to oppose the proposed sale and deny the company ECGD cover.'  However Trade Minister Paul Channon overruled it saying:  'A ban would do our other trade prospects in Iraq no good.' These 'other trade prospects' being further lucrative arms deals. A massive $1 billion was lost in Iraq when Margaret Thatcher bankrolled Saddam Hussein, the long suffering British taxpayer picking up the bill.

(viii) The G8 countries made no significant commitments to change their damaging trade policies and will only consider taking limited action if poor countries liberalise in return. The G8 push to get poor countries to liberalise has even extended as far as offering ‘aid for trade’ bribes - giving poor countries some extra aid money in return for liberalisation. This is despite UN research demonstrating that the liberalisation forced on least developed countries during the 1990s was associated with rising poverty, with the countries worst affected being those that had liberalised most - even though these countries received substantial aid during the same period.

World Development Movement (WDM) Head of Policy, Peter Hardstaff said: “The G8’s approach on trade seems to be ‘Ask not what we can do for the poor, but what the poor can do for us’.”

Christian Aid statement: "Trade liberalisation has cost sub-Saharan Africa US$272 billion over the past 20 years. Had they not been forced to liberalise as the price of aid, loans and debt relief, sub-Saharan African countries would have had enough extra income to wipe out their debts and have sufficient left over to pay for every child to be vaccinated and go to school."

(ix) As the World Bank's own figures show, across the 20 years (1960-80) before it and the IMF started introducing strict conditions on the countries that accepted their loans, median annual growth in developing countries was 2.5%. In the 18 years after (1980-1998), it was 0.0%.
See also: William Easterly, February 2001. The Lost Decades: Developing Countries’ Stagnation in Spite of Policy Reform 1980-1998, World Bank.

(x) The Movement for the Survival of the Ogoni People, for example, demanded that Shell compensate the people from whose land it had pumped roughly $30bn worth of oil since the 1950s. The company turned to the government for help, and the Nigerian military turned its guns on demonstrators. Before his state-ordered hanging, Saro-Wiwa told the tribunal: "I and my colleagues are not the only ones on trial. Shell is here on trial ... The company has, indeed, ducked this particular trial, but its day will surely come." Ten years later, 70% of Nigerians still live on less than $1 a day and Shell is still making superprofits. Equatorial Guinea, which has a major oil deal with ExxonMobil, "got to keep a mere 12% of the oil revenues in the first year of its contract", according to a report on the CBS news programme 60 Minutes - a share so low it would have been scandalous even at the height of colonial oil pillage. The World Bank's 2003 Global Development Finance report notes that Africa gives, "the highest returns on foreign direct investment of any region in the world". As Naomi Klein (9/06/05) writes: "Africa is poor because its investors and its creditors are so unspeakably rich."
See: http://www.thenation.com/doc.mhtml%3Fi=20050627&s=klein

(xi) More about the Trade Justice Movement at:
http://www.tjm.org.uk/about.shtml
Websites with more information:
www.glosgreenparty.org.uk
www.greenparty.org.uk
www.wdm.org.uk/
www.makepovertyhistory.org/
www.whiteband.org/
www.live8live.com/
www.resistg8.org.uk/
www.dissent.org.uk/
www.g8alternatives.org.uk/
www.g8blockades.org.uk/