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Latest Developments, August 24

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In today’s news and analysis…

Libya’s rebels are calling for $5 billion in emergency funds to be unfrozen from Gadhafi regime assets. The US is working in the UN on getting $1.5 billion. Of course, as the Globe and Mail’s Eric Reguly writes, it is no secret that Libya has something everybody wants: “By Wednesday it was amply clear that NATO’s mission creep was lubricated by oil.” The question, he says, is “who will get the prizes.” Earlier in the week, a rebel spokesman said they had good relations with an eager bunch of NATO countries but “may have some political issues with Russia, China and Brazil” who were less keen on providing military support against Gadhafi. And although the rebels have pledged to honour all legal contracts, Reguly writes that “Libya is looking suspiciously like an oil war and the countries that delivered the bombs want their rewards.” But human rights NGO Global Witness is calling first for measures “to guard against a Libyan “oil grab” and ensure the Libyan people benefit fully from the exploitation of Libya’s natural resources.” It wants no new oil deals before democratic elections are held, extensive and “concrete” transparency measures, recovery of Gadhafi-regime money stashed abroad and sanctions against banks that sheltered such funds.

Anticipating a possible European oil embargo against Syria, international petroleum companies are not signing any new deals with the increasingly isolated country, which announced the discovery of a new gas field just last week. But for the time being, company executives said they “still had outstanding contracts that were signed months ago, to either supply refined products or buy crude,” according to the Financial Times. Former US Vice-President Dick Cheney took a much harder line with Damascus in his day, as he reveals in his upcoming autobiography that he wanted to bomb Syria in 2007. The New York Times reports he also defends the use of waterboarding in interrogations and is “happy to note” that current US President Barack Obama has not shut down the prison at Guantánamo Bay as promised.

Meanwhile, there is still a famine going on in Somalia and the African Union is holding a “pledge summit” to address the Horn of Africa food crisis. International Foundation for Agricultural Development President Kanayo Nwanze welcomed the intiative, saying Africa cannot wait for other countries to solve its problems: “No nation, no people ever had sustainable growth that sprang solely from external support. Africa’s development must be made in Africa, by Africans, for Africans.”

The UK and Switzerland have agreed on a new deal that would require taxes be paid in Britain on money held in by British citizens in Swiss bank accounts but would preserve the anonymity of the account holders. Drawing a parallel with the tough-on-crime frenzy that has taken hold in Britain since the riots, the Tax Justice Network’s Richard Murphy is livid: “So at a time when the government is demanding respect for the law, high moral standards and responsibility by all in society one group of criminals – those who have deliberately and knowingly broken the law by tax evading in Switzerland – are going to be let off without paying anything like what they owe even in tax, let alone in penalties and interest. What is more, instead of these people being brought before an all night court sitting to make sure justice is done with names and addresses being published for all to see anonymity is instead being guaranteed to those criminals so they can still held (sic) their heads up high in polite society.”

The Canadian Medical Association has denounced the federal government for blocking the inclusion of chrysotile asbestos on a UN treaty’s list of hazardous substances. “This is an important health care issue and a product that causes significant illness and even death,” according to the organization’s outgoing president Jeff Turnbull. “Canada should not be in the business of exporting such a dangerous product.”

The Guardian’s John Vidal says “plans for a US-based investment company to lease up to 1m hectares of South Sudan for only $25,000 a year appears to have stalled following protests by local communities over the potential “land grab“.” But Indian agribusiness investors are showing major interest in Ethiopia, Tanzania and Uganda, where they say there is as much arable land as in their home country. As in South Sudan, however, local populations are expressing misgivings: “No one should believe that these investors are there to feed starving Africans, create jobs or improve food security,” according Solidarity Movement for New Ethiopia’s Obang Metho.

Also writing in the Guardian, Rick Rowden argues that the UK’s Department for International Development’s new emphasis on promoting private sector growth in poor countries fails to distinguish “between the needs and interests of domestic private sector firms and those of foreign investors” and “perpetuates the foggy notion that the needs and interests of the two parties are somehow exactly the same. They are not.” He argues that, in countries where the private sector has taken off over the past decades, domestic companies got help from their own governments, whether in the form of temporary trade protection, cheap credit or R&D investment. But far from encouraging such measures today, the World Bank, the International Monetary Fund and the proliferating bilateral trade agreements between rich and poor countries proscribe them as “bad government intervention.”

