§ 39. Ms. Primarolo
To ask the Secretary of State for Foreign and Commonwealth Affairs if he has made an assessment of the impact of the Gulf crisis on developing countries.
§ Mrs. Chalker
The effect will vary widely from country to country and any complete assessment is complicated because of uncertainty of future oil prices. But our tentative assessments, and those of the World bank, suggest that over a full year, many developing countries could suffer direct losses of about 2 per cent. of gross domestic product. A few will be much worse hit. Against that, oil-exporting developing countries will gain—some of them very substantially.
§ Ms. Primarolo
None of us would begrudge aid to any area in the middle east during the crisis. Britain's contribution has taken another £60 million out of its overseas development aid budget, with no hope of compensation. As to the crippling effect on developing economies of rising oil prices, does the Minister accept that article 50 of the United Nations charter provides for such countries to receive international compensation, but that no money is currently available? If the right hon. Lady had a seat in the Cabinet, could not she put her full force behind the argument for establishing a fund to compensate developing economies that will otherwise be crippled?
§ Mrs. Chalker
The resources for eastern Europe are quite separate from those for the developing world, formerly known as the third world. It is clear from our discussions with the International Monetary Fund and the World bank that we shall be able to help many of the countries that have been hit. However, even more 20 important is the agreement that we seek on debt relief, from which some of the worst affected countries could benefit significantly. I refer to the Trinidad terms put forward by my right hon. Friend the Prime Minister—which I hope all countries will support, as they will help nations in need.