Paris Club: Are African Countries Huge Debtors?
The list of debtors released by the Paris Club- group of bilateral lenders to developing nations on 1st September 2008, raises a lot of fundamental questions. Kenya for instance has a debt of 2.07 billion US Dollars (USD). Algeria's debt stands at 6.621 billion USD; Botswana at 50 million USD; Cameroon at 1.353 billion USD; and Djibouti at 89 million USD.
As much as countries should not enter into debts that they cannot service, the Paris Club list does not reveal the purpose of the loans, who signed for them and under what circumstance. It is no closed secret, for example, that the West is reaping huge profits from DR Congo’s minerals but puts the country’s debt at USD 2.954 Billion. Could it be a ploy to further exploit the country in the name of debt repayment?
Africa’s over USD 200 billion debt burden is the single biggest obstacle to the continent’s development. Most of this debt is illegitimate, having been incurred either by despotic and unrepresentative regimes or manipulation. Donors for instance, dictate terms and conditions to African leaders; provide contractors, consultants and equipment to ‘borrowing’ countries. If say, Kenya’s 2.07 billion USD was accumulated to promote capitalism in the region, why should Kenya pay back if it played its role?
Most African government treasuries have never revealed their commercial indebtedness. Transparency and accountability is needed to dismiss allegations that there could have been falsifications in some debt entries and the negotiation deal should be transparent as well.
African governments should endeavor to represent their people’s wishes instead of being driven by donor interests. They ought to prioritize on their own financial agenda other than waiting for donors to direct them. Spending USD 14 billion on debt annually at the expense of essential service provision is a new form of slavery whose effects are no less devastating than war.
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