International Development

Part of the debate – in the House of Commons at 5:04 pm on 1 July 1997.

Alert me about debates like this

Photo of Keith Vaz Keith Vaz Labour, Leicester East 5:04, 1 July 1997

I warmly welcome this debate. It is no exaggeration, even after the last speech, to say that it will be followed with enormous interest and hope around the world, especially in the poorest nations of Africa and elsewhere. Let us hope that we do not disappoint them.

The fact that room has been found in the crowded parliamentary timetable for a debate on international development, the day after the transfer of the sovereignty of Hong Kong and the day before the Government's first Budget, sends the strongest signal about the new emphasis and urgency given to these vital issues, in stark and refreshing contrast to the often Marie Antoinette-like indifference of the previous Administration. Special credit for that must go to my right hon. Friend the Secretary of State for International Development. I am delighted to have the opportunity once again to congratulate her warmly on her well-deserved appointment, and to commend her for the vigour, enthusiasm, dedication and skill that she has brought to her office. My right hon. Friend mentioned Dame Judith Hart, one of her illustrious predecessors. I believe that she has the capacity to exceed even Dame Judith's great achievements.

A series of recent international gatherings—the G8 summit in Denver, the Earth summit at the United Nations in New York, and the meeting of the Convention on International Trade in Endangered Species in the Zimbabwean capital Harare, to name but three—has served forcefully to remind us that, unless the problems of the world's poorest people are taken into account in all our deliberations, we cannot talk about peace and security in the world. Unless answers are found on the pressing issues of sustainable development, the future of our planet may be at stake. As President Robert Mugabe told the United Nations, the international community seems to remember the existence of Africa only when disaster strikes the continent. It was therefore welcome news when my right hon. Friend the Prime Minister announced at the Denver summit that we intend to increase our bilateral aid commitments to African countries for basic education, health care and the provision of safe drinking water by 50 per cent. compared with the figures for the past three years. Investment in both human development and infrastructure is essential if Africa is to be able to eradicate poverty and realise its full potential.

There are some hopeful signs. Despite what much of the media would generally have us believe, the news from Africa is by no means all bad. Many countries have undertaken serious reforms of their economies and systems of government. The absolute decline in incomes has been halted, and the 1996 average rate of growth for the continent was 5 per cent. Within that figure can be found some particularly impressive success stories.

Ethiopia, almost universally written off as a basket case a decade ago, has a growth rate of 12 per cent. Thanks to its encouragement of grass-roots democracy and the land reforms that have unleashed the creativity and enthusiasm of the peasantry, Ethiopia achieved self-sufficiency in food last year—a truly remarkable feat.

Uganda, another byword for tragedy not so long ago, had a growth rate of nearly 10 per cent. and has become a regional magnet for investment. This year, we acknowledge the fact that 25 years ago many of my constituents were expelled from Uganda by its hated regime. Many of them have re-formed links with their country of origin and will go back this year. Many regard with great pleasure the fact that Uganda has made such important strides.

South Africa has some of the highest rates of economic growth outside the east African region.

Despite such magnificent efforts, the difficulties and challenges remain extremely formidable. Sub-Saharan Africa has a population of 600 million, which will double by 2025. Forty per cent. of people live on less than $1 a day and the infant mortality rate is one in 10. Alongside conflicts, natural disasters and severe environmental difficulties, the AIDS pandemic continues to claim the lives of hundreds of thousands and to threaten millions more.

Against that background, Africa's share of world trade, output and investment—already disproportionately low—has declined steadily in the past two decades. All this has contributed to unsustainable levels of debt, a collapse of infrastructure, the revival of traditional conflicts and the eruption of new ones and, in certain instances, even the disintegration and disappearance of civil society and the states themselves.

It is scarcely surprising that even those Governments most committed to reform and self-improvement, such as Ghana, Uganda, Ethiopia and Mozambique, often find their way blocked by challenges that they find insurmountable. Therefore, the international community has a clear duty to make greater efforts to help Africa as it tries to solve its own problems.

Perhaps the greatest factor impeding Africa's efforts to shake off the legacy of poverty and underdevelopment is its chronic debt problem. I therefore welcome and applaud the Government's initiative to write off the bilateral aid debts of 17 of the poorest most indebted African countries. Equally welcome is the World bank and the International Monetary Fund's implementation of the heavily indebted poor countries—HIPC—initiative, which is likely to benefit up to 14 African countries, with Uganda as the first beneficiary.

We all know, however, that such measures on their own still fall far short of what is required. Debt servicing makes a mockery of our present aid programme. For every pound that Britain gives in aid, we receive back 47p in debt services. Not only is that morally reprehensible, but it clearly and directly undermines the effectiveness of our efforts in poverty reduction and development aid and is, therefore, economic nonsense.

The HIPC initiative only scratches at the surface of the problem. The level at which debts are considered sustainable has been set too high, and many countries are not scheduled to receive any relief until well into the next century. For many of their people, the stark fact is that that will come too late. Added to that, political problems are leading to further delays. Uganda is first in the queue, yet its relief package has already fallen a year behind schedule.