Richard Falk, a retired Princeton law professor, argues “the Afghanistan war is being fought against the nationalist Taliban and on behalf of a corrupted and incompetent Kabul regime for political control of the country” and as such is hurting America’s image and giving “extremism a good name” in the region. “Such an analysis yields a single moral, legal and prudential imperative: when foreign intervention is losing out to determined national resistance, leave the country quickly, stop the killing immediately, and declare victory with pomp and circumstance.”

 

Latest Developments, August 16

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German Chancellor Angela Merkel and French President Nicolas Sarkozy met to discuss a way out of the financial crisis currently spreading across Europe. While they spoke of greater integration, they dismissed as premature the idea of euro bonds that would make all members jointly responsible for the debt of each member. The two leaders did, however, propose a tax on financial transactions both to generate revenue and to discourage speculation, but it is far from certain they will have the support necessary to implement it: “Both Merkel and Sarkozy have mentioned the prospect in the past, but resistance from the US and UK — and promises that firms will pull up stakes and do business elsewhere — has held back efforts by any one jurisdiction from pressing ahead,” according to the Wall Street Journal.

While Europe and America struggle with taming massive public debt, Cote d’Ivoire is opting to skip debt payments even though it has sufficient funds to meet its obligations. Perhaps surprisingly, the International Monetary Fund appears to approve of the decision: “I think that [investors] would be happier with a government that missed a few [payments] and made it up later and had a strong recovery, than a government which met its debt service in a timely manner but failed to relaunch the economy,” the organization’s local director told Reuters.

The UN’s World Food Programme acknowledges that some of its aid to Somalia has disappeared but calls the scale of theft recently reported by the Associated Press “implausible.” Calling the food crisis in the Horn of Africa “man-made,” a World Bank economist says controls on local markets are to blame for high food prices that are exacerbating widespread hunger. “Maize is cheaper in the United States and in Germany than it is in eastern Africa,” according to Wolfgang Fengler. Cambridge University’s David Nally agrees the current humanitarian disaster is not a purely natural one but unlike Fengler, believes the world’s powerful countries must share in the blame for what he considers violence: “The portrayal of the passive victim enables NGOs and Western governments to assume the role of rescuer without having to ask uncomfortable questions about their own complicity in the suffering that is unfolding.” Although he stresses that there is no “clearly identifiable agent” responsible for the famine, he believes the global economy and its priorities play a substantial role. Nally concludes by arguing “the more it’s shown that “the sort of thing which happens in that place” is partly an outcome of policies designed in this place, the more responsibility we have to do something about it. When viewing images of starving children or reading about deaths from malnutrition in the daily newspapers, we ought to consider critically the architecture of violence behind the picture or story, not merely the sad abjection of the victim. There is a need, as Susan Sontag once said, to put privilege and suffering on the same map.”

The Associated Press’s Jonathan Fahey writes that the “golden decade” of America’s defense industry has ended and its companies’ shares are likely to continue their downward trend. But one area that may prosper, given the financial and human resources advantages it offers, is the development and manufacture of drones: “The era of manned airplanes should be seen as over,” according to the Brookings Institution’s Michael O’Hanlon. The latest in drone technology is on display in Washington, DC this week at the Association of Unmanned Vehicle Systems International annual convention. And far away from the showroom floor, a US drone strike has reportedly killed four people in Pakistan.

The US pursued 3.5 foreign bribery cases for every one undertaken by the rest of the world during the last decade, according to the new Global Enforcement Report released by Trace International. In other corporate accountability news, the back-and-forth continues following last week’s New York Times op-ed that claimed a piece of American legislation aimed at preventing minerals from fuelling conflicts is actually having a devastating effect on the Democratic Republic of Congo. In a letter to that same paper’s editor, Margot Wallstrom, UN special representative of the secretary general for sexual violence in conflict, argues “the United States government should be commended for its leadership in trying to regulate “conflict minerals” and to starve rebels of the resources and weapons they need to kill and rape.”

The Center for Global Development’s Kimberly Ann Elliott makes a case for imposing so-called Deterrence of Illegitimate Resource Transfers (DIRT) sanctions on Syria. To impose such sanctions would mean to “declare that any new loans to the Syrian government, and new contracts with the state-owned oil industry, are illegitimate and need not be honored by a democratic successor government.” As with normal sanctions, the DIRT variety would aim to diminish the resources of a leader deemed undesirable by the international community (in whole or in part) and to motivate said leader to change his or her ways. But these specialized sanctions would also “spare a future, legitimate government and its people from having to repay an “odious debt” or abide by contracts tainted by corruption” while allowing it to “still retain access to international credit markets.”

