Inter Press Service » Energy http://www.ipsnews.net News and Views from the Global South Mon, 08 Feb 2016 23:16:47 +0000 en-US hourly 1 http://wordpress.org/?v=4.1.10 Argentina and United Arab Emirates Open New Stage in Bilateral Relationshttp://www.ipsnews.net/2016/02/argentina-and-united-arab-emirates-open-new-stage-in-bilateral-relations/?utm_source=rss&utm_medium=rss&utm_campaign=argentina-and-united-arab-emirates-open-new-stage-in-bilateral-relations http://www.ipsnews.net/2016/02/argentina-and-united-arab-emirates-open-new-stage-in-bilateral-relations/#comments Fri, 05 Feb 2016 23:42:58 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=143816 The foreign minister of the United Arab Emirates, Sheikh Abdullah bin Zayed Al Nahyan, and his host, Argentina’s foreign minister Susana Malcorra, outside the San Martín Palace in Buenos Aires at the start of their meeting on Friday, Feb. 5. Credit: Government of Argentina

The foreign minister of the United Arab Emirates, Sheikh Abdullah bin Zayed Al Nahyan, and his host, Argentina’s foreign minister Susana Malcorra, outside the San Martín Palace in Buenos Aires at the start of their meeting on Friday, Feb. 5. Credit: Government of Argentina

By Fabiana Frayssinet
BUENOS AIRES , Feb 5 2016 (IPS)

With United Arab Emirates’ foreign minister Sheikh Abdullah bin Zayed Al Nahyan’s visit to Argentina, the two countries launched a new stage in bilateral relations, kicked off by high-level meetings and a package of accords.

On Friday, Feb. 5 Al Nahyan and his host, Argentina’s foreign minister Susana Malcorra, signed five agreements on taxation, trade and cooperation in the energy industry, after a meeting with other officials, including this country’s finance minister, Alfonso Prat-Gay.

The meeting in the San Martín Palace, the foreign ministry building, addressed “important” aspects of ties with the Gulf nation made up of seven emirates, an Argentine communiqué stated.

Al Nahyan’s visit took the UAE’s contacts to the highest diplomatic level with the new Argentine government of Mauricio Macri, who received the minister Friday in Olivos, his official residence, less than two months after being sworn in as president on Dec. 10.

After the meeting in the foreign ministry, the Emirati minister also met with Argentine Vice President Gabriela Michetti, and visited the Senate.

The day before, Al Nahyan was named guest of honour in Buenos Aires by the city’s mayor, Horacio Rodríguez Larreta, with whom he met after the ceremony.

In the meeting between Al Nahyan and Malcorra, a tax information exchange agreement was signed, along with an accord between the Argentine Industrial Union and the UAE Federation of Chambers of Commerce aimed at “establishing a joint business council.”

The foreign ministers of Argentina, Susana Malcorra, and the United Arab Emirates, Sheikh Abdullah bin Zayed Al Nahyan, exchange tax agreements signed during their meeting in Buenos Aires on Friday Feb. 5. Credit: Government of Argentina

The foreign ministers of Argentina, Susana Malcorra, and the United Arab Emirates, Sheikh Abdullah bin Zayed Al Nahyan, exchange tax agreements signed during their meeting in Buenos Aires on Friday Feb. 5. Credit: Government of Argentina

The governor of the southern Argentine province of Neuquén, Omar Gutiérrez, was also present at the meeting, where an agreement was reached to grant a loan to that region to finance the Nahueve hydroelectric project through the Abu Dhabi Fund for Development (ADFD), in the town of Villa del Nahueve.

A four-MW hydroelectric plant will be built in that town of 25,000 people in southern Argentina with an investment of 18 million dollars, through a soft loan, the secretary-general of the Argentine-Arab Chamber of Commerce, Walid al Kaddour, told IPS.

According to the Chamber, trade between the two countries stood at 228 million dollars in 2014, with Argentina exporting nearly 198 million dollars in mainly foodstuffs and steel pipe and tube products.

As Al Kaddour underlined, “there is a great deal of room to grow (in bilateral ties), especially taking into account that the United Arab Emirates is located at a strategic point linking the West with the East.”

He explained that products can be re-exported to all of Asia from the Emirati city of Dubai, because “it is a very important distribution hub.”

The population of the UAE is just barely over nine million, “but it can reach a market of 1.6 billion inhabitants, and it has major logistics infrastructure enabling it to re-export products,” he said.

Al Kaddour said the UAE’s chief interest is importing food, “which is what Argentina mainly produces,” although he said the Gulf nation could also buy raw materials as well as manufactured goods.

The UAE at one point imported up to 1,000 vehicles a year from Argentina, he pointed out.

According to Al Kaddour, another aim of the Emirati minister’s visit was “to meet Argentina’s new administration.”

Macri, of the centre-right “Cambiemos” alliance, succeeded Cristina Fernández of the centre-left Front for Victory, who had strengthened ties with the UAE during an official visit to Abu Dhabi in 2013, where an agreement on cooperation in nuclear energy for peaceful purposes was signed.

“The UAE has pinned strong hopes on the new administration in Argentina,” said Al Kaddour. “The last few years have also been positive in terms of building a friendlier relationship.

“The idea now is to move towards concrete things, such as investment projects in different areas, like renewable energy and agriculture,” he added.

In an article sent to the Argentine daily Clarín, Al Nhayan stressed that “the ties of friendship between Argentina and the United Arab Emirates are strong” and the two countries “are united by shared economic interests.”

He added that “we hope to be able to work with the president, and we believe that together we can bring many benefits to our two countries and our people.”

He also emphasised that his country is seen as “the future gateway for access to Argentine products to the Middle East.”

Emirati sources told IPS that the UAE minister and the Buenos Aires mayor discussed questions such as sustainable urban development and solar energy – an area in which the Gulf nation is interested in cooperating with Argentina.

Although it is a leading oil producer, the UAE is considered a pioneer in the development of unconventional renewable energies, which it is fomenting as the foundation of clean development that will curb climate change.

In Argentina, Al Nahyan kicked off his Latin America tour that will take him to Colombia, Panama and Costa Rica through Feb. 12.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Europe is disintegrating while its citizens watch indifferenthttp://www.ipsnews.net/2016/02/europe-is-disintegrating-while-its-citizens-watch-indifferent/?utm_source=rss&utm_medium=rss&utm_campaign=europe-is-disintegrating-while-its-citizens-watch-indifferent http://www.ipsnews.net/2016/02/europe-is-disintegrating-while-its-citizens-watch-indifferent/#comments Thu, 04 Feb 2016 12:53:07 +0000 Roberto Savio http://www.ipsnews.net/?p=143786

Roberto Savio, IPS news agency founder and president emeritus and publisher of Other News

By Roberto Savio
Rome, Feb 4 2016 (IPS)

We are witnessing the slow agony of the dream of European integration, disintegrating without a single demonstration occuring anywhere, among its 500 millions of citizens. It is clear that European institutions are in an existential crisis but the debate is only at intergovernmental level.

Roberto Savio

Roberto Savio

This proves clearly that European citizens do not feel close to Brussels. Gone are the 1950s, when young people mobilized in the Youth Federalist Movement, with activists from the Federal Movement led by Altiero Spinelli, and the massive campaign for a Europe that would transcend national boundaries, a rallying theme of the intellectuals of the time.

It has been a crescendo of crisis. First came the North-South divide, with a North that did not want to rescue the South, and made austerity a monolithic taboo, with Germany as its inflexible leader. Greece was the chosen place to clash and win, even if its budget was just 4 percent of the whole European Union. The front for fiscal discipline and austerity easily overran those pleading for development and growth as a priority and it alienated many of citizens caught in the fight.

Then come the East-West divide. It become clear that the countries which were under the Soviet Union, joined the EU purely for economic reasons, and did not identify with the so called European values, the basis for the founding treaties. Solidarity was not only ignored, but actively rejected, first with Greece, and now with the refugees. There are now two countries, first Hungary and now Poland, which explicitly reject the “European model and values”, one to defend an autocratic model of governance, and the other Christian values, ignoring any declarations emanating from Brussels.

At the same time, another ominous development emerged. British Prime Minister David Cameron used threats to get special conditions, or in order to leave the EU altogether. At Davos, he explicitly said that Britain was in the EU for the market, but rejects everything else, and especially any possible further integration. German Chancellor Angela Merkel has been sending soothing signs, and all European countries are in the process of trying to recover as much sovereignty as possible. Therefore, whatever Britain may get in the end will serve as a benchmark for everyone else. It is revealing that in Britain, the pro-Europe lobby is run by the financial and economic sector, and there is no citizen’s movement.

All this is happening within a framework of economic stagnation that even unprecedented financial injections from the European Central Bank have not been able to lift.

The list of countries in trouble does not cover only countries from the South. Leaders of fiscal rectitude, like the Netherlands and Finland, are in serious difficulty. The only country which is doing relatively well, Germany, enjoys a positive trade balance with the rest of Europe, has a much lower rate of interest mainly due to its generally better performance; it has been calculated that over half of its positive budget comes from its asymmetric relations with the rest of Europe. Yet, Germany has stubbornly refused to use some of these revenues to create any pact to socialize its assets, like a European Fund to bail out countries, or anything similar. Hardly a shining example of solidarity….as its minister of finance, Wolfgang Schauble, famously said, “we are not going to give the gains that we have sweated for to those who have not worked hard the way we have…”

Finally, the refugee crisis has been the last blow to an institution which was already breathing with great effort. Last year, more than 1,3 million people escaping conflicts in Iraq, Libya and Syria, arrived in Europe. This year, according the High Commissioner for Refugees, at least another million are expected to find their way to Europe.

What has been happening, shows the European reality. The Commission determined that 40.000 people, a mere drop in the ocean, should be relocated from Syria and Ethiopia. This led to a furious process of bargaining, with the Eastern European countries flatly refusing to take part and in spite of threats by the Commission. As of today, the total number of people who have relocated is a mere 201.

Meanwhile Angela Merkel decided to open Germany up to one million refugees, mainly Syrians. But a smart interpretation of the Treaty on Refugees made clear that economic refugees (as well as climate) were excluded, and it was then declared that the Balkans were safe and secure, thereby excluding any Europeans coming to Germany by way of Albania, Kosovo and other countries not yet part of the EU.

It is interesting that, at the same time, Montenegro was invited to join Nato, which, by coincidence also serves to increase the containment of Russia, thanks to a standing army of 3.000. But of course, the flood of people made it difficult to process the paperwork required, and so each country was forced to resort to its own way of doing things, without any relation with Brussels.

Austria declared that it would admit only 37.500 asylum applications.

Denmark, besides creating a campaign to announce to refugees that they were not welcome, passed a law that delays family reunification for three years, and authorises the authorities to seize asylum seekers’ cash and jewels exceeding US$1.400.

Sweden announced that it would give shorter residence permits, and that strict controls will be imposed on trains coming from Denmark.

Finland and Holland have indicated that they will immediately expel all those who do not fit under strict norms as refugees. Great Britain, which was responsible together with the United States for the Iraq invasion (from which ISIS was born) has announced that it will take 27.000 refugees.

There has been a veritable flourishing of wall construction, constructed in Hungary, Slovenia, Slovakia and Austria. Meanwhile Europe tried to buy the Turkish president Recep Tayyip Erdogan, with three billion euros, as a way to stop the flow of refugees but it didn’t work. Now Greece is the culprit, because it was not able to adequately process the nearly 800.000 people who transitted the country.

Austria has asked to exclude Greece from the Schengen agreement, and move European borders “further north” . This chapter is now being concluded by the German initiative to introduce, once again national border controls, for a period of two years. Last year, there were 56 million trucks crossing between countries, and every day 1,7 million people crossed between borders.

To eliminate the Schengen agreement for free movement of Europeans, would be a very powerful signal. But more critically are the imminent political changes which see anti-European and xenophobic parties all riding the wave of fear and insecurity crossing Europe.

In Germany, where Angela Merkel is increasingly losing support, the Party for an Alternative, which has been relatively marginal, could achieve representation in at least three provinces. Across Europe, from France to Italy, from Great Britain to the Netherlands, right wing parties are on the rise.

These parties all use some form of left wing rhetoric: Let us renationalize industries and banks, increase social safety nets, fight against neoliberal globalization…

Hungary has heavily taxed foreign banks to get them to leave, and Poland is using similar language. Their target is very simple: the unemployed, the under employed, retirees, all those with precarious livelihoods, those who feel that they have been left out of the political system and dream of a glorious yesterday. If it is working in the United States with the likes of DonaldTrump, it will work here.

Therefore, there is no doubt that at this moment a referendum for Europe would never pass. Citizens do not feel that this is ‘their’ Europe. This is a serious problem for a democratic Europe.

Will the European Union survive? Probably, but it will be more a kind of common market for finance and business rather than a citizen’s project. It will also hasten the reduction of European power in the world, and the loss of European identity, once the most revolutionary project in modern history.

