§ 7. Mrs. Sylvia Heal (Halesowen and Rowley Regis)What action her Department intends to take to assist in the reduction of the debt burden of countries that do not qualify under the terms of the heavily indebted poor countries initiative because of recent conflict. [42503]
§ 10. Fiona Mactaggart (Slough)What progress has been made in reducing the indebtedness of countries that do not qualify for the heavily indebted poor countries initiative because they have recently come out of conflict; and if she will make a statement. [42507]
§ The Secretary of State for International Development (Clare Short)Following a British initiative, the G8 summit agreed on the need to look at ways in which to provide more and earlier debt relief to help heavily indebted post-conflict countries, such as Rwanda and Liberia. Special arrangements are needed because, by definition, they lack a track record of good economic management, having come out of war and crisis. We are working to implement this and, in the case of Rwanda, the UK has made a substantial pledge to the debt trust fund for Rwanda at the donors meeting which is taking place in Stockholm.
§ Mrs. HealWill my right hon. Friend—who is aware of the particular problems of those countries—do all she can to urge the international community to respond to their exceptional needs as they try to rebuild their 357 political, economic and social systems? She will know of the many organisations linked with Jubilee 2000, and of the concerns of the British Medical Association about the impact that debt has on the health of those countries.
§ Clare ShortMy hon. Friend is right. In Birmingham, I met lots of people who came—with enormous dignity and good spirits—to call for help with debt relief. Rwanda is coming out of bitterness and pain after surviving genocide, when the world let it down and failed to intervene, and it has a Government who are trying to do the right things. If we do not assist the Government in bringing relief to the country—Rwanda is one of the poorest countries in the world—the chance of it returning to conflict is great. It is in everyone's interests that we make greater progress and are not rigid about the formula, thus excluding post-conflict countries.
§ Fiona MactaggartI was pleased to hear that part of the Secretary of State's response which suggested that we would be able to make a contribution to Rwanda's being able to meet its current debt. Does she accept that many of the countries of the poorer world find it unfair that the international mechanism seems to be a one-way street? The UN did not deliver protection from genocide in Rwanda, yet countries are expected to fit in with incredibly stiff recommendations in terms of meeting debt relief proposals. Will she work to try to make sure that, within debt relief programmes, the future prospects and accountability of a country are taken into account, as well as its history?
§ Clare ShortI agree with my hon. Friend, as did Kofi Annan and all serious observers, that the international community badly let down Rwanda. We are committed by convention, following the holocaust in Europe, always to intervene to prevent genocide. We failed to do so, and we pulled out UN troops. There was systematic, organised slaughter, and we should never forgive ourselves for that. I do not fully agree that, in all cases, the debt owed to the IMF, to the World bank and for export credits is unfairly imposed. In some cases, bad Governments have been replaced by good Governments, and they need help. Borrowing is not always bad. If it is borrowing for good investment, it is desirable. We need good Governments to get out from the overhang of bad debt so that they can build their economies for the future.
§ Mr. Gary Streeter (South-West Devon)No one doubts the personal commitment of the Secretary of State to debt redemption. However, she will be aware of the widespread disappointment and anger at the abject failure of the recent G8 summit to take the matter forward. Can she confirm that the Government remain committed to giving a lead in relation to debt redemption, albeit linked to good governance? Will she continue to seek to persuade leaders of other creditor nations to do exactly the same?
§ Clare ShortThe hon. Gentleman must not believe everything he reads in the newspapers—he should have read the communiqué produced at the summit. The truth is that, shortly after forming our Government, my right hon. Friend the Chancellor made a speech calling for speeding up of the implementation of the HIPC initiative, and for three quarters of eligible countries to be untrapped 358 by 2000. Immediately after the general election, in a meeting with the World bank and the IMF, we could not reach agreement on the initiative. We now have the support of all the major countries. Partly because of pressure by those good people demonstrating on the streets of Birmingham, implementation of the initiative is being speeded up. We need now to make more progress in dealing with the debt problems of post-conflict countries, which will be a complex matter. However, for some of the poorest countries, the problem is not debt. We have to act on poverty and on good governance—which includes dealing with debt, but not only with that.
§ Mr. John Townend (East Yorkshire)Will the right hon. Lady reassure the House that, if the United Kingdom writes off a country's debts, we shall not make further loans out of taxpayers' money to that country? Otherwise, in 10 years' time, we might be faced with the same problem. When help is needed, is it not better to provide it as aid rather than as loans that will not be repaid?
§ Clare ShortI am sure that the hon. Gentleman knows that the initiative is not only British, but international; that the issue encompasses export credits to many countries, IMF debt and World bank debt; and that the initiative provides relief only to countries that adopt good economic management to improve their economy and benefit poor people in their country. Countries must have a track record of such economic management both before and after they sign on for debt relief. I assure the hon. Gentleman that no country will receive debt relief unless it is being very responsible in its economic management. I give him that complete assurance.