Sometimes it can be tempting to think that there’s some contest between heads of government to see who can be the most callous without raising a major outcry. If there is, George W Bush has almost certainly taken the lead by claiming that the USA couldn’t support Gordon Brown’s proposed International Finance Facility because (as the BBC reports him saying) it
doesn’t fit our budgetary process.
The International Finance Facility is part of a package of proposals Brown is looking to take to the various G8 meetings due to take place in the next few weeks, culminating with the main G8 summit in Scotland next month. Brown is proposing 100% debt cancellation funded by a sell-off of some of the IMF‘s gold reserves (which have increased in value of late due to the rising price of gold), a significant increase in development aid from the richest countries, removal of trade subsidies by which rich countries flood poor country markets with cheap goods (destroying indigenous business), and the International Finance Facility that would allow poorer countries to borrow money against promised future aid (in effect allowing them more control of the flow of aid facilitating more strategic use).
Brown’s proposals are far from perfect. Details are still sketchy on the conditionality that would be attached to that 100% debt relief, which has long been one of the key issues. The current system is equivalent to a credit card company deciding whether its customers can declare bankruptcy. Independent arbitration of a country’s eligibility is long overdue.
The proposals are, however, a significant step forward and could mark the beginning of a sea change in development aid. Some form of IFF would allow the world to move away from the economic serfdom currently experienced by its poorest inhabitants. If our budgetary processes stand in the way of providing relief for the world’s very poorest inhabitants, then those budgetary processes must be changed. It’s the only real way to begin spreading freedom across the world.