I am grateful for the opportunity to raise the profile of Latin America in the House. There is growing interest in Latin America among Members of both Houses, as evidenced by the attendance that we have had at some meetings of the all-party Latin America group and by the increasing number of groups being formed for individual countries in Latin America.
It is timely to focus on the strategy of the Department for International Development, because my understanding is that this year, 2006–07, DFID will review its regional assistance programme. It has certainly promised to do that. Initially, however, I shall talk about why Latin America is important and why DFID and the Government in general should be interested in it. It is sometimes said that Latin America is not a traditional area of influence for the UK. We have relatively little in the way of former colonies or territorial interests in the region, and some of the old pre-war links—we used to build quite a lot of infrastructure there—are not what they were. However, it would be a major mistake to marginalise our interest in Latin America, and I shall give five reasons for saying that.
The primary reason for DFID being involved in Latin America is that 57 million people there still live on less than $1 a day, and 132 million people live on less than $2 a day, amounting to 26 per cent. of the population. The aim of DFID's strategy is to contribute to the achievement of the millennium development goals. However, even the best current projections for 2015 are that Latin America will fail not only on the poverty measures that I have just mentioned, but on maternal mortality, infant mortality and HIV/AIDS outside Brazil. All too often, it is the indigenous and black people of Latin America for whom those targets are least likely to be met.
With the exception of Nicaragua, the countries of Latin America are classified as middle-income countries, albeit Bolivia and Honduras just creep into that category. However, the point about the countries in that part of the world is that they are extremely unequal. Half the world's 20 most unequal countries are in Latin America. That has an effect on crime: half the world's 10 most violent cities are in Latin America. We may be dealing with middle-income countries, but there are still huge numbers of poor people in them. As I said, 57 million people—a lot by any standard—are in absolute poverty. We will not achieve the millennium development goals worldwide if we do not deal with the situation in Latin America.
Mr. Oscar Schiappa-Pietra is executive director of Peru's agency for international development aid co-operation. I had the privilege of meeting Mr. Schiappa-Pietra in Lima when I led an Inter-Parliamentary Union delegation in February. He wrote something very relevant about middle-income countries in a foreword to DFID's publication ““Alliances Against Poverty: DFID's Experience in Peru 2000–2005””. Of the middle-income country classification he says:"““This is a label that greatly over-simplifies the complex socio-economic and political realities of countries like Peru . . . middle-income countries are often getting the worst out of globalization, because they are being left aside from much needed ODA””—"
official development assistance—"““resources while still unable to compete in either the knowledge or the low-wage economy . . . the shift in classification from poor country to middle-income country misses an understanding of the transitional stage of internal adjustments such as those aimed at generating a more equitable allocation of resources and wealth.””"
DFID has particular knowledge and expertise to be able to address that problem. With such a vital role to play, DFID has to be active in Latin America.
The second reason why we should be interested in Latin America is that we can make a difference in helping that region to make progress. When I return from visits to Latin America, I am always optimistic about the region. Indeed, I am much more optimistic than I am when I return from some of the visits to Africa, where the situation in some countries is quite difficult. We are right to be involved in Africa, but one sometimes returns quite pessimistic about the prospects there.
In Latin America, the institutions are often better and stronger. Yes, there is corruption, but it is not as bad as in Africa. There are not wars and conflict on the same scale as in Africa. There is armed conflict in Colombia, but we are not talking about Darfurs, DRCs and so on in Latin America. Nor is there the scourge of international terrorism in Latin America. Above all, what makes me optimistic about the region is the great advances that there have been in achieving democracy. We are seeing many elections this year in Latin America, and in country after country we are seeing orderly, free and fair elections. That is not the case in every country, but it is in most of them. Recently in Bolivia, there was a very orderly and fair election; no one is challenging the result. The first round of elections in Peru was very close. People had to wait a week or two for the result, but the situation is being managed. That is very encouraging when one considers that it was not that long ago that many of those countries were being ruled by the military.
