Belgium floats proposal to ameliorate Third World debt

Bono's crusade for Third World debt relief will move one step closer to reality today when the chairman of an important economic conclave in Paris will put his own proposal to ministers from the world's 30 richest countries.

The Belgian Prime Minister, Mr Guy Verhofstadt, is leading the two-day annual council meeting of the Organisation for Economic Co-operation and Development (OECD). Speaking to a less formal discussion forum yesterday, he advocated a Prospective Aid and Indebtedness Relief programme - and he didn't even give credit to the Irish rock star.

Under the Belgian plan, the world's 23 richest countries would give 0.1 per cent of GDP for the next 15 years to reduce the debt of the 49 poorest countries. The planet's 850 million richest inhabitants would "extend a hand" to the 850 million poorest, Mr Verhofstadt explained.

Considering the results of the commitment made 33 years ago by developed countries to donate 0.7 per cent of GDP to development aid, Mr Verhofstadt's initiative may have little chance of success. Only five mostly Nordic nations have reached that goal. "Ireland is among the virtuous," said Mr Tom Arnold, the chief executive of Concern Worldwide and a participant in the OECD forum. Ireland now spends about 0.44 per cent of GDP on aid, and intends to reach 0.7 per cent in 2007.

The mood and language of international economic summits have been transformed since the Seattle World Trade Organisation meeting failed because of violent anti-globalisation protests in 1999. Mr Verhofstadt said the events of September 11th, the recession that followed, the rise of the extreme right in Europe and the collapse of Argentina's economy were all "symptoms of a process of globalisation which appears uncontrollable".

Although globalisation was the result of progress in technology and communications and "could no more be stopped than the trajectory of the moon", he believed it could be "mastered, and to a certain extent, adjusted". Globalisation has been extremely positive in Asia, pulling one-third of the world's population out of poverty.

"Business people in Ireland understand that, if there is an opinion climate to roll back on globalisation, it will affect the Irish economy, " Mr Arnold said. Open markets had been the most important factor in Irish prosperity, he added.

The anti-globalisation movement has forced rich companies and countries to take development issues seriously. Over the past six months, conferences in Doha, New York, Monterrey and now Paris have addressed international trade, security, education and economic growth as inter-linking issues. The talking will continue later this year at the World Summit on Sustainable Development in Johannesburg.

Participants at the OECD forum denounced the hypocrisy of the developed countries which, in Mr Verhofstadt's words, "profess free trade, but a free trade that protects our own textile and agriculture markets - major products for poor states".

At Doha in November, Ireland and France opposed reducing subsidies in the EU's Common Agricultural Policy. "If you want to help developing countries help themselves ... ultimately, it means Irish farmers will export more products with lower levels of subsidies," Mr Arnold said.

Most speakers criticised the new US Farm Bill. "If we're trying to have a level playing field, it's not fair to pit Manchester United against Aswan," said Mr Magdi Farahat, an Egyptian representative at the WTO. "We cannot compete with the US Treasury. If they pay US farmers 60 US cents on every dollar, I see no way in which developing countries can break out of their problems."