Tag Archives: International Finance Corporation

Latest Developments, January 3

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In the latest news and analysis…

Condoning secrecy
Reuters reports that an American judge has ruled the US government does not have to justify its targeted killings:

“[U.S. District Judge Colleen] McMahon appeared reluctant to rule as she did, noting in her decision that disclosure could help the public understand the ‘vast and seemingly ever-growing exercise in which we have been engaged for well over a decade, at great cost in lives, treasure, and (at least in the minds of some) personal liberty.’
Nonetheless, she said the government was not obligated to turn over materials the Times had sought under the federal Freedom of Information Act (FOIA), even though it had such materials in its possession.
‘The Alice-in-Wonderland nature of this pronouncement is not lost on me,’ McMahon said in her 68-page decision.”

Drone stats
The News reports that Pakistani government statistics indicate US drone strikes have killed four times more children than “high value CIA targets” since 2004:

“According to facts and figures compiled by the Ministry of Interior, of the 2,670 people killed by the US drones, 487 were innocent civilians including 171 children and 43 women. Of the remaining 2,183 people killed by the drones, hardly 42 were high value CIA targets while the rest of 2,141 people were believed to be low and mid-level al-Qaeda and Taliban-linked operatives.”

Five-star development
A Pro Publica investigation concludes that the World Bank’s International Finance Corporation, ostensibly set up to help reduce global poverty through promotion of private investment in poor countries, “likes to work with huge corporations, funding projects these companies could finance themselves”:

“Today, the IFC’s booming list of business partners reads like a who’s who of giant multinational corporations: Dow Chemical, DuPont, Mitsubishi, Vodafone, and many more. It has funded fast-food chains like Domino’s Pizza in South Africa and Kentucky Fried Chicken in Jamaica. It invests in upscale shopping malls in Egypt, Ghana, the former Soviet republics, Eastern Europe, and Central Asia. It backs candy-shop chains in Argentina and Bangladesh; breweries with global beer behemoths like SABMiller and with other breweries in the Czech Republic, Laos, Romania, Russia, and Tanzania; and soft-drink distribution for the likes of Coca-Cola, PepsiCo, and their competitors in Cambodia, Ethiopia, Mali, Russia, South Sudan, Uzbekistan, and more.
The criticism of most such investments—from a broad array of academics and watchdog groups as well as local organizations in the poor countries themselves—is that they make little impact on poverty and could just as easily be undertaken without IFC subsidies. In some cases, critics contend, the projects hold back development and exacerbate poverty, not to mention subjecting affected countries to pollution and other ills.”

Bounty hunters
The BBC reports on the spam-like and mistake-prone methods of a private company hired by the British government to track down people thought to be in the UK illegally:

“Migrants are contacted by text message, telephone or email.
The standard text message reads: ‘Message from the UK Border Agency. You are required to leave the UK as you no longer have the right to remain.’ It then advises people to contact the agency.
…
Capita was hired to trace those in the pool and warn them that they are required to leave the country. The firm will be paid depending on how many actually go back to their home country.”

Let them eat cake
Bloomberg reports that “the richest people on the planet” became even wealthier in 2012:

“The aggregate net worth of the world’s top moguls stood at $1.9 trillion at the market close on Dec. 31, according to the index. Retail and telecommunications fortunes surged about 20 percent on average during the year. Of the 100 people who appeared on the final ranking of 2012, only 16 registered a net loss for the 12-month period.
‘Last year was a great one for the world’s billionaires,’ said John Catsimatidis, the billionaire owner of Red Apple Group Inc., in an e-mail written poolside on his BlackBerry in the Bahamas.”

Extermination risk
The Guardian reports that Peru’s “biggest indigenous federation” intends to look to the country’s courts to stop the expansion of natural gas extraction in a remote area of the Amazon by a consortium that includes US, Korean and Spanish companies:

“[The Interethnic Association for the Development of the Peruvian Rainforest (Aidesep)] said the plans by Peru’s energy and mines ministry to increase exploration and drilling in Block 88, the largest gasfield leased by the Camisea consortium, risk the existence of nomadic groups living in ‘voluntary isolation’ in the Nahua-Kupakagori indigenous reserve, 23% of which overlaps the gas block in the country’s south-eastern jungle.
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The risks of ‘unwanted’ contact are well-documented. Around 60% of the isolated Nahua people died during a series of epidemics after their first contact with outsiders soon after oil company Shell discovered the gasfields in 1984.”

