Latest Developments, October 24

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Happiness is a doughnut
Oxfam’s Kate Raworth makes the case for adding social boundaries to the nine so-called “planetary boundaries” in order to come up with comfort zones or “doughnuts” within which people can live both sustainably and decently.
“[N]on-monetary metrics must clearly be given more weight in policy making. Economic progress cannot be assessed only – or even primarily – in monetary terms (such as incomes per capita and GDP growth rates). Where the edges are, and whether or not we are hitting them, matters for stability and justice. Policymakers must take more notice of, and be more accountable for, the impact of economic activity on planetary and social boundaries, defined in ‘natural’ and ‘social’ metrics, such as species extinction rates, and unemployment rates.”

Inequality matters
The Overseas Development Institute’s Claire Melamed says the Occupy movements have, if nothing else, dragged the issue of inequality into the spotlight and she presents five points to show why it matters.
“Policy change might be becoming more likely.  In sharp contrast to previous protests, the Occupy movement has got a very sympathetic hearing in the press, with even the Financial Times conceding that they have a point.  Could this be the moment that inequality becomes mainstream? ”

Corruption talks
A new World Bank and UN report calls on the world’s governments to do more about corruption and money laundering.
“The report, the Puppet Masters, examines how bribes, embezzled state assets and other criminal proceeds are being hidden via legal structures – shell companies, foundations, trusts and others. The study’s release coincided with a UN conference on corruption in Marrakesh, Morocco, bringing together anti-corruption advocates and representatives from 154 states.”

Mailbox companies
SOMO has released a new report on Dutch bilateral investment treaties alleging so-called “mailbox companies” are using these agreements to sue home countries for billions “for alleged damages to the profitability of their investments.”
“In addition, the majority of the companies availing themselves of the generous investment protections offered by Dutch BITs are so-called ‘mailbox companies,’ companies with no employees on their payroll and no real economic activity in the Netherlands.”

Walking the gender walk
Gender Action’s Elizabeth Arend argues there is an “alarming gap” between the World Bank’s rhetoric on gender equality and its actual investment policies.
“The World Bank’s gender-blind agriculture investments are even more appalling when they are offered in the form of loans, which increase poor countries’ debt burden and often compel governments to slash public spending on health and other social services to service debt. These cuts are devastating for poor women, who not only suffer directly from lack of access to healthcare, but are responsible for the health and welfare of their households.
Poor countries can appeal to the World Bank for debt relief, but only if they demonstrate a track record of adopting bank-imposed “free-market” policy reforms, including privatisation of state-owned enterprises and unilateral reduction of agricultural trade barriers while rich countries maintain theirs. Women inevitably bear the greatest burden when such policy reforms undermine poor countries’ investments in agriculture, health and education.”

Selling repression
In light of a recent Amnesty International report detailing the extent of arms sales to repressive Arab regimes over the last five years, Al-Jazeera asks if the proposed Arms Trade Treaty will really be able to rein in the global weapons trade.
“The human rights group reports that in the five years preceding the Arab spring $2.4bn worth of small arms, tear gas, armoured vehicles and other security equipment was sold to five specified countries that have faced or are facing popular uprisings – Bahrain, Egypt, Libya, Syria and Yemen.
And these sales were committed by at least 20 governments including Austria, Belgium, Bulgaria, the Czech Republic, France, Germany, Italy, Russia, the UK and the US.”

Blackwater and the US Supreme Court
The Leal Times reports former Blackwater security contractors charged with manslaughter over a shooting incident in Iraq that “left more than a dozen civilians either dead or injured” are trying to get the US Supreme Court to hear their case.
“At issue is whether the indictment is tainted from the prosecution’s use of statements the guards were compelled to make in the hours after the shooting in Baghdad in 2007.”

Happy Birthday to UN
UN Secretary General Ban Ki-moon marked his organization’s 66th anniversary by calling for the 193 member states to display “unity of purpose.”
“Global problems demand global solutions,” he said. “They compel all nations to unite in action on an agenda for the world’s people.

