Latest Developments, July 20

In the latest news and analysis…

As expected, the UN has officially declared a famine in southern Somalia. French agriculture minister Bruno Le Maire writes in Le Monde that hunger in this day and age is a “scandal,” and a Globe and Mail editorial decries the slow international response to the food crisis in the Horn of Africa: “When an alarm of impending famine is sounded, the whole world should be galvanized into action.” But even though USAID’s Famine Early Warning Systems Network predicted the food crisis nearly a year ago and Islamist insurgents controlling much of Somalia recently lifted their ban on foreign aid, there are still legal obstacles to large-scale US assistance.

Earlier this year, the World Food Programme also launched an emergency operation in North Korea and an EU mission recently reported “widespread consumption of grass.” As of last week, the UN had received less than a quarter of the funds it was seeking for North Korean food assistance. The Brookings Institution’s Roberta Cohen says politics have prevented South Korea and the US from helping so far. “But taking no decision is really a decision, which gives the impression that there may be no urgent or extensive food crisis in North Korea requiring immediate action.”

But Columbia University economist Jeffrey Sachs says responding to food shortages, such as the one currently unfolding in the Horn of Africa, is not the way to go. The focus should instead be on lifting people out of poverty permanently, dealing with climate change and reining in population growth.

A Guardian editorial says the British public’s lack of enthusiasm for the government’s pledge to increase aid to 0.7 percent of GDP is understandable, given the frustratingly predictable cycle of development policies. “Fashions in giving have come and gone, interspersed with bursts of retrospective analysis purporting to show both why previous programmes have failed and how to reshape them so that they really will work and really will add to the sum of peace and prosperity in the world.” Nevertheless, the authors encourage the Cameron government to stick to its aid promise before concluding: “If we get it right this time, the public might eventually come round.”

A major problem with foreign aid, according to Bottom Up Thinking, is an accountability deficit resulting from the fact that its “‘customers’ are not the same people as those who pay the bills and that leads to massively misaligned incentives.” But the main reason why people have such little faith in aid’s usefulness is, paradoxically, the high expectations set up by an industry obsessed with sending out positive messages: “The problem, as I see it, is that we are very rarely upfront about the risks of failure. Far too much of the conservation and development industry is extremely reluctant to admit to failure (or even just disappointing results); glossy brochures proclaim an unending procession of success stories.”

The Center for Global Development’s Wren Elhai warns that a six-word amendment to proposed US legislation would make all American assistance to Pakistan conditional on the South Asian country’s demonstration that it is committed to preventing the Taliban and other perceived undesirables from operating within its borders: “The notion that a relatively small amount of civilian aid will change the strategic calculus of the Pakistani military is simply ludicrous. Meanwhile, attempting to use civilian aid as security leverage would upset the fragile two-track strategy that has guided U.S. strategy in Pakistan for the past several years.”

In a blog post entitled “Yes, South Sudan Can,” World Bank economist Shantayanan Devarajan lays out the three keys for South Sudanese success: stimulating sustained economic growth, implementing “home-grown solutions,” and embracing information and communications technology. Drawing on Africa’s recent history for inspiration, Devarajan points to “a number of countries, such as Mozambique and Uganda, which emerged from civil conflict and sustained above-7-percent GDP growth for over a decade.” In the UN’s latest Human Development Index ranking, Mozambique sat 168th out of 172 countries and Uganda scored better than only two non-African countries: Afghanistan and Haiti.

After discussing a recent study that suggests resource extraction is more often a blessing than a curse, Michael Levi of the Council on Foreign Relations turns to the specific possibility of a Liberian oil industry, reminding us the authors’ “analysis is statistical: while it might say that on average there isn’t a resource curse, that should be little reassurance for any particular country that’s diving into extraction.” Nor does the analysis, which focuses on political freedom, take socio-economic or environmental indicators into account. Of the 12 sub-Saharan countries whose daily crude production currently exceeds 50,000 barrels per day, only Gabon, South Africa and Congo do not rank in the bottom quintile in either the UN’s Human Development Index or Yale University’s Environmental Performance Index.

Reuters correspondent Peter Apps asks if Britain is more corrupt than it thinks. According to one expert quoted in the article: “If you look at the way we talk about and measure corruption in the West, it’s either Africa or Asia which comes out worse. But we are using a distorted prism.” Apps’s question is inspired by the UK’s ongoing phone hacking scandal, but there are also new developments concerning British companies behaving badly overseas. A parliamentary committee slammed military contractor BAE Systems for misusing funds in Tanzania and not paying the penalty imposed after a plea bargain. And miner Monterrico Metals has settled out of court on charges of collusion in the detention and torture of protesters in Peru.

