First, when I say 'we', I mean the money landers and people behind the IMF - US, Canada and europe mainly.
Now, Bono's been a long time proponent of this, and after taking world issues and studying 3rd world countries and their problems, I have to agree with him. I think we should forgive 3rd world counties of any money they owe us. Most of these counties cannot even afford to keep up with their interest payments, let alone their principle. I believe this was the cause behind Argentina's turmoil too. These counties can never hope to repay the debt and they always ask for more and it never helps.
Also, we owe our current status partially to these counties, since most of them are former colonies.
This however brings up a problem. If we let them keep all that money, what happens the next time they ask us for more? Will they expect us to forget about their debt again and again and again? For obvious reasons, that shouldn't happen.
Most of the projects funded by the IMF have been failures, and its not uncommon to have the governments spend aid money on arms etc.
As one example, during the 70s CIDA (canadian international development agency) helped fund a large bakery in Tanzania. This was designed to sell canadian goods and even hurt Tanzania. Wheat is not a native product of Tanzania, so they had to buy wheat from Canada. Also, the large bakery put smaller ones out of business and in the end caused more unemployment.
Another example, the IMF often forces countries to produce a 'cash-crop', whos price fluctuates and does not provide much money or livelyhood to nations, which are then forced to buy food from...the canadian, us praries!
What we need is a new type of agency that does not not act like a bank, but as a donation agency. Counties would get much less money, but projects must be planned as and executed as to insure that the project will be profitable and will ensure sustainable development in that country. Also, these projects should be handled directly by the agency, not by 3rd world governments who might divert the funds.
Conclusion: These counties are drowning in debt, we will probably never see any of the money we lend at the current rate, and I think its time things changed.
Now, Bono's been a long time proponent of this, and after taking world issues and studying 3rd world countries and their problems, I have to agree with him. I think we should forgive 3rd world counties of any money they owe us. Most of these counties cannot even afford to keep up with their interest payments, let alone their principle. I believe this was the cause behind Argentina's turmoil too. These counties can never hope to repay the debt and they always ask for more and it never helps.
Also, we owe our current status partially to these counties, since most of them are former colonies.
This however brings up a problem. If we let them keep all that money, what happens the next time they ask us for more? Will they expect us to forget about their debt again and again and again? For obvious reasons, that shouldn't happen.
Most of the projects funded by the IMF have been failures, and its not uncommon to have the governments spend aid money on arms etc.
As one example, during the 70s CIDA (canadian international development agency) helped fund a large bakery in Tanzania. This was designed to sell canadian goods and even hurt Tanzania. Wheat is not a native product of Tanzania, so they had to buy wheat from Canada. Also, the large bakery put smaller ones out of business and in the end caused more unemployment.
Another example, the IMF often forces countries to produce a 'cash-crop', whos price fluctuates and does not provide much money or livelyhood to nations, which are then forced to buy food from...the canadian, us praries!
What we need is a new type of agency that does not not act like a bank, but as a donation agency. Counties would get much less money, but projects must be planned as and executed as to insure that the project will be profitable and will ensure sustainable development in that country. Also, these projects should be handled directly by the agency, not by 3rd world governments who might divert the funds.
Conclusion: These counties are drowning in debt, we will probably never see any of the money we lend at the current rate, and I think its time things changed.
Facebook
Twitter