South Africa has pledged to help Nigeria make the automotive sector the West African nation’s flagship industrial target. Currently German car manufacturer BMW has a plant at Rosslyn near Pretoria. About 80 percent of the BMWs produced there are for the international market. Credit: John Fraser/IPS

The lack of economic diversification throughout sub-Saharan Africa means that despite South Africa’s pledges to help Nigeria make the automotive sector the West African nation’s flagship industrial target, it may be difficult to do so, experts say.

Earlier this month, South African Trade and Industry Minister Rob Davies announced the initiative during a visit here by Nigerian President Goodluck Jonathan.

It is a move that is seen as an important milestone in inter-African industrial cooperation. However, Peter Draper, a research fellow at the South African Institute of International Affairs, questioned whether this collaboration would develop into economic integration.

“The real question is whether such cooperation could ultimately evolve into meaningful, broader, economic integration rather than the network of mostly hollow shells that currently masquerade as free trade agreements,” he told IPS.

“I think that Nigeria and the Southern African Customs Union should negotiate a complementary Free Trade Area agreement to promote closer economic relations – as the complementarities are strong, and it would bring the two countries closer together politically.”

Draper said that the African Union (AU) has already developed a number of initiatives for specific sectors, but more needs to be done.

“Actually there are quite a few sectoral policies covering, inter alia, energy, communications, transport, and various other integration initiatives. The problem remains implementation, not a lack of plans,” he said.

He said that it seemed to be commonly accepted that the AU’s role was to develop and coordinate implementation of a continental “master plan” that integrates these various initiatives.

“I think there is a role for a broader continental perspective, but I prefer the notion of ‘subsidiarity’ – pioneered in the European Union – where implementation is left to the lowest possible level of government.”

Draper said that the cooperation between South Africa and Nigeria could be an important mentoring initiative for South Africa.

“South Africa has been (involved in) auto industry policy development since the mid-1920s and has a lot of experience to draw on and share,” he explained.

“It reminds me of cooperation in Latin America, which historically evolved through sectors, involving the auto industry particularly. The European Community (which became the EU) also started out through a network of sectoral collaboration – iron and steel in particular.”

Minister Davies told the Business Day newspaper that discussions on automotive cooperation with Nigeria were still at an early stage.

But while some manufacturers, such as Nissan, might be willing to set up plants in Nigeria, others are more cautious.

Bodo Donauer, the managing director of BMW South Africa, said that in his group “production follows the market” and he does not currently envisage a BMW plant being established in Nigeria.

“Local production plants make it easier to access and develop new markets with long-term growth potential. Having a local plant also makes the company a ‘local player’ and boosts acceptance of the products locally and underscores our good corporate citizen approach,” he said.

“The success of this strategy has been proven by positive sales trends since the ramp-up of production plants, for example in the Unites States, in China, in the United Kingdom and, of course, in South Africa.”

He said that around 20 percent of BMWs produced at the Rosslyn plant near Pretoria are sold on the local market in South Africa “with more than 80 percent exported to markets around the world, including one percent to certain markets in the rest of Africa.”

“Given the current size of the new premium car market in the rest of Africa, we believe the BMW Group is well-placed with its current global production network to meet any additional demand in markets like Nigeria without the necessity for additional production locations,” he said.

Peggy Droidskie, an advisor to the South African Chamber of Commerce and Industry, said that the initiative between South Africa and Nigeria was very welcome, as regional integration in Africa remains high on the development agenda.

“Nigeria is a large market, and it is closer to Europe. This proximity to Europe implies that it would be logical for European connections to be used.

“The fact that South Africa is preferred (as a partner for Nigeria) indicates that South Africa is very competitive and can accommodate the requirements of Nigeria. It also provides South African manufacturers with an additional footprint in Africa,” she said.

Droidskie predicted that some manufacturers who currently operate in South Africa would become interested in setting up in Nigeria.

“Agreements of this nature are driven by politicians,” she noted. “The politicians believe that the agreements that they enter into benefit the private sector, which is often, but not always, the case.”

She said that South African vehicle manufacturers are already exporting a significant number of vehicles to Nigeria.

“Last year, the number was nearly 15,000. Nigeria is therefore currently a lucrative market for South African vehicle manufacturers. It is therefore very likely that the manufacturers will take advantage and come to the party.”

And she predicted that this cooperation could expand to other industrial sectors.

“If the profile of Nigeria’s imports is taken into account, there is considerable room for an increase in South African exports to Nigeria. For instance, there is room for greater trade in electrical and electronic equipment and machinery.

“With the development of the Tripartite Free Trade Agreement between the three regional economic blocs in sub-Saharan Africa, there is considerable potential for cooperation to expand to other countries and to other sectors.”

Many of the workers who survived the factory collapse in Bangladesh have lost their limbs. Credit: Naimul Haq/IPS

“It was dark and hot with choking dust all around. The air was filled with the smell of decomposing corpses,” recalled Nasima, a 24-year-old factory worker who spent four days buried under the rubble of an eight-storey building that collapsed in a suburb of Bangladesh’s capital Dhaka last month.

The young woman recounted the terror that she and four fellow female workers experienced as they lay beneath glass and concrete, just “inches” from death. Rescue teams found them sandwiched between the fifth and sixth floors of the massive Rana Plaza that had housed five garment factories.

Nasima had joined Ether Garments, one of the many companies housed in Rana Plaza, only 20 days before the tragedy, Bangladesh’s worst industrial accident, which killed 1,127 workers according to the latest count.

While families searched desperately for loved ones in the ruins in the town of Savar, 25 kilometres from Dhaka, reports of negligence and lack of workplace safety emerged. It became clear that factory owners had been warned of a possible collapse of the building that was only legally permitted to house five floors.

As survivors came to and began to speak out, they reported that management personnel had ignored recommendations by engineers to keep factories shut on Apr. 24, going so far as to threaten workers with dismissal if they failed to report for duty as usual.

The revelation sparked international outrage and shed light on the inner workings of Bangladesh’s garments sector, the country’s largest foreign exchange earner, which brings in about 20 billion dollars a year.

Multinational retailers like H&M, Gap, Walmart and Primark, which have outsourced most of their production to Bangladesh to take advantage of cheap, mostly female, labour, came under fire for failing to enforce safety standards.

