The Parliamentary Under-Secretary of State for International Development (Mr. Chris Mullin): Brazil is an upper-middle-income country with very great inequality. Nearly a quarter of the population live in extreme poverty. We believe that there is a great deal that the Brazilian Government can do to resolve the situation and promote sustainable development. We are glad to see that they are making progress, but they still have a long way to go.
We are providing £8 million this year and £10 million next year in technical assistance to promote sustainable livelihoods and health services for poor people in the wider Amazon region, and to support Brazilian efforts to increase transparency of government. We try to maximise our strategic impact by working alongside major programmes such as those of the World Bank and the Inter-American Development Bank, which each commit around $1 billion to Brazil each year.
We all know that Brazil contains some of the world's most sensitive environment, but the people who live there obviously want their economy to develop and become more prosperous. What can we do to help Brazil achieve the right balance in that respect?
Water management is a very important part of sustainable development. What can my hon. Friend do to support the implementation of the new federal water law and the work of the new federal water agency in Brazil? We in this country have considerable expertise in that regard.
I understand that the national water authority to which my hon. Friend referred was set up only in December to implement national policy on water resources. It is therefore a little early for us to comment on its developmental needs, and we have no current plans to develop activities in the water and sanitation sectors.
Our basic strategy is to focus scarce resources where we can have the greatest impact. That generally involves helping the poorest people in the poorest regions to enjoy sustainable life styles. We are a major contributor to, for example, the pilot programme to conserve the Brazilian rain forest.
Brazil is actually quite a rich country, and we believe that it could do much more to help to deal with the huge inequalities in Brazilian society. We are always willing to help, and we think that Brazil has made progress recently under President Cardoso, but we feel that there is a good deal more progress to be made.
Mr. Denzil Davies (Llanelli): Does my hon. Friend agree that although Brazil is correctly designated a developing country, some parts of the Brazilian economy are very developed? For instance, nowadays Brazilian steel is of high quality and, in terms of both quality and cost, it competes very well with western-produced steel. I realise that it is difficult, but will my hon. Friend try to ensure that money is given to Brazil for development only, and not used to develop areas that are already competitive?
Mr. Mullin: I entirely understand where my right hon. Friend is coming from. As I have said, our aid is targeted on the poorest people living in the poorest parts of the country. That does not include help for the development of its steel industry.
Mr. Michael Fabricant (Lichfield): Is the Minister aware of the scam whereby people in Britain have been sold plots of land in northern Brazil, ostensibly to save that land from being developed? If so, he will know that those concerned have been arrested; but what advice can his Department give people in the United Kingdom about buying plots of land to ensure that they are maintained for sustainable development, and not simply for racketeers?
Mr. Mullin: My advice to people in the United Kingdom would be not to buy plots of land in Brazil. Any scams are of course a matter for the Brazilian Government, but we are anxious to ensure before we start giving aid that it is going not to feed a scam but to feed the people who need it, and to help them develop sustainable life styles.
The Secretary of State for International Development (Clare Short): There are 41 countries that are so poor and indebted that, without exceptional help, they will be unable to escape from their debt overhang, to focus Government spending on poverty reduction and to borrow wisely for sustainable development. In 2000, 22 of those countries qualified for exceptional debt relief totalling more than $50 billion. That will reduce their debts by around two thirds, on average. Of the 13 remaining countries, we hope that as many as four will qualify for relief this year, but many others are affected by conflict, and are unlikely to qualify without making progress in ending that conflict and focusing on the needs of the poor.
Mr. Dobbin: Does the Secretary of State agree that, under the present Government, Britain has taken a lead internationally not only in areas of debt reduction, but, more generally, in areas of development? That is because of the Government's increased investment in debt reduction. I believe that that commitment will be on-going. Does she agree that it would be a disaster for development if the Conservative party were to assume power, with its in-built commitment to getting rid of debt reduction and to making cuts--particularly cuts in taxation for the wealthy--which would affect millions of people throughout the world?
Clare Short: I am grateful to my hon. Friend. I agree; I am most proud of the record on debt relief, for which people both in Britain and throughout the world have campaigned, but the big change is that the IMF and World Bank now back countries' strategies for their macro- economies, revenues, debt relief and aid to reduce poverty systematically. We led on that; everyone can be proud of the United Kingdom's general effort.
Mr. Gary Streeter (South-West Devon): The right hon. Lady will no doubt be pleased to know that, now that we have identified £8 billion worth of savings, not a single penny will come from the Department for International Development's budget. I am glad that she raised the matter.
The right hon. Lady will remember that, in March 1999, I raised with her the issue of debt relief for Nigeria. What progress has the international community made in enabling Nigeria to qualify for debt relief? It is, after all, a country of 120 million people, with £30 billion of debt overhang, racked up by a military dictator who has now gone. Is that not an example of where the heavily indebted
Clare Short: I remind the House of the Tory record on development assistance. [Hon. Members: "No!"] I am simply trying to answer the question. We inherited a shrinking aid budget. We have reversed the cuts. I do not believe that the Tories can cut taxes and protect the aid budget: the arithmetic just does not add up.
Nigeria is not an HIPC country. Because it is an oil producer, it is enjoying a big increase in revenues; but it has been dreadfully run under the military dictatorship. Poverty is very great. Major reform is needed, so that its resources can be used beneficially for its people. It has a debt rescheduling agreement with the Paris club. The delay now in Nigeria is in economic reform; it is desperately important that it should reform. It is a big country. Its president has fine motives, but there has been no economic reform as yet, which is very worrying.
Mr. Streeter: I find the Secretary of State's answer very complacent and worrying. If she is not prepared to take effective action on debt relief in Nigeria, will she at least take effective action to ensure that the new Nigerian Government can recover funds that were illegally stashed away by outgoing President Abacha? Several other countries are taking effective action to ensure that those stolen funds are recovered. Why are not the British Government taking effective action to help the poor people of Nigeria?
Clare Short: Every time the hon. Gentleman gets up, he shows his ignorance--so I do not know what will be in that document. For Nigeria to prosper, its oil resources, which have been ripped off by a corrupt elite, thus distorting the country's whole economy, need to be deployed to benefit the people. Debt relief from outside, when Nigeria will not refocus its own resources, would not help the people of Nigeria. The policy that he advocates is foolish and not in the interests of the poor of Nigeria. He should look more closely at the documents that my Department publishes--he might learn something.