debt and poverty saape – katmandu – 10 january 2009 eric toussaint president cadtm belgium ...
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Debt and Poverty SAAPE – Katmandu – 10 January
2009
Eric Toussaint President CADTM Belgium
www.cadtm.org www.oid-ido.org
Contact: [email protected]
Change in total debt stock compared with the total net transfer on the public external debts in South Asia
Comparaison entre l’évolution du stock total et les transferts nets sur la dette extérieure publique de l’Asie du Sud
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Transferts dette publique et publiquement garantie Stock total dette PPG
World Bank discovered suddenly 400 more million poverty-ridden people
In September 2008, the World Bank acknowledged that there were major errors in its calculations concerning the poverty situation worldwide[1]. In fact, while « estimates of poverty established by the World Bank are improving thanks to more reliable data about the cost of living », the result is in itself a brutal challenge to the statistics produced by an institution that has been going through a serious legitimacy crisis for several years: suddenly the World Bank has discovered that « 400 million more people than previously estimated live in poverty ». That’s more than half the population of Sub-Saharan Africa!
[1] See http://go.worldbank.org/MLVZFZTMS0
According to its information release, “1.4 billion people in the developing world (1 in 4) were subsisting on less than 1.25 dollars a day in 2005”, whereas previous estimates were around 1 billion people. With errors like this in World Bank poverty calculations, the whole edifice of current international anti-poverty policies falls apart.
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
World Banks Statistics on Poverty (Source: Chen et Ravallion, 2008)
Structural Adjustement policies
What are the short-term or shock measures imposed by Structural Adjustment, and what are their consequences?
The end of subsidies on products and services of primary necessity: bread, milk, rice, sugar, fuel, electricity
A drastic reduction in social expenditure.
Devaluation of local currency High interest rates
What are the long-term or structural measures imposed by Structural Adjustment, and what are their
consequences? The development of exports The complete opening up of markets through
elimination of customs barriers The liberalization of the economy, especially
the abolition of capital movement control and exchange control.
A system of taxation which further aggravates inequalities, with the principle of value-added tax (VAT) and the protection of capital revenues.
Massive privatization of public companies and subsequent retreat of the state from competitive sectors of production
Joseph Stiglitz, Globalization and its Discontents
«Most of the advanced industrial countries - including the USA and Japan - had built up their economies by wisely and selectively protecting some of their industries until they were strong enough to compete with foreign companies. (…) Forcing a developing country to open itself up to imported products that would compete with those produced by certain of its industries, industries that were dangerously vulnerable to competition from much stronger counterpart industries in other countries, can have disastrous consequences - socially and economically. Jobs have systematically been destroyed - poor farmers in developing countries simply could not compete with the highly subsidized goods from Europe and America - before the countries' agricultural and industrial sectors were able to grow strong and create new jobs. Even worse, the IMF's insistence on developing countries maintaining tight monetary policies has led to interest rates that would make job creation impossible even in the best of circumstances..»
United Nations, Report by the Independent Expert, Mr. Fantu Cheru “Structural adjustment goes beyond the
simple imposition of a set of macroeconomic policies at the domestic level. It represents a political project, a conscious strategy of social transformation at the global level, primarily to make the world safe for transnational corporations. In short, structural adjustment programmes (SAPs) serve as “a transmission-belt” to facilitate the process of globalisation, through liberalisation, deregulation, and reducing the role of the State in national development.”
UN-HRC Effects of Structural Adjustment Policies on the Full Enjoyment of Human Rights, submitted in accordance with Commission decisions 1998/102 and 1997/103 E/CN.4/1999/50
Food Crisis: 2007-2008 According to the United Nations Food and Agriculture
Organization (FAO)[1], 848 million people were suffering from hunger between 2003 and 2005, a figure comparable to that of 842 million between 1990 and 1992. But the situation has deteriorated seriously due to the explosion in food prices and in September 2008 the FAO revised its estimate upwards, judging the trends to be “worrisome”[2]: 923 million people were undernourished in 2007, including 907 million in the developing world. Of these, 583 million were living in Asia, 273 million in Africa and the Middle East and 51 million in Latin America. In December 2008, FAO estimated than the number of undernourished persons increased 40 million in 2008.
[1] FAO, “Briefing paper: Hunger on the rise”, http://www.fao.org/newsroom/common/ecg/1000923/fr/hungerfigs.pdf
[2] FAO, “ Hunger on the rise. Soaring prices add 75 million people to global hunger rolls”, Press release, 18 September 2008.
“The idea that developing countries should feed themselves is an
anachronism from a bygone era. They could better ensure their food security
by relying on the US agricultural products, which are available in most
cases at lower cost.” John Block, US Agriculture
Secretary, 1986
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ODA M igrantsRemittances
Repatriated P rofitsby M ultinationals
Servicing of publicexternal debt
Com parison of different financial transfers for the DC in 2007