While these accusations are not new, rights groups hope this latest tragedy will jolt the industry into implementing better labour laws and adhering to safety standards.

They say the roughly 2,500 rescued workers, many of them women, are living proof that Bangladesh must not repeat the mistakes that led to the Savar tragedy.

Living proof of negligence

Speaking to IPS from her hospital bed in the National Institute of Traumatology & Orthopaedic Rehabilitation (NITOR), 19-year-old Shapla, whose left arm was so badly injured that it had to be amputated on the site, recalled surviving for several hours squeezed between the second and third stories of the building, “with blood and corpses all around.”

Shapla’s husband, Mehedul, who worked as a sewing operator on the same floor, told IPS he survived by sheer luck, as he had been at the back of building at the moment the massive structure pitched forward.

Most of those working at the front of the building were crushed under the full weight of falling concrete slabs and crumbling walls.

Others, like 21-year-old Razia, say it is too painful to go on. “Someone give me poison. I want to die,” she cried out in the hospital ward where she and 121 other survivors are being treated free of cost.

She told IPS she and a few other girls had been “gossiping about the previous day’s decision to keep the factory open,” despite large cracks appearing on the pillars the day before. The next minute she heard what sounded like a huge explosion; then everything went dark.

For the next 14 hours, she struggled to breathe through the thick dust that hung around her.

In the hospital bed beside her lies Shamsul Alam, a 28-year-old quality inspector whose doctors say his spinal injuries are “too dangerous to operate on” and may end up being fatal.

Though he has not been informed of their bleak diagnosis, he told IPS he now “knows what its like to be in a coffin”, explaining the helplessness of being trapped and listening to people die around you.

Meanwhile, the trauma has wiped some survivors’ memories clean. An operator named Runu, unable to recall a single thing about that fateful day, stares vacantly into space while her sister tells IPS that Runu spent a full two days under the rubble before finally seeing daylight.

Those who can remember have vowed neither to forget nor to step foot into a factory again. “I will resort to begging if I have to, but I’m not working in a garments factory ever again,” 25-year-old Mariam, whose legs and arms were pulverised by concrete and iron rods, told IPS.

“My freedom means I was born again,” added a former worker named Shakhina. “I will not make the mistake of stepping back into that death trap.”

Meanwhile, major players in the industry are finally taking heed.

A.K.M Salim Osman, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), one of the industry’s apex bodies, told IPS that the incident in April was a “wake up call for us who depend on the labourers for business.”

“If we continue to ignore strict ethical standards (around) safety issues we will fail again,” he warned.

Osman said the recently ratified Bangladesh Building and Fire Safety Agreement is a step in the right direction. Under the accord, a tripartite committee comprised of company representatives, trade unions and a neutral inspector chosen by the International Labour Organisation (ILO) will monitor progress in implementation of safety standards as laid out in previous protocols such as the 2006 Occupational Safety and Health Convention.

Initiated by the IndustriALL and UNI Global Unions, the regulations insist that all buildings vulnerable to minor or major cracks be inspected and recommendations put forth by engineers adhered to immediately.

“If necessary we will force factories (with defects) to shut down until standards are met,” Mohammad Shafiqul Islam, former president of the Bangladesh Garments Manufacturers and Exporters Association (BGMEA), the largest body in the business, told IPS.

In a cabinet meeting on Apr. 29, the Bangladesh government decided to form a committee tasked with carrying out regular inspections of factories, installing fire safety devices and ensuring that companies conduct regular fire drills for the workers.

According to a statement by the American Apparel and Footwear Association, the agreement has also won support from all major locals unions, which represent the roughly 3.5 million workers employed in over 5,000 factories housed in and around Dhaka, and in the port city of Chittagong.

Recently reconstructed Maracaná stadium in Rio de Janeiro. Credit: Governo do Rio de Janeiro CC BY 3.0

As Brazil prepares to host several sporting mega-events, human rights abuses and authoritarian interventions by the authorities are going on behind the scenes, favouring major urbanisation projects and stadium remodelling, a study says.

The state has forced almost 30,000 families across the country to leave their homes, according to the Comité Popular da Copa e das Olimpíadas (World Cup and Olympics People’s Committee), made up of around 50 social movements, researchers, NGOs and trade unions.

The Committee’s report, “Megaeventos e Violações dos Direitos Humanos no Rio de Janeiro” (Mega-events and Human Rights Abuses in Rio de Janeiro), says that in this city alone, which will host the 2016 Olympic Games, 3,000 families have already been displaced from their homes and another 7,800 are facing eviction.

The forced displacement of thousands of people and the privatisation of public areas constitute the dark side of Brazil’s sports projects, claims the study which was presented in Rio de Janeiro on Wednesday May 15.

Brazil will host the FIFA (International Federation of Association Football) World Cup, which is to be held in 12 cities, in 2014. A dress rehearsal for this will be the ninth FIFA Confederations Cup, a tournament between the top national teams from each continent, from Jun. 15-30 this year.

“Our fears are being confirmed. The benefits and social legacy that are so widely trumpeted really hide a dark legacy: an elitist, segregated and unequal society. It is a sad thing to see,” said Orlando Alves dos Santos Jr., a sociologist and urban planner and one of the study coordinators.

In the view of dos Santos Jr., a researcher at the Observatório das Metrópoles and the Institute of Urban and Regional Planning and Research at the Federal University of Rio de Janeiro, the multi-million dollar investments carried out under the cloak of preparations for the World Cup and the Olympic Games go beyond the scope of sports facilities and are part of a grand project of urban reform.

Interventions in cities, like evictions, are having an immense impact in terms of social exclusion, the report says.

“We show that poor people are being relocated outside the areas of investment, which are concentrated in the centre, south and north of Rio de Janeiro. These are areas where real estate has vastly increased in value,” dos Santos Jr. said.

He said the rise in housing prices has been largely based on the displacement of the poor towards the outskirts of the city.

“All this has been accompanied by a complete lack of information for the evicted families, as well as coercion, the use of violence and human rights abuses. What is happening in the city is extremely serious,” he said.

