History of the world economy

NGOs Challenge U.S. Economic Dictates to Third World

By Jaya Dayal

UNITED NATIONS, Jan 18 (IPS) - A coalition of roughly 70 Southern and Northern non-governmental organisations (NGOs) Wednesday accused the United States of dictating a single economic vision to the Third World.

The coalition, called the Development Caucus, said that Washington's one-track economic thinking was sabotaging a draft action plan aimed at alleviating global poverty, unemployment and social ills.

The action plan, to be endorsed by world leaders at the Mar. 6- 12 World Summit for Social Development, is currently under discussion here by a 185-member nation U.N. committee.

''The United States is infusing the document with even more market language at a time when NGOs are trying to remove the bias towards a particular economic system,'' said Doug Hellinger of the Washington-based Development Gap.

He said that the U.S. insistence on markets and private enterprise as the means to social progress ran counter to the idea of the Summit which is ''to allow countries the flexibility to pursue alternative economic policies to achieve social development goals.''

F.R. Mahmood Hasan, of the Bangladeshi grassroots group Gonoshahajjo Sangstha, decried Washington's refusal to allow any alternative to market forces as a means to social and economic equity.

''The U.S. position affects democratic values, poverty and human rights conditions,'' Hasan said, ''yet it doesn't seem to matter when these things are undermined.''

Last week, the U.N. Research Institute for Social Development (UNRISD) detailed the social and economic devastation in many nations wrought by market liberalisution, privatisation and cuts in government expenditures as prescribed by donor countries and banks during the 1980s.

As a result of these policies, it noted, ''in general, the primary incomes of the poor are down, the number of people living in poverty is up, and social income -- access to public services -- has decreased.''

''The world economy does not need more intense market-based competition to make it more efficient-- rather it needs greater efforts to identify mutually beneficial solutions,'' URISD wrote.

But Melinda Kimble, acting head of the U.S. delegation to the talks here, said Washington ''believes that the evidence available now suggests that the best way to allocate resources efficiently is through the market.''

She told the Development Caucus that Washington will not support alternatives to the market for solving problems like large income gaps between different classes and sectors within societies.

Washington also drew fire from the Caucus for refusing to discuss debt cancellation for Third World countries, the elimination of poverty, and the equitable distribution of economic resources as a means to social justice.

''We feel that no worthwhile discussion on social development can take place if these issues are not discussed,'' said Zia Mian of the Islamabad-based Sustainable Development Policy Institute.

Earlier this week, the U.S. delegation objected to any mention of the words ''equity'' and ''equitable'' on the grounds that such considerations may constrain free market forces.

''I want to go on record and say that we are for social justice and equality,'' Kimble assured the NGOs.

The Development Caucus also accused the U.S. delegation of consistently proposing amendments to the Summit draft paper designed to water down the text from obligation-based language to permissive language.

For example, the U.S. delegation has proposed replacing commitments ''requiring'' urgent action on global poverty with commitments to ''consider'' such action.

''We can consider things for 100 years,'' Mian said, ''but when it comes to the market, it is required for the Third World.''

The South-North NGO coalition also decried Washington's opposition to any reconsideration of the economic model of structural adjustment programmes (SAPs) crafted by the World Bank and International Monetary Fund (IMF).

Patricia Feeney of Oxfam/UK criticised Kimble's unwavering defense of SAPs, which require governments to cut public expenditure to reduce budget deficits and meet debt repayment obligations. ''You're engaged in dismantling, without knowing what you're doing, a whole welfare system which has been built up since the 19th century,'' she said. ''While it may have its defects, it certainly assures protection for the most needy groups.''