number 7, december 11, 1998

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Churches want state to re-regulate markets

By Munetsi Madakufamba

The free market system under structural adjustment programs (SAPs) has widened the gap between the poor and the rich, prompting civil society — including churches — to urge developing countries to revert to state-regulated economies that had the needs of the poor at heart.

Participants in a Padare offering on finding alternatives to (SAPs) said the increased imbalance between the poor and the rich had convinced everyone except international financial institutions that these economic policies were a liability to society.

As a result of these neo-liberal economic policies, said one delegate, countries have seen greater unemployment of workers, displacement of farmers, marginalisation of the poor and concentration of wealth in the hands of a few.

One "achievement" of the SAPs, the delegates concurred, was to plunge developing countries further into a debt crisis.

"What can we do as churches?" asked Professor Ulrich Duchrow, from Germany. "We can’t simply talk to the outside because we are part of the problem and we can therefore be part of the solution.

"The top-down approach failed. What we need now is a bottom-up approach. People should be at the centre of development and not a system that is driven by global forces. We need people-centred development," said Duchrow.

Through SAPs, developing countries have found themselves in a vicious circle of poverty and some have plunged deeper into national bankruptcy, said another participant, adding that the whole record of the SAPs exercise had been the unquestioned irresponsibility of the international financial system.

He said economic liberalisation had not just caused bankruptcy and economic upheaval of the individual countries that have applied them; they have engendered a global financial crisis that is now threatening the entire world economic system.

He gave examples to back up his point. First, Mexico’s financial system collapsed in 1994-95. Then the contagion re-emerged with even more vigour in east Asia in 1997. It spread to Russia, parts of Africa and Brazil, and is now threatening industrialised countries.

The crises have not only wrecked the financial sectors, but have had far-reaching consequences for the real economies of the countries affected. What many viewed as a series of regional financial crises is fast changing into a global economic crisis.

The church, said Dr Molefe Tsele, from South Africa, should pressure the state to re-regulate the economy. He said there should be an attempt to capture the moral responsibility of transnational corporations, whose primary motive was to make maximum profits without caring about the people and the environment.

Tsele called for development that is driven by domestic demand. Globalisation, as espoused by the World Trade Organisation, had resulted in the centralisation of economic issues, much as political matters had been centralised by the UN Security Council, he said.

He agreed with earlier proposals by Duchrow that development should start from the people through government to the global level. That, said Tsele, was globalisation with a human face.

Read other articles in this issue:

Union wants WCC to tackle Mugabe on banning strikes
Padare: the good and the bad story
Africans put their case to the West
Take Black Theology seriously, WCC told
Polygamy issue resolved
African 'gentility, humility' model for next millennium
Africa's gift of Ubuntu
Don't turn other cheek, women victims told
Churches want state to re-regulate markets
Malawi president won't sign death penalty
Chaz is all over the campus

8th Assembly and 50th Anniversary

copyright 1998 World Council of Churches. Remarks to webeditor