3rd Year Week 2 HT05
Topic: Aid The Third World
Translate the following first five paragraphs into Chinese.
Two thirds world debt is one of the world's biggest killers
Jubilee 2000 is an international debt forgiveness campaign, aiming to help emerging countries to become economically self-sufficient. Many countries have run up massive debts. Since these debts can only be paid through export earnings, the best way to measure the burden is by comparing export earnings with total debt. Examples (World Bank figures 1998):
Every time you give $1 in aid for a project on a developing country, at least $1 is taken from that country in interest on long term debts to banks or other governments or UN bodies. In some cases the ratio is as high as $1 donated to $3 extracted.
As a direct result, spending on health and education has actually fallen in some of the poorest nations over a decade when the rest of the world has become more prosperous.
What can be done? Clearly those who are owed money are extremely unlikely to see their money back. Therefore the logic is to write off these debts, and to be more cautious about lending money in future. Sadly in many cases substantial parts of these loans were spent propping up corrupt regimes and lining the pockets of dictators.
A compromise is the debt swap programme. Let us take a bank which is owed $1bn, shown on their balance sheet. In reality the loan agreement is almost worthless since the bank has little way of enforcing repayments on a country that has no foreign currency to pay interest or repay capital. Along comes a development agency wanting to invest in health promotion and care, with a budget of $100,000. The agency offers to buy the debt off the bank for $100,000, and the bank is delighted. The agency agrees at the same time with the debt-crippled government that this debt will only be paid off if the government agrees to spend the equivalent of $100,000 in local currency on approved health programmes.
In theory the net result is that a major debt is cancelled, and the local economy is stimulated. In practice these arrangements are hard to supervise and governments can default on programme delivery just as they did on interest repayments. However there have been some successes.
The latest proposals from the UN are that debt will be written off if countries can show they have been following responsible economic policies for eight years. A number of countries are already in the scheme but there is a major problem. Eight years is far too long for a country that is becoming progressively destabilised as a result of grinding, overwhelming poverty. As events in Indonesia have showed, a country under pressure may begin to fall apart with riots, civil disorder and violent changes in government. The very policies designed to impose discipline can wreck a country.
Four years is long enough for an emerging country to take costly steps without any visible return.