All third world debt should be dropped
Over the past decade many countries in what we know as the 'third world' have borrowed huge sums of money from wealthier countries in times of strife. Do these debts now hanging like nooses around countries necks? Are they preventing economic expansion and ultimately wealthier populations?
Please cast your vote after you've read the arguments.
You can also add to the debate by leaving a comment at the end of the page.
The loans are preventing economic stability
With countries struggling to pay back the loans they are not attending to their economies with enough care. This leads to recession/inflation which adversely affects the population.
The loans are only a tiny part of the economic problems faced by third world countries, and no-one knows what effect (if any) the dropping of the debts will have. if the loans were dropped the countries may actually have MORE economic problems because the 'First World' countries are not keeping an eye on them.
The loans are accruing interest quicker than they can be paid off
they should negotiate
The countries knew the interest rate when the signed up. It is their responsibility to pay back the loans, just as in private financial arrangements between individuals and banks.
'First World' countries don't need the money
It is clear to see that the countries to whom the debts are owed do not need the money, and that it could be better spent on proving a better standard of life for the citizens of the debtor country.
Really you'd let people die on a matter of principle.
This is not the point. The countries signed for the loans and should now repay them. It's a matter of principle.
The repayment of the loans is being passed on to the citizens in taxes
The population of the debtor countries are suffering because of the debts. The debts mean higher taxes, less money spent on public services and an unstable economy.
These debts are not the only reason for these, and in fact no-one knows how much the debts contribute to these problems.
All the world religions together have MORE than enough money to cancel all world debt and poverty, the government doesn't even have to do anything. The churches need to practice what they preach, take a step of faith and do what their doctrines tell them to and give up their money for the greater good, instead of handing out small amounts and not really getting anywhere.
This point isn't really relevant to whether third world debt should be dropped or not. I agree that religions should be using all their money to help people, but why not focus on corporations? They have billions and billions of pounds that lines the pockets of already rich businessmen and women- why not demand that they pay off world debt and get rid of poverty? So yes, the money is there to cancel out third world debt, but that doesn't resolve the question of whether we should or not and whether to allow future repayable loans.
The citizens shouldn't suffer because of what the government has signed them up for.
It is irrelevant that the governments of the debtor countries may have known what they were signing up for. The citizens of said countries, the ones who are suffering most, didn't have a say in the decision.
And neither do we have a decision over the extortionate taxes WE pay, so why give it away to others countries. How many £mil' did the africans pay for an unnecesary world cup stadium for the world cup ?, and as soon as the event is over start pleading for money for water aid again. With that money they wasted they could have sunk 100s of wells and desalination plants...Water problem alleviated. from the 60s WE(the taxpayer) have been providing condoms to these countries to avoid babies being born to the harsh environments,
after all it is extremely cruel to bring a child into the world in those conditions. It made no difference. My wife and I used to decide when we could afford to have another child as many did, and increase our families as and when we could afford to do so. Unlike today bang them out and let somebody else pay for them. Sheer waste of money and childrens lives.
While these countries are in debt, they are under foreign control
Money is not lent to third world countries unconditionally- it is lent under conditions such as the implementation of structural adjustment plans, forcing governments to accept privatisation of national industries such as water. This often results in a situation where the price of essential things such as water increases massively so the citizens can't afford to pay and end up living in worse poverty than before. A non-repayable loan, still with conditions relating to democracy etc (although the IMF and world bank have often lent money to military dictatorships, such as that of Argentina 1976-1983) would free third world countries from constraints such as privatisation and allow their economy to develop in a way that would benefit its citizens rather than foreign companies such as those selling water.
The debtor countries knew what they were signing up for when they took the loan
The governments of the debtor countries knew exactly what they were signing up for when the took out the loans! Why should the loans be dropped just because they are struggling to pay? A bank wouldn't drop a customer's debt if they were unable to pay!
Surely the richer countries should be looking to help out the poorer ones? The world is growing smaller with live worldwide news coverage and international travel becoming easier. Surely in these global times we can't stand by and let the poorer nations suffer?
Dropping the debts will not help the population because of corruption
If the debts were dropped the money saved would just line the pockets of the already corrupt politicians and would not filter down to the general population. A much better way to help the populations is through direct humanitarian aid.
This is fairly evidently empirically false and logically flawed. On the contrary, cancelling debt removes the need to pay future money – money which is raised by politicians from taxes from the general population. Cancelling debt removes the demand for that money, so taxes need not be as high, benefiting the general populace. Humanitarian aid, on the other hand, is a transfer of money into the country, as such it can actively be stolen by those in the distribution network who are corrupt. Money that starts with the population and has to be taxed from them is evidently less vulnerable to theft that money that starts (on entering the countries) with the elites in the country’s distribution networks and may never reach the population in the first place.
Dropping the debts may encourage the debtors to purposely take out loans that they cannot repay
If the dropping of the debts was announced then the countries would immediately take out new loans that they couldn’t repay, knowing that the debt would be dropped. They may also start defaulting on loan repayments until the debts were dropped.
It wouldn't be necessary for them to do this if the world economy didn't discriminate against poorer, relatively under-developed countries in the way that it does.
We should drop third world loans and instead offer non-repayable support, meanwhile working to make the global economic system fairer for everyone.
What do you think?