Latest Developments, September 20

In the latest news and analysis…

Drones in paradise
The Wall Street Journal reports the US military will begin launching armed drones from the Seychelles as it steps up its campaign against perceived terror threats in East Africa.
“The U.S. has used the Seychelles base for flying surveillance drones, and for the first time will fly armed MQ-9 Reapers from the Indian Ocean site, supplementing strikes from a U.S. drone base in Djibouti.”

Radical corporate transparency
A new Publish What You Pay report on 10 major extractive industry companies details the extent to which they rely on subsidiaries in “secrecy jurisdictions” – 2,083 such subsidiaries between the corporations examined – to maximize profits and, according to PWYP, deprive poor countries of massive amounts of income.
“This is why, in order to combat this veil of secrecy, PWYP Norway believes every company should publish their full revenues, costs, profits, tax and the amount of natural resources it has used, written off and acquired in any given year in every country it operates. This is known as country-by-country reporting (CBCR).”

Resource extraction and indigenous rights
The UN’s top expert on the rights of indigenous peoples, James Anaya, has released the results of an extensive questionnaire-based study that suggests natural resource extraction and other major construction projects are having adverse effects on indigenous communities around the world.
“The vast majority of indigenous peoples’ responses, many of which stemmed from the direct experience of specific projects affecting their territories and communities, rather emphasized a common perception of disenfranchisement, ignorance of their rights and concerns on the part of States and businesses enterprises, and constant life insecurity in the face of encroaching extractive activities,” according to Anaya.

Taking the long view
Mongolian President Tsakhia Elbegdorj spoke to Reuters about a law that bans mining in his country’s river and forest areas.
“Half of the territory is covered by exploration licenses. I think that’s enough,” he said.
“We have to save our wealth (for) our next generation.”

Massive Chevron payout looming?
A US appeals court has overruled a lower court’s decision that prevented Ecuadoran plaintiffs from collecting billions in damages (awarded by an Ecuadoran judge) from oil giant Chevron over pollution in the Amazon rain forest.
“In February, a judge in Ecuador ruled that Chevron should pay to clean up contamination in the oil fields where Texaco, bought by Chevron in 2001, once worked. But the company persuaded a U.S. judge to block enforcement, arguing that the verdict was the result of fraud. Chevron even filed a criminal conspiracy case against the Ecuadorans.”

Fraud refund
The Institute for Accountability in Southern Africa’s Paul Hoffman draws attention to a legal precedent he thinks should be relevant to the inquest called last week by South African President Jacob Zuma into a 1999 arms deal that is alleged to have involved bribes from a number of foreign companies.
“These findings, still good law, on the effect of bribes on contracts are the key to obtaining the refund of purchase prices paid to arms dealers who allegedly bribed their way into contention in the arms deals. A R70bn [US$ 9 billion] bonanza for taxpayers is surely a worthwhile endeavour.”

Abetting repression
The BBC reports UK-based Gamma International is denying that it supplied software to the ousted Egyptian regime so that it could monitor online voice calls and emails.
“The files from the Egyptian secret police’s Electronic Penetration Division described Gamma’s product as “the only security system in the world” capable of bugging Skype phone conversations on the internet.
They detail a five-month trial by the Egyptian secret police which found the product had ‘proved to be an efficient electronic system for penetrating secure systems [which] accesses email boxes of Hotmail, Yahoo and Gmail networks’.”

With friends like these…
Development consultant Ian Smillie says Western governments and the humanitarian organizations that serve as “fig leaves covering up the inattention” of the international community will have to start behaving very differently in Somalia if they want to help provide long-term solutions to the conflict-racked, famine-stricken country.
“None of the humanitarians, [the Canadian International Development Agency] included, has anything to say about the roller-coaster involvement of the West in Somalia, alternately arming, then aiding, then invading, then abandoning the country – then supporting an Ethiopian invasion that led to the rise of the extremist al-Shabaab militia and their brutal but entirely logical expulsion of Western aid workers.”

Intellectual property vs. cancer treatment
The Guardian’s Sarah Boseley writes that the UN conference on non-communicable diseases has focused almost exclusively on prevention rather than treatment, an outcome the US and EU lobbied hard to achieve.
“The pharmaceutical industry and its supporters in the EU and US where research and manufacturing takes place are very keen that nobody should get the idea that a declaration which allowed poor countries to bypass patents and obtain cheap copies of normally expensive Aids drugs should in any way be mentioned in the context of NCDs. That might open the doors to developing nations using the legislation to obtain new cancer and heart drugs – which make huge profits for the companies in the rich world.”

Patents around the world
The UN News Centre reports new figures showing the number of international trademark and patent application rose in 2010, though global distribution remains highly uneven.
“The top 10 patent offices accounted for approximately 87 per cent of all [trademark] applications in 2009, with the United States, Japan and China filing about 60 per cent of the total.”

