Latest Developments, August 9

In the latest news and analysis…

Pharma bribes
The Washington Post reports that pharmaceutical giant Pfizer has agreed to pay $60 million in fines over US charges that its subsidiaries bribed doctors and health officials in “about a dozen countries“:

“ ‘Pfizer subsidiaries in several countries had bribery so entwined in their sales culture that they offered points and bonus programs to improperly reward foreign officials who proved to be their best customers,’ said Kara Brockmeyer, who heads the SEC unit that enforces the Foreign Corrupt Practices Act, which makes it a crime to bribe foreign government officials.”

Private security misconduct
The Associated Press reports that the private military company formerly known as Blackwater – now called Academi LLC – has agreed to pay a fine to settle 17 criminal charges, including arms smuggling:

“The list of violations includes possessing automatic weapons in the United States without registration, lying to federal firearms regulators about weapons provided to the king of Jordan, passing secret plans for armored personnel carriers to Sweden and Denmark without U.S. government approval and illegally shipping body armor overseas.

‘For an extended period of time, Academi/Blackwater operated in a manner which demonstrated systemic disregard for U.S. Government laws and regulations,’ said Chris Briese, Special Agent in Charge of the Charlotte Division of the FBI.”

The New York Times reports that a Singaporean diplomat has suggested Europe could benefit from showing greater humility in its relations with other regions:

“ ‘The problem is that Europe sees itself as a ‘normative power,’ as a region which sets the universal norm,’ said [Singapore’s Ambassador-at-Large, Tommy] Koh in a speech marking the 15th anniversary of the Asia-Europe Foundation.

“This role often makes Europe a very poor interlocutor because its mission is not to appreciate alternative views but to impose its view on the world,” said Mr. Koh.

‘I wonder if the day will ever come when Europe will be humble enough to want to learn from Asia,’ he said, singling out the continent’s experience in dealing with multiculturalism, a challenge facing Europe.
He had heard three European leaders declare that multiculturalism was “a failure,” he said.
“I wish that their advisers had suggested that they should visit Southeast Asia to see how other countries have made a success of multiculturalism,” said Mr. Koh.”

Don’t call it a war
Obama administration counterterror chief John Brennan’s description of current American policy in Yemen sounds awfully familiar, according to Wired’s Danger Room blog:

“If you put the U.S. approaches to Iraq, Afghanistan and Pakistan into a blender, the frothing mixture that emerged would be Yemen policy. Brennan didn’t come close to conceding that the U.S. is at war in Yemen during a Wednesday talk at the Council on Foreign Relations in Washington. Rather, Brennan took pains to describe President Obama’s approach to Yemen as a giant development effort — although it’s the type of economic improvement initiative that involves robots of death circling overhead.”

Do no harm
Médecins Sans Fronitères’ Judit Rius Sanjuan argues US enthusiasm for the proposed Trans-Pacific Partnership threatens America’s own stated global goal of an AIDS-free generation:

“For example, the U.S. government wants TPP countries to lower the bar for patentability, thereby granting pharmaceutical companies new patents on variations of old drugs with little therapeutic benefit for patients. These provisions could stifle the production of less expensive generic forms. And, the U.S. would make it impossible to challenge a patent’s validity before it is granted – a commonly used tool that helps to prevent frivolous and unwarranted patenting and which is vital to fostering an IP system that rewards innovations benefiting patients. The U.S. demands also extend patent monopolies beyond the traditional 20-year period and make it harder for generics to get regulatory approval, which will serve to keep generics out and prop up drug prices for longer.”

Fuel on the fire
The Guardian’s Seumas Milne contends that foreign intervention is now “driving the escalation of the conflict” in Syria:

“Many in the Syrian opposition would counter that they had no choice but to accept foreign support if they were to defend themselves against the regime’s brutality. But as the independent opposition leader Haytham Manna argues, the militarisation of the uprising weakened its popular and democratic base – while also dramatically increasing the death toll.

But intervention in Syria is prolonging the conflict, rather than delivering a knockout blow. Only pressure for a negotiated settlement, which the west and its friends have so strenuously blocked, can now give Syrians the chance to determine their own future – and halt the country’s descent into darkness.”

Delusions of altruism
Jawaharlal Nehru University’s Jayati Ghosh takes aim at US Secretary of State Hillary Clinton who implied in a speech last week that China is using Africa for its resources:

“Certainly, there is more than an element of truth in such warnings. Yet US and European companies continue to try to exploit these countries’ resources as much, if not more, not least through land and other resource grabs. If anything, their concern now is that competition from Chinese and Indian (and even Brazilian and Malaysian) firms is forcing them to offer better terms for their resource extraction. As some Africans put it, it is better to have competing imperialists in action, to allow the objects of interest to play them off against one another. For northern capital used to treating so much of the less developed world as its happy hunting ground, this comes as a nasty shock.

