Maravi

Moyo endorses bailing out of private companies by govts

COMMENT - So countries should get off aid, but corporations shouldn't?

Moyo endorses bailing out of private companies by govts
Written by Nchima Nchito Jr
Saturday, May 23, 2009 7:45:06 AM

ECONOMIST and author of Dead Aid Dambisa Moyo yesterday said there is nothing wrong with gover nments bailing out private companies to save their economies.

Featuring on Radio Phoenix’s Let the People Talk programme, Moyo said the principle of bailing out companies was sound as long as the reasons behind it were right, citing the US where the government bailed out businesses in an effort to salvage the economy.

She was responding to a question on whether it was right for the government to refuse to bail out Zambian Airways following the suspension of the airline’s operations early this year due to operational difficulties.

“First of all, you have to have resources in order to bail out a company and also as I said, it’s important to understand what the implications of the collapse of one entity will have in terms of ripple effects for the economy as a whole,” she said.

Moyo added that the government could have had its own reasons for choosing what to bail out and when.

“Perhaps a one relatively small airline in the context of the economy may not be something that the government will view as a priority because they are competing needs obviously in the country with respect to education, and health care and so on so the government has to make a choice,” she said.“As I said, this is simply a superficial argument coz like I have just been reading the newspapers to know what’s happening with respect to Zambian Airways and not because I don’t know any intricate details.”

And Moyo said Africans had allowed both local and international media to negatively portray the continent.

“The tendency is to focus on war, poverty, disease and corruption and yet there are so many amazing things about our continent,” said Moyo.

“One of the hard truths is that we are responsible as Africans for tolerating the fact that the world continues to paint us in such a negative way, our leadership I believe should take a stand and say this is not the way we want to be portrayed. You know there are places that are desperately poor like many people in India, the billions of people round the world. Places like China still have significantly large populations of poor people but nobody feels sorry for them.”

Labels: DAMBISA MOYO, HYPOCRISY, NEOLIBERALISM

posted by MrK @ 6:48 AM