Latest Developments, August 9

In the latest news and analysis…

While London’s riots may not really seem like Beyond Aid material, commentators such as Laurie Penny have highlighted common ground through their accounts of how difficult it is for a society to provide thoughtful analysis of its own culture’s uglier aspects: “The violence on the streets is being dismissed as “pure criminality”, as the work of a “violent minority”, as “opportunism”. This is madly insufficient. It is no way to talk about viral civil unrest.” Similarly, Daniel Hind writes in an Al Jazeera piece it is a mistake to view the riots as apolitical: “We should perhaps ask [the young rioters] what they were thinking before reaching for phrases like “mindless violence“. We might actually learn something.” In the meantime, while stressing he does not wish to “draw a straight line from the decision to bail out the banks to what’s going on now in London,” he provides an assessment of his own: “Those who want to see law and order restored must turn their attention to a menace that no amount of riot police will disperse; a social and political order that rewards vandalism and the looting of public property, so long as the perpetrators are sufficiently rich and powerful.”

Oxfam’s Duncan Green makes no mention of the riots on his blog but does suggest a distance between government priorities and those of the public with his comments on the UK Office of National Statistics’ recently published report “Measuring What Matters”: “Topline results from a big public consultation is that ‘what matters’ are health; good connections with friends and family; present and future conditions of the environment and education and training. Not much of that reflected in our leaders’ fixation on GDP.”

Libyan officials have accused NATO of the “massacre” of 85 civilians. NATO denies the charge, saying there is no such evidence and the overnight air strikes were “legitimate.” The EU has added to its existing sanctions against Libya by targeting two organizations it claims are “directly linked” to the Gadhafi regime. And the US is reportedly preparing to impose new sanctions against Syria and to tell President Bashar Assad he must go.

Self-described social entrepreneur Dermot Egan argues in the Guradian that reactionary corporate social responsibility must give way to social enterprise, which requires that a company to embrace “positive social impact” as its central purpose: “Companies cannot continue to pretend to serve society while simultaneously acting against it. Neither can they continue to give shareholder’s interest primacy above the interests of the public. No amount of investment in charitable causes or employee volunteering can change that fact. The purpose of a company will be to create shared value, where business and society achieve success together.” In the meantime, Wyoming state legislators are considering adopting new measures to combat corporate fraud, including banning the practice of appointing nominee directors which companies can use “to hide the company’s real corporate officers and to help the operators avoid responsibility for the company’s actions,” according to the Wyoming Tribune Eagle. And activists in India are outraged the organizers of the London 2012 Olympic Games have accepted Dow Chemical – the parent of Union Carbide whose pesticide plant was the source of a gas leak that killed thousands in Bhopal, India in 1984 – as a sponsor.

In a statement marking the International Day of the World’s Indigenous People, UN High Commissioner for Human Rights Navi Pillay said large numbers of the world’s indigenous people have lost or risk losing “their ancestral lands, territories and natural resources because of unfair and unjust exploitation for the sake of ‘development.’ On this day, let us ask the crucial question: who actually benefits from this so-called development, and at what cost is such development taking place?” She also called on multinational corporations involved in resource exploitation on indigenous lands to respect human rights, before concluding: “The right to development is a human right for all, and indigenous peoples have the right to define and determine their own development.”  Two of the countries Pillay singled out for their problematic handling of relations between extraction companies and indigenous populations were Canada and Brazil. During the current visit by Canada’s prime minister to Brazil, the two nations set up a committee to deepen bilateral trade,  co-chaired by the CEOs of Brazilian miner Vale and Canada’s Scotiabank which last year helped set up “the largest arms length oil and gas deal in Brazilian history.”

A new Economist Intelligence Unit report predicts the African banking industry will grow 178-248 percent by 2020 “due to huge unmet financial needs in a world largely marked by excessive debt and leverage.” On the subject of excessive debt, Jonathan Glennie argues a debt default by a wealthy European nation could be a good thing for poor countries if , as a result, it became easier for them to repudiate their own dates. He believes it is “morally bankrupt to force poor countries to pay debts while their people suffer in extreme poverty, especially if much of the debt is illegal or otherwise illegitimate.” He does not dispute that default is a difficult and painful process, but wonders if repaying massive debts and the attendant interest might not be worse over the long run. As things stand, creditors dictate repayment conditions. But Glennie would like to see debtor nations have recourse to an independent panel that “would try to ensure that the debtor emerges from the proceedings with good prospects for financial and economic stability. And lenders will know that they can no longer get away with odious or careless lending.”

