G8 summit: What can it achieve?

The G8 Summit hopes to solve global challenges

A $1bn agreement to lighten the debt burden for the world's poorest countries has been passed at the G8 summit in Canada.

Paul Ladd, a senior economist for Christian Aid, answered your questions about the plan and the summit in a LIVE forum.

  Click here to watch the forum.  

Click here to read the transcript

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The debt relief proposal was supported by Canada, Britain and Germany, and is intended to free up repayment money for 22 African states to invest in healthcare and education instead.

Though loan repayments will be lowered, aid agencies are disappointed, saying the sum is only equal to 50 days of repayments and would not counterbalance price falls in coffee and cotton.

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Transcript

Newshost:
Hello and welcome to this BBC interactive forum. I'm Reeta Chakrabarti. African leaders have welcomed an action plan promising aid, debt relief, medical help and military intervention from the world's richest countries to the poorest. The leaders of the G8 nations signed an agreement with four African heads of state yesterday to promote economic and political developments which they said would herald a new dawn. South African president, Thabu Mbeki, who attended the summit described the plan as a very, very good beginning but said speed was needed to implement the decisions taken. In sharp contrast aid agencies denounced the summit as long on advice and short on help. Well you've been sending us lots of questions about the G8 and aid to Africa and here to answer some of them is Paul Ladd, senior economist at Christian Aid. Thank you for coming Paul.

We're going to start with a couple of people who both say that the G8 has given too little to Africa. The first is from Kirumira Mark who is sending her questions from Kampala in Uganda and they say: "I would like to know why the G8 has really ignored the poverty issue in Africa as regards the little money that has been advanced to it compared to the massive amount of money that was given to Russia for defence purposes by the United States of America?"

The second one from James Christchurch in New Zealand who says: "The billion dollar aid package is pitifully small and it comes with strings attached. The G8 countries and the United States in particular have demanded a more democratic Africa in return for aid yet these same nations continue their unwavering support for undemocratic regimes in Saudi Arabia, Pakistan, China and dozens of other countries." What do you say to them.

Paul Ladd:
I think I broadly agree with both of those. I think the financial response from the collective G8 has been quite weak. What we've seen is a commitment of an additional billion dollars for debt relief which is a top up, if you like, to the existing Cologne programme on debt relief which in 1997 promised $100 billion of debt relief to the world's poorest countries but has only delivered not very much of it. So we're seeing an extra one per cent topping up to that. What we also saw yesterday was a commitment to earmark, if you like, 6 billion of the 12 billion that the EU and the US committed to giving in extra aid at the Monterrey summit in March to Africa but that won't really kick in until 2006.

So we're seeing, on the one hand, 6 billion in extra aid and a little top up for debt. So let's compare that with some other numbers and see if it's a weak response or not. At the same summit, over the last two days, we've see the G8, or the G7, commit to Russia $2 billion a year for the next 10 years to decommission and safeguard nuclear materials, so that's already 20 billion. Each year the G8 spend about 350 billion on subsidies to farmers and farms in their own countries and next year the US military budget will about 370 billion. So I think if we put those in perspective I think we can argue that the response has been very weak from the G8.

Newshost:
Where has the main resistance come from because in Britain the Prime Minister, Tony Blair, has been very strong, certainly rhetorically, on how much he wants to help Africa?

Paul Ladd:
Well there clearly is a big difference of opinion within the G8. On the one hand you do have prime ministers and leaders who are willing to argue the case for Africa and even go out on a limb to do so and Tony Blair and Jean Chretien would be in that group. On the other hand you've got G8 leaders who are not committed that aid works and also have or what they perceive to be strong lobby groups at home which would argue against the effectiveness of aid and would say that the money is better spent at home. So there's a big difference within the G8 - the UK is among the more progressive, the US and Japan are among the least progressive but I think in some ways that's immaterial, you've got to hold the G8 up as a body that is collectively responsible for responding and in this case it hasn't.

Newshost:
Well we've got a series of e-mails entirely disagreeing with what you say and putting the blame fairly and squarely on the African countries themselves. One's from David Clancy in London who says: "Corruption is endemic amongst those governments in Africa, how can anyone be sure that aid is going to the right people and not ending up in a foreign bank account? Surely the onus is also on African leaders to do something for their people?"

