Global Policy Forum

Charles Mutasa*

Global apartheid, like globalization, is a buzzword that has evolved to describe a new global paradigm. Put simply, global apartheid is an international system of minority rule that promotes inequalities, disparities and differential access to basic human rights, wealth and power. Global apartheid is the opposite of global democracy. People like South Africa's president Thabo Mbeki, Fidel Castro of Cuba and the scholars Ali Mazrui, Richard Falk, and Patrick Bond, among many others, have used this concept in an effort to describe the global or economic injustice of our time.

Current manifestations of global apartheid are exhibited in the dominance of bilateralism and the hegemonic behaviour of the United States, the unbalanced and undemocratic processes in the World Trade Organization (WTO), and the disproportionate power of multinational corporations and the Washington-based International Financial Institutions (IFIs).

In today's world apartheid is reflected in 'who gets what, when and how?' in the global system. Global apartheid offers explanations for the North-South polarization, the peripherization of Africa, the breakdown of WTO trade talks in Seattle (1999) and Cancún (2003), terrorism, endless conflicts and wars, problems with the free movement of labour between the South and the North, increased wealth in rich countries while resources are drained from poor countries, as well as the denial of life saving medicines and care for people living with AIDS.

Debt and Global Apartheid

Debt oppresses poor countries and it has taken on proportions so as to render its repayment almost impossible. The debt has become a self-perpetuating vicious circle where new loans are taken to pay off the interest on standing ones. It is clearer than ever that the debt is not an economic problem, but a political one, and it is as such that it must be resolved.

Global apartheid through the bondage of debt fuels cycles of poverty and plagues many poor countries in Africa. The debt issue is no longer confined to the economic and financial spheres; as is demonstrated through the application of conditionalities attached to loans and debt relief. These conditionalities were historically introduced through World Bank structural adjustment programmes (SAPs) that were 'designed to rescue debtors', but were in reality driven by the desire to assure that ailing debtor economies did everything possible to pay back their debts.

Like apartheid in South Africa, SAPs entrenched great disparities in wealth, living conditions, life expectancy and eroded national sovereignty in the majority of Sub-Saharan Africa. The introduction of conditionalities such as higher user fees in public facilities, subsidy cuts and lowering of budgetary allocations to social services has resulted in increased poverty and unemployment.

In fuelling global apartheid, the IMF and World Bank have special functions to play: they police and facilitate global apartheid while they simultaneously assist governments in adapting to the process of globalisation, helping them cushion the impacts of these policies felt by the poor. One chief economist was quoted saying "it is important to send the "ambulances" (social programs) after the "tanks" (SAPs) have rolled through a country." If a government strays from the path of globalisation the 'seal of approval' to borrow from public and private creditors is withdrawn by IMF and World Bank, causing the governments' sources of credit to eventually dry up.

Countries that implemented SAPs became accustomed to operating under an 'external policy command', which discourages national dialogue on societal reform. This process has destroyed the 'social contract' fundamental to ensuring government policies work effectively. Like former apartheid policies in South Africa, SAPs have been imposed upon the marginalized and materially deprived citizens of the Global South, eroding the capacity to develop their own development programs.

Debt has eroded the hard earned independence of African states. A crushing debt burden hampers poverty reduction and constrains development. Africa's debt crisis absorbs resources and energies that should be used to tackle urgent social problems.

Oloko Onyango's 1993 study of Uganda reveals that technocrats in the Ministry of Planning drew up national budgets that had to be endorsed by donors before their own parliament examined them. But even then, parliament merely acted as a rubber-stamp. Since the introduction of SAPs as a way of resolving the debt crisis, independent policy-making and national economic management has diminished and narrowed considerably. Like in apartheid South Africa, in which blacks had no say in the rules that governed their country, global apartheid strips autonomy from the state and its people.

International Financial Institutions continue to put pressure on African development through their conditionalities, using development aid and loans as a lever to impose the neo-liberal paradigm of privatisation and deregulation, liberalization and increased interest rates to control inflation. Under the newer Poverty Reduction Strategy Papers (PRSPs), set up to replace the old SAPs, they impose the same neo-liberal framework through the Poverty Reduction and Growth Facility (PRGF).

