Seminar “Women, Debt and Microcredit”

The seminar (online summary, so far in French only) opened with a public lecture that attracted an audience of about 250 people, mostly women. The way public and private debt are two sides of a same coin linked to Structural Adjustment Programmes (SAP) and the development of microcredit producing entrapment in debt was clearly explained. Other matters covered were the role played by microfinance in aggravating indebtedness and impoverishment, particularly where women are concerned.

These situations were then discussed in detail by the participants. An environment of free expression was created, where women could tell of their different experiences and actions against the effects of illegitimate debt in their own countries. These tangible experiences confirm the observation that microfinance is never a means of emancipation for women, on the contrary, it has aggravated the subordinate position of women in capitalist and patriarchal society.

Alternatives were presented and examined. Nevertheless, the fight against poverty is larger than the question of access to finance, but implies rights and access to health care, education, housing, employment, good nutrition and a healthy ecological environment. In fact, the struggle against poverty is part and parcel of the global struggle for human dignity and decent living conditions.

The seminar, which the participants consider to have been very successful, was well relayed by Mali media and closed with a public meeting that attracted about 400 people. A final declaration was made linking capitalism, Structural Adjustment Programmes and microcredit to the oppression women have to bear.

Afterwards many of the female participants took part in the training scheme organised by the CADTM International.

The CADTM: the story

Because numerous participants were newcomers to the CADTM network it was considered appropriate to tell the story of the CADTM, from its origins in Belgium, through the development of the network throughout the World, the evolution of the call for the abolition of Third World debt to the abolition of all illegitimate debt, whether public or private. The history of the association was presented by Eric Toussaint, a co-founder of the CADTM in Belgium in 1990, and enriched by further accounts by activists from West Africa, Morocco, Argentina and India.

The CADTM originated from the “Bastille Appeal” that was announced during the big demonstrations in Paris in 1989 against the G7. The cry was “Debt, Apartheid, Colonialism: ENOUGH IS ENOUGH!” These words echoed the issues of capitalism and colonialism highlighted by the 1982 Mexican default on payments and the third World debt crisis, and the public finance crisis in the North that followed in its wake, whilst Fidel Castro in Cuba in 1985 and Thomas Sankara, President of Burkina Faso in 1987, had called on countries that were victims of debt to stop paying.

From counter-summit to counter-summit all along the 1990s groups and activists, including from the CADTM, met and evolved into what came to be called the “Alterglobalist” movement: demonstrations against the 50 years meetings of the IMF and the World Bank in Madrid in 1994; meetings with the Zapatistas struggling in the Mexican Chiapas; demonstrations and counter-summit against the G7 and G8 meetings, and many more. In 1999 a petition calling for the abolition of third world debt, with 17 million signatures collected by Jubilee 2000 was presented to the G7 meeting in Cologne. Not satisfied with the soothing announcements of the abolition of $100 billion of Third World (HIPC) debt by the World leaders in response to the petition, the CADTM and organisations from southern countries created “Jubilee South” and held a first meeting in Dakar in December 2000, where it was decided to continue the struggle against the debt and the Structural Adjustment Programmes imposed by the IMF and the World Bank.

The CADTM network expanded through cooperation with already existing organisations and the creation of new national sections in different countries. In 2003, at a meeting held in India, it was decided to officially create a worldwide network that would maintain relations between the different member organisations located in Africa, Latin America, Asia and Europe. The first general assembly of the network took place in Belgium in 2008. A political charter and organisational principles were established as complements to the “Bastille Appeal”: every network member organisation takes its positions and decides its objectives independently within the boundaries fixed by these documents. In 2013 it was decided that the role of the International Secretariat would be shared by CADTM Belgium and ATTAC CADTM Morocco.

The extension of the fields of struggle

The participants discussed the CADTM’s widening field of struggle, whose ambitious goal, shared by all who sincerely fight combat exploitation and oppression, is to change the course of history. To do this the CADTM has chosen, principally, to resist and struggle against debt, acting against a deadly economic system imposed by the International Financial Institutions (IFI), complicit governments and local dominant classes. From its creation certain radical CADTM positions gave rise to debates with other organisations that are part of the global anti-debt movement, which in their turn permitted the development of stronger positions and understanding: unconditional abolition of Third World debt; rejection of international arbitration and restructuring, in favour of popular auditing of sovereign debt leading to unilateral suspension of payments and repudiation. This objective has brought international success, in particularly in Ecuador where an integral audit was carried out between 2007 and 2009 leading to large scale debt reduction.