Christopher Gaffney, a U.S. geographer who studies public policies on sports and security for big events, told IPS that evictions and the privatisation of public spaces represented a great failure of democracy in this country of over 195 million people.

“The policy is a big step backwards. It represents a reversal of values that eliminates the role of government as the guarantor of essential citizen services, like housing and culture. Forced evictions are a clear violation of the right to housing. Real estate speculation is rife in Rio,” he said.

Gaffney, who is also a member of the People’s Committee and a researcher with the Observatório das Metrópoles, said that there is no “coherent practical criterion” being applied in the eviction of thousands of families, and that those affected by the policy complain of a lack of dialogue, transparency and information.

“The uncertainty associated with being made homeless creates constant panic, and terror methods are being used to expel these people from their communities at any price,” he said.

“There have been cases where families have been told they must vacate their homes, without any time for them to collect their belongings; and others where their eviction has been negotiated right alongside the bulldozers that were ready to demolish the houses. This is enormous psychological pressure,” he said.

Only a few families received a decent house after their eviction, Gaffney said. The authorities provide indemnities for expropriation that are not enough to buy a new house, or they put families into housing plans that have requirements that many of them cannot meet, such as that the head of household must have a formal sector job and a bank account.

The report argues that the real Olympic legacy in Rio de Janeiro will be that of “an even more unequal city, which will exclude thousands of families and destroy entire communities…a project that will appropriate the majority of benefits for a select few economic and social agents.”

One of the main criticisms is the privatisation of public spaces worth millions of dollars. In Rio de Janeiro, sporting facilities like the legendary Maracaná stadium are being renovated, as well as infrastructure and transport facilities, and urban remodelling projects have mushroomed.

The initial budget for investment in the city for the upcoming events has risen by 95 percent, from 1.1 billion dollars to 2.1 billion.

Construction and renovation of stadiums represent nearly 25 percent of this total. Maracaná stadium, where the finals of the 2014 World Cup will be played and where the opening ceremony for the Olympic Games will be held two years later, is the focus of controversy because it has been granted in concession to a private consortium for 35 years.

The cost of the works undertaken was 600 million dollars, compared with the 370 million dollars initially envisaged. The concession of the stadium into private hands for the first time led the public prosecutor’s office to launch an investigation into the state’s investments for the sporting mega-events.

In Gaffney’s view, the sporting facilities will be transformed from cultural spaces into consumption centres.

“Stadiums are the platforms where local culture is expressed in football. It would be virtually cultural assassination to substitute faithful, traditional fans with ‘clients’ or higher class consumers,” he said.

Moreover, the private initiative will also lead to the demolition of a major aquatic park, a public school, an athletics track and a prison, in order to build two multi-storey car parks for 2,000 vehicles, a heliport, a shopping mall and a football museum.

“This shows the vulnerability of Brazilian democracy, even as Brazil is trying to build stronger institutions. The FIFA World Cup and the Olympic Games are accelerating anti-democratic processes,” Gaffney said.

Dos Santos Jr. said that society has taken the multi-million dollar renovation passively, and that construction of the Maracaná complex “will bring about the destruction of multi-purpose facilities that were used to practise other sports.

“It will only be a space for show and a commercial centre. Athletes in other disciplines will not have a place to train. And the entrance tickets will be too expensive,” he said.

The People’s Committee intends to present its study to public authorities, FIFA, the International Olympic Committee and international organisations such as the United Nations through its Special Rapporteur on the Right to Adequate Housing.

China and India are expected to be the largest investors by 2030, accounting for 38 percent of all global investment. Credit: Bigstock

Over the next decade and a half, a major global shift will result in the developing world controlling roughly half of the world’s capital, up from less than a third today.

According to new scenarios released Thursday by the World Bank, developing countries could control some 158 trillion dollars (at 2010 rates) by 2030, particularly in East Asia and Latin America. By that time, the developing world could account for 87 to 93 percent of global growth.

Under certain scenarios, “financial markets in economies like Brazil, India, and those of the Middle East will develop considerably, with these countries attaining, by 2030, a level of financial development comparable to the United States in the early 1980s,” a new report from the Washington-based development lender states. “Similarly, the quality of institutions in developing countries will tend to improve significantly.”

This analysis suggests that developing countries will soon gain the resources necessary to bankroll the major investments that the bank says will be necessary, particularly in infrastructure and services. This would mark a stark contrast with the past.

Further, World Bank analysts foresee a massive escalation of global investment from these countries. Whereas in 2000 international investment from developing economies constituted just a fifth of the global total, this could now triple over the next decade and a half.

“We found that developing economies will come to dominate investment,” Maurizio Bussolo, a World Bank lead economist and author of the new Global Development Horizons report, told reporters Thursday.

“By 2030, for every dollar invested around the world, 66 cents will be in developing countries. That’s a dramatic change, as for almost four decades such investments made up just 20 cents on the dollar.”

In fact, Bussolo suggests that developing countries will overtake the developed world in this regard much sooner, perhaps by the end of this decade.

Fast-strengthened systems

China and India are expected to be the largest investors by 2030, accounting for 38 percent of all global investment, almost as much as all high-income countries combined. In fact, China alone could be responsible for nearly a third of global investment by that time, the bank says, while Brazil, India and Russia will together constitute a larger investment bloc than the United States, at around 13 percent.

This means that total investments in the developing world could be half again as large as among developed countries, at 15 versus 10 trillion dollars.

Such changes will require the exponential development and strengthening of financial sectors in developing countries, as emerging economies inevitably move to quickly integrate with the international financial system in a way never before seen.

“Developing countries are currently almost absent from international financial markets, so you can see that we have a very long way to go in a historically short time period – 15 or 20 years for developing financial markets is not long,” Hans Timmer, director of the Development Prospects Group at the World Bank, told reporters.

“But we have seen in high-income countries that if you deregulate too rapidly you have a very dangerous situation. So we have a dilemma: the role of developing countries is increasing very rapidly, but we must deepen these financial markets only very gradually.”

Already, weak financial systems across the developing world are allowing for illicit outflows of capital that are at times far greater than the countries’ external debt, inexorably impacting on those countries’ ability to finance their public sector.

One report last year estimated that North African countries alone lost nearly a half-trillion dollars over the past four decades, almost the equivalent of their combined gross domestic product for 2010.