Latest Developments, October 21

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World Bank and human rights
The Guardian’s John Vidal reports on fears that the World Bank’s proposed Programme-for-Results lending could be disastrous for human rights and the environment in poor countries.
“According to the proposals, the new instrument would eliminate or greatly dilute 25 existing safeguards and policies. They include those that apply to forced resettlement, natural habitats, physical and cultural resources, indigenous peoples, forests, safety of dams, natural habitats, and environmental action plans. Most of these policies have taken years of pressure by NGOs to secure.
The bank, which lends more than $50bn a year, is one of the world’s largest providers of loans for mega-projects, many of which are particularly damaging to local people, the environment and the climate. If countries wanting to build giant dams, roads, power and water projects are to be largely freed from acting in a socially responsible way, the NGOs fear bank lending could lead to more forced evictions and human rights abuses.”

Deregulation fever
The Tax Justice Network slams the World Bank’s new Doing Business report for assuming that deregulating the business environment is inherently good and accuses it of being unduly influenced by corporate lobbyists.
“This has meant that countries that don’t provide effective worker protection are deemed ‘business-friendly’, while those that try to protect their environment are deemed ‘unfriendly’.
Among the indicators used in the guide is a Paying Taxes Indicator (PTI), and – you guessed it – countries are ranked according to their corporate tax rates. In Bankspeak taxing business is ‘unfriendly’.”

Beyond GDP
The Broker magazine’s Steffie Verstappen summarizes an online discussion in which the contributors agreed that growth and per capita GDP are inadequate indicators of human wellbeing.
“What we need, suggests [executive director of WOTRO Science for Development in The Hague, Henk] Molenaar, is ‘a single, powerful concept to rival growth’ as the driving force behind development. Needless to say, this is not an easy task. Nonetheless, the concept is likely to be found in the social nature of human beings and not in the logic of accumulation and competition. If we want to make a difference, we should start looking at and measuring development as a social phenomenon that is ‘nested in relations rather than individuals’, Molenaar contends.”

Food trade
The International Food Policy Research Institute’s Sara Gustafson welcomes new limits on commodity trading in the US as “a step toward reducing food price volatility and thus food insecurity.”
“Specifically, the new rules limit the number of commodity contracts that any investor can hold in agriculture, energy, or metals contracts. The trade limits, originally mandated in the Dodd-Frank Financial Reform Act which was passed in July 2010, stemmed from worldwide concerns that commodity index and other funds contributed to the 2008 surge in food and fuel prices, and could again be contributing to recent price spikes. The new rules are intended to prevent commodities markets from becoming too concentrated, which can lead to speculation and market manipulation. Under the new limits, a single trader would be allowed to hold spot month positions equal to 25% of the estimated physical deliverable supply of a given commodity.”

Libyan bonanza
The Press Association reports UK Defence Secretary Philip Hammond is pushing British companies to compete for Libyan reconstruction contracts amid expectations the former rebels will be looking to reward the countries that helped them come to power.
“With the military campaign all but over after the death of Muammar Gaddafi and the defeat of what appears to have been the last pockets of resistance, Mr Hammond said sales directors should be ‘packing their suitcases’ for Libya.”

War and peace
The University of Cambridge’s Tarak Barkawi argues it is far too simplistic to think the death of former Libyan leader Moammar Gadhafi’s death will mean the end of that country’s conflict, in part because NATO’s military support meant the erstwhile rebels never had to cooperate  amongst themselves in a way that might have fostered lasting cohesion.
“Diplomats and the UN make tidy distinctions between ‘conflict’ and ‘post-conflict’, upon which their policies are based.
Yet fighting, out in the open or in the shadows, has often preceded and post-dated the official period of hostilities. More fundamentally, there is a continuum between peace and war.”

