In order to catch up with the fast growing progress of the developed countries’ economy, a lot of developing countries choose to use debt to accelerate the development of their economy. But who else can know this is a way that Western countries use debt to control the economy of the poor countries or developing countries. (Global) The debt crisis has spread across Africa in the last decade and the reasons that gave rise to excessive African indebtedness in the 1970s and early 1980s, and which caused it to balloon from $140 billion when the crisis emerged in 1982 to over $270 billion in 1990, has been amply documented elsewhere. Revisited) Global apartheid, also is one of the reasons that caused African debt crisis. Global apartheid manifests itself in many different ways. Its attributes go beyond racial discrimination to include the use of unfair trade, the debt crisis, gender inequality, and religious and political intolerance as a way of enshrining its perpetuation. Also, an obvious situation about poverty in Africa can be seen from ‘The ten poorest countries Of The World’. All of them are from Africa. (Top poorest) African people think debt is an easy way to get money and help their economic development.
However, they never think about the debt will burden their economy. African debt is a double-edged sword that is used by most of the African countries. Though it is a speedy way to get away from poverty, it can hurt the economy a lot even the economy will be much worse than before. In order to know how to help Africa get rid of debt crisis, people should know its causes, scale, impact and solution. This will let people do their best to help Africa. When people heard this astonished truth, they always curious about what exactly causes the African debt crisis to happen.
Causes of the African debt crisis can be easy to divide in three parts: a continuing legacy of colonialism, global apartheid and mismanaged lending. The colonisation of Africa has a long history, the most famous phase being the European scramble for Africa during the late 19th and early 20th century. (Textbook) During this time, colonizers were doing the slave trade and establish the company. They borrowed money from outside of Africa. And this is how debt start in Africa. After the decolonization of Africa, a lot of newly formed states appeared.
Nevertheless, before these newly formed states had even had time to organize their economies and get them up and running, new debtors were already saddled with a heavy burden of debt. These new formed states did not have enough money to pay for the debt. So they borrowed the money to pay for the debt, as well they were going to extreme poverty and the debt crisis. Global apartheid, which uses debt as a form of bondage, fuels cycles of poverty and plagues many impoverished countries in Africa. In apartheid South Africa, the white minority had the final say over all matters, using different rules for different races and colors.
Today, the West ultimately has the final say in the majority of Africa’s issues and policies, utilizing the continents $300 billion dollar debt as the mechanism by which to impose its dominance. When poor countries become deeply indebted, they fall into an abyss of economic degradation. It is not just the debt that is an issue for poor countries; it is the harsh conditions that come with it, that for years, have been known to make things worse, not better. The scale of African debt crisis is becoming bigger and bigger. It affects people’s lives, food production and also it increases the death rate.
In 1970, the world’s poorest countries (roughly 60 countries classified as low-income by the World Bank), owed $25 billion in debt. By 2002, this was $523 billion for Africa. In 1970, it was just under $11 billion by 2002. (Shah, The Scale) The scale of African debt crisis is not only becoming bigger in economy part, but also the quality of lives. Extrapolating from UNICEF data, as many as 5,000,000 children and vulnerable adults may have lost their lives in sub-Sharan Africa as a result of the debt crunch since the late 1980s.
Some 11 million children die each year around the world, not just Africa, due to similar conditions of poverty and debt. (Shah, The Scale) The impact of the debt crisis is suffered by the people in Africa. The death of children and the amount of diseases keep increasing due to the debt crisis. The main problem of the debt crisis in Africa is people don’t have sufficient money to buy food or develop agriculture. Africa is affected by the debt crisis in vulnerable population, extreme poverty and managed by Western countries.
