Inter Press Service http://www.ipsnews.net News and Views from the Global South Sat, 18 Feb 2017 11:06:50 +0000 en-US hourly 1 http://wordpress.org/?v=4.1.15 Alternative Mining Indaba Makes Its Voice Heardhttp://www.ipsnews.net/2017/02/alternative-mining-indaba-makes-its-voice-heard/?utm_source=rss&utm_medium=rss&utm_campaign=alternative-mining-indaba-makes-its-voice-heard http://www.ipsnews.net/2017/02/alternative-mining-indaba-makes-its-voice-heard/#comments Sat, 18 Feb 2017 04:00:11 +0000 Mark Olalde http://www.ipsnews.net/?p=149007 A delegate from the Alternative Mining Indaba dances during a protest march on Feb. 8, 2017. About 450 representatives of civil society mining-affected communities attended the conference in Cape Town. Credit: Mark Olalde/IPS

A delegate from the Alternative Mining Indaba dances during a protest march on Feb. 8, 2017. About 450 representatives of civil society mining-affected communities attended the conference in Cape Town. Credit: Mark Olalde/IPS

By Mark Olalde
CAPE TOWN, South Africa, Feb 18 2017 (IPS)

“Comrades, we have arrived. This cherry is eight years awaited. We have made it to this place,” Bishop Jo Seoka told the crowd, pausing to allow for the whistles and cheers.

Seoka, the chairman of a South African NGO called the Bench Marks Foundation, presided over the crowd of protesters that was busy verbally releasing years of frustration at the continent’s mining industry. The protest on Feb. 8 was part of the Alternative Mining Indaba (AMI) held in Cape Town.“We want transparency, we want accountability and, most importantly, we want participation of the people affected by mining." --Mandla Hadebe

The annual gathering brings together residents of mining-affected communities and civil society representatives to discuss common problems caused by the mining industry in Africa. On its third and final day, the AMI took to the streets to deliver its declaration of demands to industry and government representatives.

While police temporarily blocked the march from reaching the convention center hosting the Mining Indaba, the industry’s counterpart to the AMI, protesters were angry after years of having their side of the story largely ignored.

They marched up to the line of police and private security guarding the doors to the conference hall and demanded to speak with members of the Mining Indaba.

“As citizens and representations (sic) citizen-organisations we wish to express our willingness to work with African governments and other stakeholders in the quest to harness the continent’s vast extractive resources to underpin Africa’s socio-economic transformation and the [Africa Mining Vision] lays a foundation for this,” the declaration stated.

“I very much appreciate the willingness to engage in dialogue, and I think this is the first step towards establishing a common vision,” Tom Butler, CEO of the International Council on Mining & Metals, told the crowd before signing receipt of the declaration and handing it over for the managing director of the Mining Indaba to also sign.

Alternative Mining Indaba participants dance and sing struggle songs during their march on Feb. 8, 2017. Individual countries have begun holding their own alternative indabas, with South Africa’s first country-specific conference held this year in Johannesburg. Credit: Mark Olalde/IPS

Alternative Mining Indaba participants dance and sing struggle songs during their march on Feb. 8, 2017. Individual countries have begun holding their own alternative indabas, with South Africa’s first country-specific conference held this year in Johannesburg. Credit: Mark Olalde/IPS

While Butler came to the AMI to give a presentation on the mining industry’s behalf, few other members of government or the industry made an attempt to engage with the AMI. The Mining Indaba’s Twitter account even blocked some AMI delegates who took to social media to air their grievances.

The official Mining Indaba is a place for mining ministers, CEOs of mining houses and other industry representatives to network and strike deals. During the event, South Africa and Japan, for example, signed a bilateral agreement to boost collaboration along the mining value chain.

“This Indaba has affirmed South Africa’s status as a preferred investment destination,” Mosebenzi Zwane, the country’s minerals minister, said in a statement following the event. “As government, we are heartened by this and recommit to ensuring the necessary regulatory and policy certainty to attract even more investment into our country.”

In his opening address at the Mining Indaba, Zwane also announced that the draft of the new Mining Charter, a document guiding the country’s mining industry, would be published in March.

The AMI, however, was born as a community-level response to the fact that such decisions are usually made without consulting those most impacted by mining.

“They are going to find this huddled mass of people,” Mandla Hadebe, one of the event organizers, said of the protest’s goals in the first year. Only 40 delegates were present.

An Alternative Mining Indaba delegate from Swaziland sings protest songs. There was a feeling of triumph among the delegates after achieving even a degree of acknowledgement from industry representatives. Credit: Mark Olalde/IPS

An Alternative Mining Indaba delegate from Swaziland sings protest songs. There was a feeling of triumph among the delegates after achieving even a degree of acknowledgement from industry representatives. Credit: Mark Olalde/IPS

In its eighth year, the AMI has grown to about 450 participants representing 43 countries. Delegates came from across Africa – from Egypt to the Democratic Republic of the Congo and Malawi – as well as the rest of the world – from Cambodia to Bolivia and Australia – to share their stories.

“It just shows that our struggles are common and that we’ve decided to unite for a common purpose,” Hadebe said of the growth. “We want transparency, we want accountability and, most importantly, we want participation of the people affected by mining.”

A number of panels dedicated to community voices gave activists a platform to share their stories and methods of resistance. Translators in the various conference rooms translated among English, French and Portuguese, a necessity as well as a tacit nod to the ever-present effects of the same colonialism that brought mining.

“What we heard first were promises,” a woman from Peru recounted. “Thirty years passed, and now I call the second part of this process ‘the lies.’”

“We are trying to build a critical mass that is angry enough to oppose irresponsible mining,” a delegate from Kenya explained.

Some panels addressed specific issues facing Africa’s extractive industry. One discussion explained the need to move away from indirect taxes toward direct ones focused on mining houses. The presenter, a member of Tax Justice Network-Africa, said that an increase in government audits had led to a surge in tax revenue since 2009, a rare success story.

Another panel dealt with the realities of impending job loss due to widespread mechanization, while others took on the need for governments to strike better deals with international corporations.

Side events provided forums for more nuanced learning on topics such as the corruption involved with mining on communal land. At the showing of a documentary following South African land rights activist Mbhekiseni Mavuso, delegates from other countries such as Sierra Leone compared and contrasted their own forced relocations.

Mavuso said, “We are regarded as people who do not count. We have now become what we call ‘victims of development,’ and so that is also making us to become victims of democracy. We are fighting, so let us all stand up and fight.”

Occasionally, delegates took to the microphone to lament continued talk with minimal action. Much of the AMI focused on the Africa Mining Vision, a document produced by the African Union. While its goal is to make mining beneficial for all Africans, the document is a high-level policy discussion lacking a direct connection to affected communities.

The three-day conference has outgrown its ability to delve deeply into every issue impacting the represented countries, so delegates have taken the idea to their home nations. In the past year, Madagascar, Angola, Swaziland and others held their first country-specific alternative indabas.

Only a week before the AMI, South Africa hosted its first such conference in Johannesburg.

Despite many delegates expressing feelings of helplessness or anger, the march to the Mining Indaba provided a temporary sense of victory.

After finally obtaining some level of acknowledgment from industry representatives, the AMI participants danced and took selfies outside the Mining Indaba, far from the townships and rural villages adjacent to mines.

As the delegates boarded busses to depart the event, the vehicles shook from stomping and singing, and some protesters leaned out the windows to shout their last parting sentiments on behalf of mining-affected communities around the country and the continent.

*Mark Olalde’s mining reporting is financially supported by the Pulitzer Center on Crisis Reporting, the Fund for Environmental Journalism and the Fund for Investigative Journalism.

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Expansion of Renewable Energies in Mexico Has Victims, Toohttp://www.ipsnews.net/2017/02/expansion-of-renewable-energies-in-mexico-has-victims/?utm_source=rss&utm_medium=rss&utm_campaign=expansion-of-renewable-energies-in-mexico-has-victims http://www.ipsnews.net/2017/02/expansion-of-renewable-energies-in-mexico-has-victims/#comments Fri, 17 Feb 2017 22:34:19 +0000 Emilio Godoy http://www.ipsnews.net/?p=149013 In Mexico, wind farms spark controversy due to complaints of unfair treatment, land dispossession, lack of free, prior and informed consent and exclusion from the electricity generated. In the photo, wind turbines frame the horizon of the northern city of Zacatecas. Credit: Emilio Godoy/IPS

In Mexico, wind farms spark controversy due to complaints of unfair treatment, land dispossession, lack of free, prior and informed consent and exclusion from the electricity generated. In the photo, wind turbines frame the horizon of the northern city of Zacatecas. Credit: Emilio Godoy/IPS

By Emilio Godoy
KIMBILÁ, Mexico, Feb 17 2017 (IPS)

The growing number of wind and solar power projects in the southern Mexican state of Yucatán are part of a positive change in Mexico’s energy mix. But affected communities do not see it in the same way, due to the fact that they are not informed or consulted, and because of how the phenomenon changes their lives.

“We have no information. We have some doubts, some people say it’s good and some say it’s bad. We have heard what is said in other states,” small farmer Luis Miguel, a Mayan Indian, told IPS.

He lives in Kimbilá, a town in the municipality of Izmal, which is the site of an up-to-now failed private wind power venture that has been blocked by opposition from the area’s 3,600 inhabitants and in particular from the ejido or communal land where the wind farm was to be installed.“There is a lack of information going to the communities, who don’t know the scope of the contracts; (the companies and authorities) don’t explain to them the problems that are going to arise. Conflicts are generated, and manipulation is used to get the permits. Social engineering is used to divide the communities.” -- Romel González

“We fear that they will damage our crops,” said Miguel, whose father is one of the 573 members of the Kimbilá ejido, located in the Yucatán Peninsula, 1,350 km southeast of Mexico City.

The questioned project, run by the Spanish company Elecnor, includes the installation of 50 wind turbines with a capacity of 159 MW per year.

The company installed an anemometric tower in 2014, but the local population, who grow maize and garden vegetables, raise small livestock and produce honey for a living, did not find out about the project until January 2016.

Since then, the ejido has held two assemblies and cancelled another, without reaching an agreement to approve a 25-year lease on the lands needed for the wind farm.

Meanwhile, in February 2016, the members of the ejido filed a complaint against the Procuraduría Agraria – the federal agency in charge of protecting rural land – accusing it of defending the interests of the company by promoting community assemblies that were against the law.

The wind farm is to have an operating life of 30 years, including the preparatory phase, construction and operation, and it needs 77 hectares of the 5,000 in the ejido.

The company offered between five and 970 dollars per hectare, depending on the utility of the land for a wind farm, a proposition that caused unrest among the ejido members. It would also give them 1.3 per cent of the turnover for the power generated. But the electricity would not be used to meet local demand.

“We haven’t been given any information. This is not in the best interests of those who work the land. They are going to destroy the vegetation and 30 years is a long time,” beekeeper Victoriano Canmex told IPS.
This indigenous member of the ejido expressed his concern over the potential harm to the bees, “because new roadswould be opened with heavy machinery. They said that they would relocate the apiaries but they know nothing about beekeeping. It’s not fair, we are going to be left with nothing,” he said.

Canmex, who has eight apiaries,checks the beehives twice a week, together with four of his six children. He collects about 25 30-kg barrels of honey, which ends up on European tables. Yucatan honey is highly appreciated in the world, for its quality and organic nature.

Luis Miguel, a Mayan farmer from Kimbilá, in the southeastern state of Yucatán, Mexico, fears that the installation of a wind farm in his community will damage local crops of corn and vegetables.  Credit: Emilio Godoy/IPS

Luis Miguel, a Mayan farmer from Kimbilá, in the southeastern state of Yucatán, Mexico, fears that the installation of a wind farm in his community will damage local crops of corn and vegetables. Credit: Emilio Godoy/IPS

Yucatán, part of the ancient Mayan empire, where a large part of the population is still indigenous, has become a new energy frontier in Mexico, due to its great potential in wind and solar power.

This state adopted the goal of using 9.3 per cent non-conventional renewable energies by 2018. In Yucatán, the incorporation per year of new generation capacity should total 1,408 MW by 2030.

Leaving out the big hydropower plants, other renewable sources account for just eight per cent of the electricity produced in Mexico. According to official figures, in December 2016, hydropower had an installed capacity of 12,092 MW, geothermal 873 MW, wind power 699 MW, and photovoltaic solar power, six MW.

According to the Mexican Wind Energy Association, which represents the industry, in Mexico there are at least 31 wind farms located in nine states, with a total installed capacity of 3,527 MW of clean energy for the northeast, west, south and southeast regions of this country of 122 million people.

Besides the lack of information, and of free, prior and informed consent, as the law and international conventions require, indigenous people complain about impacts on migratory birds, rise in temperatures in areas with solar panels and water pollution caused by leaks from wind towers.

For Romel González, a member of the non-governmental Regional Indigenous and Popular Council of Xpujil, a town in the neighboring state of Campeche, the process of energy development has legal loopholes that have to do with superficial contracts and environmental impact studies.

“There is a lack of information for the communities, who don’t know the scope of the contracts; (the companies and authorities) don’t explain to them the problems that are going to arise. Conflicts are generated, and manipulation is used to get the permits. Social engineering is used to divide the communities,” González told IPS.

He said that in the region, there are “previously untapped” natural resources that are attracting attention from those interested in stripping the communities of these resources.

The state is experiencing a clean energy boom, with plans for five solar plants, with a total capacity of 536 MW, and five wind farms, with a combined capacity of 256 MW. The concessions for the projects, which are to operate until 2030, have already been awarded to local and foreign companies.

In the first national power generation auction organised by the government in March 2016, four wind power and five solar power projects won, while in the second one, the following September, two new wind projects were chosen.

The change in the electricity mix is based on Mexico’s energy reform, in force since August 2014, which opened the industry to national and international private capital.

Local authorities project that by 2018, wind power generation will amount to 6,099 MW, including 478 from Yucatán, with the total increasing two years later to 12,823 MW, including 2,227 MW from this state.

Yucatán will draw a projected 52 million dollars in investment to this end in 2017 and 1.58 billion in 2018.

The Electricity Industry Law, in effect since 2014, stipulates that each project requires a social impact assessment. But opponents of the wind power projects have no knowledge of any assessment carried out in the state, while there is only evidence of two public consultations with affected communities, in the case of two wind farms.

“The electricity will not be for us and we don’t know what will happen later (once the wind farm is installed). That is why we have our doubts,” said Miguel.

People in Yucatán do not want to replicate the “Oaxaca model”. That is the southern state which has the largest number of wind farms, which have drawn many accusations of unfair treatment, land dispossession and lack of free, prior and informed consent.

“The authorities want to do this by all means, they are just trying to get these projects approved,” said Canmex.

González criticised the government for failing to require assessments. “We have asked for them and the government has responded that there aren’t any. The community response to the projects will depend on their level of awareness and social organisation. Some communities will react too late, when the project is already underway,” he said.

