"Brazil is destroying their amazon forest at a rate of one football field a second. They are trying to pay off their national debt with cattle and land speculation. They don't even have time to sell the timber. Our barren forests are one of the main causes of global warming, the greenhouse effect..."

from film Mindwalk

photo from People's World Weekly

WORLD BANK DISASTER

A vicious cycle of debt was started in the 1970s when the World Bank, the US and other industrialized nations, offered and encouraged developing nations to take out loans at very low interest rates. The borrowed money was intended to help further industrialize those countries and raise the standard of living for those citizens. The big plan didn't pay back.

During the 1980s the interest on the loans sky rocketed. In 1982 Brazil's interest payments were 80% larger than before. Between 1981 and 1983, Indonesia's debt went from 16 to 22 million dollars. Many developing countries now send more abroad than they recieve in loans or aid. This means that there is a net flow of money from the poor countries to the rich countries. In Africa, for example, 22% of the total value of exports in 1990 went to debt repayment. This is money that these countries could have used for education, health care, agriculture development , and basic infasructure, including water and sweage in all public secor spending. Public enterprises have been privatized and millions of public worker jobs terminated in downsizing vital social services.