Latest Developments, August 3

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The UN has declared three additional famine zones in Somalia – including the refugee camps in the capital Mogadishu – on top of the two areas already considered as such since last month. The famine is expected to spread throughout southern Somalia and persist until December.

The Guardian’s Mark Tran goes through the factors hampering the delivery of emergency food aid in Somalia: lack of funds, hostile Islamist rebels, US anti-terror legislation and corruption. And ABC informs us we can add another item to the list: the Mogadishu offensive launched by African Union and government troops against Al Shabab.

There is also increasing concern about the Ogaden, a predominantly Somali part of southeastern Ethiopia where not even the International Committee for the Red Cross is allowed to set foot. According to the Royal African Society’s Richard Dowden, “ it has been fenced off and closed to outsiders for years because Ethiopia fears it might be infiltrated by anti-Ethiopian insurgents. Atrocities by Ethiopian troops are reported but cannot be verified. If the rest of the region is suffering, the closed Ogaden may be hiding an even larger disaster.” The area is not completely closed off, however, as Canada’s Africa Oil Corp. has just released an update on its exploration activities in East Africa, including the Ogaden where: “Preparations for drilling, including purchase of materials, execution of drilling related contracts, civil works, and environmental permits have commenced.” The Canadians are not alone, as Reuters reports “a surge in requests for exploration rights” in the Ogaden’s 18 oil and gas exploration blocks, which Ethiopia believes “may contain gas reserves of 4.7 trillion cubic feet of gas and major oil deposits” which could be ready for  production in six years.

A Colombian mining union leader has been shot dead by paramilitaries, according to the International Federation of Chemical, Energy, Mine and General Workers’ Unions, which says his own union “had reported threats to its leaders that were believed to be tied to the contested takeover of Frontino by [Canadian mining companies] Modora[sic] and Gran Colombia, and the sacking of all miners.” And Ghana’s Chronicle reports a dispute between inhabitants of the town of Yayaso and Canadian Newmont Mining. The latter claims it is serious about social responsibility and spent nine months working out a compensation package for Yayaso’s inhabitants to relocate. But a number of the villagers refuse to leave and allege that the company has already destroyed several farms and plans to dump mine waste in revered burial sites. There are currently no Canadian laws in place requiring the investigation of domestic companies for alleged wrongdoing overseas. A bill that would have threatened to withdraw public support –  but not to impose fines or prison sentences – for Canadian companies found guilty of such offences was defeated by parliament last fall.

Royal Dutch Shell has agreed to pay compensation that could exceed $400 million for two oil spills in Nigeria, after a class action suit by a group of inhabitants of the Niger Delta. And victims’ families have won the right to sue Chiquita in the US for complicity in torture and killings of employees by Colombian paramilitary groups.

Jewelry giant Tiffany & Co.’s CEO Michael Kowalski writes in the San Francisco Chronicle: “There are places in our nation, belonging to all Americans, that are too special to mine, too special to develop for oil and gas and too special to forever sacrifice for short-term gain.”  It is for that reason, he says, that his company opposes the mining of California’s Bodie Hills as well as the legislation that “would eliminate protections and allow development on more than 43 million acres of America’s most fragile and important lands.” But as the New York Times reported last month, Tiffany & Co. has tried to have gold exempted from US legislation requiring companies to disclose their use of conflict minerals.

Kenneth Epps of disarmament advocacy group Project Ploughshares accuses Canada of having “reversed its previous low-key but constructive role at the United Nations [Arms Trade Treaty] preparatory meetings to become a potential treaty spoiler,” in particular by pushing for exemptions to sporting and hunting firearms. “To work,” Epps argues, “the ATT must adopt high universal standards that would require many states to improve their arms transfer controls to meet these higher standards. A lowest common denominator approach to the ATT, by locking in low global standards, would actually make matters worse.”

And Al Jazeera English tweets: “Now that #Mubarak is on trial, do his foreign supporters owe #Egypt an apology?”

Latest Developments, July 29

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As the Horn of Africa food shortage continues to intensify, most analysts agree that drought is an insufficient explanation for the extent of the crisis. Abdikarim Abdi Buh, writing for the Mogadishu-based news site Raxanreeb Online, blames both rebel group Al Shabab’s leadership and American foreign policy for how bad things have gotten. One the one hand, he believes Al Shabab’s refusal to allow food deliveries to starving people amounts to genocide, but on the other, he says the US government “has no long-term or comprehensive policy towards Somalia other than tactical policies which are geared towards hunting down few Al Qaida individuals.” He calls on “the international community to funnel food aid through the Al Shabab approved agencies to alleviate and mitigate the depth of the famine” while simultaneously trying to strengthen the disastrously week Transitional Federal Government (TFG). But the Rift Valley Institute’s Mark Bradbury argues it was “international support for the TFG that included the provision of weapons and training of its security forces, the assassination of al-Shabaab leadership and overt attempts to deploy aid in support of the TFG” that led to restrictions and violence against foreign aid workers in the first place.

