A drain on capital and finance
The ADB’s conditionality-heavy loans have recently taken the form of Development Policy Support Programs (DPSPs) which, in the context of undemocratic governments, are violations of peoples’ sovereignty. DPSP loans are worth hundreds of millions of dollars and identify specific policy outcomes and results as conditions for loan release.
The debt owed to the ADB and other profit-seeking creditors is also a direct and severe drain on the scarce capital and finance of economies in Asia and the Pacific. The most evident loss is how national governments spend large chunks of their scarce budgets on debt servicing at the expense of vital social services of education, health and housing, by privatizing public utilities and other services, and by heavily taxing the people.
Moreover, ADB loans have been used to push the privatization of power, water and health. Policy changes have been imposed and specific projects financed. The main beneficiaries have been foreign capitalist monopolies in the power and water industry and their domestic big business partners.
Meanwhile, the ADB has profited and continued to grow. The ADB’s net income, for instance, has been rapidly increasing despite the global crisis from US$570 million in 2006, to US$765 million in 2007 (34 percent increase), and US$1,126 million in 2008 (47 percent increase).
The ADB’s debt program also creates significant commercial opportunities for companies with about US$5 billion dollars worth of contracts awarded annually for civil works, goods and services aside from about US$175 million being spent annually on various consulting needs.
In the 2003-2007 period the US had the largest value of procurement contracts among donor members at US$1.13 billion followed by Japan (US$1.10 billion), Australia (US$484 million), Germany (US$427 million) and the United Kingdom (US$372 million).
Accountability
People’s organizations have called the ADB a bank for profit and not for development, as its programs are designed to support private sector profits, especially of big foreign capitalist interests, but also the profits of the ADB itself.
According to the tribunal’s organizers, holding the ADB accountable for its past debt misdeeds is a first step towards justice and putting a stop to their destructive and anti-people operations. There must also be a return of payments on these debts as partial rectification of the long-standing injustice of their unremitting servicing. Holding the bank responsible would hopefully pave the way for the repudiation of all illegitimate ADB debts and their absolute and unconditional cancellation. (IBON Features / Posted by (Bulatlat.com))
