Issue No 6Friday 24 July 1998
The Official Newspaper of the
Lambeth Conference

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Front page of this issue

Caught in the debt trap
by Nicola Currie

"Why are we suffering so much?" asked an old woman who lives in poverty in
rural Zambia. "Because of the IMF," came the reply. "Well, who is this Mr IMF who makes us suffer so much?" she retorted.

Bishop Bernard Malango (Northern Zambia) uses this story to illustrate how the rural poor know about the daily misery of living with the consequences of the Structural Adjustment Programmes (SAPs) imposed by the IMF and World Bank, even if the bodies themselves are unknown to them.

In 1991 a SAP was imposed on the country. Essential commodities were no longer subsidised, free education ended, people had to pay for medical care, and the dramatic rise in fuel costs led to further price increases.

Zambia, like many countries, is caught in the debt trap. The government needs grants from these bodies to pay back earlier loans. Today many of the rural poor are lucky if they have one meal a day. The extended family system that ensured the welfare of all the community is breaking down as people struggle to survive. It is estimated that every child born in Zambia today inherits a debt of £450.

One result of this debt is the rise in the number of street children who come to the cities to beg. Bishop Malango's diocese has set up a feeding programme for these children, some of whom are as young as 5. But such programmes do not address the cause of the problem. Bishop Malango calls for a fresh beginning: cancellation of the debt so that people in Zambia have breathing space.

Still paying for the shoes of Imelda Marcos
"We are not asking for debt forgiveness; we are asking for justice. We are asking the creditors to repent, and debt cancellation would be a symbol of that repentance," says Archbishop Alberto Ramento of the Philippine Episcopal Church.

The government of the Philippines has to allow an automatic allocation of 40 per cent of its annual budget to service its debt burden of $46 billion. Archbishop Ramento says the IMF and World Bank knew of the corruption of the Marcos regime, yet they continued to give loans. The Marcos regime has ended but its inheritance is still with the people. "We are paying for the shoes of Imelda Marcos," Archbishop Ramento says.

To the ordinary people of the Philippines this indebtedness means "huge amount of money are allocated to servicing the debts. Money and resources that could have been used for education, health and social services to alleviate the desperate conditions of our poor peasants are being siphoned off to pay the debts. "This means that more and more foreign currency will be needed to pay off debts-foreign currency that can come only from remittances of our exploited migrant workers abroad, now numbering seven million, and from tourism which has encouraged the growth of the sex industry."

Archbishop Ramento says this sex industry includes the exploitation of children by paedophiles posing as tourists. "We are fighting a war in third world countries.We are fighting to live with dignity and we cannot win this war because we do not have the power to win it on the streets of Manila alone. But it can be won in the streets of London and Washington by those who have the power."

Need for a new economic order
"Debt cancellation will not change anything long term; there is a need for a new economic order," says Bishop Luiz Prado (Pelotas, Brazil). Debt cancellation by itself will not change the underlying unjust global structures which he believes need to be changed for people to become fully human.

The city of Pelotas has a population of 350,000, of whom 20 per cent live in misery, barely surviving at all. But Bishop Prado maintains that debt is not a simple North/South issue.

"There are people in our country who live as people in the North. They are not interested in change, so they support the World Bank and IMF and share their priorities. But their priorities are not ours. Our condition is a by-product of the development of others at our cost. We see in horror the fruits of our work being used just to pay the interest on the debt."

"Our natural resources are exploited in ways that degrade the quality of the environment, with the same technology that is forbidden in its countries of origin. In our situation our commitment is to the encouragement of those who live in such horrible deprivation. We try to translate our faith and vision into political engagement with people."

So the Church in Brazil is active in working with the National Movement of Landless People, a political grouping of the poorest in society. "They have a very clear picture of the social mechanisms that produce injustice and misery," Bishop Prado says.

"They also are the ones who outline in the most intelligent way the political alternatives to the underdevelopment and rupture with international dependence. The Landless people, as a movement, are a great example to the Christian Churches."

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