Debt, Poverty and Environment



The burden of external debt carried by the Third World stood, in 1990, at an aggregate figure of $1319 billion.1 The flow of repayments, of both interest and capital on this burden, has created, since 1982, a net transfer of resources from the South to the North, variously estimated at between $228 billion, on Miller’s figures for net transfers 1982–90, or the $418 billion estimated by Susan George for the same period. The latter estimate is the difference between the OECD figure of $927 billion flowing to the developing countries in all forms, including aid, that is, Official Development Assistance (ODA), as well as public and private sector loans, and debt servicing of $1345 billion, paid by developing countries in that period.2 Both Miller and George exclude from their calculations a number of probably unknowable factors such as capital flight and transfer pricing on the part of multinational corporations (that is, overcharging for internal transactions to achieve lower tax liabilities in higher-tax jurisdictions). They also exclude an illegal flow of capital which benefits the developing countries, namely dollar flows arising from trade in narcotic drugs. George highlights the magnitude of the net flow from the poor to the rich, in a striking parallel with the much-admired Marshall Plan. As part of its commitment to the postwar reconstruction of Western Europe, the United States government made available $14 billion at 1948 prices and exchange rates.


Real Interest Rate Transfer Price Debt Crisis Secondary Market Debt Relief 
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    Susan George, The Debt Boomerang (Westview, 1992), pp. xv–xvi. Miller, op. cit., pp. 14–15; figures are based on longer-term debt.Google Scholar
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Copyright information

© Mark F. Imber 1994

Authors and Affiliations

  1. 1.University of St AndrewsUK

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