Banned exports
The Globe and Mail reports that the Canadian government has offered its arms merchants “new market opportunities” by allowing them to export to Colombia assault weapons banned in Canada:

“Now, Colombia has been added to a list that includes Canada’s 27 NATO allies – along with Australia, Finland, New Zealand, Saudi Arabia, Sweden and Botswana – where prohibited firearms manufactured in this country may be sold.
The government notice says the amendment is ‘consistent with the aim of the [Automatic Firearms Country Control List] to promote transparency in the export and transfer of prohibited firearms, prohibited weapons and prohibited devices by making public that Canada will now consider export permit applications for the export of those items to Colombia.’ ”

Humanitarian cover
Senegal/Mali-based journalist Peter Tinti writes that debates in Washington over the US approach to counterterrorism in Africa have more to do with “keeping policy frameworks apace with practice” than actually shaping that practice:

“Under the Obama administration, U.S. military operations in Africa have rapidly expanded in scope, depth and breadth, creating a skeletal infrastructure that enables a panoply of near-constant training exercises with partner governments — as well as clandestine activities.
Though Camp Lemmonier in Djibouti is technically the only permanent U.S. military base in Africa, in reality, there are hundreds of military outposts and locations dotting the continent, with several thousand uniformed U.S. military and civilian Department of Defense personnel, as well as an unknown number of defense contractors, working across the continent at any one time. U.S. special operations forces regularly work within civil-affairs and humanitarian assignments that provide cover for covert counterterrorism activities.”

Latest Developments, October 4

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Land grab complicity
A new Oxfam report criticizes the World Bank for contributing to the growing problem of land grabs in poor countries:

“The World Bank is in a unique position as both an investor in land and an adviser to developing countries. The Bank’s investments in agriculture have increased by 200 per cent in the last 10 years, while its private sector arm, the International Finance Corporation, sets standards followed by many investors. The Bank’s own research reveals that countries with the most large scale land deals are those with the poorest protection of people’s land rights. And since 2008, 21 formal complaints have been brought by communities affected by Bank projects that they say have violated their land rights.”

Defence corruption
A new Transparency International report gives 37% of the world’s biggest defence companies an “F” and only 1% an “A” on its anti-corruption test:

“The study, which grades companies from A to F, measures defence companies worth more than USD 10 trillion, with a combined defence revenue of over USD 500 billion. Transparency International estimates the global cost of corruption in the defence sector to be a minimum of USD 20 billion per year, based on data from the World Bank and the Stockholm International Peace Research Institute (SIPRI). This equates to the total sum pledged by the G8 in L’Aquila in 2009 to fight world hunger.”

Optional accountability
iPolitics reports that an office established by the Canadian government to mediate disputes between the country’s extractive industry and communities overseas has once again had to drop a case due to a mining company’s refusal to play along:

“The Office of the Extractive Sector Corporate Social Responsibility Counsellor, created in 2009 following widespread allegations of human rights abuses and environmental degradation by the industry around the world, received a complaint from two Argentine environmental groups in July over the impacts of McEwen Mining’s Los Azules copper exploration site on glaciers in the Andes.
But the office, which has dropped two previous cases brought on by civil society groups in Mexico and Mauritania and can only work with companies who agree to co-operate, has been informed by McEwen that the company won’t be participating in the mediation process, said Nils Engelstad, vice-president for corporate affairs.”

Herbicide boom
Mother Jones reports that contrary to biotech company claims, genetically modified crops actually seem to require larger amounts of herbicides than non-GMO strains:

“For several years, the Roundup Ready trait actually did meet Monsanto’s promise of decreasing overall herbicide use—herbicide use dropped by about 2 percent between 1996 and 1999, [Washington State University’s Chuck] Benbrook told me in an interview. But then weeds started to develop resistance to Roundup, pushing farmers to apply higher per-acre rates. In 2002, farmers using Roundup Ready soybeans jacked up their Roundup application rates by 21 percent, triggering a 19 million pound overall increase in Roundup use.
Since then, an herbicide gusher has been uncorked. By 2011, farms using Roundup Ready seeds were using 24 percent more herbicide than non-GMO farms planting the same crops, Benbrook told me. What happened? By that time, ‘in all three crops [corn, soy, and cotton], resistant weeds had fully kicked in,’ Benbrook said, and farmers were responding both by ramping up use of Roundup and resorting to older, more toxic herbicides like 2,4-D.”

