Spotlight Letter about WDM Pamplet

30 August 2004

In your summer issue, Jenny Humphries, World Mission Advisor to the Diocese of Bath and Wells, asks if my opinion about the help given to Zambia by the IMF is changed by the recent World Development Report: “Zambia: Condemned to Debt – How the IMF and World Bank have undermined development.” The brief answer is, “Not much.”

The report is sixty-eight pages long so this is a compressed reply. The report attempts to show that Zambia’s poverty is due to interference by the IMF and World Bank. Considering that the IMF and World Bank, with others, provide 35% – 43% of Zambia’s budget, it seems odd to me that they should be accused of increasing Zambia’s poverty and undermining Zambia’s development.

One example given is the loss of Zambia’s textile industry due to the removal of tariffs allowing in cheap imports. The same loss occurred in the UK many years ago. A tragedy for textile workers, and more of a tragedy in Zambia than in Britain, but most people in Britain and in Zambia prefer the cheap imports.

A second example is the harm done to farming by the removal of subsides for fertilisers. Maybe so, but Xinhua, the Chinese News Agency, reports that in the 2002/2003 season Zambia had a bumper crop of 1.2 million tons of maize, and Zambia was able to export maize to DRC, Tanzania, Zimbabwe and Angola. According to the Zambian Agriculture Minister, the 2004 season is likely to be just as good.

Then, it is implied that poverty caused by IMF policies contributes to the HIV/AIDS epidemic. We read, “It is no coincidence that the HIV crisis has gone hand in hand with the debt crisis.” This, despite numerous investigations showing professional classes being more prone to HIV/AIDS than the poor, and Botswana, far wealthier per capita than Zambia, having a worse HIV/AIDS epidemic.

Finally, using the pamphlet’s figures for Real GDP, we see that between 1960 and 2000 national Real GDP has gone up 2.25 times. But population has gone up 3 times. This huge population change, a major cause of poverty, is hardly mentioned in the pamphlet.

When it is not misleading, there is much to be said for the debt campaign. The IMF and World Bank, and Gordon Brown, the Chair of the IMF Finance Committee, all applaud it. They are just as keen as campaigners to cancel “unrepayable debt”, but being more knowledgeable they see the difficulties. It is a complex problem and best left to these experts.

Amongst many things Zambia needs lots and lots of well-managed cash. Whilst the IMF experts try their best to provide the government with cash in hundred of millions of dollars, individuals can help by joining the Zambia Society Trust, which sees to it that our tens of pounds are well spent in helping the needy in Zambia.

Gerald Danaher

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