“It’s important to note that the World Bank is only talking about recorded capital here, but there’s so much illicit capital currently sloshing around that the multilateral institutions haven’t yet gotten their heads around,” Dev Kar, formerly with the International Monetary Fund (IMF) and currently the chief economist with Global Financial Integrity, a Washington advocacy group, told IPS.

“Our studies suggest that the unrecorded capital coming from developing countries is absolutely huge – the losers are losing far more than the gainers are gaining. As a result of these developments, you can understand why the North African countries blew up, as that kind of massive outflow of resources must have some kind of social impact.”

A level field

Of potentially considerable concern in the bank’s projections is where this new wealth will end up being concentrated.

“It’s one thing for the pie to be increasing, but how equitably is it being distributed?” Kar asks.

“Equity is a huge problem, as the rich seem to be getting richer and the poor getting poorer. Further, it seems the nouveau riche in the developing countries are a bit more callous than the established rich in developed countries.”

Kar notes that income inequality is generally not being helped through current redistribution mechanisms aimed at ensuring broader equal opportunity. Meanwhile, the poor, being unable to take advantage of globalisation, are being left behind across the globe.

According to the World Bank and numerous other analysts, wealth in developing countries is today largely locked up among the elite.

“For most of these countries, the first quarter of the population provides almost no savings. The bulk of savings comes from the richest quarter – there is lots of concentration,” the World Bank’s Bussolo told IPS.

In a separate statement, he noted: “Even if wealth will be more evenly distributed across countries, this does not mean that, within countries, everyone will equally benefit. Policymakers in developing countries have a central role to play in boosting private saving through policies that raise human capital, especially for the poor.”

In particular, the new report places significant focus on increasing government funding for education. It points to analysis from Mexico suggesting that changes in education could result in a five percent greater household saving rate by 2050.

“If the distribution of education among workers of future generations were to remain as unequal as it is today, this would perpetuate inequality of earning capacity, saving, and wealth in the future,” the report states.

“Leveling the playing field in terms of educational opportunities could thus be supported not just in terms of fairness but also – given the positive effect on private saving – in terms of efficiency.”

Bishkek and Toronto-listed Centerra Gold are engaged in a protracted legal dispute over Kumtor, the largest gold mine operated by a Western company in Central Asia.

Earlier this year, a Kyrgyz state commission claimed Centerra owes approximately 467 million dollars for environmental damages. Then, in February, parliament gave Kyrgyz officials three months to negotiate a new operating agreement, which would be the third in 10 years.

Kyrgyz officials say the current agreement, negotiated under former president Kurmanbek Bakiyev in 2009, shortly before he was ousted amid violent street riots, was unfair. The company, which also operates a mine in Mongolia, argues that it negotiated in good faith with what was at the time the legitimate government, and has threatened to seek international arbitration.

It calls the 467-million-dollar claim — which other miners in Bishkek say is a negotiating tactic — “exaggerated or without merit.” Centerra officials also point out that the agreement gave the company confidence to invest almost one billion dollars in the mine since 2009.

Kumtor is critical to Kyrgyzstan’s economy. Last year the mine, which sits above 4,000 metres in the Tien Shan mountains, contributed approximately 5.5 percent of the country’s GDP. In 2011, a good year, the mine accounted for 12 percent of GDP and over 50 percent of industrial output. Earlier this month, Centerra announced its first quarter revenue rose 44 percent.

Negotiations are likely to focus on current operating agreement’s structure, a source close to the Kyrgyz side told EurasiaNet.org. Under the existing agreement, Kyrgyzstan owns close to one-third of the Toronto-listed company. That arrangement places Bishkek in a bind: if the government fines the company, it hurts its own potential dividends.

Bishkek is ready to divest itself of Centerra ownership, the source said, in return for “both a higher income stream and more direct control over operations at the mine.”

The current agreement “doesn’t allow the nation to properly exercise its function as a sovereign. It actually creates an internal conflict. The more they levy tax, the more they assess environmental penalties, the less revenue is available to them in dividends,” the source said, speaking on condition of anonymity due to the sensitivity of the negotiations.

“This structure may be very useful to Centerra, but it is very difficult to understand why, in 2009, the Bakiyev regime pressed for this structure. That reinforces the suspicions of corruption.”

Centerra has repeatedly denied allegations of corruption, and Kyrgyz authorities have not presented convincing evidence the company engaged in corrupt practices. But some believe the venal Bakiyev administration was eager to obtain stock options so it could one day sell them and embezzle the proceeds.

Kyrgyzstan’s shares are held by the state-run gold company, Kyrgyzaltyn. Kyrgyzstan “has every interest in seeing shareholder value maximised and Centerra run as a profitable and successful business,” Kylychbek Shakirov, Kyrgyzaltyn deputy chairman for economics and finance, said in a May 10 speech to shareholders.

Shakirov stressed that Kyrgyzstan is not seeking to nationalise the mine, but said his delegation was acting as a “responsible shareholder” by pushing for Centerra to use a new auditor (it has employed KPMG for a decade) and sideline a senior member of the board while he faces insider-trading allegations in Canada.

Shakirov also expressed “strong reservations” about proposals to offer senior Centerra managers pay raises, noting that in the past few years, compensation packages have risen “sharply as the company’s performance overall was falling.”

Centerra’s top five principals each earned, on average, over 1.6 million Canadian dollars in 2012, 56.7 percent more than they earned in 2010, according to the management information circular distributed at the shareholders’ meeting. Yet, over the past two years – while production has fallen and the company has faced repeated calls for nationalisation by some Kyrgyz politicians – the company’s value has fallen roughly 80 percent.

John Pearson, Centerra’s vice president for investor relations, told EurasiaNet.org that the two sides “are making progress” as they approach negotiations, which parliament has said must be completed by Jun. 1.

“The discussions with the government are ongoing. Most recently in our discussion with the government we recommended that they retain external independent advisors on both the financial and legal fronts and they have done so,” he said.

Bishkek is said to have hired DLA Piper, the law firm, and Price Waterhouse Coopers as advisors.