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The Planned US Border Tax Would Most Likely Violate WTO Rules – Part 2http://www.ipsnews.net/2017/02/the-planned-us-border-tax-would-most-likely-violate-wto-rules-part-2/?utm_source=rss&utm_medium=rss&utm_campaign=the-planned-us-border-tax-would-most-likely-violate-wto-rules-part-2 http://www.ipsnews.net/2017/02/the-planned-us-border-tax-would-most-likely-violate-wto-rules-part-2/#comments Fri, 17 Feb 2017 15:52:20 +0000 Martin Khor http://www.ipsnews.net/?p=148999 The tax on US imports, without the same being applied to US-made products, discriminates against foreign products, and US exports being exempted from taxes is tantamount to being an export subsidy. How will this be taken at the WTO, the guardian of the multilateral trading system? Credit: Amantha Perera/IPS

The tax on US imports, without the same being applied to US-made products, discriminates against foreign products, and US exports being exempted from taxes is tantamount to being an export subsidy. How will this be taken at the WTO, the guardian of the multilateral trading system? Credit: Amantha Perera/IPS

By Martin Khor
PENANG, Feb 17 2017 (IPS)

As American lawmakers and the Trump administration prepare the ground for introducing a border adjustment tax, many controversial issues have emerged, including whether they go against the rules of the World Trade Organisation (WTO).

The border tax is part of the overhaul of the US corporate tax system proposed by Republican Congress leaders and appears to have the support of President Donald Trump.

If adopted, the tax measure is sure to attract the opposition of the United States’ trading partners, as their exports to the US will have the equivalent of a 20% tax imposed on them, whereas the exports from the US will be exempted from a 20% corporate tax.

The tax on US imports, without the same being applied to US-made products, discriminates against foreign products, and US exports being exempted from taxes is tantamount to being an export subsidy.

How will this be taken at the WTO, the guardian of the multilateral trading system?

US Congressman Kevin Brady, chairman of the House Ways and Means Committee, and the plan’s main advocate, is convinced the plan is WTO-consistent, but has yet to explain why.

On the other hand, many trade and legal experts think the plan violates the principles and rules of the WTO, although they caution that a final opinion is possible only when the language of the law is known.

Their general view is as follows: Firstly, the inability to deduct import expenses from a company’s tax (while allowing deductions for locally sourced products and services and wages) discriminates against imports vis-à-vis domestic products, and violates the national treatment principle of the WTO and the rules of the General Agreement on Tariffs and Trade (GATT) which specify that imports must be treated no less favourably than similar locally produced goods.

Secondly, the exemption of export revenues from the taxable income would be most likely assessed as a prohibited export subsidy under the WTO’s subsidies agreement.

The renowned international trade expert, Bhagirath Lal Das, says that there are two separate issues to be considered:  the differential treatment of domestic and imported materials, and the differential tax treatment of income based on whether the product is domestically consumed or exported.

Martin Khor

Martin Khor

Says Das:   “It appears that the proposal is to deduct the cost of domestic input (including wages) from a company’s income while computing the tax, whereas there is no such deduction if a like imported input is used in the production.

“If this be the case, such a provision will clearly violate the principle of national treatment contained in Article III of the GATT 1994.”     Under that article, imported products must be accorded treatment no less favourable than that given to similar domestic products in respect of laws and regulations.

Added Das:  “If the use of the domestic product results in tax reduction whereas the use of the like imported product does not get similar treatment, clearly the imported product will get “less favourable” treatment. And that will violate the principle of national treatment, and it can be successfully challenged in the WTO on this ground.”

On the second issue, the proposal is to differentiate between the earning from domestic sale and that from export in the matter of taxation in respect of a product.

Commented Das:  “Here it would appear that the exemption of the tax is conditional on export. This practice will clearly qualify for being categorised as export subsidy which is prohibited under Article 3 of the WTO’s Subsidy Agreement.”

Das cites a case of an American company, the Domestic International Sales Corporation (DISC).  A portion of its profit which was engaged in export was tax free.  The EEC, the predecessor of EC, raised a dispute in the GATT in 1973. The matter was delayed for a long time until in 1999 a panel at the WTO ruled that the US practice was in fact an export subsidy and was prohibited.

“This case may not be exactly the same as the currently anticipated proposal, but it does point to the fallibility of providing government benefit contingent on export,” says Das.

Das was formerly Chairman of the General Council of GATT,  Indian Ambassador to GATT, and subsequently Director of Trade in the UN Conference on Trade and Development, and has written many books on the WTO and its agreements.

According to another eminent expert on the WTO, Chakravarthi Raghavan, whether the US law is considered “legal” depends on the language of the law and its actual effects.

“There is little doubt that the “pith and substance” of the Republican border tax proposal or ideas will be in violation of Articles II and III of GATT and Article 3.1 of the Subsidies Agreement.”

Raghavan, Chief Editor Emeritus of the South-North Development Monitor, followed and analysed the negotiations of the Uruguay Round and of the WTO on a daily basis ever since.

There are many shortcomings with the WTO dispute system. Few countries have the courage or financial resources to take up cases against the US.
Countries can challenge the US at the WTO and if they succeed the US has to change its law or face retaliatory action.  The winning party can block US exports to it equivalent in value to the loss of its exports to the US.

However, there are many shortcomings with the WTO dispute system.  Few countries have the courage or financial resources to take up cases against the US.

If some countries do take up cases, it takes as long as three to four years for a case in the WTO to wind its way through panel hearings and to a final verdict at the Appellate Body, and for the winning Party to get the go-ahead to take retaliatory action.  During that period, the US can continue with its laws and practices.

If the US loses, it need not pay any compensation to the successful Party for having suffered losses.   Moreover, in the past, when it loses cases at the WTO, the US has typically not complied with the orders made on it.  Even if it does comply, it needs to do so only in respect of the Parties that brought the action against it; it need not do so for other Parties.

If it does not comply, the complainant countries are allowed to take retaliatory action by blocking US goods and services from entering their markets up to an amount equivalent to the losses they have suffered.  This retaliatory action can only be taken by those countries that successfully took up the cases.

Thus, the US may decide to implement the border adjustment taxes and wait two to four years before a final judgment is made at the WTO, and for retaliatory action to be allowed by the WTO.   It can meanwhile reap the benefits of its border tax measures.

Another possibility is that Trump may make good his threat to leave the WTO, if important cases go against it.  That would cause a major crisis for the WTO and for international trade.

With regard to the WTO process, Raghavan said:   “Apart from the difficulties of taking up cases in the WTO, including costs, the lengthy process and no retrospective damages when any WTO member, raises a dispute, the onus of proving the violation is on them.

“To the best of my knowledge, in none of the rulings against US, requiring changes in law or regulations, has the US implemented them, and even major trading partners have been chary of taking retaliation action.

“Countries that are affected, could act to unilaterally deny the US some rights; but they cannot justify that this is retaliation, until there is a ruling in their favour.”

American advocates of the border adjustment tax plan have claimed that it is similar to a value added tax (VAT) which is considered by the WTO to be a legitimate measure;  and thus that the border adjustment tax would also be compatible with the WTO.

Almost all major developed countries have instituted the VAT system, with the notable exception of the US.  The Republican Congress leaders and Trump have argued  that this places the US at a disadvantage in its trade relations because the VAT system imposes a tax on imports, whilst allowing companies to obtain a refund for taxes paid on their exports.

They claim the border tax would correct this disadvantage that the WTO should similarly recognise the border tax as legitimate.

However, several well-known economists and lawyers are of the opinion that there are important differences between the VAT and the border tax.

There are two parts of their arguments.  Firstly, the VAT imposes taxes on both imports and locally produced goods and services and therefore does not discriminate against imports;  whereas the border tax system imposes a tax on imports whilst excluding domestic inputs and wages from tax, which therefore discriminates against imports.  Secondly, the VAT system does not subsidise exports, whereas the border tax system does.

In a 1990 paper, Martin Feldstein and Paul Krugman found that the VAT does not improved the trade competitiveness of countries using it.  They said:  “The point that VATs do not inherently affect international trade flows has been well recognised in the international tax literature…A VAT Is not a protectionist measure.”

Krugman, in a recent blog, reiterated that “a VAT does not give a nation any kind of competitive advantage, period.”  But a destination-based cash flow tax like the border adjustment tax has a subsidy element that “would lead to expanded domestic production.”

In another paper, Reeven Avi-Yonah and Kimberly Clausing  from Michigan Law School and Reed College respectively analyse the difference between the VAT and the proposed border adjustment tax and why the former is WTO-consistent whereas the latter would violate WTO rules.

They said:   “U.S. trading partners are likely to be hurt in several ways. The effects of the wage deduction render the corporate cashflow tax different from a VAT, and these differences have the net effect of increasing the incentive to operate in the United States

“In addition, such a tax system would exacerbate the profit shifting problems of our trading partners, since the United States will appear like a tax haven from their perspective.”

Economists also agree that the border tax will raise the value of the US dollar but there is a debate as to how long this will take and by how much it will rise. If the dollar appreciation is significant, this may have an adverse effect on countries that hold debt in US dollars, as they would have to pay out more in their domestic currency to service their loans. This would include many developing countries with substantial dollar-denominated debts of the public or private sectors, and some of them may tip into new debt and financial crises.    According to former US Treasury Secretary Lawrence Summers:  “Proponents of the plan anticipate a rise in the dollar by an amount equal to the 15 to 20 per cent tax rate.  This would do huge damage to dollar debtors all over the world and provoke financial crises in some emerging markets.”           

This article is the second in a two-part series on the border adjustment tax, which would have the effect of taxing imports of goods and services that enter the United States, while also providing a subsidy for US exports which would be exempted from the tax. You can find Part 1 here

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Still in Limbo, Somaliland Banking on Berberahttp://www.ipsnews.net/2017/02/still-in-limbo-somaliland-banking-on-berbera/?utm_source=rss&utm_medium=rss&utm_campaign=still-in-limbo-somaliland-banking-on-berbera http://www.ipsnews.net/2017/02/still-in-limbo-somaliland-banking-on-berbera/#comments Fri, 17 Feb 2017 13:10:31 +0000 James Jeffrey http://www.ipsnews.net/?p=148992 In the capital people encounter a mishmash of chaotic local market commerce existing alongside diaspora-funded construction including glass-fronted office buildings, Wi-Fi enabled cafes and air-conditioned gyms, all suffused with characteristic Somali energy and dynamism. Credit: James Jeffrey/IPS

In the capital people encounter a mishmash of chaotic local market commerce existing alongside diaspora-funded construction including glass-fronted office buildings, Wi-Fi enabled cafes and air-conditioned gyms, all suffused with characteristic Somali energy and dynamism. Credit: James Jeffrey/IPS

By James Jeffrey
HARGEISA, Somaliland, Feb 17 2017 (IPS)

Crossing African borders by land can be an intimidating process (it’s proving an increasingly intimidating process nowadays in Europe and the US also, even in airports). But crossing from Ethiopia to Somaliland at the ramshackle border town of Togo-Wuchale is a surreally pleasant experience.

Immigration officials on the Somaliland side leave aside the tough cross-examination routine, greeting you with big smiles and friendly chit chat as they whack an entry stamp on the Somaliland visa in your passport.“If you look at the happiness of Somalilanders and the challenges they are facing, it does not match.” --Khadar Husein, Operational director of the Hargeisa office of Transparency Solutions.

They’re always happy to see a foreigner’s visit providing recognition of their country that technically still doesn’t exist in the eyes of the rest of the political world, despite having proclaimed its independence from Somalia in 1991, following a civil war that killed about 50,000 in the region.

A British protectorate from 1886 until 1960 and unifying with what was then Italian Somaliland to create modern Somalia, Somaliland had got used to going on its own since that 1991 declaration, and today exhibits many of the trappings of a functioning state: its own currency, a functioning bureaucracy, trained police and military, law and order on the streets. Furthermore, since 2003 Somaliland has held a series of democratic elections resulting in orderly transfers of power.

Somaliland’s resolve is most clearly demonstrated in the capital, Hargeisa, formerly war-torn rubble in 1991 at the end of the civil war, its population living in refugee camps in neighbouring Ethiopia. An event that lives on in infamy saw the jets of military dictator Mohammed Siad Barre’s regime take off from the airport and circle back to bomb the city.

But visitors to today’s sun-blasted city of 800,000 people encounter a mishmash of impassioned traditional local markets cheek by jowl with diaspora-funded modern glass-fronted office blocks and malls, Wi-Fi enabled cafes and air-conditioned gyms, all suffused with typical Somali energy and dynamism.

“We are doing all the right things that the West preaches about but we continue to get nothing for it,” says Osman Abdillahi Sahardeed, minister for the Ministry of Information, Culture and National Guidance. “This is a resilient country that depends on each other—we’re not after a hand out but a hand up.”

Non-statehood deprives Somaliland of direct large-scale international support from the likes of the World Bank and International Monetary Fund. For these members of the Somaliland Seaman’s Union at Berbera Port’s docks, it means they are not paid the same wages—they earn about $220 a month—as paid to foreign workers due to not belonging to an internationally recognised organisation. Credit: James Jeffrey/IPS

Non-statehood deprives Somaliland of direct large-scale international support from the likes of the World Bank and International Monetary Fund. For these members of the Somaliland Seaman’s Union at Berbera Port’s docks, it means they are not paid the same wages—they earn about $220 a month—as paid to foreign workers due to not belonging to an internationally recognised organisation. Credit: James Jeffrey/IPS

Increasing levels of exasperation within Somaliland’s government and among the populace are hardly surprising. Somaliland’s apparent success story against the odds remains highly vulnerable. Its economy is perilously fragile. Non-statehood deprives it of direct large-scale international support and access to the likes of the World Bank and International Monetary Fund (I.M.F.).

As a result, the government has a tiny budget of about 250 million dollars, with about 60 percent spent on police and security forces to maintain what the country views as one of its greatest assets and reasons for recognition: continuing peace and stability. Also, it relies heavily on the support of local clan elders—it is hard for any government to prove its legitimacy when essential services need the help of international humanitarian organizations, local NGOs and the private sector.

Indeed, Somaliland survives to a large extent on money sent by its diaspora—estimated to range from $400 million to at least double that annually—and by selling prodigious quantities of livestock to Arab countries.

All the while, poverty remains widespread and swathes of men on streets sipping sweet Somali tea and chewing the stimulating plant khat throughout the day testify to chronic unemployment rates.

“About 70 percent of the population are younger than 30, and they have no future without recognition,” says Jama Musse, a former mathematics professor who left Italy to return to Somaliland to run the Red Sea Cultural Foundation center, which offers cultural and artistic opportunities for Hargeisa’s youth. “The world can’t close its eyes—it should deal with Somaliland.”

Peace and security hold in Somaliland, so effectively that moneychangers can safely stash bundles of cash on the street. Credit: James Jeffrey/IPS

Peace and security hold in Somaliland, so effectively that moneychangers can safely stash bundles of cash on the street. Credit: James Jeffrey/IPS

For now, Somaliland’s peace holds admirably well.

