Inter Press Service » G20 http://www.ipsnews.net News and Views from the Global South Thu, 08 Dec 2016 09:56:56 +0000 en-US hourly 1 http://wordpress.org/?v=4.1.13 U.S. and China Formally Join Paris Agreement in Show of Unityhttp://www.ipsnews.net/2016/09/u-s-and-china-formally-join-paris-agreement-in-show-of-unity/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-and-china-formally-join-paris-agreement-in-show-of-unity http://www.ipsnews.net/2016/09/u-s-and-china-formally-join-paris-agreement-in-show-of-unity/#comments Sat, 03 Sep 2016 20:05:11 +0000 Guy Dinmore http://www.ipsnews.net/?p=146770 The joint move by the U.S. and China, which account for nearly 40 percent of global carbon emissions, paves the way for the Paris Agreement forged last December to enter into force. Credit: Bigstock

The joint move by the U.S. and China, which account for nearly 40 percent of global carbon emissions, paves the way for the Paris Agreement forged last December to enter into force. Credit: Bigstock

By Guy Dinmore
HONOLULU, Hawaii, Sep 3 2016 (IPS)

The world’s super-polluters – the United States and China – have formally joined the Paris Agreement on climate change in a symbolic show of unity.

At a ceremony in the eastern Chinese city of Hangzhou, where China is hosting a summit of G20 industrialised nations, President Barack Obama and President Xi Jinping handed their documents of ratification to UN Secretary-General Ban Ki-moon.In contrast to the excitement in Honolulu among the world’s leading environmental activists and scientists, the announcement that Obama had used his executive authority to accede to the Paris Agreement was widely ignored by the major U.S. networks.

The joint move by the U.S. and China, which account for nearly 40 percent of global carbon emissions, paves the way for the Paris Agreement forged last December to enter into force, most likely by the end of the year. For the agreement to enter into effect and start to be implemented, at least 55 countries representing at least 55 percent of global emissions need to formally join.

The UN Secretary General praised Obama for his “inspiring” leadership. He said Obama and Xi had both been “far-sighted, bold and ambitious”.

The joint accession by the world’s biggest polluters was enthusiastically welcomed in Honolulu where the International Union for Conservation of Nature, which groups governments and NGOs, is holding a key congress that aims to chart the future path for stopping the planet’s slide into environmental ruin.

“This is a momentous event,” Xavier Sticker, France’s ambassador for the environment, said of the ratification by the U.S. and China. He told IPS it was expected to pave the way for many other countries to follow. But he cautioned that the European Union needs to accede as a bloc and that the internal complexities of national political systems could lead to delays. Belgium requires the assent of seven legislative assemblies, for example. France has already ratified but the UK has not.

Delegates at the IUCN World Conservation Congress warned that there was a risk for the European Union that the Paris Agreement implementation taskforce would be formed next month without EU involvement.

Patricia Espinosa, head of the UN Framework Convention on Climate Change, urged IUCN delegates representing the global conservation community to lobby governments on what must be done to achieve the Paris Agreement targets on emissions and limiting the rise of global temperatures.

“We are very excited about this good news, for the early entry into force of the Paris Agreement. No one had imagined it would be this year,” she said shortly before official confirmation arrived from Hangzhou.

In contrast to the excitement in Honolulu among the world’s leading environmental activists and scientists, the announcement that Obama had used his executive authority to accede to the Paris Agreement was widely ignored by the major US networks in their news bulletins. Ironically, however, there was considerable coverage of Tropical Storm Hermine moving up the east coast of the U.S. on Labour Day weekend, possibly turning back into hurricane force, and also of Hurricane Lester brushing past Hawaii.

“We are here together because we believe that for all the challenges that we face, the growing threat of climate change could define the contours of this century more dramatically than any other challenge,” Obama said in a speech in Hangzhou.

“And someday we may see this as the moment that we finally decided to save our planet,” he added. “There are no shortage of cynics who thought the agreement would not happen. But they missed two big things: The investments that we made to allow for incredible innovation in clean energy, and the strong, principled diplomacy over the course of years that we were able to see pay off in the Paris Agreement. The United States and China were central to that effort. Over the past few years, our joint leadership on climate has been one of the most significant drivers of global action,” Obama said.

Xi was reported as calling the Paris Agreement a milestone that marks the “emergence of a global government system” for climate change. “Our response to climate change bears on the future of our people and the well-being of mankind,” China’s president said.

