HC Deb 27 February 2003 vol 400 cc383-5
2. Mr. Parmjit Dhanda (Gloucester)

What plans he has to extend the scope of international debt relief. [99463]

The Chancellor of the Exchequer (Mr. Gordon Brown)

With your permission, Mr. Speaker, I shall answer this question together with Questions 14 and 16.

I am pleased to announce that, following the G7 meeting in Paris last weekend, all G7 members have agreed to examined how, in the short term, we can do more to help countries where, because of the decline in commodity prices and for other reasons, they have yet to achieve a sustainable exit from debt from our debt relief programmes. We shall also examine how, in the longer run, we can together provide a new international finance facility, so that instead of poor countries having to pay higher debt interest payments, they will have additional resources to invest in tackling illiteracy and disease.

I have been grateful for all-party support for these initiatives. We hope to make further progress on all these matters at the International Monetary Fund and World Bank meetings in April this year.

Mr. Dhanda

On behalf of trade justice campaigners in Gloucester and around the country, may I sincerely congratulate my right hon. Friend the Chancellor on providing 100 per cent. debt relief to 26 developing countries? At the same time, however, does he share my concerns about the activities of private companies, of which those of Nestlé in Ethiopia offer one example? Such companies are pursuing litigation against heavily indebted poor countries, which often hampers our efforts to provide debt relief.

Mr. Brown

I am grateful to my hon. Friend and I thank him for the work that he does in his constituency to promote the debt relief campaign and the pursuit of the millennium development goals.

I gather that Nestle is now settling the issue with Ethiopia. I met the Prime Minister of Ethiopia only two days ago, and I promised him, on the issue of debt relief, that I and my right hon. Friend the Secretary of State for International Development would try to find a means at the international meetings in April to do more to help his country with the debt relief programme that he wants to carry out. In the longer term, the issue is less what we do on debt relief than how much more resources, tied to reform, we can put into education and health programmes for countries such as Ethiopia and others. That is why the international finance facility, a British initiative gaining support among other countries, is so important. It is the long-term means by which we can guarantee that, instead of the poorest countries having to rely on debt relief, they will receive additional resources.

Mr. Speaker

I call Phyllis Starkey.

Hon. Members

Where is she?

Mr. Speaker

Not here. I call Helen Jackson.

Hon. Members

Where is she?

Mr. Speaker

Order. Will the Chancellor investigate whether Phyllis Starkey and Helen Jackson were notified? I call Sir Patrick Cormack.

Mr. John Bercow (Buckingham)

He is always here.

Sir Patrick Cormack (South Staffordshire)

May I add my thanks and congratulations to the Chancellor? What steps are being taken to ensure that corrupt and tyrannical regimes are not the beneficiaries of what he is doing?

Mr. Brown

The whole House appreciates the hon. Gentleman's work in respect of Commonwealth countries. If we are to provide additional help for health, education and anti-poverty programmes, we must have a guarantee that the money will go not to corrupt elites, wasteful military expenditure and prestige projects by bureaucracies, but to the people. That is why the IMF's poverty reduction strategy programmes are so important, and why the initiatives that we have taken on transparency for fiscal and monetary policies in the highly indebted countries are important. The hon. Gentleman will be interested to learn that we are offering help to those countries to build up their capacity to run transparent financial policies, and thereby ensuring that everything possible is done to prevent the corruption to which he referred.

Mr. John McFall (Dumbarton)

Does my right hon. Friend the Chancellor recall the UN development programme head who stated that the reason for 11 September was not Islam but the failure of Governments? Will my right hon. Friend continue to articulate the view that the world's long-term stability lies in easing the deep resentments in many developing countries? Will he work with the trade justice campaign and other campaigns to ensure that trade barriers are reduced, that the common agricultural policy is reformed, and that the World Trade Organisation fulfils its remit in respect of people in developing countries?

Mr. Brown

My hon. Friend is Chairman of the Select Committee on the Treasury and he is absolutely right: a world that is divided between people who have plenty and those who are denied basic necessities can be neither just nor stable. That is why it is so important that we move forward to build a better relationship between developed and developing countries. As well as the actions that I have set out—on corruption and on providing extra aid resources—that better relationship includes the opening up of trade. Therefore, I appreciate what the hon. Gentleman says. One of the biggest boosts to tackling poverty in the poorest countries will be progress at the WTO talks in Mexico in September.