Overseas Aid and Development

Part of Opposition Day – in the House of Commons at 4:43 pm on 22nd June 1994.

Alert me about debates like this

Photo of Mr Alastair Goodlad Mr Alastair Goodlad Minister of State (Foreign and Commonwealth Office) 4:43 pm, 22nd June 1994

Yes. On the Trinidad terms, we recognise the seriousness of the debt situation of the poorest, most indebted countries in Africa, which is reflected in the World bank report, and the need for the most generous levels of debt reduction, under the Trinidad terms, on a case-by-case basis. We shall continue to press our partners to take the same view. We regard it as important that multilateral debts are serviced to maintain the integrity of the institutions, but generous balance of payments aid to those countries pursuing economic reform is designed to permit such debt servicing, as well as meeting their import requirements.

I share the concern of my hon. Friend the Member for Stafford (Mr. Cash) about Uganda's heavy debt burden, but action on bilateral debt through the Paris Club will be the most effective way to tackle the problem. Full Trinidad terms—we would like Uganda to be one of the first beneficiaries if these are agreed—would release more money for multilateral debt servicing and other needs.

A critical issue is the ability to pay, and donors have been careful to ensure that Uganda has no balance of payments crisis. Altogether it received £244 million more in 1992 than it paid. This report is very flexible and can be used to service multilateral debt if Uganda so chooses.

Thirdly, developing countries need freer trade. Opening markets is probably the most important single thing that the developed world can do for developing countries as a whole and for the former eastern bloc. None worked harder than the UK in pushing for a succesful outcome to the GATT Uruguay round.

The Uruguay round presents opportunities to all countries and should be seen as a threat by no one. Certainly various studies have suggested that the benefits to developing countries will be unevenly spread. But the increased world prosperity which a successful Uruguay round will bring is good news for all the world and gives all countries the opportunity to benefit—provided they pursue the right mix of economic policies to enable them to do so.