The boss of the World Bank has rightly warned of a “human catastrophe” if rich countries cut back on their aid to the developing world. Speaking at the end of his bank’s spring meeting, held in parallel with sister organization, the International Monetary Fund, Robert Zoellick is quite right to have cautioned against any reduction in this crucial aid.
His comments were probably informed by the fact that many politicians and finance officials who had gathered in Washington were clearly far more concerned with their own domestic problems. The broad picture does not look good. In past and clearly more minor recessions, some countries have cut back their unilateral overseas development aid by over 60 percent. The pressure on government purses in this recession is far greater. In the face of falling tax receipts and rising borrowing, which will have to be paid back in years to come, slashing foreign aid is an easy option.
But such a policy does not stack up, either morally or economically. The moral argument is plain. For every one percent decline in the gross domestic product of the developing world, it has been calculated that some 20 million more people are plunged into poverty. The economic argument is often overlooked. When this recession ends, as inevitably it will, the speed of recovery will depend on Third World markets just as much as among rich nations. If poor countries have been pulverized by the downturn, with nascent industries collapsed, entrepreneurs bankrupted and those ordinary workers and farmers least able to defend themselves and their families, plunged even further into misery and debt, they will not be able to help fuel recovery. Indeed from poverty and despair may have arisen political instability and crime, which could imperil whole regions and challenge the First World. Somalia and its pirates and the Eastern Congo already demonstrate the horrors that could arise.
And there is another dimension to the abandonment of developing countries — the shedding of their workers who have traveled overseas to find employment. It is axiomatic that any government must look after its own jobless first. But foreign labor cannot be a tap that is turned off as readily as it is turned on. Societies that have benefited from overseas labor surely owe these people more. Of course, they must go home but is it right, as has happened to Bangladeshis this week, that they are deported immediately after the Malaysian factory in which they worked went bust?
One reason why such treatment is so painful are the vast sums of money recruiters charge, quite illegally, for finding overseas employment for Third World workers. One positive move now, which will at least have long-term benefit, will be for countries around the world, including in the Gulf, to crack down on these middlemen. Recruitment should be done directly through governments or via bona fide and regularly checked employment agencies who do not dupe and further pauperize workers seeking overseas jobs. Enmeshing helpless individuals in a web of debt is little short of slavery and no civilized country should stand for it.
No such thing as a free lunch
Instead of demands and naysaying, which will be met by American opposition, Prime Minister Benjamin Netanyahu should convey a clear commitment to the two-state solution, support the Arab peace initiative as the basis of a regional agreement, halt settlement expansion and engage in efforts to strengthen the Palestinian economy, said the Israeli daily Haaretz in an editorial yesterday. Excerpts:
Netanyahu is busy developing his policy proposals before his upcoming White House meeting with President Barack Obama. From statements that the Israeli premier has made, it is apparent that he is seeking to bring to a halt the peace process that his predecessors pursued, which aimed at the establishment of a Palestinian state in the territories and reaching a peace agreement with Syria.
Instead, Netanyahu is posing a series of demands that he will present to Obama: Priority for the threat from Iran, Palestinian recognition of Israel as the state of the Jewish people, continued construction in Jewish settlements and refusal to withdraw from the Golan Heights. This is provoking opposition in the international community. Obama and senior officials in his administration have reiterated their commitment to a “two-state solution.” In the European Union, there are calls to freeze the upgrading of relations with Israel if the country retreats from prior commitments.
The prime minister is of the opinion that Israel currently has an unprecedented political window of opportunity arising from concern among Arab states over the threat from Iran, which will lead them to strategic cooperation with Israel. However, the international community, headed by President Obama, expects Netanyahu to continue to pursue the peace process that he inherited from Ehud Olmert, to freeze construction in the settlements and to ease living conditions for Palestinians in the West Bank and the Gaza Strip.
