mmercial banks, and it would be quite wrong for governments to dictate terms to the banks.
I have to say that I have little patience with the objections that have been raised to my proposal for concessional interest rates in these circumstances. The basic analysis has not been questioned, and it leads inexorably to the conclusion I have outlined. The job now is to take action, before the problem gets worse.
I therefore urge those countries which have so
so far been dragging their feet to join in this initiative, SO that we can agree a timetable for action at the international meetings this autumn. We i have a moral responsibility, as well as an economic one, to some of
the poorest countries in the world.
I am glad to say that the IMF and the World Bank have now joined in recognising the need to tackle the problems in this area. The Managing Director of the Fund has proposed that more concessionary funds should be provided for low income countries, and this initiative was welcomed at the Venice Summit. Discussions are under way to decide how best to achieve the objective of providing more help from the Fund and Bank for the poorest countries. The UK is playing a full part in these discussions, and I hope to see us make parallel progress in this area, too.
The Wider Context
In the longer run, the aim for the Sub-Saharan countries must be the same as for the middle income debtors: that they should be able to play a full part in the world economy. They need to capitalise on those products in which they do have a comparative advantage typically, agriculture and minerals.
This depends on two things. First, the African countries need to restructure their own economies, to shift the emphasis back towards agriculture, rather than bolstering an inefficient manufacturing industry often supported by a highly protective trade regime and a bloated public sector. Some of the poorer countries do not help themselves by over taxing farmers, or not paying producers the world market price for their products, out of a misguided wish to
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