The CADTM evolved its positions along with the financial crisis that began in 2007-2008 and became the European sovereign debt crisis of 2009-2010. In the Northern countries where it is present the CADTM denounces the bank bail-outs by the governments who oblige the tax payers to foot the bill and impoverish the population through austerity policies and measures that increase the burden of public debt. In Greece (May 2010, March 2012, July 2015), Ireland (December 2010), Portugal (June 2011) and Cyprus (April 2013), the IMF imposed Structural Adjustment Policies that are thoroughly identical to those experimented on the economies of the South over previous decades. The CADTM calls for audits of public debt and has taken part in creating public audit committees in several European countries. In 2015, the CADTM took an active part in the audit committee called by the President of the Greek Parliament and the demonstrations in support of the Greek people against the coercion of the Troika. Today, the debt crisis is no longer in the headlines. However, the public debt is still used as an excuse to introduce anti-social policies whereas the way private banks, the biggest culprits of the crises, are run, has not been fundamentally changed, so the CADTM continues to warn of the dangers of new crises and ardently supports the creation of alternative possibilities.

In addition, the CADTM has spread its struggle to private debts, that have sharply increased since capitalism has entered its neoliberal phase. At the very beginning of the series of meetings the question of microcredit was broached, this system, under the pretext of giving access to the market and to globalisation, turns out to result in a greater burden for the most marginalized sectors of the population, particularly women. It was pointed out that it was no coincidence that microcredit developed alongside Structural Adjustment Policies. It was a logical consequence of greater poverty, unemployment and the withdrawing of the State from public services.

Other forms of personal debt were also brought up, such as the massive phenomenon of student debt that has been greatly increased by the liberalisation and continual increase of higher education inscription fees and costs, particularly in the US, the UK and Japan. Mortgage debts – which sparked off the subprime crisis from which we have not yet recovered – are a violation of the right to housing and highlight capitalism’s predatory nature which does not hesitate to speculate on four walls and a tin roof to make a profit.

The African dominant classes

Jean Nanga, from the Congo (Brazzaville), spoke of the arrival and role of the African dominant classes. Understanding their place in African society is essential seeing that the IFIs and the dominant classes of the imperialist countries are not the only culprits of Africa’s subordination, lack of productive investment and unfair distribution of its wealth. This is not to excuse the IFI’s and their imperialist cronies, but to build an analysis that takes into account the mechanisms of African capitalism in order to build a guiding theory which will enable the African forces for emancipation to identify the strategy and tactics necessary to confront the African dominant classes.

Over the last decade we no longer hear only of African poverty, much mention is also made of emerging ‘lion’ states with high economic growth and African billionaires who are said to be the symbols of the African economic “take-off”.

Fifty years ago, Frantz Fanon, author of The Wretched of the Earth, showed the limits of African bourgeoisie: “The national bourgeoisie of underdeveloped countries is not engaged in production, nor invention; nor in building, nor labour, it is completely canalized into activities of the intermediary type. Its innermost vocation seems to be to keep in the running and to be part of the racket” (Chapter Three). For Frantz Fanon, it is a class that will be forever subjugated and will never be an actor of radical change in favour of the peoples.

The debate that raged about African social classes in the 1960s is dead. Kwame Nkrumah, who theorized “consciencism” suggesting that social classes did not exist in African society, finally published , after having been ousted by a military coup, a work entitled The class struggle in Africa.

So, there is a dominant class in Africa having “high value” individuals and this is not a new phenomenon.

A historical look at the creation of the local dominant classes

Since the arrival of the first Europeans, there has always been a native African minority who identified their interests with those of the Europeans who practised the slave trade – particularly the African Kings. This minority took an active part, right up to the 19^th century, in capturing slaves and transporting them to the shipping docks. After the abolition of slavery the same dominant class continued to trade slaves and other commodities with the colonizers. It was this activity that laid the ground for the birth of an African dominant class from which many of today’s wealthiest Africans are descendants.

