Latest Developments, June 4

In the latest news and analysis…

Signing frenzy
The Associated Press reports that “more than 65” countries signed the UN Arms Trade Treaty on Monday, though the US and other major weapons exporters and importers are not yet among them:

“Signatures are the first step to ratification, and the treaty will only take effect after 50 countries ratify it.

What impact the treaty will have in curbing the global arms trade — estimated at between $60 billion and $85 billion — remains to be seen. A lot will depend on which countries ratify it, and how stringently it is implemented once it comes into force.

There have been some problems in harmonizing the translations of the treaty into the U.N.’s six official languages, and [U.S. Secretary of State John] Kerry said the United States looks forward to signing the document ‘as soon as the process of conforming the official translations is completed satisfactorily.’ Once that happens, the treaty would have to be ratified by the U.S. Senate where it is expected to face an uphill struggle because of opposition from the powerful National Rifle Association.”

State of emergency
The Associated Press reports that protesters in Kyrgyzstan have lifted their blockade of a Canadian-owned gold mine, but “tensions remained high”:

“Hundreds of stone-throwing protesters besieged the Kumtor gold mine, operated by Toronto-based Centerra Gold, for several days, demanding its nationalization and more social benefits. They blocked a road leading to the mine and cut power supplies, prompting the Kyrgyz president to introduce a state of emergency in the ex-Soviet Central Asian nation.

On Friday, more than 50 people were wounded and 80 detained in violent clashes between stone-throwing protesters trying to storm the Kumtor mine’s office and riot police, who fought back with rubber bullets and stun grenades.

Trial date
Reuters reports that the International Criminal Court has announced the trial of Kenya’s Deputy President William Ruto, who faces charges of crimes against humanity, will begin on September 10:

“Ruto has said he would abide by ICC rulings and attend hearings in The Hague if ordered to do so, although he has asked to participate by video link.

The ICC faces growing criticism in Africa, with leaders at an African Union summit in Addis Ababa last week urging the court to refer the cases back to Kenya.”

Legal tug-of-war
Reuters also reports that Libya plans to challenge the International Criminal Court’s demand that the son of former ruler Muammar Gadhafi be handed over for trial in The Hague:

“ ‘We will give what is needed to convince the ICC that Libya is capable of conducting a fair trial in accordance with international standards,’ the state LANA news agency quoted Justice Minister Salah al-Marghani as saying.
Libya has challenged the ICC’s right to put Saif al-Islam on trial on the grounds that since it is planning its own proceedings, the international court in The Hague had no jurisdiction because it should intervene only if the local legal system is not up to the task.”

Much ado
The Guardian’s Claire Provost writes that the debate over whether aid is a good or a bad thing, as manifested most recently in the public spat between Bill Gates and Dambisa Moyo, is largely a distraction from more significant tools in the fight against global poverty:

“Others have pointed out that the question ‘does aid work?’ is quite juvenile (in @rovingbandit’s words, it’s like asking ‘does policy work?’).

Aid, while the only international financial flow dedicated to tackling poverty, pales in comparison with the volume of remittances received – and tax revenues lost – by many African countries. Trade rules and migration policies can have just as large – if not larger – impacts on development.”

Perverted justice
As the trial of Bradley Manning kicked off in a Maryland court on Monday, the Guardian’s Gary Younge blasted America’s treatment of the young man who handed over thousands of diplomatic cables to Wikileaks for “people to see the truth”:

“If the leaks laid bare the hypocritical claim that the US was exporting democracy, then the nature of his incarceration and prosecution illustrate the fallacy of its insistence that it is protecting both freedom and security at home. Manning’s treatment since his arrest in May 2010 has involved a number of serious human rights violations.

But it’s not just about Manning. It’s about a government, obsessed with secrecy, that has prosecuted more whistleblowers than all previous administrations combined. And it’s about wars in which the resistance to, and exposure of, crimes and abuses has been criminalised while the criminals and abusers go free. If Manning is an enemy of the state then so too is truth.”

Fallen tycoon
Agence France-Presse reports that an Italian court has sentenced a Swiss billionaire in absentia to 18 years in prison over the asbestos-related deaths of 3,000 people:

“[Stephan] Schmidheiny, who has been referred to by Forbes magazine as the ‘Bill Gates of Switzerland’ for his philanthropy, had been convicted last year over the Eternit case and sentenced to 16 years in prison.
The appeals court said he was responsible for ‘a permanent health and environment catastrophe’ and had violated work safety rules at his facilities.”

