§ 28. Mr. CorbynTo ask the Secretary of State for Foreign and Commonwealth Affairs what examination he has made of the effects of structural adjustment programmes on the economies of central America and the role of the British aid programme. [10009]
§ Mr. HanleyWe regularly examine the effects of structural adjustment programmes in different regions, both in consultation with the World bank and independently. In central America and elsewhere, they are laying the basis for sustainable economic growth, a prerequisite for poverty alleviation.
§ Mr. CorbynIs the Minister aware that the fundamental expenditure review undertaken by his Department seems to give automatic support to structural adjustment programmes advanced by the International 640 Monetary Fund and the World bank, and that structural adjustment programmes throughout central America, in the wake of the end of the civil wars, are unbelievably destructive of human life? They are reducing life expectancy, increasing poverty and malnutrition and leading to considerable social discord and unrest. Is it not time to abandon the nonsense of such programmes, and to plan for the social needs of people in those countries rather than imposing market economics on them?
Two thirds of the population of Nicaragua, for instance, are now living in serious poverty, and unemployment has more than doubled in the past three years. Does the Minister think that structural adjustment programmes have something to answer for in relation to those terrible figures?
§ Mr. HanleySound economic policies are a key prerequisite for sustainable growth and poverty reduction, and adjustment programmes are designed to help developing countries to implement policy reforms in order to restore growth and strengthen institutions. The evidence from successive reviews shows that effective reform programmes are associated with reduced poverty, and inadequate programmes with worsening poverty. The ODA recognises the need to consider the social impact of adjustment programmes on the poor—indeed, we do consider it—and the World bank is working to improve the collection of information, and to improve policies for reducing poverty. The ODA has supported that work by seconding two consecutive social development advisers to the World bank since 1990. Let me repeat that sound economic policies are the key prerequisite for sustainable growth and poverty reduction.
§ Mr. Jacques ArnoldAre not the structural adjustment programmes allowing the countries concerned to return to proper economies? Combined with the overseas aid programmes involving investment in projects, would that not allow people to earn a living and self-respect, rather than having to rely on the begging bowl that seems to be the only alternative proposed by the hon. Member for Islington, North (Mr. Corbyn)?
§ Mr. HanleyMy hon. Friend is, perhaps, the most knowledgeable of hon. Members in regard to the region that we are discussing, and he is absolutely right.