In the latest news and analysis…
The Associated Press reports on the somewhat vague declarations made at the conclusion of the G8 summit in Northern Ireland:
“G-8 leaders also published sweeping goals for tightening the tax rules on globe-trotting corporations that long have exploited loopholes to shift profits into foreign shelters that charge little tax or none. But that initiative, aimed at forcing the Googles and Apples of the world to pay higher taxes, contained only aspirations, no binding commitments.
And Britain itself stands accused of being one of the world’s main links in the tax-avoidance chain. Several of Britain’s own island territories — including Jersey, Guernsey and the British Virgin Islands — serve as shelters and funnel billions each week through the City of London.”
The Scotsman reports that skepticism remains after UK tax havens promised to “produce action plans” on increasing the transparency of corporations’ true owners:
“[British Prime Minister David] Cameron stepped back from making the new registry of company interests public, amid fears that if Britain acted alone, it would put UK companies at a massive disadvantage to foreign competitors.
Meanwhile, leading tax evasion campaigner Richard Murphy warned of the workload.
He said: ‘The UK’s law on companies filing information – with the register of Companies House and [Her Majesty's Revenue and Customs] – is simply not enforced now. So why on earth do we think this new law will be enforced unless the resources are put into ensuring that it is?’
There were also concerns that the deal with overseas territories would not cover ‘trusts’, which could still be used by firms to hide details.”
While the G8 was talking tough about offshore secrecy, the International Monetary Fund announced that it had opened its Africa Training Institute in a tax haven:
“ ‘Today, we are opening a new chapter in capacity-building in sub-Saharan Africa, thanks to the generous financial contribution and logistical support of the Mauritius government—the host country–as well as financial support pledges from the Australian Agency for International Development and the Chinese authorities,’ IMF representative Vitaliy Kramarenko said at the opening session. The Africa Training Institute’s key objective is to contribute to improved macroeconomic and financial policies through high-quality training, which would ultimately support sustainable economic growth and poverty reduction in sub-Saharan Africa.”
Joint spying operations
The Washington Post reports that the UK government appears not to have been the only one involved in spying on G20 officials during 2009 meetings in London:
“At least some of the documents posted on the Guardian’s Web site contained the logos of the [National Security Agency] as well as Canada’s security agency, suggesting that a portion of the activities were part of joint or shared operations. The documents also indicated that the British were passed information from the NSA, which reportedly was conducting an eavesdropping operation on then-Russian President Dmitry Medvedev.”
Fleecing a continent
The Guardian reports that the African Development Bank’s president, Donald Kaberuka, has said his continent is “being ripped off big time”:
“Kaberuka was addressing the perennial question of foreign corporations extracting Africa’s mineral resources at huge profit for shareholders with scant reward for local populations.
Africa loses an estimated $62.2bn (£40bn) in illegal outflows and price manipulation every year, much of it exported by multinationals. The Africa Progress Panel under former UN secretary general Kofi Annan recently highlighted how the Democratic Republic of the Congo lost at least $1.36bn in potential revenues between 2010 and 2012 due to knock-down sales of mining assets to offshore companies.”
The Age reports that Australian police made the “inexplicable” decision not to investigate allegations that Melbourne-based mining giant BHP Billiton had bribed officials in Cambodia, China and Australia:
“Confidential documents reveal how the [Australian Federal Police] and [the Australian Securities & Investments Commission], with the knowledge of federal officials, mishandled one of the nation’s highest-profile corporate graft cases after US officials referred it to their Australian counterparts in May 2010.
US anti-corruption investigators have been probing BHP Billiton since 2009 – an inquiry that is likely to result in the company receiving a massive fine. But they had told the federal police the bribery allegations were ‘’a matter for Australian authorities’.
It was only recently that a self-initiated internal review led the AFP to reopen the bribery file and initiate a formal investigation.”
The Standard reports that the vice president of Austria’s central bank has been charged with “overseas graft and money-laundering”:
“Wolfgang Duchatczek, as well as top officials from the Austrian Mint and the central bank’s money-printing subsidiary OeBS, were accused of paying bribes to Azerbaijani and Syrian officials bribes to secure contracts between 2005 and 2011. The bribes amounted to 14-20 percent of the value of the contracts. In total, some 14 million euros made their way to Baku and Damascus via offshore accounts, prosecutors said.”
The International Consortium of Investigative Journalists has announced the launch of a new searchable database containing information from “a cache of 2.5 million leaked offshore files”:
“ICIJ’s Offshore Leaks Database reveals the names behind more than 100,000 secret companies and trusts created by two offshore services firms: Singapore-based Portcullis TrustNet and BVI-based Commonwealth Trust Limited (CTL). TrustNet and CTL’s clients are spread over more than 170 countries and territories.
The Offshore Leaks web app allows readers to explore the relationships between clients, offshore entities and the lawyers, accountants, banks and other intermediaries who help keep these arrangements secret.”
Oxfam’s Keith Slack argues that a looming mining rush could make Haiti’s already considerable problems “even worse”:
“As I’ve written previously, Haiti could take some steps now that could help it avoid some of the worst impacts of the ‘resource curse.’ It must be said, though, that past efforts to build government capacity at the same time a new extractive industry develops, as was the case in Chad, don’t inspire much confidence. If Haiti’s economic development is the primary goal here, and given the country’s multiple governance and environmental challenges (severe water contamination, deforestation, vulnerability to earthquakes and hurricanes among them), there’s a heretical notion to some that should seriously be considered.
Leaving the gold in the ground is an option.”