So, please, let’s get real about western ‘help’ to Africa and other poor countries. Most of the developing world has already seen through it, so perhaps it’s time for people in the north to stop deluding themselves?”

Fighting the resource curse
Columbia University’s Joseph Stiglitz urges governments in resource-rich countries to stand up to foreign mining companies so that economic benefits can flow to their citizens:

“Well designed, competitive, transparent auctions can generate much more revenue than sweetheart deals. Contracts, too, should be transparent, and should ensure that if prices soar – as they have repeatedly – the windfall gain does not go only to the company.
Unfortunately, many countries have already signed bad contracts that give a disproportionate share of the resources’ value to private foreign companies. But there is a simple answer: renegotiate; if that is impossible, impose a windfall-profit tax.

Companies will tell Ghana, Uganda, Tanzania, and Mozambique to act quickly, but there is good reason for them to move more deliberately. The resources will not disappear, and commodity prices have been rising. In the meantime, these countries can put in place the institutions, policies, and laws needed to ensure that the resources benefit all of their citizens.”

Latest Developments, November 17

In the latest news and analysis…

Mali’s land rush
The Guardian reports on a new study that found foreign investment in Mali’s arable land, much of which has been worked for generations by farmers with no formal ownership rights, increased by 60 percent from 2009 to 2010.
“The bulk of these land deals – covering an area the report says could sustain more than half a million small farmers – were negotiated by just 22 foreign agri-investors. Less than 5% of west Africa’s largest country is arable.

The report levels significant blame on the World Bank, which it says has ‘shaped the economic, fiscal and legal environment of Mali in a way that favours the acquisition of vast tracks of fertile lands by few private interests instead of bringing solutions to the widespread poverty and hunger plaguing the country’.”

Zambia doubles up on miners
The Centre for Trade Policy and Development has welcomed the Zambian government’s proposal to double royalty rates on mining companies to six percent.
“Our analysis of the mining sector’s tax payments, its contribution to employment and supporting backward and forward linkages to local supply chains reveals that these are not commensurate to the levels of incentives and concessions that the government currently gives to the industry. The cost structure of most of the mining entities is weighted to promote shifting of profits outside the country through such schemes as transfer pricing, use of derivatives and thin capitalization,” according to CTPD’s Savior Mwambwa.

Air battle
Reuters reports that Nigeria is fining two British airlines for overcharging on flights between the two countries, claiming flights from the UK to nearby Ghana are considerably cheaper.
“’We are charging British Airways $135-million and Virgin Atlantic $100-million for abuse of a dominant position, fixing prices, abusing fuel surcharges and taking advantage of passengers,’ said Harold Demuren, director-general of Nigeria Civil Aviation Authority (NCAA).
‘We have been investigating for the last six months. Lagos to London has the highest route yield in the world. Our market is open for exploration, not exploitation.’”

Generic pressures
The Inter Press Service reports that even though there are international mechanisms – such as the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) and Public Health laid out in the Doha Declaration of 2001 – that theoretically enable poor countries to prioritize public health over intellectual property rights, important obstacles to generic treatments persist.
“Surprisingly, very few developing countries, including South Africa, have amended their Patent Acts to make use of the possibilities the Doha Declaration provided – mainly due to international pressure from the pharmaceutical industry, the United States and European Union, where many of the world’s patented drugs are manufactured, health experts argue.”

Green economics
The International Institute for Environment and Development’s Kate Munro says green economics has yet to “leap the chasm that divides it from mainstream economic thinking” but it is gaining political traction in “developing” countries.
“However as the [New Forests Company] project in Uganda illustrates, the wide range of activities that can fly the green flag currently includes development projects with major negative social impacts. Such cases risk leaving popular audiences in developing countries unconvinced that green economics really can provide solutions to the problems they face, such as poverty, inequity and a lack of social justice.”