The third reason for regarding Latin America as important is that it has huge growth potential. Indeed, many of the countries have been experiencing substantial growth in recent years as a result of high commodity prices, although sadly that is not being translated sufficiently into poverty reduction. We as a country should not miss the opportunity to be involved there through trade and inward investment for mutual benefit, especially as the region contains countries with worldwide political influence. We ignore those countries at our peril. The most obvious example is Brazil, but there is also Mexico. Chile is important, too: it is a remarkable success story of economic progress and stability. If we do not take the opportunities in south America, China will. In fact, China is already moving in there in quite a big way. It is therefore important that we are in the region.
The fourth reason is that many of the countries in south America want a strong relationship with the European Union to balance their political and trade relations with the USA. Given our Government's attitude towards trying to end EU protectionism, common agricultural policy reform and the type of deal that we are trying to secure from the Doha World Trade Organisation round, we are probably Latin America's best EU partner, if only more people would realise that. Many people and politicians in Latin America do not realise it.
I was fortunate enough to attend a conference of parliamentarians from all over Latin America last November in Buenos Aires, and I told the conference of our Government's efforts during the presidency of the European Union to try to tackle the immorality of the fact that in Europe we spend $2 a day per cow when 130-odd million people in Latin America live on less than $2 a day. After I had spoken, an Argentine politician passed me a note. She said:"““Your words are very good news for us. The media in Argentina haven't given information about this position. (We didn't know the English proposal about subsidies.) Thanks for this. Good information is one of the biggest needs we have. Sorry for my English.””"
I have to say that that lady's English was a lot better than my Spanish. I found those words quite encouraging, coming from an Argentine parliamentarian.
That leads me to a further point: how we as a country are all too often seen by the people and the politicians in Latin America. We are sometimes, sadly, seen only as America's partner in Iraq. As we know, people in south America do not particularly like President Bush and did not agree with the invasion. We therefore have a job to do to enable people in Latin America to see us as we really are, leading the world, as we did through the G8, on debt relief, increased aid, getting a fair trade agreement at the WTO, tackling the millennium development goals and devising the international finance facility. That is the position that we need to establish clearly in people's minds in Latin America, but we can do so only by being involved. Our one advantage is that, despite everything else, we are still respected for the quality of what we do, as we are throughout the world.
The fifth reason we should take Latin America very seriously concerns drugs. I shall say more about this later, but we should remember that the world's three biggest coca producers are all in south America: Columbia, Peru and Bolivia.
I now turn to DFID's regional assistance programme. There has been a major change in the way DFID operates in Latin America. It has moved away from bilateral country-focused assistance programmes to more strategic involvement, working with the World Bank and the Inter-American Development Bank. That change, along with the closure of offices in Peru and Honduras and the closure of our embassy in Paraguay, has led to a charge that the Government are withdrawing from Latin America.
It is sad and disappointing when programmes close. I read what was achieved in Peru concerning citizenship and governance in ““Alliances Against Poverty””, and it is sad to see that coming to an end. When I was fortunate enough to lead an IPU delegation to Brazil in 2003, we saw first-hand some of the work going on through DFID in the north-east of that country to help poor and excluded people to gain confidence to pursue their rights in a responsible way. When we made a more recent visit to Peru in February, the Prime Minister of Peru, Mr. Pedro Pablo Kuczynski, told us straight, ““It is not aid we need. We do not need aid; we have got a lot of money now from the commodities that we are selling. What we need is knowledge, expertise and technical support.””
The more I have examined DFID's new strategy and the more I have learned about Latin America, the more I think that the new approach could be even more effective, if it works. DFID's knowledge and expertise in exerting influence on the way in which the World Bank and the IDB work in Latin America has great potential to focus efforts more successfully on poverty reduction, which is a job that needs doing. That process relies on DFID's great strength in the world; wherever I have been, I see DFID punching above its weight, using its high-quality reputation. I met staff who were working out of the Andean office in La Paz, and I pay tribute to the work that they are doing.