The accession of China and the U.S. bring to 25 the number of countries to have ratified so far. Diplomatic pressure is expected to be ramped up on other major polluters, such as India and Russia.

But scientists and activists are warning that the Paris Agreement target of keeping temperature rises “well below” 2 degrees centigrade, with a soft target of 1.5 degrees, is already on its way to being breached as the world records a succession of the hottest months on record.

“What’s needed is comprehensive and urgent action now to slash emissions and build a low-carbon future,” Friends of the Earth commented.

The Paris Agreement also provides for 100 billion dollars a year in climate finance for developing countries by 2020, with a commitment to further finance in the future.

The U.S. and China have set widely differing targets on carbon emissions, because of their different stages of economic development. The U.S. plans over the next 10 years to reduce emissions by over a quarter below the level of 2005, while China says it intends to stop increasing its emissions by 2030.

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Beyond Rhetoric: UN Member States Start Work on Global Goalshttp://www.ipsnews.net/2016/07/beyond-rhetoric-un-member-states-start-work-on-global-goals/?utm_source=rss&utm_medium=rss&utm_campaign=beyond-rhetoric-un-member-states-start-work-on-global-goals http://www.ipsnews.net/2016/07/beyond-rhetoric-un-member-states-start-work-on-global-goals/#comments Fri, 22 Jul 2016 17:05:23 +0000 Lyndal Rowlands http://www.ipsnews.net/?p=146182 Ministerial Segment of the High-level Political Forum on Sustainable Development Goals. Credit: UN Photo/Manuel Elias.

Ministerial Segment of the High-level Political Forum on Sustainable Development Goals. Credit: UN Photo/Manuel Elias.

By Lyndal Rowlands
UNITED NATIONS, Jul 22 2016 (IPS)

UN member states “are going beyond rhetoric and earnestly working to achieve real progress” towards the Sustainable Goals, the members of the Group of 77 and China said in a ministerial statement delivered here on 18 July.

The statement was delivered by Ambassador Virachai Plasai, Chair of the Group Of 77 (G77) and China during the High Level Political Forum (HLPF) which took place at UN Headquarters in New York from 18 to 20 July.

During the forum, the 134 members of the G77 and China reaffirmed the importance of not only achieving the Sustainable Development Goals but also the driving principle of leaving no one behind.

“We must identify the “how” in reaching out to those furthest behind,” said Plasai who is also Ambassador and Permanent Representative of the Kingdom of Thailand to the UN.

“To make this real, we cannot simply reaffirm all the principles recognised in the (2030) Agenda, including the principle of common but differentiated responsibilities, but must earnestly implement them in all our endeavours,” Plasai added.

The UN’s 193 member states unanimously adopted the 2030 Development Agenda, including the 17 Sustainable Development Goals, in September 2015. The goals reflect the importance of the three aspects of sustainable development: economic, social and environmental, and countries will work towards achieving them by the year 2030.

However more still needs to be done to ensure that developing countries have access to the resources they need to meet the goals, said Plasai.

“We reiterate that enhancing support to developing countries is fundamental, including through provision of development financial resources, transfer of technology, enhanced international support and targeted capacity-building, and promoting a rules-based and non-discriminatory multilateral trading system,” he said.

“To make this real, we cannot simply reaffirm all the principles recognised in the (2030) Agenda... but must earnestly implement them in all our endeavours." -- Ambassador Virachai Plasai

“We urge the international community and relevant stakeholders to make real progress in these issues, including through the G20 Summit in China which will focus on developing action plans to support the implementation of the 2030 Agenda.”

At a separate meeting during the High Level Political Forum the G77 and China noted some of the specific gaps that remain in financing for development.

During that meeting the G77 and China expressed concern that rich countries are failing to meet their commitments to deliver Official Development Assistance (ODA) – the official term for aid – to developing countries.

“We note with concern that efforts and genuine will to address these issues are still lagging behind as reflected in this year’s outcome document of the Financing for Development forum which failed to address (gaps in ODA),” said Chulamanee Chartsuwan, Ambassador and Deputy Permanent Representative Of The Kingdom of Thailand to the UN, on behalf of the Group of 77 and China.

Speaking during the forum on July 19, UN Secretary-General Ban Ki-moon underscored the importance of the High Level Political Forum, “as the global central platform for follow-up and review of the Sustainable Development Goals.”

