THE outgoing Country Director of World Bank (WB), Mr Peter Harrold, has said the Heavily Indebted Poor Countries (HIPC) initiative is not a sign of Africa?s failure but the inappropriate response of donors to the continent's economic problems.
"Terms of lending and interest rates of loans are inappropriate. They are founded on false assumptions."
Mr Harrold was interacting with 50 MPs at a parliamentary retreat aimed at upgrading the knowledge of the legislators on national economic and financial policies and programmes.
He said:" We did not pause to count how much was flowing out as repayments. We were just concerned with what was coming into the poor nations. In fact, the net inflow was very low."
He said the HIPC initiative has suffered a lot of attacks in Ghana, while other African states scramble for it.
"It is the pride that Ghanaians have. Supposing we called it Debt Reduction Programme for Africa, would it be okay?"
According to him," if HIPC would not do much at all, it would at least give governments much control on the use of resources, which could have gone into repayment of loans.
Mr Harrold said Ghana's choice for the initiative stemmed from the fact that it was regular at repaying loans, adding, "the G8 sees it as a reward for countries who have performed better economically."
On the question of total debt cancellation, he said indebted countries have not convinced the rich nations and other donors enough on the need for cancellation of debts."
"Maybe we could use the difficult access to European markets or the American Farm subsidy programme and other policies to make a good case." He condemned the idea of donors using clauses of "marching funds or counterpart funding" to site projects in poor nations.
Mr Harrold said such a clause demands that donor projects are more important than government projects.
He confirmed Mr Moses Asaga's (NDC, Nabdam), assertion that donors no longer insist on privatisation of utilities as a conditionality of HIPC.
The Sri-Lanka bound WB official asked that Parliament should be involved in initial stages of planning of economic programmes.
"Parliament is seriously under-consulted. We need to build into our rules of engagement the element of constant consultation on issues," he said.
THE outgoing Country Director of World Bank (WB), Mr Peter Harrold, has said the Heavily Indebted Poor Countries (HIPC) initiative is not a sign of Africa?s failure but the inappropriate response of donors to the continent's economic problems.
"Terms of lending and interest rates of loans are inappropriate. They are founded on false assumptions."
Mr Harrold was interacting with 50 MPs at a parliamentary retreat aimed at upgrading the knowledge of the legislators on national economic and financial policies and programmes.
He said:" We did not pause to count how much was flowing out as repayments. We were just concerned with what was coming into the poor nations. In fact, the net inflow was very low."
He said the HIPC initiative has suffered a lot of attacks in Ghana, while other African states scramble for it.
"It is the pride that Ghanaians have. Supposing we called it Debt Reduction Programme for Africa, would it be okay?"
According to him," if HIPC would not do much at all, it would at least give governments much control on the use of resources, which could have gone into repayment of loans.
Mr Harrold said Ghana's choice for the initiative stemmed from the fact that it was regular at repaying loans, adding, "the G8 sees it as a reward for countries who have performed better economically."
On the question of total debt cancellation, he said indebted countries have not convinced the rich nations and other donors enough on the need for cancellation of debts."
"Maybe we could use the difficult access to European markets or the American Farm subsidy programme and other policies to make a good case." He condemned the idea of donors using clauses of "marching funds or counterpart funding" to site projects in poor nations.
Mr Harrold said such a clause demands that donor projects are more important than government projects.
He confirmed Mr Moses Asaga's (NDC, Nabdam), assertion that donors no longer insist on privatisation of utilities as a conditionality of HIPC.
The Sri-Lanka bound WB official asked that Parliament should be involved in initial stages of planning of economic programmes.
"Parliament is seriously under-consulted. We need to build into our rules of engagement the element of constant consultation on issues," he said.
