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Globalization

Rich G8 Countries Need to Fulfill Promises

Jeffrey Sachs, Director of the Earth Institute at Columbia University and Special Advisor to UN Secretary General Ban Ki-moon, outlines what action the G8 must take to end poverty and retain credibility.

It is time to hold governments accountable, says Jeffrey Sachs

The Millennium Development Goals are the world’s agreed goals to cut poverty, hunger, and disease. They were established in 2000, with targets for 2015. We are at the half-way point to meet the Goals. So far, the rich G8 countries are not meeting their part of the bargain, despite endless words from the rich countries about increasing their aid to the poor countries. When new donor countries such as China enter the scene, the US and Europe tend to complain, as if their monopoly over low-income Africa and Asia is being broken. The political standing of the G8 in the world will plummet if it is unable or unwilling to follow through on its word.

Though the G8 promised to double aid to Africa at the 2005 Gleneagles Summit, there is no plan on how to do so. For the first year after Gleneagles, the reported aid numbers were padded by misleading accounting on debt cancellation operations. With those debt cancellation operations largely completed, the data are now revealing the stark truth. Development aid to Africa, and to poor countries more generally, is stagnant.

Gleneagles 2005 -- it is now time to fulfil those promises

Specifically, between 2005 and 2006, overall aid to Africa, excluding debt cancellation operations, showed a meager increase of 2 percent, far off track from a path of doubling aid. Total official development assistance to all recipient countries, net of debt cancellation, actually declined by 2 percent between 2005 and 2006. Even the World Bank, usually taking the donors’ point of view, recently acknowledged that except for debt cancellation, “promises of scaled up aid have not been delivered.”

All of this would seem to be insurmountable if the basic economics were not so clear. We are not talking about an unachievable amount of money from the rich countries. Indeed what we are talking about is minuscule. The G8, representing nearly 1 billion people in high-income countries, has promised to increase aid to Africa from $25 billion in 2004 to $50 billion in 2010. That $25 billion is less than one-tenth of one percent of the income of the rich donor world!

"Progress in the fight against poverty will contribute not only to survival and human dignity, but also to peace"

To put it in perspective, the Christmas bonuses this year on Wall Street -- just the bonuses -- amounted to $24 billion! The spending on the war in Iraq, which accomplishes nothing but violence, is more than $100 billion per year. The G8 could easily honor its commitments, if the rich countries had the slightest concern to do so.

To salvage the G8’s dwindling credibility, here is what needs to be done. First, the G8 needs to make crystal clear that it will honor its commitment to increase aid to Africa by $25 billion per year, so that total aid reaches $50 billion per year. That way, the cynics within the G8 governments can understand their assignments. Second, the G8 needs to put forward a plan of action. The lack of specific commitments by specific countries is shocking, and a display of governance at its poorest.

"The Christmas bonuses this year on Wall Street amounted to $24 billion"

Third, the recipient countries need to be told of the year-to-year increases in aid that they can expect, so that they can plan ahead to the year 2010. The increased aid should be directed at building roads, power grids, schools, and clinics, and at training teachers, doctors, and community health workers. Yet all of that investment requires plans and years of implementation. Aid needs to be committed in clear terms over a period of several years, so that recipient countries can use it sensibly and accountably.

African countries have already identified their high-priority investments in health, education, agriculture, and infrastructure (including roads, power, and internet connectivity). These investments could be increased systematically during the period from now until 2015, in order to enable those countries to achieve the Millennium Development Goals. It’s time for the rich countries to stop giving lectures to the poor, and instead to follow through on their own words.

Jeffrey Sachs

Progress in the fight against poverty will contribute not only to survival and human dignity, but also to peace. It is time, therefore, to hold our governments accountable for what they have pledged but not delivered.

Professor Jeffrey Sachs is Director of the Earth Institute at Columbia University and Special Advisor to UN Secretary General Ban Ki-moon. He has written this commentary specifically for DW-WORLD.

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