This weekend tens of thousands of people will join hands around world leaders in Birmingham at the G8 summit to demand debt relief for the year 2000. In the run up to this action, FIONA FOX, from Cafod, met Pixel van Trotsenburg, a leading debt specialist at the World Bank
AmXEL VAN Trotsenburg is an eminently likeable an. As the leading official at the World Bank working on HIPC, the Heavily Indebted Poor Countries Initiative, this man eats drinks and sleeps debt relief and makes decisions on a daily basis which affect the lives of millions of the poorest people in the world.
Axel's rather flamboyant dress sense jars with the imposing surroundings of the World Bank's Washington HQ and the grey men who predominate. With his green check jacket, red tie and multi-coloured cufflinks, Axel couldn't be more charming. Axel disarms his critics with his passionate .defence of HIPC and his respect for the concerns of aid agencies.
But while his style is engaging and all his critics admit to a sneaking regard, Axel is ever the official. With his perfect English, this Dutchman churns out statistics like a calculator and speaks a strange alien language that only debt experts understand. All attempts to get to the real man behind the funny language are quickly rebuffed. Suspecting that the multi-coloured cufflinks are signs of a woman's touch, I question him about his family. With what seems like a pre-prepared joke, Axel reveals that he is involved in serious debt negotiations with his young daughter to whom he owes large amounts of quality time.
Sorting out Third World debt HIPCstyle is a timeconsuming business. Beyond that I get nothing HIPC is the latest in a string of attempts to tackle the chronic Third World debt crisis which has left many of the world's poorest countries unable to fund development because of crippling debt repayments.
Announced in 1996 by the World Bank and IMF, HIPC was welcomed by aid agencies like CAFOD as the first initiative to allow for the cancellation rather than rescheduling of some unpayable debts. It was also praised for bringing together all the different debts owed by poor countries into one comprehensive initiative (i.e. debts owed to governments, commercial banks and lending institutions like the World Bank and IMF).
Two years on, what was hailed by World Bank President Jim Wolfensohn as a "robust exit from debt" and "good news for the poor" is being attacked by aid agencies as too slow and too mean. Only Uganda has received any debt relief and other countries like Mozambique, look set to be paying more debts after they've been HIPCed than before.
But Axel van Trotsenburg is angered by these constant criticisms. He insists that the very existence of HIPC is a breakthrough: "The World -Bank and IMF have created an initiative which is unanimously supported by 180 governments what other initiative commands that level of support?" Axel is also at pains to prove that within the Bank and the Fund this initiative is seen as a priority: "Since we started with HIPC, our Board has met 30 times to discuss this this is every three weeks that is a high level of commitment."
One of the most damning criticisms from aid agencies is that the amount of debt relief on offer is so small that many countries will be left with massive debts even after HIPC. The agencies argue that if countries have to continue to divert resources from health and education to pay off debts, then HIPC has done nothing to reduce poverty. Axel implicitly acknowledges this and implies that HIPC was never meant to be a one-off solution to world poverty.
His response reveals the schism between the World Bank view of debt relief and that of aid agencies who believe that significant debt relief could pave the way for the kind of development which would free poor countries from dependence on official aid and charity: "HIPC is not an end in itself. We want to attack poverty from all sides.
'What the World Bank has always said is that we recognise that in some countries, the debt problem is so bad that they need additional help on top of debt relief. For example, the World Bank is not just giving debt relief to Mozambique, we are also supporting post war reconstruction there with billions of dollars worth of grants."
Axel shows his first signs of serious irritation at my questioning when I ask him whether aid agencies have been naive to think that poverty reduction would be at the centre of any debt relief deal drawn up by the World Bank and IMF.
Given that African governments were only able to pay 57% of their scheduled debt repayments in 1995, maybe, I suggest, HIPC is just a new way of getting the money back: "Look we have the same concerns as NGOs and Church groups. Our starting point is the need to reduce poverty in the developing world. Reducing debt is one way of doing that and we know that Uganda, who have just received $340 million debt relief will use that money to fund a new scheme to provide all children with primary education."
