New World Bank loans to Argentina leave British taxpayers on the hook yet again
Last week we heard some passionate arguments being put forward in the House of Commons on the subject of international aid. Some very important issues such as accountability and transparency were raised and we were assured that our government understands the need for scrutiny. We could be certain that every penny paid in foreign aid is now being accounted for, going to worthwhile projects, helping the poorest in the world. The trouble is, these claims really don’t stack up.
This became apparent last week through the prism of World Bank loans. Argentina - which defaulted on its loans for the second time in fourteen years over the summer - is to have new loans of $215 million underwritten by the World Bank. This is despite recent attempts by Argentina to purchase a fleet of 24 Gripen fighter planes, indicating the loans are not exactly well spent (Argentina has the 21st largest GDP according to the World Bank itself), and are not going to the poorest Argentinians.
The UK and the US did vote against the loans, but were overruled. This means whether we like it or not, our money will be underwriting loans given to a prosperous country with a proven track record of ignoring international finance rules.
This is precisely why a recent poll conducted by the TaxPayers’ Alliance shows that 69 per cent of European voters believe that Argentina should be removed from the G20 until it pays back its loans. 78 per cent of people polled support laws that would make countries more accountable for their debts. And here’s a particularly significant finding – 81 per cent of respondents across Europe support the UK government’s decision to no longer provide World Bank funding for Argentina.
This makes it particularly frustrating that the UK was not able to persuade others to vote to the advantage of not just UK taxpayers but also European taxpayers, despite overwhelming pan-European public support for its position. It was also vexing that DfID did not see it fit to share the date of the World Bank vote on the loans with UK taxpayers. This vote was of significant importance to the British public but we were kept in the dark about its timing.
The votes are done, and the loans have been underwritten. We now need to make sure that no more of UK taxpayers’ hard-earned money is wasted on a highly questionable, financially unscrupulous country. It is galling that funds are siphoned off to one of the more prosperous countries in the world in the name of aid, when diseases like Ebola continue to claim lives in Africa.
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