“If you look at the happiness of Somalilanders and the challenges they are facing it does not match,” says Khadar Husein, operational director of the Hargeisa office of Transparency Solutions, a UK-based consultancy focused on civil society capacity building in Somaliland and Somalia. “They are happy because of their values and religion.”

But others speak of the risks of encroaching Wahhabism, a far more fundamental version of Islam compared to Somaliland’s conservative though relatively moderate religiousness, and a particular concern in a volatile part of the world.

“Young men are a ready-made pool of rudderless youth from which militant extremists with an agenda can recruit,” says Rakiya Omaar, a lawyer and Chair of Horizon Institute, a Somaliland consultancy firm helping communities transition from underdevelopment to stability.

Almost everyone acknowledges the country’s present means of sustainment—heavily reliant on the private sector and diaspora—must diversity. Somaliland needs greater income to develop and survive.

Abdi Muhammad, a veteran of the Somali civil war, makes his feelings clear. Credit: James Jeffrey/IPS

Abdi Muhammad, a veteran of the Somali civil war, makes his feelings clear. Credit: James Jeffrey/IPS

For many, the key to Somaliland’s much needed economic renaissance lies in tapping into the far stronger economy next door: Ethiopia, Africa’s second most populous country and its fastest growing economy, according to the I.M.F.

Crucial to achieving this is Berbera, a name conjuring images of tropical quays and fiery sunsets. Once an ancient nexus of maritime trade, Berbera has long been eclipsed by Djibouti’s ports to the north. But Berbera Port is now on the brink of a major expansion that could transform and return it to a regional transportation hub, and also help fund Somaliland’s nation-building dreams.

In May 2016, Dubai-based DP World was awarded the concession to manage and expand Berbera for 30 years, a project valued at about 442 million dollars, including expanding the port and refurbishing the 268-kilometer route from the port to the border with Ethiopia.

Landlocked Ethiopia has long been looking to diversify its access to the sea, an issue of immense strategic anxiety. Currently 90 percent of its trade goes through Djibouti, a tiny country with an expanding network of ports that scoops at least 1 billion dollars in port fees from Ethiopia every year.

Somaliland would like about 30 percent of that trade through Berbera, and Ethiopia is more than happy with that, allocating such a proportion in its latest Growth and Transformation Plan that sets economic policy until 2020.

Ethiopia and Somaliland had already signed a Memorandum Of Understanding (MOU) covering trade, security, health and education in 2014, before in March 2016 signing a trade agreement on using Berbera Port. And Ethiopia could just be the start.

“It would be a gateway to Africa, not just Ethiopia,” says Sharmarke Jama, a trade and economic adviser for the Somaliland government during negotiations on the port concession. “The multiplying benefits for Somaliland’s economy could be endless.”

Somaliland officials hope increased trade at the port will enable greater self-sufficiency to develop the country, while also chipping away at the international community’s resistance over recognition.

“As our economic interests align with the region and we become more economically integrated, that can only help with recognition,” Sharmarke says.

Perhaps. The political odds are stacked against Somaliland due to concerns that recognizing Somaliland would undermine decades of international efforts to patch up Somalia, and open a Pandora ’s Box of separatist claims in the region and further afield around Africa.

But greater self-sufficiency would undoubtedly result from a resurgent Berbera, and without this crucial infrastructure revival Somaliland’s economic potential will remain untapped, trapping its people in endless cycles of dependence, leaving those idle youth on street corners.

On April 13, 2016, up to 500 migrants died after a boat capsized crossing the Mediterranean. Most media reported that a large portion of those who died were from Somalia. But in Hargeisa following the tragedy, locals noted how many of those who died were more specifically Somalilanders.

“Why are they leaving? Unemployment,” says Abdillahi Duhe, former Foreign Minister of Somaliland and now a consultant in the Ethiopian capital, Addis Ababa. “Now is a very important time: we’ve passed the stage of recovery, we have peace—but many hindrances remain.”

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Beware of the New US Protectionist Plan, the Border Adjustment Tax – Part 1http://www.ipsnews.net/2017/02/beware-of-the-new-us-protectionist-plan-the-border-adjustment-tax/?utm_source=rss&utm_medium=rss&utm_campaign=beware-of-the-new-us-protectionist-plan-the-border-adjustment-tax http://www.ipsnews.net/2017/02/beware-of-the-new-us-protectionist-plan-the-border-adjustment-tax/#comments Fri, 17 Feb 2017 12:37:51 +0000 Martin Khor http://www.ipsnews.net/?p=148990 If the tax plan is implemented it will have serious adverse effects on many contries, like China or Mexico, which sell hundreds of billions of dollars of manufactured products to the US. Credit: Bigstock

If the tax plan is implemented it will have serious adverse effects on many contries, like China or Mexico, which sell hundreds of billions of dollars of manufactured products to the US. Credit: Bigstock

By Martin Khor
PENANG, Feb 17 2017 (IPS)

A new and deadly form of protectionism is being considered by Congress leaders and the President of the United States that could have devastating effect on the exports and investments of American trading partners, especially the developing countries.

The plan, known as a border adjustment tax, would have the effect of taxing imports of goods and services that enter the United States, while also providing a subsidy for US exports which would be exempted from the tax.

The aim is to improve the competitiveness of US products, drastically reduce the country’s imports while promoting its exports, and thus reduce the huge US trade deficit.

On the other hand, if adopted, it would significantly reduce the competitiveness or viability of goods and services of countries presently exporting to the US.  The prices of these exports will have to rise due to the tax effect, depressing their demand and in some cases make them unsalable.

And companies from the US or other countries that have invested in developing countries because of cheaper costs and then export their products to the US will be adversely affected because of the new US import tax.

Some firms will relocate to the US.   Potential investors will be discouraged from opening new factories in the developing countries.  In fact this is one of the main aims of the plan – to get companies return to the US.

The plan is a key part of the America First strategy of US President Donald Trump, with his subsidiary policies of “Buy American” and “Hire Americans.”

The border adjustment tax is part of a tax reform blueprint “A Better Way” whose chief advocates are Republican leaders Paul Ryan, speaker of the House of Representatives and Kevin Brady, Chairman of the House Ways and Means Committee.

President Trump originally called the plan “too complicated” but is now considering it seriously.  In a recent address to congressional Republicans, Trump said:  “We’re working on a tax reform bill that will reduce our trade deficits, increase American exports and will generate revenue from Mexico that will pay for the (border) wall.”

Martin Khor

Martin Khor

The proposal has however generated a tremendous controversy in the US, with opposition coming from some Congress members (including Republicans), many economists and American companies whose business is import-intensive.

It however has the strong support of Republican Congress leaders and some version of it could be tabled as a bill.

Trump had earlier threatened to impose high tariffs on imports from countries having a trade surplus with the US, especially China and Mexico.

This might be a more simple measure, but is so blatantly protectionist that it would be sure to trigger swift retaliation, and would also almost certainly be found to violate the rules of the World Trade Organisation (WTO).

The tax adjustment plan may have a similar effect in discouraging imports and moreover would promote exports, but it is more complex and thus difficult to understand.

The advocates hope that because of the complexity and confusion, the measure may not attract such a strong response from US trading partners.  Moreover they claim it is permitted by the WTO are presumably willing to put it to the test.

In the tax reform plan, the corporate tax rate would be reduced from the present 35% to 20%.   The border adjustment aspect of the plan has two main components. Firstly, the expenses of a company on imported goods and services can no longer be deducted from a company’s taxable income.  Wages and domestically produced inputs purchased by the company can be deducted.

The effect is that a 20% tax would be applied to the companies’ imports.

This would especially hit companies that rely on imports such as automobiles, electronic products, clothing, toys and the retail and oil refining sectors.

The Wall Street Journal gives the example of a firm with a revenue of $10,000 and with $5,000 imports, $2 000 wage costs and $3,000 profit.  Under the present system, where the $5,000 imports plus the $2,000 wages can be deducted, and with a 35% tax rate, the company’s taxable total would be $3,000, tax would be $1,050 and after-tax profit would be $1,950.

Under the new plan, the $5,000 imports cannot be deducted and would form part of the new taxable total of $8,000.  With a 20% tax rate, the tax would be $1,600 and the after-tax profit $1,400.

Given this scenario, if the company wants to retain his profit margin, it would have to raise its price and revenue significantly, but this in turn would reduce the volume of demand for the imported goods.

For firms that are more import-dependent, or with lower profit margin, the situation may be even more dire, as some may not be financially viable anymore.

Take the example of a company with $10,000 revenue, $7,000 imports, $2,000 wages and $1,000 profit.   With the new plan, the taxable total is $8,000 and the tax is $1,600, so after tax it has a loss of $600 instead of a profit of $1,000.

The company, to stay alive, would have to raise its prices very significantly, but that might make its imported product much less competitive.  In the worst case, it would close, and the imports would cease.

The economist Larry Summers, a former Treasury Secretary, gives a similar example of a retailer who imports goods for 60 cents, incurs 30 cents in labour and interest costs and then earns a 5 cent margin.  With 20% tax, and no ability to deduct import or interest costs, the taxes will substantially exceed 100% of profits even if there is some offset from a stronger dollar.

On the other hand, the new plan allows a firm to deduct revenue from its exports from its taxable income.  This would allow the firm to increase its after-tax profit.

The Wall Street Journal article gives the example of a firm which presently has export sales of $10,000, cost of inputs $5,000, wages $2,000 and profit $3,000.  With the 35% corporate tax rate, the tax is $1,050 and after-tax profit is $1,950.

Perhaps the most vulnerable country is Mexico, where many factories were established to take advantage of tariff-free entry to the US market under the North American Free Trade Agreement. President Trump has warned American as well as German and Japanese auto companies that if they make new investments in Mexico, their products would face high taxes or tariffs on entry, and called on them to invest in the US instead.
Under the new plan, the export sales of $10,000 is exempt from tax, so the company has zero tax.  Its profit after tax is thus $3,000.   The company can cut its export prices, demand for its product increases and the company can expand its sales and export revenues.

At the macro level, with imports reduced and exports increased, the US can cut its trade deficit, which is a major aim of the plan.

On the other hand, the US is a major export market for many developing countries, so the tax plan if implemented will have serious adverse effects on them.

The countries range from China and Mexico, which sell hundreds of billions of dollars of manufactured products to the US; to Brazil and Argentina which are major agricultural exporters; to Malaysia, Indonesia and Vietnam which sell commodities like palm oil and timber and also manufactured goods such as electronic products and components and textiles, Arab countries that export oil, and African countries that export oil, minerals and other commodities, and countries like India which provide services such as call services and accountancy services to US companies.

American industrial companies are also investors in many developing countries. The tax plan if implemented would reduce the incentives for some of these companies to be located abroad as the low-cost advantage of the foreign countries would be offset by the inability of the parent company to claim tax deductions for the goods imported from their subsidiary companies abroad.

Perhaps the most vulnerable country is Mexico, where many factories were established to take advantage of tariff-free entry to the US market under the North American Free Trade Agreement.  President Trump has warned American as well as German and Japanese auto companies that if they make new investments in Mexico, their products would face high taxes or tariffs on entry, and called on them to invest in the US instead.

After the implications of the border adjustment plan are understood, it is bound to generate concern and outrage from the United States’ trading partners, in both South and North, if implemented.  They can be expected to consider immediate retaliatory measures.

A former undersecretary for international business negotiations of Mexico (2000-2006), Luis de la Calle, said  in a media interview:  “If the US wants to move to this new border tax approach, Mexico and Canada would have to do the same….We have to prepare for that scenario.”

In any case, it can be expected that countries will take up complaints against the US at the WTO.   The proponents claim the tax plan will be designed in a way that is compatible with the WTO rules.

But many international trade law experts believe the tax plan’s measures will violate several of the WTO’s principles and agreements, and that the US will lose if other countries take up cases against it in the WTO dispute settlement system.

This prospect may however not decisively deter Trump from championing the Republicans’ tax blueprint and signing it into law, should Congress decide to adopt it.

The President and some of his trade advisors have criticised the WTO’s rules and have mentioned the option of leaving the organisation if it prevents or impedes the new America First strategy from being implemented.  If the US leaves the WTO, it would of course cause a major crisis for international trade and trade relations.

There are many critics of the plan.  Lawrence Summers, a former US Treasury Secretary, warns that the tax change will worsen inequality, place punitive burdens on import-intensive sectors and companies, and harm the global economy.

The tax plan is expected to cause a 15-20% rise in the US dollar.  “This would do huge damage to dollar debtors all over the world and provoke financial crises in some emerging markets,” according to Summers.

While export-oriented US companies are supporters, other US companies including giants Walmart and Apple are strongly against the border tax plan, and an influential Republican, Steven Forbes, owner of Forbes magazine, has called the plan “insane.”

It is not yet clear what Trump’s final position will be. If he finds it too difficult to use the proposed border tax, because of the effect on some American companies and sectors, he might opt for the simpler use of tariffs.

In any case, whether tariffs or border taxes, policy makers and companies and employees especially in developing countries should pay attention to the trade policies being cooked up in Washington, and to voice their opinions.

Otherwise they may wake up to a world where their products are blocked from the US, the world’s largest market, and where the companies that were once so happy to make money in their countries suddenly pack up and return home.

This article is the first in a two-part series on the border adjustment tax, which would have the effect of taxing imports of goods and services that enter the United States, while also providing a subsidy for US exports which would be exempted from the tax. You can find Part 2 here

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Improved Cookstoves Boost Health and Forest Cover in the Himalayashttp://www.ipsnews.net/2017/02/improved-cookstoves-boost-health-and-forest-cover-in-the-himalayas/?utm_source=rss&utm_medium=rss&utm_campaign=improved-cookstoves-boost-health-and-forest-cover-in-the-himalayas http://www.ipsnews.net/2017/02/improved-cookstoves-boost-health-and-forest-cover-in-the-himalayas/#comments Fri, 17 Feb 2017 11:13:23 +0000 Athar Parvaiz http://www.ipsnews.net/?p=148986 Women and children are the primary victims of indoor air pollution in poor, rural areas of India. Credit: Athar Parvaiz/IPS

Women and children are the primary victims of indoor air pollution in poor, rural areas of India. Credit: Athar Parvaiz/IPS

By Athar Parvaiz
DARJEELING, India, Feb 17 2017 (IPS)

Mountain communities in the Himalayan region are almost entirely dependent on forests for firewood even though this practice has been identified as one of the most significant causes of forest decline and a major source of indoor air pollution.

Improper burning of fuels such as firewood in confined spaces releases a range of dangerous  air pollutants, whereas collection of firewood and cooking on traditional stoves consumes a lot of time, especially for women.

The WHO estimates that around 4.3 million people die globally each year from diseases attributable to indoor air pollution. Women and children are said to be at far greater risk of suffering the impacts of indoor pollution since they spend longer hours at home.

Data from the Government of India’s 2011 Census shows that 142 million rural households in the country depend entirely on fuels such as firewood and cow dung for cooking.