There are two huge challenges involved in the new strategy. The first is the challenge of being able to influence international financial institutions—the IFIs—such as the World Bank and the IDB. It will be a challenge to get them to use their money in a sufficiently transparent way, to use it more thoughtfully and to aim it more effectively at poverty reduction. This is a matter of widespread concern. The Minister and other hon. Members will know of the international parliamentarians' petition for democratic oversight of the World Bank and the International Monetary Fund. Across the world, 55 Parliaments have been involved with the petition; I do not have the latest figures, but when I last looked, there were well over 1,000 signatures. I am delighted that 365 of those came from Parliaments in this country. That is a major challenge, but it needs to be taken on.
The second challenge is to overcome the growing disaffection and mistrust of the IFIs that so many people and politicians in Latin America share. Politicians, civil society groups, trade unionists in Latin America and international non-governmental organisations have documented many examples of misconceived schemes, often agreed between the IFIs and discredited former leaders with little or no transparency or accountability and no involvement of parliamentarians or community representatives, or with loan or trade conditions that destroyed local livelihoods and, in some cases, wrought macro-economic damage. As a result, the Washington consensus reforms of the 1990s are widely seen as a failure in Latin America because of their lack of impact in reducing poverty.
In that part of the world, there is now a deep suspicion of globalisation, privatisation and labour market reform, but from a wider historical perspective, one can see that the region needs to find acceptable ways of becoming less protectionist and expanding trade because of some of its past failings. Politicians from all over the region now regularly condemn neo-liberalism, which is chiming with electorates. We have seen that in the results of various elections, most recently in Bolivia and currently in Peru, where such messages are well received by people and reflected in the way in which they vote. I have to say, however, that some commentators have been very simplistic in painting all the leaders on the left as being the same and representing some sweeping direction. There is a world of difference between Chile, Bolivia, Brazil and Venezuela.
It is worth remembering what Ricardo Lagos, a centre-left moderate by Latin American standards who was until recently the President of Chile, said when he came here for the conference on progressive governance in 2003, in a speech entitled ““A View from the South””:"““We've completed all the tasks assigned to us by the so-called ‘Washington Consensus' . . . Nevertheless, the fact that Chile has completed these tasks does not necessarily mean that the Washington consensus is correct . . . In Chile, we were able to stick to the Washington consensus because in addition to it we did other things, and this is what really made the difference . . . if you are going to have growth, you need public policies that ensure that growth will be enjoyed by the many. If not, then you are on the wrong track. In the long-term, if you are not creating a cohesive society you will be defeated. This is what I think has happened in most American countries.””"
Those are very wise words.
However, the UK has the credentials to help to overcome the deep suspicion of IFI policies that exists throughout Latin America, which clearly influences the attitudes of some Governments. My first reason for saying that is our policy on conditionality—particularly trade conditionality. That was best expressed by the Secretary of State for Trade and Industry in his ““Wall of Shame”” speech of last October. He said:"““We have seen all too often before how the World Bank/IMF ‘one size fits all' shock therapy prescription has produced macroeconomic instability, rising unemployment and profound inequality. Societies and economies have been left dislocated . . . we must not force liberalisation on developing countries . . . we must leave it for them to decide the ‘what, when and how' of their market openings.””"
Those words will be very well received in many Latin American countries. My second reason is our policy on aid conditionality, clearly set out in DFID's policy paper of March 2005, which places an emphasis on genuine, bottom-up poverty reduction strategy papers, not the imposition of conditions.
Another thing that will encourage people is our stated policy of trying to reform the World Bank and the IMF. DFID produced its first report in 2004 on its dealings with the World Bank, and committed itself to using a seat on the board to gain reform. The Treasury has taken a similar stance regarding the IMF. I have mentioned our stance within the EU of wanting better access to markets for poorer countries, including those in Latin America, which I also believe would be well received.
Above all, however, I emphasise the stand we have taken in the world in taking the heavily indebted poor countries initiative forward, from which Bolivia, Nicaragua and Honduras have benefited, our historic stand in the G8, which resulted in the Gleneagles agreement, and the efforts of the Chancellor in the devising and promotion of the international finance facility to help to achieve millennium goals. The really good news is that Brazil signed up to that, in relation to HIV/AIDS, during President Lula's recent state visit.