Since 1975, while over $12 billion was accumulated in payments arrears, twenty-two African nations were forced to reschedule their debt on eighty-five separate occasions in what has constituted an almost continuous exercise with London Club private creditors. These creditors don’t care about people lives in Africa. They only care about how much money they can get back. Consequently, according to UNICEF, over 1,000 people are dying each day in Africa. Fifty-six infant and child deaths are increasing yearly, and projected again, by UNICEF to total 50 million between 1985 and 2000. Revisited) That is why Africa has a very high death rate. Children cannot have enough food to eat or any clean food. Because there is no clean food and clean water resource. The diseases in this situation are easy to spread. Many people get sick from eating dirty food and not healthy water. People in Africa have a very high tax because the government wants to use this money to pay for the debt as soon as possible in this way. People and government don’t have enough money to improve their basic needs. Like in the technology of agriculture, the clean water system and health care.
This is also a core problem to cause a high death rate. On the other hand, debt crisis is global apartheid in one way. Africa states don’t have money and they expect some rich countries can help them get away from poverty. They need investment to create job and push the process of GDP. As well, this is the best way that western countries can utilize their low paid employment. These western countries use the money to use a cheaper resource and control the progress of the African states. (Global) African states are suffering right now.
People who from the world should help Africa get away from poverty and develop their countries. There are three aspects of solution that people can use to help Africa. The first one is doing nothing, let them grow spontaneously; the second one is to reconstitute Structural Adjustment Reform (SAR) policies; the third one is to cancel partial African debt. Doing nothing, means don’t let Western countries use too many African resources and control their economies. African states still need western countries’ investment. It needs the West to create jobs and money for itself.
It cannot refuse Western countries. The second solution is to reconstitute Structural Adjustment Reform (SAR) policies. The Third World debt crisis of the 1970s prompted organizations, such as the IMF and the World Bank, to reform their policies on lending. Instead of having project or program based lending these institutions slowly switched over a period of 20 years to a policy based lending program known around the world as Structural Adjustment Reform. These SAR policies were aimed at balancing state budgets and promoting economic growth. Moseley) A third solution is to cancel partial African debt. Also, this solution is the most effective and fastest way to help African countries. Much of Africa’s debt lies in paying back interest and not paying back the actual principle (or amt borrowed). (Moseley) By eliminating or reducing this interest debt, it is theorized that poorer indebted countries would have an easier time repaying what was principally owed. The African debt crisis, as one of the most intractable problems of the economy in Africa, and has affected Africa for a long time.
This caused most of the African countries get into extreme poverty. The lacking food, the increasing death rate and diseases are all part of impact of the debt crisis. Debt crisis makes Africa become a slave and western countries can be easy to control its economy. Nonetheless, their people are suffering. People should help Africa get away from poverty and let Africa have the ability to develop its own economy. To figure out the debt crisis this problem is a big help for Africa. This can help Africa have enough money to develop its agriculture, health care and education. Debt is a dangerous tool.
It can help get out of poverty or make the situation much worse than before. Africa needs to use the money to develop its economy step by step. This will be a good way to save people whose life is still suffering in Africa. (Global) “Global Apartheid and the African Debt Crisis. ” Africa News Service. 5 Jan. 2005. Global Reference on the Environment, Energy, and Natural Resources. Web. 1 Mar. 2012. (Shah Causes) Shah, Anup. “Causes of the Debt Crisis. ” Global Issues. 03 Jun. 2007. Web. 14 Mar. 2012. . (Shah, The Scale) Shah, Anup. “The Scale of the Debt Crisis. Global Issues. 02 July 2005. Web. 16 Mar. 2012. . (Moseley) Moseley,William G. “African Debt Crisis. ” The World Bank Website, 2007. Web. 16 Mar. 2012. . (Revisited) “African Debt Revisited: Procrastination or Progress. ” Ed. Jan Joost Teunissen. FONDAD, 1992. Web. . (Top poorest) “10 Poorest Countries In The World 2011 a?? The Richest People In The World 2012. ” 10 Poorest Countries In The World 2011 a?? The Richest People In The World 2012. 23 July 2011. Web. 07 Apr. 2012. . (Textbook) “Unit Two: Studying Africa through the Social Studies. ” Exploring Africa. Web. 08 Apr. 2012. .