These dominant classes have also profited, since the 1960s, from post-colonial policies of “indigenisation”. African governments have expropriated the foreign capitalists and handed the riches to their own local capitalists. These companies, run for the profit of a minority little inclined to respect even its own rules, have received, from public banks, loans they have never repaid, thus contributing to the 1980s debt crises. This is the crisis that produced the SAPs, imposing privatisations and the liberalisation of the markets. Foreign investors were not alone in benefiting from these measures; the local dominant classes were right in there with them, at the expense of the poorest sectors of the population. The local dominant classes do not have the weight of foreign investors but their powers are far from negligible.

Since the PAS were imposed the accumulation process advances with the support of the IFIs. They are the guides who encourage the States to support private initiative. Those who lag behind are badly noted in the World Bank’s Doing Business report.

Crony capitalism and integration into global capitalism

Jean Nanga developed the idea that the local dominant classes are very often close to a country’s leaders, some of whom are themselves seriously dabbling in business. He gave the example of Olusegun Obasanjo, who was President of Nigeria between 1999 and 2007 and helped himself to thousands of shares in an oil company and distributed more to retired generals. Another example is the accrued wealth of Isabel Dos Santos, daughter of José Eduardo dos Santos, President of Angola between 1979 and 2017. Over a dozen years, she, who is called “The Princess”, became a billionaire thanks to privatizations in her favour, decided by her father. Today she is a shareholder in telecommunications and fossil fuels companies as well as in commercial banks.

When business men grant loans that turn out to be non-performing the debt burden falls to the State and the popular classes. What is more, the dominant classes often practice tax evasion, thus increasing public deficits which in turn push the country deeper into debt, thereby further straining resources necessary for social spending. Of course, they are never bothered by tax inspectors !

At the 2014 Africa CEO forum (an annual gathering of African employers and investors to discuss African economic affairs, organised by Jeune Afrique and Rainbow unlimited , and sponsored by the African Development Bank) it was announced that African companies would provide 23% of the continent’s investments, whilst they only provided 8% in 2007. This group claims to be Africa’s second biggest investor, led only by West European companies; and second biggest employer. In fact, these companies are principally run by expatriates from other countries leaving the locals in only a few highly placed jobs. We must not be under the illusion that the local dominant class shows solidarity with African labour. Local employees are paid less than their colleagues who work in other African countries and much less than what foreign companies pay their employees.

African investors also invest outside of Africa, i.e. in the Netherlands, South Korea, Russia and even Brazil. They have entered the international dominant class.

A bit of competition between different capitalist groups (foreigners or locals who denounce foreigners’ monopolies) may arise, as it may do so anywhere. African capitalists are sometimes worried that they are suffocated by foreign capital. So, the African Industrial Association has taken position against Economic Partnership Agreements but the local dominant class is not fundamentally opposed to Foreign investment, they are a part of it. Capital interests are interconnected. Whatever their origins they follow the same logic of profiteering.

Local dominant classes and debt policies

Eric Toussaint explained the interests of the local dominant classes not to disrupt neither domestic nor foreign cycles of indebtedness. Concerning domestic debt, it is easy to understand that the local dominant class seeks to lend to the State for a good rate of return. This tendency could already be noticed in the 19^th century and has continually increased over the last decades. This results in a transfer of State revenues that have been levied on the popular classes towards the dominant classes whose income from loans to the State may be considered to be unearned incomes. The local bourgeoisie also have interest in their State’s foreign debt. The comprador bourgeoisie (the merchant bourgeoisie of the dominated countries) being big importers use the foreign currency gained through external debt to pay its imports. What is more, States finance their debts by renewed debt and so reduce the level of taxes on capital. Reducing public debt must necessarily be accompanied with tax increases on capital.