Understanding the Western brain
Saleemul Huq of the International Centre for Climate Change and Development at the Independent University, Bangladesh has some tips on how the Climate Vulnerable Forum should present its message if it wants to get the attention of policy makers in rich countries.
“The most important factor is the high level political strategy and messaging. Firstly, it is time to stop repeating that we are the most vulnerable and not responsible for the emissions that cause climate change. While this remains true, it is not new (we have repeated it ad nauseum) and so attracts no media attention. Nor does it find resonance among the developed countries, as they find the accusatory tone unpalatable. It is therefore time to drop the tone of “victimhood” and move on to a more positive message as follows:
Even though we are the most vulnerable and lowest emitters, we are nevertheless prepared to do what we can to reduce our own emissions of Green House Gases (GHGs) because every ton of carbon dioxide, regardless of whether it is produced in Bangladesh, China, or USA, causes the same amount of climate change. Therefore, reducing a ton of carbon dioxide contributes as much to the solution, whether it is done in Bangladesh, China or USA. We, as most vulnerable countries, are prepared to do our best to reduce our emissions and encourage and recommend other to do all they can do as well, whether or not there is any global agreement.”

Journalistic imperialism
Freelance journalist Stanley Kwenda writes about the experience of filming his own documentary for Al Jazeera after years of working as a fixer for foreign journalists telling stories about his native Zimbabwe even if they had “little or no knowledge of the local landscape or culture.”
“Africa’s story has often been about crises, about war, poverty and hunger but Al Jazeera has established a means through which other stories about Africa can be showcased. Those stories may be about Africa’s problems too, but in telling them ourselves it shows that we understand them and can work to find our own solutions.”

Hunger numbers
Oxfam’s Richard King writes about the dodginess of global hunger estimates and the Food and Agriculture Organization’s ongoing attempts to come up with way to get more reliable numbers.
“But all this will take time to overhaul, and will likely still result in indicators that are more suited to measuring recent chronic food insecurity rather than current acute hunger. For that, we may have to turn to more subjective indicators, such as those in the Gallup World Poll surveys recently analysed by [the International Food Policy Research Institute], in which people were asked: ‘Have there been times in the past 12 months when you did not have enough money to buy the food that you or your family needed?’ (yes or no). This is an imperfect alternative, not least because ‘food’ and ‘need’ are more abstract than counting calories and are likely to be interpreted differently depending on respondents’ location.”

Latest Developments, October 14

In the latest news and analysis…

Responding to Occupy Wall Street
The University of Manitoba’s Hari Bapuji and the University of Massachusetts’s Suhaib Riaz examine the nature of the Occupy Wall Street protests and advise US business leaders on how best to respond.
“So if Occupy Wall Street is leaderless and unfocused, why isn’t it going away? The persistence of the ‘occupations’ is a signal that there is authentic, deep-seated unhappiness with the failings of the U.S. economic system. It’s an indicator that economic inequality is perceived as an important issue — one requiring business’s immediate attention.
The demonstrators are asserting that they are stakeholders in American business, and they’re correct — they are stakeholders, as consumers, as employees, and as citizens affected by the financial system in general. Businesses would do well to accept that fact and engage with the protesters, rather than trying to demonize or dismiss them.”

Constructive criticism
The Globe and Mail reports Mark Carney, the governor of Canada’s central bank and a potential chairman of the Financial Stability Board tasked with reforming international banking rules, has called the Occupy Wall Street and related protests “entirely constructive.”
“In a television interview, Mr. Carney acknowledged that the movement is an understandable product of the ‘increase in inequality’ – particularly in the United States – that started with globalization and was thrust into sharp relief by the worst downturn since the Great Depression, which hit the less well-educated and blue-collar segments of the population hardest.”

International media bias
The Institute for Security Studies’ Arthur Chatora accuses the international media of uneven and perhaps agenda-driven coverage of human rights abuses in the Libyan conflict.
“This biased media coverage raises questions about the credibility of media organisations and their agenda. Is it because the presence of widespread evidence of racially motivated human rights abuses committed by the TNC forces raises moral and ethical questions that challenge the validity of the notion of a “humanitarian war”? The responsibility assumed by NATO and the TNC forces to protect civilian lives from abuse by Gaddafi forces is also questionable, as it appears this mandate does not seem to extend to the protection of black Libyans and African immigrants.”

International legal bias
The International Institute for Environment and Development’s Lorenzo Cotula argues the current international legal regime encourages land grabs in Africa.
“National and international legal developments have strengthened the protection of companies against adverse action by the host government. But much less progress has been made to strengthen the rights of local people. As a result, the ‘shadow’ that the law casts on interactions between large companies and local villagers presents different shades of grey: those already benefiting from greater access to capital, expertise and influence also enjoy stronger rights.”