Axel argues with a conviction that assures me that he believes what he says. But there is convincing evidence that others in the Bank and Fund view HIPC in a rather different way. Addressing journalists before President Clinton's recent visit to Africa, Jean-Louis Sarbib, the World Bank's Vice President for Africa, described his view of HIPC: "It's not really about wiping off the debt...It's just making sure that these countries can remain good credit risks....The idea of HIPC is in fact to allow you to continue to be a good financial citizen of the world community."
Ina briefing on HIPC produced by the IMF's external relations department, poverty reduction is not mentioned once.The other down side of HIPC from the point of view of agencies like CAFOD is the insistence that countries follow IMF designed economic reform policies before qualifying for debt relief. Under HIPC, poor countries must stick to these Structural Adjustment Policies (SAPs) for 6 years before qualifying for debt relief. Those countries who fail to stick to them are declared "off track" and the 6 year clock must be started again from zero.
Tanzania is one example. A country with massive debts, the government is currently spending nine times more on debt repayments than on basic health care. Not surprisingly 40% of the population die before the age of 35. Yet Tanzania will have to wait until 2002 to get debt relief under HIPC because it went off track.
The other reason it's sometimes hard to believe that HIPC is driven by an antipoverty agenda is that the economic reforms imposed under HIPC are responsible for exacerbating poverty in the Third World. A CAFOD project set up to monitor SAPs in Zambia, where 80% of the population live in poverty, has shown that these policies have reduced life expectancy from 50 to 40 and increased infant mortality. One in five children in Zambia do not make it to their fifth birthday.
Given these concerns around HIPC, it is not surprising that the campaign for a more generous cancellation of debts by the millennium has started to gain popular support. Under the umbrella of the Jubilee 2000 coalition, agencies like CAFOD and Christian Aid have mobilised their supporters to take a variety of actions in support of using the millennium to have a one-off cancellation of unpayable debts, Far from welcoming this kind of public support for debt relief Axel van Trotsenburg is angered by the whole Jubilee 2000 campaign. Despite my best efforts to persuade him that this level of public pressure can only help push some of the more reluctant creditor governments to have a greater commitment to HIPC, Axel seems personally wounded by the campaign: "Jubilee 2000 is not a credible campaign. We have been begging them to define unpayable debt and they can't even do that. They don't specify who should benefit, which criteria should be used. I would say to them Do you support HIPC, because HIPC is delivering debt relief now."
Axel is on a roll, clearly irritated: "Basically, Jubilee 2000 has a vague concept while HIPC is an initiative with the support of 180 governments and a framework for delivery It lacks legitimacy it is Jubilee 2000's obligation to come forward with a realistic framework. All they are doing is raising false expectations."
I finish my interview by asking Axel if he has any dreams for the millennium. He hesitates and for one second I think I might have reached the human being rather than the debt specialist, "A spectacular announcement on debt would be nice," he says. But as soon as I suggest that is exactly what Jubilee 2000 is pushing for, he leaps back into HIPC mode. "That level of synchronisation amongst governments is impossible. My dream is to see the implementation of HIPC and see it delivering the goal of sustainable debt."
The entire cost of debt relief for over 20 of the world's poorest countries under HIPC is $7.4 billion,
less than the cost of one stealth bomber. Yet even persuading rich countries to commit this amount of money is proving a struggle. When the markets collapsed in Asia, the IMF mobilised a rescue package of over $100 billion in a matter of months.
AID AGENCIES and church networks believe that the
Jubilee 2000 campaign is absolutely essential to create the political will to make any international debt relief initiative a success. Mulima Akapelwa is the coordinator of the CAFOD debt project in Zambia. She is in the UK to take part in the human chain in Birmingham this weekend. When asked by a journalist if she could sum up the human cost of debt, she replied: "My image of debt is of meeting a family with an 8 month old child who became sick.
It took them three days to gather together the money needed to pay for medical fees and two days to walk to the clinic.
As they arrived the child died in its father's arms. All these factors the family's lack of income, the introduction of medical fees and the state of the roads can be traced back to debt."
Axel van Trotsenburg quips that you need a good dose of idealism to work at the World Bank. As nice as he is, you can't help but wish he had a little more of it.