Have we made poverty history?
Analysis
by Steve Schifferes
BBC News economics reporter

The UN summit has disappointed poverty campaigners. But concrete results depend on two crucial meetings yet to come.

The UN summit - on the 60th anniversary of its formation - was originally called to endorse and measure progress on the millennium development goals, the pledges made at the UN five years ago to tackle world poverty by 2015.

But plans to fight terrorism, and failed plans to expand the membership of the UN security council, have dominated the three-day meeting of world leaders.

It is hard to believe that the cry for justice has fallen on such deaf ears
Charles Abugre, Christian Aid
The ambitious goals set by the leaders of the world's richest nations, the G8, at the Gleneagles summit in July, remain in force - to double aid, to increase debt relief, and to open trade barriers to poor countries.

However, it will be other meetings - notably the World Bank/IMF annual meeting in Washington next week, and the Hong Kong trade summit in December - which will determine whether they will succeed.

Aid targets

Campaigners originally had high hopes that the UN summit might see further commitments by rich countries to increase aid flows.

UK Prime Minister Tony Blair told the summit that "the struggle against global poverty will define our moral standing in the eyes of the future".

But in fact, it was only after hard lobbying that the US agreed that the millennium development goals would even be mentioned in the final declaration - and there was no commitment that rich countries should meet the 0.7% of GDP aid target.

"It is hard to believe that the cry for justice has fallen on such deaf ears," said Christian Aid's Charles Abugre.

"This makes it less likely that the massive resource gap that exists for financing the millennium development goals will ever be closed."

The summit did establish a peace building commission to help resolve conflicts, many of which take place in developing countries.

And it documented in great detail the progress - and lack of it in Africa - in meeting the poverty targets.

As poverty campaigner Sir Bob Geldof said, "I understand this is a process but the process should have been accelerated and added to at the UN."

Debt deal

Now the focus moves to implementing the debt relief deal agreed by the G8 finance ministers and endorsed at Gleneagles.

This called for the World Bank and the IMF to grant full debt relief to the 18 countries - mainly in sub Saharan Africa - that had qualified under the highly indebted poor countries initiative (HIPC), and for the rich countries to fully fund the cost of the write-off.

The battle is sadly still on to defend the very basic minimum of the G8 deal
Stephen Rand, Jubilee Debt Campaign

But some of the smaller developed countries such as Switzerland and The Netherlands are now objecting to the deal.

They fear that the cost of the debt relief - after the initial three years - will not be fully funded by the big nations, and that the plan will hurt other developing countries that do not receive debt relief.

The World Bank has produced its own estimates that, according to the Washington Post newspaper, say it could cost the organisation $42.5bn over three decades if all 38 potentially eligible HIPC countries eventually get debt relief.

That could "reduce significantly" the Bank's lending programme to poor countries, known as the International Development Association, the report says.

Stephen Rand, the co-chair of the Jubilee Debt Campaign, says that the debt deal is still in the balance.

"The battle is sadly still on to defend the very basic minimum of the G8 deal," he said.

Debt campaigners are disappointed that their hopes of easing the conditions that poor countries have to meet before receiving debt relief are not likely to be realised.

Indeed, another issue raised by those opposed to the debt deal is whether further conditions - such as good economic management - should continue to be imposed by the IMF on countries who have already qualified for debt relief.- something those highly-indebted countries would vigorously oppose.

Trade talks

There was much rhetorical endorsement of the importance of a global trade deal at the UN - and trade has the potential to boost developing country incomes far more than aid flows.

Tony Blair said that it was "essential" to nail down a deal on bringing down trade barriers at the world trade talks.

President Bush said that "the elimination of trade barriers could lift hundreds of millions of people out of poverty over the next 15 years".

And Brazil's President, Luiz Inacio Lula da Silva, called it outrageous that agricultural subsidies given to farmers in rich countries came to six times more than the aid money needed to meet the UN's millennium goals to curb hunger.

A key part of any global trade deal - under the Doha Round of negotiations that have been going on since 2001 - would be acceptance by rich countries that they need to open their markets in agricultural products to poor countries.

But while the UN summit was going on, the key agricultural talks at the World Trade Organisation in Geneva were adjourned a day early without agreement.

The chair of those talks, Crawford Falconer, told delegates to stop getting bogged down in details.

He said that with only three months remaining before the Hong Kong meeting, the agriculture negotiations needed to adopt a more comprehensive approach.

The problem is that both the US and the EU are waiting for the other side to make the first move in the reduction of subsidies - something that will be politically difficult on both sides of the Atlantic.

As Mr Blair put it, "The attitude I think the Europeans should have on this is to say to the Americans: 'Fine, you want to get rid of tariffs and subsidies for these countries, we'll do the same."'

But with time running out for a global trade deal, the bright promises of the summer appear to be fading.

Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/4251626.stm

Published: 2005/09/16 10:49:52 GMT

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