(End)

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United Arab Emirates Strengthens Ties with Argentina’s New Governmenthttp://www.ipsnews.net/2016/02/united-arab-emirates-strengthens-ties-with-argentinas-new-government/?utm_source=rss&utm_medium=rss&utm_campaign=united-arab-emirates-strengthens-ties-with-argentinas-new-government http://www.ipsnews.net/2016/02/united-arab-emirates-strengthens-ties-with-argentinas-new-government/#comments Mon, 01 Feb 2016 17:20:02 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=143740 The Four Seasons hotel in the upscale Buenos Aires neighbourhood of Recoleta was remodeled this decade with a multi-million dollar investment by the Dubai-based Albwardy Investment Group. This is just one example of investment in Argentina by the United Arab Emirates, which is expected to increase in different sectors as a result of the visit here by the UAE’s foreign minister, Sheikh Abdullah bin Zayed Al Nahyan. Credit: Fabiana Frayssinet/IPS

The Four Seasons hotel in the upscale Buenos Aires neighbourhood of Recoleta was remodeled this decade with a multi-million dollar investment by the Dubai-based Albwardy Investment Group. This is just one example of investment in Argentina by the United Arab Emirates, which is expected to increase in different sectors as a result of the visit here by the UAE’s foreign minister, Sheikh Abdullah bin Zayed Al Nahyan. Credit: Fabiana Frayssinet/IPS

By Fabiana Frayssinet
BUENOS AIRES , Feb 1 2016 (IPS)

The new government of Argentina and the United Arab Emirates (UAE) are strengthening the relationship established by the previous administration, at a time when this South American country is seeking to bring in foreign exchange, build up its international reserves and draw investment, in what the authorities describe as a new era of openness to the world.

Bilateral ties will be boosted during a visit to the Argentine capital by the UAE’s foreign minister, Sheikh Abdullah bin Zayed Al Nahyan, on Feb. 4, the start of his Latin America tour which will also take him to Ecuador, Colombia, Panama and Costa Rica before he flies out of the region on Feb. 12.

After several high-level meetings on Feb. 5, the minister’s visit will end with the signing of five agreements on taxation, sports, cooperation between the state news agencies Telam (Argentina) and WAM (UAE), and an Emirati loan to the southern province of Neuquén.

Mauricio Macri, who was sworn in as president of Argentina on Dec. 10, already indicated his interest in stronger ties when he met on Jan. 20, during the World Economic Forum in Davos, Switzerland, withHamad Shahwan al Dhaheri, executive director of the private equities department of the Abu Dhabi Investment Authority (ADIA).

ADIA, considered the second-largest sovereign wealth fund in the world, manages the excess oil revenues of the UAE, a federation of seven emirates: Abu Dhabi, Ajman, Dubai, Fujairah, Ras al-Khaimah, Sharjah and Umm al-Quwain.

The centre-right Macri, of the Cambiemos coalition, and Al Dhaheri“discussed the prospects opening up for Argentina and were enthusiastic about this new era for the country,” Telam reported from Davos.

The news agency was referring to the end of 12 years of government by the late Néstor Kirchner (2003-2007) and his widow and successor, Cristina Fernández (2007-2015), of the Front for Victory, the Justicialista (Peronist) Party’s centre-left faction, which defines itself as anti-neoliberal.

“Argentina has to position itself as a serious, predictable interlocutor,” this country’s foreign minister, Susana Malcorra, said in Davos.

“The question of economic opening, the search for investment and business opportunities is essential in our agenda,” she stressed.

According to a report from its embassy in Buenos Aires, the UAE has a significant presence in international capital markets through different investment institutions, such as ADIA, Dubai Ports World, Dubai Holding and Abu Dhabi’s International Petroleum Investment Co.

The then president of Argentina, Cristina Fernández, with her host, United Arab Emirates President Khalifa bin Zayed Al Nahyan, at a January 2013 meeting in Abu Dhabi during her official visit to the Gulf nation when bilateral relations were given a major boost. Credit: Government of Argentina

The then president of Argentina, Cristina Fernández, with her host, United Arab Emirates President Khalifa bin Zayed Al Nahyan, at a January 2013 meeting in Abu Dhabi during her official visit to the Gulf nation when bilateral relations were given a major boost. Credit: Government of Argentina

The UAE is a timely interlocutor for Argentina, Luis Mendiola, an expert on the Middle East, the Arab world and Africa with the Argentine Council for Foreign Relations (CARI), underlined in an interview with IPS.

“Their biggest problem is the extraordinary abundance of capital…the question is where to put it to get the best returns on the extraordinary surplus capital they produced during nearly a decade and a half of high oil prices,” added Mendiola, who served as ambassador to Saudi Arabia from 1996 to 2005.

New opportunities

As part of its strategy of strengthening ties with Latin America, the foreign ministry of the United Arab Emirates held a workshop in Abu Dhabi in December with diplomats from Argentina, Colombia, Ecuador and Panama, with the participation of some 70 UAE governmental, semi-governmental and private organisations.

At the workshop, the director of the foreign ministry’s department of economic affairs and international cooperation, Fahad al Tafaq, stressed the UAE’s interest in taking ties with Latin America “to a higher level” in order to serve common interests, WAM, the Emirates news agency, reported from Abu Dhabi.

The participants in the workshop discussed opportunities for investment and strategic alliances in sectors like energy, environment, technology, tourism, agriculture, mining, peaceful uses of nuclear energy, infrastructure and natural resources.

These funds, he said, could go into major infrastructure projects in areas like housing, energy, transport and communications.

In January 2015, the authorities in the southern Argentine province of Neuquén reported that they had secured an 18 million dollar loan from the Abu Dhabi Fund for Development, to finance the Nahueve Hydroelectric Project for the promotion of irrigation in new productive areas, among other aims.

The two countries established diplomatic ties in 1975 and opened embassies in 2008. But relations moved to a new plane when President Fernández visited Abu Dhabi in January 2013, where she met with UAE President Khalifa bin Zayed al Nahyan.

During that visit, cooperation agreements were signed in the area of food, with the opening of the Emirati market to non-traditional Argentine products, and this country opened its first business office in the UAE.

In 2014, as the Argentine-Arab Chamber of Commerce informed IPS, trade between Argentina and the UAE amounted to 228 million dollars, with this South American country enjoying a surplus, exporting 198.9 million dollars in mainly foodstuffs and steel pipe and tube products.

But Mendiola believes there is greater potential to tap because besides boasting one of the highest per capita incomes in the Gulf, the UAE is a business hub which re-exports products to third countries and large markets, such as Saudi Arabia, India, Iran and Pakistan.

Bilateral ties were reinforced in April 2014, with a visit to Argentina by Mohammed bin Rashid Al Maktoum, vice president and prime minister of the UAE and emir of Dubai.

A memorandum of understanding for cooperation in the peaceful use of nuclear energy was signed during that visit.

On that occasion, Fernández emphasised the Argentina forms part of the “exclusive club” of nations “that can produce nuclear energy, but that do so on a non-proliferation basis.”

The then president also referred to the UAE’s “enormous interest” in investing in Argentina and financing projects aimed at bolstering food security.

In November 2015, with support from the local government, five family farming cooperatives from Argentina took part in an international specialty food festival in Dubai.

During the meeting in Buenos Aires, agreements were also reached to promote tourism initiatives and projects in renewable energy – an area in which the UAE, despite its status as one of the world’s largest oil producers, is considered a pioneer among the Gulf countries and even at the international level, Mendiola noted.

“The Emiratis are very good at forging ahead and moving into new areas, and in that sense they are a model, at least in the Gulf region,” he added.

During his visit to Argentina, Al Maktoum remarked that his country did not invest “according to preferences or political motives, but based on economic questions.”

For that reason Mendiola said he was not “surprised” by the UAE’s interest in Latin America “because the Gulf countries in general have always had extremely pragmatic foreign policies which are at the same time modest, in terms of maintaining a low profile.”

“I think the difference now is they are taking advantage of the fact that there is a new government in Argentina, which presents itself to the world as very different from the last one, and that is raising a lot of interest because they have an extraordinary level of reserves as well as investment abroad,” he said.

Mendiola pointed out that the UAE did not have a “clear” presence in Latin America until recently, unlike in Africa and Asia.

“Up to now, South America was a caboose for the Gulf countries, from the point of view of their economic interests. And the change in government without a doubt awakened curiosity and interest in seeing how to best take advantage of these opportunities,” he added.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Core Principals of Climate Finance to Realize the Paris Agreementhttp://www.ipsnews.net/2016/01/core-principals-of-climate-finance-to-realize-the-paris-agreement/?utm_source=rss&utm_medium=rss&utm_campaign=core-principals-of-climate-finance-to-realize-the-paris-agreement http://www.ipsnews.net/2016/01/core-principals-of-climate-finance-to-realize-the-paris-agreement/#comments Fri, 29 Jan 2016 21:42:36 +0000 Stephen Gold http://www.ipsnews.net/?p=143734

Stephen Gold is Global Head - Climate Change, at UNDP Bureau for Policy and Programme Support

By Stephen Gold
UNITED NATIONS, Jan 29 2016 (IPS)

The Paris climate change conference brought together 197 countries and over 150 Heads of State – the largest convening of world leaders in history – to agree on measures and work together to limit the global average temperature rise.

While world leaders and the Agreement they adopted recognize climate change as one of the greatest development challenges of this generation and of generations to come, we are now faced with the next, more difficult step: to raise and wisely spend the money that is needed for us to act.

During my discussions with countries in Paris last month, I listened to concerns expressed by dozens of developing country government representatives about the challenges they face in securing the necessary financing. This is a significant challenge; while countries outlined their Paris Agreement climate targets on mitigation and adaptation via the ‘Intended Nationally Determined Contributions” or “INDCs”, turning these targets into actionable plans requires financing.

To help frame this challenge, three key principles for catalyzing and supporting access to climate finance for sustainable development must be considered.

First, climate finance should be equitable. We must ensure that resources are available to all developing countries who need it. Likewise all segments of the populations, women and men, including from indigenous groups within those countries, should be able to participate and benefit.

Second, it should be efficient, in that public finance must be used to maximize its potential and to bring about far larger sums of finance, particularly in private investment. UNDP helps countries to access, combine and sequence environmental finance to deliver benefits that address the Sustainable Development Goals, including poverty reduction, energy access, food and water security, and increased employment opportunities.

This includes support for diversifying livelihoods through agricultural practices that are more resilient to droughts and floods, improving market access for climate resilient products, disseminating weather and climate information through mobile platforms, and improving access to affordable energy efficient and renewable energy sources.

Third, it should be effective by being transformational and strengthening capacities so that climate and development goals can be achieved in an integrated manner. To make a sufficiently profound impact that moves toward a zero carbon economy, countries know they will need to effectively use the limited public climate finance available in a catalytic manner, so as to secure wider-scale finance from capital markets in a meaningful and sustainable manner. This can include taking significant actions to address existing policy barriers and regulatory constraints to investment that will help create investment opportunities.

UNDP has for example, supported such measures in Uruguay and Cambodia, encouraging affordable wind energy and climate-resilient agricultural practices respectively. This is not to say that institutional investors alone will or should provide a magic bullet for climate-friendly investment. However, there may be opportunities for institutional investors to make climate-smart investment a part of their portfolios while meeting government development objectives somewhere in the middle.

Following these three principles are by no means a guarantee of success, however adhering to them will strengthen our efforts substantially. The evolving climate finance landscape provides new opportunities for countries to strengthen their national systems and incentive mechanisms to attract the needed finance at the international, regional, national and sub-national levels.

Through our collective adherence to the key principles of equity, efficiency and effectiveness, more countries will be more likely to access the finance they need to achieve their development goals, including those outlined in the Paris Agreement.

There is no more critical time than now to act. 2016 is a pivotal year that will set the stage for inter-governmental action on climate change in response to the Paris Agreement, the Sustainable Development Goals and other global agreements for years to come. This is a once-in-a-generation opportunity to transform the sustainable development agenda and to support countries with the resources and tools they need to achieve their goals.

These processes can create the right frameworks to unlock and access scaled-up resources. They also provide a unique opportunity to set new goals and objectives for the global development community, incentivizing innovative approaches, helping to foster gender equality and supporting long-term sustainable development.

Let us ensure we have sufficient resources to undertake the actions needed, and let us make sure we use those resources wisely so that we achieve success.

(End)

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The UAE’s Journey Towards Clean Energyhttp://www.ipsnews.net/2016/01/the-uaes-journey-towards-clean-energy/?utm_source=rss&utm_medium=rss&utm_campaign=the-uaes-journey-towards-clean-energy http://www.ipsnews.net/2016/01/the-uaes-journey-towards-clean-energy/#comments Fri, 29 Jan 2016 12:04:44 +0000 Rajeev Batra http://www.ipsnews.net/?p=143724 Rajeev Batra is partner and head of risk consulting at KPMG.]]>

Rajeev Batra is partner and head of risk consulting at KPMG.