Studies done by AFRODAD on the PRSP process demonstrate how the IMF and the World Bank imposed their macro-economic framework on the process. This meant that the PRSPs could not be reshaped at the level of macro-economic policy as the framework was already fixed. Thus the link between PRSP and SAPs is a continued imposition of the neo-liberal macro-economic framework. Segregation in policy formulation and standards of living was a key feature of the apartheid system in South Africa. This is reflected in the current global apartheid paradigm with unrealistic IFI conditionalities, stifling African development goals, especially when now-developed countries in the North used the very strategies now prohibited for their own development process.

Many development agencies and skeptics have expressed widespread doubts regarding the Heavily Indebted Poor Countries Initiative (HIPC) launched in 1996 to achieve the promised objective of a "robust exit from the burden of unsustainable debts" for developing countries. Problems associated with the design and implementation of the initiative suggest that the HIPC initiative has not succeeded in providing adequate response to the Third World's debt overhang. The segregated and selective nature of apartheid is also seen in HIPC. It is interesting to observe that although Nigeria's debt stock is the largest in West Africa and the country is experiencing growing poverty, the country is not recognized as a HIPC eligible country simply because it produces oil.

Despite the many arguments against the conditionalities attached to multilateral lending and development assistance from bilateral donors, the conditions have intensified. It has become increasingly clear that there is a hidden agenda for control by those who propagate such conditionalities. This cannot be anything less than global apartheid. The whole process has been much slower than expected and the HIPC initiative is suffering from problems of under funding, excessive conditionality, inadequate debt relief and cumbersome procedures and eligibility restrictions. Creditors have not put sufficient political will, resources and serious analysis into the debt reduction operations.

Aid and Global Apartheid

Within global apartheid structures and systems, aid has always been connected to politics. During the Cold War, for example, investment flows, development efforts and humanitarian assistance tended to reflect the changing pattern of superpower alliance and competition. It has been pointed out that tying aid to politics translates into "choice less democracy." Thus, aid is a means of inducing policies and programs favourable to the donor countries, even though promoting economic performance of recipient countries is the given rationale for doing so. According to a World Bank report, "Aid can be the midwife of good policies."

Aid to developing nations has not always been targeted towards genuine economic development efforts. Rather, in most cases, it has been given as an instrument of control under the global apartheid system. The current aid regimes undermine governance at the national level and impose conditionalities that lead to human rights violations. Adding to this, it is reliably estimated that for every dollar given in official development aid, three go back to the rich countries in debt service payments. Under the auspice of mandating policies for the good of the countries, aid actually decreases the level of control the government has over domestic expenditure allocation (both domestic and external).

Conclusion

The world has enough resources for everyone if we find the political will to eradicate poverty and hunger as well as put human life before profits. The debt must be cancelled to free up resources for equal development in both the North and the South. Kofi Annan's 21st Century Action Plan speech summed up what it will take if we are to replace global apartheid with global democracy, when he said:

"I would go a step further and propose that, in future, we consider an entirely new approach to handling the debt problem. The main components of such an approach could include immediate cancellation of the debts owed by countries that have suffered major conflicts or natural disasters; expanding the number of countries in the HIPC scheme by allowing them to qualify on the grounds of poverty alone."

In the name of global democracy, the international community needs to negotiate new measures that go beyond existing initiatives in order to resolve Africa's debt crisis and end global apartheid. The debt is unpayable and rescheduling will only postpone the problem. The debt bondage is the new face of colonialism or even slavery. Debt is used as an instrument of domination. It is also an instrument used to plunder and exploit indebted countries' resources. Ultimately, debt is at the heart of the unequal power relations between the North and the South.

Recommendations

1. The total cancellation of third world illegitimate debts (as proposed for Iraq by the US) is a starting point in ending global apartheid.

2. There is an urgent need to address issues of unfair trade within the World Trade Organization.

3. Europe and the United States should stop using aid as a means of neo-colonialism or advancing their selfish ambitions.

4. There is a need to treat people of different geographical locations, race and origin equally when it comes to addressing global issues.

5. America's hegemonic wings need to be curtailed to ensure that it works within the framework of the United Nations.

6. The World Bank and the International Monetary Fund's role needs to be revisited and redesigned so as to make these institutions people centred and pro-poor in their economic development policies. There is need to put an end to the co-modification of human lives through imposition of neoliberal policies that value markets/ profits before people.

* About the Author: Charles Mutasa is Research and Policy Analyst at the African Forum and Network on Debt and Development (AFRODAD).

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