Once again some African nations need a hand toward a better future. This time the challenge is debt.
Having largely emerged from the devastating famine with generous help from around the world, Africa now needs creative, international help to ease its mounting debt crisis.
Unlike the famine, there is no obvious photographic subject, such as a mother and child in a relief camp, to show the need for help. But major riots, even coups, and hunger that could turn into famine, are among the consequences that some countries may face if their debt crisis is not solved, a number of analysts say.
Africa's mounting debt is related to years of fallen prices for African exports, a rise in interest rates on loans, and the strong dollar compared to weaker local currencies, according to one World Bank report.
Sub-Saharan Africa has run up a $90 billion debt. Although this total is less than the debt of either Brazil or Mexico, to many African nations the burden has become ``unbearable,'' says Babacar N'Diaye, President of the African Development Bank.
Rescue actions under way - increased lending, postponing of due dates for many of the loans - fall far short of solving the issue, according to analysts at the International Monetary Fund (IMF), the US Department of the Treasury, the African Development Bank, and other government and private agencies.
These experts suggest African debtor nations in trouble need new loans and grants, and a relaxing of repayment terms for old loans. (See proposals in box below.)
Also needed, several experts said, is an overall rescue plan to help Africa get back on its feet.
``My very strong impression is that nobody has really laid out a plan for long-term, sustained economic and social advance in the major countries of sub-Saharan Africa,'' says a veteran analyst of African financial and development issues.
N'Diaye, the African banker, seeks another reform as well: a lowering of protectionist trade barriers by developed nations to make it easier for African nations to export products.
One culprit behind the debt problem: the usually low international prices of many raw materials exported by Africa, including some agricultural products and some metals and minerals. Many African nations depend on one or two raw materials for much of their export income.
Some Africans would like to see the establishment of a guaranteed minimum world price for such items. But this idea has little support.
Some African nations face a dilemma: If they keep up scheduled payments on their debts, they would be using nearly 40 percent of their foreign exchange earnings. (The 13 African nations deepest in debt would be using about 66 percent.) This would not leave enough for purchase of needed agriculture and industry imports.
Debt repayment ``exceeding 20 percent of your export earnings is in the danger zone,'' says Ahmed Abdallah, a Kenyan who is an executive director of the IMF, a major provider of financing for developing nations.
On the other hand, if a nation refuses to pay back its loans, creditors would be reluctant to loan any more, leading to the same short-changing of their own economy. Either way, this could stir domestic resentment and unrest, a decline in living standards and food production.
So most African nations are striking a middle ground based on necessity. Without the fanfare of nations such as Brazil (most recently), or Peru, which have signaled their intention to limit debt repayments, many African nations have been paying only part of their debts.
Unlike the Latin debt, about two-thirds of the African debt is owed to governments and international lending institutions such as the World Bank and IMF, rather than to private banks. The constitutions of these lenders do not allow capital to be rescheduled.
The pattern that has emerged for the African nations with the most pressing debt problems is this: Unable to keep up their nations' payments but needing more loans, African leaders agree to a set of internal economic reforms outlined by the IMF. This acts as a good housekeeping seal for lenders, who then reschedule debts.
These measures are taken based on the theory that the reforms made will spur the economy, leading to growth that enables debts to be paid. Reforms typically include devaluing inflated currency, selling state-run industries, and cutting state subsidies on key staples.
But before the reforms have time to take hold, the rescheduled loans, and their interest, come due. The nations still are not able to pay and more rescheduling follows. The process is not working, most analysts interviewed said.
``To expect African countries to turn around in 12 to 18 months ... is not realistic,'' says James Conrow, deputy assistant secretary of the Treasury.
Needed, says Mr. Conrow, are closer planning between the World Bank and IMF, better coordination among donor nations, and more medium-term (as opposed to short-term) loans for Africa.
There are mixed assesments on whether African nations really are digging in seriously on the reforms. Several analysts said they thought so. IMF director Abdallah is not so sure.
``It is becoming clear that many countries are signing these letters of intent with the IMF [agreeing to reforms] not because they genuinely believe they can make the program work, but because it [the IMF] seems to be the magic key'' to get more loans from governments, Abdallah says.