Global blockage
Oxford University’s Thomas Hale, Durham University’s David Held and the University of Massachusetts Amherst’s Kevin Young compare today’s seemingly paralyzed “multilateral order” to a road network whose very success has led to crippling congestion:

“We call this phenomenon gridlock, a basket of trends that is today making international cooperation more difficult, even as deepening globalization and interdependence mean that we need global cooperation now more than ever.

Recognizing that gridlock is a general condition of global politics—not just an issue-specific blockage—is an important step toward designing effective solutions. But at the same time, it militates against a hope in ‘silver bullet’ solutions. The problems facing global cooperation are long-term trends, and the solutions are likely to be equally gradual.”

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Latest Developments, September 19

In the latest news and analysis…

Strike over
Reuters reports that workers at Lonmin’s Marikana mine in South Africa have accepted a 22-percent pay increase to end six weeks of deadly labour unrest:

“The Marikana police shootings were the deadliest security incident since the end of white minority rule in 1994 and, for many South Africans, painfully recalled security force massacres of black demonstrators under apartheid.
In all, 45 people died in the Marikana unrest, which spread beyond Lonmin to other platinum firms around Rustenburg and some gold mines.”

Towards transparency
The Wall Street Journal reports that a “key panel of the European parliament” has voted in favour of proposed rules that would require oil, gas and mining companies to declare what they pay to foreign governments:

“Under the proposal approved Tuesday, companies would have to disclose all payments of more than 80,000 euros ($105,000) on a country-by-country basis, and would have to specify how much money was allocated to each project.

The rules approved by the committee would delete a provision in the European Commission legislation that exempted companies from making disclosures barred by the host country.”

Asbestos rebirth
The Montreal Gazette reports that a Canadian asbestos mine is expected to reopen despite the federal government’s decision to stop opposing the controversial mineral’s inclusion on a UN list of hazardous substances:

“Adding asbestos to the hazardous-substances list under the United Nations Rotterdam Convention would require exporting countries to inform importing countries about the hazards of using it, and to include safe-handling and proper precautionary measures.

Although other countries could try to block the addition of asbestos, it is Canada that has worked hardest to prevent that from happening, said Kathleen Ruff, a human-rights adviser to the Rideau Institute.”

Restricting restrictions
IRIN reports on a new study that calls on the World Trade Organization to ensure that poor countries are exempted from the food export restrictions of other nations:

“The WTO allows countries to impose export restrictions and bans as a temporary measure to address critical food shortages. But these restrictions affect poor countries, which buy most of their food supply, in two ways: They push food prices up globally, making it more expensive for poor countries to buy food, and they force food-importing countries to shop for deals long distances away.

In April 2011, the net food-importing developing countries (NFIDCs) submitted an informal proposal at the WTO for a new paragraph to be included in the draft Doha Accord exempting them and the [Least Developed Countries] from export restriction put in place by other countries. UN agencies and most food experts agree that export restrictions influence sharp spikes in prices, helping to drive food prices up during 2007/2008 crisis. At least 23 countries had either banned or imposed restrictions on the export of cereals then, according to the [International Centre for Trade and Sustainable Development] study.
The proposed exemption was not adopted by the WTO.”

Big fish
Agence France-Presse reports that the former head of French oil giant Elf has been extradited to Togo to face a charge of “accessory to fraud”:

“The former Elf CEO was questioned by a Togolese judge for about three hours Monday, following his lightning-fast extradition from Ivory Coast over the weekend.
His legal team had condemned the international transfer, which came the day after his arrest in Ivory Coast’s economic capital Abidjan on Friday as he tried to board an Air France flight to Paris.

[Loik] Le Floch-Prigent, currently an oil industry consultant, has already served jail terms in France for corruption which dated from his time as head of Elf from 1989 to 1993.”

High-frequency trading
The Bureau of Investigative Journalism reports that the UK is “trying to water down” efforts by European politicians to rein in a form of trading widely blamed for increasing volatility:

“Several influential MEPs are determined to clamp down on the use of sophisticated computer algorithms and fast connections to generate profits through huge numbers of high-speed trades, after seeing its role in the notorious 2010 US Flash Crash and the collapse of Knight Capital last month.

Fuelled by fears over potential market shocks and unease that markets appear dominated by speculators, the European parliament is cracking down on the industry through the revised Markets in Financial Instruments Directive (Mifid), which shapes financial markets across the European Union.”