In recent weeks, increased waste rock movement at Kumtor has highlighted long-standing environmental concerns, some of the thorniest issues in the negotiations. Centerra points to studies – including several commissioned by Bishkek – that absolve it of wrongdoing.

But questions remain about whether an accelerated pace of melting ice at the high-altitude mine is being encouraged by extraction activities there.

As part of its approach, Bishkek is expected to push for a review of environmental compliance standards, while it considers ways of tightening its own legislation related to mining’s environmental impact in general.

*Editor’s note: David Trilling is EurasiaNet’s Central Asia editor.

This story originally appeared on EurasiaNet.org.

H&M, a major European apparel chain, signed the agreement Monday, and Benetton, which was under fire from activists after their clothing was found in the ruins of the Rana Plaza factory which collapsed in late April, signed on Tuesday.

The ruins of the eight-story Rana Plaza factory. Credit: Rijans/CC BY-SA 2.0

The nearly month-long search for victims in the wake of the Rana Plaza collapse ended Monday, after the death toll had reached 1,127.

“H&M’s decision to sign the accord is crucial,” Scott Nova, executive director of the Worker Rights Consortium (WRC), an independent labour rights watchdog group based in Washington, said in a press release.

“They are the single largest producer of apparel in Bangladesh, ahead even of Walmart. This accord now has tremendous momentum.”

Other European companies that signed the accord, known as the Bangladesh Building and Fire Safety Agreement, included Inditex, C&A, Primark and Tesco. By Tuesday evening, the only U.S. company to agree to the accord was PVH, the parent company of Tommy Hilfiger and Calvin Klein, which signed last year.

According to the International Labor Rights Forum (ILRF), an advocacy organisation, the new agreement covers all major areas needed to ensure its effectiveness: “independent safety inspections with public reports, mandatory factory building renovations, the obligation by brands and retailers to underwrite the cost of repairs, and a vital role for workers and their unions”.

The pact also calls for participating companies to pay up to 500,000 dollars a year toward building maintenance and safety in Bangladeshi factories, to bring them up to a specified standard. According to Liana Foxvog, ILRF communications director, the associated costs would translate into about ten cents per garment.

The agreement between several major European companies has also been significant in that it now focuses a spotlight on the relative inaction of their U.S. counterparts – and narrows and intensifies the pressure from labour groups on U.S. companies to sign the pact.

“The fact of European brands signing on is very important for the Bangladesh garment industry,” Foxvog told IPS. “It’s time for U.S. companies to sign on as well.”

Labour groups are particularly focused on Walmart and Gap, two of the largest and most influential companies that source from factories in Bangladesh. Foxvog said that “If Gap changes its mind, we expect that more U.S. companies will sign on.”

Gap, which was close to signing the agreement last year before starting its own non-binding, voluntary agreement with factories in Bangladesh in October 2012, said Monday that the company was concerned about possible “legal liability” issues that could arise.

The company said Tuesday that it was “six sentences away” from signing the accord and would accept if those proposed sentences, which lessen its liability concerns, were accepted.

But critics say such arguments have little substance behind them.

“They’re nonsense,” WRC’s Nova told IPS. “Ask Gap wherein the legal liability lies; ask them to point to the language in the agreement that creates legal liability for them – they can’t do it. What Gap wants is an agreement that can’t be enforced. The stuff about legal liabilities is a ruse.”

Foxvog expressed similar sentiments.

“Gap is saying it doesn’t want to be held accountable for the working conditions (in the factories) and other commitments of the safety agreement,” she said.

Company-led change

Still, labour rights groups are growing increasingly optimistic, as companies seem to be facing increasing pressure to conform to multi-stakeholder agreements, and the Bangladeshi government has shown signs of committing to stronger labour standards.

On Monday, Bangladesh’s cabinet lifted restrictions on forming unions, reversing a 2006 law that required employees to obtain permission from an employer before organising.

And the previous day, the government set up a new minimum wage board that will include factory owners and workers, and government officials, and will recommend pay raises. However, the decision to implement these new standards will still need to be approved by the cabinet.

But for broader change, advocates argue that the active participation of multinational companies is key to bringing about permanent change in the Bangladeshi garment industry. Proponents are now hoping that the announcement by the 10 European companies – with more, perhaps, to come – could now create a transatlantic ripple effect.

“This is a really tremendous advance to have … global brands and retailers make a binding commitment to worker safety,” Judy Gearhart, executive director of the ILRF, said in a statement. “Now we need major U.S. brands and retailers such as Walmart, Gap, and JC Penney to join in the same agreement.”

Walmart has said its own safety plan meets or exceeds the building and fire safety code’s standards, but added that it would continue to discuss the plan.

Howard Riefs, spokesman for Sears, also a large producer in Bangladesh, said late Tuesday that while the company is still in discussions over the plan, it is not yet ready to sign on. JCPenney and The Children’s Place are also reportedly still evaluating the plan.

Last week, the ILRF and United Students against Sweatshops, an advocacy group, launched a new website, designed to ramp up pressure on Gap to sign the Bangladesh Fire and Building Safety Agreement.

“I find it hard to believe that Gap is irresponsible enough to continue on this course of action (of avoidance) any longer,” Nova told IPS.

“The results of the selection process reveal that most members of the WTO (World Trade Organisation), the majority of whom are developing countries, are dissatisfied with the current status quo – which Blanco represented,” Deborah James, coordinator of the Our World Is Not For Sale (OWINFS) network of dozens of organisations, activists and social movements worldwide, told IPS.

She said the countries were frustrated “in terms of continuing the current failed model of corporate globalisation, based on liberalisation and deregulation – that the WTO consolidates globally – without regard for the negative impacts of these policies on workers, farmers, and the environment.”

WTO director general-designate Roberto Carvalho de Azevêdo. Credit: WTO/CC BY SA-2.0

Azevêdo’s formal appointment on Tuesday May 14 was seen as a breath of fresh air in the rarefied climate which has numbed the WTO – headed over the last eight years by French economist Pascal Lamy – for at least a decade.

In its statement before the WTO General Council, which endorsed the appointment of Azevêdo to a four-year term starting Sept. 1, the South Africa delegation said “we celebrate a triple victory: it is a victory for the principle of diversity, it is also a victory for the principle of consensus, and it is a victory for the principle of multilateralism.”

