Interview

VETERAN Belgian anti-poverty activist Eric Toussaint is wary that campaigners might be put off by the solemn-sounding title of his new book, The World Bank: A Critical Primer.

While it is certainly stuffed with official statistics and is meticulously referenced, the primer "isn't just for economists or students of economy.

"I want it to inform everyone who is fighting to make another world not only possible but actual," he says.

Toussaint, who was a senior official at the Belgian General Federation of Labour before setting up the Comite pour L'annulation de la Dette du Tiers-Monde (Committee for the Cancellation of Third World Debt), has recently been working as a member of Ecuador's recently established Commission for the Integral Audit of the Debt.

Visiting London to deliver lectures on the new left-wing governments in Latin America at the School of African and Asian Studies, he reports that he was shocked by what he uncovered on the commission.

"My book is based on official data published by the World Bank and the IMF, which is damning in itself, but, for the first time, I had access to internal paperwork on the types of loans and conditions that the World Bank imposed on Ecuador during the 1990s.

"We uncovered a staggering degree of interference in state policy. This supposedly politically impartial agency had granted loans with conditions which dramatically undermined the citizens' democratic right to use the state as a means to regulate foreign capital and implement socially just policies."

Ecuadorean President Rafael Correa has first-hand experience of World Bank meddling.

He was pressured to resign as Ecuador's Finance Minister in 2005 after World Bank chiefs took umbrage at his decision to reform the use of oil resources to fund social programmes, only to be elected president in 2006.

And, in January this year, Correa declared that Toussaint and the commission had uncovered "illegitimate" credits, which he vowed would not be repaid.

Correa has now pledged to stop all payments of "illegitimate" debt or credits on the basis that they were acquired under unfair terms by corrupt past administrations, the repayments having forced Ecuador to radically reduce social spending.

Toussaint argues that anti-poverty campaigners and progressive governments must learn from Correa's example and "seek to use the jurisprudence deriving from concepts such as odious debt in the interests of 'the peoples of the south.'

"Odious debt is a debt owed by a despotic regime which used loans to strengthen its control and dictatorship, rather than in the interests of citizens of that country," he says, urging that "the doctrine's origins lie in the US civil war.

"Then, the bankers of the north lent money to the slave-owning leaders of the southern states to prosecute their military campaign against the industrial capitalists of the north.

"When the north was victorious, the Boston bankers asked the new unified government to pay back the debt that had been incurred by the southern states, but the US government refused, insisting that it was an odious debt," Toussaint explains.

Fast-forwarding to April 7 2003, Toussaint observes that "the US treasury secretary convoked the G8 ministers of finance and declared that the debt incurred by Saddam's Ba'athist regime was an odious debt which should therefore be cancelled.

"But the Financial Times, acting as the mouthpiece for international finance capital, immediately launched a campaign calling on the G8 not to use the doctrine of odious debt, warning: 'If you do that, you would have to cancel the debts of Indonesia, Chile, Congo, Chad, South Africa, Rwanda, Philippines and on and on.'

"The US administration rapidly backpedalled on odious debt, claiming that Iraq was a unique issue," he says.

Toussaint points out that Bush's failure to achieve anything approximating a victory in Iraq and Afghanistan has given progressive movements in Latin America something of a breathing space.

But now, Washington is speaking with a new sense of urgency on political developments in what it still regards as its backyard.

In a speech to Congress on February 28, Bush warned Democrat leaders that, if they continued to reject the Colombia Free Trade Agreement, it "will sorely affect the national security interests of the US."

Bush ranted: "It will encourage false populism in our neighbourhood. It will undermine the standing of courageous leaders like President Uribe."

Venezuelan President Hugo Chavez responded by warning that Colombia is becoming "Latin America's Israel," days before Uribe sent troops across the border into Ecuador to massacre left-wing guerillas in their sleep.

Toussaint is confident that the citizens of indebted oppressed countries will not be cowed and will increasingly press their governments to follow the lead blazed by Fidel Castro and now taken by Correa, Chavez and Bolivia's Evo Morales.

"It is natural that, after decades of neoliberal shock therapy, more and more Third World countries are striving to change the rules of the game and reinvigorate the struggle for a new, just international economic order.

"Governments of the south have to launch offensives at the UN and call for the abolition of the IMF and the World Bank in favour of more equitable institutions such as the proposed Bank of the South," Toussaint declares.

"The IMF and the World Bank are unreformable," he says, but he insists that the same is not true of the UN.

"Progressive governments around the world must unite as they did in the 1960s and '70s in order to uphold the UN charter and demand real leadership from UN organisations to replace the catastrophe of US unilateralism," Toussaint concludes.

The World Bank: A Critical Primer is available from Pluto Press priced £16.99.