The G20 will do little to help Africa escape the cycle of debt and misery, according to studies by leading NGOs and aid agencies working in the continent.
The reports from the World Development Movement (WDM), Actionaid and Christian Aid state that far from helping countries in the Global South, the policies advocated by the G20 are keeping them poor.
This is one of the many reasons for people to protest against the G20 meeting in London, say activists from the Global South.
Mani Tanoh, a leading socialist and anti-privatisation campaigner in Ghana, spoke to Socialist Worker.
He said, “The G20 constitutes the political leadership of the main countries in the world – the people who relate to the big financial institutions, such as the International Monetary Fund (IMF), the World Bank and the World Trade Organisation (WTO).
“It is amazing how little clue they have about what is happening. The G20 leaders are still recommending ‘liberalisation’ – solutions that are the opposite of what African countries need.
“So the IMF insists that African governments should pass on higher food and fuel costs to the general population as a precondition for new loans.”
The WDM report shows how Western banks have made matters worse for poorer countries.
It states that the “liberalisation agenda” being pushed by the leading powers “seems especially remarkable in the context of 2009, where the fragile nature of the liberalised bank sectors of the US and Europe has been exposed and almost universally criticised”.
Mani said, “The conventional wisdom has been that as Africa is marginal to the global economy, it will escape the crisis by‘decoupling’ from the rest of the world. But now they are having to go back on their words.
“In recent years the restructuring of global production has meant that Africa has fallen behind, apart from a small number of enclaves.”
Meanwhile Actionaid has produced a report which shows how the neoliberalism being pushed by the banking sector affects foreign trade.
Free market policies failed to benefit the Global South, even before the recession.
The report takes South Africa as an example: “Since 1994, the South African government has adopted a strategy of extreme openness to the global economy, but this has not been particularly effective in stimulating economic growth.”
As Demba Moussa Dembele of the Forum for African Alternatives in Senegal has pointed out, the experience of the credit crunch has been that state intervention is vital to lessen the impact of the crisis.
But this hasn’t stopped the WTO pushing for a reduction in state intervention in poorer countries.
The free market insistence on growing cash crops has left African countries increasingly vulnerable to fluctuations in the world market.
Mani explained, “In general agriculture is collapsing. Much of this is due to the way Africa is forced to rely on exporting products to make money.
“But we are told that governments must maintain foreign trade and foreign revenue, and that they must fight inflation and cut public sector wages.”
In its report Death and Taxes, the charity Christian Aid shows how Africa is losing nearly £110 billion each year as a result of lack of enforcement of agreements with foreign companies investing in various sectors, especially in the mining industry.
Mani said, “The rich Western governments operate with double standards. Some get to print more money, the so called ‘quantitative easing’, while others are tightly squeezed. And it’s the African poor getting squeezed.
“Look at Ghana. Between August 2007 and August 2008 the number of families that could afford one nourishing meal a day fell from 65 percent of the population to 41 percent.
“African economies are hit again because many are reliant on one or two commodities. For instance Zambia is suffering because of the falling copper price on the world markets. But the rule applies across the continent.
“The key thing is how ordinary people respond. The recession is already sparking political unrest.
“In Ghana we have seen an increase in public sector wages, but now the government is trying to renege on the deal. This is what the G20 leaders want.
“Instability is on the increase, as with the power struggles in countries such as Guinea or Madagascar. But anger can go in different directions.
“That is why we need socialists who can offer critical thinking and organisational effort.”
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