World Council of Churches Office of Communication
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10 December 1998

WCC Eighth Assembly - Press Release No. 28

World Bank loans made on condition that governments cut spending on social services such as health and education have widened the gap between poor and rich, delegates to the World Council of Churches Eighth Assembly were told Wednesday (9 December). Churches are among those urging developing countries to switch back from free-market economies to state-regulated programmes that have the needs of the poor at heart, they heard.

A meeting held during the Assembly's Padare, a three-day programme of 400 events outside the official agenda, focused on finding alternatives to the structural adjustment programmes (SAPs) required by the International Monetary Fund. Participants said that the increased imbalance between poor and rich, women and men, and South and North had convinced everyone except international financial institutions that these economic policies were a liability to society.

As a result of 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 outcome of SAPs, agreed delegates and visitors attending the meeting at Harare, Zimbabwe, was to plunge developing countries further into debt.

Professor Ulrich Duchrow from Germany asked: "What can we do as churches? We can't simply talk from 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.

Dr Molefe Tsele from South Africa said that the Church should pressure states to re-regulate the economy. There should be an attempt to awaken the moral responsibility of transnational corporations, whose primary motive was to make maximum profits without caring about the people and the environment.

Dr Tsele called for development that is driven by domestic demand. He said that 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 concurred with proposals by Professor Duchrow that development should start from the people and then pass through government to the global level. That, said Dr Tsele, was globalisation with a human face.

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

The participant said that economic liberalisation had not just caused bankruptcy and economic upheaval of the individual countries that have applied them, but have also engendered a crisis that is threatening the entire world economic system.

Giving examples, he said that first it was Mexico whose financial system collapsed in 1994-95. The contagion re-emerged with even more vigour in east Asia in 1997, has spread to Russia and parts of Africa and Brazil, and is threatening industrialised countries.

Contact: John Newbury, WCC Press & Information Officer
Press and Information Office, Harare
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E-Mail: WCC media

The World Council of Churches is a fellowship of churches, now 339, in more than 100 countries in all continents from virtually all Christian traditions. The Roman Catholic Church is not a member church but works cooperatively with the WCC. The highest governing body is the Assembly, which meets approximately every seven years. The WCC was formally inaugurated in 1948 in Amsterdam, Netherlands. Its staff is headed by general secretary Konrad Raiser from the Evangelical Church in Germany.