It also urged the WTO to guarantee that its leadership reflected the diversity of its 159-nation membership, representing all of the world’s regions.

“Today we succeeded in ensuring that Latin America is represented in the leadership of the WTO for the first time,” the delegation said, adding that it would soon be Africa’s turn to contribute its rich leadership to the global trade body.

The WTO and its predecessor, the General Agreement on Tariffs and Trade (GATT), have been governed by representatives of industrialised nations with the exception of the period 2002-2005, when the organisation was led by Supachai Panitchpakdi of Thailand.

James said “Now it will be up to the new Director General Azevêdo to respond to the obvious need that global civil society (through the OWINFS network) has been highlighting: for the transformation of the existing system, to ensure that it can provide countries sufficient policy space to pursue a positive agenda for development and job creation, and so that trade rules can facilitate, rather than hinder, global efforts to ensure true food security, sustainable economic development, global access to health and medicines, and global financial stability.”

Médecins Sans Frontières (MSF) urged Azevêdo to put a priority on access to medicine.

MSF Director of Policy and Analysis Rohit Malpani said “Mr. Azevedo’s appointment comes as least developed countries (LDCs) member states have requested to remain exempt from implementing the TRIPS (Trade Related Aspects of Intellectual Property Rights) Agreement until they are no longer classified as LDCs.

“The request for extension would allow these countries to avoid monopoly protection for medicines, diagnostics and medical devices,” he added.

This request and other demands by the LDCs, along with the questions of agriculture and trade facilitation, are among the issues likely to be on the agenda of the WTO ministerial conference slated for Dec. 3-6 in Bali, Indonesia.

Azevêdo has avoided making clear statements on the WTO’s future because he is merely director general-designate until September.

However, in an acknowledgement of the difficulties facing the negotiations in Bali, the Brazilian diplomat warned that if the meeting is “not successful, it will make the road a lot more difficult ahead.

“We need to move the WTO from where we are today to an organisation that is again meaningful, that again delivers negotiated outcomes that the world hopes and expects from us.”

But the differences among the negotiators are not the only threat to the conference in Bali. The Asian Peasant Coalition (APC) announced that “We will register our strong resistance against the WTO in its 9th ministerial meeting.”

The APC will hold a series of coordinated activities against the WTO meeting, in Bangladesh, India, Indonesia, Nepal, Pakistan, the Philippines and Sri Lanka, said the organisation’s deputy secretary general, Rahmat Ajiguna.

The WTO accords in agriculture “resulted in massive displacement, destruction of local industry, and increasing land and resources grabs,” the APC added.

A white rhino at a sanctuary in South Africa’s Limpopo province. Credit: Jennifer McKellar/IPS

At first glance, the poster appears to be a typical advertisement for an African safari: a large rhinoceros set against a rugged, open terrain. Then you take a closer look and realise something is amiss.

A cluster of human hands has replaced the two horns that distinguish this African animal from the single-horned Indian and Javan rhino. A message over the creature’s head reads: “Rhino horn is made of the same stuff as human nails. Still want some?”

Produced jointly by the wildlife watchdogs TRAFFIC and the World Wildlife Fund (WWF), these posters are soon to appear on the walls of public places in major Vietnamese cities including the capital, Hanoi, and Ho Chi Minh City.

Offices, apartment buildings and even airports are all set to become sites in the campaign to end the illegal international trade in rhino horns that is threatening the ungulate to extinction.

Experts say there is no better place than this Southeast Asian nation of 87 million to drive this stark message home. Vietnam has long been singled out by international groups monitoring the illicit wildlife trade for the dramatic rise in domestic demand for African rhino horns.

Close to 290 of the 20,000 rhinos left in South Africa have been killed for their horns since the beginning of this year, according to conservationists worried that such a deadly spree could see the death toll match the record number of 668 rhinos killed by poachers in 2012.

“We are in the midst of a rhino poaching crisis,” Mark Jones, a British veterinarian who heads the London-based Humane Society International, told IPS, adding that Vietnam has recently emerged as the main market for rhino horns.

The spike in demand has been shaped by a belief among locals that has taken root over the past five years: that rhino horn has special medicinal powers, including the ability to treat cancer, cure hangovers, and act as an aphrodisiac.

According to Naomi Doak, coordinator of the Greater Mekong Programme at TRAFFIC, the graphics for the new campaign poster were developed after experts realised that a “large proportion of the Vietnamese public” were not aware that rhino horn, a mass of agglutinated hair, is comprised of keratin, the same basic substance that constitutes human finger and toenails.

She hopes that bringing this fact to light will make people “think twice before consuming rhino horn.”

Yet driving home this message will be “a long and difficult campaign,” Doak admitted in an interview with IPS. “With very few penalties and consequences people really aren’t that concerned about the impacts the consumption of rhino (horn) has either on the animals or on people.”

A status symbol

To understand what wildlife protection groups are up against, one need only take a stroll through Hanoi’s famed Old Quarter, a colourful network of 36 streets where crafts and local products have been hawked for centuries.

Here, shops specialising in traditional Chinese medicine (TCM) attract scores of customers seeking remedies made from wild animal parts, including rhino horn.

In his latest documentary ‘Bad Medicine – Illegal Trade in Rhinoceros Horns’, conservationist and filmmaker Karl Amman traces the routes of illegal traffickers from the Africans wilds to the streets of Vietnam, where “rhino horns have also become a status symbol,” he said.

This explains why gold, once the favourite gift among the communist-ruled country’s expanding class of wealthy citizens, has been dethroned by rhino horns, which currently fetch 65,000 dollars per kilogramme.

This is “more than gold, gram for gram,” according to Jones. Though the weight of rhino horns vary, an individual horn can fetch upto 150,000 dollars.

The pressure on Vietnam to curb the demand for illegal rhino horns is expected to grow following the resolutions passed in March at the Bangkok meeting of the Convention on International Trade in Endangered Species (CITES). The strong language at this 16^th global gathering of 178 member countries fell just short of imposing sanctions on Hanoi.

The Vietnamese government, meanwhile, has consistently denied allegations that it is a major market in this global trade. It often points an accusing finger at its powerful northern neighbour, China, which is also under scrutiny for boosting the illegal wildlife trade, particularly the demand for tiger parts.

