African nations are not solely to blame for poverty

One of the world’s great heroes, Nelson Mandela, told a crowd in London ahead of the G8 meeting in July that “while poverty persists, there is no true freedom”.

If the response to the global Make Poverty History campaign and Live 8 concerts is anything to go by, it would seem that millions are beginning to agree with him.

People are not prepared to continue to live in a world where the richest three people are wealthier than the poorest 48 nations. They don’t want to live in a world where poverty kills 30,000 children each day and where 2.7 billion people struggle to exist on less than $US2 a day.

Yet many commentators in the world’s richest countries are quick to dismiss the groundswell of support for tackling global poverty as naïve and ultimately counterproductive. Often they suggest that poverty in developing countries is not a shared problem that the global north and south must take on together, but one that is essentially of the poorest countries’ own making.

Corrupt leaders of developing country and fat aid bureaucracies are accused of wasting the majority of aid dollars spent by donors in the past 40 years, largely using it to line their own pockets. We are told poverty would not exist if it weren’t for corruption, and poverty will only be fixed when developing countries’ governments eliminate corruption. More aid and debt relief, in the interim, would only fill more Swiss bank accounts and buy fleets of Mercedes.

There is no doubt that foreign aid has too often been given to the wrong people for the wrong reasons. Aid has been wasted by donors and recipients and corruption remains a significant problem.

But developing countries and their governments hardly have a global monopoly on corruption.

For example, WorldCom boss Bernard Ebbers was sentenced recently to 25 years in prison for his part in corruption involving an $US11 billion accounting fraud which bankrupted the $US200 billion company, eliminated millions of dollars in US pension funds and put thousands of Americans out of work. Yet few people are clamouring for US corporations to be denied further taxpayer funded assistance until they can demonstrate they are corruption-free.

The reasons for the persistence of poverty in developing countries are complex. They include substantial historical handicaps such as colonialism, slavery and Cold War politics, war and conflict, chronic under funding of important programs to combat hunger and disease and to fund basic services. Further reasons include the impact of blunt and inflexible World Bank and IMF policies and waste due to mismanagement or corruption.

Aid and debt relief can work, however, and well-targeted aid can and is being used to fight corruption and promote good governance. In Malawi, Oxfam has funded groups which tour the country’s schools making sure textbooks and other educational materials paid for by foreign aid actually arrive. In Kenya, a national government anti-corruption campaign reduced the incidence of bribery by 25 per cent over 2 years.

Aid can increase developing countries’ capacity to monitor spending and can ensure public servants are paid a salary on which they can survive, minimising the motivation to accept bribes. It can help build institutions, such as the judiciary, capable of tracking and tackling corruption. It can foster features of a civil society, including media, to improve public scrutiny.

Developed countries can also do their part to assist in the fight against corruption by ratifying the UN Convention on Corruption and by improving the transparency around corporate and government payments to developing countries through schemes such as Publish What You Pay and the Extractive Industries Transparency Initiative. These actions would minimise the scope for investment dollars or donor revenues to be siphoned off.

But just as poverty is not caused by corruption alone, it cannot be eradicated purely by tackling corruption and governance issues. This is the reason why the Make Poverty History campaign is calling for all countries, including Australia, to do their fair share to eliminate the global injustice of poverty, through more and better aid, debt relief and fairer trade.

While incomes in the world’s richest countries have doubled since 1960, rich governments’ spending on aid has not kept pace with their incomes. The recent G8 decision to boost aid by $US48 billion by 2010, forgive the debt of 18 of the world’s poorest countries and achieve universal access to HIV-AIDS treatment by 2010 was an important first step towards reversing this trend, but there is so much more to be done.

Five years ago, more than 190 countries formulated a global plan to halve poverty by 2015. They agreed to a set of development targets known as Millennium Development Goals (MDGs). The MDGs included the achievement of universal primary school education, a reduction in the child mortality rate by two-thirds, a reduction in the maternal mortality by three-quarters and halting the spread of HIV-AIDS, malaria and other diseases.

But most countries, even after increasing their aid commitments in recent years, are falling well short of meeting a key part of that agreement - giving only 0.7 per cent of gross national income (GNI) in aid each year. The average among developed countries is just 0.41 per cent of GNI. Australia is among the poorer performers giving just 0.28 per cent of GNI.

Concurrently, developing countries are expected to repay debt - which was often incurred by leaders they did not elect and before most of each country’s population was born - at a rate that easily outstrips aid payments.

Poorer countries are also asked to participate in a global trade system that is stacked heavily against them. Developed countries now spend more than $US300 billion each year on subsidies for their farmers - the equivalent of the entire combined income of Africa.

World leaders, including Australian Prime Minister John Howard, must take up the historic opportunity of September’s UN Millennium Summit progress meeting in New York to immediately increase aid to the poorest countries in the world so they can achieve the MDGs. This is especially the case for Australia, as it is one of few countries among the 22 OECD developed countries that is yet to make a substantial new aid commitment to meet the MDGs.

The Make Poverty History campaign urges Australia to commit to lifting its aid to 0.5 per cent of GNI within four years, as a first step towards meeting the 0.7 per cent UN target. To put this in perspective, this is the equivalent of each Australian spending an extra 27 cents a day on aid.

Australia must also join international efforts to secure 100 per cent debt cancellation for the 60 poorest and most heavily-indebted countries.

Also, this year presents an opportunity for reform of international trade rules at the WTO ministerial meeting in Hong Kong in December. As an agricultural producer, Australia has long been a champion of trade reform including the removal of hefty European, Japanese and American farm subsidies.

Australia can continue to take the lead in December by pursuing a rapid phase-out of export subsidies that encourage dumping of agricultural products on world markets at less than cost prices. Additionally, developing countries must be allowed to decide the pace and extent of trade liberalisation of their agricultural markets to ensure billions of small-scale farmers can feed themselves.

As United Nations Development Programme economist Jan Vandermoortele suggested in a paper published earlier this year, “ambition is golden”, when it comes to achieving the MDGs and eradicating poverty. “It is pessimism, scepticism and cynicism that are the three worst enemies of the global anti-poverty agenda,” he said.

Make Poverty History is about ensuring that 2005 is the year that we all rise to the challenge to end poverty.