By Rajeev Batra, Special to Gulf News
ABU DHABI, Jan 29 2016 (IPS)

(WAM) - The discovery of hydrocarbon reserves brought tremendous prosperity for the UAE and made it a central player in the global energy market. With one of the highest gross domestic product per capita levels in the world, the UAE has generally used its wealth wisely to stimulate sustainable economic growth. However, volatility in oil markets, growing unrest across the region and the growing threat of climate change has concentrated minds on the need for immediate and decisive action.

Credit: Gulf News archive

Credit: Gulf News archive

The UAE has long recognised that environmental responsibility and economic diversification are essential for a better, more sustainable future. As the first country in the region to set renewable energy targets and as home to the International Renewable Energy Agency (Irena), Masdar City and the Mohammad Bin Rashid Al Maktoum Solar Park, the shift towards cleaner energy sources and reduced carbon emissions is evident.

Ahead of last month’s COP21 summit in Paris, the UAE government pledged to increase clean energy’s share of the national energy mix to 24 per cent by 2021. This is a pivotal step towards making the UAE a global centre of renewable energy innovation. With more than 300 days of abundant sunshine every year, increasing solar’s share of the UAE energy mix should be attainable. Hydrocarbons that are not burnt to generate electricity can be used for other, higher value-adding purposes, or sold to increase the gross national income. Clean energy could also reduce the long-term social costs the government will face as adverse environmental and health effects could be minimised — or even eradicated.

The UAE should be proud of its clean energy leadership role. Abu Dhabi’s renewable energy agency Masdar was a key sponsor of Solar Impulse, the flying laboratory full of clean technologies that represents 12 years of research and development. Solar Impulse generated tremendous global excitement when it attempted the first round-the-world solar flight to demonstrate how a pioneering spirit and clean technologies can change the world.

The Zayed Future Energy Prize — which represents the environmental stewardship vision of the late Shaikh Zayed Bin Sultan Al Nahyan — celebrates impactful, innovative and long-term achievements in renewable energy and sustainability. It reflects the UAE’s commitment to finding solutions that meet the challenges of climate change, energy security and the environment. The 2016 winners were announced on January 19 and ranged from SOS HG Shaikh Secondary School, a school for 300 students three hours from Somaliland’s capital, Hargeisa, to BYD, the largest rechargeable battery supplier and new energy vehicle manufacturer, based in Shenzhen. A lifetime achievement award to Dr Gro Harlem Brundtland recognised her many achievements and accomplishments, included being a guiding force behind the “Brundtland Report” on sustainability over 25 years ago.

The UAE, like many other developed and developing countries, faces a number of clean energy and carbon emission issues. In a reflection of its growing economy, there is an increasing number of vehicles on our roads, leading to increasing fuel usage and higher carbon dioxide, carbon monoxide and nitrous oxide levels. Electricity demand from individuals, industries and commercial buildings — which are major consumers of electricity — is high and the UAE has a significant carbon footprint. Competitively priced oil, gas and energy prices, while driving economic growth in some traditional industries, is undermining renewable energy and stifling growth in what could be a key sector of the country’s future economy.

The recent adoption of the Paris agreement was a historic moment. COP21 was an unprecedented international climate deal and presents both risks and opportunities for businesses who have an important role in terms of emissions reductions and investments to help governments achieve the goals.

As countries start reforming their economies based on their COP21 commitments, we should see the global economy evolving to a lower carbon model. Companies will be required to be more open and transparent about the financial, environmental and social risks and opportunities that they face from climate change.

Investment in clean technology should grow dramatically — governments are expected to double their clean-tech research and development budgets and the private sector is likely to increase its involvement and investment. The role of the private sector, in fact, is key to the sustainability agenda — because of its central role in the development of the global economy. The increase in the private sector’s rate of triple bottom-line reporting — which focuses on social and environmental as well as economic costs and benefits — will be a key marker of the likely success, or failure, of the COP21 programme.

(End)

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Energy from All Sources, a Game of Chance in Brazilhttp://www.ipsnews.net/2016/01/energy-from-all-sources-a-game-of-chance-in-brazil/?utm_source=rss&utm_medium=rss&utm_campaign=energy-from-all-sources-a-game-of-chance-in-brazil http://www.ipsnews.net/2016/01/energy-from-all-sources-a-game-of-chance-in-brazil/#comments Thu, 28 Jan 2016 00:33:40 +0000 Mario Osava http://www.ipsnews.net/?p=143718 An industrial sugar and ethanol plant in Sertãozinho, in the southern Brazilian state of São Paulo. The sugar cane industry in Brazil has shrunk under the government of Dilma Rousseff, due to the gasoline subsidy, which dealt a blow to its competitor, ethanol. Credit: Mario Osava/IPS

An industrial sugar and ethanol plant in Sertãozinho, in the southern Brazilian state of São Paulo. The sugar cane industry in Brazil has shrunk under the government of Dilma Rousseff, due to the gasoline subsidy, which dealt a blow to its competitor, ethanol. Credit: Mario Osava/IPS

By Mario Osava
RIO DE JANEIRO, Jan 28 2016 (IPS)

Brazil, which boasts that it has one of the cleanest energy mixes in the world, is now plagued by corruption, poor market conditions, and bad decisions – a near fatal combination.

Brazil’s energy mix is made up of 42 percent renewable sources, three times the global average.

But the country also hopes to become a major oil exporter, thanks to the 2006 discovery of the “pre-salt” wells – huge reserves of crude under a thick layer of salt far below the surface, 300 km from the coast.

Megaprojects involving the construction of refineries and petrochemical plants, dozens of shipyards that mushroomed up and down the coast, and the dream of turning the new oil wealth into a better future lost their charm in the face of the corruption scandal that broke out in 2014, revealing the embezzlement of billions of dollars from the state oil giant Petrobras.

Nearly 200 people are facing charges in the scandal for paying or receiving kickbacks for inflated contracts. Around 50 of them are politicians, most of them still active members of Congress.

The heads of the country’s biggest construction companies were arrested, which dealt a blow to the real estate market and major infrastructure works nationwide.

The investigations took on momentum when over 30 of those facing prosecution struck plea bargain deals, agreeing to cooperate in exchange for shorter sentences.

The scandal is one of the main elements in the economic and political crisis shaking the country, which saw an estimated drop in GDP of more than three percent in 2015, rising inflation, a dangerously high fiscal deficit, a threat of impeachment hanging over President Dilma Rousseff and chaos in parliament.

Besides the corruption scandal, Petrobras has been hit hard by the collapse of oil prices, which has threatened its investment in the pre-salt reserves, and by the losses it accumulated during years of government fuel-price controls.

The government took advantage of Petrobras’ monopoly on refining to curb inflation by means of price controls, mainly for gasoline.

But the oil company scandal, which broke out after the October 2014 elections in which Rousseff was reelected, fuelled the growth of inflation, to over 10 percent today.

With Petrobras in financial crisis and selling off assets to pay down its debt, none of the four planned refineries has been completed according to plan. The only one that was finished is operating at only half of the planned capacity.

Most of the shipyards, which were to supply the oil drilling rigs, offshore platforms and tankers involved in the production of pre-salt oil, have gone under, and the government’s plans to build a strong naval industry have floundered.

The priority put on oil production, to the detriment of the fight against climate change, along with subsidised gasoline prices dealt a major blow to ethanol, which was enjoying a new boom since the emergence in 2003 of the flexible fuel vehicle, specially designed to run on gasoline or ethanol or a blend of the two.

The innovative new technology revived consumer confidence in ethanol, which had been undermined in the previous decade due to supply shortages. With the flex-fuel cars, consumers no longer had to depend on one kind of fuel and could choose whichever was cheaper at any given time.

The use of ethanol, which is consumed in nearly the same quantities as gasoline in Brazil, broke the monopoly of fossil fuels, making a decisive contribution to the rise in the use of renewable energies.

But gasoline price subsidies drove many ethanol plants into bankruptcy and led to the sale of one-third of the sugarcane industry to foreign investors. Many local companies, facing financial disaster, sold their sugar mills and distilleries to transnational corporations like Bunge, Cargill, Louis Dreyfus and Tereos.

Brazil has practically given up on the idea of creating an international market for ethanol, after initially encouraging consumption and production of the biofuel made from sugarcane. Former president Luiz Inacio Lula da Silva (2003-2010) was very active in this campaign, unlike his successor Rousseff.

Part of what will be the Belo Monte hydroelectric plant’s turbine room in the northern Brazilian state of Pará – a mega-project which is 80 percent complete and is set to be finished in 2019. Credit: Mario Osava/IPS

Part of what will be the Belo Monte hydroelectric plant’s turbine room in the northern Brazilian state of Pará – a mega-project which is 80 percent complete and is set to be finished in 2019. Credit: Mario Osava/IPS

Hydroelectricity

Another decisive factor in achieving a more renewables-heavy energy mix is the predominance of hydroelectricity in the generation of electric power. In recent years, wind power has grown fast, and the use of biomass from sugarcane bagasse has also expanded, although to a lesser extent.

But the construction of giant hydropower dams in the Amazon jungle, such as Belo Monte on the Xingú River, has drawn strong opposition from indigenous communities and environmentalists, which, along with legal action by the public prosecutor’s office, has brought work on Belo Monte to a halt dozens of times.

As a result, work on the dam has been delayed by over a year. One of the latest legal rulings suspended the plant’s operating permit, and could block the filling of the reservoirs, which was to start in March this year.

When the plant comes fully onstream in 2019, Belo Monte will have an installed capacity of 11,233 MW. But during the dry season, when water levels in the river are low, it will generate almost no electric power. The flow of water in the Xingú River varies drastically, and the reservoir will not store up enough water to fuel the turbines during the dry months.

The dam has come under harsh criticism, even from advocates of hydropower, such as physicist José Goldemberg, a world-renowned expert on energy.

The controversy surrounding Belo Monte threatens the government’s plans for the Tapajós River, to the west of the Xingú River – the new hydroelectric frontier in the Amazon. For the last two years, the Rousseff administration has been trying to find investors to build and operate the São Luiz del Tapajós dam, which would generate 8,040 MW of electricity.

The presence of the Munduruku indigenous community along that stretch of the river and in the area of the São Luiz dam has stood in the way of the environmental licensing process.

The diversity of sources in Brazil’s energy mix, lessons learned from earlier negative experiences, and the complexity of the integrated national grid make decisions on energy almost a game of chance in this country.

Hydroelectric dams built in the Amazon rainforest in the 1980s, like Tucuruí and Balbina, caused environmental and social disasters that tarnished the reputation of hydropower. Belo Monte later threw up new hurdles to the development of this source of energy.

Another alternative source, nuclear energy, also brought negative experiences. Completion of the country’s second nuclear plant, still under construction in Angra dos Reis, 170 km from Rio de Janeiro, has long been delayed.

It formed part of a series of eight nuclear power plants that the military decided to build, during the 1964-1985 dictatorship, signing an agreement in 1975 with Germany, which was to provide technology and equipment.

Economic crisis brought the programme to a halt in the 1980s. One of the plants was completed in 2000 and the other is still being built, because the equipment had already been imported over 30 years ago. The final cost overruns will be enormous.

For the government and the different sectors involved in policy-making in the energy industry, giving up hydropower is unthinkable.

But the advances made in wind power, new energy storage technologies, and especially the reduction of costs in the production of solar power increase the risk of making large hydropower dams, which are built to operate for over a hundred years, obsolete.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Hydropower at Front and Centre of Energy Debate in Chile, Once Againhttp://www.ipsnews.net/2016/01/hydropower-at-front-and-centre-of-energy-debate-in-chile-once-again/?utm_source=rss&utm_medium=rss&utm_campaign=hydropower-at-front-and-centre-of-energy-debate-in-chile-once-again http://www.ipsnews.net/2016/01/hydropower-at-front-and-centre-of-energy-debate-in-chile-once-again/#comments Wed, 27 Jan 2016 00:09:26 +0000 Marianela Jarroud http://www.ipsnews.net/?p=143702 General Carrera Lake, the second-largest in South America, in the Aysén region in Chile’s southern Patagonia wilderness, a place of abundant water resources.  Credit: Marianela Jarroud/IPS

General Carrera Lake, the second-largest in South America, in the Aysén region in Chile’s southern Patagonia wilderness, a place of abundant water resources. Credit: Marianela Jarroud/IPS

By Marianela Jarroud
SANTIAGO, Jan 27 2016 (IPS)

The Chilean government’s approval of a hydroelectric dam in the Patagonia wilderness has rekindled the debate on the sustainability and efficiency of large-scale hydropower plants and whether they contribute to building a cleaner energy mix.

