Tag Archives: World Bank

Latest Developments, November 17

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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 21

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World Bank and human rights
The Guardian’s John Vidal reports on fears that the World Bank’s proposed Programme-for-Results lending could be disastrous for human rights and the environment in poor countries.
“According to the proposals, the new instrument would eliminate or greatly dilute 25 existing safeguards and policies. They include those that apply to forced resettlement, natural habitats, physical and cultural resources, indigenous peoples, forests, safety of dams, natural habitats, and environmental action plans. Most of these policies have taken years of pressure by NGOs to secure.
The bank, which lends more than $50bn a year, is one of the world’s largest providers of loans for mega-projects, many of which are particularly damaging to local people, the environment and the climate. If countries wanting to build giant dams, roads, power and water projects are to be largely freed from acting in a socially responsible way, the NGOs fear bank lending could lead to more forced evictions and human rights abuses.”

Deregulation fever
The Tax Justice Network slams the World Bank’s new Doing Business report for assuming that deregulating the business environment is inherently good and accuses it of being unduly influenced by corporate lobbyists.
“This has meant that countries that don’t provide effective worker protection are deemed ‘business-friendly’, while those that try to protect their environment are deemed ‘unfriendly’.
Among the indicators used in the guide is a Paying Taxes Indicator (PTI), and – you guessed it – countries are ranked according to their corporate tax rates. In Bankspeak taxing business is ‘unfriendly’.”

Beyond GDP
The Broker magazine’s Steffie Verstappen summarizes an online discussion in which the contributors agreed that growth and per capita GDP are inadequate indicators of human wellbeing.
“What we need, suggests [executive director of WOTRO Science for Development in The Hague, Henk] Molenaar, is ‘a single, powerful concept to rival growth’ as the driving force behind development. Needless to say, this is not an easy task. Nonetheless, the concept is likely to be found in the social nature of human beings and not in the logic of accumulation and competition. If we want to make a difference, we should start looking at and measuring development as a social phenomenon that is ‘nested in relations rather than individuals’, Molenaar contends.”

Food trade
The International Food Policy Research Institute’s Sara Gustafson welcomes new limits on commodity trading in the US as “a step toward reducing food price volatility and thus food insecurity.”
“Specifically, the new rules limit the number of commodity contracts that any investor can hold in agriculture, energy, or metals contracts. The trade limits, originally mandated in the Dodd-Frank Financial Reform Act which was passed in July 2010, stemmed from worldwide concerns that commodity index and other funds contributed to the 2008 surge in food and fuel prices, and could again be contributing to recent price spikes. The new rules are intended to prevent commodities markets from becoming too concentrated, which can lead to speculation and market manipulation. Under the new limits, a single trader would be allowed to hold spot month positions equal to 25% of the estimated physical deliverable supply of a given commodity.”

Libyan bonanza
The Press Association reports UK Defence Secretary Philip Hammond is pushing British companies to compete for Libyan reconstruction contracts amid expectations the former rebels will be looking to reward the countries that helped them come to power.
“With the military campaign all but over after the death of Muammar Gaddafi and the defeat of what appears to have been the last pockets of resistance, Mr Hammond said sales directors should be ‘packing their suitcases’ for Libya.”

War and peace
The University of Cambridge’s Tarak Barkawi argues it is far too simplistic to think the death of former Libyan leader Moammar Gadhafi’s death will mean the end of that country’s conflict, in part because NATO’s military support meant the erstwhile rebels never had to cooperate  amongst themselves in a way that might have fostered lasting cohesion.
“Diplomats and the UN make tidy distinctions between ‘conflict’ and ‘post-conflict’, upon which their policies are based.
Yet fighting, out in the open or in the shadows, has often preceded and post-dated the official period of hostilities. More fundamentally, there is a continuum between peace and war.”

