[A-List] African Debt Revolt

["Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>]

September 28, 2002

Crippling debt and bankrupt solutions
By Henry C K Liu

Excerpt:

"Former Harvard (now Columbia) economist Jeffrey Sachs, having landed
Russia in gangster capitalism with his shock-treatment approach to
instant reform, called in 1995 for the provision to transitional
economies the basic protections available to corporate borrowers in the
United States, and proposed an International Bankruptcy Court. While
then US Treasury secretary Robert Rubin was sympathetic, his deputy,
Lawrence Summers, criticized the corporate analogy as potentially
misleading on two grounds: first because "the decision of a state to
suspend its debt service is at least partly volitional", meaning
politically motivated rather than financially based, and second because
"the safeguards against moral hazard built into domestic bankruptcy
codes cannot be applied to sovereign debtors".

[SNIP]

"Foreign debt in the existing international financial architecture is in
essence highway robbery of the poor countries by the rich in the form of
predatory lending. Collective sovereign foreign debt default in a
massive debtor revolt is the only rational solution, and lender
liability action against foreign lenders is the only way out for the
world's indebted poor." End

http://www.atimes.com/atimes/Global_Economy/DI28Dj01.html

Four years later:

The East African (Nairobi)
January 25, 2006
By Philip Ngunjiri

With a $201b debt, Africa will never end poverty, says Sachs
The director of the Millennium Project, Prof Jeffery Sachs, has asked
Africa to repudiate its $201 billion debt if developed countries fail to
cancel it. Describing the debts as "unaffordable" Prof Sachs, who is
also an
advisor to the UN said: "If they won't cancel the debts, I would suggest
obstruction by yourselves."