“Hydroelectricity can be clean and viable, but we believe every kind of energy should be developed on a human scale, and must be in accordance with the size and potential of local communities,” Claudia Torres, spokeswoman for the Patagonia Without Dams movement, told IPS.

She added that “there are different reasons that socioenvironmental movements like ours are opposed to mega-dams: because of the mega-impacts, and because of the way this energy is used – to meet the needs of the big mining corporations that are causing an environmental catastrophe in the north of the country.”

The movements fighting the construction of large dams in the southern Patagonian region of Aysén suffered a major defeat on Jan. 18, when the plan for the 640 MW Cuervo dam was approved.

This South American nation of 17.6 million people has a total installed capacity of 20,203 MW of electricity. The interconnected Central and Norte Grande power grids account for 78.38 percent and 20.98 percent of the country’s electric power, respectively.

Of Chile’s total energy supply, 58.4 percent is generated by diesel fuel, coal and natural gas. The country is seeking to drastically reduce its dependence on imported fossil fuels, to cut costs and to meet its climate change commitments.

Large-scale hydropower provides 20 percent of the country’s electricity, while 13.5 percent comes from unconventional renewable sources like wind and solar power, mini-dams and biomass.

Chile has enormous potential in unconventional renewable sources. In 2014, the government of Michelle Bachelet adopted a new energy agenda that set a target for 70 percent of Chile’s electric power to come from renewables by 2050.

In terms of water resources, Chile has 6,500 km of coastline, 11,452 square km of lakes, and innumerable rivers.

Aysén, in the extreme south of the country, has abundant water resources – fast-flowing rivers, numerous lakes, and distinctive lagoons. General Carrera Lake, the second-largest in South America after Bolivia’s Titicaca, is found in that region.

To generate hydroelectricity, the authorities and investors have their eyes on the wild rivers of Patagonia, a remote, untamed, unspoiled and sparsely populated wilderness area at the far southern tip of Chile.

But vast segments of civil society reject large hydropower dams, which they consider obsolete and a threat to the environment and to local communities.

However, Professor Matías Peredo, an expert on hydropower at the University of Santiago de Chile, says that thanks to the country’s abundant water resources, hydroelectricity is “one of the energy sources with the greatest potential for development.”

“It’s always good to diversify the energy mix, and well-managed hydroelectricity is quite sustainable,” he told IPS.

The expert argued that a properly managed hydropower dam “is better from an environmental and social point of view than a string of small dams that together provide the same number of MW of electric power.”

Ensuring that a hydroelectricity plant is well-managed means avoiding major fluctuations, Peredo said.

“Hydropower generation in Chile depends on demand and the plant’s load capacity….In other words, the plant can only operate with prior authorisation from the Superintendencia de Electricidad y Combustibles (the country’s power regulator), and depending on the availability of water,” he said.

“This combination means the hydroelectric plant operates on and off, thus generating large fluctuations in flow, which is a major stress for the ecosystem,” he said.

The law to reform the energy industry and foment unconventional renewable sources includes in this category hydropower dams of up to 20 MW – in other words, mini-dams.

Environmental organisations like Ecosistemas maintain that large hydroelectric dams have extremely negative social and environmental impacts.

These include the flooding of large areas of land, which destroys flora and fauna, and the modification of rivers, which causes bioecological damage.

And the negative social impacts of large dams are proportional to the multiple environmental impacts, displacing millions of people: between 40 and 80 million people were forcibly evicted for the construction of large dams worldwide between 1945 and 2000, according to the World Commission on Dams (WCD).

“It is important to diversify the energy mix, for local use, with good support, clean energy sources, and considerably fewer impacts, while strengthening consumption and development in the territories,” said Torres, the Patagonia Without Dams activist, from Coyhaique, the capital of the Aysén region.

“Decentralised power generation is key” to moving forward in terms of clean, sustainable energy, she said, adding that the people of Aysén are seeking to expand the use if wind, solar and tidal power in the region.

Peredo agreed that the decentralisation of power generation is of strategic importance.

“Distributed generation (power generation at the point of consumption) must without a doubt be discussed in this country. It makes a lot of sense for electricity to be produced locally,” he said.

In 2014 the Patagonia Without Dams movement won a major victory when the government cancelled the HidroAysén project, which would have built five large hydropower dams on wilderness rivers in Aysén to generate a combined total of 2,700 MW of energy.

But now the movement was dealt a blow, with the approval by a special Committee of Ministers of the construction of the Cuervo dam – a decision that can only be blocked by a court decision.

The project, developed by Energía Austral, a joint venture between the Swiss firm Glencore and Australia’s Origin Energy, would be built at the headwaters of the Cuervo River, some 45 km from the city of Puerto Aysén, the second-largest city in the region after Coyhaique, for a total investment of 733 million dollars.

Energía Austral is studying the possibility of a submarine power cable and an aerial submarine power line, to connect to the central grids.

The controversy over the plant has heated up because it would be built in the Liquiñe-Ofqui geological fault zone, an area of active volcanoes.

“It poses an imminent risk to the local population,” Torres warned.

Peredo said “the project was poorly designed from the start, and will not be managed well.”

“They failed to take into consideration important aspects, such as the connection of the Yulton and Meullín rivers at some point, which could have disastrous consequences for the ecosystem,” he said.

Opponents of the dam say they will go to the courts and apply social and political pressure, in a year of municipal elections.

“We have one single aim: to keep any dams from being built in Patagonia, and that’s what’s going to happen,” Torres said.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Nevis Has A Date With Geothermal Energyhttp://www.ipsnews.net/2016/01/nevis-has-a-date-with-geothermal-energy/?utm_source=rss&utm_medium=rss&utm_campaign=nevis-has-a-date-with-geothermal-energy http://www.ipsnews.net/2016/01/nevis-has-a-date-with-geothermal-energy/#comments Mon, 25 Jan 2016 12:19:29 +0000 Desmond Brown http://www.ipsnews.net/?p=143687 http://www.ipsnews.net/2016/01/nevis-has-a-date-with-geothermal-energy/feed/ 0 Jamaica’s Climate Change Fight Fuels Investments in Renewableshttp://www.ipsnews.net/2016/01/jamaicas-climate-change-fight-fuels-investments-in-renewables/?utm_source=rss&utm_medium=rss&utm_campaign=jamaicas-climate-change-fight-fuels-investments-in-renewables http://www.ipsnews.net/2016/01/jamaicas-climate-change-fight-fuels-investments-in-renewables/#comments Mon, 18 Jan 2016 15:24:11 +0000 Zadie Neufville http://www.ipsnews.net/?p=143611 http://www.ipsnews.net/2016/01/jamaicas-climate-change-fight-fuels-investments-in-renewables/feed/ 0 Innovative Project to Provide Renewable Energy 24/7 to Chilean Villagehttp://www.ipsnews.net/2016/01/innovative-project-to-provide-renewable-energy-247-in-chilean-village/?utm_source=rss&utm_medium=rss&utm_campaign=innovative-project-to-provide-renewable-energy-247-in-chilean-village http://www.ipsnews.net/2016/01/innovative-project-to-provide-renewable-energy-247-in-chilean-village/#comments Fri, 15 Jan 2016 16:52:55 +0000 Marianela Jarroud http://www.ipsnews.net/?p=143604 The fishing village of Caleta San Marcos in northern Chile, 100 km from Iquique and 1,800 km north of Santiago, will be the site of an innovative project, Espejo de Tarapacá, that will combine renewable sources to provide the local residents with a steady 24/7 energy supply. Courtesy Valhalla Energía

The fishing village of Caleta San Marcos in northern Chile, 100 km from Iquique and 1,800 km north of Santiago, will be the site of an innovative project, Espejo de Tarapacá, that will combine renewable sources to provide the local residents with a steady 24/7 energy supply. Courtesy Valhalla Energía

By Marianela Jarroud
SANTIAGO, Jan 15 2016 (IPS)

A novel energy project in Chile will combine a pumped-storage hydroelectric plant operating on seawater and a solar plant, to provide a steady supply of clean energy to a fishing village in the Atacama Desert, the world’s driest.

The idea may seem unlikely, given the extreme aridity and lack of water in northern Chile, where copper, gold and silver mining corporations use most of the water and energy consumed.

But the initiative has drawn the interest of local and foreign investors. And in 2015 it won the Avonni National Innovation Award granted by the Chilean Innovation Forum, the National TV Station TVN, El Mercurio – the country’s largest newspaper – and the Economy Ministry.

“Nowhere in the world have they managed to offer clean energy 24/7 at competitive prices, without subsidies,” said Juan Andrés Camus, general manager and one of the two founders of Valhalla Energía, the local company that is carrying out the project.

“The convergence of these three elements is unique, and it’s not a stroke of genius on our part but a wonderful gift of nature,” he told IPS.

The company was founded on the premise that Chile is a country that is poor in the “energies of the past, but infinitely rich in energies of the future.”

With an investment of 400 million dollars, the Espejo (Mirror) de Tarapacá will essentially operate as a big battery that will store up energy. Construction is to begin in late 2016 and it is set to come onstream in 2020.

The project includes the installation of a pumped-storage hydroelectric plant, which will pump seawater up a cliff on the coast using solar energy, to a natural storage basin at an altitude of 600 metres.

In the night-time, when no solar energy is available, the plant will generate electricity by releasing the stored water, which will rush down through the same tunnels. This will provide a steady round-the-clock supply of energy – 24 hours a day/seven days a week – overcoming the problem of intermittency of renewable energy sources.

Scale model of Espejo de Tarapacá, a renewable energy project that will take advantage of Chile’s coastal geography, with a cliff where seawater will be pumped up to a natural storage basin at an altitude of 600 metres, in the extreme north of the country. Credit: Courtesy Valhalla Energía

Scale model of Espejo de Tarapacá, a renewable energy project that will take advantage of Chile’s coastal geography, with a cliff where seawater will be pumped up to a natural storage basin at an altitude of 600 metres, in the extreme north of the country. Credit: Courtesy Valhalla Energía

El Espejo will generate 300 MW of electricity in Caleta San Marcos, in the extreme northern region of Tarapacá, 100 km south of the city of Iquique.

At the same time, the company will build Cielos de Tarapacá, a 1,650-hectare solar park in nearby Pintados that will produce 600 MW of energy, with a projected investment of nearly one billion dollars.

The solar project, which is waiting for an environmental permit, will operate with single-axis tracking technology in order to follow the sun during the day from east to west.

Camus said the solar park will be so large that “if it began to operate in 2015 it would be the biggest in the world.”

At night, the plant will continue generating solar power, thanks to the energy stored in Espejo.

The salient aspect of the two projects is that they will harness the natural attributes that Chile has in abundance: seawater, coastal cliffs, and the Atacama Desert’s solar radiation.

This will avoid the need to build dams and reduce construction of underground tunnels by up to 80 percent, according to the promoters of the project, who say it is one of the most innovative renewable energy initiatives in the world.

“More than in the technology employed, the innovation of Espejo de Tarapacá lies in the more efficient use of geography, which makes it possible to build the plant at the lowest possible cost,” said Camus.

“The big opportunity is in the efficient use of the territory, more than in the technological barrier,” he added. Chile is a long, narrow country between the Pacific Ocean to the west and the Andes mountains to the east. It has 6,435 km of coast line.

Valhalla has been working closely with the people of Caleta San Marcos.

The fishing village’s 300 inhabitants, who make a living from small-scale fishing and harvesting shellfish and giant kelp, were initially wary, afraid the initiative would have a negative impact on local marine resources.

Working groups were set up to discuss things with the local community, who asked for advisers with expertise in marine issues and a lawyer to support them in technical and legal aspects.

Finally, after months of work, the company signed agreements with the local fishing union and the residents’ association pledging to make contributions to the local community. They also agreed on a set of principles to guarantee transparent management of the plant, as well as a mechanism to address problems in case damage to the sea is detected.

Aerial view of the area where the Espejo de Tarapacá project will be built, to produce 300 MW of electricity using seawater and solar energy, in an innovative plant that will generate energy 24/7 in the Atacama Desert in northern Chile. Credit: Courtesy of Valhalla Energía

Aerial view of the area where the Espejo de Tarapacá project will be built, to produce 300 MW of electricity using seawater and solar energy, in an innovative plant that will generate energy 24/7 in the Atacama Desert in northern Chile. Credit: Courtesy of Valhalla Energía

“This has been beneficial, and I hope other communities can have access to this and will be able to decide for themselves, but with information, equal opportunity, while defending their rights, so that ignorance doesn’t become a curb on development,” said Genaro Collao, president of the local fishing union of Caleta San Marcos.

“At this tipping point the decision is: I put money in your pocket or I improve your life,” he told IPS by phone from the village. “Money in my pocket is going to last one day, one week, one month. But life is an ongoing legacy, that’s the concept.”

