June 30, 2005

Bush boosts Africa aid as frantic G8 talks continue

By Mike Peacock

LONDON (Reuters) - Britain called last-ditch talks onThursday to hammer out an agreed agenda for next week's Groupof Eight summit and welcomed Washington's announcement that itwould double aid to Africa over the next decade.

But aid agencies dismissed the sums as paltry and PrimeMinister Tony Blair's twin goals of massively boosting help forthe world's poorest continent and agreeing a strategy to tackleclimate change continued to look elusive.

As part of an effort to double U.S. assistance to Africa by2010, President Bush said he would ask the U.S. Congress tospend $1.2 billion until 2008 to help fight malaria, whichclaims an estimated 1.2 million lives a year worldwide, 95percent of them in sub-Saharan Africa.

But his administration still rejects a far more ambitiousBritish plan for Africa -- an "International Finance Facility"to raise an extra $50 billion in aid up front by issuing bondsusing future development budgets as collateral.

Blair's office seized on Bush's move as proof that Britaincould turn the G8 summit in the Scottish hotel of Gleneagles,which it is hosting, into a historic success.

"(The) announcement today to more than double aid to Africaby 2010 is an important and welcome step and creates realmomentum for a successful outcome," a Blair spokesman said.

Campaign groups were dismissive.

"This is a very modest step forward that is being spun as acolossal leap," said Patrick Watt of ActionAid.

He said the increase from $4 to $8 billion per year overfive years equated to just two days of U.S. military spending.

Washington is also blocking progress on climate change, anissue which even Blair has admitted will be "very difficult."

In a leaked draft text for the summit, the sentences "Ourworld is warming" and "We know that the increase is due inlarge part to human activity" are in brackets, indicating U.S.disagreement by marking them out for possible deletion.

Blair may face a hard choice -- split with his close allyBush and get a strong climate agreement with other G8 membersor stay with him, get a weak deal and be blamed for missing acrucial opportunity.


Pressure is building most strongly over Africa.

Twenty years after organising the Live Aid concerts forfamine aid in Africa, Bob Geldof has persuaded dozens of popacts to grace stages across the world on Saturday in a "Live 8"extravaganza.

It will be watched by hundreds of millions of people andaims to press G8 leaders into doing more to end Africanpoverty.

"We are saying to them don't lower that bar, don't lowerexpectations now, go for the full deal," said Adrian Lovett ofpressure group Make Poverty History.

Britain is hosting last minute talks in London on Fridayand Saturday to twist the arms of reluctant partners.

Officials always meet before summits to thrash out thedetails of proposed accords but it is unusual for hardnegotiations to take place this late, suggesting Blair isunhappy with the degree of accord reached so far.

"We are continuing negotiations because we want to get thebest possible package," said one British official.

One G8 diplomat said leaders faced a stormy summit as Blairshowed little sign of wanting to compromise. Another said theremay even be another round of officials' talks in Gleneaglesnext week, as the summit gets under way, in a last throw of thedice.

"We have come a long way but still have a long way to go,"UK finance minister Gordon Brown told parliament on Thursday.

Brown suggested he could press ahead with his InternationalFinance Facility even without U.S. support, saying he wastalking to European partners in Paris, Berlin and Rome.

Wider agreement is closer on an "IFF pilot" which would usethe same mechanism to free up cash from aid commitments byissuing bonds for immunisation programs.

Brown estimates it will raise an extra $4 billion forvaccines over the next 10 years, saving 5 million lives.

Earlier this month, he and other G8 finance ministersagreed to write off more than $40 billion of debts owed by someof the poorest nations, in what aid groups called a good firststep.

Economic issues will also loom large at Gleneagles as oilprices bump against record highs.

Canada confirmed the leaders would broach the risks of highfuel costs hurting U.S. economic growth or smothering thealready sluggish economies of continental Europe and Japan.

Canadian Prime Minister Paul Martin said he expectedcurrencies also to be discussed, especially the Chinese yuan.