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Commentary (July 12, 2005)

G8: No Retreat, No Surrender

Mike Moore  (former Prime Minister of New Zealand and former Director-General of the World Trade Organisation)

In 24 hours, Britain went from Olympic euphoria to stoic sorrow as extremists murdered and maimed ordinary Londoners. It was a depraved assault on civilised values, while democratic leaders from the Group of Eight industrialised nations focused on helping the poorest, most marginalised people in the world.

The contrast could not have been greater. Leaders at Gleneagles stuck to their agenda of hope, damaged but not deterred by the message of hate. I thought of the great speech Winston Churchill made to the US Congress in 1940, as some suggested Britain should surrender or negotiate with fascist Germany. "What sort of people do they think we are?" he asked.

What sort of people do the terrorists think we are? Do they really believe the great democracies will surrender? The attack will not overshadow the real progress being made in addressing global issues led by Mr Blair. He has come out with guns blazing, calling on Europe to reform its finances and tackle the sacred cows of agricultural subsidies. Forty per cent of Europe's budget goes to subsidise farmers. Mr Blair has pointed out that this investment should go into hi-tech, research and development, and industries of the future.

The reform of Europe's subsidies folds neatly into Mr Blair's next ambition for Africa, which he championed at the G8 last week. A cow in Europe receives over US$2 a day in subsidies. Two billion people live on less than that per day, and 30,000 people die because of poverty every day.

The "make-poverty-history" campaign has become a popular worldwide movement. The Big 8 have agreed to wipe out some poor countries' debts and increase the levels of aid. They have given some impetus to the real deal that will do more to alleviate poverty than any other mechanism - the Doha development round of trade talks.

Africa is the only continent that has gone backwards over the past 20 years, her share of world trade dropping. It is easy to call for yet another Marshall Plan for Africa. Africa has already had five times more aid than went to Europe after the second world war. Why hasn't it worked? Europe's civil society, businesses, universities and parliaments were ready and eager to be rebuilt in 1945. Africa's success depends on building sound governmental structures, property rights, independent courts, democratic, accountable politicians and parties.

So-called "tied aid" - asking for receipts, ensuring that the money got to those being targeted - was seen as a form of colonialism in the 1970s. Now the wheel has turned, and the much-hated word "conditionality" is more accepted as a mark of good housekeeping. Despite appalling rip-offs, aid does work and, now, can work even more effectively.

Malaria still kills 3 million people per year in Africa and costs the African economy US$12 billion a year. It can be stopped in Africa, as it has been elsewhere, at a cost of about US$2 billion a year for five years.

The same can be achieved for HIV/Aids and tuberculosis, given the resources and commitment. Debt relief, channelled through transparent accounts to prevent abuse, will do much good.

In 1919, economist John Maynard Keynes condemned the debt the victors imposed on Germany after the first world war, saying: "We shall never be able to move again, unless we can free our limbs from these paper shackles."

Keynes would be proud of the progress made by Mr Blair, who now stands as one of the few political superstars on the world stage.

(Originally appeared in the July 11, 2005 issue of South China Morning Post in Hong Kong, reproduced here with permission.)

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