Ban presented the results of the first Sustainable Development Goals report released by the UN Department of Economic and Social Affairs on July 20. The report used “data currently available to highlight the most significant gaps and challenges” in achieving the 2030 Agenda, said Ban.

“The latest data show that about one person in eight still lives in extreme poverty,” he said.

“Nearly 800 million people suffer from hunger.”

“The births of nearly a quarter of children under 5 have not been recorded.”

“1.1 billion people are living without electricity, and water scarcity affects more than 2 billion.”

Leaving No One Behind

Ban also noted that the importance of collecting data about the groups within countries that are more likely to be “left behind”, such as peoples with disabilities or indigenous peoples.

Collecting separate data about how these groups fare is considered one way for governments to help achieve Sustainable Development Goal 10 which aims to decrease inequality within countries.

However SDG 10 also aims to address inequalities between countries, an important objective for the G77, as the main organisation bringing together developing countries at the UN the G77 wants to make sure that countries in special circumstances are not left behind.

Countries in special circumstances include “in particular African countries, least developed countries, landlocked developing countries and Small Island Developing States, as well as countries in conflict and post-conflict situations,” said Chartsuwan.

However while the world’s poorest and most fragile countries have specific challenges, many middle income countries also have challenges too, the G77 statement noted.

Climate Change Agreement Needs Implementation

Developing countries, and particularly countries with special circumstances, are among those that are most adversely affected by climate change, and therefore wish to see speedy adoption and implementation of the Paris Climate Change Agreement alongside the 2030 Agenda.

Ban told the forum that he will host a special event during the UN General Assembly at 8am on September 21 for countries to deposit their instruments of ratification.

“We have 178 countries who have signed this Paris Agreement, and 19 countries have deposited their instrument of ratification.”

“As you are well aware, we need the 55 countries to ratify, and 55 percent of global greenhouse gas emissions accounted.”

“These 19 countries all accounted is less than 1 percent of greenhouse gas emissions.”

“So we need to do much more,” he said.

The G77 Newswire is published with the support of the G77 Perez-Guerrero Trust Fund for South-South Cooperation (PGTF) in partnership with Inter Press Service (IPS).

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Refugee Crisis May Threaten Development Aid to World’s Poorhttp://www.ipsnews.net/2015/11/refugee-crisis-may-threaten-development-aid-to-worlds-poor/?utm_source=rss&utm_medium=rss&utm_campaign=refugee-crisis-may-threaten-development-aid-to-worlds-poor http://www.ipsnews.net/2015/11/refugee-crisis-may-threaten-development-aid-to-worlds-poor/#comments Wed, 11 Nov 2015 21:52:23 +0000 Thalif Deen http://www.ipsnews.net/?p=142974 By Thalif Deen
UNITED NATIONS, Nov 11 2015 (IPS)

As the spreading refugee crisis threatens to destabilize national budgets of donor nations in Western Europe, Secretary-General Ban Ki-moon Wednesday appealed to the international community not to forsake its longstanding commitment for development assistance to the world’s poorer nations.

Ban’s appeal comes two days after a UN pledging conference reported a “dramatic decline” in donor commitments: from 560 million dollars in 2014 to 77 million dollars in the most recent pledges, largely covering 2015.

Asked if the Secretary-General’s appeal was the result of the decline in commitments, UN Deputy Spokesman Farhan Haq told IPS: “It’s in response to many factors, including concerns expressed by some states about maintaining aid levels.”

The secretary-general said resources for one area should not come at the expense of another.

Redirecting critical funding away from development aid at this pivotal time could perpetuate challenges that the global community has committed to address, he warned.

“Reducing development assistance to finance the cost of refugee flows is counter-productive and will cause a vicious circle detrimental to health, education and opportunities for a better life at home for millions of vulnerable people in every corner of the world,” Ban declared.

At a summit meeting of political leaders from Europe and Africa in Malta Wednesday, the European Union (EU) was expected to announce plans to create a Special Trust Fund, initially estimated at 1.9 billion dollars, to address the financial problems arising out of the refugee crisis.

Since European countries are expected to boost this fund over the next few months, there are fears these contributions may be at the expense of development assistance.

According to figures released by the Paris-based Organisation for Economic Cooperation and Development (OECD), development aid flows were stable in 2014, after hitting an all-time high in 2013.

But aid to the poorest countries continued to fall, according to official data collected by the OECD Development Assistance Committee (DAC).

Net official development assistance (ODA) from DAC members totalled 135.2 billion dollars, with a record 135.1 billion dollars in 2013, though marking a 0.5% decline in real terms.

