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Racism and Xenophobia Debate Gains Momentum

Documents
GAD Exchange, Issue No.22, October 2000
DRC Chronology, August 1998 - September 2000

   Recent meetings of champions of globalisation - the World Trade Organisation (WTO), the World Bank and the International Monetary Fund (IMF) - have been hit by mass protests masterminded by pressure groups from all corners of the world. The Bretton Woods institutions, as the Bank and the Fund are often called, fund economic structural adjustment programmes in developing countries which civic groups blame for worsening third world poverty.

    The message from these pressure groups has been clear - an expression of discontent at the Bretton Woods institutions' lack of a participatory approach to development. The international institutions have repeatedly refused to negotiate with anybody except governments, an attitude that has incensed civil rights groups worldwide.

    Scenes of mass protests have been captured on international television channels - the reaction of the police, the violent or non-violent nature of the gatherings, as well as measures taken by organisers, to ensure minimum disruptions to the meetings.

    The question however remains: "Will the Bretton Woods institutions depart from their tradition of arrogance - the know-alls of modern development economics?"

    In Prague, Czech Republic, venue of the 19-28 September annual IMF/World Bank meeting, international policy makers met to assess the threats of costly oil products and the fragile euro, while protesters held a mock funeral for children they say needlessly die because their countries are poor. The fundamental issue of third world debt formed a very small part of the agenda, despite the fact that it was key to the demonstrations.

    Campaigners have repeatedly accused the IMF and World Bank of strangling poor countries though unserviceable interest rates on loans that deny recipient countries the opportunity to channel resources towards health and education. In some counties in the Southern African Development Community (SADC) region - Angola, Malawi, Mozambique, Tanzania and Zambia - up to 30 percent of crucial export earnings are spent on debt servicing.

    The precedence of mass protests was set at Seattle in December last year during the WTO summit. The protests continued in Washington during the April IMF/World Bank meetings this year. The movement for global economic justice and the struggle against corporate-led globalization has since moved to Europe. And the international financial institutions can be assured the protests will follow them wherever they choose to gather.

    The April meeting drew nearly 6,000 street protestors to what had traditionally been quiet spring meetings of the boards of the two institutions in Washington. And at Prague, some 18,000 Bank and Fund delegates, including government officials descended on the Czech capital. Outside the conference venue, about 12,000 street protestors also converged in one of Europe's most beautiful cities, to spoil the party. Europeans have a history of large demonstrations for progressive causes than the US. Among recent mass demonstrations around Europe are the 70,000 protesters who encircled the 1998 G7 Summit in Birmingham, and 40,000 in Cologne in 1999, to demand debt cancellation.

    The chorus of criticism of the Bretton Woods institutions heightened this year with calls even in the US Congress to curtail the institutions' grip on developing countries.

    Recently, the US Congress voted in favour of a provision, effective 2002, to pressure the World Bank and IMF to stop demands that impoverished countries charge their people user fees for primary health services and primary education. This has long been one of the most controversial features of the austerity programmes mandated by the two institutions. Njoki Njoki Njoroge Njehu, director of the 50 Years is Enough Campaign, says: ''We do not want to raise another generation on promises from the IMF and World Bank that the sacrifice of their education and health will be 'short-term pain for long-term gain'."

    According to the UN Children's Fund (UNICEF), the elimination of modest school fees and uniform requirements in Malawi in 994 caused primary school enrolment to increase by about 50 percent virtually overnight - from 1.9 million to 2.9 million. The main beneficiaries were girls and since then, Malawi has been able to maintain near full enrolment.

    This is in sharp contrast with other countries such as Zambia and Zimbabwe where introduction of school fees, in line with IMF/Bank-funded reforms, has led to a decline in primary school enrolment.

    Convinced that the reforms are doing more harm than good in developing countries, a coalition of civic movements are calling on mass action against policies that hurt the poor. They are also urging people to protest privatisation, hold forums on debt cancellation and lobby investors to stop purchasing World Bank bonds.

    Jubilee 2000, one of the organizers of the mass protests called for widespread debt forgiveness, saying that 19,000 children are dying each day because of the high burden of debts in poor countries.

    "When the IMF and World Bank speak of reducing poverty on the one hand, while taking millions of dollars in debt repayments with the other, their current poor-friendly rhetoric rings hollow,'' said Jubilee 2000 director and co-founder, Ann Petifor.

    ''In Zambia, doctors and hospital staff have not been paid for three months, yet creditors ask for, and receive, a million dollars a week,'' he added.

    In a show of arrogance that the Bretton Woods institutions have become synonymous with, World Bank President, James Wolfensohn, has been on record castigating non-governmental groups opposed to globalisation and those persistently opposing his organisation's programmes. Speaking in Washington before the meeting, he said he expected "some form of acknowledgement for the positive work that the Bank is doing about poverty reduction." Despite numerous versions of the Bank and IMF policies, including the recent Poverty Reduction Programme where recipient countries are said to be participating in formulation, the fact remains that developing countries continually find difficulty in extricating themselves from the web of poverty and mounting debt.

    As a condition for lending money to poor countries, the Bank and the IMF often demand that governments privatise state-run enterprises such as universities, hospitals and other utility parastatals.

    "In Bolivia, last year, a World Bank loan encouraged the government to privatise the water system, which tripled water rates and water became unaffordable for many families,'' notes Call to Action, one of the groups lobbying for support for mass action.

    Armed with evidence of how the two institutions have dismally failed the world over , the protesters in Prague chanted: "The IMF kills, kill the IMF," and vowed to shut down the annual meetings.

    But the other question to ask is, "How successful have these demonstrations been, in putting pressure on the financial institutions to change?"

    The views are mixed. "We view this as a total success," said Robert Weissman, co-director of Essential Action, one of hundreds of groups in the protest coalition. "We have shone the light on these institutions as never before."

    During the Seattle demonstration, many of the demonstrators, believed their efforts, too, were worth it. "It caused a ruckus and that was the point," commented one activist. "It inconvenienced a lot of people and hopefully that makes them stop and wonder why they are being inconvenienced."

    Due to mounting public pressure, the recent meeting in Prague was finished a day earlier.

    Wolfensohn, speaking at the close of the IMF meet in Prague, could only apologise for the distress caused to the participants from the protests on the streets. About 12,000 police were drafted in to quell the protests, incurring a large bill for the organisers. The protests were viewed by the Bank chief as orchestrated by those "whose sole purpose is destruction".