Out of Iraq
The Associated Press reports US President Barack Obama has announced all American troops will withdraw from Iraq by the end of the year, though several thousand private security contractors will remain.
“Denis McDonough, the White House’s deputy national security adviser, said that in addition to the standard Marine security detail, the U.S. will also have 4,000 to 5,000 contractors to provide security for U.S. diplomats, including at the U.S. embassy in Baghdad and U.S. consulates in Basra and Erbil.
In recent months, Washington had been discussing with Iraqi leaders the possibility of several thousand American troops remaining to continue training Iraqi security forces.
Throughout the discussions, Iraqi leaders refused to give U.S. troops immunity from prosecution in Iraqi courts, and the Americans refused to stay without that guarantee.”

W abroad
The Canadian Centre for International Justice’s Matt Eisenbrandt and the Center for Constitutional Rights’ Katherine Gallagher explain why they believe the Canadian government should have arrested former US president George W. Bush during yesterday’s visit to a Vancouver suburb.
“Canada has ratified the Convention Against Torture and incorporated it into its domestic legislation. Under the global treaty, Canada has the obligation to prosecute a torture suspect present in Canada unless another country seeks the suspect’s extradition to stand trial elsewhere. This is not a matter of discretion. When Mr. Bush is present in Canada, he must be extradited or prosecuted.”

Latest Developments, August 22

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The unexpected appearance of a smiling, victory sign-flashing Saif al-Islam Gadhafi after he had supposedly been arrested by rebel forces suggests there may yet be a few twists in the Libyan conflict that has already lasted six months despite roughly 20,000 NATO aerial missions. Nevertheless, with the apparent crumbling of the Gadhafi regime over the last few days, all those nagging questions about Libya’s rebels and what they would do with power may be about to be answered. Beyond concerns about the ability of such disparate groups to work together without the focus provided by a common enemy, the New America Foundation’s Barak Barfi wonders if they have the competencies required for the work that lies ahead: “Short on skilled experts, a post-Qaddafi Libya risks becoming dependent on foreign assistance, much like the Palestinians, who live largely from international aid rather than from their own economic activity.” But as far as Europe is concerned, the business news coming out of Libya is good for now.

As for assessing the NATO mission, the Financial Times reports: “Few, if any, civilian casualties were incurred on the ground; no alliance aircraft or personnel were lost; and the mission saw no flagrant breaches of the remit it received from the UN, which defined the goal of the operation as the protection of civilians on the ground.” But media watchdog Fairness and Accuracy in Reporting has some questions (as does Amnesty International) about reports of civilian deaths, and US congressman Dennis Kucinich argues “the war against Libya has seen countless violations of United Nations security council resolutions (UNSCRs) by Nato and UN member states.”

The Wall Street Journal reports the US Justice Department is getting creative in trying to go after foreign officials who demand bribes, even though the Foreign Corrupt Practices Act is intended for the pursuit of those involved in the supply side of corruption. But lawyers for the ex-governor of the Tourism Authority of Thailand and her daughter are challenging the money laundering charges against their clients: “No court has allowed the making of a payment that is an essential element of the predicate unlawful activity—such as a bribe in bribery case—constitute ‘promotion’ of that same activity.”

Ghana’s Adom News reports tension is growing between Canadian miner Xtra Gold and inhabitants of a community who say their drinking water has been polluted and their lands expropriated, and are threatening to “deal ruthlessly” with the company. Local MP Kwasi Amoako Atta said the company needed to learn how to conduct business in the area: “Even if you have the required documents to back your operations you need to seek clearance from the town leaders, the mere fact that you have the license does not give you the permission to jump into people’s land and start mining.”

The Center for Economic and Policy Research’s Mark Weisbrot has a grim update on the state of reconstruction and resettlement in Haiti’s capital Port-au-Prince: “Nineteen months after the earthquake, almost 600,000 Haitian people are still living in camps, mostly under tents and tarps. Despite the billions of dollars of aid pledged by governments and donors since the earthquake, there are probably less than 50,000 that have been resettled. And for the 600,000 homeless, the strategy seems to be moving in the direction of evictions – without regard as to where they might end up.”