Debt relief, as I have already implied, is literally a matter of life and death. The United Nations Children's Fund has estimated that just £49 million of debt relief for Uganda could save the lives of 398,000 children under the age of five and 13,000 women who would have died in childbirth, in addition to improving primary education for 2 million more children.

Similarly, in Mozambique, debt servicing accounts for one third of public expenditure, while education gets just 7.9 per cent. and health a pitiful 3.3 per cent. The country's Ministry of Planning and Finance predicts that, even after HIPC relief comes on stream, debt service payments due in the next millennium will be three times their average in the early 1990s.

Mozambique is now a multi-party democracy. Its commitment to economic reform is such that a recent Financial Times supplement remarked that it would surely leave even Lady Thatcher breathless—quite an achievement. Among the reasons why Mozambique remains one of the poorest countries on earth, with one of the lowest life expectancies, are the sacrifices that it made to support the struggle against racist minority rule in the former Rhodesia, and the struggle against apartheid in South Africa. Its solidarity with the peoples of South Africa, Zimbabwe, Zambia, Namibia, Tanzania, Botswana and Swaziland was such that Mozambique became the first country to be admitted to the Commonwealth that was never colonised by Britain. Can it be right for a country that has already suffered so much to endure such a burden? There can be no moral, political or economic justification for that.

Likewise, what useful purpose or moral argument can there be for continuing to demand that the people of the Democratic Republic of the Congo pay the price for the extraordinary and bizarre behaviour of Mobutu and his henchmen? The Government have expressed a welcome wish to work constructively with the new Administration of Laurent Kabila in Kinshasa. There could be no better way to start than by giving bilateral debt relief and supporting such initiatives at the multilateral level. There is no doubt that such an approach will be welcomed throughout the continent.

South Africa's deputy Foreign Minister, Aziz Pahad, last week called for a co-ordinated international effort to help rebuild the Congo's shattered economy, which would have to start by working out ways to deal with the crippling debt burden of £9 billion inherited from Mobutu. He stressed that that must be an African-led initiative, and I believe that one of the most useful things that we could do is to encourage the increasing efforts of the African countries and peoples to resolve their problems themselves.

Such an approach has shown its worth in efforts to resolve conflicts in the Great Lakes region, to restore democracy and halt the slide to war in Burundi, and to end conflicts and restore democracy in Sierra Leone and Liberia. The continued progress of the Southern Africa Development Community and the more recent revival of institutionalised economic co-operation between Kenya, Uganda and Tanzania are the sort of positive examples that we need to support and help to build on.

It is entirely right that we should focus our efforts in debt relief and development aid on those countries that have made the greatest efforts to reform their economies and democratise their forms of government, on countries that fight corruption and do not contribute to instability among their neighbours and in the wider region. However, it is time to reject the tired and discredited dogma that economic liberalisation on its own represents some sort of panacea for the poorest countries of the world. The new Government elected by the British people in their millions on 1 May bring to the task of international development fresh thinking that asserts that liberalisation on its own is not enough. The state still has a key role to play in ensuring provision of basic health and education, in terms of physical infrastructure and in establishing a fair and transparent framework of legislation and regulation.

It is interesting to note that, as with the Government's policies at home, our thinking on international development is paralleled by a welcome change of heart on the part of key players, some of whom have by no means always shared our views and perspectives. For example, last week the World bank's chief economist, Joseph Stiglitz, declared: Markets and governments are complementary. The state is essential for putting in place the appropriate institutional foundations for markets. According to the World bank's new report "The State in a Changing World", most African countries will need to raise real public wages, increase spending on social services and undertake vast investment in personnel management, retraining and accountability. The bank's president, James Wolfensohn, noted: Without an effective state, sustainable development, both economic and social, is impossible. According to Wolfensohn, the state must be a "partner, catalyst and facilitator" of economic development, setting rules to allow markets to function, playing by the rules itself, acting predictably and preventing corruption.

The World bank report identifies what it considers as five crucial functions that Governments, as opposed to markets or the private sector, must provide—a legal foundation, an effective macro-economic policy environment, investment in basic social services and infrastructure, a comprehensive safety net for vulnerable members of society and basic environmental protection. For those who remember the dogmas, prescriptions and impositions of the 1980s in particular, those are welcome and refreshing words. They provide the basis for a great new consensus which can really work to eliminate extreme poverty and so make the world a safer and more sustainable home for future generations.

I know that my right hon. Friend the Secretary of State brings to her office an awareness of the tragic circumstances that led to some of her forebears having to leave Ireland and subsequently make their home in Birmingham. In his recent message at the famine commemoration event in the Irish Republic, my right hon. Friend the Prime Minister recalled and regretted how the Government of the day in London 150 years ago failed a section of their people, with tragic consequences, by allowing political and economic dogma to take precedence over human want and need.

Today, we live in an even more interdependent world; we must not leave to future generations the burden of having to say that we in this House failed the most needy people in the world for any reason of prejudice, indifference, dogmatism or wilful neglect. That, above all, is what the Government's White Paper must address; I firmly hope that it will.