Questionable investments
The Bretton Woods Project writes that the International Finance Corporation, the World Bank’s private sector arm, is coming under fire for funding mines at the centre of controversies in South Africa, Peru and elsewhere:

“Indiana University-based researcher Alex Lichtenstein commented: ‘In retrospect, it is hard to avoid the suspicion that Lonmin secured a major infusion of capital from the IFC five years ago by pimping its vastly overstated claim to corporate social responsibility. Indeed, the poverty of North West Province, historically abetted by a system of apartheid designed to insure cheap mine labor, by 2007 represented another investment opportunity for the nimble forces of global capital that had impoverished the region in the first place.’
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Alhassan Atta-Quayson of Ghana-based NGO Third World Network Africa, said: ‘The African mines supported by the IFC, from Guinea to South Africa, show the IFC’s complicity in the sub-optimal exploitation of Africa’s natural resources and the escalation of conflicts. The least we expect from the IFC is a return to the recommendations of the Extractive Industries Review and the divestment from these projects.’ ”

Investors for rights
A group of investors collectively worth over half a trillion dollars has issued a statement supporting “international legal frameworks, including the U.S. Alien Tort Statute (ATS), to protect human rights”:

The ATS is an important tool in encouraging standardized expectations for corporate behavior related to human rights. As Nobel Prize winning economist Joseph Stiglitz puts it, ‘ATS liability might be bad for bad businesses, but it is good for good businesses.’ For good companies, the ATS not only reduces the ability of competitors to gain advantage by ignoring human rights – it also gives them a mechanism to stand up to oppressive governments. They can point to the ATS as the reason why they are unable to participate in projects suspected to hold human rights liabilities.

Kiobel concerns
The International Corporate Accountability Roundtable’s Amol Mehra and Katie Shay write that a US Supreme Court case pitting Nigerian plaintiffs against oil giant Shell highlights the “alarming disconnect between corporate social responsibility practices and actual corporate behavior”:

“If Shell’s arguments win, the Supreme Court will effectively cut off what is often the best available remedy for victims of corporate-related human rights abuses. Outside of the allegations in the case, what the posturing by Shell highlights is the alarming disconnect between corporate social responsibility practices and actual corporate behavior, including the choice of litigation strategy and legal positions. How can a company that purportedly has a commitment to CSR seek to gut a law that brings human rights victims a remedy for harm?
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For CSR to truly mean anything, it must include clear commitments to respect human rights. The choice of litigation strategy and legal positions feeds directly into this responsibility, especially when a company is seeking to do more than defend itself from allegations of wrongdoing.”

Latest Developments, June 13

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Last words
Elinor Ostrom, the only woman to win the Nobel Prize in economics, has died but not before warning against attempts to forge “a single international agreement” at this month’s Rio+20 conference:

“We have never had to deal with problems of the scale facing today’s globally interconnected society. No one knows for sure what will work, so it is important to build a system that can evolve and adapt rapidly.
…
The goal now must be to build sustainability into the DNA of our globally interconnected society. Time is the natural resource in shortest supply, which is why the Rio summit must galvanize the world. What we need are universal sustainable development goals on issues such as energy, food security, sanitation, urban planning, and poverty eradication, while reducing inequality within the planet’s limits.”

Measuring peace
The Institute for Economics and Peace has released its latest Global Peace Index, which concludes that the world has become “slightly more peaceful” as countries focus more on projecting economic rather than military power:

“Improvements in the Political Terror Scale and gains in several indicators of militarization arising from austerity-driven defence cuts were the two leading factors making the world more peaceful in 2012, according to the latest Global Peace Index (GPI) released today. This reverses two consecutive years where the GPI has shown a decline in global peace. If the world had been completely peaceful, the economic benefit to the global economy would have been an estimated US$9 trillion in the past year (equal to the size of the German and Japanese economies combined.)”