The European Network on Debt and Development’s Alex Marriage sees an “apparent conflict of interest” in the fact that the European Commission assigned PricewaterhouseCoopers, an international accounting firm which boasts 415 of the Fortune Global 500 among its clients, to prepare a report on how poor countries can minimize financial losses due to corporate transfer pricing.  The practice allows large multinational corporations to reduce their tax bill by creatively billing themselves for transactions between subsidiaries so as to maximize declared expenses and minimize declared profits. “Transfer pricing is the single biggest source of illicit financial flows in the world costing developing countries hundreds of billions of dollars every year,” according to Marriage. PwC claims its own 2011 report on global transfer pricing – a separate document from the EU-commissioned one – “offers practical advice on a subject where the right amount of effort can produce huge dividends in the form of a low and stable tax charge, coupled with the ability to defend a company against tax auditor attack.”

Oxfam’s Duncan Green asks why development experts pay so little attention to “how poor people ‘do’ development.” And the Center on International Cooperation’s Alex Evans points out that poor people will not get a fair share of the world’s limited resources unless “developed countries and the “global middle class” dramatically reduce their consumption levels.”


Latest Developments, July 19

In the latest news and analysis…

With the food crisis in the Horn of Africa intensifying and the United Nations expected to declare the food shortage in southern Somalia a famine as early as tomorrow, Kenya has agreed to accept imports of genetically modified maize. The decision, which came in the face of anti-GMO protests, was a first for the country. The government insists the maize will be turned into flour at the point of importation so as to prevent the seeds from getting into the market, but it is unclear at this point what additional measures, if any, it will take to ensure containment.

The Center for Global Development’s David Wheeler examines investment in renewable energy sources by 174 countries over the last two decades. His findings “contradict the conventional view of North-South conflict that has dominated global climate negotiations, because they show that developing countries, whether by intention or not, have been critical participants in reducing the carbon load all along.  Furthermore, they indicate that poor countries have borne their fair portion of global carbon alleviation expenditures, measured as shares of income per capita.”

Wheeler’s colleague Charles Kenny defends his own suggestion that $100 billion in annual cash transfers would suffice to bring about “a world free of poverty,” by which he means that amount could raise everyone living in a poor country to the World Bank’s $1.25 a day poverty line, which the institution admits is a “frugal” figure.

Nick Dearden, director of the Jubilee Debt Campaign argues Western-style free trade – currently being pushed as the key to African prosperity by British prime minister David Cameron and the business delegation accompanying him on his trip to Africa – is the last thing the continent needs. Instead, he argues, African governments should look to “protecting industries, developing alternative and complementary means of trading, control of food production and banking, progressive tax structures, controlled use of savings, and strong regulation to ensure trade and investment really benefits people.”

While speaking in Nigeria, Cameron also called for the EU to adopt “legally binding measures to require oil, gas and mining companies to publish key financial information for each country and project they work on.” He explained: “We want to disclose the payments our companies make to your governments so you can hold your governments to account for the money they receive.” According to estimates by Global Financial Integrity, Nigeria lost $130 billion dollars between 2000 and 2008 due to illicit outbound financial flows, much of it in the energy sector. And real growth of such flows during that nine-year period was 21.9 percent in Africa. Christian Aid welcomed the prime minister’s words, pointing out that poor countries lose 50 percent more to transnational corporate tax avoidance each year than rich countries provide through aid. “But EU legislation needs to go further,” the group said. “In order to ensure companies are paying the right amount of tax, we need more information on how the taxes they do pay relate to the profits they make.” Christian Aid also wants to see a political push for greater transparency in all industries, not just the extractive ones.

JKL Energy, a Ghanaian company has announced it plans to start work on a $300 million oil and gas project. The venture, which has support from investors in Malaysia and Dubai, will contribute to “ensuring that indigenous companies actively participate in the development of Ghana’s oil and gas industry, seen by many as a major driver of the economy over the next 30 years,” according to a press release.

And Liberia could be the next African country to deal with the double-edged sword of oil production as Chevron is set to start offshore exploration later this year. The US expects a quarter of its oil imports to come from West Africa by 2015 and Liberian President Ellen Johnson-Sirleaf has said she hopes her country can avoid the “oil curse.”