Moroccan capitalism as an illustration of the capitalist dynamic in Africa

Omar Aziki, member of ATTAC-CADTM Morocco, illustrated Jean Nanga’s presentation by the example of Morocco. Although under the subordination of the Northern States Morocco reproduces, for its own account, the same aggressive exportation of capital to the other African States and through the interconnection of world capital it has become another path of entry into Africa for the neo-colonial conquests of the multi-national corporations. The SAPs, particularly the privatisation and laissez faire chapters have allowed great accumulations of capital into the sphere of a small group of local capitalists and multi-national corporations. These policies have enjoyed great public sector support that has found the massive investments necessary to create the networks that capitalism needs. These expenses have increased the weight of public debt and will be paid by the Moroccan population. The expanding crony capitalism is largely orchestrated by the Moroccan monarchy that maintains a monopoly on political power and continually extends its grip on the economy through its National Investment Society. Hindered by the restricted possibilities of their internal market Moroccan capitalists seek to expand their possibilities of investment into the rest of the African continent.

Morocco is assisted in its expansion by the Western Imperialists who have made it a privileged ally as it is considered to be a strong and stable State. The Moroccan monarchy, which is a springboard for neo-colonialism, also polices the flow of migrants. The Moroccan authorities do not blindly obey European demands. Their policies on migration (and so their treatment of migrants) are bargaining chips in their negotiations with European Imperialists.

In Africa, the big Moroccan corporations are investing in telecommunications, the banking sector, fossil and renewable energy, housing and infrastructures. Moroccan corporations have made the most of the telecom privatizations throughout the African continent. It is to be noted that the use of cell phones accelerates the process of financial inclusion of the local populations through the development of mobile payment systems which also integrate into the micro-finance systems. In 2014, 34% of the African population had a bank account, but 12% have a cell phone account (World average is 2%). Moroccan banks maintain 45 subsidiaries in Africa. Their total assets are equal to 107% of Moroccan GNP, usually as universal banks, they offer deposit, investment, insurance and offshore services. Transport is an important sector that Moroccan capital seeks vigorously to develop, particularly through public-private partnerships where the private sector gains control of important infrastructure networks. Moroccan capital is also involved in construction on the African continent, through joint holdings between the National Investment Society cement production and the Franco-Swiss group Lafarge-Holcim (Lafarge-Holcim is currently accused by the French judiciary of giving financial support to Daesh in Iraq and Syria). Moroccan investors are also involved in oil drilling and in the extraction of mineral ores. Finally Moroccan capital takes part in land grabbing in order to develop a food industry that will in no way benefit the local populations.

With the help of the IFIs and of Western and Chinese imperialism Moroccan capital is in the horde of multi-national corporations chasing neo-colonial domination in Africa. Moroccan capitalism grabs its share of the cake. In most of the mentioned sectors the Moroccan monarchy is a heavy-weight investor maintaining an authoritarian power that serves its own wealth. The Moroccan monarchy is a hindrance to the development of the country’s productive forces.

Odious debt and other illegitimate public debts, vulture funds, revolutionary transformation of society

The seminar programme was enriched by discussions to define the concepts and the use of the concepts of odious debt, illegitimate debt, illegal debt and unsustainable debt [1]. Eric Toussaint presented Alexander Nahum Sack’s doctrine of odious debt – a debt is odious if the use it is put to is against the interests of the population and the lenders were aware of this, or could have been aware of it – which is based on fundamental legal principles and the study of many historical cases of debt repudiation. These principles may support legitimate legal arguments in favour of repudiation of debt, in contrast to the dominant discourse saying that debts must always be honoured.

The preying behaviour of investment funds, sometimes called “Vulture Funds”, who speculate on the high returns on debt bonds of States facing default is well documented and denounced. The case of Argentina, presented by Maria Elena Saludas, who follows this question, illustrates these practises. Vulture Funds purchased a large amount of Argentine debt and then refused to take part in the restructuring after the payment default that occurred in December 2000. Then, when Mauricio Macri was elected President in December 2015 he rapidly took measures to satisfy the Vulture Funds and resume borrowing, even though Argentina had shown that a country can have good growth without the financial markets.