Having said how our involvement in Latin America could help to overcome some of those suspicions, I would like to ask my hon. Friend the Minister some questions about where we have got to in relation to some of the issues I raised. What progress have we made with the World Bank on decentralisation of programmes and on increasing stakeholder participation in the design of the poverty reduction strategy papers? Have we got anywhere in achieving parliamentary oversight and modification of those programmes? Have we managed to gain any ground in achieving stronger representation on the World Bank board for the poor recipient countries? People have asked for a parliamentary role in the selection of its executive director and other equivalents throughout the world. Have we got anywhere with that? There have been calls for external auditing of World Bank operations and recorded votes at board meetings. Have we got anywhere on any or all of that?
How do we influence the IDB when we do not have the same representation on the board as we do on the World Bank? It seems that the IDB, on which Latin American countries have strong representation, has the right goals; but, again, they are not being sufficiently translated into poverty reduction.
What is the overall process for monitoring the strategy of the regional assistance programme? Is DFID planning to publish annual reports? How do we know if the strategy is succeeding? How does the European Union programme for Latin America fit into that? The EU spends about $375 million a year, so how does it fit in, and how are we trying to invest that EU spend?
I urge my hon. Friend the Minister to do all that he can in the Department to encourage regional integration in Latin America, particularly in terms of transport and energy infrastructure. It is really lacking. Out there, one notices the absence of such transnational infrastructure. There is much suspicion between countries about going down that route. There is outright opposition in some quarters, which see it as some kind of neo-liberal plot.
I hope that there is a lesson to be learned from the European Union. EU integration has actually benefited the poorer countries most. Countries such as Portugal and Spain used to be poorer than Argentina and Brazil. Now they have come up in the world, and I suspect that the EU has played a big part. It is a strong argument to put to people in Latin America, and I hope that DFID can do so.
There are some very good UK non-governmental organisations working in the region. I recently visited a project run by the Action for Brazil's Children Trust in Recife in north-east Brazil. I saw an excellent, high quality and sustainable scheme, which works with a local partner. The ABC Trust runs five schemes and supports 13 others in Brazil. In Peru, we learned about the work of the Vine Trust, a Scottish based charity that has provided several millions of pounds in cash and volunteer medics and doctors who have gone out there. The trust has a medical boat called the Amazon Hope, based at Iquitos in Peru. It travels throughout the Amazon, bringing valuable medical care to thousands of people who would otherwise have nothing. When we were in Peru in February, a second boat, which had had a £1 million refit, was on its way from this country to join it.
Such initiatives are wonderful, and I wonder what DFID is doing to support that sort of work. It makes a real difference and it helps to build the good relations that we need. The regional assistance programme says that DFID will provide increased funding for international NGOs. Will my hon. Friend the Minister provide any details about how we support such organisations?
The issues surrounding drugs in Latin America, as in other parts of the world, can undermine all that DFID tries to do. For example, coca and the cocaine system in Latin America impact not only on the economies of those countries, but on their environments and social cohesion. They can bring death and violence throughout the world. The authorities in Peru told us clearly that coca production is on the increase again in Peru. President Morales, who was recently elected in Bolivia, says that he wants his coca growers—he was a coca grower leader—to be able to grow more coca not less. Policies such as crop eradication, which have been tried, are now politically unacceptable to most politicians in Latin America because of the economic hardship that they have brought to coca growers who then rise up and, as we have seen, can sometimes overthrow Governments.
Crop substitution has been tried and does not work either, because the economics of it are not right. Farmers can get more from growing coca than they can from other crops. Our best bet is intelligence-led intervention in drug trafficking. We as a Government have overseas drug liaison officers in several Latin American countries. They are under the direction of the Serious Organised Crime Agency. However, when we were in Peru in February, we were astounded to learn that the two drug liaison officers based in Lima were being redeployed in April to Colombia.
Latin America
Proceeding contribution from
Bob Blizzard
(Labour)
in the House of Commons on Tuesday, 2 May 2006.
It occurred during Adjournment debate on Latin America.
Type
Proceeding contribution
Reference
445 c373-9WH 
Session
2005-06
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Westminster Hall
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Timestamp
2024-04-11 18:10:14 +0100
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