Trade is Better than Aid for Third World Debt Relief
April 4, 2006
For years, many in the entertainment industry have chosen to blame the West in general, and the USA in particular, for problems of the world. Well-intentioned organizations, such as the World Economic Forum, undermine their credibility by enabling any less-than-educated celebrity a place at the table for “only” $25,000 - at its annual meeting in Davos, Switzerland. Each year, U2’s lead singer, Bono, appears in Davos and makes a fool of himself. More recently, during the G8 Summit in Gleneagles, Scotland, Bono claimed that Third World debt could be wiped-out overnight with only $1 billion!
The irony is that, being among the most expensive ski resorts in the world, Davos is inaccessible to almost all people of the world, whom the World Economic Forum wants to help. If anything, the World Economic Forum should meet in the Third World. Likewise, I cant understand why Bob Geldof did not invite any Third World entertainers to appear at his recent Live 8 benefit concerts, until he was finally pressured into inviting a Senegalese singer! With his original Live Aid concert in 1985 during Ethiopias last famine, Bob Geldof was well-intentioned. But he was extremely naive in implementation of aid, as most fell into the hands of former dictator Mengistu Haile Mariam!
In reply to Bono, I will quote friend and colleague, Randy Reece, originally from Spiceland, but now living on the Left Coast. Randy suggested Bono and 999 cronies from Hollywood, West L.A., and Manhattan each pony-up $1 million. That’s “chump-change” for them and, according to Bono, would wipe-out Third World debt overnight!
Third World debt should be of concern to us as Americans for a variety of reasons. These include: rights of women and children; health and education; famine (such as in Niger); cocaine cultivation (such as in Bolivia); genocide (Rwanda a decade ago); spread of democracy; and prevention of terrorist breeding grounds. However, as an American taxpayer, I do not want to be saddled with helping bail-out banks, who made bad loans in the first place, just because of an edict made on a Scottish golf course.
More and more African leaders will tell you that many of Africa’s problems could simply be solved through trade. On July 23 and 24, 2005, the BBC aired an excellent round-table forum, Africa: Hope for Tomorrow; which included a former President of Ghana, a white Kenyan farmer/war correspondent, a Nigerian civil rights activist/author, the High Commissioner for South Africa, and the Deputy General Secretary of the Commonwealth, a Tanzanian. With one exception, they were all in agreement that Africans are entrepreneurial by nature, that years of socialism have set back Africa, and that they would prefer a hand-up to a hand-out. The mixed-race moderator posed tough questions ranging from corruption to promiscuity’s spread of AIDS to free and fair trade.
The front page of Muncie’s Star Press of July 7, 2005, had a map showing the 18 poor countries (14 of which are in Africa), whose $40 billion (sorry, Bono!) debt is being forgiven by the G8. From this list, I have personally opened Bolivia, Ethiopia, Honduras, Mali, Nicaragua, Senegal, and Tanzania for my employer. If business can be done with these countries, it can be done with others on the list.
Trade is Better than Aid for Third World Debt Relief was written by PAI's Senior International Business Fellow. © PAI 2006.