Despite heavy subsidies by successive federal governments in New Delhi since 1985 to make cleaner fuels like LPG available to the poor, millions of households still struggle to make the necessary payments for cleaner energy, which compels them to opt for traditional and more harmful substances.

This has prompted environmental organisations like Bangalore-based Ashoka Trust for Research in Ecology and Environment (ATREE) to help mountain communities minimise the health and environmental risks involved in using firewood for cooking in confined places.

IPS spoke with the Regional Director of ATREE for northeast India, Sarala Khaling, who oversees the Improved Cooking Stoves (ICS) project being run by the organisation in Darjeeling, Himalayas. Excerpts from the interview follow.

The Improved Cooking Stove (ICS) keeps this kitchen in India’s Himalaya region smoke-free. Credit: Athar Parvaiz/IPS

The Improved Cooking Stove (ICS) keeps this kitchen in India’s Himalaya region smoke-free. Credit: Athar Parvaiz/IPS

IPS: What prompted you to start the ICS programme in the Darjeeling Himalayan region?    

Sarala Khaling: In many remote forest regions of Darjeeling we conducted a survey and found out that people rely on firewood because it is the only cheap source in comparison to LPG, kerosene and electricity. Our survey result found that around Singhalila National Park and Senchal Wildlife Sanctuary, the mean fuel wood consumption was found to be 23.56 kgs per household per day.

Therefore, we thought of providing technological support to these people for minimizing forest degradation and indoor pollution which is hazardous to human health and contributes to global warming as well. That is how we started replacing the traditional cooking stoves with the improved cooking stoves, which consume far less fuel wood besides reducing the pollution.

IPS: How many ICS have you installed so far?  

SK: Till now ATREE has installed 668 units of ICS in different villages of Darjeeling. After the installation of ICS, we conducted another survey and the results showed reduction of fuel wood consumption by 40 to 50 per cent and also saved 10 to 15 minutes of time while cooking apart from keeping the kitchens free of smoke and air pollution.

We have trained more than 200 community members and have selected “ICS Promoters” from these so that we can set up a micro-enterprise on this. There are eight models of ICS for different target groups such as those cooking for family, cooking for livestock and commercial models that cater to hostels, hotels and schools.

IPS: When did the project begin? 

SK: We have been working on efficient energy since 2012. This technology was adopted from the adjacent area of Nepal, from the Ilam district. All the models we have adopted are from the Nepalese organization Namsaling Community Development Centre, Ilam. This is because of the cultural as well as climatic similarities of the region. Kitchen and adoption of the type of “chulah” or stove has a lot to do with culture. And unless the models are made appropriate to the local culture, communities will not accept such technologies.

IPS: Who are the beneficiaries?

SK: Beneficiaries are local communities from 30 villages we work in as these people are entirely dependent on the fuel wood and live in the forest fringes.

IPS: What are the health benefits of using ICS? For example, what can be the health benefits for women and children? 

SK: Women spend the most time in the kitchen, which means young children who are dependent on the mothers also spend a large part of their time in the kitchen. The smokeless environment in the kitchen definitely must be having a positive effect on health, especially respiratory conditions. Also the kitchen is cleaner and so are the utensils. And then using less fuel wood means women spend lesser time collecting them thus saving themselves the drudgery.

IPS: What is the feedback from the beneficiaries? 

SK: The feedback has been positive from people who have adopted this technology. They say that ICS takes less fuel wood and it gives them a lot of comfort to cook in a smoke free environment. Women told us that their kitchens are looking cleaner as so also the utensils.

IPS: How much it costs to have a clean stove? And can a household get it on its own? 

SK:  It costs around INR 2500 (37 dollars) to make a stove. ATREE supports only the labour charges for making a unit. Of course we support all the training, mobilising, monitoring and outreach and extension. Yes, there are many houses outside of our project sites who have also adopted this technology. The material used for making the clean stove is made locally like bricks, cow dung, salt, molasses and some pieces of iron.

IPS: Since you say that you are training local people to make these stoves, do you have any target how many households you want to cover in a certain time-period? 

SK:  We are looking to provide 1200 units to as many households. But, depending on the uptake, we will scale up. Our main objective is to make this sustainable and not something that is handed out as free. Our model is to select community members and train them.

We want these trained community members become resource persons and organise themselves into a micro-enterprise of ICS promoters. We want these people to sell their skills to more and more villages because we believe people will pay to make and adopt this technology. We are noticing that this has already started happening.

IPS: Have you provided this technology to any hostels, hotels etc?

SK: Yes, government schools who have the midday meal systems have also adopted this. There are about half a dozen schools which are using ICS and we are mobilizing more to adopt this technology.

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Can Bangladesh Become an Economic Powerhouse?http://www.ipsnews.net/2017/02/can-bangladesh-become-an-economic-powerhouse/?utm_source=rss&utm_medium=rss&utm_campaign=can-bangladesh-become-an-economic-powerhouse http://www.ipsnews.net/2017/02/can-bangladesh-become-an-economic-powerhouse/#comments Thu, 16 Feb 2017 16:36:16 +0000 Eresh Omar Jamal http://www.ipsnews.net/?p=148984 By Eresh Omar Jamal
Feb 16 2017 (The Daily Star, Bangladesh)

According to Pricewaterhouse Coopers, Bangladesh has the potential to become the world’s 23rd largest economy by 2050. In a report released earlier this month, PwC also predicted Bangladesh would be the 28th biggest economy by 2030 in terms of its Gross Domestic Product calculated at Purchasing Power Parity. This may not seem like a big deal given that Bangladesh already has the 31st largest economy in the world in terms of total GDP; however, thinking along that line may be misleading given the bigger picture.

Image: venturebeat

Image: venturebeat

First of all, moving up eight places in the ranking will itself be quite an achievement given the urgency with which countries in the modern world are competing with each other on the economic front. Secondly, and perhaps more importantly, the projection shows Bangladesh’s economy growing from USD 628 billion in 2016 to USD 1,324 billion in 2030 and then to USD 3,064 billion in the year 2050.

This will put Bangladesh right behind Canada with a GDP of USD 3,100 billion in 2050 having increased the size of its economy nearly five-fold since 2016, whereas the Canadian economy, over the same period, would have only doubled its current size as would the world economy. This amazing potential for Bangladesh to rapidly increase the size of its economy has even been highlighted by PwC’s report which says, “We project Vietnam, India and Bangladesh to be three of the world’s fastest growing economies over this period [between 2016 and 2050]”.

With an average annual growth of about 5 percent, largely because of its “youthful and working age population”, Bangladesh does have the potential to make rapid progress. But as a report by the Centre for Development and Employment Research showed, 25 percent of the population in Bangladesh between the ages of 15 and 29 — numbering around 11 million — are currently inactive, i.e. they are neither in the education cycle nor involved with any economic activity. Moreover, and this to some may seem even more perplexing, “the prevalence of unemployment is greater among the higher educated section of the youth”.

Given that about 40 percent of Bangladesh’s population is comprised of the youth, this is indeed a grim reality. Simultaneously, it is also a classic example of the unfathomably high inefficiency that plagues every sector of our economy. What, after all, could be a better way of wasting, what one could argue, is the country’s most valuable and abundant resource, than to leave the youth out of the mainstream economy? And, that too, the most educated sections of it?

But in order to live up to its true potential, the country quickly needs to change this scenario around. Bringing the youth into the fold will not only help the economy by increasing overall productivity, but will also help lower various external costs which in itself will prove to be of great benefit.

Another point worthy of mention is that in order to realise its full economic potential, similar to other emerging markets, the Bangladesh government, according to PwC, would have to “implement structural reforms to improve” its “macroeconomic stability, infrastructure and institutions”. And this is where the biggest challenge lies.

The amount of corruption in every sector of our country has become so internalised, that reversing this will not be easy, albeit indispensable for growth. Corruption is not only holding development back through the misallocation of resources, delay in project implementation and completion, but is also wreaking havoc in our banking sector.

For example, although the industry’s average default loan is currently 10.34 percent, it is around 25 percent for the state-owned banks. Even the Governor of the Bangladesh Bank has recently had to admit that “It would be difficult to attain a higher economic growth if the rate of default loans remains high”. Though this exact sentiment has been repeated by experts for years now, what we have seen the government do ultimately is to let those responsible for the increase in dubious or bad loans get off the hook scot-free, leaving taxpayers holding the bill.

We have already seen during the 2008 global financial crisis what this can do. We have also seen the eventual outcome of ‘bailing’ banks out. And yet, it seems we have failed to take any lessons from it. Who is to say that a similar liquidity crisis cannot set us back by years if we continue down the same path? The truth is, no one can, as that is the guaranteed outcome down the path we are pursuing.

At the same time, corruption is also the biggest hindrance we face when it comes to developing our infrastructure. Clearly the infrastructure we have now is completely inadequate to support businesses and other economic activities on a large enough scale. However, even with massive investments coming in from abroad, the pace at which development is taking shape is still quite slow. In the interest of quickening them and to allow businesses to set up and function competitively, the government urgently needs to introduce many structural reforms and changes.

The fact of the matter is that Bangladesh has all the tools available at its disposal to rapidly move its economy ahead in the years to come. What it does need is to sort out some of the most basic problems which it has failed to address for decades despite the solutions to those problems being quite clear-cut. And the main reason for that has been a lack of political will. If, however, that political will is found, who is to say that Bangladesh cannot become an economic powerhouse, capable of providing a peaceful and decent life for all its citizens? Now, is that not an end worth pursuing?

The writer is a member of the editorial team at The Daily Star.

This story was originally published by The Daily Star, Bangladesh

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Corruption Killshttp://www.ipsnews.net/2017/02/corruption-kills-2/?utm_source=rss&utm_medium=rss&utm_campaign=corruption-kills-2 http://www.ipsnews.net/2017/02/corruption-kills-2/#comments Thu, 16 Feb 2017 16:27:46 +0000 Felino Palafox http://www.ipsnews.net/?p=148982 By Felino A. Palafox, JR.
Feb 16 2017 (Manila Times)

Preparing for earthquakes should go beyond first aid preparation. Most of the time schools, companies and government offices equip employees, workers, and students the basic knowledge of stop, drop, cover, hold, and then evacuate to open spaces, as protocols in the event of an earthquake. As an extra preparation, like in our offices at Palafox Associates and Palafox Architecture, all of our employees are equipped with emergency kits that have a whistle, flashlight, bottle of water, compass, first aid kit, and multi-function portable tools. Identified members of the company are trained to do first aid, rappelling, and coordination for emergencies. But at the end of the day, these are things that we hope will not be necessary because preparation goes beyond first-aid reactionary measures.

FELINO A. PALAFOX, JR.

FELINO A. PALAFOX, JR.

In the Building Code and in the Structural Code (written in the 1970s), the liability of an architect and an engineer is only 25 years, and buildings are required to withstand at least an intensity 7 to 8 earthquake. In essence, the building code suggests that the life span and accountability of the building and other structures are only 25 years.

But a question hangs over our heads: after 25 years who will be made accountable if proven that the design and the materials used for the structure was sub-standard? Even if it is in the interest of a client to reduce costs, are developers, contractors, and designers allowed to lower down specifications? The local government is mandated, through the city engineering office, to check and audit structures if certain areas are fit for occupancy; so, in the event of a building collapse, what is the accountability of government officials who signed the occupancy permits?

The earthquake in Surigao is an unfortunate one, but nature should not be used as an excuse for complacency. For the past hundred years, earthquakes have always been a consistent event. There are even departments created to study fault lines to aid zoning and development in certain areas. For the Philippines, as well as Japan and other countries that are in the Pacific Ring of Fire, earthquakes have been part of history. But if we look at Japan, casualty and collapse during earthquakes of high intensities yield relatively low casualties.

When an earthquake devastated Haiti in 2010, Anna Coren of CNN interviewed me on the possible impact of an earthquake with a similar magnitude should it happen in Metro Manila. I cited a study done by the Japan International Cooperation Agency in 2004 on “Metro Manila Earthquake Impact Reduction,” also known as the MMEIRS study. It assessed and somehow quantified the impact and damage the earthquake will cause. With the West Valley fault ripe for movement, as the PHIVOLCS says, it will be important to look back to the MMEIRS report for guidance. It should also be updated using today’s data to see the extent of the possible consequences.

The first 72 hours
According to the MMEIRS study, around 170,000 residential houses will be heavily damaged or collapsed (13 percent of total buildings), 340,000 will be moderately damaged (26 percent of total buildings) and 10,000 alongside the Manila Bay will be affected by liquefaction in the first hour of impact by a magnitude 7.2 earthquake.

Eleven percent of mid-rise buildings (10 to 30 stories) and 2 percent of high-rise buildings (30 to 60 stories) will be severely damaged or collapsed. Twenty-seven percent of mid-rise and 12 percent of high-rise buildings will be moderately damaged.

Eight to 10 percent of hospitals, schools, fire stations, police stations and government offices will be heavily damaged or collapsed. Twenty to 25 percent will be moderately damaged. Death tolls in the first hour could reach around 34,000 people and another 20,000 could become casualties in the succeeding hours because of widespread fires and successive tremors that will occur.

In the event of a “Big One,” rescue activities will be limited. As it is, it takes two hours to travel five kilometers on an average day in Metro Manila but with buildings and electrical posts toppled down, thousands of homes on fire, no water supply and debris, among others, it would take longer for rescuers to reach devastated areas. This is also assuming that our government forces and volunteers are safe and pieces of equipment are intact and operational. According to international assessment, help will come after 72 hours but because of Metro Manila’s urban sprawl and poor urban design, I think we can expect that it will take more time.

Immediate action and long-term preparedness
Palafox Associates and Palafox Architecture Group have sent 145 recommendations on disaster preparedness to the Office of the President—from Presidents Arroyo, Aquino, and Duterte. We recommended that we should immediately implement a strict structural audit of buildings that are earthquake- and fire-hazard. Structures weaken over time because of numerous vibrations caused by smaller intensity movements. Houses and buildings that are old as well as houses and buildings that have sub-standard designs should also be checked.

The government should most especially retrofit and repair our major bridges, government buildings, schools, hospitals and other infrastructure. They also need to dedicate more open spaces for evacuation sites and these sites should have a quick response team that can set up a clinic, clean water station, food quarters, place of worship and mobile communication, among others.

There are about 44 signatories for government permits before a developer can build. This could be an obstacle course for corruption. Bureaucracy and red tape in securing building permits do not only pain the developer but are also hazardous to the end-users. Quality is sacrificed to offset the cost paid for corruption. Ultimately, corruption kills. It will take visionary leadership and a strong political will from the government to ensure public safety through good planning, good design, and good governance.