Tax agreement inequality reports that not everyone is convinced Switzerland’s new tax agreement with India – one of 70 negotiated by the European country since its government pledged to reduce its famous banking secrecy in 2009 – is much more than window dressing.
“‘As seen by the recent cases of Germany and the United Kingdom, a good [double tax agreement] is not enough. These powerful neighbours have already negotiated new agreements which provide easier access to tax information. The Indian government got the maximum it could as an emerging market but influential industrial countries can get more information,’ [according to Alliance Sud’s Mark Herkenrath].
The Alliance Sud specialist said it would be extremely difficult for India to get the tax information it needs via a DTA and the Indian government would have to request an additional agreement for a withholding tax and special information disclosure clauses.”

Intellectual property vs access to medicines
Daniele Dionisio, a member of the European Parliament Working Group on Innovation, Access to Medicines and Poverty-Related Diseases, voices concern about a new plan introduced by the US during last month’s Trans-Pacific Partnership negotiations.
“Taken together, the non-transparent dynamics bound up with TEAM [Trade Enhancing Access to Medicines] compound fear that this initiative would be something that backs big pharma rather than making headway on non-discriminatory access to medicines in developing countries. This is particularly worrying owing to the fact that TEAM will probably play as the basis for future agreements between the US and other developing and developed countries. This concern seemingly harmonizes with a swipe taken by the US rep on 14 September at the WTO trade policy review of India, maintaining that India’s IP trade policy is out of sync with international best practices.”

The business of corruption
ECONorthwest’s Ann Hollingshead uses some real-world examples to take on the US Chamber of Commerce’s contention that the Foreign Corrupt Practices Act is a threat to American business.
“Has an American company never lost a contract in the history of the FCPA because its officers were not allowed to bribe? No. But does the FCPA provide a systematic impediment to American business competitiveness abroad? No. When an American businessman refuses to pay a bribe, it doesn’t mean the official necessarily goes looking elsewhere. As in Mexico, often the FCPA allows for a shift in the business dynamics, changing the playing field for everyone involved. Moreover, as the Argentine case shows, many businesses welcome this assurance and can use it to their benefit.”

Race to the bottom
The Economist looks at the growing movement against tax havens and the relative ineffectiveness of regulations to this point in stopping the race to the bottom.
“One avenue for reform is to place a greater duty on companies to explain what profits they make where. That would help prevent the worst abuses of transfer pricing scams, in which tax havens play a handy role. The muddled Dodd-Frank reforms, passed by Congress in America and now being implemented by regulators, supposedly go some way towards this; so does legislation being drafted in the EU.”

Latest Developments, July 22

In the latest news and analysis…

A new Médecins Sans Frontières report suggests a number of major pharmaceutical companies will no longer provide antiretrovirals at discounted prices to middle-income countries, including ones with large numbers of  people living with HIV, such India, Brazil and Thailand. And while Health Global Access Project’s Brook Baker praises Gilead Sciences for recently becoming the first drug-maker to join the Medicines Patent Pool (MPP) that aims to improve access to affordable HIV/AIDS treatments in poor countries, he argues the move may not have been as philanthropic as it might seem. The agreement excludes many “middle-income countries with a high HIV-burden” and “of the 111 countries included in the geographical scope of the tenofovir MPP license, Gilead has patent applications pending or granted in only 2 of the licensed countries, India and Indonesia.”

In other patent news, World Intellectual Property Organization delegates have wrapped up a week of meetings without completing drafts of treaties to protect genetic resources, traditional knowledge and folklore. A representative of indigenous peoples expressed concern that their voices were not being sufficiently heard.

Britain’s Macmillan Publishers has agreed to a hefty fine for bribes its education division paid in Africa in the hopes of securing contracts. And a confidential government memo dating from 2008 has revealed Canada’s asbestos industry, which critics say endangers the health and lives of people in the handful of poor countries which still import the substance, may be on its last legs due to dwindling reserves.

Somalia’s Al-Shabab militants, who control much of the country, are still blocking a number of aid agencies despite a recent announcement to the contrary and have called the UN’s declaration of famine “pure propaganda” even though the international organization has laid out the specific criteria it uses to make such assessments. The UN secretary general has written a plea for the world community to help the Somali famine’s victims, “the vast majority of them women and children.” Indeed, the photo accompanying the LA Times piece notwithstanding, more than 80 percent of those fleeing Somalia are women and children. This fact has prompted Al Jazeera to ask where the men are, with some suggesting they are being forced to fight in the country’s civil war. Meanwhile, the Guardian’s John Vidal blames the famine, in part, on what he calls an “insidious war” against pastoralists who “produce more and better quality meat and generate more cash per hectare than “modern” Australian and US ranches” but are being squeezed out “by large-scale farming, the expansion of national parks, and game reserves and conservation.”