Out of Iraq
The Associated Press reports US President Barack Obama has announced all American troops will withdraw from Iraq by the end of the year, though several thousand private security contractors will remain.
“Denis McDonough, the White House’s deputy national security adviser, said that in addition to the standard Marine security detail, the U.S. will also have 4,000 to 5,000 contractors to provide security for U.S. diplomats, including at the U.S. embassy in Baghdad and U.S. consulates in Basra and Erbil.
In recent months, Washington had been discussing with Iraqi leaders the possibility of several thousand American troops remaining to continue training Iraqi security forces.
Throughout the discussions, Iraqi leaders refused to give U.S. troops immunity from prosecution in Iraqi courts, and the Americans refused to stay without that guarantee.”

W abroad
The Canadian Centre for International Justice’s Matt Eisenbrandt and the Center for Constitutional Rights’ Katherine Gallagher explain why they believe the Canadian government should have arrested former US president George W. Bush during yesterday’s visit to a Vancouver suburb.
“Canada has ratified the Convention Against Torture and incorporated it into its domestic legislation. Under the global treaty, Canada has the obligation to prosecute a torture suspect present in Canada unless another country seeks the suspect’s extradition to stand trial elsewhere. This is not a matter of discretion. When Mr. Bush is present in Canada, he must be extradited or prosecuted.”

Latest Developments, October 20

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Deregulating Africa
The top headline in the World Bank’s new Doing Business report is Sub-Saharan Africa’s newfound enthusiasm for business-friendly regulations.
“Over the past year a record number of governments in Sub-Saharan Africa changed their economy’s regulatory environment to make it easier for domestic firms to start up and operate. In a region where relatively little attention was paid to the regulatory environment only 8 years ago, regulatory reforms making it easier to do business were implemented in 36 of 46 economies between June 2010 and May 2011. ”

Seed politics
Intellectual Property Watch’s Catherine Saez reports that the Geneva-based International Union for the Protection of New Varieties of Plants is facing calls for greater transparency and protests from farmers over seed policies.
“Protesters’ main concern is the fact that the 1991 UPOV Convention prevents the saving and sharing of farmers seeds. If they originally buy protected varieties, farmers would like to be able to save some of their harvest and share and exchange some of it with other farmers without paying additional royalties.
They claim that original seeds were removed freely from farmers’ fields by breeders. They add that those seeds that were used to engineer new varieties were selected and saved over thousands of years by farmers.”

Connecting the dots
The UN News Centre reports that Secretary General Ban Ki-moon and General Assembly President Nassir Abdulaziz Al-Nasser are calling for a “courageous” blueprint to tackle both world poverty and environmental destruction ahead of next year’s sustainable development summit in Rio de Janeiro.
“Mr. Al-Nasser stressed the need for policy-makers to ‘connect the dots between issues’ so that they develop policies that are ‘coherent, effective and beneficial.’
He added it was vital to ensure that the outcome of Rio+20 ‘is innovative and at the same time practical in its approach to tackling issues of sustainable development and poverty eradication.’”

The everywhere war
The UN News Centre also reports that Christof Heyns, the organization’s top expert on “extrajudicial, summary or arbitrary executions” is calling on national governments to respect international agreements in pursuing their security interests.
“On targeted killings, the Special Rapporteur said the current use of drones and raids into countries where there is not a recognized armed conflict to kill an opponent, such as in Pakistan or Yemen, is highly problematic
While such operations may be designed to hit a particular target, civilian casualties remain, and it is used on such a large scale that it can hardly be described as targeted.
‘The use of such methods by some States to eliminate opponents in countries around the world raises the question why other States should not engage in the same practices. The danger is one of a global war without borders, in which no one is safe,’ stressed Mr. Heyns.”

