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The Third World's Odious Debt
The South makes compelling moral arguments to cancel its foreign debts. But, it also has an indisputable legal case because the overwhelming majority of those debts are odious in law.
"If a despotic power incurs a debt not for the needs or in the interest of the State, but to strengthen its despotic regime, to repress the population that fights against it, etc., this debt is odious for the population of all the State."
- Alexander Sack, 1927
In 1927, Alexander Sack the world's pre-eminent legal scholar on public debts, defined the Doctrine of Odious Debts, which remains the ultimate legal source on that subject. The Doctrine of Odious Debts, though now 70 years old, helps bring clarity to today's complicated Third World debt situation, and fairness to a tragedy in which innocent Southern citizens pay, and corrupt and negligent borrowers and lenders get away scot-free.

News articles - Pakistan

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Daily Times (Pakistan)   December 8/2005

Despotism and corruption in Africa: editorial   by Razi Azmi

Fortunately, Pakistan has not descended to the level where the face of our president or prime minister, whether elected, semi-elected or un-elected, would appear on our currency notes, yet many of our problems, political, social and economic, may be attributed to the persistence of the clan mentality (biradari) and tribalism, as in Africa.

"Our leaders are corrupt, greedy and selfish men. They siphon our money into their bank accounts – and look, our education system is zero; our roads zero; our hospitals, zero." The reader may be excused for thinking that these are the words of an ordinary, angry Pakistani. But they are Jide Kwaku's, a citizen of Nigeria, the world's sixth largest oil exporter.

According to figures recently compiled by Nigeria's anti-corruption commission, Nigeria's past rulers stole or misused $500 billion. The amount equals the total Western aid to Africa for almost four decades.

The governor of Nigeria's Bayelsa state, Diepreye Alamieyeseigha, was arrested at Heathrow Airport in September on three money-laundering charges after police found £1 million in cash at his London address and property worth £10 million in his name. He jumped bail and fled to Nigeria on a false passport, dressed as a woman. In his home state, he was welcomed as a folk hero and is now back in his gubernatorial post.

This year President Olusegun Obasanjo has dismissed two cabinet ministers and the national police chief, accusing them of misusing huge sums of public money, a euphemism for corruption.

Nigeria, in West Africa, has been in the grip of systematic and institutionalised plunder for decades. But Zimbabwe, in the southern part of the continent, has been destroyed in the course of a few years through a combination of despotism and corruption aggravated by tribalism and racism.

Earlier this year, Mugabe's government bulldozed dwellings and businesses in shanty towns, rendering 700,000 people homeless and without any means of income, apparently to clean up the cities, but really to teach them a lesson for voting for the opposition Movement for Democratic Change (MDC).

A couple of weeks ago, Air Zimbabwe had to ground its entire fleet for lack of petrol. Not that the grounding affected many aircraft, for the national airline is now left with only seven planes (including two small ones bought from China recently), down from the 15 it inherited at the time of independence from Britain in 1980. The airline earlier made history by flying an inaugural flight from Dubai to the capital, Harare, with just one passenger!

The 81-year old Robert Mugabe has wrecked one of Africa's most promising economies through his egotistical policies, including seizures and redistribution of white-owned farms to his black supporters and cronies. But if you heard him speak, you would think he is an African or Third World visionary fighting Anglo-American neo-colonialism!

Mugabe has destroyed even the Zimbabwe cricket team. His first victims were the white players, but now even their newly appointed black captain, the talented Tatenda Taibu, has quit in disgust.

At the time of independence, both Nigeria and Zimbabwe were not only self-sufficient in food, but were net exporters. Now, Nigeria imports food, and Zimbabwe is in the grip of a man-made famine.

Some years ago, in 1998, Thabo Mbeki, the then deputy president of South Africa, admitted that many government posts were held by people who took their jobs with the sole intention of stealing.

In East Africa, Kenya just held a free and fair referendum, a first for Africa. Exactly three years ago, Mwai Kibaki had defeated Uhuru Kenyatta in an election, a rare event in Africa. Kenyatta was the hand-picked candidate of Daniel Arap Moi, president since 1978, who was constitutionally barred under public pressure from contesting. Here, too, the early hopes seem to have been dashed. The constitutional referendum is seen as a spectacular betrayal by the government of Mr Kibaki.

When he came to power in December 2002 on a tide of popular and cross-party support, promising reform and the end of corrupt rule, Kibaki had inherited from his predecessor almost dictatorial powers. At the time, he supported a new constitution that would cede some power to a prime minister he more or less promised would be Raila Odinga, a leading opposition figure who did more than anyone to help him win the presidency.

Once in office, however, Mr Kibaki and his ministers – mostly from his Kikuyu ethnic group – went back on their word. A draft constitution that would have diluted the president’s power has been mutilated by his government, enabling its members to preserve their newly won powers of patronage.

They are determined to prevent Mr Odinga, who is minister of Roads and Public Works and is not a Kikuyu but a Luo, from gaining power, and dismissed the idea of an elected prime minister. Kikuyu and Luo are Kenya's two largest tribes.

In neighbouring Uganda, the hopes associated with President Yoweri Museveni have been dashed and the country is descending down the path of despotism. When Museveni took power in Uganda in 1986, he was welcomed by all and sundry in the hope that he would heal the wounds inflicted on Ugandan body politic and economy by the deposed dictator Idi Amin.

The opposition leader Kizza Besigye of the Forum for Democratic Change (FDC) was arrested on treason charges soon after returning from a four-year exile in South Africa, hoping to contest the presidential elections due in March. He was bailed out by a high court judge, but was sent back to prison to face a court martial.

Besigye and 22 of his alleged accomplices are facing a military court on charges of terrorism and weapons offences. Uganda's army says anyone caught with arms, ammunition or equipment "ordinarily being the monopoly of the defence forces" is liable to be tried by a military judge.

Besigye was Museveni's personal physician during a five-year insurgency that the latter led before coming to power in 1986. Having finished second in the 2001 presidential elections, Besigye fled Uganda saying he feared for his life. Museveni had threatened him with arrest.

Clan mentality and tribalism, besides breeding nepotism and cronyism, brook no opposition. In the mid-1980s a visiting Tanzanian friend in the United States, on inspecting a Pakistani 100-rupee note lying on the table, asked me whose visage was on it. Since it bore no resemblance to President Zia ul Haq, he wondered who it was.

I explained to him that all our currency notes bore only the visage of Mohammed Ali Jinnah, the founder of the country. Pleasantly surprised, he went on to tell me that in Africa it was common practice for a new ruler to issue new currency notes bearing his own visage and pull out of circulation old ones.

In a tribal dispensation, where the head of government views himself as a tribal chief of sorts demanding complete loyalty, a loss of face is not just a metaphor! Such a mentality brooks no opposition and is uncomfortable with a leader of the opposition.

Fortunately, Pakistan has not descended to the level where the face of our president or prime minister, whether elected, semi-elected or un-elected, would appear on our currency notes, yet many of our problems, political, social and economic, may be attributed to the persistence of the clan mentality (biradari) and tribalism, as in Africa.



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