The Center for Global Development’s Michael Clemens presents an economic argument for opening the world’s borders to free movement of people. According to his calculations, taking such a step could increase global GDP by 20-60 percent or tens of trillions of dollars. University of Toronto political scientist Joseph Carens has long called for open borders but he does so on moral grounds: “Citizenship in Western liberal democracies is the modern equivalent of feudal privilege—an inherited status that greatly enhances one’s life chances. Like feudal birthright privileges, restrictive citizenship is hard to justify when one thinks about it closely.”

UN Under Secretary General Philippe Douste-Blazy argues revenues from the tax on financial transactions (re)proposed by the leaders of France and Germany last week should not just go to helping Europe’s struggling economies: “If the crisis is destroying jobs at home, it is destroying lives in the South.” He believes such a “micro-tax” could raise $100-$200 billion a year and would help “globalize solidarity.”

While the Overseas Development Institute’s Jonathan Glennie notes the World Bank “has had a bad couple of decades,” he also believes the it remains important in its ability to raise the profile of certain issues and mobilize governments to take action. But he says it “needs to become a bank for the world, ditching its history of favouring the interests of a few powerful shareholders.” To illustrate his point he takes the example of the debt cancellation campaign which started in the 1980s but did not convince the bank to cancel debts until 2005, “and then only with neoliberal strings attached.” The decades of delay, according to Glennie, were “because the bank is set up to look after the interests of the creditor countries, rather than the debtors, however hard decent officials seek to change that.” Until that changes, he believes the World Bank will be unable “to fulfil its idealistic mandate.”

The Guardian’s George Monbiot writes on the delusions and ravages of perpetual growth: “To sustain the illusion, we have inflicted more damage since 1950 to the planet’s living systems than we achieved in the preceding 100,000 years. The damage will last for centuries; the benefits might not see out the year.” He points to Tim Jackson’s 2009 Prosperity Without Growth as “the beginning of a plan.”

 

Latest Developments, June 29

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In today’s news…

Two World Bank economists argue the best way to reduce corruption and ensure Africa benefits from the current commodity boom is for governments to transfer portions of the resulting revenues directly to their citizens. Of course, government corruption is not the only obstacle to translating mineral wealth into societal benefits. After a three-year dispute, Canada’s First Quantum Minerals has just agreed to pay $224 million in tax arrears to Zambia. The Reuters piece says: “According to the World Bank, copper is responsible for 70 to 75 percent of export earnings but the mining industry as a whole only contributes about 10 percent of Zambia’s tax revenue.”

In the wake of last week’s guilty plea by  another Canadian company, Niko Resources, for bribing a Bangladeshi official, Transparency International finds itself in the unusual position of praising Canada…sort of. In the same breath, the organization points out that Canadian law defines prosecutable foreign bribery cases excessively narrowly and calls for the revival of proposed improvements that died in 2009 when the minority government ended the parliamentary session prematurely.

As the US and Switzerland struggle to come to an agreement on dealing with tax avoidance, the Tax Justice Network suggests some Swiss media and banks are too cozy to allow a meaningful public discussion on the impacts of tax evasion. Perhaps a quick trip to Vienna is in order.

As things stand, US sanctions on Sudanese oil exports will not apply to South Sudan when it officially declares independence on July 9. Unless South Sudanese oil exports, which account for 98 percent of the government’s budget, pass north through Sudan. Which is the only way the pipelines run.

Le Monde Diplomatique’s Serge Halimi argues the current debt crisis represents a threat to democracy as much as the economy and asks (in French) if there is an alternative to “shock therapy.” Another article in the same publication provides the example of Ecuador’s 2008 constitution which stipulates public debt must not impact national sovereignty, human rights or environmental protection; public debt can only be incurred to improve infrastructure or to invest in projects that will pay for themselves; public debt refinancing is only an option if the new terms are advantageous to Ecuador; and the nationalization of private debt is prohibited.