Sins of omission
Research firm Maplecroft has released a report assessing the worldwide risks faced by businesses of being complicit in human rights violations, with a particular emphasis on countries that are essential the global supply chain, such as China, India and Mexico.
“The ongoing use of forced labour in emerging economies indicates an unwillingness or a critical lack of capacity to address both the symptoms and causes, leaving business to police the problem itself,” according to Maplecroft’s Alyson Warhurst. “Responsible organisations must ensure that they and their business partners are fully compliant with international labour standards or they risk damaged reputations, litigation, investor alienation and reduced profits from consumer backlash and hidden costs relating to reduced productivity linked to adverse working conditions.”

Greasing palms, pumping oil
IRIN reports that even before Uganda begins pumping oil, concerns over the dreaded “resource curse” are growing, due in no small part to the actions of foreign companies.
“Prime Minister Amama Mbabazi has been accused of receiving funds to lobby for oil production rights on behalf of the Italian oil firm ENI, which eventually lost its bid for exploration rights to British firm Tullow Oil. Along with Mbabazi, Foreign Affairs Minister Sam Kutesa and Internal Affairs Minister Hilary Onek are both accused of taking bribes from Tullow Oil worth over US$23 million and $8 million respectively.”

Smokin’ profits
The Wall Street Journal reports Philip Morris International’s third-quarter earnings were up 31 percent, largely thanks to increased sales in Asian markets such as Indonesia and the Philippines.
“The company has sought to increase growth in emerging markets as volumes have slipped in more established European markets. As a result of the volume decline in developed countries, Philip Morris must enact price increases or cut costs to increase or maintain profitability.”

The price of gold
Blogger Tim Hoiland draws attention to a recent Tufts University report on the costs and benefits of Guatemala’s Marlin gold mine, which is owned by Canada’s Goldcorp.
“Overall, the report concludes that, when juxtaposed against the long-term and uncertain environmental risk, the economic benefits of the mine to Guatemala and especially to local communities under a business-as-usual scenario are meager and short-lived.”

Latest Developments, October 19

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The truth about tax agreements
The Tax Justice Network writes that the Cayman News Service “has blown the lid on one of the biggest lies of recent years about tax havens/secrecy jurisdiction” that tax information exchange agreements (TIEAs) bring transparency to tax havens.
“On the face of them TIEAs appeared “fearsome” with one tax authority forcing another to disclose information on foreign nationals, [Mourant Ozannes’s Robert] Shepherd noted, but actually there was a good deal that trust professionals could do to protect beneficiaries and honour obligations of confidentiality, citing a number of hoops that tax authorities needed to go through to extract information. For example, the onshore authority must initially identify the tax payer in question about whom they require the information and equally they must have exhausted all local powers to gain information first.
…
Ziva Robertson from Withers said that there was a big difference between the political will to be seen to be creating TIEAs and the actual economic effect of their implementation.”

Inclusive growth and inequality
The International Monetary Fund’s new economic outlook for Sub-Saharan Africa predicts continued high growth for the region and disputes the apparent disconnect between growth and poverty reduction, while conceding that inequality is rising.
“First, for the region as a whole, the link between poverty and growth is generally weak. But this relationship is considerably stronger for the region’s high-growth countries.
Second, there is evidence of growth having been fairly inclusive in the region’s high-growth countries. We find, for example, that the lowest quartile in three out of the four case studies (Ghana, Tanzania, Uganda) has enjoyed fairly high increases in consumption. But there are signs that in many of these countries higher-income households have enjoyed still higher growth in consumption. This implies some increase in inequality, broadly in line with patterns observed in a number of high-growth Asian countries.”

Malaria vaccine agnosticism
New York University’s Karen Grépin urges caution over the news of a possible malaria vaccine that set off so much excitement earlier this week.
“But as a public health professional, I just don’t think that enough new evidence has been presented for us to think that we found a “game changer” when it comes to malaria prevention and control. The real question, at least in my mind, that is relevant in this discussion is: does this vaccine provide any real lasting immunological protection in the target populations? The interim study was not set up to address this question. The actual full study was but, and I am not entirely sure why, the interim results were published anyway years before the real results of this study are going to be known. I am not the only one who questions the merits of this approach, in the accompanying editorial in the [New England Journal of Medicine] by Nicolas Witte, a true expert in this area, said “there does not seem to be a clear scientific reason why this trial has been reported with less than half the efficacy results available”. But of course we all know it is not always just science that drives most scientific discussions.”

