The repayment of Third World debt results in a net transfer of resources from struggling South to prosperous North. In 1998 Third World Countries put about $114.6 billion into the private and public coffers of the North. The 41 poorest countries paid $1.7 billion more than they received in aid. Since 1981, the South has transferred to the North $3.7 trillion, and yet today more that $200 billion is still owed.
Many countries have to borrow even more in order to repay interest and debt. Governments in the South have had to sacrifice their internal economies, abandoning health, education, employment, popular housing, land demarcation for indigenous peoples, agrarian reform and environmental protection in order to keep up payments. Natural resources have been squandered in the attempt to keep up interest payments. Most of the burden of repayment falls on agriculture, an agriculture struggling to survive already against the pressure of prices depressed by US (and other) subsidies.
Given the chance, farmers could compete internationally. Third World farmers as well as US and EU family farmers would benefit economically. Disease, overpopulation and poverty would be alleviated by increased domestic and foreign income. The annual income benefit for the developing world could be as much as $1.75 trillion if food prices found their natural unsubsidised level.
Subsidised burgers and chicken nuggets come at an awful cost.
State of the World 2002
Earthscan Worldwatch Institute