Net ODA as a share of gross national income was 0.29%, also on a par with 2013. ODA has increased by 66% in real terms since 2000, when the Millennium Development Goals were agreed, according to OECD.

The secretary-general said that with the world facing the largest crisis of forced displacement since the Second World War, the international community should meet this immense challenge without lessening its commitment to vitally needed official development assistance. (ODA)

He underscored the importance of fully funding both efforts to care for refugees and asylum seekers in host countries as well as longer-term development efforts.

The Secretary-General said he recognized the financial demands faced by host communities and partner governments as they seek to support the international response.

He expressed his “sincere gratitude to governments and their citizens for their generosity.”

Nick Hartmann, Director of the Partnerships Group at UN Development Programme (UNDP) told delegates Monday the important agreements that Member States had come to in 2015 called for increased policy support.

To deliver that, adequate and predictable resources were required.

He said core resources were the foundation of UNDP’s support to the poorest and most vulnerable.

UNDP, he pointed out, had responded to a range of crises over the past year and had ensured that 11.2 million people benefited from improved livelihoods. Almost a million jobs were created in 77 countries, with half of those reaching women.

“However, he said reduced contributions from many top partners and unfavourable exchange rate movements had caused a downward trend in funding.”

Hartmann said a number of partners faced overwhelming pressures, including the migrant crisis, he thanked those who had submitted pledges at Monday’s pledging conference.

The UNDP is described as the UN’s global development network covering 177 countries and territories.

The writer can be contacted at thalifdeen@aol.com

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Is Good Governance Good For Development?http://www.ipsnews.net/2015/09/is-good-governance-good-for-development/?utm_source=rss&utm_medium=rss&utm_campaign=is-good-governance-good-for-development http://www.ipsnews.net/2015/09/is-good-governance-good-for-development/#comments Mon, 14 Sep 2015 15:43:23 +0000 Jomo Kwame Sundaram http://www.ipsnews.net/?p=142365 Jomo Kwame Sundaram. Credit: FAO

Jomo Kwame Sundaram. Credit: FAO

By Jomo Kwame Sundaram
ROME, Sep 14 2015 (IPS)

Many well-meaning people who would like better governance have been misled into insisting on so-called ‘good governance’ reforms, with the expectation that this would lead to development.

There is no clear or systematic evidence that good governance – as an approach — is necessary for development. However, the evidence favours the converse: governance improves with development.

No one is advocating bad governance, or corruption, or however one wants to define whatever good governance is meant to address. Nor is anyone saying that governance does not matter.

Clearly, no one is opposed to good governance in the sense of governance that is good. On the contrary, everyone wants to improve governance in many aspects of human affairs.

When the policy prescriptions of the conventional wisdom of the last three decades did not result in sustained development, good governance reforms became the great hope. After all, the statistical correlation between good governance indicators and economic performance has long fuelled hope that good governance would bring development.

Thus, good governance became a convenient way to explain away the failure of the development economics orthodoxy of the last two decades of the 20th century — when Latin America lost more than a decade, and Sub-Saharan Africa a quarter century due to enforcement of the so-called ‘Washington Consensus’!

Market liberalization was supposed to be the necessary complement of freedom and democracy — following the late Friedrich Hayek and Milton Friedman, both Nobel laureates in economics with considerable name recognition.

Thus, good governance was touted as the great miracle cure for development failure and corruption, usually simplistically attributed to big government. After all, who favours corruption, red-tape or ineptitude?

These were easy targets, and when conventional analysis could not explain development failures and corruption, bureaucracy, bad governance and governance failure could conveniently be blamed.

But unfortunately, all good things in life do not necessarily go together. And while most people want democracy, or want to see an end to corruption, development does not necessarily follow. And that is the problem.

Unfortunately, unrealistic expectations have been created by presuming that good governance reforms are necessary for development. When good governance reforms are imposed as aid conditionalities, recipient developing country governments often end up mimicking donor expectations.

And when you have well over a hundred good governance indicators, reforms become so wide-ranging, impossible to achieve, beyond the means of most developing countries and, worst of all, a major distraction from needed development efforts.

To make things worse, many ostensible good governance solutions favour particular vested interests, with grossly unfair consequences. Also, many good governance reforms have had unexpected, if not perverse outcomes, sometimes worsening governance problems, e.g. when decentralization and devolution have led to powerful local political patrons — which some call ‘cacique’ democracy.