Latest Developments, August 5

In the latest news and analysis…

Standard &Poor’s has downgraded the US credit rating from AAA to AA-plus for the first time ever. Although a lower credit rating tends to mean higher interest rates, Planet Money’s Jacob Goldstein is not convinced this particular adjustment will have much practical impact, arguing most financial institutions don’t distinguish between the two ratings. Princeton economist Paul Krugman, for his part, is totally dismissive based largely on the agency’s recent track record: “In short, S&P is just making stuff up — and after the mortgage debacle, they really don’t have that right.” But even if there is little domestic impact, a continuation of negligible growth and extremely low interest rates in the US could mean “emerging market economies—Brazil, other strong performers in Latin America, much of Southeast Asia, and even the better performers in sub-Saharan Africa—will continue to experience a flood of capital seeking higher returns, hot money with all the attendant risks of a bubble,” according to the Center for Global Development’s Liliana Rojas-Suarez. And the Guardian reports that bubble may already be about to burst.

Only a month after replacing the disgraced Dominique Strauss-Kahn, International Monetary Fund head Christine Lagarde has learned she will face a criminal inquiry over her roll in a questionable $600 million payment to a political ally. According to the IMF’s website, the “Fund’s approach to combating corruption emphasizes prevention, concentrating on measures to strengthen governance, and limiting the scope for corruption. The IMF also has strong measures in place to ensure the integrity of its own organization.” Nevertheless, the allegations Lagarde faces had been widely reported well before her appointment as the organization’s managing director despite resistance from a number of non-European countries who felt it was time to end that continent’s six-decade hold on the IMF’s top job.

Canadian Prime Minister Stephen Harper sets off this weekend for a four-country Latin American tour that will focus on trade, rights and security, according to Postmedia News. In a recent statement, Amnesty International said many of the hemisphere’s governments are not doing a satisfactory job of balancing these considerations at home: “Countries across the region – including Argentina, Brazil, Canada, Colombia, Ecuador, Guatemala, Mexico, Panama and Peru – have failed to consult Indigenous Peoples before passing laws that would threaten their livelihoods. They also carried out development projects in Indigenous Peoples’ ancestral lands without respecting their right to give free, prior and informed consent.”  And in terms of international relations, the Canadian parliament approved a free trade agreement with Peru  in June 2009, a few days after dozens died in protests over new Peruvian laws facilitating oil and gas exploration in the Amazon.

A couple of telecommunications companies have run up against the US Foreign Corrupt Practices Act. Magyar Telekom, a Hungarian corporation controlled by German Deutsche Telekom, is currently in talks with the Securities and Exchange Commission over possible bribes paid in Macedonia and Montenegro. And a federal jury has convicted two former executives of Florida-based Terra Telecommunications Corp. for authorizing bribes paid in Haiti over a period of several years. Meanwhile, a pair of US lawmakers has proposed legislation absolving non-Americans living outside the US of having to report their bank deposits within the country to revenue authorities, according to a Task Force on Financial Integrity and Economic Development blog posting by Ann Hollingshead. In her view, such a law would encourage people to hide dirty money in US bank accounts. She sums up: “[Gregory] Meeks and [Bill] Posey, two officials elected to represent the interests of U.S. citizens, have introduced a bill that represents the interests of foreign money launderers, tax evaders, terrorist financers, and, perhaps, big banks.” Writing on the same blog, Global Financial Integrity’s Ryan Isakow writes about a PR/framing coup for the global anti-corruption movement: “It’s interesting to note that connecting corruption to something which directly interests those in power—economic growth— has elicited a bigger response from government leaders than the abundance of stories written everyday on the impoverishing effects corruption has on their own countrymen.  After all, if exploiting the poor bothered them, they would have more reservations about robbing their country’s resources in the first place.”

The US Navy has held a celebration to mark the launch of the 2,000th Tomahawk missile. “It was a great feeling to have taken part in the 2,000th missile launch,” according to a sailor quoted in a Navy press release. “There were a lot of us that had never shot before, so to be able to fire off the 2,000th one was a great experience; it means a lot to us.” The US Navy has launched over 200 Tomahawks in the Libyan conflict so far at a cost of $607,000 each, according to Defense Tech.

In other technology matters, Tactical Technology Collective’s Tanya Notley says mobile phones and the Internet are among the tools that can help people impose a certain level of accountability on governments and development agencies but “there are many “invisible” layers that track what we do online.” And given that such bodies do not always like questioning and exposure, there are real (and sometimes fatal) risks attached to engaging in such behaviour. Consequently, “we should all be thinking about what kind of digital future we want and what risks we might be taking or asking others to take when we promote digital technologies as tools for transparent, fair and just development.”

Former US assistant defense secretary Joseph Nye regrets that Bush Administration “policy failures” led to the view among many that democracy promotion smacked of imperialism and hypocrisy: “Democracy is not an American imposition, and it can take many forms,” he writes. But he stresses the need to “stimulate emulation” by maximizing domestic democracy, rather than trying to impose values on others. But Foreign Policy’s Josh Rogin sees little in the way of positive examples as he presents “the top eight foreign-policy items currently held up by the do-nothing 112th Congress.” Der Spiegel columnist Jakob Augstein is harsher still in writing of America’s “apparent political insanity” and arguing the “divided country has more in common with a failed state than a democracy.”