Debt and the AIDS crisis

The spread of AIDS in Africa is at a crisis point and is a human tragedy of historic proportions. Within the last 24 hours, 5,500 Africans were killed by AIDS.

It has reached such a crisis point as a result of long-term underfunding in health and education, mainly due to the servicing of debt and structural adjustment programs.

The countries most heavily impacted by AIDS have little money to devote to programs for AIDS prevention, treatment, and care. Part of the cure must be deeper debt cancellation measures. Many African countries have devoted millions of dollars to repaying old loans to wealthy creditors like the World Bank and the International Monetary Fund, as well as some wealthy governments.

African countries owe almost $300 billion in external debt, or about 12% of total debt owed by all developing countries included under the World Bank and IMF’s Heavily Indebted Poor Country (HIPC) debt relief initiative. Since 1996, when the process of negotiating debt relief under the HIPC initiative began, Africa has sunk further into poverty - the debt relief has delivered too little too late.

The number of people in extreme poverty in Sub-Saharan Africa rose from 242 million to 300 million during the 1990s. The region is now also facing drastic food shortages resulting from severe drought compounded by the general economic downturn. Of the 26 countries currently receiving debt relief, 19 are still paying out more in debt repayments than they are spending on health care.

Zambia, where 20 percent of the adult population is infected with HIV, spends $76 million on its health budget and $89 million on debt service to the IMF and World Bank . Several countries hard hit by HIV/AIDS such as South Africa, Nigeria, Kenya and Botswana, don’t even qualify under the HIPC initiative. Nigeria, for example pays US$1.7 billion in debt service each year to rich western creditors, eleven times its annual health budget.

However, with some limited debt relief available to them as a result of the Jubilee 2000 Campaign, a few African countries have been able to devote more resources to fighting AIDS. For example, Malawi received an initial cut in debt repayments of 30%, or $28 million. These funds financed the purchase of critical drugs for hospitals and health centres, hiring extra staff and support in primary health centres, and training new nurses. Uganda, Cameroon, and other countries have done the same, and communities hit by aids have seen the results.

A big problem with the current HIPC process is that it is dominated by the creditors, which is a bit like having loan sharks and bad credit card companies running the world’s bankruptcy courts. One of the results is that AIDS groups, groups of women and farmers, and others who should have a say in economic planning and budgeting get left out of important decisions.

Jubilee and debt campaigns around the world are campaigning to ensure that international insolvency procedures are developed that are truly independent and transparent. A fair and transparent arbitration process will allow a country whose debts have become unmanageable to declare itself insolvent, negotiate a fair settlement with all creditors, and keep enough resources to rebuild its economy ensuring the rights of the poor are respected.

Take Action - Write To Your Local Newspaper
Letters to the editor are designed to express your opinion - so give it. They are a quick and easy way of getting an issue aired in print.

Write a letter to the editor of your local newspaper expressing your concern about the tragic HIV/AIDS pandemic in Africa and the pressing need for debt cancellation. Use some of the points outlined in this article.

You may want to raise in your letter that one of the key Millennium Development Goals that the New Zealand Government has signed on to, is to halt and reverse the spread of HIV/AIDS by 2015. This goal cannot be achieved if poor countries battling the HIV/AIDS crisis are buckling under crippling debt.

Newspapers generally publish details of how to send in letters to the editor, word length and contact details required. Stick to these guidelines and you should see your letter published.

By Teri Calder, Jubilee Australia