GPI critique
Dart-Throwing Chimp’s Jay Ulfelder says he wants to like the Global Peace Index but fears it “obscures as much as it clarifies”:

“The index includes so many things, we are told, because it aims to get simultaneously at two distinct ideas: not just ‘negative peace,’ meaning the absence of violence, but also ‘positive peace,’ meaning the presence of structures and institutions that create and sustain the absence of violence.
…
International relations scholars would tell you that countries can sometimes avoid wars by preparing for them; rival states are less likely to pick fights with armies they can’t easily beat. Most people would probably think of the avoidance of war as a peaceful outcome, but the GPI casts the preparations that sometimes help to produce that outcome as a diminution of peace. In an ideal world, disarmament and peace would always go together; in the real world, they don’t, but the index’s attempt to combine measures of negative and positive peace muddles that complexity.”

World Bank complaint
Mining Watch Canada reports that civil society organizations have filed a complaint concerning World Bank financing of a Canadian-owned mining project in Colombia:

“The complaint cites, among ten main concerns, the [International Finance Corporation]’s failure to evaluate the potentially severe and irreversible social and environmental impacts of the project, a large-scale gold mine located in a fragile, high-altitude wetland, called the Santurbán páramo, which provides water to over 2.2 million Colombians.
The Committee for the Defence of Water and the Santurbán Páramo, a coalition of nearly 40 groups living downstream of the project in Bucaramanga, asserts that the IFC, the World Bank’s private-sector lending arm, ignored its own policies before investing US$11.79 million in Greystar Resources – now Eco Oro Minerals Corp. – in 2009. The IFC bought shares before the company had completed required environmental and social impact assessments.”

Letter to Walmart
Two senior Democratic members of the US House of Representatives have sent a letter to Walmart CEO Mike Duke, accusing the company of hampering an investigation into allegations it paid millions in bribes to Mexican officials:

“Although you stated during a recent shareholders meeting that Wal-Mart is ‘doing everything we can to get to the bottom of the matter,’ you have not provided us with the information we requested. Specifically, you have provided us with no documents, you have declined to allow any Wal-Mart employees to brief our staffs about the allegations, and you have failed to respond to our request to speak with Maritza Munich, a key figure in the investigation. Wal-Mart’s actions to date significantly inhibit our ability to investigate these allegations.”

Ethnic cleansing
The Jewish Week’s Eric Herschthal condemns the “conservative ethnic tribalism” behind Israel’s planned mass deportation of African migrants:

“The worry of guys like [Israeli interior minister Eli] Yishai is that the Africans will dilute Israel’s Jewish character. I find that idea deeply offensive, even though I fully understand the broader issue of wanting Israel to retain a strong Jewish majority (though I take issue with it still).  But what this whole African issue really underscores is just how problematic Israel’s strict ethnic definition of a ‘Jewish state’ is: to remain in control of their own affairs, Israel will have to effectively get in the business of ethnic cleansing.  One hopes this ethnic cleansing never turns into the bloody affair it has in so many other countries—but all we can do is hope.”

Chain reaction
Jeune Afrique reports on how mining and agribusiness companies are changing the geography of southern DR Congo:

“In the highly urbanized mining belt of southern Katanga, where the demand for agricultural products is high, access to land is becoming difficult for small-scale farmers. With urban sprawl, increasing mining activity and the arrival of agribusiness companies – such as Terra, which owns 10,000 hectares –, available space is shrinking and land prices have skyrocketed. Even if the granting of concessions to mining companies includes compensation, it represents a source of insecurity for local farmers, who have been forced to give up their lands and go elsewhere. The granting of new mining concessions and vast areas to agropastoral companies could further fuel the trend, with the risk of accelerating the rural exodus or transforming smallholder farmers into day labourers.” (Translated from the French.)

Underdeveloping Africa
Hamilton College’s Nigel Westmaas marks the 40th anniversary of Walter Rodney’s How Europe Underdeveloped Africa and concludes much of the analysis continues to hold true:

“The overt fangs that slave traders and corporate giants like Barclays, Unilever and Firestone openly displayed in early profiteering and exploitation of the continent have been replaced by charming corporate public relations smiles and handouts. Yet the profits sequestered from Africa over several centuries, as effectively argued by Rodney, still stand as a foremost if not exclusive source and substance of Africa’s underdevelopment.”