|
The Case for Debt Cancellation and Increased Aid to Africa |
|
 |
|
Wednesday, 15 June 2005 |
Recently, George Ayittey of American University went before the standing committee of the Canadian Parliament on Foreign Relations to present his thoughts and recommendations on the subject of aid to Africa. Ayittey expanded the talking points for that presentation to respond to the new British-led initiative for debt cancellation, increased aid, and Africa-friendly trade practices. This revised version was published in the Prof. Toyin Falola-moderated USA/Africa Dialogue forum, of which I am a member. The forum’s archive can be accessed at http://www.utexas.edu/conferences/africa/ads/index.html.
Ayittey’s write up on Africa's debt crises (published as dialogue 773) raises a lot of contentious issues. Because aid and debt are two extremely important issues on which Africa's economic and social future partly hinge, it is important to respond strongly to some of the issues in the piece. I will preface this write-up with a declaration of my disagreement with the ideological and philosophical premise of Ayittey’s presentation on the subject of aid in and debt “relief” in Africa. Ayittey’s presentation is steeped in the widespread but erroneous notion that aid and foreign loans are charitable acts on the part of the West toward Africa and that their forgiveness, being undeserved, should be considered as acts of remarkable benevolence. This is one of the biggest myths being naively reproduced in current discussions on Africa’s economic predicament. I do not subscribe to this naïve and simplistic rendering of two institutions which have been used by the West as mechanisms for controlling and self-interestedly tele-guiding African economies. As very perceptive and informed commentators have opined, the reluctance of Western countries to sign on to a program of total debt cancellation is informed partly by their anxieties regarding the potential loss of these key tools of Western economic hegemony in Africa. Back to Ayittey’s talking points.
First of all, Ayittey's write-up does a disservice to the Blair plan by reducing it to yet another attempt to raise and throw money at Africa's myriad problems. This is an unfair caricature of a three-pronged, nuanced proposal, of which aid is only one aspect. Debt relief is another aspect. For me, though, the most important aspect of this proposal--and this is what makes it radical in an unprecedented way--is its courage in calling for the elimination of many anti-Africa Western trade practices, not the least of which are the agricultural subsidies which not only close Western markets to African producers but also belies the West's rhetoric of free trade and globalization. If this proposal is embraced at next month's WTO talks, it will do infinitely more for Africa than aid or debt forgiveness can do over the long term.
Secondly, the write-up's comparison of African aid to the Marshall plan is outrageous, misleading, and disingenuous. By Ayittey's own assertion, the $450 Billion purportedly "pumped" into Africa between 1960 and 1997 was not free money but a plethora of soft loans, with conditions that are anything but soft. The Marshall plan, on the other hand, was direct, free America aid, the only condition being that the nations of Europe should form a collective and devise a comprehensive plan on how to spend the money. One could say that the world has changed and that the political threats and goals which made the case for the Marshall Plan no longer exist today. That may be so, but who is to say that hunger, disease, destitution, and anger in Africa pose a lesser threat to the United States than did the advancing wave of Soviet Socialism?
Yes, aid without conditionalities is counterproductive. However, does Ayittey not know that all previous aid to Africa carried stringent conditionalities but that African leaders and states, with the active support and encouragement of Western actors and financial institutions circumvented these conditions, thus getting us into this debt conundrum? If these conditionalities have been applied to African regimes and haven't worked, isn't it time we looked at applying the same set of ethical conditionalities to the Western institutions and actors who facilitate the merry-go-round of aid, embezzlement, Swiss accounts, and more recycled aid-loans?