This story was originally published by The Manila Times, Philippines

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Washington Rules Change, Againhttp://www.ipsnews.net/2017/02/washington-rules-change-again/?utm_source=rss&utm_medium=rss&utm_campaign=washington-rules-change-again http://www.ipsnews.net/2017/02/washington-rules-change-again/#comments Thu, 16 Feb 2017 13:33:45 +0000 Jomo Kwame Sundaram http://www.ipsnews.net/?p=148980 Jomo Kwame Sundaram, a former economics professor, was United Nations Assistant Secretary-General for Economic Development, and received the Wassily Leontief Prize for Advancing the Frontiers of Economic Thought in 2007. ]]> South-south cooperation represents a progressive alternative to the Washington Consensus. Credit: IPS

South-south cooperation represents a progressive alternative to the Washington Consensus. Credit: IPS

By Jomo Kwame Sundaram
KUALA LAMPUR, Feb 16 2017 (IPS)

Over the last four decades, the Washington Consensus, promoting economic liberalization, globalization and privatization, reversed four decades of an earlier period of active state intervention to accelerate and stabilize more inclusive economic growth, associated with Franklin Delano Roosevelt and John Maynard Keynes.

The Golden Age
The US Wall Street Crash of 1929 led to the Great Depression, which in turn engendered two important policy responses in 1933 with lasting consequences for generations to come: US President Roosevelt’s New Deal and the 1933 Glass-Steagal Act.

While massive spending following American entry into the Second World War was clearly decisive in ending the Depression and for the wartime boom, the New Deal clearly showed the way forward and suggested what could be achieved if more public money had been deployed consistently to revive economic growth.

Michal Kalecki and Keynes provided robust analytical justification for counter-cyclical fiscal and other policies to maintain aggregate demand, very much contravening earlier received wisdom. Post-war decolonization gave birth to the academic field of development economics from the 1950s, initially pioneered by Central Europeans striving not to be left behind by the earlier ascendance of Western Europe and then the United States of America after its Civil War.

For about a quarter of a century after the end of the Second World War, the post-war ‘Golden Age’ saw rapid post-war reconstruction in Western Europe. This was crucially supported by the generous Marshall Plan, arguably the first, largest and most successful development cooperation program, triggered by the beginning of the Cold War. Similar economic development policies and assistance were introduced in Japan, Taiwan and South Korea, following the Korean War and the establishment of the People’s Republic of China.

US Secretary of State General George Marshall understood that inclusive economic development would help ensure a cordon sanitaire against the Soviet-led camp. Thus, thanks to the Cold War, Western Europe and Northeast Asia recovered quickly, industrialized rapidly and achieved sustained, rapid growth with interventionist policies which would be widely condemned by today’s conventional wisdom. While national economic capacities and capabilities had to be nurtured to ensure sustainable development, Marshall also recognized that aid should be truly developmental, not piecemeal or palliative.

Washington Consensus

The ‘Washington Consensus’ – uniting the American government and the Bretton Woods institutions located in the US capital city – emerged from the early 1980s to prescribe neo-liberal economic policies for developing countries for the ‘counter-revolutions’ against development economics, Keynesian economics and progressive state interventions.

Macroeconomic policies became narrowly focused on balancing annual budgets and attaining predictably low inflation – instead of the earlier post-colonial emphasis on achieving and sustaining rapid growth and full employment without runaway inflation. A ‘neo-liberal’ wave of deregulation, privatization and economic globalization followed, supposedly to boost economic growth. Economic growth was expected to trickle down to reduce poverty, with broader sustainable development and inequality concerns consigned to the garbage bin.

But the Washington Consensus policies not only failed to sustain economic growth, largely due to the greater instability and volatility associated with financial liberalization, especially across borders. But premature trade liberalization also undermined existing production and export capacities and capabilities without enabling the development of new ones. For the poorest countries, the loss of tariff revenue also undermined government revenues, expenditure and hence, the capacity to provide badly needed infrastructure, social protection and support for developmental initiatives.

Globalization’s Contradictory Discontents
Instead, those developing countries which achieved rapid growth and structural transformation were typically those which defied conventional wisdom by adopting pragmatic ‘heterodox’ developmental economic policies appropriate to their respective circumstances. Meanwhile, financial and other economic crises of various types became more frequent and disruptive, undermining sustained growth.

In the meantime, the more liberal developed economies experienced spurts of rapid growth as well as greater volatility and instability while most developed economies became more vulnerable to institutional stasis as they abandoned Keynesian policies for neo-liberal policies demanded by markets and their champions.

With European social democrats turning their backs on Keynes in favour of neoliberal economics, and often barely distinguishable from the centre-right in this regard, dissent against economic liberalization and its discontents moved to the ‘extremes’. With the left often on the backfoot in most developed economies for more than a quarter century, it has been the right which has successfully mobilized against cultural ‘others’ often divided among themselves.

While the rhetoric of the national chauvinist ‘new right’ rejects globalization and multiculturalism, it also rejects international solidarity, cooperation and multilateralism. Its rejection of the neoliberal Washington Consensus does not imply opposition to contemporary imperialism, but rather threatens a return to old — and new — forms of domination, economic and otherwise.

More than ever, it will be crucial for developing countries to work together, not only to ensure that South-South and ‘triangular’ (with the North) cooperation represents a progressive alternative to the Washington Consensus and its national chauvinist successors. Such solidarity will determine how well the South — and the world as a whole — will fare during the coming eclipse.

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Energy Access Builds Inclusive Economies and Resilient Communitieshttp://www.ipsnews.net/2017/02/energy-access-builds-inclusive-economies-and-resilient-communities/?utm_source=rss&utm_medium=rss&utm_campaign=energy-access-builds-inclusive-economies-and-resilient-communities http://www.ipsnews.net/2017/02/energy-access-builds-inclusive-economies-and-resilient-communities/#comments Thu, 16 Feb 2017 11:34:56 +0000 Manipadma Jena http://www.ipsnews.net/?p=148974 More girls in rural Bihar, India are going to school after mini-grid-powered household lights give mothers and children two extra hours of evening work and study time. Credit: Manipadma Jena/IPS

More girls in rural Bihar, India are going to school after mini-grid-powered household lights give mothers and children two extra hours of evening work and study time. Credit: Manipadma Jena/IPS

By Manipadma Jena
NEW DELHI, Feb 16 2017 (IPS)

Jaipal Hembrum runs three one-man home enterprises – a bicycle repair shop, a tiny food stall and a tailoring unit in Kautuka, a remote village in eastern India. Sewing recycled clothes into mattresses late into the evening, the 38-year-old father of three girls says two light bulbs fed by a solar power system have changed his life.

Given the trajectory of development India is currently pursuing, energy access for its rural population could bring dramatic economic improvement. Yet 237 million people — a fifth of its 1.3 billion people, many of them in remote villages with few livelihood options — do not have any access to it.The challenge India faces is how to meet its energy requirements while also meeting its emission reduction commitment to the global climate deal.

The Delhi-based research organisation Centre for Science and Environment (CSE) stipulates that if even half of households deemed electrified through the national power grid are not receiving the guaranteed six hours uninterrupted supply, the number of people who are electricity-poor in India totals 650 million.

In this scenario, renewable energy-based mini-grids, particularly in remote villages, are considered the best option to manage local household and commercial energy demand efficiently by generating power at the source of consumption.

This is being proven true by the Rockefeller Foundation’s Smart Power for Rural Development (SPRD) initiative in two of India’s poorest states, Bihar and Uttar Pradesh, where 16 and 36 percent of households respectively are electrified. In India, 55 percent rural households have energy access, often of unreliable quality.

Started in 2014, the SPRD project has helped set up close to 100 mini-grid plants, covering the states of Uttar Pradesh, Bihar and lately, in Jharkhand too. According to Rockefeller Foundation sources, these plants are serving a customer base of around 38,000 people. Over 6,500 households are benefitting, along with 3,800 shops and businesses, and over 120 institutions, telecom towers and micro-enterprises.

Over 2014 – 2017, the Rockefeller Foundation aims to make a difference to 1,000 energy-poor villages in India, benefitting around a million rural people. For this effort, the Foundation has committed 75 million dollars, partnering and funding Smart Power India (SPI) a new entity designed to work closely with a wide range of stakeholders who help scale-up the market for off-grid energy.

Jaipal Hembrum stitches old clothes mattresses in the evening by the light of a solar-powered bulb. The 50 dollars a day he earns is kept aside for schooling and marriages of his three daughters. Credit: Manipadma Jena/IPS

Jaipal Hembrum stitches old clothes mattresses in the evening by the light of a solar-powered bulb. The 50 dollars a day he earns is kept aside for schooling and marriages of his three daughters. Credit: Manipadma Jena/IPS

What can mini-grids can do? Plenty

A recent evaluation of the mini-grids’ impact on communities they serve in Bihar and Uttar Pradesh already show a broad range of economic, social and environmental benefits.

Entrepreneurship and new businesses have grown, with 70 percent existing micro-businesses reporting increased number of costumers after connecting to the mini-grids and 80 percent planned to expand.

Nine in 10 household users said their children’s daily study time has increased by two hours since they got the lights. Women said they had increased mobility after dark and theft cases had fallen. Use of kerosene and diesel has fallen dramatically — to virtually zero, according to Khanna.

Micro-businesses like cyber cafes, fuel stations, mobile and fan repair shops, banks, schools and hospitals are the fastest growing commercial customer section of mini-grids constructed under Smart Power India.

In Shivpura village of Uttar Pradesh, where TARA Urja, a small energy service company (ESCO), started providing reliable electricity from a 30-KW solar plant, Sandeep Jaiswal set up a water purification processor in 2015. In just over a month he was rushing 1,200 litres of water on his new mini-truck to 40 customers. TARA, also a social business incubator, has financially supported Jaiswal with 530 dollars, in return for a one-year contract to source electricity from TARA.

Smart Power India supports the development of rural micro-enterprises through loans, community engagement and partnerships with larger companies with rural value chains, for instance, city malls that source vegetables from rural farms.

India confronts a demographic youth ‘bulge’ with 64 percent in the working age group in 2020, requiring 10 million new jobs every year in the coming decade. Using green mini-grids to create rural livelihoods can also reduce urban migration.

Innovating a business model that propels construction of mini-grids

Mini-grids are a decentralized system providing a renewable energy-based electricity generator with a capacity of 10 kilowatts or more, with a target consumer group it supplies through a stand-alone distribution network.

The sustainability of private companies in the rural power supply sector depends on generating sufficient revenue long-term. To make it profitable for smaller-scale ESCOs to bring electricity to rural parts of the developing world, the Smart Power model ensures fast-growing sectors with significant energy needs such as telecom towers in rural areas, to provide steady revenue. In return, the ESCOs provide contractual guarantee of reliable power supply to the towers.

“There is an opportunity to catalyze the telecommunication and off-grid energy sectors. Currently cell phone towers in rural areas are often powered by expensive diesel generators and companies are looking for cheaper alternatives, thereby creating the possibility for a strong anchor,” says Ashvin Dayal, Managing Director, Asia, of the Rockefeller Foundation.

Telecom towers — by becoming the ‘anchor’ customers – help make ESCOs bankable. They then can expand supply into rural household lighting and local enterprises.

Government figures say 2 billion litres of diesel is annually consumed by the 350,000  existing telecom towers in India, including those in remote rural regions. The challenge India faces is how to meet its energy requirements without compromising environmental sustainability, while meeting its emission reduction commitment to the global climate deal.

Solar power cost per unit has fallen in India to 0.045 cents, which makes it increasingly feasible to shift to renewable powered mini-grids, saving substantial subsidies spent on fossil fuels. The government in 2016 decided to construct 10,000 mini-grids in the next five years of 500 megawatt (MW) capacity, but this is clearly not enough, say experts.

India has a potential for 748,990 MW of solar power. Fourteen states, including Bihar and Uttar Pradesh, receive irradiance above the annual global average of 5 kilowatt-hours per square meter per day.

Around the world, approximately 1.3 billion people lack access to reliable and affordable means of electricity without which, growing their incomes, improving food security and health, educating children, accessing key information services becomes a major challenge. Energy access is critical to achieving several UN Sustainable Development Goals by 2030.

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Corruption Brings Down an Empire: Odebrecht in Brazilhttp://www.ipsnews.net/2017/02/corruption-brings-down-an-empire-odebrecht-in-brazil/?utm_source=rss&utm_medium=rss&utm_campaign=corruption-brings-down-an-empire-odebrecht-in-brazil http://www.ipsnews.net/2017/02/corruption-brings-down-an-empire-odebrecht-in-brazil/#comments Thu, 16 Feb 2017 00:29:24 +0000 Mario Osava http://www.ipsnews.net/?p=148966 The American Airlines Arena, a stadium and entertainment complex in Miami, Florida, is one of the many projects carried out by Odebrecht in the United States, where prosecutors have begun to produce figures reflecting the scope of the company’s corruption. Credit: Odebrecht

The American Airlines Arena, a stadium and entertainment complex in Miami, Florida, is one of the many projects carried out by Odebrecht in the United States, where prosecutors have begun to produce figures reflecting the scope of the company’s corruption. Credit: Odebrecht

By Mario Osava
RIO DE JANEIRO, Feb 16 2017 (IPS)

People in Brazil have been overwhelmed by the flood of news stories about the huge web of corruption woven by the country’s biggest construction company, Odebrecht, which is active in dozens of fields and countries.

The business empire built by three generations of the Odebrecht family is falling apart after three years of investigation by the Lava Jato (car wash) operation launched by the Federal Public Prosecutor’s office in Brazil, which is investigating the corruption that diverted millions of dollars in bribes in exchange for major public works contracts from the state-run oil giant Petrobras.The business group had created a specialised bribe department. According to U.S. justice authorities, every dollar “invested” in bribes produced 12 dollars in contracts.

Marcelo Odebrecht, who headed the company from 2008 to 2015, was arrested in June 2015 and was initially sentenced to 19 years in prison.

In October he and the company reached plea bargain deals to cooperate with the investigation. A total of 77 former and present Odebrecht executives provided over 900 sworn statements to Lava Jato prosecutors, causing a political earthquake in Brazil and throughout Latin America.

In December, the U.S. Justice Department revealed that Odebrecht allegedly spent 1.04 billion dollars in bribes to politicians and government officials in ten Latin American and two African countries, including Brazil, which accounted for 57.7 per cent of the total.

The United States is carrying out its own investigation, which could end in criminal convictions, since several Odebrecht subsidiaries, such as the petrochemical company Braskem, operate there, and their shares are traded on the New York Stock Exchange.

That is also happening in the case of Petrobras, implicated in the corruption scandal and under investigation at the initiative of shareholders in the U.S.

The U.S. and Switzerland, where banks were allegedly used to funnel bribes or launder money, signed cooperation agreements with legal authorities in Brazil, as part of the ongoing offensive against corruption in Latin America’s giant.

The impacts are overwhelming. In Brazil, the revelations about Odebrecht are expected to provoke a tsunami in the political system. Two hundred parliamentarians and government officials may have received bribes, including senior members of the current administration and legislature.

The business group had created a specialised bribe department. According to U.S. justice authorities, every dollar “invested” in bribes produced 12 dollars in contracts.