Al Shabab leaders are said to fear foreign NGOs will provide intelligence necessary for further CIA drone strikes, which the US first admitted to carrying out in Somalia last month. But speaking at a security forum in Colorado, former US intelligence chief Dennis Blair “said the administration should curtail U.S.-led drone strikes on suspected terrorists in Pakistan, Yemen and Somalia because the missiles fired from unmanned aircraft are fueling anti-American sentiment and undercutting reform efforts in those countries,” according to Politico. In Blair’s words: “I think we need to change — in those three countries — in a dramatic way.”

At the same time, UK director of Islamic Relief Jehangir Malik writes in the Guardian his organization has mostly been operating within 50 km of Mogadishu, but “on a recent assessment visit to central and southern Somalia we found it safe and practicable for us to scale up our existing operation and help many more families further afield.” And Columbia University economist Jeffrey Sachs is encouraged by the significant role nearby wealthy Gulf countries and the Islamic Development Bank have taken on to help in the current crisis.

Meanwhile, less than two weeks after the US and its allies recognized the rebel Transitional National Council as the “legitimate governing authority” in Libya, witnesses say those same rebels have killed their top military commander and two of his aides. At today’s funeral, the dead man’s son reportedly cried out “We want Moammar to come back! We want the green flag back!” – an outburst described by Associated Press reporters as “a startling and risky display in a city that was the first to shed Gadhafi’s rule nearly six months ago.”

Citing fears of a “race to the bottom,” civil society groups are calling on East African governments to stop offering tax breaks as a way to attract foreign investment, arguing such “incentives hinder the entry of revenue and have no empirical results to prove their efficacy and impact to investment,” according to Uganda’s Daily Monitor. As the Guardian’s Felicity Lawrence writes, poor countries are actually ahead of their wealthier counterparts in terms of understanding the balance of power in international business: “Developing countries, dealing with corporations whose revenue often exceeds their own GDPs, have long been aware of their own lack of power. They are familiar with the way world trade rules have been written to benefit corporations and limit what any one country can impose on them…For an affluent country like the UK, it has come as more of a shock.”

A new study by the Greenlining Institute reveals that 77 of America’s Fortune 100 companies have subsidiaries based in tax havens and the number of said subsidiaries has increased by 44 since 2008. On the flipside, “low-tax jurisdiction” Barbados is suffering from the ailing global economy and is stepping up efforts to attract investment from Canada, a country whose companies account for 31 percent of foreign subsidiaries in Barbados and 78 percent of the international banks. “As an island nation, we don’t have natural resources unless you count sea, sand and sun. We import most of what we consume here, so it’s very important we bring in foreign exchange,” Invest Barbados CEO Wayne Kirton told the Globe and Mail.

In a piece entitled “Offshoring the boat people,” the Economist reports on a new deal between Australia and Malaysia, under which “Australia will send the next 800 boat people who sail into its northern waters to Malaysia. There they will join about 90,000 other asylum-seekers who have been waiting, some of them for years, to have their claims assessed. In return, Malaysia will send 4,000 certified refugees to Australia and receive compensation for the programme’s costs.” In other immigration news, the US State Department has denied entry visas to Uganda’s youth baseball team, the first African squad ever to qualify for the Little League World Series. And Al Jazeera reports Vietnamese children as young as 13 are being trafficked to the UK to work as cannabis-growing labourers and are then treated as criminals when British police raid such operations.

Earlier this week, Global Witness released a report entitled “Pandering to the Loggers: Why the WWF’s Global Forest and Trade Network Isn’t Working” in which the authors claim “the scheme has never, in Global Witness’s opinion, been adequately evaluated in terms of its rules, 
operation, membership and, crucially, its impact on forests.” In the accompanying press release, Global Witness accuses the World Wildlife Federation of “allowing companies to reap the benefits of association with WWF and its iconic panda brand, while they continue to destroy forests and trade in illegally sourced timber.” WWF has responded with a statement from the criticized certification program’s head, George White, who believes the private sector “can be a significant positive force” in protecting endangered forests: “By mainstreaming responsible forestry practices among the forest-related sector, GFTN creates market conditions that help conserve the world’s forests, while providing social and economic benefits for the businesses and people that depend on them.”