Cookie-cutter justice
Wayne State University’s Peter Henning asks whether deferred and nonprosecution agreements make sense as “the new standard for how the [US] Justice Department deals with criminal conduct by corporations”:

“It seems as if we are coming perilously close to cookie-cutter justice in corporate criminal investigations. Everyone by now knows the drill: turn over the results of an internal investigation, highlight how damaging a conviction would be and then offer to pay the fine and put in place an enhanced compliance program. The press release almost writes itself, but it is the rare case in which senior management pays any price.
Deferred and nonprosecution agreements are here to stay because they give the Justice Department a means to police corporations while mitigating the full impact of the criminal law. They occupy a middle ground between the sledgehammer of criminal charges and giving a company a free pass.”

Asymmetrical delusions
Warwick University’s Robert Skidelsky argues that “current counter-insurgency orthodoxy” has not incorporated the lessons of Algeria and Vietnam:

“Even putting aside moral and legal questions – which one should never do – it is doubtful whether the strategy of torture and assassination can achieve its pacifying purpose. It repeats the mistake made in 1957 by [French General Jacques] Massu, who assumed that he faced a cohesive organization with a single command structure. Relative calm was restored to Algiers for a couple of years after his arrival, but then the insurgency broke out again with redoubled strength, and the French had to leave the country in 1962.
Today, the international community similarly misconceives the nature of the ‘war’ that it is fighting. There is no single worldwide terrorist organization with a single head. Insofar as Al Qaeda still exists at all, it is a Hydra that sprouts new heads as fast as the old ones are cut off. Trying to win ‘hearts and minds’ with Western goods simply corrupts, and thus discredits, the governments established by those intervening. It happened in Vietnam, and it is happening now in Iraq and Afghanistan.”

Latest Developments, April 25

In the latest news and analysis…

Setting a precedent
The Uxbridge Gazette reports on an asbestos-related UK court ruling that the plaintiff’s lawyers say represents a landmark in the fight for corporate accountability.
“Historically, parent companies have been able to avoid any liabilities arising from work undertaken at its subsidiaries, treating them as separate entities where one company cannot be found responsible for the actions of another. Todays (Wednesday) decision will mean that parent companies can be held liable for the practices of their subsidiaries irrespective of the corporate veil, according to Mr Chandler’s legal team.
The judgment, it believes, will not only have far reaching ramifications for companies in this country with subsidiaries in the UK but also multinational companies headquartered in the UK with subsidiaries in developing countries.”

Chief’s letter
The Aboriginal Peoples Television Network reports that Canada’s top First Nations chief, Shawn Atleo, has written a letter to the federal government slamming its lack of consultation over proposed changes to environmental assessments of industrial projects as “unlawful and unconstitutional.”
“At stake but not mentioned in Atleo’s letter is Enbridge’s massive Northern Gateway Pipeline project which is broadly opposed by First Nations. The project, however, is backed by the Conservative government which says piping Alberta bitumen to the British Columbia coast to satiate China’s oil-thirsty economic machinery is in Canada’s national interest.
‘Thirty years after the Constitution recognized and affirmed Aboriginal and Treaty rights, it is an alarming development that Canada would take such steps that will potentially further undermine processes that already do not adequately address clear duties for consultation and accommodation,’ wrote Atleo, in the letter, dated the April 20, 2012.”

Dam tensions
Inter Press Service reports on the labour troubles plaguing hydroelectric dam construction in Brazil.
“A year ago, [trade unionist Altair Donizete de Oliveira] had predicted that unrest would break out again at Jirau because the dam is being built by a consortium controlled by a foreign company, the French utility GDF Suez.
Analysing the factors fuelling the conflicts, Oliveira said ‘Brazilian companies have a heart,’ while foreign firms only use cold logic based on technical considerations. He also mentioned cultural differences.”

Writing about Africa
Morehouse College’s Laura Seay writes that the simple solution to poor Western media coverage of Africa is to follow the BBC model of hiring African journalists.
“There’s no reason that other major media providers couldn’t hire local reporters to improve their coverage as well. Rather than relegating them to second-tier or co-author status, why not hire Africans as country or regional correspondents? A reporter does not have to be Caucasian to provide objective and well-written reporting from the continent, and in many cases, this reporting is more nuanced than that of an international correspondent who spends five days reporting a story. For example, by far the most thoughtful reporting and analysis on Ugandan reactions to the Kony 2012 viral video came not from American journalists, but from Ugandan reporter Angelo Izama who, to the New York Times‘ credit, was able to publish an opinion article in its pages. Why can’t the Times hire Izama or someone equally qualified to report on Uganda full time?”

