G7 would look at cancelling up to 100 percent of the debts owed to

G7 would look at cancelling up to 100 percent of the

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G7 would look at cancelling up to 100 percent of the debts owed to international institutions by the poorest countries on an individual basis.
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Copyright © 2007 The Ontario Educational Communications Authority. All rights reserved. Canadian and World Issues CGW4U-A Lesson 4, page 23 The miseries of places like Chiromo highlight the urgency of the task but also underscore a brutal fact: debt relief will be only one small step towards filling the chasm that exists between Africa and the rich world. “If people see electric lights here, it’s a novelty,” said Aloni as he washed dishes for his employer, a city businessman in Aloni’s home village of Chiromo on a camping trip. His meagre wages in the commercial capital Blantyre help to support his family in Chiromo who, like almost everybody else here, eke out an existence from fishing or subsistence farming. Malawi’s accumulated foreign debt—which is equal to about 154 percent of its gross domestic product (GDP)—has certainly not been spent here. Once a bustling trading town across the Ruo River from neighbouring Mozambique, Chiromo has sunk into squalid poverty. The former police station is now a roofless shell. Inside, it is overgrown with a riot of wild vegetation. Roads that were once paved are now sand-tracks full of potholes. Villagers living in simple brick or mud huts on the river banks have no electricity. Most are clothed in rags. Hand-hewn wooden canoes are the main mode of transport. People who bathe or wash clothes in the river because they have no running water run the risk of being eaten by crocodiles. These are scenes that can be repeated endlessly throughout the world’s poorest continent, where much of the money that has been borrowed—or simply thrown at governments as aid—has been squandered or stolen. Despite decades of aid and borrowing, Africa has grown steadily poorer, the income gap between places like Chiromo and the rest of the world steadily wider. The United Nations Development Programme (UNDP) says that sub-Saharan Africa’s per capita GDP—the economy’s annual output divided by the number of people—was $469 in 2002 compared with
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Lesson 4, page 24 Canadian and World Issues CGW4U-A Copyright © 2007 The Ontario Educational Communications Authority. All rights reserved. $22 987 for the affluent members of the Organisation for Economic Co-operation and Development. According to the World Bank, in 2003, gross national income in Malawi, a sun-drenched and fertile land that is once again confronted with food shortages, was only $160. Malawi’s foreign debt is crippling and any relief would be welcome. But much more than that needs to be done. “The most powerful tool toward closing the disparities between Africa and the rest of the world is market access. These countries must grow their export base,” said Robert Bunyi, Africa economist at South Africa’s Standard Bank. Boosting exports is easier said than done. Malawi’s government has made cotton and textiles the lynchpin of its development plan as it attempts to diversify
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