Ayittey argues that no African government has been called to "give full public accounting of who took what loan for what purpose." This is sadly true, and I have no doubt in my mind that the day of reckoning is coming for all the African leaders who mortgaged our collective patrimony and destiny by taking and squandering foreign loans and aid on behalf of expectant and needy Africans. I have no illusions, however, that the West will be the champion of such a project of accountability. The West will not demand such an accounting, NOT because of its historical hangovers over past injustices, as Ayittey erroneously alleges—as anyone can see, the West has since shrugged off the guilt of the slave trade and colonialism, and mainstream revisionist histories which exonerate and assuage the West's conscience now abound. The West will not initiate a full process of soul searching and accountability because such a full accounting will inevitably lead the indictment of the West itself and its complicit financial institutions. Such a probe may also implicate some respectable Western figures who have done and still do business with corrupt African leaders and who are either in power in Western countries or have politicians in these countries who are beholden to them. In short, such a process of accounting will open Pandora's Box and reveal the underbelly of the fraudulent, two-sided aid-loan-corruption poverty producing machine. This is why the West will not demand full public accounting. It will not investigate its own institutions and practices.
Ayittey's analysis is thus a one-sided one at best. If African kleptocrats have yet to be held accountable for collecting and misusing dubious aid, no Western contractors, financial institutions, bankers, and economic hitmen (apologies to John Perkins), who wickedly pushed (read imposed) dubious waste-pipe projects on greedy African bureaucrats and politicians, have been called to account for their destructive adventures on the continent. They, too, must not go scot-free.
A big chunk of the write-up is really a simplistic and uncritical regurgitation of boring, outmoded IMF and World Bank-inspired free market postulations bemoaning the size of African civil services and recommending the drastic downsizing of the public sector. If this overly theoretical and textbookish prescription hadn't already been discredited in many reputable intellectual and academic circles as a one-size-fits-all, I would spend some time on it. Perhaps Ayittey and other small government advocates can tell us how the innocent civil servants to be massively retrenched will be absorbed into other niches without further burdening the informal and traditional sectors, since the private sector is either non-existent or stagnant in most African countries. It seems that in the journey toward the neoclassical economic Holy Grail of small government, real humans and their economic fates are expendable.
Ayittey's most contentious postulation is his argument that "no amount of debt relief and increased aid will help Africa until Africa cleans up its own house." This would be a noble assertion were it not for the fallacy which inheres in it. How can Africa not be better off, even with all the corruption and waste, if it no longer has to pay the billions of dollars that it pays annually to service debts which were dubiously collected and which ended up for the most part in the West with the active collaboration of Western institutions and persons? In any case, the example of Nigeria, where the country has spent more than four times the amount of the original debt amount in servicing and interest payment and is still left with a rapidly appreciating principal, makes repayments of the foreign debts and the withholding of so-called debt relief immoral. Both Nigeria and her creditors know that this debt can never be repaid under the existing arrangements, which are actually designed to keep the principal unpaid while the creditors reap billions of dollars in annual servicing and interest payments. Nigeria's example is a microcosm of the African debt situation. Isn't it morally unacceptable for a country to continue to pay interests and service charges on dubious debts for which servicing payments alone have eclipsed the original debt amount? If only the Ayitteys of this world would temper their economics with some morality, they’d be able to grasp the moral dimension of this discourse of debt cancellation.
Let me therefore restate that I do not believe that debt relief is a charitable gesture on the part of the West; Western countries are merely trying, rather belatedly and half-heartedly, to make right what they messed up (by design) in Africa. The recent debt cancellation gesture is an incomplete atonement and a small restitution for the Western crime of willfully participating in questionable loan schemes and dubious monetary imports from Africa, which have left the continent comatose.
Nor do I subscribe to the notion of aid as aid or aid as charity. These aids—and they need to become completely free—are also token restitutive and compensatory payments deserved by Africa and Africans as a negligible material compensation, not for the slave trade and colonialism, as Ayittey insinuates, but for ONGOING devastation of the continent through the wanton extraction of the continent's resources by environmentally nonchalant Western companies, and the resultant destruction of the environment, livelihoods, lifestyles, not to mention the instigation and exacerbation of armed conflict and the massive repatriation of tax-free profits to Western capitals. No amount of aid will adequately compensate Africans for these Western schemes or atone for their amoral and immoral aftermaths.