So, let us improve governance by all means. But let us not overload the governance reform agenda unnecessarily. As Harvard Professor Merilee Grindle has put it, we need ‘good enough’ governance — meaning we must prioritize, and strategically.

There is no systematic evidence that the much touted good governance reforms are necessary for development. We cannot presume that the advocates of good governance have been always right about how best to improve governance.

Take the claims about the ostensible necessity to strengthen property rights.

In reality, the tragedy of the commons is not inevitable, and strengthened property rights are not the only solution. The late, much maligned Nobel laureate Elinor Ostrom showed that human societies have long coped with ecological, resource and other constraints with a variety of arrangements other than by strengthening property rights.

As governance improves with development, let us prioritize development-enhancing governance reforms, or developmental governance. A pragmatic approach to improving governance cannot be dogmatic, pre-conceived, and one-size-fits-all, where one has the solution even before one knows the problem.

Identify the major constraints, analyse, and then address them, perhaps sequentially. Draw from relevant experiences, lessons learned. Do not presume there are best practices regardless of context. We need to be humble, not presumptuous, and that is never easy for those of us deemed experts.
(END)

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G20 Finance Ministers Committed to Sustainable Developmenthttp://www.ipsnews.net/2015/09/g20-finance-ministers-committed-to-sustainable-development/?utm_source=rss&utm_medium=rss&utm_campaign=g20-finance-ministers-committed-to-sustainable-development http://www.ipsnews.net/2015/09/g20-finance-ministers-committed-to-sustainable-development/#comments Wed, 09 Sep 2015 22:32:33 +0000 Jaya Ramachandran http://www.ipsnews.net/?p=142339 The Finance Ministers and Central Bank Governors of the G20. Credit: TCMB/cc by 2.0

The Finance Ministers and Central Bank Governors of the G20. Credit: TCMB/cc by 2.0

By Jaya Ramachandran
BERLIN, Sep 9 2015 (IPS)

Finance ministers and central bank governors of the world’s 20 major economies, accounting for 66 percent of world population, have pledged to “promote an enabling global economic environment for developing countries as they pursue their sustainable development agendas”.

In this context, they are looking forward to “a successful outcome” of the U.N. Summit in New York for the adoption of the 2030 Agenda for Sustainable Development. The summit will be held from Sep. 25 to 27 in New York as a high-level plenary meeting of the General Assembly of the world body.

The G20, meeting in Turkey’s capital Ankara on Sep. 4-5, reviewed ongoing economic developments, their respective growth prospects, and recent volatility in financial markets and its underlying economic conditions. They welcomed “the strengthening economic activity in some economies” but said that global growth was falling short of their expectations.

To remedy the situation, they vowed to take decisive action to keep the economic recovery on track and expressed confidence that the global economic recovery would gain speed. With this in view, they would continue to monitor developments, assess spillovers and address emerging risks as needed to foster confidence and financial stability.

The G20 welcomed “the positive outcomes of the Addis Ababa Conference on Financing for Development (FFD)”. In support of these, they aim to scale up their technical assistance efforts to help developing countries build necessary institutional capacity, particularly in the areas specified in the Addis Ababa Action Agenda.

The agreement was reached by the 193 U.N. Member States attending the Conference, following negotiations under the leadership of Ethiopian Foreign Minister Tedros Adhanom Ghebreyesus.

U.N. Secretary-General Ban Ki-moon said: “This agreement is a critical step forward in building a sustainable future for all. It provides a global framework for financing sustainable development.”

He added, “The results here in Addis Ababa give us the foundation of a revitalized global partnership for sustainable development that will leave no one behind.”

The G20 includes 19 individual countries – Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom and the United States – along with the European Union (EU). The EU is represented by the European Commission and by the European Central Bank.

The Group was founded in 1999 with the aim of studying, reviewing, and promoting high-level discussion of policy issues pertaining to the promotion of international financial stability.

It seeks to address issues that go beyond the responsibilities of any one organisation. Collectively, the G20 economies account for around 85 percent of the gross world product (GWP), 80 percent of world trade (or, if excluding EU intra-trade, 75 percent), and two-thirds of the world population. The G20 heads of government or heads of state have periodically conferred at summits since their initial meeting in 2008.