One's from K Farrell in Dublin who says: "Some African leaders are power hungry dictators, we should insist that free and fair elections are carried out, if not then all cash should be withheld." And then another from Efe Miller who gives the address as being UK and also Turkey who says: "It's quite amazing that commentators and the public alike think Africa's problems could be cured with a magic wand. People think that if the debt is written off this would alleviate poverty, well it won't, governments would simply have a lot more money at their disposal to embezzle." What do you say to that?

Paul Ladd:
Well those are three questions all in the very interesting and very important area of governance. And some people would argue that the importance of this whole African initiative, stemming from African heads of state, is not really in some ways about resources. If you actually read the document the African leaders came less with the idea of getting aid, more with the idea of striking up a better partnership, a more mature political relationship with Western and Northern leaders. But at the same time they recognise that, especially post independence, there have been problems with both political and economic governance and what the African heads of states were proposing was to put their own house in order, if you like, in return for some forms of assistance in helping the continent to develop as whole.

Now when people argue that governments are corrupt then that's inevitably true for some African countries, especially over the last couple of decades, I think the point I'd like to make is that governance as an important issue is not equatable with government. I've spent most of my working life overseas and apart from the brilliant differences that I see between people what strikes me most is our similarities - we're all the same, we'd all like to get the most out of life, we'd all like to look after our families and increase our own welfare as much as we possibly can and we'd all like to keep our governments to account and there's a big difference between local groups who are outside of government and a corrupt government. And I think Christian Aid believes that one of the ways of strengthening democracy, in getting rid of corruption in a country, is to strengthen groups outside of government, so put the onus firmly on them to hold their own governments to account.

Newshost:
But how do you by-pass governments if you're going to give aid?

Paul Ladd:
Well you can - usual bilateral donors, say like DFID for the UK or Swedish Seed or whatever, usually have a bilateral relationship with a government, so they give government to government aid. In some cases though in conflict areas, at times of humanitarian need, or when government governance is perceived to be very bad there's no reason why DFID, for example, couldn't work more with local groups, more with civil society, to strengthen their side of the government's deal. But also, on the other hand, there are also charities, some of them based in Africa themselves, they're indigenous charities, alternatively charities like Christian Aid or Oxfam or the other sort of main international charities can play a role in strengthening local groups and getting them a bigger say in decision making.

Newshost:
Well we've got one e-mail from Brian Dickson in England who says: "Why should richer countries should help at all? Why is Bob Geldof sick of the G8?" Referring of course to the former rock star, who's done a lot of work in Africa. "Surely the G8 is sick of the continuous bailing out of Africa just as we, the ordinary taxpayers, are?" He says that he lived in South Africa for 18 years and can say that the continent is split by tribalism.

We've got another one on a similar theme from David in England who says: "All I'm hearing is how insignificant one billion is. I work for a living and some of this is taxpayers' money. I have no problem in helping out the poor but when they throw it back in our faces I'm tempted to tell them to shove off." Well strong words there. You might disagree with the fact that they're throwing it back in his face but the sentiment is clear isn't it, we should deal with our own problems and not those of a thousand miles away?

Paul Ladd:
Yes that's right. I mean I think I would just like to dispute the fact that they're not throwing it back in our face, I think African leaders are welcoming, as they say, the start of a process whereby they'll have a better relationship with the rest of the world. I think for me, as a person and as a staff member of Christian Aid and for many others in the UK, we find it morally offensive, if you like, to us that we tend to value lives in another part of the world less than we would value lives in the North or in the countries that we live. So that's one part of it.

Newshost:
It's surely a sense of frustration that one has been seeing these scenes and hearing these appeals for years and years and years and yet nothing much seems to change?

Paul Ladd:
Yes, I mean I think there's also, in some ways, a misperception about development and what we actually do commit to development. There was a survey about five or six years ago of the British public which asked them how much they think of UK tax money we actually spend on development and people thought we spent about 10 per cent of our gross national product when in actual fact at that time it was about a quarter of one per cent.

So there's a very, very real misunderstanding as to the actual commitment we do make to development issues first of all. And secondly when I read things about - that we've bailed Africa out many, many times before or we've helped them and it's all been money down into a black pit, all I would say is that I can't really remember very many times when we've actually bailed Africa out before. If people are pointing to, for example, the HIPC debt relief programme, most of that money hasn't turned up yet. And so we actually haven't fulfilled our promise of handing it over. I think the second important point to address, in some ways these e-mails, I think we've got to be a bit more long sighted, I think, about where we sit in the world and our independence with other people and on other people.

