For western governments to lecture the likes of Pakistan about democracy and stability, as David Cameron did this morning, must seem a cruel joke to many in that country. Our part of the world has a long history of generously lending money to fuel violence, prop up undemocratic, often brutal regimes and exacerbate poverty.
Pakistan is a country with only 54 per cent literacy, and where 38 per cent of small children are underweight, yet it spends nearly $3bn a year servicing debts — almost three times what the government spends on health.
Loans have flowed freely into Pakistan in order to keep favoured military governments in power, most recently that General Pervez Musharraf, when Pakistan’s debt increased from $32bn to $49bn.
A recent $7.6bn International Monetary Fund loan, needed so that the country can keep paying off its old debts, is conditioned on reducing budget deficits, eliminating electricity subsidies and increasing indirect taxation. As usual, ordinary people will pay for the west’s “largesse” that kept in power governments subservient to western interests.
Such injustice doesn’t stop at Pakistan. Consider Indonesia, where 61 per cent of the population live on less than $2 a day. Like with India, as David Cameron reminded us this morning, fighting poverty in Indonesia will be central to the success of the Millennium Development Goals. But just like India, this seems a second-order priority compared to selling scores of Hawk fighter jets to the country.
Indonesia still owes the UK over $500m for Hawk jets and other military equipment sold to the brutal General Suharto. Suharto was guilty of crimes against humanity by any standard, killing up to a million political activists in his first year in office.
Today, Indonesia pays over $2.5m every hour to service its $150bn debts — much run up by Suharto. Is it surprising if Indonesians think their lives matter less than the financial and strategic interests of the west?
Afghanistan has been rushed through the debt cancellation process to prevent any embarrassing examination of past lending, but has been forced to privatise its banks and will doubtless return to the same state of heavy indebtedness in years to come — it serves the government, which needs the finances to hold on to power, and it serves the west, which needs the debts to keep control after the soldiers leave.
Control of these countries can be maintained through this same, deeply unjust economic system, through playing one faction off against another, through fighting when everything else fails to work. Democracy, stability and trust, however, require something far bolder, but not impossible.
It is possible to stop lending in such deeply unjust ways. It is possible to cancel debts based on loans that should never have been lent. It is possible to stop forcing countries to pay what they are unable to afford, or to force them to make their economies work in our interests simply because we can.
As repayments on deeply toxic debts continue to drain Muslim countries of their wealth, we need to realise that the debts, or reparations, if you prefer, that our governments owe the Muslim world are vast and rising. Trust will not be possible until they are paid.
The Jubilee Debt Campaign’s “Fuelling Injustice: the Impact of Third World Debt on Muslim Countries” is available at jubileedebtcampaign.org.uk.
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