The World Bank tweets: “The time to act is now. The world’s poor will suffer first and most from #climatechange. http://t.co/hPuEYUF,” while the UK House of Commons environmental audit committee slams the global lending institution’s energy policies, which may actually be making climate change worse.

Andrea Wechsler argues in Global Policy that “global governance arrangements must reach beyond the limited concept of intellectual property to knowledge as such and, thus, address global knowledge governance.” But a number of civil society organizations worry a new set of principles on Internet policymaking raises “cybersecurity and intellectual property rights to a level of importance that is comparable with internationally recognized individual human rights such as freedom of expression.”

Latest Developments, June 27

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The UN Security Council has voted unanimously to send 4,200 Ethiopian peacekeepers to Sudan’s disputed Abyei region. As a neighbouring country that has been involved in military conflicts with two of its other neighbours – Eritrea and Somalia –  in recent years, Ethiopia is an interesting choice. David Shinn, a former US ambassador to Ethiopia, is not worried but he discusses the Ethiopia-Sudan relationship’s past and future challenges.

The UN Food and Agriculture Organization has just chosen a new head and the International Monetary Fund is about to do the same. The weekend’s FAO vote went against wealthy donor countries preferring a Spanish candidate to the Brazilian who won on the strength of wide support from the Global South. Given the divisions within the FAO and how far the Millennium Development Goal to halve world hunger by 2015 has gone off track, José Graziano da Silva’s job is unlikely to be an easy one. “Along with tackling the linked problem of climate change, delivering global food and nutrition security is the challenge of our time,” former UN secretary general Kofi Annan said over the weekend, as the number of chronically hungry climbs above 1 billion. At the same time, the number of obese people is closing in on 2 billion. Not surprisingly perhaps, new data on diabetes trends over the last three decades are all over the map. Among the big winners with an overall decreased incidence: Poland, Myanmar and Zambia. Among the big losers with increases of more than 60 percent: the US, Papua-New Guinea and Spain.

After the FAO disappointment, the North is expected to fare better in the IMF thanks to that organization’s vote-as-you-pay scheme, in which the US alone holds 17 percent of the votes and Europe close to 50. Tomorrow’s anticipated election of French finance minister Christine Lagarde will continue the exclusive ownership of the IMF leadership Europe has enjoyed since the organization’s inception. Despite growing pressure to relinquish this hold, European leaders have argued that the body’s primary focus is currently the eurozone crisis and its leadership should reflect that fact.

(As an aside, the International Criminal Court’s latest weekly update is out. Apart from an item on a visit from the Dutch foreign minister, the entire issue pertains to Africa. It remains to be seen whether European leaders will follow their IMF logic by pushing for an African to become the next chief prosecutor.)

While the IMF waits for official word of its new leader, it may have lost a customer, as Egypt appears to have decided it does not want a loan after all. And a number of Arab NGOs are accusing donors, such as the IMF and World Bank, of undermining the Arab Spring by imposing excessive conditions on loans.

The IMF’s sister institution, the World Bank, wants to include anti-corruption lessons in the curricula of poor countries. There is no word at present of a complementary initiative to teach rich countries how to tackle the supply side of graft.

In the private sector, Wal-Mart is heading to Africa where it is encountering considerable resistance. And the government of Peru has just revoked the license of Canadian mining company Bear Creek, following protests in which police killed at least five demonstrators. The company whose share prices tumbled on Monday vowed to take action against the government under the Canada-Peru bilateral free trade agreement which passed though the Canadian Parliament in 2009, just days after dozens were killed in protests over planned resource exploitation in the Amazon.

Finally, and appropriately for this first edition of Latest Developments, a plea to make fighting global inequality a priority.