This South American nation of 17.6 million people has a total installed capacity of 20,203 MW of electricity. The interconnected Central and Norte Grande power grids account for 78.38 percent and 20.98 percent of total electric power, respectively.

Of the country’s total energy supply, 58.4 percent is generated by diesel fuel, coal and natural gas, while the rest comes from renewable energy sources – mainly large hydropower dams.

Only 13.5 percent comes from unconventional renewable sources like wind power (4.57 percent), solar (3.79 percent), mini-dams (2.8 percent) and biomass (2.34 percent).

In 2014, the government of Michelle Bachelet adopted a new energy agenda that set a target for 70 percent of Chile’s electric power to come from renewable sources by 2050.

“Seventy percent of the greenhouse gases in Chile come from the energy sector,” Environment Minister Pablo Badenier has told IPS. “That means it is our commitments in energy that will enable us to live up to the pledge to cut emissions by 30 percent by 2030.”

“Looking at the 2050 energy road map, it appears viable that by the year 2050, 70 percent of power generation in Chile could come from renewable sources. That is what makes it possible to seriously commit to this goal regarding greenhouse gases.”

Studies indicate that Atacama has one of the highest concentrations of solar energy in the world. According to experts, the entire country could be supplied with electricity if less than 0.5 percent of the desert’s surface were covered by solar panels.

“Projects like this one could offer an opportunity by putting Chile at the forefront of development of green technology that does not require people to pay more for it,” said Camus.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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TAIWAN: Polls Harken End of Nuclear Powerhttp://www.ipsnews.net/2016/01/taiwan-polls-harken-end-of-nuclear-power/?utm_source=rss&utm_medium=rss&utm_campaign=taiwan-polls-harken-end-of-nuclear-power http://www.ipsnews.net/2016/01/taiwan-polls-harken-end-of-nuclear-power/#comments Wed, 13 Jan 2016 13:51:11 +0000 Dennis Engbarth http://www.ipsnews.net/?p=143575 http://www.ipsnews.net/2016/01/taiwan-polls-harken-end-of-nuclear-power/feed/ 0 Jamaica’s Drought Tool Could Turn the Table on Climate Changehttp://www.ipsnews.net/2016/01/jamaicas-drought-tool-could-turn-the-table-on-climate-change/?utm_source=rss&utm_medium=rss&utm_campaign=jamaicas-drought-tool-could-turn-the-table-on-climate-change http://www.ipsnews.net/2016/01/jamaicas-drought-tool-could-turn-the-table-on-climate-change/#comments Wed, 13 Jan 2016 07:33:35 +0000 Zadie Neufville http://www.ipsnews.net/?p=143566 Drought-map_

By Zadie Neufville
KINGSTON, Jamaica, Jan 13 2016 (IPS)

On a very dry November 2013, Jamaica’s Meteorological Service made its first official drought forecast when the newly developed Climate Predictability Tool (CPT) was used to predict a high probability of below average rainfall in the coming three months.

By February, the agency had officially declared a drought in the eastern and central parishes of the island based on the forecasts. July’s predictions indicated that drought conditions would continue until at least September.

Said to be the island’s worst in 30 years, the 2014 drought saw Jamaica’s eastern parishes averaging rainfall of between 2 and 12 per cent, well below normal levels. Agricultural data for the period shows that production fell by more than 30 per cent over 2013 and estimates are that losses due to crop failures and wild fires amounted to one billion dollars.

Jamaica’s agricultural sector accounts for roughly seven per cent of the island’s gross domestic product (GDP) and employs about 20 per cent of its workforce.

The Met Service’s, Glenroy Brown told IPS, “The CPT was the main tool used by our Minister (of Water, Land, Environment & Climate Change) Robert Pickersgill throughout 2015 to advise the nation on the status of drought across the island .”

It was also used but the National Water Commission (NWC) to guide its implementation of island-wide water restrictions.

A technician with Jamaica’s Met Service, Brown designed and implemented the tool in collaboration with Simon Mason, a climate scientist from Columbia University’s International Research Institute (IRI) for Climate and Society with funding from the United States Agency for International Development (USAID).

“The tool provides a Windows package for constructing a seasonal climate drought forecast model, producing forecasts with updated rainfall and sea surface temperature data,” he explained.

The innovation was one of the first steps in building resilience under Jamaica’s national climate policy. It provides drought-monitoring forecasts that allows farmers to plan their planting around dry periods and has been “tailored for producing seasonal climate forecasts from a general circulation model (GCM), or for producing forecasts using fields of sea-surface temperatures,” Brown said.

The tool combines a number of applications including Google Earth and localised GIS maps, to generate one to five day forecasts that are country and location specific. The information is broken down and further simplified by way of colour-coded information and text messages for the not so tech-savvy user.

The tool designed by Brown and Mason also incorporated IRI’s own CPT (designed by Mason) that was already being used by Caribbean countries with small meteorological services and limited resources, to produce their own up-to-date seasonal climate forecasts. The new tool combined data on recent rainfall and rainfall predictions to provide a forecast that focused specifically on drought.

“It was important for us to design a system that addressed Jamaica’s needs upfront, but that would also be suitable for the rest of the region,” Mason noted.

The scientists explained, “Because impact of a drought is based on the duration of the rainfall” and not only the amount of rainfall, looking forward is not enough to predict droughts because of factors related to accumulation and intensification.

“What we’re doing is essentially putting a standard three-month rainfall forecast in context with recent rainfall measurements,” Mason, told USAID’s publication Frontlines last May. He noted that if below-normal rainfall activity was recorded during an unusually dry period, indications were there was a “fairly serious drought” ahead.

Sheldon Scott from Jamaica’s Rural Agricultural Development Authority (RADA) told IPS that farmers who used the SMS information were able to avoid the worse effects of the drought.

“The impacts were visible in relation to farmers who used the information and others who didn’t, because those who did were able to manage the mitigating factors more effectively,” he said.

During the period, more than 500 farmers received text alerts and about 700,000 bulletins were sent to agricultural extension officers.

Among the farmers who signed up for text messaging service, Melonie Risden told Frontlines, “The information we received from the Met office gave us drought forecasts in terms of probabilities. We still decided to plant because we were fortunate to have access to the river and could fill up water drums ahead of time in anticipation of the drought.”

Risden lost the corn she planted on the 13-acre property in Crooked River, Clarendon, one of the parishes hardest hit by the drought with only two per cent of normal rainfall, but was able to save much of the peas, beans and hot peppers.

Six months after Jamaica’s Met Service made its ground-breaking forecast, the CIMH presented the first region-wide drought outlook at the Caribbean Regional Climate Outlook Forum in Kingston. Now 23 other Caribbean and Central American countries are using the tool to encourage climate change resilience and inform decision-making.

“Regionally the tool is now a standard fixture across several countries within the region, including the Dominican Republic, Cuba and Haiti. This regional effort is coordinated by the CIMH,” Brown said.

Back in Jamaica, the tool is being hailed “a game-changer” in the climate fight by Jeffery Spooner head of the Met Service, who described the CPT as “an extremely important tool in Climate Change forecasting and specifically for the agricultural – including fisheries- and water sectors for rainfall projection .”

The CPT is now also used to provide regular monthly bulletins that are published by the Meteorological Service on their web site www.jamaicaclimate.net. RADA has also continued to use the CPT in its extension service, to enhance the ability of farmers’ and other agricultural interests to improve water harvesting, planting and other activities.

Since most of the island’s small farms depend on rainfall, more farmers – including those with large holdings – are using the information to better manage water use and guide their activities, Scott said.

Local and intentional scientists have linked the extreme atmospheric conditions related to the droughts affecting Jamaica and the region to the persistent high-pressure systems that has prevented the formation of tropical cyclones to global warming and climate change.

Across the agricultural sector, Jamaica continues to feel the impacts of drought and the challenges are expected to increase with the climate change. In a 2013 agricultural sector support analysis, the Inter-American Development Bank estimated, low impact on extreme climate events on Jamaica’s agriculture sector by 2025 could reach 3.4 per cent of “baseline GDP” annually.

In fact, the Intergovernmental Panel on Climate Change Synthesis Report (AR5) pointed to tools like the CPT to mitigate the impacts of climate change. Its importance to Jamaica’s and the region’s food security and water sector cannot be overlooked.

In addition to adaptation for the water sector, the CPT is being modified to provide early warning indicators for wind speeds and coral bleaching among among other applications, said the report.

And as showers of blessings cooled the land and brought much relief in the closing months of the year, CPT shows the drought could well be over.

(End)

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Drought Boosts Science in Dominican Republichttp://www.ipsnews.net/2016/01/drought-boosts-science-in-dominican-republic/?utm_source=rss&utm_medium=rss&utm_campaign=drought-boosts-science-in-dominican-republic http://www.ipsnews.net/2016/01/drought-boosts-science-in-dominican-republic/#comments Mon, 11 Jan 2016 23:01:11 +0000 Ivet Gonzalez http://www.ipsnews.net/?p=143553 Leaks in city water pipes, like this one in the Pequeño Haití (Little Haiti) market in Santo Domingo, aggravated the water shortages during the lengthy drought in the Dominican Republic. Credit: Dionny Matos/IPS

Leaks in city water pipes, like this one in the Pequeño Haití (Little Haiti) market in Santo Domingo, aggravated the water shortages during the lengthy drought in the Dominican Republic. Credit: Dionny Matos/IPS

By Ivet González
SANTO DOMINGO, Jan 11 2016 (IPS)

The recent lengthy drought in the Dominican Republic, which began to ease in late 2015, caused serious losses in agriculture and prompted national water rationing measures and educational campaigns.

But the most severe December-April dry season in the last 20 years helped convince the authorities to listen to the local scientific community in this Caribbean nation that shares the island of Hispaniola with Haiti.

“The National Meteorology Office (ONAMET) actually benefited because the authorities and key sectors like agriculture and water paid more attention to us,” said Juana Sille, an expert on drought, which was a major problem in the Caribbean and Central America in 2015.

The cause was the El Niño-Southern Oscillation (ENSO), a cyclical climate phenomenon that affects weather patterns around the world. Forecasts indicate that its effects will be felt until early spring 2016, and devastating impacts have already been seen in South American countries like Bolivia, Colombia and Peru.

As a result of this record El Niño and its extreme climatic events, the international humanitarian organisation Oxfam predicted in October that at least 10 million of the world’s poorest people would go hungry in 2015 and 2016 due to failing crops.

“The most severe droughts reported in the Dominican Republic are associated with the ENSO phenomenon,” Sille told IPS, based on ONAMET’s studies.

But the meteorologist said that unlike in past years, “there is now awareness among decision-makers about climate change and the tendency towards reduced rainfall.”

The gardens and fruit trees kept by many women in their yards to help feed their families, like this one in the rural settlement of Mata Mamón, were hit hard by drought in the Dominican Republic in 2015. Credit: Dionny Matos/IPS

The gardens and fruit trees kept by many women in their yards to help feed their families, like this one in the rural settlement of Mata Mamón, were hit hard by drought in the Dominican Republic in 2015. Credit: Dionny Matos/IPS

“The authorities are learning to follow the early warning system and to implement prevention and adaptation plans,” she stated.

Sille pointed out that, in an unusual move, a government minister asked ONAMET in 2015 to carry out a study to assess the causes and likely duration of the drought that has been plaguing the country since 2014.

One quarter of the world’s population faces economic water shortage (when a population cannot afford to make use of an adequate water source).

Effects of drought in the Caribbean

• In Cuba, 45 percent of the national territory suffered rainfall shortages, in the most severe dry season in 115 years.
• In Jamaica, people found to be wasting water can be fined or even put into jail for up to 30 days.
• Barbados, Dominica and the Virgin Islands adopted water rationing measures in the residential sector.
• St. Lucia declared a national emergency after several months of water shortages.
• Puerto Rico suffered serious shortages due to poor maintenance of reservoirs.
• Antigua and Barbuda depended on wells and desalination plants to alleviate water shortages.
• In Central America, more than 3.5 million people have been affected by drought.

This is true mainly in the developing South, where the local scientific communities have a hard time raising awareness regarding the management of drought, whose impacts are less obvious than the damage caused by hurricanes and earthquakes.

Experts in the Dominican Republic and other developing countries call for the creation of risk management plans to ward off the consequences of water scarcity crises.

“We have a National Plan Against Desertification and Drought, but some institutions apply it while others don’t,” lamented the meteorologist. “This drought demonstrated the urgent need for everyone to implement the programme, which we have been working on for a long time.”

She said 2015 highlighted the importance of educational campaigns on water rationing measures, drought-resistant crops, more frequent technical advice and orientation for farmers, more wells, and the maintenance of available water sources.

The Dominican Republic’s 10 reservoirs, located in six of the country’s 31 provinces, are insufficient, according to experts. Another one will be created when the Monte Grande dam is completed in the southern province of Barahona.

