Global Policy Forum

By Alex Kirby

Rich countries are helping to make corruption worse in the developing world, says British charity Christian Aid. It argues strongly for the cancellation of the debts of poor countries, which it says rob governments of money to satisfy basic human needs. It recognises that corruption in developing countries can undermine the case for debt relief, because of the fear that money from cancelled debts will end up in private hands. So the charity has published a report, Curbing corruption: A people's approach to debt relief.

It says the report shows how "contrary to the image many hold of poor countries, people living in poverty are themselves confronting corruption". And Christian Aid says that "current terms and conditions demanded by institutions such as the International Monetary Fund in return for aid and debt relief are making corruption worse". This, it says, is because the IMF and the World Bank exacerbate poverty by requiring governments to cut public spending, driving many people into petty corruption.

The report says corruption is not limited to developing countries. In 1996, it says, German companies paid more than $3bn in bribes to win contracts abroad. And it says attempts by donor governments to check on how money is spent can never work as well as local scrutiny.

"In the long run, it is active 'watchdog' parliaments, representing the people who elected them, who offer the best safeguard against abuses of power and wastes of money." The report also calls for the creation in all the poorest countries of national debt relief committees. They would be responsible for seeing that the money from debt cancellation was applied to the fight against poverty.

"Some of the money from debt relief, perhaps between 5 and 10%, should be specifically earmarked to fund the committee and train local people to monitor it - good democracy costs money."

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