A day after a call for a new Marshall Plan in South Sudan, a week after an argument for a Greek Marshall Plan and 18 months after a plea for a Haitian Marshall Plan, a Modernizing Foreign Assistance Network blog post asks if it is time for a “21st Century Marshall Plan” in the Arab world.

Al Jazeera’s Sebastian Walker investigates the debates and motives behind American military involvement in Libya, which he describes as “a victory for the so-called humanitarian interventionists,” such as secretary of state Hillary Clinton, ambassador to the UN Susan Rice and National Security Council advisor Samantha Power.

An online fundraising plan is set to kick off this week to cover the costs of enacting Arizona state legislation calling for prisoners to build 130 km of fence along the US-Mexico border to keep out would-be illegal migrants. The MSNBC article portrays opposition to the planned construction as being largely practical and logistical – one county sheriff considers it “well intentioned” though ultimately futile – but it also mentions one group taking a moral stand. While Defenders of Wildlife “are in support of effective border security,” they believe in freedom of cross-border movement for imperilled species, such as the Chiricahua leopard frog and the Sonoran pronghorn.

Latest Developments, July 15

In today’s news and analysis…

The pre-negotiations for the proposed international Arms Trade Treaty have come to an end. In theory, the real negotiations will take place next year, culminating in a legally binding global compact. The Control Arms Coaltion says it is pleased with how the week went, particularly a joint statement of support for the process by the five permanent members of the UN Security Council, who together account for 88% of the global arms trade. But while there appears to be broad support for some kind of treaty, there is much disagreement on details, reportedly prompting Russia to say consensus is “very, very unlikely.”

After the latest Mumbai bombings, Ramesh Thakur, one of the formulators of the Responsibility to Protect doctrine, says India, a country where over half the population lives on less than $2 a day, “must invest all means necessary” to acquire the capabilities to take “the fight to neighbouring territory from where terror attacks originate through strikes and targeted killings of terrorists.” He concedes that such a policy would risk destabilizing India’s already fragile, nuclear-armed rival but concludes that “is no longer an unacceptable risk.” A quick reminder: The three bombs detonated in Mumbai this week killed 18 people, while the two atomic bombs dropped on Japan in August, 1945 killed an estimated 150,000-250,000 people.

A Reuters piece looks at the rise of the drone as America tries to extricate itself from its wars and avoid getting embroiled in new ones, while targeting perceived threats in an ever growing list countries. The EU, meanwhile, is looking to come up with a drone strategy within the next 12 months.

Canadian immigration authorities have denied internationally acclaimed Tinariwen visas to play this weekend’s Vancouver Folk Festival. A festival organizer, pointing out that the Malian band were in Vancouver during the 2010 Winter Olympics and are touring in the US right now, said the decision made no sense. Could it be the Canadian government, which is trying to toughen up its immigration laws, mistook a group originally formed in Libyan refugee camps three decades ago as current refugee claimants? An internal government report indicates a third of all such cases are refused because an officer does not believe the refugee’s story.

Writing about oil and corruption, Global Witness’s Brendan O’Donnell puts much of the blame on the likes of Muammar Gadhafi and other autocratic rulers, but not all of it. “Essentially, because oil companies do not currently have to disclose what they pay to foreign governments for resource deals, and banks do not have to report on their financial dealings with sovereign funds, it’s very hard for citizens to know how their leaders are using their countries’ natural resource wealth.”

According to Transparency International, the phone hacking scandal “shows that even in a well-functioning democracy where corruption levels are perceived to be low, weaknesses in institutions considered pillars of integrity can lead to breaches of trust if there is insufficient vigilance.”

In a Guardian piece about the post-2015 development agenda, the author reports Allister McGregor as telling the British Parliament the MDGs are outdated and a more nuanced view of the world is necessary: “It’s basically about inequality, how we live well together and how we share wealth.” The trick, according to Jack McConnell who was quoted in the same piece, will be to keep the new goals tangible and verifiable: “If you want to pin governments down, you need precise targets.”

A piece in the Globe and Mail points out “the microfinance revolution that rippled around the world focused squarely on the lending side of the ledger – largely overlooking microsaving.” As a result, poor people had nowhere secure to store their small savings. But that is now changing.

A new Institute of Development Studies bulletin on seed politics and the push for an African Green Revolution asks “who wins, who loses, and whose interests are being served?”