The Trade Justice Movement’s Ruth Bergan slams rich countries for their unwillingness to make even minor concessions to poor countries in the decade-old Doha round of world trade talks, which ostensibly aimed to “improve the trading prospects of developing countries.” Lamenting the fact that, to date, the rich countries have not even honoured “their commitment to tackling their own damaging practices,” Bergan argues “that serious and democratic debate on the purpose and powers of the WTO is long overdue.”

Latest Developments, July 26

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A UN mission has observed food and fuel shortages and a “strained medical system” in Gadhafi-held parts of Libya. “Although the mission observed aspects of normalcy in Tripoli, members identified pockets of vulnerability where people need urgent humanitarian assistance,” humanitarian coordinator Laurence Hart said. Despite NATO’s military intervention, the amount of territory controlled by the Gadhafi regime has grown by about 20 percent over the last five months.

Twelve Democratic members of the US Senate have joined their Republican colleagues in opposing the proposed Arms Trade Treaty (ATT) on the basis of a perceived threat to the Second Amendment right to bear arms. “Ratification requires two-thirds of the Senate. So far 57 senators have said they would vote against the treaty, expected to be wrapped up next year,” according to a US News and World Report piece, which also quotes a Republican letter of opposition: “Our firearm freedoms are not negotiable.” The ATT, as currently being negotiated, would apply only to the international transfer of arms.

The UN Conference on Trade and Development has released its World Investment Report for 2011. The top story suggests a world moving towards greater equality, at least among states: “For the first time, developing and transition economies together attracted more than half of global FDI flows.” On the other hand, foreign direct investment is declining in some of the poorest regions, most notably in Africa which saw a nine percent drop in 2010. The report also addresses the current state of corporate social responsibility: “Voluntary CSR standards can complement government regulatory efforts; however, where they are promoted as a substitute for labour, social and environmental protection legislation, or where CSR standards are not based on national or international rules, then these voluntary standards can potentially undermine, substitute or distract from governmental regulatory efforts.”

Speaking in Hong Kong, US secretary of state Hillary Rodham Clinton pushed for “true regional integration” in the Asia-Pacific as opposed to a “hodgepodge of inconsistent and partial bilateral agreements,” the pending US-South Korea trade deal notwithstanding. According to Stewart Patrick of the Council on Foreign Relations, Clinton’s message was consistent with American policy since the end of WWII but: “What is novel in Clinton’s approach is her insistence that developing countries—which have often been granted special treatment—can no longer be exempted from binding rules.”

The UN’s special envoy for the Middle East has told the Security Council: “The Palestinian Authority is ready to assume the responsibilities of statehood at any point in the near future.” But the US, one of five permanent members with veto power, has said it will oppose any attempt by the Palestinians to obtain state recognition from the UN in September.

Following last week’s deadly anti-government protests in Malawi, the Millennium Challenge Corporation, a US government agency, has put on hold a five-year $350 million deal signed with the East African country earlier this year. The US government agency says it will conduct a review before deciding how to proceed, but terminating the agreement is a possibility.

After trying for over a decade, the International Gay and Lesbian Association has gained the right to attend and speak at UN meetings. Support for the group’s consultative status came primarily from Europe and the Americas, as well as Japan, South Korea, India and Mongolia. Opposition came largely from African and Islamic countries, as well as Russia and China.

University of London economist Costas Lapavitsas looks at the lessons to be drawn from earlier debt crises in poor countries. He criticizes policies that protect lenders while pushing the burden of debt onto the public, suggesting a possible remedy whereby an “audit commission could examine public debt for its legality, legitimacy, odiousness and social sustainability, providing grounds for its cancellation.” He also calls for “international co-operation among borrowers” and says “engagement with multilateral organisations, principally the International Monetary Fund, is to be avoided.”

Foreign Policy columnist Charles “The Optimist” Kenny calls for the leaders of Somalia’s militant Islamist group, Al Shabab, to be charged by the International Criminal Court for “crimes against humanity by method of mass starvation.” But at least some of the blame should go to the “modern world system” that has undermined the centuries-old, sustainable pastoralism that is uniquely adapted to producing food in one of the harshest climates on earth, according to Helen de Jode who has edited a book on the topic.

Esther Dyson, CEO of EDventure Holdings, says there are two types of investors: “Venture capitalists want to fund the next Facebook, while philanthropists want to use Facebook to support good causes.” And although she does not expect or want the former to start behaving like the latter, she suggests “they could focus a little more on training new employees rather than poaching them from the competition at inflated salaries.”