But activists have proof, and are not prepared to remain silent.

Do Quang Tung, deputy director of CITES Vietnam, who headed his country’s delegation to the Bangkok talks, told a Vietnamese newspaper in late March, “From 2004 until now, 13 (individuals) involved in rhino trafficking were arrested, with a total of 150 kg of rhino horns.” Two of these cases, he said, occurred in early 2013.

“Illegal trade in rhino horns involves highly organised, mobile and well-financed criminal groups, mainly composed of Asian nationals based in Africa,” a report published by TRAFFIC and the International Union for Conservation of Nature (IUCN) revealed early this year.

“These networks have recruited pseudo-hunters including Vietnamese citizens, Thai prostitutes and proxy hunters from the Czech Republic and Poland to obtain rhino horns in South Africa,” added the report.

“Pseudo-hunting has significantly reduced as a result of a decision to prevent nationals of Vietnam from obtaining hunting licenses and changes to South African law in April 2012.”

Another embarrassment for Vietnam has been scandals involving its diplomats at the South African mission who were accused of smuggling rhino horns in 2006 and 2008. When confronted about these incidents at the recent CITES meeting in Bangkok, a Vietnamese government official said that the errant diplomats had received “punishment” for their actions.

Hopes are running high that the impending poster campaign will do its part to educate the public and bring an end to the thriving trade. But it will take more than two animal rights groups to halt rising demand.

Nguyen Thuy Quynh, of WWF Vietnam, said recently, “We are seeking support and cooperation from many businesses, celebrities, universities, international organisations and mass media who all have an important voice in reaching and influencing the community.”

The Great Barrier Reef is home to over 1,500 species of fish. Credit: Mauricio Ramos/IPS

Mining and port development coupled with decreasing water quality along Australia’s north-eastern coast are threatening the continent’s World Heritage-listed tourist drawcard, the Great Barrier Reef.

An assessment report of the reef by the United Nations Educational, Scientific and Cultural Organisation (UNESCO) and the International Union for Conservation of Nature (IUCN) has said the lack of “firm and demonstrable commitment” by either the Australian federal or the Queensland state government to limit port developments near the reef “represents a potential danger to the outstanding universal value of the property.”

Spread across an area of 348,000 square kilometres, the Great Barrier Reef includes about 2,500 individual reefs and over 900 islands and is home to breeding colonies of seabirds and marine turtles, snubfin dolphins and the humpback whale.

“With a number of major development (projects) coming up for approval in the coming weeks and months, the Australian government is playing a risky game if it continues to approve them because it may force the World Heritage committee to place the reef on their list of shame,” World Wildlife Fund (WWF) Spokesman Richard Leck told IPS.

Since 2011, UNESCO and the IUCN have expressed serious concerns about the management of the world heritage area.

“Australia has clearly ignored the recommendations. The federal government continues to approve new developments with no long-term commitment to restricting industrialisation to the existing footprint. The Queensland government has also weakened some of the laws that protect the reef from development and land clearing,” Leck told IPS.

WWF estimates that the clearing of tens of thousands of hectares of vegetation along rivers leading to the reef, and allowing dredge spoil to be dumped in coastal waters will have a significant impact on the protected site, which contains 400 types of coral, 1,500 species of fish, 4,000 types of mollusc, about 240 species of birds, and several sponges, anemones, marine worms and crustaceans.

The reef waters also provide major feeding grounds for threatened species, and hosts one of the world’s largest populations of the dugong.

According to Australian Marine Conservation Society’s Great Barrier Reef Campaign Director Felicity Wishart, “The development of port infrastructure and increased shipping movements require the dredging of millions of tonnes of seabed, often seagrass meadows which are the breeding and feeding areas for turtles, dugongs and other marine life.

“The sediments stirred up during dredging can travel tens of kilometres away, settling on coral ecosystems and plant life. This can damage or destroy vital wetlands, fish breeding grounds and other coastal habitats,” Wishart told IPS.

Moreover, environmentalists are concerned that increased shipping will aggravate the risk of oil spills in the reef. About 4,000 ships plow the Great Barrier Reef annually and this number is expected to grow to 6,000 ships by 2020.

To protect the healthiest and most pristine section of the reef from terrestrial threats, especially new ports and mining development, The Wilderness Society is seeking a World Heritage nomination for the Cape York Peninsula, located on the northern tip of Queensland.

“This would rule out the Balkanu Corporation’s Wongai coalmine proposal, which would open up new areas to development, and Rio Tinto’s South of Embley bauxite mine, which would require 900 shipping movements through the reef between the Weipa mine and the processing facility at Gladstone,” Gavan McFadzean, Wilderness Society’s northern Australia campaigner, told IPS.

According to projections by the Bureau of Resource and Energy Economics, coal exports from Australia, already the world’s leading exporter, will roughly double in a little over a decade. Over the past 10 years black coal exports have increased by more than 50 percent. Major Asian economies like Japan, China, the Republic of Korea, India and Taiwan account for 88 percent of all black coal exports.

Greenpeace Senior Campaigner Dr. Georgina Woods summed up the situation with a simple question: “Will we sacrifice the Great Barrier Reef and accept dangerous climate change as the inevitable cost of propping up just one industry?”

Research commissioned by Greenpeace estimates Australia’s coal export expansion is the second biggest of 14 proposed fossil fuel enterprises that will push the world beyond agreed global warming limits. Coral reefs around the world are unlikely to survive if global temperatures increase by 1.5 degrees. “Right now, we’re heading decisively for four degrees of warming,” Woods told IPS.

CEO of the Sydney-based Climate Institute, John Connor, warned that the Great Barrier Reef is under threat from climate change, both from ocean acidification and from increasingly severe storms, but said Australia had taken some important steps to reduce emissions by putting in place the necessary carbon laws.

“Australia’s carbon price mechanism regulates emissions by limiting them not just pricing them. It will reduce at least 12 million tonnes of carbon pollution a year and has the potential to reduce 1.1 billion tonnes by 2020,” Connor told IPS.

