Canterbury

By David Skidmore
Lambeth Conference Communications

Archbishop Njongonkulu Ndungane of Cape Town, primate of the Church of the Province of Southern Africa, put international debt on the center stage of the Lambeth Conference Friday by calling for cancellation of the debt of developing countries.

At a three-hour plenary session for bishops and spouses, Archbishop Ndungane urged the bishops to follow the Gospel injunction to "bring good news to the poor" by supporting the Jubilee 2000 campaign for cancelling $214 billion in debt burdening the developing world. Inspired by the tradition reported in Leviticus of holding a Year of Jubilee every 50 years, the coalition of churches and social outreach organisations is campaigning for cancellation of the debt of the world's poorest countries by the year 2000.

"It's a vision that releases the poor from the prison of indebtedness and dependent poverty. It's a vision where God's people have all that is necessary to live a human life," said Archbishop Ndungane, who chairs Section One (Called to Full Humanity), which is studying international debt.

A benefit for all

"The crisis of international debt that we are debating here today is not just a matter for the poorest countries. Nor is it a matter that only affects sovereign governments," he stressed. "It affects all of us everywhere."

Families in the developed world worry about making mortgage payments, about job security, and the continual erosion of their purchasing power. But for those in the developing world the situation is more acute.

"We all live in the grip of an economy which encourages over-lending and over-borrowing, an economy which drives relentlessly into debt. But the poorest, those with very little income to depend on, are not just in the grip of this economy," charged Archbishop Ndungane "they are enslaved by it."

As Bishop Nicodemus Engwalas-Okilli of Uganda, another plenary speaker, said of Uganda, "This small country carries on the head of her citizens an external and unpayable debt of $3.7 billion. Every single man, woman and child owes the World Bank $186. We just cannot pay. And the reason we cannot pay is that we cannot pay."

Dramatic examples of debts' effects

Archbishop Ndungane said, "We live in a world where the human family has become increasingly divided" between the haves and the have nots, he said, asserting that cancelling the debt is a matter of economic justice. The world worships money, he said, and in fact, "has more powerful rights than human rights."

Indebted countries are locked into a spiraling debt cycle in which they must borrow money just to pay for the interest on their accumulated debt. And when loans prove insufficient or fall through, these countries use the development aid to pay the interest. For every dollar received in aid, developing nations are sending $11 back to the donor countries, said the archbishop, often in the form of commodities that are given away "virtually free" for loan repayments.

Bishop Hilkiah Omindo of Mara (Tanzania), who attended the plenary, said he can appreciate the opposing claims in the debt debate. "Our country is trying very hard to pay," he said. "We should pay back, but at the same time the need at home is great." He said he is particularly bothered by the fact that "we're paying on the interest," with no chance to pay off the principal. Payment on the debt would "make sense if there was a way to reduce it," he said.

Hearing varied voices

Archbishop Ndungane's message was echoed by two other keynote speakers-Bishop Luiz Prado of the Diocese of Pelotas (Brazil) and Bishop Peter Selby of Worcester (England), who chaired the subsection dealing with international debt. Panelists included Bishop Renato Abibico of Northern Luzon (Philippines); Bishop Geralyn Wolf of the Diocese of Rhode Island (ECUSA); Samuel Arap Ng'eny, an Anglican Consultative Council member from Kenya; and Bishop Dr. Nicodemus Engwalas-Okille of Bukedi (Uganda). The session was chaired by Archbishop Orland Lindsay of the West Indies.

In an introduction to the speakers, Archbishop George Carey observed that "if poverty in Africa is to be turned around, there are hard decisions to be made, and great responsibilities" for everyone involved in the debt crisis.

"What I am convinced of is it can happen and must happen. I believe the depth of suffering which we have seen and which we will continue to see in so many parts of that great continent go far beyond what is tolerable in a civilized world," he said.

Mr. Arap Ng'eny described how the cure can sometimes be worse than the disease, when austere economic measures, called Structural Adjustment Programmes (SAPs), are imposed to help a country make its debt payments.

Privitization of government-owned industries, for example, he maintained, tends to lead to foreign control of companies, and other adjustments may discourage rather than encourage production. Kenya has become an importer of maize, he said, the population's staple food, he said, and "at present there is a shortage."

Bishop R. Barry Jenks of British Columbia (Canada), and his wife, Barbara, who both attended the plenary, said they became engaged in the international debt issue after serving the church in Guyana. After a currency devaluation was imposed, Mrs. Jenks said she was struck by the scene of "women in the market trying to buy rice and realizing that they didn't have enough money. I can vividly remember the fear and anger. That really hit me."