Al Jazeera also asks if this week’s UN Security Council statement on the threat to global security posed by climate change is “a real opportunity to achieve significant results or an attempt to divert attention from the root causes of the problem and away from the countries that cause global warming and distribute the burden evenly on world nations.”

Council on Foreign Relations president Richard Haass proposes a so-called “restoration” doctrine, by which he means “a U.S. foreign policy based on restoring this country’s strength and replenishing its resources—economic, human and physical.” He says the idea is very different from isolationism in that it involves carrying out an “active foreign policy.” But restoration would mean engaging in “fewer wars of choice” abroad, such as those fought in Vietnam, Iraq and Libya, and making smart cuts to discretionary spending at home. Haass sees restoration as a short-term objective that could lay the groundwork for what he believes should be America’s real foreign policy goal: “integration, which aims to develop rules and institutions to govern international relations and persuade other major powers to see that these rules are followed.”

Reflecting on a new report entitled “Resource Scarcity, Fair Shares and Development,” Oxfam’s Duncan Green argues that both the left and the right argue away the idea of resource limits in their own way. He also says there is an important distinction between the “new scarcity” of planetary capacity and the largely local and socially determined ‘old scarcity’ that has always left poor people on the outside looking in. In his view, most of the scarcities are primarily local and, as a result, “we should be careful about lumping them all together or going too global, especially when it comes to solutions.”

Latest Developments, July 6

In today’s news and analysis…

Joseph Stiglitz says rich countries have learned nothing from the global financial crisis or the failure of earlier austerity measures in Latin America, Asia and elsewhere. But the Nobel laureate’s emphasis on growth and “still further growth” suggests sustainability does not factor into his vision.

Patrick Michaels goes a step further, arguing there are no limits to potential growth, at least when it comes to food production, and it is policies aimed at halting global warming that are killing people: “This “limits to growth” argument is as tired as a farmer at the end of harvest.”

Harvard economist Dani Rodrik lays out his position on the place of democracy in economic policy making: “Ultimately, the question concerns whom we empower to make the rules that markets require. The unavoidable reality of our global economy is that the principal locus of legitimate democratic accountability still resides within the nation state. So I readily plead guilty to my economist critic’s charge. I do want to make the world safe for democratic politicians. And, frankly, I wonder about those who do not.”

One of the architects of the Kimberley Process praises Canada’s stand on blood diamonds, while an editorial (also in Embassy Magazine) refers to asbestos as Canada’s blood diamond after Canada opposed the substance’s inclusion in the Rotterdam Convention’s list of hazardous substances. “So in the same day,” the editorial reads, “Canada stood up for a process designed to save lives and provide accountability in an industry that is wrought with death and hypocrisy, and then took a position of hypocrisy that will contribute to more deaths in developing countries.”

Meanwhile, gold is reportedly fanning the flames of Colombia’s violence. Canada, which is home to a number of the world’s largest gold mining companies, has signed a bilateral free trade agreement which is set to kick in next month. A similar US-Colombia agreement appears stalled for now.

And one final Canadian mining note: The Canadian International Development Agency is teaming up with Teck Resources and the Micronutrient Initiative for zinc treatment in Senegal. Perhaps surprisingly, a spokesperson for watchdog group Mining Watch Canada believes the project goes beyond the kind of “advertising” he says is typical of corporate social responsibility endeavours: “This looks to me like a perfectly positive thing with concrete benefits to children, and it has accountability already built in.”

UNAIDS is praising India’s decision to resist pressure, most notably from the European Union, to adopt more stringent intellectual property protections that would make it more difficult to produce generic HIV/AIDS treatments. “Millions of people will die if India cannot produce generic antiretroviral drugs, and Africa will be the most affected,” UNAIDS executive director Michel Sidibé said. “For me, it is an issue of life or death.”

Marta Ruiz draws attention to a couple of initiatives, one in Africa and one in the Netherlands, intended to rein in abusive transfer pricing by transnational corporations. But the tax news out of the Netherlands is not necessarily all good for poor countries.

A Chinese prosecutor is calling for international cooperation in tackling the “global cancer” of trans-border corruption, the world’s largest mining company has banned “facilitation payments” in order to comply with the UK’s new anti-corruption law, and the World Bank is looking into possible asset recovery in foreign bribery cases.

In case anyone needed a reminder of the problems inherent in trying to establish a one-size-fits-all global justice system, an angry crowd in Egypt wants tough penalties for police officers who used violence against protesters earlier this year, while a woman who lost her home in Cote d’Ivoire’s recent violence has other priorities.

Nigeria’s president worries about his country’s “huge food import bills,” and the Economist asks if housing is the most dangerous asset of all.