The G20 are responsible for 84 percent fossil fuel emissions worldwide. To support the climate change agenda of 2015, they welcomed the Climate Finance Study Group (CFSG) report, took note of the inventory on climate funds developed by the OECD (Organisation for Economic Cooperation and Development), and the toolkit developed by the OECD and the GEF (Global Environment Facility) to enhance access to adaptation finance by the low income and developing countries, especially those that are particularly vulnerable to the adverse effects of climate change.

While recognising developed countries’ ongoing efforts, they called on them to continue to scale up climate finance in line with their commitments.

“We are working together to reach a positive and balanced outcome at the 21st Conference of Parties of the UNFCCC (COP 21). Based on the outcomes and towards the objectives of the COP21, CFSG will continue its work in 2016 by following the principles, provisions and objectives of the UNFCCC,” they added.

UNFCC is the United Nations Framework Convention on Climate Change that emerged from the Earth Summit in June 1992 in Rio, Brazil, which is currently the only international climate policy treaty with broad legitimacy, due in part to its virtually universal membership.

The CFSG was established by Finance Ministers, in April 2012, and was welcomed by leaders in the Los Cabos Summit, in Jun 2012, with a view “to consider ways to effectively mobilize resources taking into account the objectives, provisions and  principles of the UNFCCC”.

In November 2012, Finance Ministers agreed to “continue working towards building a better understanding of the underlying issues among G20 members taking into account the objectives, provisions and principles of the UNFCCC”, and also recognised that the “UNFCCC is the forum for climate change negotiations and decision making at the international level”.

Following the mandate of the group, and building on the CFSG 2013 Report, the Group identified four areas to be studied in 2014, namely: (a) Financing for adaptation; (b) Alternative sources and approaches to enhance climate finance and its effectiveness; (c) Enabling environments, in developing and developed countries, to facilitate the mobilization and effective deployment of climate finance; (d) Examining the role of relevant financial institutions and MDBs in mobilizing climate finance.

This report aims to present to the G20 Finance Ministers and Leaders a range of non-exhaustive policy options (“toolbox”) for voluntary consideration, related to these four areas, and to suggest further work on other important issues on climate finance.

The G20 said they were “deeply disappointed” with the continued delay in progressing the 2010 International Monetary Fund (IMF) Quota and Governance Reforms. In their view, their earliest implementation is essential for the credibility, legitimacy and effectiveness of the Fund and “remains our highest priority”.

As part of continuing efforts to promote market confidence and business integrity, G20 Finance Ministers also endorsed a new set of G20/OECD corporate governance principles.

The G20/OECD Principles of Corporate Governance provide recommendations for national policymakers on shareholder rights, executive remuneration, financial disclosure, the behaviour of institutional investors and how stock markets should function.

Sound corporate governance is seen as an essential element for promoting capital-market based financing and unlocking investment, which are keys to boosting long-term economic growth.

“In today’s global and highly interconnected world of business and finance, creating trust is something that we need to do together,” OECD Secretary-General Angel Gurría said during a presentation of the new Principles with Turkish Deputy Prime Minister Cevdet Yilmaz,‎ who chaired the G20 finance ministers meeting.

Edited by Kitty Stapp

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Opinion: G20 Turkish Presidency Keen to Benefit the Global Communityhttp://www.ipsnews.net/2015/06/opinion-g20-turkish-presidency-keen-to-benefit-the-global-community/?utm_source=rss&utm_medium=rss&utm_campaign=opinion-g20-turkish-presidency-keen-to-benefit-the-global-community http://www.ipsnews.net/2015/06/opinion-g20-turkish-presidency-keen-to-benefit-the-global-community/#comments Sun, 07 Jun 2015 17:05:43 +0000 Selim Yenel http://www.ipsnews.net/?p=141016 Ambassador Selim Yenel. Credit: Permanent Delegation of Turkey to the EU

Ambassador Selim Yenel. Credit: Permanent Delegation of Turkey to the EU

By Selim Yenel
BRUSSELS, Jun 7 2015 (IPS)

Turkey assumed the Presidency of the Group of 20 (G20) on Dec. 1, 2014. It will culminate in the Antalya Summit on Nov. 15-16. Our priorities build upon the G20 multi-year agenda, but also reflect particular themes we see as important for 2015.

(The G20 comprises a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85 per cent of global gross domestic product and over 75 per cent of global trade. They include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States and the European Union.)We have a moral obligation to address inequality, which also hinders economic growth.

We want to channel the influence of the G20 also for the benefit of the global community. Spain, Azerbaijan, Singapore and the Chairs of ASEAN (Malaysia), African Union (Zimbabwe) and NEPAD-New Partnership for Africa’s Development (Senegal) are invited to G20 meetings.