That estimate is based on more than 100 projects carried out or in progress in Argentina, Brazil, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Panama, Peru and Venezuela, plus Angola and Mozambique in Africa.

Part of the Caracas valley seen from the San Agustín Metrocable, one of the many works assigned to Odebrecht in Venezuela during the government of Hugo Chávez (1999-2013), when the Brazilian company became the biggest construction firm in the country. Credit: Raúl Límaco/IPS

Part of the Caracas valley seen from the San Agustín Metrocable, one of the many works assigned to Odebrecht in Venezuela during the government of Hugo Chávez (1999-2013), when the Brazilian company became the biggest construction firm in the country. Credit: Raúl Límaco/IPS

The arrest warrant issued by a court in Peru against former Peruvian president Alejandro Toledo (2001-2006), who has been living in the United States, and allegations implicating current Colombian President Juan Manuel Santos and Panamanian President Juan Carlos Varela, are just the tip of the iceberg.

What was revealed by Odebrecht executives and former executives, as well as former directors of different departments, such as external affairs, infrastructure, industrial engineering or logistics, has not yet been made public.

New figures involving alleged bribes are expected to come out over the next few months, added to those already disclosed in the United States, including 599 million dollars distributed in Brazil, 98 million in Venezuela, 92 million in the Dominican Republic, 59 million in Panama and 50 million in Angola.

In Peru the total revealed so far is “only” 29 million dollars since 2005. The sum is small, considering that for the Southern Peru pipeline – still under construction – alone, the projected investments amount to seven billion dollars. The Peruvian government has decided to terminate the contract with Odebrecht for the project.

Besides Odebrecht, the Inter-Oceanic Highway, which runs across southern Peru from the Brazilian border to Pacific Ocean ports, is being built by three other Brazilian construction firms – Camargo Correa, Andrade Gutierrez and Queiroz Galvão – which are also under investigation for suspicion of corruption.

During the presidency of Alan Garcia (2006-2011), Peru and Brazil signed an agreement for the construction of five large hydropower plants in Peru, which was cancelled by his successor, Ollanta Humala (2011-2016), who, however, is suspected of receiving three million dollars from Brazil for his election campaign.

Odebrecht, which has a concession to manage Chaglla, the third biggest hydroelectric plant in Peru, with a capacity of 462 MW, was to be the main construction company in charge of building the new plants.

The growing wave of local and industry scandals sheds light on the reach of Odrebrecht’s tentacles. Braskem is accused of distributing 250 million dollars in bribes to sustain its leadership position in the Americas in the production of thermoplastic resins, with 36 plants spread across Brazil, Mexico, the United States, as well as Germany.

The empire, born in 1944 as a simple construction company, started diversifying in the last half century into activities as diverse as the sugarcane business, the development of military technologies or oil services, logistics or shipbuilding companies.

In the early 1970s the group built the Petrobras headquarters in Rio de Janeiro, sealing a connection that led to the current disaster which destroyed the reputation of the company that was so proud of its “Entrepreneurial Technology”, a set of ethical and operational business principles to which its fast expansion was attributed.

But Odebrecht’s success could actually be attributed to a strategic vision and a modus operandi that proved successful until the Lava Jato operation. Part of its methods included being “friends with the king”.

Angola is the best example. The current chairman of the company’s board of directors, Emilio Odebrecht, son of founder Norberto Odebrecht, meets every year with Angolan President José Eduardo dos Santos in Luanda, to discuss projects for the country.

Officially, what they do is assess the projects carried out by the company and define new goals.

The explanation given for the special treatment received by Odebrecht is that it has such a strong presence in vital infrastructure works in the country in areas such as reconstruction, energy, water, highways and urbanisation.

Odebrecht has great prestige in Angola, since it built the Capanda hydroelectric plant on the Kwanza River between 1984 and 2007, facing delays and risks due to the 1975-2002 civil war. Now it is building the biggest plant in Angola, Lauca, also on the Kwanza River, with a capacity to produce 2,067 MW.

The conglomerate is ubiquitous in the country, managing the Belas Mall – an upscale shopping centre in the south of Luanda, Angola’s capital – implementing the water plan to supply the capital, developing the first part of the industrial district in the outskirts of Luanda, building housing developments and playing a key role in saving the national sugarcane industry.

In Cuba it also led the strategic project of expanding the Mariel Port and managing a sugar plant, to help boost the recovery of this ailing sector of the Caribbean nation’s economy.

In other countries, such as Panama, Peru and Venezuela, the number of works and projects in the hands of the Brazilian conglomerate is impressive, in fields as diverse as urban transport, roads and bridges, ports, power plants, fossil fuels, and even agriculture.

But that cycle of expansion came to an end. Heavily indebted, with a plummeting turnover and no access to loans, not even from Brazilian development banks, and carrying the stigma of corruption, the conglomerate is trying to cooperate with justice authorities in the involved countries, seeking agreements to allow it to keep operating and eventually recover.

Now it remains to be discovered whether Odebrecht is “too big to go bankrupt,” as was said of some banks at the start of the global crisis that broke out in 2008.

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Fear of Educationhttp://www.ipsnews.net/2017/02/fear-of-education/?utm_source=rss&utm_medium=rss&utm_campaign=fear-of-education http://www.ipsnews.net/2017/02/fear-of-education/#comments Wed, 15 Feb 2017 21:27:52 +0000 Ravale Mohydin http://www.ipsnews.net/?p=148973 By Ravale Mohydin
Feb 15 2017 (Dawn, Pakistan)

There are two prevailing mindsets that could account for the staggered growth of female education in Pakistan: that which thinks of education as an asset, and the other which views it as a threat. The crux of the issue of slow-to-improve gender disparity in our education system is that Pakistanis appear to have both mindsets at the same time.

Ravale Mohydin

Ravale Mohydin

Less than a decade ago, a child’s gender significantly accounted for unequal opportunities in primary education, even more so in the case of secondary education in Pakistan. Today, surveys show more than eight out of 10 Pakistanis say that education is equally important for boys and girls; very few think that it is more important for boys than girls or the other way round.

Still, Pakistan, being a part of the global Education For All (EFA) movement, has not been able to achieve a key measurable education goal: eliminating gender disparity in primary and secondary education no later than 2015.

Female enrolment is up but there can still be socio-cultural hurdles.

This is so despite efforts made by government institutions to improve inclusivity in education, such as the Female Secondary School Stipend Programme initiated in Punjab in 2004, the Stipend Programme for Secondary School Females in Khyber Pakhtunkhwa that was started in 2006, and the 2016 policy to end gender segregation in public schools in Balochistan to allow girls access to higher quality boys’ schools.

These examples were actions relevant to the National Education Policy, and the Education Sector Reforms. They are also aligned with commitments made by the government to EFA goals. A case cannot be made that there is no institutional and reform-based support for facilitating educational access for females.

Though there has been top-down support for equity in education, there is a lack of bottom-up support. This results in a non-holistic approach that has only partially delivered on its promises. This schism is not immediately apparent; one can only start to make sense of it by looking at the following fact: according to a 2015 Asian Development Bank report, female enrolment is up as the net enrolment ratio improved by 16pc in recent years. However, only a quarter of our labour force is female. Compared to the region and the world, Pakistan has a dismal gender gap when it comes to economic participation and opportunity for females.

Even though there may be less resistance to how many girls go to school, there is another kind of resistance related to what girls do after they get educated. This was apparent in the case of focus groups with over 200 parents and teachers of children enrolled in low-cost private schools in rural and urban north Punjab in late 2016. I was directly involved in these discussions as programme manager for the ongoing Learning and Achievement in Pakistan Schools, or LEAPS. The focus groups revealed that many parents viewed girls’ education as a form of protection and expected social and financial clout for their daughters as the natural consequence of educating them.

Surprisingly, most even expected higher returns when it came to investing in a daughter’s education as compared to a son’s education — both in social and financial terms. One got to hear comments such as ‘we should spend more on our daughters as we will get a higher return on our investment. She will go to college and study … she will pass exams. When we spend more on our son, we will spend more but he will fail’. And ‘an educated girl is better able to handle issues with her in-laws’. This is a new (and encouraging) concept.

Yet, these same determined and financially invested parents also agreed with the participating female teachers on girls discontinuing their work after getting married if they could not obtain permission from their in-laws to carry on. Perhaps, in their minds, socio-cultural norms take precedence over the financial and social freedom afforded by girls’ education.

The two mindsets accounting for the staggered growth of education for females are discernible at this point, with one propelling such education forward and the other being more concerned about all this getting out of hand. Pakistanis, it seems, are grappling with how to fuse the two to progress, and also with how to sidestep whatever is deemed inconvenient in socio-cultural terms.

Pakistan’s educated female labour force is slowly growing across socioeconomic groups, and it would be a missed economic opportunity if it is not accompanied by support in the form of socio-cultural acceptance. One can only hope that as we get more educated, the fear of education also becomes a remnant of the past.

The writer works at the Centre for Economic Research in Pakistan. The views expressed are her own.
Published in Dawn, February 15th, 2017

This story was originally published by Dawn, Pakistan

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The High Price of the World Bank’s Blunderhttp://www.ipsnews.net/2017/02/the-high-price-of-the-world-banks-blunder/?utm_source=rss&utm_medium=rss&utm_campaign=the-high-price-of-the-world-banks-blunder http://www.ipsnews.net/2017/02/the-high-price-of-the-world-banks-blunder/#comments Wed, 15 Feb 2017 20:17:58 +0000 Inam Ahmed http://www.ipsnews.net/?p=148971 By Inam Ahmed
Feb 15 2017 (The Daily Star, Bangladesh)

It was the country’s largest infrastructure project – that is up to that point of time in 2011, costing USD 2.9 billion. It was also the World Bank’s largest loan to the tune of USD 1.2 billion. Asian Development Bank, JICA and Islamic Development Bank also joined hands to fund the project that would be so vital for Bangladesh’s development, especially for the 30 million people living in the disadvantaged south for whom the River Padma stood as a solid barrier towards national integration.

world_bank_3__It was a dream about to come true.

And then a bolt from the blue. One fine morning, the World Bank brought the allegation that there had been a ‘corruption conspiracy’ in the bridge project. Suddenly, the bees were buzzing and stinging. The Bank went into hyper gear to take a stern stand against the ‘corruption conspiracy’, and its then country director Ellen Goldstein started shuttling between Dhaka and Washington, firming up the allegation.

Bangladesh reeled under the weight of the blow and the high profile activities that whirled on. But it remained firm in its stand – that there had not been corruption. Team after team from the World Bank came and met the government officials.

After prolonged discussions, the government took steps that the Bank sought to investigate the allegation. Then communication minister Syed Abul Hossain resigned, bridges division secretary Mosharraf Hossain Bhuiyan was sent to jail and PM’s adviser Mashiur Rahman was sidelined, though he held his post. The Anti-Corruption Commission (ACC) embarked on an investigation which yielded no corroboration of the allegations.

And yet, the World Bank dropped the ultimate bombshell in July 2012 when it finally scrapped the project because, in its words, it had “credible evidence corroborated by a variety of sources which points to a high-level corruption conspiracy among Bangladeshi government officials, SNC Lavalin executives and private individuals in connection with the Padma Multipurpose Bridge Project”. It claimed to have gone “the extra mile” when it sent a high-level team to Dhaka to explain the Bank’s position and receive the government’s response.

“The response has been unsatisfactory. The World Bank cannot, should not, and will not turn a blind eye to evidence of corruption,” the Bank concluded while cancelling the project, sinking the hearts of 160 million people, putting this country along with its population to shame before the world.

And what was its evidence of corruption? Was it so compelling that the Bank could not refrain from taking such a harsh decision? Well, now that the Canadian court decision has come on the case, we know the worth of the evidence that the Bank also provided to the Canadian police. The evidence is worth nothing and that is why the Canadian court has thrown the case out.

But what about the price the country paid because of the Bank’s ‘solid evidence’? Its pride lost, albeit momentarily, to the world, cannot be measured. The insult suffered is immeasurable. Thanks to the country’s strong forex reserves and willingness of China to do business, the construction of the bridge is going ahead but at a much higher cost. What could have been accomplished for USD 2.9 billion has now reached USD 3.6 billion. The poor people of Bangladesh will have to pay the almost a billion dollar extra amount just because of the Bank’s ‘evidence’ that did not hold in any court.

Needless to say, another statement by the Bank similar to the one it issued to announce the cancellation of the loan was in order to clarify its position after the Canadian court verdict. An explanation of why those knee jerk reactions that yielded nothing but suffering for a nation was necessary. But it did not come.

It is incredulous that the World Bank, with its expertise on almost anything under the sun, failed to understand through its legal departments that the so-called evidence was all moth-eaten and flimsy. This one single incident will have dented the organisation’s standing in the eyes of the world.

Like it demanded a special inquiry team of the ACC to dig out the so-called ‘corruption’ in the bridge project, the Bank may now appoint its own special inquiry team to dig out what went wrong within and why.

The writer is Deputy Editor, The Daily Star.

This story was originally published by The Daily Star, Bangladesh

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Authorities Urged to Disclose Anti-Money Laundering Effortshttp://www.ipsnews.net/2017/02/authorities-urged-to-disclose-anti-money-laundering-efforts/?utm_source=rss&utm_medium=rss&utm_campaign=authorities-urged-to-disclose-anti-money-laundering-efforts http://www.ipsnews.net/2017/02/authorities-urged-to-disclose-anti-money-laundering-efforts/#comments Wed, 15 Feb 2017 17:34:01 +0000 IPS World Desk http://www.ipsnews.net/?p=148957 Asia Pacific: Fighting corruption is side-lined. The majority of Asia Pacific countries sit in the bottom half of the Corruption Perceptions Index 2016. 19 out of 30 countries in the region scored 40 or less out of 100. Photo: Transparency International.

Asia Pacific: Fighting corruption is side-lined. The majority of Asia Pacific countries sit in the bottom half of the Corruption Perceptions Index 2016. 19 out of 30 countries in the region scored 40 or less out of 100. Photo: Transparency International.

By IPS World Desk
ROME / BERLIN, Feb 15 2017 (IPS)

Bank regulators need to publish much more information about whether banks are doing what’s required by law to stop money laundering, says a major international anti-corruption watchdog.

This would ensure that citizens and businesses can be confident corrupt individuals and organisations, criminals, or terrorists are not using the global banking system, Transparency International (TI) on Feb 15 2017 explained.

A new report from Transparency International shows that in countries hosting the world’s biggest banks, little data on anti-money laundering prevention and enforcement is published, or is if it is published, it is out-of-date.

“Mistrust of banks will continue unless people know they are working on their behalf and not for the corrupt. Corruption and money laundering undermine the basic rule of law, weaken democratic institutions and damage economies and societies,” said José Ugaz, Chair of Transparency International.

“It drives inequality and blocks efforts to stop poverty. We need to see that the people meant to stop corruption in the banking industry are doing their job,” he added.

