The issue of the global debt crisis–and particularly the onerous debt levels of developing world (“Southern”) countries–was a topic that we covered in POLI 1100 today. It will allow me to combine two class topics–issues pertaining development and underdevelopment, and interest groups (NGOs)–into one blog post. The interest group, Global Issues, is dedicated to analyzing “social, political, economic, and environmental issues that affect us all” and has a section on debt relief for the developing world. Here are some facts and figures related to the scale of the debt crisis in the developing world:
Consider the following:
- In 1970, the world’s poorest countries (roughly 60 countries classified as low-income by the World Bank), owed $25 billion in debt.
- By 2002, this was $523 billion
- For Africa,
- In 1970, it was just under $11 billion
- By 2002, that was over half, to $295 billion
- Debts owed to the multilateral institutions such as the IMF and World Bank is currently around $153 billion
- For the poorest countries debts to multilateral institutions is around $70 billion.
$550 billion has been paid in both principal and interest over the last three decades, on $540bn of loans, and yet there is still a $523 billion dollar debt burden.
Here are some remarks by Professor Susan George on how to tackle the debt crisis. Money quote:
…there is no level of human suffering, which in and of itself, is going to change policy. The only way policy changes is because people demand it, and in this case, it has to be the people of the North, because the people of the South have very little political clout.