It sounds good to call for a reform of African states and institutions as a prelude to increased aid and debt relief. Ayittey wants Africa to cleanse its own house before the West goes further with these new projects. But is this complete cleansing feasible or possible in Africa (or anywhere else) in the foreseeable future? Is this insistence on cleansing as a condition for aid in the interest of the suffering (and innocent) mass of Africans, some of who depend solely on foreign aid handouts for survival? Is this not tantamount to withholding food and medicine from a child until its parents "clean up their acts" and start being financially responsible?
Finally, Ayittey calls for smart aid, which he argues would bypass the "vampire state" and deliver help directly the Africans in the traditional and informal sectors through civil society organs. First, let me welcome Ayittey to the club of the realists—those who believe that needy Africans should not be starved of aid because their governments are corrupt, and that aid, especially of the non-soft loan variety, cannot be tied to slow or non-existent political and institutional reforms. I recall that when the moderator of USA/Africa dialogue posted a New York Times Editorial some months ago calling for the same kind of aid—aid which sidesteps corrupt state institutions and delivers help directly to those who need it— Ayittey was very vehement in his opposition to it. Since Ayittey himself is cynical and pessimistic about the prospects for the expansion of liberal reform on the continent, I wonder how he expects Africa "to clean its own house" and thus attract increased aid and debt relief."
In his response to the New York Times piece, Ayittey had argued that bypassing the vampire state with aid was a practical impossibility since the greedy state operatives would frustrate such a project. I would like to repeat this same criticism to him as an answer to his idea of channeling aid through civil society organizations. Since the African state is quite ubiquitous in terms of the exercise of power, the so-called smart aid will not work as state officials will resist and/or undermine this usurpation of what they consider their jurisdictional prerogative. It is illusory to expect that state bureaucrats will not pounce on or interfere with the implementation of such a smart aid package.
More importantly, the idea that civil society organizations and the informal sector are corruption-free and could thus serve as an accountable, efficient, and effective channel for aid distribution and implementation reveals a mindset that is hopelessly out of touch with African realities on the ground. It is founded on an overly theoretical insistence on separating African leaders from their people, the modern sector from the informal and traditional sectors. Such insistence on separateness ignores the symbiotic relationships between the public and private sectors of African political and economic life. These sectors, contrary to Ayittey’s argument, are separated by the thinnest and blurriest of lines. In fact, they are connected in a complex web of patron-client, familial, lineage, clan, ethnic, political, and socio-economic ties of mutual dependence and benefits.
My own knowledge, which is experientially rooted in Nigeria, reveals a more nuanced and variegated picture of corruption in which there are both private and public actors, in which there are actors from the so-called traditional and informal sectors and civil society. Corruption is not only rampant in the private and informal sectors of the Nigerian economy; the civil society organizations that Ayittey venerates are also very corrupt. In fact, the corruption in the Nigerian NGO and human rights communities, which no one talks about, is just as alarming as governmental graft. It is now so bad that human rights advocacy and NGO affairs have become autonomous domains of profit-oriented business and money-making. In this domain, the relationship between donors and recipient and partner organizations has an unsettling resemblance to that between so-called Western lenders and financial institutions on the one hand and African governments and leaders on the other.
So, what do we do?
Tony Blair's set of proposals, which actually falls short of the 100% debt cancellation (not forgiveness or relief) which many people of good conscience advocate, is a good place to start. It does not commit the error of simply throwing money at a bad situation. It marries the concerns of reform and the urgent need to save and improve lives on the continent. More importantly, it attempts to redress the anti-Africa trade practices of Western nations, who in effect have stifled African agricultural and proto-industrial production through their hypocritical subsidies and tariffs. My only disappointment with the plan (besides the failure to recommend the cancellation of all of Africa's debt) is the fact that its call for reform is one-sided. It does not demand the reform of Western financial institutions and global capital transfer practices, a reform which would make it difficult or impossible for corrupt African leaders to bilk the continent of aid money, which are then used to finance and lubricate investments and accounts overseas in a destructive cycle of corruption and hypocrisy.
Moses Ochonu, a US based Academic can be reached at ebe@nigeriavillagesquare.com
|
|
Last Updated (
Thursday, 24 April 2008 ) |
|
Authors 
Posted by Robot| 28.04.2008 02:22