Along with rivers and other sources, the reservoirs must meet the demands of the country’s 9.3 million people and the local economy, where tourism plays a key role.

Water from the reservoirs is used first for household consumption, then irrigation of crops in the reservoir’s area of influence and the generation of electric power. But every sector was affected by water scarcity in 2015.

“The dry season was really bad. The worst of all, because it killed the crops,” Luisa Echeverry, a 48-year-old homemaker, told IPS. Her backyard garden in the rural settlement of Mata Mamón, in the municipality of Santo Domingo Norte, to the north of the capital, helps feed her family.

But her garden, where she grows beans and corn, as well as peppers and other vegetables, to complement the diet of her three children, was hit hard by the scant rainfall.

“When things were toughest, we would try to manage using our water tank, which we sometimes even used to provide our neighbours with water,” said Echeverry.

“Our concern was for the crops, in our houses we always had water,” said Ocrida de la Rosa, another woman from this rural town of small farmers in the province of Santo Domingo, where many women keep gardens and fruit trees to help feed their families.

All but two of the country’s reservoirs were operating at minimum capacity, which meant the authorities had to give priority to residential users over agriculture and power generation.

Yields went down, and many crops were lost, especially in rice paddies, which require huge quantities of water. Production in the rice-growing region in the northwest of the country fell 80 percent due to the scarce rainfall and the reduced flow in the Yaque del Norte River.

And the Dominican Agribusiness Council reported a 25 to 30 percent drop in dairy production due to the drought, while hundreds of heads of beef cattle died in the south of the country.

Production in the hydropower dams fell 60 percent, in a country where hydroelectricity accounts for 13 percent of the renewable energy supply.

The daily water supply in Greater Santo Domingo went down by 25 percent, and thousands of people in hundreds of neighbourhoods, and in the interior of the country, suffered water rationing measures. Some neighbourhoods depended on tanker trucks for water.

And in the face of rationing measures, residents of Greater Santo Domingo protested the wasteful use of water in less essential activities, as well as the many unrepaired leaks in the residential sector.

The authorities closed down local car wash businesses, which abound in the city, and people could be fined or even arrested for wasting water to wash cars, clean sidewalks and water gardens.

“Integrated water management has advanced in this country,” another ONAMET meteorologist, Bolívar Ledesma, told IPS.

To illustrate, he pointed to the National Water Observatory, which adopts water management decisions together with institutions like the Santo Domingo water and sewage company (CAASD), the National Institute of Potable Water and Sewage (INAP) and the National Water Resources Institute (INDRHI).

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Cash for the Climate Please, Caribbean Leaders Lamenthttp://www.ipsnews.net/2016/01/cash-for-the-climate-please-caribbean-leaders-lament/?utm_source=rss&utm_medium=rss&utm_campaign=cash-for-the-climate-please-caribbean-leaders-lament http://www.ipsnews.net/2016/01/cash-for-the-climate-please-caribbean-leaders-lament/#comments Fri, 08 Jan 2016 15:52:31 +0000 Desmond Brown http://www.ipsnews.net/?p=143544 http://www.ipsnews.net/2016/01/cash-for-the-climate-please-caribbean-leaders-lament/feed/ 4 Water, Water Everywhere but Too Much or Too Littlehttp://www.ipsnews.net/2016/01/water-water-everywhere-but-too-much-or-too-little/?utm_source=rss&utm_medium=rss&utm_campaign=water-water-everywhere-but-too-much-or-too-little http://www.ipsnews.net/2016/01/water-water-everywhere-but-too-much-or-too-little/#comments Fri, 01 Jan 2016 15:43:52 +0000 Francesco Farne http://www.ipsnews.net/?p=143497 Water is at the core of Sustainable Development and it is crucial in Climate Change adaptation and mitigation strategies. Credit: Amantha Perera/IPS

Water is at the core of Sustainable Development and it is crucial in Climate Change adaptation and mitigation strategies. Credit: Amantha Perera/IPS

By Francesco Farnè
ROME, Jan 1 2016 (IPS)

“Water is at the core of the Lima-Paris Action Agenda (LPAA), but it is true that for a long time water and oceans issues have been marginalized in climate conferences, considering that 90 per cent of natural catastrophes are linked to water and 40 per cent of global population will face water scarcity from now to 2050,” stated Marie-Ségolène Royal, French Minister of Ecology, Sustainable Development and Energy, during the press conference at the launch of the #ClimateIsWater initiative at COP21. “It is through water that it is possible to measure climate change impacts,” she said.

On 2 December, “Resilience Day,” the international water community gathered in Paris Le Bourget for the launch of the #ClimateIsWater initiative. A series of events and a press conference took place with the aim of increasing visibility and raising awareness on how water is key to addressing climate change. The initiative brought together several organizations representing civil society and stakeholders.

Sustainable water management is fundamental for addressing climate change. “Actors across all sectors should contribute to climate change adaptation and mitigation strategies integrating water into future climate architecture.” In order to meet this goal, financing is a crucial aspect, declared Torgny Holmgren, of the Stockholm International Water Institute (SIWI), during the press conference.

Water is at the base of all forms of life on earth, and its existence on the planet created the preconditions for the origin of life and the billion years of evolution. Through the history of humanity many civilizations flourished depending on a water source. Mesopotamia, (land between the rivers in ancient Greek), and known as the “cradle of civilization” depended on the Tigris and Euphrates. Ancient Egypt developed on the Nile, the Chinese empire prospered along the Yellow and Yangzi basins and developed a complex administrative machine based on water management for agricultural irrigation.

It is possible to say that human development is water-driven, and this crucial resource is vital to economic and social prosperity. Today in many countries water is a common good, underlining the importance of its universal access. On the other hand, especially in western countries, water is often taken for granted. But without being able to either control its abundance as in floods and bursting sea levels and extreme weather or its scarcity with drought and desertification, water can be catastrophic.

In 2015, the World Economic Forum ranked water as the highest risk affecting global society. According to World Water Council (WWC), one in eight people live without safe drinking water and two people in five do not have adequate sanitation globally. Moreover, nearly 3.5 million deaths from water related diseases are registered every year. Unfortunately, the most affected people live in the global south.

In addition to these shocking facts, directly linked to our so called “water crisis,” there are very strong connections between water and some of the core areas of sustainable development, such as agriculture and food security, demography and urbanization, as well as climate and the environment.

According to the United Nations Food and Agriculture Organization (FAO), agricultural irrigation accounts for 70 per cent of global water withdrawals, an impressive ratio considering demographers’ preoccupations for population growth projections. Indeed, food demand is expected to increase by 60 per cent and energy by 100 per cent by 2050.

Water is inextricably connected to energy. It is necessary not only for hydropower, but also for cooling power plants, for oil and gas hydraulic fracturing or fracking, and for biofuels. Some 1.3 billion people, mainly in Africa, have no access to electricity.

New urban development from 2010-30 is expected to equal what was built in all of human history. This will increase water withdrawals from municipalities, implying issues of access, infrastructure, sanitation and safety from extreme water hazards.

Surprisingly, in spite of all the above evidence, for a long time water has not been at the top of global agenda. It is not highlighted in climate issues, even though “the effects of climate change will be felt mainly in the water cycle, “ said Benedito Braga, President of WWC, during the press conference. Water management has a great potential for both Climate Change adaptation and mitigation, he said.

According to WWC estimates, there have already been 2.5 trillion dollar economic losses from disasters 70 per cent related to floods and droughts so far this century. And other key issues such as migration and infrastructure damage are connected to climate disasters related to water.

Even though water is not specifically mentioned in the final Paris Agreement, it is possible the international water community is gaining momentum. At the seventh World Water Council held in Daegu & Gyeongbuk last April, the Republic of Korea was a notable participant. This council also brought water into the 2030 Agenda for Sustainable Development, the recently adopted Sustainable Development Goals (SDGs) include a goal completely dedicated to water.

SDG 6 aims at ensuring availability and sustainable management of water and sanitation for all. SDG 6 covers the entire water cycle, including the management of water, wastewater and ecosystem resources, and have strong linkages to all of the other SDGs. In fact, its realization would mean a huge step towards the achievement of the 2030 Agenda.

There is further evidence that civil society plays a crucial role in mainstreaming water in the Global Agenda. In fact, the LPAA that brought water at the centre of discussions in Paris, involves national governments, cities, regions and other sub national entities, international organizations, civil society, indigenous peoples, women, youth, academic institutions, as well as businesses. And over 300 organisations signed Paris pact on water and adaptation to climate change in river basins at COP21.

The Eighth Water Council will be held in Brasilia, Brazil in 2018. The fact that a developing country and one of the countries most affected by the water crisis will host the event puts once again the attention on the central role of emerging economies in addressing climate and water issues.

(End)

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American Mining Giant Escaped Indonesian Law with ISDShttp://www.ipsnews.net/2015/12/american-mining-giant-escaped-indonesian-law-with-isds/?utm_source=rss&utm_medium=rss&utm_campaign=american-mining-giant-escaped-indonesian-law-with-isds http://www.ipsnews.net/2015/12/american-mining-giant-escaped-indonesian-law-with-isds/#comments Mon, 28 Dec 2015 13:52:32 +0000 Eve Schram http://www.ipsnews.net/?p=143451

American mining corporation Newmont escaped the domestic processing requirement from Indonesia’s 2009 Mining Law. It achieved this by using a clause in a Dutch investment treaty.

By Eve Schram
JAKARTA, Dec 28 2015 (IPS)

If you want to make your developing country more attractive for foreign investors, try signing bilateral investment treaties (BITs) with rich countries. With these treaties countries promise to look after each others’ investors.

That is the dominant idea in the world. Up until now, that is. More and more countries discover that BITs can be quite risky. Indonesia, for example. Last year it received a so-called ISDS claim from an American mining company, which used the Indonesia-Netherlands investment treaty to get exemptions from certain requirements.

Problem number one

“Our perspective on BITs has changed,” says Abdulkadir Jaelani, director of Economic and Social Affairs of the Indonesian ministry of Foreign Affairs in Jakarta. “It seems very much in favor of the investor. Our number one problem is ISDS.”

ISDS (Investor State Dispute Settlement) is a clause in BITs that enables investors to sue a host country, if it feels it has been treated unfairly. The investor will generally claim financial compensation from the host state. This claim will be judged by a panel of three arbitrators, appointed by the investor and the state. The verdict is binding.

Indonesia received five such claims in recent years. Financial compensation was not always the goal. A claim can be used by an investor to block new legislation.

Indonesia started to terminate BITs last year. The Dutch BIT was one of the first to go.

Newmont

The most recent claim against Indonesia came from the American mining corporation Newmont in the summer of 2014. Newmont has had an active copper mine on the Indonesian island of Sumbawa since 1999. Curiously, financial compensation appears never to have been the goal of Newmont. “I believe Newmont used the arbitration case to enforce an export license,” said Bill Sullivan, legal counsel in Jakarta and expert on the Indonesian mining industry.

In 2009, the Indonesian parliament voted for a new mining law, that served to kickstart the domestic processing industry. Every mining company was told to build a smelter, a plant to process mineral ores. “Indonesia is too dependent on natural resources for its budget,” said Rani Fabrianti, head of legal information at the Mining and Energy Ministry. “The Mining Law enables us to grow into an industrial economy and eventually to a service-oriented economy.”

The Mining Law dictated the mining companies to build a smelter no later than 12 January 2014. After that time, the government would enact an export ban on mineral ores.

On 11 January 2014, certain mining sectors, including the copper sector, were delayed. Copper mining companies would receive an export license for copper concentrate, if they showed progress with the building of smelters. In the meantime, the Indonesian government introduced export tariffs on copper concentrate from 25 per cent in 2014 to 60 per cent in 2017.

The two biggest copper miners in the country, the American corporations Freeport and Newmont, were not amused. Still, Freeport reached a compromise with the government soon after and received its export license. The company pledged over 100 million dollars for the construction of a smelter.

Difficult

The negotiations with Newmont were more difficult. The company said building a smelter would be ‘uneconomic’ and that its mining contract with Indonesia dating from 1986 safeguarded it from such activities.

When its storage facilities reached capacity just before the summer of 2014, Newmont called into force the Force Majeure clause of its contract. It means that the company had to stop production for reasons beyond its power. Force majeure is generally used when the contract area is hit by natural disasters or violent conflict.

80 per cent of the 4000 employees of the Batu Hijau mine on Sumbawa were sent on unpaid leave. After that, Newmont filed for financial compensation from the Indonesian government, through a Dutch business entity, citing the investment treaty between Indonesia and the Netherlands. It was able to do so, because the Dutch government does not require companies to have any economic activity in the Netherlands for using its investment treaties.

But just two short months later, news broke that Newmont and the Indonesian government had reached an agreement. Newmont received its export license and can export for significantly lower tariffs than before: 7.55 in 2015 and 0 per cent in 2017. Newmont in turn pledged 25 million dollars to the smelter that Freeport was set to build and annulled its ISDS claim.