We have an ambitious agenda, a clear focus and an intense work plan. We frame our priorities as ‘3 Is’. – Implementation, Inclusiveness, Investment.

Implementation:

– Turning words into actions. Implementing our collective G-20 commitments.

– G20 members committed themselves to policy measures over 1,000 in total, estimated to lift collective G20 growth by an additional 2.1 percent over the next five years. (the so-called “2 in 5” target)

– The IMF and OECD calculate that implementing G20 growth strategies can generate additional two trillion dollars to the world economy, an output equivalent to the size of the Indian economy.

– The first accountability report on how much progress we have collectively made towards our growth target will be presented to the G20 Summit in Antalya.

Inclusiveness:

– The G20’s overarching aim has been to foster strong, sustainable and balanced growth. One of our primary goals is to add “inclusive” growth to this, both at the national and international level.

– We have a moral obligation to address inequality, which also hinders economic growth. It has been worsened by the effects of the global financial crisis. (Among OECD countries, inequality is at its highest level in 30 years)

– Last year, the G20 made a commitment to reduce the gender gap in labour force participation by 25 percent until 2025 (our 25 by 25 target). Its implementation will bring additional 100 million women into the workforce.

– We will strive to achieve a collective G20 target for youth unemployment.

– SMEs (small and medium enterprises) are another important element. They are the powerhouse of employment, innovation and entrepreneurial spirit.

– We launched the World SME Forum (WSF) on May 23. Turkey’s Deputy Prime Minister Ali Babacan announced the official launch of this forum, a major new initiative to drive the contributions of SMEs to global economic growth and employment. For the first time, there will now be a united and global voice of SMEs.

– Low Income Developing Countries (LIDCs) are an important focal point. Our message: the G20 is not only concerned about its own interests but its policies should also benefit the entire community, resulting in a better global dialogue.

Investment:

– Investment is key to unlocking growth and generating new jobs.

– The public sector cannot meet the global investment gap alone. Effective public and private sector partnership is a must. Nine out of 10 new jobs are created as a result of private investment.

– We proposed that G20 countries prepare national investment strategies to support their national growth strategies adopted last year. We have started to work on our national investment strategies and plan to have them submitted for the approval of at the Antalya Summit.

2015 is a critical year for shaping the global sustainable development agenda for the future.

We have the Sustainable Development Goals (SDG) Summit in New York in September. It is important that the G20’s decisions and actions strengthen the work of the U.N. (SDGs will follow and expand on the Millennium Development Goals agreed in 2000, due to expire at the end of 2015)

We aim to support the universal nature of the post 2015-development agenda. Our work on food security and nutrition, access to affordable and reliable energy to all, efforts to reduce the gender gap in female labour force participation, skills development and infrastructure are directly relevant to many of the proposed goals and targets.

The main topics of the G20 Agriculture Ministers Meeting on May 8, the second in G20 history (first was in 2011), were developing sustainable food systems and the challenges of food loss and waste.

Some 1.3 billion tonnes of food is lost or wasted each year. If we can reduce food losses and waste to zero, it would give us additional food to feed two billion people.

Our work on energy access in Sub Saharan Africa is another important element of our agenda. We are working in partnership with various African institutions.

Almost one-fifth of the global population still does not have access to electricity. Nearly 2.6 billion people lack access to modern cooking facilities. In Sub-Saharan Africa the problem is most acute. More than 620 million people, out of the region’s total population of 915 million, have no access to electricity.

A high-level conference with the participation of African leaders, investors, private sector and relevant international organisations back to back with the G20 Energy Ministers meeting is also planned. The G20 Energy Ministers Meeting on Oct. 2 will be a first in G20 history.

We are also working closely with the ILO and other international organisations on a range of employment and labour market outcomes.

Trade is an important part of our agenda. Representing 76 percent of world trade, G20 should lead by example in collective work to ensure an open and functioning multilateral trading system.

We are also working to strengthen outreach with engagement groups and non-members. Under our Presidency, G20 countries agreed to establish a new G20 engagement group: The Womens-20, to promote gender inclusive growth and enhance the role of women in business.

We also value direct outreach and dialogue with countries, regional groups and institutions. On Apr. 13, we convened in Washington the first Caribbean Region Dialogue with the G20 Development Working Group together with the Central Bank of Trinidad and Tobago. This was an opportunity to deepen the G20-Caribbean relationship.