Post-2015 problem
Anti-poverty activist Lysa John and Oxfam’s Stephen Hale argue the discussion around establishing successors to the Millennium Development Goals is distressingly one-sided.
“Where are the voices of the poor in this process? The conversation at present is overwhelmingly between northern governments and thinktanks. The most glowing achievements in the MDG success story have been the result of social and economic initiatives in the global south. Most believe that traditional donor countries have failed to meet the commitment for aid and partnership spelled out in the infamously catch-all goal eight – to develop a global partnership for development.
This really matters. Unless there is far broader involvement and ownership of the next round of goals, there will be no agreement on them. Developing countries and the ‘emerging’ economies must be co-creators of this process. The UN plans to consult civil society in 50 countries. But civil society groups and coalitions in the south need financial support to help them carry out their own independent reflection and mobilisation on this, not simply an invitation to participate in the UN consultation.”

Many centres
In a Q&A with IRIN, Nobel Prize winner Elinor Ostrom discusses the concept of polycentrism as it relates to managing the planet and its resources.
“Part of my discouragement with the international negotiations is that we have gotten riveted into battles at the very big level over who caused global change in the first place and who is responsible for correcting [it]. It will take a long time to resolve some of these conflicts. Meanwhile, if we do not take action, the increase to greenhouse gas collection at a global level gets larger and larger. While we cannot solve all aspects of this problem by cumulatively taking action at local levels, we can make a difference, and we should.

We need to get out of thinking that we have to be moving the same everywhere. We need to be recognizing the complexity of the different problems being faced in a wide diversity of regions of the world. Thus, really great solutions that work in one environment do not work in others. We need to understand why, and figure out ways of helping to learn from good examples as well as bad examples of how to move ahead.”

Aiming high on the ATT
Oxfam’s Ed Cairns presents a new paper that argues national governments must not compromise in the quest for a tough Arms Trade Treaty at this summer’s UN negotiations.
“But there’s no point in any new regulation unless it works – to make the market operate for the public good. And that applies every bit as much to a UN conference to agree a useful Arms Trade Treaty. The vast majority of governments want an effective Treaty that will have a practical impact on curbing the irresponsible arms deals that fuel human rights abuses or war crimes – or waste a vast amount of money that could be better spent on, say, development. But like every idea for effective regulation, there are those who want to water it down.  On the arms trade, they’re governments like Syria and Iran, and – an odd companion – the US, which may have made a catastrophic error when it insisted that the process to agree the Treaty should be by consensus.”

Latest Developments, December 5

In the latest news and analysis…

Unravelling social contract
A new report by the Organisation for Economic Co-operation and Development says its member countries are experiencing their highest levels of inequality in over 30 years and calls on governments to revise their tax systems so that wealthy individual pay “their fair share of the tax burden.”
“Launching the report in Paris, OECD Secretary-General Angel Gurría said ‘The social contract is starting to unravel in many countries. This study dispels the assumptions that the benefits of economic growth will automatically trickle down to the disadvantaged and that greater inequality fosters greater social mobility. Without a comprehensive strategy for inclusive growth, inequality will continue to rise.’”

Ethiopia’s financial losses
Global Financial Integrity’s Sarah Freitas estimates that Ethiopian losses due to illicit financial outflows amounted to $3.26 in 2009, which was more than the combined value of the development assistance it received and the products it exported.
“What can be done? The first step the international community should take is to hamper the ability of corrupt and tax-evading Ethiopians to launder their money in the global financial system.  This could be accomplished by establishing a global system of automatic exchange of tax information. In this way, Ethiopian authorities could much more easily track the bank accounts their tax evaders have established around the world. Furthermore, the G20 governments could push for an end to shell companies by calling for beneficial owners of all companies, trusts and foundations to be known to government authorities.  This would make it far more difficult for the corrupt and the criminal to hide their ill-gotten gains behind a wall of corporate secrecy.”

SEC contrivances
Butler University’s Mike Koehler, a.k.a. the FCPA Professor, writes about a recent court ruling in New York that pertains to the Securities and Exchange Commission’s practice of resolving cases – whether involving allegations of foreign bribery or not – without requiring an admission or denial of guilt from the defendants.
“In prior cases, Judge Rakoff has said that this policy contributes to a ‘facade of enforcement’ (SEC v. Bank of America) and is a ‘stew of confusion and hypocrisy unworthy of such a proud agency as the SEC.’ (SEC v. Vitesse Semiconductor)
Last week, Judge Rakoff, in denying the SEC-Citigroup settlement, again had pointed words as to the SEC settlement device typically used in FCPA enforcement actions.