GM food politics
IRIN reports on the ongoing debate over genetically modified food in Africa which finds itself in the middle of an ideological and commercial rivalry between the US and EU.
“A deep mistrust also prevails in Africa, given the fact that two power blocs – the EU and the USA remain divided over GM.
Only one strain of GM maize, Monsanto 810, and one modified potato, have been approved in the EU, and most countries grow neither commercially. Spain accounts for about 80 percent of GMO grown in the EU in terms of land under cultivation, but Austria, France, Greece, Hungary, Germany and Luxembourg have banned all GMO cultivation.
On the other hand, in the USA, where 70 percent of maize is GM, GM food need not be labelled. Some food experts say both the EU and the USA have vested interests in promoting their respective views in Africa, which is seen as a potential market and supplier of either GM or non-GM products.”

Occidentalism
The Overseas Development Institute’s Jonathan Glennie questions the common claim that poor countries will suffer too unless Europe recovers quickly from its current economic crisis.
“But growth in some parts of the world and not others is just as plausible as growth all over the place. Plenty of economists view the rapid growth of Europe and the US in the past two centuries as a cause of impoverishment in other countries, rather than an unrelated consequence of sound economic management and hard work.
While income per capita has grown rapidly in the rich world for the past three decades, from about $14,000 (constant 2000) to about $26,000, it declined in sub-Saharan Africa (from $571 to $507) and stagnated in all low-income countries (at around $240) until things started to get marginally better in the first decade of this century. It is simply not the case that western prosperity is necessarily associated with prosperity elsewhere.”

Commodity bonds
Harvard University’s Jeffrey Frankel argues poor countries that depend heavily on resource exports are vulnerable to market volatility and could benefit from issuing commodity bonds rather than borrowing in dollars.
“The advantage of such bonds is that in the event of a decline in the world price of the underlying commodity, the debt-to-export ratio need not rise. The cost of debt service adjusts automatically, without the severe disruption that results from loss of confidence, crisis, debt restructuring, and so forth.”

Millennium Villages Project transparency
The Center for Global Development’s Michael Clemens and the World Bank’s Gabriel Demombynes argue that the Millennium Villages Project uses evaluation methods that make it impossible to judge whether or not it is having the desired (and claimed) results.
“A critical element of persuasive impact evaluation is that it is independent and transparent. An independent and transparent analysis of its data could make the MVP evaluation more persuasive. The MVP has told us, however, that it will only consider making data available to outside researchers after it has completed publishing all of its work on data collected through 2016. This suggests the MVP will not share any of the data it has collected until roughly 2020, 15 years after the project began.”

Apples to apples
Oxfam’s Duncan Green has posted a World Bank list of the world’s 100 largest economies, which includes countries, companies and cities, thereby prompting a number of apples-to-oranges comments and a subsequent update to the original post.
“Fascinating comment from [the Bretton Woods Project’s] Peter Chowla, pointing out that a better comparison is between government tax revenue and corporate revenue, and when he crunched the numbers (he didn’t include cities), he got only 29 countries in the top 100 – the rest were corporates.”

Latest Developments, October 18

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FDI dangers
Reuters reports international negotiations have not succeeded in producing voluntary guidelines to curb land grabs in poor countries, a phenomenon driven by uncertain markets and a race to the bottom to attract foreign investment.
“Countries who want to attract investment are currently competing with each other to provide buyers with the best deal, such as a low price for land, low taxes, and few demands for employment creation and protection of the local food system, [the U.N.’s special rapporteur on the right to food, Olivier] De Schutter said.
Targeted African and Asian countries would benefit from a common set of guidelines, which would increase their bargaining position and make it easier for them to demand conditions to protect vulnerable land-users, he said.”