World Bank president criticizes video

A discordant note came from World Bank President James Wolfensohn who took issue with a video presentation by the Christian Aid agency that led off the session. The video, which reported on the hardships brought on by crushing debt in Jamaica and Tanzania and criticized debt relief efforts of the World Bank and International Monetary Fund (IMF), prompted a sharp rebuke from Mr. Wolfensohn.

"I am not angry about the film. I'm upset. I'm upset because it paints a picture of our institution which is quite simply wrong," said Mr. Wolfensohn, who flew from New York just to address the plenary.

To characterize the World Bank as the villain in the debt crisis is "neither fair nor correct," he said. The World Bank, which was established after World War II to coordinate international efforts at reconstruction, has been at the forefront of efforts to eradicate poverty, he said.

He also said that cancelling the debt would not guarantee that the money saved would be used for social needs, especially in countries in which government corruption is common.

On one point, however, he said he agrees with the video's producers: "that there is a significant and overwhelming debt burden on many countries." (For further information on Mr. Wolfensohn's comments, see Lambeth Conference Communications press release #51.)

Casting no stones

Archbishop Ndungane, who spoke after Mr. Wolfensohn, said the bishops had not come to Lambeth "to cast stones on anyone, but are here to reason together and to find solutions at the dawn of this millennium."

Everyone is needed on this mission, including the World Bank and the IMF, he said. But when policies are skewed in favor of the creditors, it is reasonable to raise questions, he added.

There are also no provisions for restructuring the debt through an impartial process, such as the bankruptcy courts found in most countries, he said. Instead, Western creditors "act as plaintiff, judge and jury" when deciding who gets loans, loan repayment terms, and the conditions for debt relief.

The World Bank and the IMF, the channels for nearly half the debt incurred by developing countries, have a different set of priorities than a bankruptcy court, he said. If a corporation files for bankruptcy, the managers and workers are spared liability, but that is not the case for the children of indebted nations. Creditors, led by the IMF, have made it clear that debt repayment ranks ahead of payments for health, education and clean water, he maintained.

Proposal for Mediation Council

A new mechanism is needed, said Archbishop Ndungane, who proposed a Mediation Council that would provide "a strict and neutral arbitration process" for debt relief. Other initiatives have been tried, notably the Heavily Indebted Poor Country Initiative (HPIC) launched by the World Bank and IMF two years ago to assist the most-burdened countries, but each of these efforts have been heavily weighted in favor of the creditors, he said.

The Mediation Council he proposes would act as an international bankruptcy court concerned with giving heavily indebted countries a fresh start. Legislatures and parliaments would be encouraged to follow the example of Uganda where loans must be first approved by Parliament.

"The Mediation Council would challenge corruption, in both lending and borrowing," he said. "It would take evidence from experts. It would assess the country's capacity to pay. Above all, it would seek to protect ordinary citizens-men, women and children-from having to carry the full brunt of the country's debts and losses." In short, Ndungane said, "it would stop the poorest people of a country falling into a bottomless pit of debt in the future."

The cost to all lenders of cancelling all debts, by the World Bank's own estimates, is $7.4 billion, he said. Compared with the bailout money paid this year to Russia-$12.6 billion-and to banks floating $60 billion in South Korean loans, the cancellation is possible, but probably not politically palatable to the G8 countries (the eight largest industrial nations: the United States, Canada, Japan, Great Britain, France, Germany, Italy and Russia).

"What is lacking is the political will to find money to bail out the poorest people on earth," he said. "In the wake of this indifference, the faith community must act. The world is waiting for a word of hope, good news to the poor," he said. "What the bishops can give is one voice, a voice strong in defence of the poor, bold in contradiction to the rule of money, and full of the love of God."

Worcester bishop adds his call for cancellation

In the concluding presentation, Bishop Peter Selby, chair of the subsection addressing international debt, proclaimed, "For the sick and the orphaned and the widowed and the children who need food to see tomorrow, cancel the debt!"

Cancellation should come without restrictions, he said. "Cancel the debt uncompromisingly and unconditionally. And we do not ask for charity or generosity; we are looking for simple justice." The uses for the original loans have to be considered, he asserted. "When is a debt not a debt? Not something that ought to be paid? Is there a debt for a tank that was used to attack your parents? Is that a debt?"

The structures such as the World Bank set up after World War II to support international reconstruction no longer serve, and have created an impossible force of debt that he likened to a "false divinity," which "we all thought was an instrument, an instrument that served us." The debt, he said, "has rights more than the rights of human beings. And frankly, like many false divinities, it does not fail to ask for human sacrifice."

Nan Cobbey, Katie Sherrod, Allan Reeder, Lisa Barrowclough and James Thrall contributed to this article.