I don't think that over the next 50 to 100 years we're going to be able to maintain the same sort of fortress mentality that if we're ok in Britain we can collect and spend our own tax money on our own welfare but also leave other parts of the world in poverty and unguarded that that won't eventually affect us too. So I think we also have to take a long-sighted view about poverty in the world and equality in the world so that for our own benefit eventually as well.

Newshost:
We've got a couple of e-mails here which are agreeing with that general point. One from Jun Xu who's e-mailing from Canada and they say: "Aid can be very helpful in helping build infrastructure but it alone cannot solve the continent's problems. The decisive factors in Africa's development are freer trade with the West and better governance in Africa. The West shouldn't give money with one hand, i.e. aid, and take away opportunity with the other, i.e. trade barriers."

Then another one from Waq in London who says: "It often disgusts me how many of the privileged in this world believe they owe the Third World nothing. Take a look around you, the reason we all have such high standards of living is that there are vast numbers of people who live in poverty and provide cheap labour to produce our goods. Seriously, look at your clothes, at your children's clothes, at their toys, very few are made here and those that seem to be are often simply finished off and labelled in the West to produce a desirable 'Made in ...' label for snobs." So that's what you're referring to when you talk about us lot being able to live in this fortress mentality?

Paul Ladd:
That's part of it. I mean we're clearly linked much more than we used to be, through things like trade, but we're also linked by things like mobile phones and communication and internet and e-mail and flying - the ability to fly places much more quickly than we used to be. So let's look at trade first, because this is a really important component to this. I mean I'd agree entirely with the first e-mail that aid is in no way a magic wand or a magic bullet, it's only a small part of any response that we might have to poverty in the world. It's only going to go so far. It may be very good at investing in the long term things like health and education.

On the other hand I'd probably tend to disagree slightly in that the answer also lies mostly in freer trade and I think the second e-mail picks up on this. I think what many people in developing countries and many campaigners, like Christian Aid, are looking for is not freer trade but fairer trade and fairer in two ways. First of all the ability to have flexibility in trade policy if you're living in a developing country so that you can put the needs of your poor constituencies first, so that you can look after vulnerable groups because opening up markets is a big exercise in change and if the country does decide to go down that route then there are lots of costs associated with that. Some countries may not decide that that's the best policy for them either and they should be allowed to make that decision in a democratic way for themselves.

So first of all flexibility in domestic trade policy. And secondly there clearly is a huge hypocrisy in market access where we in the North encourage developing countries to open up their markets to our products which sometimes we subsidise so that's unfair competition, while at the same time we protect our markets by giving subsidies to our farmers and protecting our steel industry and many, many other examples too. So trade also is going to be a big part of the answer but it's not necessarily going to be in freer trade, it's going to be in fairer trade.

Newshost:
Alright if we can move on to the issue of debt relief. We've got one e-mail from Jason Forauer in Massachusetts in the USA who says: "Even though there is an almost fascist like fear against criticising the US government in this time of terror and war I must say that I'm ashamed of my country when it comes to dealing with Africa. Why has the US been the last country to discuss the idea of debt forgiveness?" And another one from Charles in Montreal who has the absolutely opposite view, he says: "At some point the African nations need to put away their collective begging caps and take some responsibility. Should I expect my bank to forgive my debts? Hardly." What about this first issue about why is it that the US government is so reluctant to discuss this idea of debt forgiveness?

Paul Ladd:
That is one of a number of issues where the US is less willing or able to be able to talk about committing to things in international fora, then they're much less willing than Jean Chretien or Tony Blair to make financial commitments or otherwise commitments in international arenas because they simply believe that their most important constituency is the one at home and they're the people they're going to look after. Now for me that's rather short-sighted because as I explained we just can't simply maintain this fortress mentality forever, we're going to have to realise that we live in a globally connected world and we've got responsibilities linked to that.

But similarly to aid, debt relief is only one small part of the answer as well, it's only one small part of the financing for development question if you like. Nevertheless, as I say, in 1997 $100 billion of debt relief was promised, very little of it has been delivered so it's an unresolved issue and we would like to see much more done on debt relief because debt is also important in the way it links to trade - developing countries often rely on exporting one or two key primary commodities and the prices of those have fallen a lot in recent years which affects their ability to pay back debt. So debt is still a big problem, it's not the answer to everything but it's still very important.

Newshost:
Right, well a hugely complicated area, there's so much to say but I'm afraid no more time to say it. That is all that we've got time for, thank you very much Paul Ladd for joining us and thank you to you all for sending in your questions. You can still join in the debate by logging on to www.bbc.co.uk/talkingpoint but for me, for now, goodbye.