[Extensions of Remarks]
[Pages E1390-E1391]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

MEETING BLAIR'S G-8 AFRICA GOALS--PROGRESS, BUT FAR FROM FINISHED

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HON. CHARLES B. RANGEL

of new york

in the house of representatives

Tuesday, June 28, 2005

Mr. RANGEL. Mr. Speaker I rise to discuss the ongoing progress
towards meetings the objectives of Prime Minister Blair's G-8
objectives. The announcement of a tentative debt relief agreement for
certain developing countries, mostly in Africa, is an extremely
promising development for Africa that is long overdue. The recent
agreement on 100 percent debt relief will initially benefit 14 nations
in Africa, and is largely based on the Heavy Indebted Poor Country
(HIPC) Program, which already offers some debt relief to the world's
poorest nations.
Several countries not included in the initial package are still
technically eligible. An additional 9 African countries could qualify
for full debt cancellation in the next 12 to 18 months, and a further 9
countries in Africa may potentially benefit from the agreement sometime
in the future, if they continue to progress in meeting HIPC objectives,
such as tackling corruption. But these additional countries are by no
means guaranteed debt relief.
The current $40 billion debt relief package must be commended. It is
by far the most significant and comprehensive debt relief package ever
given to Africa. However, a recent article entitled ``Plan That Falls
Far Short of Global Needs'' in the publication CaribNews suggests that
the plan must be closely scrutinized. One glaring issue is that the
current package at most cancels only one-sixth of Africa's $295 billion
debt and leaves out several countries such as Nigeria and Kenya.
Nigeria, despite having a per capita GDP in line with HIPC eligible
countries, and a staggering $36 billion debt, is not currently included
in the deal, though G-8 representatives say that some type of Nigeria
specific arrangement is in the works. As a leader in West Africa, if
not the entire continent, its fate is closely linked to that of the
region. As such, the inclusion of Nigeria in a debt relief package is
crucial.
In addition to debt relief, the issue of increased assistance must be
addressed. This was reiterated in a recent Op-Ed release by Bernice
Powell Jackson, Executive Minister of the Justice and Witness
Ministries of the United Church of Christ, which calls on the U.S. to
do more to help Africa. President Bush has so far rejected Blair's call
to double aid to Africa, as well as establish the UN sanctioned
benchmark which calls on developed countries to devote 0.7 percent of
their gross national income to overseas development assistance by 2015.
Of the G8 countries, France, Germany, Italy and Britain, have all
pledged to hit the 0.7 percent target in the allotted period. The
European Union also a collective body has also agreed to the benchmark.

In 2004, the United States, the largest economy in the world, was
second to last among industrialized nations in the amount of
development assistance it gave as a percentage of Gross National
Income--it was dead last in 2003. In sheer volume the U.S. gives the
largest total amount of foreign development aid, but as a proportion of
national income only 0.16 percent goes to aid, far short of the 0.7
percent UN target.
While we claim to be the leader of the free world, small countries
such as Norway and Denmark dwarf us in the percentage of their national
income dedicated to development. Indeed, these countries have long
exceeded the 0.7 percent aid target that the U.S. has yet to adopt. In
addition, a recent report released by the Brookings Institute argues
that the extent of U.S. assistance in recent years is not as large as
the Administration has asserted.
Lastly, the issue of trade liberalization must be tackled if Africa
is to experience real and sustainable development. Africa has a
population of 860 million, accounting for 13.6 percent of the world's
population, yet it only accounts for only two percent of global trade
volume--down from 6 percent in the 1980's.
This is compounded by industrialized countries' usage of unfair
trading mechanisms, such as subsidies, which have prevented African
farmers and firms from competing on an equal footing with other
nations. While industrialized nations battle with each other over
increasing the $50 billion they give in annual development assistance,
they continue to spend over $300 billion on domestic agricultural
subsidies.
For its part, the U.S. gives billions of dollars annually in
subsidies to a very small group of largescale agricultural producers--
while compelling poor countries to further open up their markets. The
World Bank has estimated that an end to Western agricultural subsidies
would allow developing countries to earn hundreds of billions--on their
own. Concessions on trade may prove to be the hardest sell in Blair's
G-8 agenda, but his agenda is one the world cannot afford to ignore.

Helping the Least of These: Cancel Africa's Debt and Share the Wealth

(By Bernice Powell Jackson)