‘An application of judicial power that does not rest on facts is worse than mindless, it is inherently dangerous.  The injunctive power of the judiciary is not a free-roving remedy to be invoked at the whim of a regulatory agency, even with the consent of the regulated.  If its deployment does not rest on facts – cold, hard, solid facts, established either by admissions or by trials – it serves no lawful or moral purpose and is simply an engine of oppression.’
Judge Rakoff stated that the ‘SEC, of all agencies, has a duty, inherent in its statutory mission, to see that the truth emerges; and if it fails to do so, this Court must not, in the name of deference or convenience, grant judicial enforcement to the agency’s contrivances.’”

IP enforcement
Intellectual Property Watch reports that a group of civil society organizations has sent a letter to the World Intellectual Property Organization to express concerns over the UN agency’s “approach to enforcement” regarding piracy and counterfeiting.
“The signers highlighted a lack of transparency about WIPO technical assistance activities, the extensive link being made to public health and safety (which they called “questionable and tenuous at best”) as led by industry, and the possibility that WIPO enforcement activities might be undermining existing flexibilities in IP law. Signers included AIDS groups, digital civil liberties groups, and organizations working on development on the ground in countries around the world.”

Asbestos pushing
Canada’s biggest opposition party is criticizing the government for throwing its weight behind the country’s controversial asbestos industry during negotiations for a trade agreement with India.
“In response to questions from [International Trade critic Brian] Masse, the Chief Negotiator for the Canada-India Comprehensive Economic Partnership Agreement admitted Canada is currently working to eliminate tariffs on asbestos exports to India. Currently there is a 10 per cent duty on asbestos exports to India, the world’s second largest consumer of asbestos.
‘We already dump hundreds of thousands of tons of asbestos each year into developing nations – and now we want to make it easier for asbestos magnates to do so?’ said MP Pat Martin (Winnipeg Centre). ‘This is deplorable and Canadians need to let their government know they will not put up with this any longer.’”

Blood diamond casualty
Global Witness has announced it has left the Kimberley Process, a certification program it helped establish in the hopes of cleaning up the international diamond trade.
“The Kimberley Process’s refusal to evolve and address the clear links between diamonds, violence and tyranny has rendered it increasingly outdated, said the group. Despite intensive efforts over many years by a coalition of NGOs, the scheme’s main flaws and loopholes have not been fixed and most of the governments that run the scheme continue to show no interest in reform.”

A greener Green Revolution
In a Q&A with the Inter Press Service, International Fund for Agricultural Development President Kanayo Nwanze calls for a new kind of agricultural revolution.
“The Green Revolution was successful because it focused on very clear messages: increased fertiliser use, increased improved seeds and irrigation. But we found out in the long term that it is not sustainable. So now we need to look for sustainable approaches to production that do not destroy the environment and are available to a wide spectrum of farmers in Africa and in the world as a whole.”

Transnational coordination
University of California at Santa Barbara’s William Robinson argues the current “global political economy can no longer be contained through consensual mechanisms of social control” and predicts a protracted period of conflict.
“It is noteworthy that those struggling around the world have been shown a strong sense of solidarity and are in communications across whole continents. Just as the Egyptian uprising inspired the US Occupy movement, the latter has been an inspiration for a new round of mass struggle in Egypt. What remains is to extend transnational coordination and move towards transnationally-coordinated programmes.

In my view, the only viable solution to the crisis of global capitalism is a massive redistribution of wealth and power downward towards the poor majority of humanity along the lines of a 21st-century democratic socialism in which humanity is no longer at war with itself and with nature.”

Latest Developments, November 23

In the latest news and analysis…

A disturbing precedent
The UN News Centre reports three top officials have issued a statement calling on member states not to adopt a protocol they say would weaken the current ban on cluster munitions.
“‘The protocol that is being discussed will lower the standard set by the [Convention on Cluster Munitions] and fail to address the well-documented humanitarian and development threats posed by cluster munitions,’ [UN Emergency Relief Coordinator Valerie Amos, UN Development Programme Administrator Helen Clark and UN High Commissioner for Human Rights Navi Pillay] stated.
‘If adopted, it will allow the indefinite use of cluster munitions produced after 1 January 1980 that meet certain technical requirements and that are prohibited by the CCM because of the unacceptable harm they pose to civilians.’
The adoption of this protocol would set ‘a disturbing precedent’ in international humanitarian law, creating – for the first time – a new global treaty that is actually weaker than existing international humanitarian law, they added.”