Satisfied

Jaelani says he is satisfied with the compromise. “We negotiated, which we prefer over ISDS”, he says. But many Indonesians think differently. Yani Sagaroa is a mining activist on Sumbawa and is often consulted by the Mining ministry in Jakarta. He blames the government for inconsistency. “Newmont had to build a smelter between 2009 and 2014, but did not. Still they can export copper,” he said. “They did not abide by the law.”

In October 2015, Newmont responded to questions about the smelter by saying it is still negotiating with Freeport.

Meanwhile, Indonesia is writing a new model text for its investment treaties, of which the Dutch journalists have gotten hold. One of the most eye catching changes is that Indonesia will only allow ISDS, if they have provided written consent before each case. This means that companies can never use it as a threat or bargaining tool. Whether western countries are willing to swallow this radical departure from the current practice, remains to be seen.

This article is part of a research by De Groene Amsterdammer, Oneworld and Inter Press Service, supported by the European Journalism Centre (made possible by the Gates Foundation). See www.aboutisds.org.

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French firm attacks Ugandan tax using ISDShttp://www.ipsnews.net/2015/12/french-firm-attacks-ugandan-tax-using-isds/?utm_source=rss&utm_medium=rss&utm_campaign=french-firm-attacks-ugandan-tax-using-isds http://www.ipsnews.net/2015/12/french-firm-attacks-ugandan-tax-using-isds/#comments Fri, 25 Dec 2015 10:04:41 +0000 Edward Ronald Segyawa and Frank Mulder http://www.ipsnews.net/?p=143443 By Edward Ronald Segyawa and Frank Mulder
KAMPALA, Dec 25 2015 (IPS)

The heavily criticized legal mechanism, known as ISDS, is an important tool for European companies to pressurize developing countries. This year Uganda joins the rank of developing nations asking themselves: “Why have we ever signed this?”

Earlier this year, the French oil company Total filed a request for arbitration against the government of Uganda. In essence, arbitration is a way to resolve a dispute, not by going to a public court, but by asking the verdict of a private court. Both parties choose an arbitrator, usually an investment lawyer, and the two of them choose a third one. The arbitration is hosted, in this case, by the World Bank.

This is a new step in the frustrating process of Uganda trying to turn its oil into cash.

Peaceful names

Crude oil reserves in Uganda are estimated by government geologists at 6.5 billion barrels, half of which lies beneath the famous Murchison Falls, a famous national park, known for its wild animals. Wells have been given exotic names, like Crocodile, Buffalo, Giraffe and Warthog.

These peaceful names contrast with the bitter fights that are being fought over the oil. Commercial production has been repeatedly delayed by disputes with explorers over taxes and development plans. Now it’s the French oil company Total refusing to pay tax. It acquired a 33 per cent share in a 2.9 billion dollar project owned by Tullow Oil. According to Ugandan law, when a stock is bought, a stamp duty must be paid.

However, the oil firm refuses to do so, citing no legal obligation to honor the government claims. Total has not disclosed how much tax is at the heart of the dispute or why it objects to the tax levy but a source at the Uganda Revenue Authority told Reuters earlier that the Production Sharing Agreement (PSA) includes a tax waiver.

Secret

From their offices in an eight-story glass building located in the lush green high-end Nakasero area in the capital city Kampala, Total’s Corporate Affairs Manager Ms. Ahlem Friga-Noy stated that “given the applicable confidentiality obligations, we are not in a position to comment further on the proceedings.”

The Office of the Attorney General of the Government of Uganda replies in the same manner: “We are under obligation not to disclose the content of the matter to the public until it is appropriate.”

This points exactly to the problem of arbitration. In a court room all affected parties and stakeholders have the right to speak, or at least listen, but an arbitration procedure is very secretive. No one is obliged to disclose details. Has the state really behaved badly? Or is it the company who abuses arbitration as a pressure to get a tax reduction? The public remains completely in the mist, until the final verdict of the tribunal is published, which can be a multimillion dollar fine.

The Dutch sandwich

The problem Uganda now faces has been made possible by the Bilateral Investment Treaty signed in 2000 with the Netherlands. According to the treaty, all Dutch investors in Uganda have the right to pursue arbitration before the World Bank court if they feel treated unfairly. The French company Total Uganda registered itself as a Dutch company.

This is known as the Dutch Sandwich; you put a Dutch company in between and then you become a Dutch investor. Which turns the treaty into a tool to drag a state before a tribunal of three men in Washington, having a commercial background and the ability to award billion dollar fines, without a possibility to appeal. If Uganda is condemned to a compensation but refuses to pay, the company has the right to seize Ugandan assets in the world.

Against Ugandan law

This is against Ugandan law, says the renowned Human Rights lawyer Isaac Ssemakadde. “According to the constitution, taxation is wholly the creation of the law of the state.” Which means that disputes have to be settled on the basis of the law alone. “Even an agreement between parties cannot supercede the obligation fixed in the law. There is therefore no room for arbitration on taxation,” he said.

“In an earlier tax dispute, between Heritage Oil and Gas against Uganda Revenue Authority, the High Court has forbidden the state to refer proceedings to the arbitration processes in London or anywhere else outside the jurisdiction of the Ugandan courts of law,” noted Ssemakadde.

In short, “Total is being treated differently to other business persons which is in violation of article 21 of the constitution of Uganda which states that all persons are equal before and under the law.”

Nobody can check Total’s claims about a tax waiver, because the Product Sharing Agreements are confidential. This is so despite the fact that Uganda has an Access to Information law that was promulgated in 2005. This limits the discussion, and knowledge, about the proceedings in the country’s oil sector to senior politicians and bureaucrats. The ordinary Ugandan is kept in darkness about what happens there.

The secrecy is not only advantageous for oil companies, but also for certain politicians, who seem to be interested in “personalizing” the oil resources. The Ugandan president Yoweri Museveni recently told Ugandans that those people who are challenging him politically in the forthcoming general elections “are after my oil.”

Why BITs?

A new interactive map made by Dutch journalists, with all known ISDS cases in the world, shows that ISDS is mainly used against developing countries. Sometimes because they clearly behaved badly towards an investor, but in other cases it’s more likely that it is used as a bargaining tool and a threat by multinational companies for better deals. Litigation costs amount to 8 million dollars on average, calculated the Organisation for Economic Co-operation and Development.

For lawyers and arbitrators this is simply an effective tool to defend the rule of law. “I’m happy there is arbitration”, a Dutch investment lawyer says. “There are many thug states in the world. And why do they complain? They signed the treaty themselves.”

“In the end, it’s the ordinary Ugandan taxpayer to bear the brunt and consequences for the enormous amounts of money that is going to be spent on this arbitration process,” says Ssemakadde. “Whereas Total can afford to maintain a given team of lawyers in Washington for, say, a month, Uganda can hardly afford this.”

The people remain ignorant about the deals that are made, and who exercises pressure on whom. Unless the general public starts to view the oil, as well as the treaties their government signs, as belonging to them and not the selected few in government, companies like Total will continue dragging the state into expensive arbitration processes, paid by the Ugandan taxpayers, who are the actual owners of the national resources.

This article is part of a research by De Groene Amsterdammer, Oneworld and Inter Press Service, supported by the European Journalism Centre (made possible by the Gates Foundation). See www.aboutisds.org.

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Mexican Government Ignores Social Impact of Energy Projectshttp://www.ipsnews.net/2015/12/mexican-government-ignores-social-impact-of-energy-projects/?utm_source=rss&utm_medium=rss&utm_campaign=mexican-government-ignores-social-impact-of-energy-projects http://www.ipsnews.net/2015/12/mexican-government-ignores-social-impact-of-energy-projects/#comments Wed, 23 Dec 2015 17:03:38 +0000 Emilio Godoy http://www.ipsnews.net/?p=143430 The oil industry contracts granted by the Mexican government since 2014 have not included the social impact assessments required by law. The photo shows the Abkatun-A Permanente shallow-water platform in the Campeche Sound, where a fire broke out on Apr. 1, 2015 off the coast of the state of Campeche in southeastern Mexico. Credit: Courtesy of PEMEX

The oil industry contracts granted by the Mexican government since 2014 have not included the social impact assessments required by law. The photo shows the Abkatun-A Permanente shallow-water platform in the Campeche Sound, where a fire broke out on Apr. 1, 2015 off the coast of the state of Campeche in southeastern Mexico. Credit: Courtesy of PEMEX

By Emilio Godoy
MEXICO CITY, Dec 23 2015 (IPS)

Mexico’s hydrocarbons law stipulates that oil contracts must include a social impact assessment. But this has not been done in the case of the oilfields granted to the country’s former oil monopoly, Pemex, or to private companies since the industry was opened up to private investment.

Civil society organisations argue that concessions that do include a social impact asessment are illegal.

“The authorities have the obligation to carry out the consultations,” Manuel Llano, the founder of Cartocrítica, a Mexican NGO, told IPS. “One interesting detail is that the law says the evaluation must be conducted prior to the public tenders.”

Article 120 of the hydrocarbons law in effect since August 2014 states that the energy ministry must organise consultations to obtain free, prior and informed consent from indigenous communities that will be affected by oil industry projects in their territories.

And article 121 establishes that those interested in obtaining a permit for oil industry activity must present a social impact assessment (SIA) to the energy ministry. The energy reform opened up oil exploration, extraction, refining, transportation, distribution and sale of oil and its by-products to local and foreign private investment.“With respect to the shallow water projects, the government argues that there is no social impact, which is why the SIAs weren’t conducted. But one of the long-time conflicts is with fisherpersons because of the damage they suffer due to oil industry activity.” -- Aroa de la Fuente

After Pemex’s monopoly was broken up by the new law in August 2014, the state oil company was allowed to keep 83 percent of the country’s probable reserves and 21 percent of the prospective reserves, equivalent to 20 billion barrels of crude. This selection process was known as Round Zero.

On Jul. 15, the Mexican government opened up Round One and assigned two contracts for the exploration and drilling of deep sea oilwells off the coast of the southeastern states of Campeche, Tabasco and Veracruz. The contracts were signed on Sept. 4.

On Sept. 30, the energy ministry assigned three more contracts, and on Dec. 15 the third public tender was held.

“They haven’t done the assessments,” Aroa de la Fuente, a researcher with the FUNDAR Centre for Research and Analysis, told IPS. “With respect to the shallow water projects, the government argues that there is no social impact, which is why the SIAs weren’t conducted. But one of the long-time conflicts is with fisherpersons because of the damage they suffer due to oil industry activity.”

She questioned the argument that there are no social impacts, if no studies have been carried out to demonstrate this.

Since March, the guidelines for the SIAs have been open to public consultation in the Federal Regulatory Improvement Commission (COFEMER).

According to the “general administrative guidelines on social impact assessments in the energy sector”, drawn up by the energy ministry, the evaluations must assess the likely social impacts from oil industry activity and outline the social impact plans and measures to mitigate potentially adverse effects.

The guidelines require a baseline, representing a starting point for companies to compare actual with projected impacts. The baseline should be established before any oil industry activity begins. It should provide statistics in the following areas: demographic, migration, households and families, education, health services, jobs and labour conditions, social security, housing, main economic activities, local public finances, and tangible and intangible cultural heritage.

The company must also include the results from the analysis of stakeholders – individuals, communities, groups, organisations and institutions – taking into consideration their rights, interests and expectations, as well as their levels of involvement, importance and influence regarding the project.

The SIA must specify whether the impacts are short, medium, long-term or permanent; whether the adverse effects are mild, moderate or severe or the benefits are mild or strong; and whether the impacts are low, moderate, high or very high.

The comments about the SIA process reflect the resistance of companies, especially in the storage and distribution sectors, to conduct them.

The energy ministry estimates 176 million dollars in losses from the cancellation of projects due to the lack of SIAs.

The government argues that the first two public tenders did not require SIAs because they involved shallow water drilling. But the law does not make any such distinction.

Llano said SIAs are important for the defence of territory and for those who wish to legally challenge the areas that have been granted in concession.

The position taken by the government “is serious, because many of the wells are on land,” he said. “They are not complying with the law. They say the first two tenders are in offshore areas, which means no assessment is needed, but there is no legal foundation for this argument. What about the issues of the environment and fisherpersons?”

The expert complained that the government assumes that there are no affected groups, “when it is the assessment that must determine this.”

The government has already suffered its first setbacks. On Dec. 11, a federal judge ordered the permanent suspension of the construction of a wind park in the municipality of Juchitán, in the southern state of Oaxaca, after accepting a legal plea for protection filed by Binnizá indigenous communities.

Native groups and NGOs have fought the Energía Eólica del Sur wind park project by the company of the same name, which would generate 396 MW to be fed into power grids in the region. Their argument is that no free, prior and informed consent was sought.