If you were only to read most of the newspaper headlines,
you'd think that the U.S. government is being quite generous
to the world's poorest continent, Africa, but it just ain't
so. In fact, we're being awfully stingy and while President
Bush is trying to put a happy face on his meetings with
British Prime Minister Tony Blair, Mr. Blair must be pretty
disappointed at how little he is coming away with for Africa.
The truth is that 34 of the world's 48 poorest nations are
in Africa, which is also facing a rampant AIDS epidemic,
where thousands die every day. Moreover, a number of African
nations are still recovering from civil wars and/or enormous
national debts, many of which were incurred by unscrupulous
dictators and illegitimate governments who never used the
funds for the hospitals and schools for which they were
intended. The truth is that Africa is a continent whose
natural resources of gold, diamonds, oil, chromium and other
much-needed minerals have been ravaged by much of the rest of
the world. Moreover, tens of millions of its most precious
resource--human beings--died or were stolen in the African
slave trade a century ago. I remember being on a World
Council of Churches panel in 1998 in Zimbabwe, where an
African leader reminded us that when you count the
billions of dollars lost to Africa through these ways,
``we don't owe Europe and America anything. You still owe
us,'' he said.
The truth is that for many of the poorest nations, paying
back these huge national debts is not only burdensome, it is
impossible. For most, they will never be able to pay off the
principle, while the interest costs continue to mount. But
many of these nations are forced to make these interest
payments, which means that they cannot put funds into health
care and education, which are critical to their national
survival.
Even the new World Bank President, Paul Wolfowitz; has said
that a case can be made for more funds going to development
in Africa. President Bush, however, doesn't seem to agree
with his protege, Mr. Wolfowitz. In his meetings with Prime
Minister Blair, President Bush has expressed an openness to
canceling debts, but he has refused to increase substantially
U.S. foreign aid to Africa. Instead, he has agreed to use
$674 million already allocated by Congress for emergency
famine relief to a few African countries.
The extra $25 billion a year for Africa sought by Mr.
Blair, are not budgeted President Bush replied. Nevermind
that almost the entire $220 billion allocated for the wars in
Iraq and Afghanistan have been unbudgeted by this same
administration.
Many Americans believe that we spend about 25 percent of
our Federal budget on foreign aid to poor nations when we
actually spend about 1 percent. Many Americans believe the
headlines when our government agrees to fund programs like
the $15 million announced for AIDS in Africa. The reality is
that little of that money has been sent. Similarly, three
years ago the U.S. signed onto the United Nation's Millennium
Project. In it, the world's riches nations agreed to
increase their aid to .7 percent by 2015 to the poorest
nations. Two weeks ago the European Union agreed to double
their aid by 2015. But, it seems the President Bush has
told Mr. Blair that we won't be doing the same. It's the
old story of the check is in the mail.
In a recent editorial, the New York Times pointed out that
.7 percent of the American economy would equal about $80
billion. That's roughly equivalent to the amount the

[[Page E1391]]

Senate approved for additional military spending in Iraq and
a little more than half of the corporate tax cut last year.
Three hundred million Africans live on less than $1 a day
on a continent trapped in $300 billion in foreign debt. If
we're serious about fighting the war on terrorism and serious
about living out the moral values we're so quick to talk
about, then we must not only cancel the debt of Africa's
poorest nations, but we must also substantially increase our
foreign aid to Africa.
You can write or call President Bush and tell him so. You
can write or call your Senator. You can ask others to join
you--it's up to us, all of us.
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Plan That Falls Far Short of Global Needs

Now that the euphoria of the G-8 debt deal to help poor
Africa, Caribbean and Latin American states has died down the
reality of the situation is hitting home.
And it is painfully obvious that what was initially sold as
a dream scheme isn't what it was cracked up to be.
Promoted as a plan designed to ease the financial pain of
high debt inflicted on some of the world's poorest countries
by the World Bank and the International Monetary Fund in
particular the $40 billion debt write off scheme approved by
many of the world's richest nations--the U.S., Britain,
France, Japan, Germany, Italy, Russia and Canada--falls very
short of what is really needed.
It's true that the deal is an important first step but it's
far from the generous package, which countries and
commentators would have us believe.
Some figures underscore the need for the industrialized
world to give more money to the designated beneficiaries and
also to expand the list of highly indebted nations, which are
crying out for help.
It's important that we bear in mind that when the figures,
which are being tossed around in a vain attempt to highlight
the generosity of the developed states, are looked at
carefully, the actual amount and how it is parceled out is a
drop in the bucket of requirements.
In today's money, according to Gary Duncan, Economics
Editor of the Times of London, the value of the recent write-
off is ``only about $17 million for the 18 countries to enjoy
immediately.''
Actually, as Duncan pointed out in well-reasoned analysis,
the amount that Tanzania, Guyana, Honduras and the other 15
beneficiaries would save in debt payment, which can then be
ploughed back into education, health, roads and
infrastructural development, is chicken feed. The relatively
small amount of $1.5 billion in annual savings ``is a
fraction of the $50 billion a year needed to double annual
aid flows,'' which Britain's Prime Minister, Tony Blair, and
his Chancellor of the Exchequer, Gordon Brown, insist is
needed to help Africa and other countries turn the corner by
reducing poverty.
It is estimated that Britain's commitment under the deal
calls for its taxpayers to provide $100 million a year for up
to a decade, a sum that the United Kingdom can meet without
breaking a sweat. The annual charge to the U.S. treasury is
close to $175 million a year. That's not enough to pay for
the public information system of the U.S. Justice Department.
For Germany the bill would amount to about $50 million a year
for the first three years. The sums get even smaller when we
look at France's annual commitment of about $30 million.
It's obvious, then that we are not talking about large sums
of money. Instead, the funds that don't even begin to scratch
the surface of need in Africa, the Caribbean and Latin
America. It's also clear that advocates of debt relief for
the world's poor were right when they called for a broader
debt relief and aid package.
For instance, Romilly Greenhill of Action Aid, raised
question marks about the scheme when he called the plan very
good short term news for the 18 countries that will benefit
but complained that overall ``it will do little to
immediately help millions in at least 40 countries that also
need 100 per cent debt relief. What is disappointing is the
lack of any substantial concrete commitment on aid.''
You can say that again.
What has hit home is that at a time when the United Nations
Millennium Goals are coming up for review, the United States,
the wealthiest of the wealthy, is unwisely opposing the
International Finance Facility which the British Chancellor
is seeking to establish to offer a greater helping hand to
the poor by using bonds to raise billions of dollars.
Washington's opposition is undermining efforts to boost aid
and in the end is likely to cause greater suffering.
To make matters worst, Germany has made it clear that it
doesn't intend to out up any new money to pay for the debt
write-off. Instead it will use existing aid funds to finance
its share of the deal, something that makes the whole thing
laughable. In essence, then, we shouldn't be expecting any
significant changes unless and until there is a substantial
change in attitude towards the poor.

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