New Internationalist

New debt tsunami as crisis hits South

It's taking a while to assess the damage the rich-world spawned economic crisis is causing in the global south.

News is patchy - especially from the poorer, less reported places.

But Jubilee Debt Campaign is warning that a new debt tsunami is about to hit the South - similar to that which engulfed economies in the 1980s.

At least 38 of world’s most vulnerable countries risk spiralling debts due to financial crisis, it maintains. And Gordon Brown's proposals for a new World Bank Fund to help poorer countries will only add to their debt burden.

The report focuses on three countries - Zambia, the Philippines, and Bangladesh - that are facing deep trouble.

The three are heavily dependent on exports and /or remittances from nationals working abroad. All have large debt burdens - even before the crisis.

Export markets are shrinking - and in the case of the Philippines especially - the flow of remittances from nationals working abroad is slowing down dramatically. In Zambia, the slump in copper prices has led to a debt-to-export ratio of 300 per cent. While Bangladeshi, is almost entirely dependent on the export of textiles.

Jubilee Debt Campaign is calling for cancellation of old debts and for a radically new international lending system.

You can read the report in full on http://www.jubileedebtcampaign.org.uk/

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About the author

Vanessa Baird a New Internationalist contributor

Vanessa Baird lived and worked as a journalist in Peru during the tumultuous mid-1980s, and she maintains a passionate interest in South America. She joined New Internationalist as a co-editor in 1986 and since then has written on everything from migration, money, religion and equality to indigenous activism, climate change, feminism and global LGBT rights. She also edits the Mixed Media, arts and culture section of the magazine.

Vanessa’s books include The No-Nonsense Guide to World Population (2011), Sex, Love and Homophobia (2004), The Little Book of Big Ideas (2009) and, People First Economics (2010). In 2012 she won a prestigious Amnesty International Human Rights Media award.

Read more by Vanessa Baird

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