The SIAs can be a useful tool for local populations. “In the public tenders for oil wells on land, the situation will become more complex, because people are going to try to defend themselves, and this is a mechanism that allows them to do so,” said de la Fuente.

Edited by Verónica Firme/Translated by Stephanie Wildes

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Indigenous Villagers Fight “Evil Spirit” of Hydropower Dam in Brazilhttp://www.ipsnews.net/2015/12/indigenous-villagers-fight-evil-spirit-of-hydropower-dam-in-brazil/?utm_source=rss&utm_medium=rss&utm_campaign=indigenous-villagers-fight-evil-spirit-of-hydropower-dam-in-brazil http://www.ipsnews.net/2015/12/indigenous-villagers-fight-evil-spirit-of-hydropower-dam-in-brazil/#comments Mon, 21 Dec 2015 17:28:52 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=143410 Juarez Saw is the chief of the Sawré Muybu village on the Tapajós River between the municipalities of Itaituba and Trairao in the state of Pará, Brazil. Credit: Gonzalo H. Gaudenzi/IPS

Juarez Saw is the chief of the Sawré Muybu village on the Tapajós River between the municipalities of Itaituba and Trairao in the state of Pará, Brazil. Credit: Gonzalo H. Gaudenzi/IPS

By Fabiana Frayssinet
SAWRÉ MUYBU, Brazil , Dec 21 2015 (IPS)

At dusk on the Tapajós River, one of the main tributaries of the Amazon River in northern Brazil, the Mundurukú indigenous people gather to bathe and wash clothes in these waters rich in fish, the staple of their diet. But the “evil spirit”, as they refer in their language to the Sao Luiz Tapajós dam, threatens to leave most of their territory – and their way of life – under water.

“The river is like our mother. She feeds us with her fish. Just as our mothers fed us with their milk, the river also feeds us,” said Delsiano Saw, the teacher in the village of Sawré Muybu, between the municipalities of Itaituba and Trairao in the northern Brazilian state of Pará.

“It will fill up the river, and the animals and the fish will disappear. The plants that the fish eat, the turtles, will also be gone. Everything will vanish when they flood this area because of the hydroelectric dam,” he told IPS.

The dam will flood 330 sq km of land – including the area around this village of 178 people.

According to the government’s plans, the Sao Luiz Tapajós dam will have a potential of 8,040 MW and will be the main dam in a complex of hydropower plants to be built along the Tapajós River and its tributaries by 2024.

But the 7.7 billion-dollar project has been delayed once again because of challenges to the environmental permitting process.

“The accumulative effect is immeasurable. Environmental experts have demonstrated that it will kill the river. No river can survive a complex of seven dams,” Mauricio Torres, a sociologist at the Federal University of Western Pará (UFOPA), told IPS."No river can survive a complex of seven dams.” -- Sociologist Mauricio Torres

The Tapajós River, which flows into the Amazon River, runs 871 km through one of the best-preserved areas in the subtropical rainforest, where the government whittled away at protected areas in order to build the hydroelectric dams, which are prohibited in wildlife reserves.

The area is home to 12,000 members of the Mundurukú indigenous community and 2,500 riverbank dwellers who are opposed to the “megaproject” – a Portuguese term that the native people have incorporated in their language, to use in their frequent protests.

The Mundurukú have historically been a warlike people, and although they have adopted many Brazilian customs in their way of life, they still wear traditional face paint when they go to the big cities to demonstrate against the dam.

Village chief Juarez Saw complains that they were not consulted, as required by International Labour Organisation (ILO) Convention 169 concerning Indigenous and Tribal Peoples in Independent Countries, which has been ratified by Brazil.

The process of legalisation of their indigenous territory has been interrupted by the hydropower project.

“We aren’t leaving this land,” he told IPS. “There is a law that says we can’t be moved unless an illness is killing indigenous people.”

The village is located in a spot that is sacred to the Mundurukú people. And they point out that their ancestors were born here and are buried here.

“This is going to hurt, us, not only the Mundurukú people who have lived along the Tapajós River for so many years, but the jungle, the river. It hurts in our hearts,” said the village’s shaman or traditional healer, Fabiano Karo.

The interview is taking place in the ceremonial hut where the shaman heals “ailments of the body and spirit.” He fears being left without his traditional medicines when the water covers the land around the village – and his healing plants.

Academics warn that the flooding will cause significant losses in plant cover, while generating greenhouse gas emissions due to the decomposition of the trees and plants that are killed.

 A little girl in Sawré Muybu, an indigenous village on the Tapajós River between the municipalities of Itaituba and Trairao in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS


A little girl in Sawré Muybu, an indigenous village on the Tapajós River between the municipalities of Itaituba and Trairao in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS

This biodiversity-rich river basin is home to unique species of plants, birds, fish and mammals, many of which are threatened or endangered.

“The impact will be great, especially on the aquatic fauna, because many Amazon River basin fish migrate from the lower to the upper stretches of the rivers to spawn,” ecologist Ricardo Scuole, at the UFOPA university, explained to IPS.
“Large structures like dikes, dams and artificial barriers generally hinder or entirely block the spawning migration of these species,” he said.

The village of Sawré Muybu currently covers 300 hectares, and the flooding for the hydroelectric dam will reduce it to an island.

María Parawá doesn’t know how old she is, but she does know she has always lived on the river.

“I’m afraid of the flood because I don’t know where I’ll go. I have a lot of sons, daughters and grandchildren to raise and I don’t know how I’ll support them,” Parawá told IPS through an interpreter, because like many women in the village, she does not speak Portuguese.

A few hours from Sawré Muybu is Pimental, a town of around 800 inhabitants on the banks of the Tapajós River, where people depend on agriculture and small-scale fishing for a living.

This region was populated by migrants from the country’s impoverished semiarid Northeast in the late 19th century, at the height of the Amazon rubber boom.

Pimental, many of whose inhabitants were originally from the Northeast, could literally vanish from the map when the reservoir is created.

“With the impact of the dam, our entire history could disappear underwater,” lamented Ailton Nogueira, president of the association of local residents of Pimental.

The consortium that will build the hydroelectric dam, led by the Eletrobrás company, has proposed resettling the local inhabitants 20 km away.

But for people who live along the riverbanks, like the Mundurukú, the river and fishing are their way of life, sociologist Mauricio Torres explained.

“Their traditional knowledge has been built over millennia, passing from generation to generation,” he told IPS. “It is at least 10,000 years old. When a river is dammed and turned into a lake, it is transformed overnight and this traditional knowledge, which was how that region survived, is wiped away.”

The Tapajós River dams are seen by the government as strategic because they will provide energy to west-central Brazil and to the southeast – the richest and most industrialised part of the country.

“The country needs them. Otherwise we are going to have blackouts,” said José de Lima, director de of planning in the municipality of Santarém, Pará.

But the Tapajós Alive Movement (MTV), presided over by Catholic priest Edilberto Sena, questions the need for the dams.

“Why do they need so many hydropower dams on the Tapajós River? That’s the big question, because we don’t need them. It’s the large mining companies that need this energy, it’s the São Paulo and Rio de Janeiro markets that need it,” he told IPS.

It’s evening in Sawré Muybu and the families gather at the “igarapé”, as they call the river. While people bathe, the women wash clothes and household utensils.

From childhood, boys learn to fish, hunt and provide the village with water. For the community, the river is the source of life.

“And no one has the right to change the course of life,” says Karo, the local shaman.

Edited by Verónica Firme/Translated by Stephanie Wildes

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Another Himalayan Blunderhttp://www.ipsnews.net/2015/12/another-himalayan-blunder/?utm_source=rss&utm_medium=rss&utm_campaign=another-himalayan-blunder http://www.ipsnews.net/2015/12/another-himalayan-blunder/#comments Thu, 17 Dec 2015 11:42:36 +0000 N Chandra Mohan http://www.ipsnews.net/?p=143381 By N Chandra Mohan
NEW DELHI, Dec 17 2015 (IPS)

South Asian integration remains a distant dream as some member countries like Nepal resent India’s big brotherly dominance in the region. They perceive that they have no stakes in India’s rise as an economic power. Ensuring unrestricted market access perhaps would have made a big difference in this regard. Their resentment has only deepened as this hasn’t happened. Instead they have registered growing trade deficits with India! The on-going travails of the Himalayan kingdom vis-a-vis India exemplify the problematic nature of integration in a region that accounts for 44 per cent of the world’s poor and one-fourth of its’ population.

N Chandra Mohan

N Chandra Mohan

Nepal appealed to the UN to take “effective steps” to help remove an “economic blockade” imposed on it by India. According to SD Muni, Professor Emeritus at the Jawaharlal Nehru University, this situation is reminiscent of what happened in 1989 when King Birendra’s decision to import anti-aircraft guns from China and his refusal to reform the Panchayat system in the face of a democratic movement precipitated tensions in bilateral relations. India closed down the special entry points for trade and transit, resulting in a severe shortage of essential supplies. Twenty-six years later, Indian trucks have been stopped from entering Nepal.

This blockade similarly has resulted in a shortage of fuel, food and medicines in the Himalayan Kingdom. Supplies of vaccines and antibiotics in particular are believed to be critically low. UNICEF has warned that this will put more than three million infants at risk of death or disease as winter has set in. More than 200,000 families affected by earthquakes earlier in the year are still living in temporary shelters at higher altitudes. The risks of hypothermia, malnutrition and shortages of medicines will disproportionately affect children. As if all this weren’t bad enough, fuel shortages are resulting in illegal felling of forests.

Nepal’s non-inclusive constitution is the proximate cause of this development disaster-in-the-making. The blockade is being spearheaded by ethnic communities who make up 40 per cent of the population like the Madhesis and Tharus from the southern plains or the Terai These minorities have strong historic links with India and are protesting that the recently promulgated constitution marginalizes them. They have stopped goods from India entering the country by trucks since September. India of course formally denies that it has anything to do with the blockade but it is concerned that the constitution discriminates against these minorities.

As Nepal shares a 1,088 mile open border with it, India is concerned that the violent agitation over the constitution will spill over into its country. The bulk of the Himalayan Kingdom’s trade is with India, including a total dependence on fuel. It is also a beneficiary of special trading trade concessions and Indian aid. Nepali soldiers in the Indian army constitute one of its leading infantry formations — the Gurkha Regiment. Nepali nationals freely cross the border and work in India. Normally, such interdependence should occasion closer bilateral ties and integration. Unfortunately, this hasn’t happened till now.

Nepal’s ballooning bilateral trade deficit is of course one factor behind the lingering resentment of India. Realizing this, India’s PM Narendra Modi assured South Asian leaders during a summit meeting in Kathmandu in November 2014 that this trade surplus was neither right nor sustainable. That India stood ready to reduce deficits which South Asian countries were incurring in exchange of their goods and services. This is as clear as it gets that India might roll out unilateral trade liberalization; take whatever they have to offer to boost trade within South Asia from the lowly five per cent level at present.

India’s compulsions to do so are simple. If the drift in South Asian integration is allowed to continue, it will only be to the advantage of China. The dragon’s shadow is indeed lengthening over the region, as it is rapidly developing port and transport infrastructure in Pakistan and Sri Lanka. It has promised aid to Nepal to develop its northern border districts. Nepal has also opened more border trading points with China. That China has become Bangladesh’s largest trading partner is a painful reminder to India of its failure to deepen economic cooperation in the neighborhood. Clearly, the challenge for India is to defend its turf against China.

It is in Nepal’s interests, too, that it addresses the sources of discontent over the constitution through dialogue to ensure broad-based-ownership and acceptance. Its top leadership has also agreed to amend the constitution within three months. A more harmonious relationship with India, too, is in its interests. For instance, it has not been able to tap its abundant water resources by developing hydroelectricity generation. South Asia’s diverse topography lends itself to greater cross border power trade, but political inhibitions have ensured that progress has been less than the potential. Some power trading is taking place in the region bordering Bhutan and India.

Nepal has of late seized this opportunity but politics can swiftly derail this process. The signing of a much delayed $1.4 billion deal between the Investment Board of Nepal and India’s GMR Group to develop a 900 MW dam and tunnel system on the upper Karnali River is exactly the sort of big ticket project that can transform the economy of this Himalayan kingdom. Another Indian firm, Satluj Jal Vidyut Nigam Limited signed a deal with the Nepal Government to build a 900 MW project known as Arun-3 in east Nepal. These are just two examples of India’s involvement to help Nepal realize its hydro power potential.

Nepal is also part of India’s efforts to secure greater connectivity by road, rail and sea within South Asia with Bangladesh and Bhutan. These countries have signed a motor vehicle agreement for freer movement of passenger, cargo and personnel traffic within these countries. These processes must be allowed to fructify. This is exactly the sort of stake that Nepal needs to develop in an economics and business-driven partnership with India. Allowing the processes of regional integration to drift is another Himalayan blunder that Nepal can do without.

(End)

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