Previous SectionIndexHome Page

Third World Debt

2. Andrew Selous (South-West Bedfordshire): If she will make a statement on the repayment of third world debt. [62469]

The Secretary of State for International Development (Clare Short): Twenty-six of the 37 eligible heavily indebted poor countries have now qualified for debt relief of $62 billion. That has been provided through the poverty reduction strategy process, which has led to improvements in economic management and improved spending of local revenues and aid money.

Of the remaining 11 countries, many are mired in conflict and misgovernment. We are working to try to achieve progress on peace. We estimate that because of the fall in commodity prices, we will need an extra $1 billion by 2003 to get the countries that qualify to debt sustainability levels.

Andrew Selous: Do the Government agree with the Jubilee debt campaign that the number of countries that benefit from the HIPC initiative should be extended to include further countries that have unsustainable levels of overseas debt?

Clare Short: No, I do not agree with the Jubilee debt campaign. For example, it is proposed that Nigeria should benefit. Nigeria is massively oil-rich, and oil prices have gone up. It is terribly misgoverned and its resources are not used for the benefit of its people. To write off debt unconditionally would not bring any benefits to poor people. We are using the leverage of debt relief to write off unpayable debt and get good economic policy and better social spending. That is the right way. Countries such as Sudan, Burma, Somalia and Liberia could qualify if we could get them to peace. It is no good giving them debt relief while they are still buying arms and fighting, so I disagree. We must drive those countries forward,

26 Jun 2002 : Column 863

achieve peace and reform, and reward that with debt relief so that the countries get better economic management and the life of the people improves.

David Taylor (North-West Leicestershire): Further to the previous question, there are nevertheless several dozen countries that lie just outside the HIPC—heavily indebted poor country—criteria. Can the Secretary of State tell us what our Government are doing to help those countries to move forward to a sustainable debt framework not unlike the HIPC one?

Clare Short: The other thing that hon. Members must understand is that, because there has been such a wonderful campaign on debt, people sometimes talk as if it were the only problem. Many very poor countries do not have a debt problem, but need continuing support. For example, in Uganda, which has qualified for debt relief, 50 per cent. of the Government's revenues are supported by aid, and the country has made enormous progress in reducing poverty and getting all its children to school. We are helping country after country in the appropriate way and not pretending that the only problem is debt. Some countries are poor but do not have debt, and they need help as well.

Mr. Stephen O'Brien (Eddisbury): The Secretary of State will be aware that the debt of many heavily indebted countries is not only sovereign-to-sovereign debt, but involves private finance in the banking system. She will also be aware that back in the 1970s and 1980s, when most of the debt was extended, many of the banks knew that they were very unlikely ever to be repaid and are quite happy to continue to exercise their leverage. Given that they have now written off the amounts in their own balance sheets, should it not be possible to persuade them, in exchange for having direct access through NGOs rather than Governments, that that debt should now be relieved?

Clare Short: My understanding is that those countries have limited commercial debt and that as they are such poor countries, they did not get much commercial lending. However, some commercial debt that should be part of the HIPC process is not properly being written off, and we need to attend to that issue. In general, commercial debt is written down through the London Club. If the hon. Gentleman would like to explain his points more fully, perhaps in a letter, I shall look into the matter and respond to him.


3. Vernon Coaker (Gedling): What assessment she has made of the humanitarian situation in Angola. [62470]

The Secretary of State for International Development (Clare Short): The humanitarian situation in Angola remains very serious. More than 80,000 former fighters, 160,000 family members and 4 million displaced Angolans are all facing a humanitarian crisis. The United Nations has launched an appeal for $141 million to provide support until the end of 2002. We are contributing directly and trying to improve the effectiveness of the international response to the crisis, but Angola is at peace for the first time since the 1960s and this is a fantastically important opportunity to help it to move forward.

26 Jun 2002 : Column 864

Vernon Coaker: My right hon. Friend deserves a lot of praise for the way in which she has highlighted the plight of the poor in Africa. Is it not also the case, however, that some countries in Africa do not get as much publicity as others? On a visit to Angola with UNICEF a few months ago, it was clear that Angola was almost a forgotten country. According to UNICEF figures, Angola is the worst place in the world in which to be born. Will she do all that she can to ensure that Angola is mentioned in all the international discussions that take place and features in any anti-poverty drive?

Clare Short: Yes, I will give that undertaking. As my hon. Friend knows, the biggest chance that Africa has is that Angola, the Congo and Sudan are all ripe for peace. If we can capture peace in those three massive resource-rich countries, the prospects of the continent will be lifted. Angola has enormous and rich resources, but they are not well used for the benefit of the people. If we can get peace and development there, they will act as an engine for development in Africa.

Tony Baldry (Banbury): It is incredibly good news that Angola is at last at peace. It is also good news that Africa as a whole wants to take forward partnership through the NEPAD agreement. Great hope was held out at the G8 meeting, but there is a danger that the initiative may be distracted by other issues. Does the Secretary of State feel that, if it is distracted, it may be sensible to try to hold a summit that is devoted to African issues? I suspect that if the G8 does not make the progress on Africa for which many people hope, there will be considerable disappointment.

Clare Short: The priority that is being given to Africa at the summit is remarkable, and it is down to the efforts of our Prime Minister. A third of the summit's time has been allocated to Africa, which is unprecedented; the G8 countries do not usually discuss development, let alone the poorest continent. The hon. Gentleman is right: Africa cannot be fixed in one summit. NEPAD is a long-term development relationship that we all have to commit to and drive forward through all the channels of the international system. I am sure that the hon. Gentleman will try through his Select Committee to ensure that that is done as well as possible.

Mr. Tom Clarke (Coatbridge and Chryston): The overwhelming recollection of many of us who went to Angola during those terrible years when the war was taking place is the dreadful devastation arising from land mines. Will my right hon. Friend assure us, as I believe that she would want to, that the Government will do as much as they can to remove the legacy of those land mines?

Clare Short: Yes. Four million people are displaced in Angola as a result of the war. Getting them home, getting them farming and getting their lives moving again is crucial, and land mines have to be removed to allow that to take place. When I was recently in Luanda, members of UNITA, the rebels who were defeated in the war, said that there are fewer land mines than has been suggested to the

26 Jun 2002 : Column 865

international community. So there is a problem, but it is probably resolvable. I agree with my hon. Friend that it is an important priority to get people back on to their land.

Mr. Nick Hawkins (Surrey Heath): Although, as the Secretary of State said, the peace in Angola is very welcome, I am sure that she agrees that Angola has suffered greatly from drought and starvation, as well as from wars and bad governance. Aid to the people of Angola is being delayed as a result of protracted negotiations between the United Nations and the Angolan Government, who failed to provide the security guarantees that the UN required. What steps do the Secretary of State and Her Majesty's Government propose to try to end that stalemate and to ensure that the aid reaches the people who desperately need it?

Clare Short: The first point that I would make to the hon. Gentleman is that natural disasters rarely become catastrophes without misgovernment. Countries can cope when they have a decent Government, but the combination of natural disasters and misgovernment leads to catastrophe and famine. Unfortunately, Angola has suffered from war and misgovernment, but it now has a great opportunity.

As regards the UN, the problems are completely resolved. We have been attending to that. The UN Office for the Co-ordination of Humanitarian Affairs is about to make its appeal. We are getting food through to families and to fighters—otherwise there is a danger that they will roam about with weapons, and the country will be full of disorder. We are following the situation closely. I believe that all the problems with the UN system have been resolved, but, given what the hon. Gentleman says, I shall look at the matter again to make sure that that is correct.

Next Section

IndexHome Page