Tahrir ammo
Tree Huging Hoolah provides a “round-up” of weapons and ammunition allegedly being used against protesters in Cairo’s Tahrir Square.
“There seem to be a growing number people in and around the Square angry at being fired on by weapons supplied from countries making nice noises about democracy and restraint in Egypt, and are starting to document markings and specifications of what’s being used. It won’t help stop any violence, but I’m generally in favour of causing a modicum of embarrassment to those governments and companies which continue to supply tools of repression, usually for profit, to those who they well know will use them to violate human rights and repress their own citizens.”

Putting the “lethal” in “non-leathal”
Al Jazeera asks how dangerous the so-called non-lethal weapons being used against protesters around the world really are.
“With over 36 killed in Egypt since November 19, and medical sources citing ‘suffocation after inhaling tear gas’ as the cause of many of the deaths, the non-lethality of the weapons employed – as well as how they were imported – has come under serious question.
Khalid Abdala, an Egyptian actor and activist, told Al Jazeera from Tahrir that he held international governments ‘complicit in everything that is happening here’.
‘International governments have replenished the stocks of bullets that have been shot at people right now, and the tear gas that is clinging to my lungs,’ he said.”

E-waste exports
A new makeITfair report calls on the European Union to ensure revisions to its legislation on e-waste put an end to the export of such hazardous materials to poor countries.
“Electronics waste in industrialized countries is growing three times faster than regular waste – the result of the fast pace of technological innovation and the consequent short life of many electronic products. Up to 50 million tonnes of e-waste containing hazardous substances such as lead, cadmium and mercury are generated worldwide every year. A vast amount of the European e-waste is exported to developing countries such as Ghana, a major hub for European e-waste. This causes pollution and health problems because the country has no adequate infrastructure to deal with the hazardous waste.”

Let them eat processed food
The Guardian reports global food and drink companies are increasingly targeting the world’s poor whom they view as the primary “vehicle for growth” for processed products that increase the risk of diabetes and heart disease.
“As diets and lifestyles in developing countries change, their patterns of disease are following those seen in industrialised countries in the north equally rapidly. But for poor countries there is a double whammy: they have started suffering from high rates of [non-communicable diseases] before they have managed to deal with hunger and malnutrition. The double burden is devastating both their economic growth and their health budgets.”

Free trade impacts
Embassy Magazine reports an environmental assessment of a possible Canada-India free trade agreement will not examine Canadian exports of asbestos to the South Asian giant.
“Canada exported $40.3 million worth of asbestos-related products to India in 2010, according to Industry Canada, and the World Health Organization says asbestos causes an estimated 8,000 deaths each year in India—a phenomenon described in a recent Australian Broadcasting Corporation documentary as an ‘epidemic.’”

Enabling corruption
Global Witness’s Anthea Lawson argues banks in wealthy countries must stop playing an integral part in the corruption that is devastating poor countries.
“Three entrenched, repressive and corrupt regimes fell this year largely because the people they ruled were fed up with epic levels of corruption.
That kind of corruption cannot happen without a bank. Dictators cannot steal millions of dollars from the state, nor accept massive bribes, if the money has to be kept under the bed.
Payments for natural resources like oil and gas do not arrive in dollar bills, they are paid by bank transfer; increasingly, bribes and rake-offs from commercial deals are too. Plus it’s safer to keep money out of the country — away from opponents, and accessible if you’re ousted from power.”

Accounting advice
York University economist Fred Lazar suggests many governments could make their perceived financial difficulties disappear simply by reporting their finances in the same way as corporations currently do.
“For example, many government expenditures are investments – capital expenditures. Expenditures on infrastructure clearly are in this category. Some of the expenditures on training, healthcare, education, R&D (e.g. NASA and the Departments of Defense and Energy in the US), and the judiciary also should be classified as investments, for all of them contribute to enhancing the productive capacity of the economy.
Such expenditures should be excluded in the calculation of the budget balance – the equivalent of a company’s income statement – and instead be included in the government’s cash flow statement, as is the case with investment expenditures by companies. If these expenditures were treated in this manner, most government deficits would disappear immediately, replaced with budget surpluses.”