Transparency International’s study, Top Secret: Countries keep financial crime fighting data to themselves, shows that data about authorities’ anti-money laundering efforts are only partially available across 12 countries, including Germany, Luxembourg, Switzerland, the UK and the US.

This includes data as basic as the number of times banks were sanctioned for money laundering failures in a given country — a number that is only public in four out of the 12 countries assessed: Australia, Cyprus, Italy and the US.

“There is no good reason to keep this data secret. Are they protecting us from the next financial crisis? We, the citizens, have the right to know if the financial sector is being permissive or complicit with illicit activity,” Ugaz noted.

According to Transparency International, in 2013 alone, developing countries lost an estimated 1.1 trillion dollars to illicit financial flows – the illegal movement of money from one country to another. Effective anti-money laundering measures, in both developed and developing countries, are essential to end these illicit flows.

“The public also needs evidence that action is being taken, not only to build trust in the institutions that hold our money, but also as a deterrent against crime by making sure bank examiners are effective.”

Policing the financial sector requires strong, consistent and effective anti-money laundering supervision by authorities, TI underlines, adding: “just like health and safety inspectors in restaurants, national financial supervisors have the power to visit and inspect banks (on-site monitoring), identify and record failings in their systems, and impose sanctions where necessary.”

“Citizens have a right to know the extent to which supervisors are applying this power in practice to uphold the law in the financial sector.”

By increasing media and citizen oversight, making more data about these activities public would help to make anti-money laundering systems more effective.

Transparency International recommends that countries publish anti-money laundering oversight and enforcement statistics on a yearly basis, in a single report or data file. The requirement to publish yearly anti-money laundering data should become a standard recommendation of international bodies, including the Financial Action Task Force (FATF) and the G20.

Transparency on this important aspect of financial market enforcement is only a first, but vital, step on the long road to cleansing the global financial system of dirty money, TI concludes.

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Worst Drought in Decades Drives Food Price Spike in East Africahttp://www.ipsnews.net/2017/02/worst-drought-in-decades-drives-food-price-spike-in-east-africa/?utm_source=rss&utm_medium=rss&utm_campaign=worst-drought-in-decades-drives-food-price-spike-in-east-africa http://www.ipsnews.net/2017/02/worst-drought-in-decades-drives-food-price-spike-in-east-africa/#comments Wed, 15 Feb 2017 15:55:45 +0000 IPS World Desk http://www.ipsnews.net/?p=148953 Farmers in the Horn of Africa need urgent support to recover from consecutive lost harvests and to keep their livestock healthy and productive. Photo: FAO/Simon Maina

Farmers in the Horn of Africa need urgent support to recover from consecutive lost harvests and to keep their livestock healthy and productive. Photo: FAO/Simon Maina

By IPS World Desk
ROME, Feb 15 2017 (IPS)

The most severe drought in decades, which has struck parts of Ethiopia and is exacerbated by a particularly strong El Niño effect, has led to successive failed harvests and widespread livestock deaths in some areas, and humanitarian needs have tripled since the beginning of 2015, the United Nations warns.

East Africa’s ongoing drought has sharply curbed harvests and driven up the prices of cereals and other staple foods to unusually high levels, posing a heavy burden to households and special risks for pastoralists in the region, the United Nations food and agricultural agency on Feb. 14 warned.

“Sharply increasing prices are severely constraining food access for large numbers of households with alarming consequences in terms of food insecurity,” said Mario Zappacosta, a senior economist for the UN Food and Agriculture Organization (FAO).

Local prices of maize, sorghum and other cereals are near or at record levels in swathes of Ethiopia, Kenya, Somalia, South Sudan, Uganda and Tanzania, according to the latest Food Price Monitoring and Analysis Bulletin (FPMA).

Poor livestock body conditions due to pasture and water shortages and forcible culls mean animals command lower prices, leaving pastoralists with even less income to purchase basic foodstuffs, FAO adds, while providing some examples:

Somalia’s maize and sorghum harvests are estimated to be 75 per cent down from their usual level. In Tanzania, maize prices in Arusha, Tanzania, have almost doubled since early 2016.

Drought is pushing up food prices in Uganda. Photo: FAO

Drought is pushing up food prices in Uganda. Photo: FAO


In South Sudan, food prices are now two to four times above their levels of a year earlier, while in Kenya, maize prices are up by around 30 per cent.

Beans now cost 40 per cent more in Kenya than a year earlier, while in Uganda, the prices of beans and cassava flour are both about 25 per cent higher than a year ago in the capital city, Kampala.

Pastoral Areas Face Harsher Conditions

Drought-affected pastoral areas in the region face even harsher conditions, the UN specialised agency reports. In Somalia, goat prices have fallen up to 60 per cent compared to a year ago, while in pastoralist areas of Kenya the prices of goats declined by up to 30 per cent over the last 12 months.

Shortages of pasture and water caused livestock deaths and reduced body mass, prompting herders to sell animals while they can, as is also occurring in drought-wracked southern Ethiopia, FAO reports. This also pushes up the price of milk, which is, for instance, up 40 per cent on the year in Somalia’s Gedo region.

According to the Rome-based agency, Ethiopia is responding to a drought emergency, triggered by one of the strongest El Niño events on record.

Humanitarian needs have tripled since the beginning of 2015 as the drought continues to have devastating effects on the lives and livelihoods of farmers and pastoralists — causing successive crop failures and widespread livestock deaths, it reports.

Food insecurity and malnutrition rates are alarming with some 10.2 million people in need of food assistance.

FAO also reports that one-quarter of all districts in Ethiopia are officially classified as facing a food security and nutrition crisis — 435 000 children are suffering severe acute malnutrition and 1.7 million children, pregnant and lactating women are experiencing moderate acute malnutrition.

Livelihood Crisis

More than 80 per cent of people in Ethiopia rely on agriculture and livestock as their primary source of food and income, however, the frequency of droughts over the years has left many communities particularly vulnerable.

Significant production losses, by up to 50-90 percent in some areas, have severely diminished households’ food security and purchasing power, forcing many to sell their remaining agricultural assets and abandon their livelihoods.

Pastoralists in Ethiopia carry butchered meat home. Photo: FAO

Pastoralists in Ethiopia carry butchered meat home. Photo: FAO


Estimates in early 2016 by Ethiopia’s Bureau of Agriculture indicate that some 7.5 million farmers and herders need immediate agricultural support to produce staple crops like maize, sorghum, teff, wheat, and root crops, and livestock feed to keep their animals healthy and resume production.

Hundreds of thousands of livestock have already died and the animals that remain are becoming weaker and thinner due to poor grazing resources, feed shortages and limited water availability, leading to sharp declines in milk and meat production.

The FAO Ethiopia El Niño Response Plan aims to assist 1.8 million vulnerable pastoralists, agro pastoralists and smallholder farmers in 2016.

To achieve this, the UN food and agriculture will prioritize agricultural production support in order to reduce the food gap, livestock interventions to protect the livelihood assets of pastoralists and agro pastoralists, and activities to enhance the resilience of affected communities through coordinated response.

As part of the emergency response, FAO has been providing planting materials to help seed- and food-insecure households in the worst affected regions plant in the belg and meher seasons.

In an effort to preserve livestock, it has been distributing multi-nutrient blocks in pastoral and agro-pastoral areas to strengthen livestock and bolster the resilience of the cooperatives that produce them.

Survival animal feed is also being provided to help farmers produce fodder and improve access to water for livestock. Herds across the country have also benefited from vaccination and treatment campaigns to address their increasing vulnerability as a result of drought.

In Ethiopia’s Somali Region, FAO is enhancing the financial stability of drought-affected households through the purchase of weak sheep and goats for immediate, local slaughter – and providing the meat – rich in protein – to nutritionally vulnerable drought-affected families.

The intervention will help reduce stress on available feed, enable households to focus their resources on their remaining productive animals, and invest in productive assets.

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Sri Lanka Shines Light on Public Sector Governancehttp://www.ipsnews.net/2017/02/sri-lanka-shines-light-on-public-sector-governance/?utm_source=rss&utm_medium=rss&utm_campaign=sri-lanka-shines-light-on-public-sector-governance http://www.ipsnews.net/2017/02/sri-lanka-shines-light-on-public-sector-governance/#comments Wed, 15 Feb 2017 15:23:31 +0000 Amantha Perera http://www.ipsnews.net/?p=148952 Sri Lanka’s new Right to Information (RTI) Act could open new doors for the country’s media if journalists use it effectively. Credit: Amantha Perera/IPS

Sri Lanka’s new Right to Information (RTI) Act could open new doors for the country’s media if journalists use it effectively. Credit: Amantha Perera/IPS

By Amantha Perera
COLOMBO, Feb 15 2017 (IPS)

Sri Lanka’s long-awaited and much-debated Right to Information (RTI) Act became law this month without much fanfare.

There was no big PR campaign on the part of the government to unveil it on Feb. 3, a day before the island’s 69th Independence celebrations. There was not even a public event, a rarity in this South Asian island, where politicians are prone not to let such opportunities pass by.

Maybe the lack of fanfare was due to a rare understanding of what RTI could do to Sri Lanka’s governing culture – like media minister Gayantha Karunathilake predicted several months ago, the act now places all elected and public officials ‘inside a glass box’ of public scrutiny.

And the requests have flooded in. Taking the lead has been actor turned politician and current deputy minister of social welfare, Rajan Ramanayake. He filed a slew of requests even before the ink dried on the new act.

“This is an act will reveal everything about politicians, without any discrimination on party affiliations,” Ramanayake said.

His RTI requests include details on the number of bar permits, sand mining permits, duty free shop permits, fuel station permits and land permits that have been offered to elected officials from parliamentarians to those at local government bodies. He said he was likely to receive the details by the third week of February.

He has also filed a request for details of all licenses given out by the government to operate TV stations and their conditions.

Most of the first batch of RTI requests have been linked to corruption within public sector, according to RTIWire, a national website that tracks the progress of the act.

“When we asked the public what information they would seek through RTI, almost a third of them referenced some form of corruption by public servants; for example, asset declarations, irregularities in tenders, salaries and perks for ministers,” RTIWire said in profiling the first ten days of the new act.

Citizens in the former conflict zone in the North and East have used the act to seek information on land acquisitions by government departments and on missing loved ones.

Media Minister Karunathilake is candid about the act’s possible ramifications on the government ,which has stepped into the second of a five-year term.

“This will open up the government structure completely for scrutiny. Usually governments will take this kind of decision at the toe end of their terms, but we have not. The act can minimize corruption.”

There has been criticism leveled at the government that the act was aimed at soothing international concerns on rights issues, especially those stemming from the administrations of former president Mahinda Rajapaksa between 2005 to 2015.

The minister denied that there was any connection between the act and the government’s efforts to regain preferential tariff deals for garment exports to the European Union.

“There is no connection at all,” he said. In the next two months the EU is expected to announce whether Sri Lanka will be allowed back in to GSP+ tariff fold that it lost in 2010 due to rights-related concerns.

Opposition parties, however, say that the government is not showing the same enthusiasm it displayed in getting the act finally functioning in making sure the act is implemented efficiently.

“If they are serious, they should begin awareness campaigns without delay,” Opposition MP from the People’s Liberation Front Nalinda Jayatissa said.

To be fair, the government has a Herculean task on its hands in getting RTI information officers into all government agencies, which according to some estimates at the Media Ministry could be in the range of 40,000.

The Ministry has been training officers in the last few months, and while several thousand have taken up posts, many more remain to be filled. The government has not done itself any favours by only allocating a mere Rs 25 m (175,000 dollars) in the current budget for RTI implementation.

Close to two weeks after the act became law, the government was yet to announce the relevant officers in departments, adding confusion and creating unnecessary delays for those submitting requests. B.K.S. Ravindra, the additional secretary at the Media Ministry, said that list would soon be made available online, but did not give a date.

During the first week of the act, there was also confusion about whether police came under the act and who was the relevant officer for each station. Ravindra said that police stations indeed came within the act and that the Assistant Superintendent of Police from each district would serve as the RTI officer.

But according to RTIWire, “the Police are still in the process of appointing Information Officers. This should be complete within the next few weeks. The police force is currently participating in trainings held by the Ministry of Mass Media on Right to Information.”

There is also a dearth of awareness in rural areas on the act and how to file requests, especially in rural areas. In Arananayake, a rural village about 130km from the capital Colombo, which suffered a devastating landslide last year, villagers still living in temporary shelters had absolutely no idea that they could gain information from using the act.

The bigger test for the government will be to make sure that the RTI act does not end up a damp squib.

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Togolese to Lead the Fight against Rural Povertyhttp://www.ipsnews.net/2017/02/togo-to-lead-the-fight-against-rural-poverty/?utm_source=rss&utm_medium=rss&utm_campaign=togo-to-lead-the-fight-against-rural-poverty http://www.ipsnews.net/2017/02/togo-to-lead-the-fight-against-rural-poverty/#comments Wed, 15 Feb 2017 14:04:03 +0000 IPS World Desk http://www.ipsnews.net/?p=148947 Gilbert Fossoun Houngbo, new president of IFAD.

Gilbert Fossoun Houngbo, new president of IFAD.

By IPS World Desk
ROME, Feb 15 2017 (IPS)

Gilbert Fossoun Houngbo, former Prime Minister of Togo, has been appointed as the sixth President of the International Fund for Agricultural Development (IFAD), a specialised UN agency and international financial institution that invests in eradicating rural poverty in developing countries around the world.

“I have come from the rural world. I have first-hand knowledge of the harshness of this kind of life,” said Houngbo, who was appointed by IFAD’s member states at the organisation’s annual Governing Council meeting in Rome.

Houngbo takes up the helm at a time when changing government priorities and the more immediate needs of humanitarian crises – like natural disasters, conflict and refugees – threaten to divert funding away from long-term development.

With growing global demand for food, increased migration to cities and the impact of climate change, investments in agriculture and rural development will be essential to achieve the Sustainable Development Goals of ending poverty and hunger.

“We have to keep our ambition and at the same time be realistic and pragmatic,” he said. “We have to demonstrate that every dollar invested will have the highest value for money.”

Houngbo has more than 30 years of experience in political affairs, international development, diplomacy and financial management.

Since 2013 he has served as Deputy Director General of the International Labour Organisation. Prior to that, he was Assistant Secretary General, Africa Regional Director and Chief of Staff at the United Nations Development Programme.

As someone who was born and raised in rural Togo, Houngbo believes that the inequality in today’s world should never be accepted, and that IFAD has a crucial role to play in bringing opportunities to the poor and excluded.

“The privilege of attaining high-quality education helped me develop a strong sense of responsibility towards improving the condition of those who have not had similar opportunities,” he wrote in answer to questions during the nomination process.

“I believe that through a dynamic leadership of IFAD, I can contribute to visible change in the hardship-laden lives of the world’s rural poor.”
Togo covers 57,000 square kilometres, making it one of the smallest countries in Africa. With a population of around 8 million inhabitants, Subsistence agriculture is the main economic activity in Togo; the majority of the population depends on it. Food and cash crop production employs the majority of the labour force and contributes about 42 per cent to the gross domestic product (GDP).