Conflict minerals
Reuters also reports on the battle in Washington over the Securities and Exchange Commission’s attempts to implement a legal provision requiring companies to disclose if their products contain “conflict minerals” from the Democratic Republic of Congo.
“Companies and business groups have largely opposed the measure as proposed, saying it captures far too many companies who do not directly manufacture their goods and have little say or knowledge about the origins of the minerals used in their products. They have urged the SEC to implement the plan over time, and also to give relief to companies that use trace amounts of the minerals in question.
But lawmakers, human rights groups and some socially conscious investors have decried the delay in the SEC’s rulemaking process.”

Resource caution
In the midst of all the excitement about Africa’s current rate of economic growth, Oxford economist Paul Collier warns of the dangers of relying on revenues from resource exports.
“The meltdown in commodity prices over the last two months perfectly illustrates the volatility inherent in these global markets. Resource-rich low-income countries are typically highly dependent upon the tax receipts from resource exports for government revenue. The rents on commodity extraction are highly geared on the price and so are even more volatile than prices. Since taxes are designed to capture the rents, government revenue is thus deeply unpredictable.”

Remittance curse
Economist and mathematician David Ellerman suggests remittances can represent a curse in the same way as resource wealth is often thought to do.
“Like the discovery of oil, the flow of remittances back to the sending country will increase income levels but that itself does not amount to economic development. In fact, it may have the opposite effect. Many of the resource-curse arguments apply to the ‘oil wells’ of remittances. The pressure on the governments to facilitate job creation in the sending countries is much reduced when they can export their unemployment problem and even receive a sizable inflow of hard currency in return.”

Intimidating investigation
Oxfam is reporting that people who complained to the NGO of being forcibly evicted to make way for the Ugandan operations of UK-based New Forests Company – as highlighted in an Oxfam report on land grabs released last month – now say they are being intimidated by employees of the company which had promised an independent investigation in the original allegations.
“We have heard from many people in these communities that they are feeling intimidated by the recent actions of NFC, which are totally at odds with the principles of an independent and transparent investigation,” according to Oxfam’s Vicky Rateau. “They have already lost their homes and land and many have been subjected to violent behavior. They need a credible investigation not further pressure.”

Malaria vaccine
The Guardian’s Sarah Boseley reports on a possible new malaria vaccine that has roughly halved the incidence of the disease in trials to this point.
“The arguments over value for money will be starting even now. Donors will want to figure out whether bednets or artimisinin drugs are a better investment than a vaccine that will reduce the number of malaria cases but not stop the disease in its tracks.
Price will be a critical factor in these considerations. [GlaxoSmithKline’s Andrew] Witty says they will do everything they can to get it down. He is looking at the costs involved in manufacturing and supply – even at the price of the vial. He is prepared to offer licences to get the vaccine produced cheaply in India or in Africa itself.”

Feminist development
The Overseas Development Institute’s Jonathan Glennie argues for the reassertion of feminism as the “theoretical underpinning” for women’s rights around the world but cautions against the imposition of cultural values.
“The certainty that has typified feminist struggle in the west, and has been one of the reasons for its great successes, does not often work cross-culturally. Certainty can only arise indigenously – and there are plenty of national feminist organisations across the world that are leading the fight in their own countries, in their own way (see the debate about the Gisele Bündchen adverts in Brazil, for example). In the international sphere, certainty must be replaced with humility about what the answers are and, crucially, a profound openness to learning from other cultures.”

Rejecting happiness
The Center for Global Development’s Charles Kenny thinks the recent craze among politicians to develop happiness measures as policy-making tools is misguided.
“This isn’t to say that politicians shouldn’t care whether their people are happy. But life is complicated and so is what makes up a good one. It is time to give up looking for a single indicator to capture how we’re doing at it.”