Latest Developments, December 7

In the latest news and analysis…

African pivot
The Wall Street Journal reports the Obama administration is considering asking congress for authorization to “pursue extremist groups” in Africa:

“The move, according to administration and congressional officials, would be aimed at allowing U.S. military operations in Mali, Nigeria, Libya and possibly other countries where militants have loose or nonexistent ties to al Qaeda’s Pakistan headquarters. Depending on the request, congressional authorization could cover the use of armed drones and special operations teams across a region larger than Iraq and Afghanistan combined, the officials said.”

Safety second
Bloomberg reports that Walmart last year dismissed as too expensive safety improvements at garment factories in Bangladesh, where more than 700 textile workers have died since 2005:

“At the April 2011 meeting in Dhaka, the Bangladesh capital, retailers discussed a contractually enforceable memorandum that would require them to pay Bangladesh factories prices high enough to cover costs of safety improvements. Sridevi Kalavakolanu, a Wal-Mart director of ethical sourcing, told attendees the company wouldn’t share the cost, according to Ineke Zeldenrust, international coordinator for the Clean Clothes Campaign, who attended the gathering. Kalavakolanu and her counterpart at Gap reiterated their position in a report folded into the meeting minutes, obtained by Bloomberg News.
‘Specifically to the issue of any corrections on electrical and fire safety, we are talking about 4,500 factories, and in most cases very extensive and costly modifications would need to be undertaken to some factories,’ they said in the document. ‘It is not financially feasible for the brands to make such investments.’ ”

Drug shortage
Reuters reports that international sanctions against Iran may be precipitating a healthcare crisis:

“Government hospitals and pharmacies report a widespread lack of drugs to treat cancer, multiple sclerosis, blood disorders and other serious conditions. Iranian media highlighted the shortages earlier this month through the case of a teenager who died of hemophilia after his family failed to find his medicine.
Both the United States and the European Union say their embargoes do not target trade in humanitarian goods. But cutting off Iran’s banking system from the outside world has touched every sector of the economy, resulting in spiraling food prices, a plunging Iranian rial, deepening unemployment and now, hitting health care, analysts and traders say.”

Unfair shares
Reuters also reports on a study that found that nearly 20 years after the end of apartheid, South Africa’s black majority “directly owns” less than 10 percent of the country’s main stock market:

“Despite the ruling African National Congress’ drive for ‘black economic empowerment’, under which firms are set black ownership and other targets, millions of blacks remain trapped in poverty and excluded from the formal economy.

‘If you look at the demographics of this country, what would be normal is that no less than 50 percent of the JSE (Johannesburg Stock Exchange) should be owned by black people,’ ANC spokesman Keith Khoza said.”

Europe beyond aid
The Center for Global Development’s Owen Barder writes that Europeans may “more than pull their weight in aid to developing countries” but that does not mean they shine at development cooperation:

“So if European countries are serious about development – and not just giving aid – then we must also consider how European policies on trade, investment, migration, environment, technology and security all affect the developing world.
Improvements in any of these policies could have much more impact on poverty and prosperity in poor countries than any increase in the quantity or quality of aid we are likely to make.  Taken together, they are far more important than aid for creating the conditions for development. Yet they get relatively little attention in development circles.”

Legal first
The Jakarta Globe reports that an Indonesian anti-corruption court has made a Japanese businessman the country’s “first foreign graft convict”:

“[Shiokawa] Toshio, the president director of Onamba Indonesia, was proven guilty of bribing Imas Dianasari, an ad hoc judge with the Bandung Industrial Relations Court, over a labor dispute case involving the electrical wire manufacturer.
The court ruled in favor of the company and allowed it to discontinue the employment of workers who had joined a labor strike, shortly before Onamba’s human resources manager Odi Juanda gave Imas the Rp 200 million [US $20,800] bribes.”

Conflicting rights
The International Federation for Human Rights (FIDH) has released a report on a case of industrial pollution in Peru that “illustrates the conflict between international human rights law and investors’ protection”:

“People from La Oroya have brought a case against the State of Peru for failing to protect their right to health, before the Inter-American Commission. Parents of children with high blood lead levels have attempted to get redress in the US, where the parent company is located through a class action. In an attempt to stop the proceedings before the US Court of Missouri, at the end of 2010, the Renco Group launched an international artbitration claiming its rigths as a foreign investors, guaranteed by the Free-Trade Agreement between Peru and the United States, had been violated by Peru, and asking for at least 800 million USD as compensation.”

Congo’s riches
Bloomberg offers a portrait of Israeli billionaire Dan Gertler whose investments in the DR Congo have left him with a hand in nearly a tenth of the world’s cobalt production, as well as “a roster of critics”:

“His Gibraltar-registered Fleurette Properties Ltd. owns stakes in various Congolese mines through at least 60 holding companies in offshore tax havens such as the British Virgin Islands.

‘Dan Gertler is essentially looting Congo at the expense of its people,’ says Jean Pierre Muteba, the head of a group of nongovernmental organizations that monitor the mining sector in Katanga province, where most of Congo’s copper is located.
‘He has political connections, so state companies sell him mines for low prices and he sells them on for huge profits. That’s how he’s become a billionaire.’
In the eight months preceding November 2011 elections, in which [Joseph] Kabila won a second five-year term, companies affiliated with Gertler bought shares in five mining ventures from three state-owned firms, according to minutes of board meetings, company filings and documents published later. The state companies didn’t announce the sales.”

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