Uses and Abuses of African Debt

No phenomenon lasting for a decade deserves to be labeled a “crisis.” It has thus become acutely embarrassing to speak in 1992 of the third-world debt “crisis.” Certainly a chronic condition; arguably a cancer; some even say a conspiracy—but a crisis, no.

The longevity of Africa’s debt is particularly worrisome. It is also bizarre. There seem no valid economic reasons whatever for the rich world to have made Africa drag its debt burden so far, for so long. One can, perhaps, understand why the banks are prolonging the agony in Latin America: they still have some $250 billion in shaky loans outstanding there.’ Banks spent the eighties disengaging from the southern hemisphere, off-loading a signi...