Prime Minister Julia Gillard’s Labour Government has also announced it will pour 27 million dollars into improving the quality of water flowing into the Great Barrier Reef lagoon. It will help reduce the run-off from farms causing coral bleaching and algae growth, which smothers seagrass beds and coral reefs.

Larissa Waters, senator for the Australian Greens, has introduced a bill in the Senate to adopt the World Heritage committee’s key recommendations and she is calling on both the Liberal and the Labour Party to support it.

“The government must stop putting the interests of big mining companies ahead of the reef and place a moratorium on all further developments until the joint government strategic assessment is finished in 2015 and also stop allowing new ports in pristine areas,” Waters told IPS.

Experts are worried about the economic impact of destruction to the reef, which contributes 822 million dollars a year to the national economy and supports about 60,000 jobs. Recent polling shows that 91 percent of Australians think protecting the reef is the most important environmental issue in 2013.

Egyptians queue for subsidised bread amid steadily rising commodity prices. Credit: Khaled Moussa al-Omrani/IPS

Regardless of who is responsible for Egypt’s current political impasse – be it the administration of Islamist president Mohamed Morsi or an aggressive secular opposition – local experts are certain of at least one fact: Egypt’s dire economic circumstances will not improve without political stability.

“Egypt’s economic situation is intrinsically tied to the political one,” economic analyst Hamdi Abdel-Azim told IPS. “Economic stability cannot be achieved amid the turbulence and uncertainty, which for months has characterised Egypt’s political scene.”

Upon assuming the presidency last year, Morsi, Egypt’s first freely elected head of state, inherited a host of long-term economic challenges from his predecessor, ousted president Hosni Mubarak.

Chronically high rates of poverty and unemployment, deteriorating public services and infrastructure, an ever-widening state budget deficit, high foreign debt and mounting disparities between rich and poor are just a few of the issues that Mubarak’s regime failed to solve after three decades in power.

Abdel-Azim cited “mismanagement and corruption” as part of the reason for these problems. Still, the country’s economic position “has worsened considerably” in the nine months since Morsi, who hails from Egypt’s Muslim Brotherhood, took highest office, he added.

Within this period, according to Abdel-Azim, the Egyptian pound has declined in value against the dollar, while Egypt’s foreign currency reserves have fallen considerably. Domestic debt has also risen to roughly 187 billion U.S. dollars. “Numerous local companies have been forced out of business, swelling the ranks of the unemployed,” the analyst added.

Egypt’s tourism sector, meanwhile, long considered one of the country’s chief sources of foreign currency, continues to reel from the cumulative effects of long-term political instability.

Since May 2011, Egypt has been negotiating a 4.8-billion-dollar loan from the International Monetary Fund. The proposed loan, however, will be contingent upon a raft of difficult economic reforms, including major subsidy reductions and tax increases.

Egypt’s political opposition, led by the National Salvation Front (NSF), an umbrella grouping of various opposition parties and movements, has been quick to blame President Morsi for the country’s ongoing economic woes.

“Morsi and the Muslim Brotherhood are responsible for Egypt’s deteriorating economy,” Amr Hamzawy, former MP and a leading NSF member, said in April. “The government is pushing through economic laws without consulting other political forces, while Egypt’s poor are paying the price for the Morsi administration’s failures.”

Some elements of the opposition have limited their demands to a handful of constitutional changes, a cabinet reshuffle and the dismissal of Egypt’s Morsi-appointed prosecutor-general. Others, however, have gone so far as to demand that Morsi step down in advance of snap presidential elections.

Within the last five months, the NSF-led opposition has organised numerous demonstrations and marches, many of which have ended in violence. The Muslim Brotherhood, for its part, blames Egypt’s faltering economy on the opposition’s more extremist elements, whose endless calls for strikes and protests have resulted only in further destabilisation.

“The main reason for worsening economic conditions is the insistence by the opposition – especially the NSF – on inflaming the political situation by encouraging violent demonstrations, thus further destabilising the country,” Murad Ali, spokesman for the Muslim Brotherhood’s Freedom and Justice Party, told IPS.

“In his trips abroad, President Morsi has tried to attract foreign investment to Egypt in hopes of bolstering the economy and realising longstanding demands for social justice,” Ali added. “But these efforts have largely failed to bear fruit due to perpetual domestic political instability, which has been consistently encouraged by the opposition.”

Local captains of industry, meanwhile, warn that Egypt’s economic prospects will remain dim indeed if the political situation does not settle down.

“Failure to resolve the current political impasse will eventually lead to the destruction of Egypt’s tourism industry,” Ilaham al-Zayat, head of the Union of Egyptian Chambers of Tourism, told IPS. “The steadily declining tourist numbers that Egypt has suffered since the [2011] revolution will eventually drive local tourism companies out of business.”

“Without a degree of long-term political stability,” he added, “tourist numbers will never return to pre-revolution levels.”

Gamal Eddin Bayoumi, secretary-general of the Cairo-based Union of Arab Investors, agreed with al-Zayat’s general assertion.

“Egypt’s economic deterioration cannot be stopped without an end of the current state of political uncertainty,” Bayoumi told IPS. “No investor will put his money in a country perceived to be unstable or which lacks state institutions that can guarantee the future of his investments.”

Abdel-Azim blames the ongoing political crisis on both the presidency and the secular opposition.

“The Morsi administration has taken a number of poor decisions without considering their long-term effects, while the president’s economic advisors have lacked adequate qualifications,” he said. “The opposition, meanwhile, doesn’t want to accept the results of Egypt’s first democratic presidential elections, which brought Morsi to power.”

On May 7, in an effort to placate critics, Morsi replaced nine government ministers, including those responsible for sensitive economic portfolios – finance, investment, planning and international cooperation, petroleum and agriculture. Notably, most new cabinet appointees are either Muslim Brotherhood members or sympathisers.

Opposition spokesmen blasted Tuesday’s cabinet reshuffle. “These changes don’t amount to anything,” Amr Moussa, a leading NSF member and head of the liberal Conference Party, said. “Another cabinet shake-up will be necessary before long.”

Even though the reshuffle included the heads of strategic economy-related ministries, “the changes fail to meet opposition demands for a more inclusive government,” said Abdel-Azim. “This will only make resolution of Egypt’s dire economic problems all the more difficult.”