A/HRC/23/37
44.
In Malawi, the liberalization of the agricultural sector through the reduction of
subsidies for small-scale farmers, the removal of prices controls and the
restructuring/privatization of the national agricultural marketing agency resulted in price
increases, the increased hoarding of grain and lack of affordable food for the poor, thereby
undermining food security for the majority of the population.43 In the United Republic of
Tanzania, the privatization of water supplies in Dar es Salaam resulted in severely reduced
access to water for the poorest, both through cuts in services and through increased user
fees.44
45.
The World Bank and IMF often emphasize that PRSPs, which are a condition of
HIPC Initiative eligibility, are nationally “owned”. However, it is misleading to speak of
country ownership of poverty-reduction strategies in circumstances where these are subject
to approval by the executive boards of the two institutions. There is also evidence that in a
number of countries, there has been a lack of effective participation in the development of
PRSPs as well as insufficient consideration of alternative policies. 45
D.
Lack of additionality
46.
An important factor in assessing the impact of debt relief is the issue of
“additionality”– that debt relief should supplement, rather than replace or be funded from,
existing official development assistance (ODA) budgets. Although creditor countries
pledged that they would not compromise debt relief by reducing ODA to poor countries, it
appears that debt relief has been provided instead of, not in addition, to ODA. It is notable
that the Organisation for Economic Co-operation and Development (OECD) Development
Assistance Committee’s definition of ODA includes relief on debt owed to OECD
countries. Thus, it is possible that some creditors have reported their debt relief
commitments as ODA.
47.
Yet another indication that debt relief is not additional is that the resulting debt
service reductions are largely offset by an equivalent reduction in future concessional
borrowing. For example, under MDRI, the IDA and ADF implement debt relief by
deducting the debt service payments forgiven each year from the recipient country’s annual
IDA allocation of disbursements.
43
44
45
14
K. Owusu and F. Ng’ambi, Structural damage: the causes and consequences of Malawi’s food crisis
(London, World Development Movement, 2002), available from
www.wdm.org.uk/campaign/resource.htm#reports.
Jubilee Debt Campaign, “Debt and Women”, Briefing Note (March 2007); see also Romilly Greenhill
and Irene Wekiya, “Turning Off the Taps: Donor conditionality and water privatization in Dar es
Salaam, Tanzania” (ActionAid International, September 2004): The project included loans of $61.5
million from the World Bank, $48 million from the African Development Bank and $34 million from
the European Investment Bank the repayment of which is due to begin later this year although $6.6
million has already been paid in interest and charges relating to the World Bank loan; see World
development Movement, “Tanzanian activists call for non-payment of World Bank water debt,” by
Tim Jones (30 April 2013), available from http://www.wdm.org.uk/world-bank-imf/tanzanianactivists-call-none-payment-world-bank-water-debt.
See for example, T. Bierschenk, E. Thioléron and N. Bako-Arifari, “Benin”; R. Jenkins and M.
Tsoka, “Malawi”; I. Dante, J.-F. Gautier, M. Marouani and M. Raffinot, “Mali”; H. Falck, K.
Landfald and P. Rebelo, “Mozambique”; A. Evans and E. Ngalwea, “Tanzania”, Development Policy
Review, vol. 21, Iss. 2, Special Issue: Are PRSPs making a difference? The African experience
(2003).
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