Debt auditing was also very much considered. It would be useful to audit debts in several sub-Saharan countries where the debt shows signs of being odious or the result of SAPs that have been disastrous for the populations. Audits would bring to light not only the nature and conditions (i.e. sum borrowed and interest rates) of the borrowing but also the identities of the borrowers and the social and environmental consequences suffered by the populations, as did the audit carried out by Ecuador with very positive results.

A general audit of the debt would give the social movements that we take part in and seek to develop the opportunity to inspect public debts and to convince their public opinion of the necessity of unilateral repudiation. This measure, which would liberate vast resources for social programmes and the creation of jobs, must also be accompanied with other strong political measures in order to ensure that the cycle of indebtedness is smashed and create the basis for a world that has more sense than the one we are currently subjected too.

These last thoughts were developed during the presentation of the history of Soviet debt repudiation after the October revolution in Russia in 1917. Debt had been inherited from the tsarist regime and from the provisional government in place in Russia between February and October 1917. The perspectives of revolutionary social change were assessed in regard to recent events in Maghreb, Mackrech and the ousting of Blaise Compaore in Burkina Faso. The Stalinist counter-revolution in Russia, the current ones in the Middle East and North Africa as well as the absence of change in Burkina Faso reinforce the idea that the oppressed and exploited must create strong long-term democratic movements to establish favourable and permanent balances of power. The experience gained by the mobilised sectors of the population, particularly the young, in recent struggles that have shaken totalitarian regimes serving the exploiters, is undeniably one of the peoples assets in the coming struggles.

Meeting of the CADTM International Council

The CADTM held its annual International council meeting to assess the network’s recent actions and to schedule future actions. The activities since the precedent meeting of the International Council that was held in Tunis in April 2016 were presented by ATTAC-CADTM Morocco. The Council considered the realisations and activities favourably.

Through ATTAC-CADTM Morocco and the International Secretariat contacts have been established in Egypt where, despite the repressive nature of the current regime a CADTM chapter is being created. ATTAC-CADTM Morocco continues to develop numerous activities in a repressive situation where the authorities refuse to recognize the association. A new study of micro-credit has been published (a summary, in French, is available; meetings of activists, both national and international have been organised, A meeting of Maghreb countries to discuss free-trade agreements and food self-sufficiency in December 2017. Participants are expected from Tunisia, Algeria, Egypt and Palestine.

The agenda of upcoming events in sub-Saharan Africa was presented. Over the next few years African countries where a CADTM network member is present will organize the CADTM’s African summer schools, the next seminar “Women, debt and microcredit” as well as a regular programme of training schemes and seminars in all the countries concerned. After Egypt, an activist group in Kenya has requested adhesion to the CADTM International network.

In Europe, the CADTM maintains its contacts with the alter-globalist network and takes good note of its recent relative successes by supporting common constructive actions on the challenges in the euro zone. The CADTM actively supported the creation of a united front against illegitimate municipal debt in Spain and a CADTM chapter has recently been launched in Italy.

The date and place of the next regional CADTM workshop in Asia was decided – 6 to 8 April in Colombo, Sri Lanka, and will probably be followed by a public meeting in Delhi, India, to present the English version of the latest book The debt System which is due to appear soon.

In Latin America the CADTM is very much involved in the counter-summit “WTO Enough” that will take place in Buenos Aires, Argentina, in December as the contradiction to the WTO meeting that is to take place at the same time and place. In 2018, the CADTM in Latin America will mobilize against the G20 which will also take place in Argentina.

The International council also discussed the CADTM’s part in the upcoming World Social Forum, to be held in March 2018 in Salvador de Bahia, Brazil, as well as in the process of convergence among social movements that originated in the landless peasants movement and will be held in Caracas, Venezuela, during the first six months of 2018.

A debate on the subject of the three socialist governments in South America, under threat from imperialist meddling in their internal affairs, permitted to develop an attitude of solidarity that did not exclude critical observation.

The various meetings and exchanges strengthened the realization among activists that since capitalism does not have frontiers so our struggles must be strengthened on the international level, against policies of indebtedness pandering to imperialism and against all forms of exploitation and oppression.
HASTA LA VICTORIA SIEMPRE!!!

Translated by Mike Krolikowski, Vicki Briault and Christine Pagnoulle.