Coffee and cocoa are traditionally the major cash crops for export, but cotton cultivation increased rapidly in the 1990s, with 173,000 metric tons produced in 1999.

After a disastrous harvest in 2001 (113,000 metric tons), production rebounded to 168,000 metric tons in 2002.
Despite insufficient rainfall in some areas, the Togolese Government has achieved its goal of self-sufficiency in food crops — maize, cassava, yams, sorghum, pearl millet, and groundnut.

Small and medium-sized farms produce most of the food crop; the average farm size is one to three hectares.
In the industrial sector, phosphates are Togo’s most important commodity, and the country has an estimated 60 million metric tons of phosphate reserves.

During the 1990s, Togo suffered through a socio-political crisis, an economic regression and a decrease in public and international aid. As a result, an estimated 62 per cent of the population currently lives below the poverty line.

The country’s challenge now is to create the conditions for economic growth – and the Government of Togo believes that the best way to achieve lasting growth is through increased production and productivity in the agriculture sector.

Houngbo was among eight candidates, including three women, vying for the organisation’s top leadership position. He succeeds Kanayo F. Nwanze, who was President for two terms beginning in April 2009. Houngbo will take office on 1 April 2017.

IFAD invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience, though grants and long-term, law-interest credits.

Since 1978, this UN body — also known as the “bank of the poor” — has provided 18.5 billion dollars in grants and low-interest loans to projects that have reached about 464 million people.

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The Algerian Emir Who Set a Protection of Prisoners Code in 1842http://www.ipsnews.net/2017/02/the-algerian-emir-who-set-a-protection-of-prisoners-code-in-1842/?utm_source=rss&utm_medium=rss&utm_campaign=the-algerian-emir-who-set-a-protection-of-prisoners-code-in-1842 http://www.ipsnews.net/2017/02/the-algerian-emir-who-set-a-protection-of-prisoners-code-in-1842/#comments Wed, 15 Feb 2017 13:17:59 +0000 IPS World Desk http://www.ipsnews.net/?p=148944 Abdelkader saving Christians during the Druze/Christian strife of 1860. Painting by Jean Baptiste Huysmans. Public Domain

Abdelkader saving Christians during the Druze/Christian strife of 1860. Painting by Jean Baptiste Huysmans. Public Domain

By IPS World Desk
ROME / OXFORD, UK, Feb 15 2017 (IPS)

As far back as the 1830s, Algerian Emir Abd el Qader el Jazairy was known for having introduced, among others, rules concerning the humane treatment of prisoners, which developed in 1842 into his Code for the Protection of Prisoners.

“The Emir’s Code prohibited mistreatment of prisoners and the killing of unarmed enemy soldiers or prisoners. In the Emir’s jails, there were no ‘enemy combatants’ prevented from enjoying basic human rights,” explained Idriss Jazairy, the executive director of the Geneva Centre for Human Rights Advancement and Global Dialogue.

“Henri Dunant, the great Swiss humanitarian activist is credited with having introduced the first code to protect war prisoners that led to the creation of the Red Cross. That was in 1863, some twenty years after the adoption of the Emir’s Code,” he added.

The executive director of the Geneva Centre made this statement during an event held on Feb. 15 on the historical importance of the 19th century Algerian leader, Emir Abd el Qader, and the universality of Islamic values, at the renowned Oxford Centre for Islamic Studies of Oxford University.

Jazairy also spoke about the Emir’s contribution to identify commonalities between Islam and Christianity in order to promote peace, social justice and inter-religious harmony between Muslims and Christians.

“He asserted in a letter of July 1862 to a French bishop, Mgr. Pavy, that the teachings of both of these faiths were the same and could be encapsulated in two principles: the worship of God and compassion towards His creatures. Our religions, he averred, only differ in the prescriptions provided as to how best to comply with these cardinal principles.

“This brings the Emir to the conclusion in his book ‘Reminder to the Thoughtful and Notice to the Oblivious’ that religions are complementary and all lead to tolerance,” Jazairy said.

During his presentation, he also referred to the example of the Emir’s action to save the Christian minority in Damascus, during civil strife in 1860 that was widely commended by world leaders at that time.

The Emir’s decision to provide protection to religious minorities reflect the Emir’s dedication to upholding what he called “the rights of humanity” an expression that preceded, and anticipated, the adoption of the Universal Declaration of Human Rights 85 years later.

The executive director of the Geneva Centre also expressed his concerns that the world press, by calling the authors of terrorist action “Jihadis”, unwittingly provide religious legitimacy for their heinous crimes and accredit the idea that Islam inspires terrorism.

He argued that this was tantamount to “Islamising crime rather than denouncing the criminalisation of Islam.”

“This provides terrorist groups with recruitment publicity while stimulating in credulous people’s minds, both in the Middle East and in the West, a conflation of Islam with terrorism,” the executive director of the Geneva Centre warned.

By this standard, the Emir Abd el Qader el Jazairy is very much alive today with city squares and streets across the world bearing his name and with even a city in the U.S. state of Iowa named after him, he explained.

Not a single year has elapsed in recent times without new books and innumerable articles being published about this towering international figure, said Jazairy.

“The Emir was honoured by no lesser world leaders of his time than Abraham Lincoln, Queen Victoria, Tsar Alexander II, Sultan Abdelmajid I and of course Napoleon III. Praised also was he by no lesser writers and poets than Rimbaud and Voltaire, Browning and Thackeray.”

The Emir is known to have fought the French invaders of Algeria for 17 years from 1830 to 1847. He waged 116 battles and confronted, at times defeating them, five princes of the French Royal Household, ten field-marshals and 150 generals, Jazairy reminded.

“Despite the fact that the French army outnumbered 10 to 1 the troops of the Emir, despite the former’s resort to weapons of mass destruction of the times, the almighty mobile cannon, the French conquest was slow, even laborious. Its vagaries called for the replacement of the Minister of War in France 16 times during this period.”

He noted that Algeria has a long history of resisting foreign invasion and occupation. Jugurtha, born in 160 BC, for instance, a courageous leader of Algeria, resisted the Roman invasion for seven years.

“Algeria’s liberation war (1954-1962) also lasted seven years. In December 1847, the fighting officially ended leading to what Algerians refer to as a treaty to end hostilities. The French called it, not ingenuously, a surrender.”

By this treaty the French committed inter alia to the transfer of the Emir, his family and followers to Alexandria or Acre. However, the treaty was shamefully violated by France, Jazairy noted.

The Geneva Centre for Human Rights Advancement and Global Dialogue is a think-thank dedicated to the promotion of human rights through cross-cultural, political, religious and civilizational dialogue, and through training of the upcoming generations of stakeholders in the Arab region.

The Centre works towards a value-driven human rights system, challenging politicisation and building bridges between different narratives thereon of the Global North and of the Global South.

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St Valentine’s Day: Celebrating Healthy Relationships; Challenging Violencehttp://www.ipsnews.net/2017/02/st-valentines-day-celebrating-healthy-relationships-challenging-violence/?utm_source=rss&utm_medium=rss&utm_campaign=st-valentines-day-celebrating-healthy-relationships-challenging-violence http://www.ipsnews.net/2017/02/st-valentines-day-celebrating-healthy-relationships-challenging-violence/#comments Tue, 14 Feb 2017 12:57:48 +0000 Bethan Cansfield and Lourdes Montero http://www.ipsnews.net/?p=148940 Bethan Cansfield, Head of Enough Campaign, (Oxfam International) & Lourdes Montero, Gender Justice Manager, Oxfam Bolivia]]> Richly embroidered cloth hearts at Heartworks, Cape Town. /Stephanie Nieuwoudt/IPS

Richly embroidered cloth hearts at Heartworks, Cape Town. /Stephanie Nieuwoudt/IPS

By Bethan Cansfield and Lourdes Montero
LA PAZ, Bolivia, Feb 14 2017 (IPS)

Today, many couples, in many countries will be celebrating Saint Valentine’s Day – or ‘El día de los enamorados’ (‘Day of Lovers’) in some Latin American countries.

Whilst a chance to celebrate the spectrum of healthy loving relationships; it is also an important opportunity to highlight a crisis affecting women and girls in every corner of the world – 30% of women will experience physical or sexual violence perpetrated by a current or former partner or husband.

This figure of 30% does not take into account coercive control – a pattern of domination through intimidation, isolation, degradation and deprivation, including psychological and economic control. So whilst the figure of 30% is shockingly – we know it is just the tip of the iceberg.

No single factor alone causes partner violence, however evidence shows that one of the strongest factors that predicts this form of abuse is discriminatory shared beliefs (social norms) about what is normal and appropriate in relationships. These can include that a man has a right to assert power over a woman or that a man has a right to discipline women. Societies across the world promote masculine jealously and control as a desirable way to demonstrate love. Films, music, soap operas reinforce these ideas, as can parents and friends.

Unhealthy relationships often start early – with young men and women thinking behaviors such as teasing and name calling are normal parts of relationships. The Government of Australia has just released a powerful advert demonstrating how these early notions of relationships between boys and girls can lead to other more serious forms of violence. In one scene, a young boy slams a door on a young girl, causing her to fall over. “He just did it because he likes you,” the mother explains.

Other identities can intersect with gender to influence what is considered normal and appropriate within a relationship. For instance, in Latin American cultures, ‘concepts of machismo dictate that boys and men should be tough, sexually assertive, and dominating, whereas marianismo stresses that girls and women should be submissive and passive in their relationships with boys and men.’

To address this the Colectivo Rebeldía, Oxfam Bolivia and the Women’s Coordinator are today launching a new campaign ‘ACTÚA, detén la violencia’ to tackle violence in young people’s relationships.

Bolivia has the highest rates of physical violence against women in Latin America and the Carribean – 53.3% of Bolivian women have experienced physical or sexual partner violence and every three days a woman dies because of femicide.

Oxfam Bolivia’s research has found that nearly half of urban youth (men and women) promote sexist beliefs that normalize violence. This includes “the way you dress provokes rape”, “jealousy is part of love” or “if you really love, you forgive violence”. The study also found that 9 out of 10 youths know a friend is suffering from violence from her partner and that the majority state it is better not to intervene – 33% said that if their friend beats their partner, they do not get in because it’s their private life.

Despite this apparent indifference, 43% of young people consider that violence can decrease if the whole society gets involved, 54% believe that the fight against violence is a priority for the development of the country and 85% of young people would be willing to act to stop the violence.

In its first stage, the ACTÚA campaign aims to tackle the indifference of the friend of someone in a violent relationship or perpetrating violence in a relationship. It will develop circles of friends that socially sanction violent behaviors and develop support networks for young women facing violence. Using public and peer pressure, the campaign hopes to decrease violence in young relationships.

Whether in Bolivia or anywhere else in the world, we all need to take a stand against notions of harmful love and instead promote positive and healthy relationships with our family, friends and colleagues.

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No to Palestinian Peace Envoy: US to UNhttp://www.ipsnews.net/2017/02/no-to-palestinian-peace-envoy-us-to-un/?utm_source=rss&utm_medium=rss&utm_campaign=no-to-palestinian-peace-envoy-us-to-un http://www.ipsnews.net/2017/02/no-to-palestinian-peace-envoy-us-to-un/#comments Tue, 14 Feb 2017 01:11:01 +0000 Lyndal Rowlands http://www.ipsnews.net/?p=148937 The flags of UN observer states the Vatican and Palestine. Credit: UN Photo/Cia Pak.

The flags of UN observer states the Vatican and Palestine. Credit: UN Photo/Cia Pak.

By Lyndal Rowlands
UNITED NATIONS, Feb 14 2017 (IPS)

The failed appointment of former Palestinian-Prime Minister Salam Fayyad as the UN’s peace envoy to Libya has shown that divisions over Palestine still run deep at the world body.

UN Secretary-General Antonio Guterres’ pick as his Special Representative in Libya, was quickly vetoed by U.S. Ambassador to the UN Nikki Haley on Friday 10 February.

Haley said on Friday that the United States was “disappointed” to see a letter indicating Fayyad would be appointed for the role.

By Monday Fayyad was no longer under consideration

In Dubai on Monday, Guterres described the turn of events as a “loss for the Libyan peace process,” describing Fayyad as “the right person for the right job at the right moment.”

Guterres also noted the importance of appointment given the ongoing instability in Libya.

“Let’s not forget that Libya is not only relevant in itself, Libya has been a factor of contamination to the peace and stability in a wide area, namely in Africa, in the Sahel, and to bring an end to the conflict in Libya is in everybody’s interest.”

However few if any conflicts have remained on the UN’s agenda as long as the Israeli-Palestinian conflict.

Indications that the Palestinian question – as it is referred to in UN Security Council meetings – may become a source of tension between the United Nations and the Trump – Republican administration began before Trump had taken office.

On December 22, the United States under then President Barack Obama allowed Security Council Resolution 2334 condemning Israeli settlements to pass by abstaining – the resolution was supported by the 14 other Security Council members, including U.S. allies such as New Zealand, the United Kingdom and France.

The resolution stated that “Israel’s establishment of settlements in Palestinian territory occupied since 1967, including East Jerusalem, had no legal validity.”

In an apparent break from protocol for a President-elect, Donald Trump appeared to respond to the vote on December 23 with a Tweet stating: “As to the U.N., things will be different after Jan. 20th.”.

Haley later described the resolution as “a terrible mistake,” in her confirmation hearing for the role of U.S. Ambassador to the UN.

Following the vote Israel passed a law on 6 February retrospectively recognising Jewish Settelements built on confiscated Palestinian land in the occupied territories.

Kofi Annan, Chair of The Elders and former UN Secretary-General, described the law as “highly damaging” to “prospects for peace.”

“Prime Minister Netanyahu should show leadership to overturn this law, paying heed to the objections of Israel’s Attorney General, broad segments of Israeli society, and members of his own Likud Party,” said Annan.

The United States has remained Israel’s closest ally both for strategic reasons as a partner in the Middle East and due to domestic support for Israel. This support comes in part from America’s Jewish population. While the current administration supports Israel, their support for Judaism is less clear, after the White House failed to refer to Jews or Judaism in its statement issued on Holocaust Remembrance Day.

Meanwhile support for Israel also comes from groups such as Christians United for Israel who say on their website that they have over 3 million members. The group’s website homepage also includes a pop-up campaign calling to defund the United Nations.

The United States provides 22 percent of the UN budget, making it the largest single member state contributor.

There is yet to be any concrete indication from either Trump or Haley that the U.S. intends to reduce U.S. funding to the UN other than through a leaked draft Executive Order published by some media outlets.

However some Republican lawmakers have been more open in their opposition to the UN’s seeming sympathy towards Palestine, presenting a bill, which has not yet passed, to withhold U.S. funding to the UN until Resolution 2334 has been repealed.

Palestine has been a non-member observer state at the UN since 2012. In a symbolic gesture, the UN began flying the Palestinian flag in September 2015, alongside the Holy See – Vatican – which is also an observer state.

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