Overall, Turkey believes it has a responsibility to use its Presidency of the G20 as a positive influence regarding growth, sustainability and development in all areas. Independent of the G20, Turkey in the last decade has been more and more involved with the African, Caribbean and Pacific (ACP) Group of States.

It has developed its relations in the political, economic, commercial and development fields. Turkey has opened a large number of embassies in all the ACP countries and will continue to increase its contacts in the years to come for a mutually beneficial relationship.

Edited by Ramesh Jaura / Kitty Stapp

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service.

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OPINION: A New Era of Hemispheric Cooperation Is Possiblehttp://www.ipsnews.net/2015/01/opinion-a-new-era-of-hemispheric-cooperation-is-possible/?utm_source=rss&utm_medium=rss&utm_campaign=opinion-a-new-era-of-hemispheric-cooperation-is-possible http://www.ipsnews.net/2015/01/opinion-a-new-era-of-hemispheric-cooperation-is-possible/#comments Sun, 18 Jan 2015 18:34:54 +0000 Luis Almagro http://www.ipsnews.net/?p=138705 Luis Almagro, Minister for Foreign Affairs of Uruguay, addresses the opening of the 16th session of the Human Rights Council, in Geneva, Switzerland. Credit: UN Photo/Jean-Marc Ferré

Luis Almagro, Minister for Foreign Affairs of Uruguay, addresses the opening of the 16th session of the Human Rights Council, in Geneva, Switzerland. Credit: UN Photo/Jean-Marc Ferré

By Luis Almagro
MONTEVIDEO, Jan 18 2015 (IPS)

Two decades after the first Summit of the Americas, a lot has changed in the continent and it has been for the good. Today, a renewed hemispheric dialogue without exclusions is possible.

Back in the mid-1990s, at the time of the Miami summit, it was the time of imported consensus, models of economic and social development exclusively based on the market and its supposed perfect allocation of resources through the invisible hand.Today, all voices count, and if they do not, they will have to. The powerful club of the G8 turned into the G20; still, this is not enough to embrace the new reality of our hemisphere.

Hidden under a development rationale, the greatest wave of privatisation and deregulation took over the continent. The role of the state was reduced to be a facilitator of a process based on the principle of survival of the fittest. Solidarity, equity and justice were all values from the past and poverty a necessary collateral damage.

However, these values were in the top of the minds of the people of the hemisphere, who turned their backs to these policies and instead during the past 15 years, have forcefully supported the alternatives that combine economic growth with social inclusion, broadening opportunities for all citizens.

Economic growth went hand in hand with social inclusion, adding millions to the middle class – which today accounts for 34 percent of Latin Americans – surpassing the number of poor for the first time in the history.

If this was possible it was because governments added to the invisible hand of the market, the very visible hand of the state.

And this took place within the context of the worst post war global financial crisis that led to an unprecedented recession in the United States and Europe, which the latter still strives to leave behind.

Growth with social equity turned out to be the new regional consensus.

Today, this binds the region together.

Today, conditions are present to set up a more realistic cooperation in the Americas, where all members could partner in equal conditions, from the most powerful to the smallest islands in the Caribbean.

Today, nobody holds the monopoly over what works or does not; neither can anybody impose models because the established truths have crashed against reality. While in the 1990s social exclusion in domestic policies and voice exclusion at the international level were two sides of the same token, this in not any longer acceptable.

Today, all voices count, and if they do not, they will have to. The powerful club of the G8 turned into the G20; still, this is not enough to embrace the new reality of our hemisphere.

To the existing bodies, the region has added in this past decade the dynamic UNASUR in South America and CELAC in the Americas, thus leaving the OAS as the only place for dialogue among all countries of the Americas, whether large, medium, small, powerful or vulnerable.

But, governmental or inter-governmental actors by themselves are not the only answer to the problems of today´s world. Non-state actors of the non-governmental world, the private sector, trade unions and social organisations must be part of the process.

Leaders need to interpret the time in order to generate an agenda for progress, but progress that is tangible for people, for citizens, to whom we are accountable to.

Therefore, in a more uncertain international economic environment, we should focus on maintaining and expanding our social achievements and a new spirit of cooperation in the Americas can be instrumental for that.

The Summit of the Americas in Panama, in April 2015, may be the beginning of this new process of confidence building, where all countries can feel they can benefit from a cooperative agenda. This will be a historical moment because this time there will be no exclusions.

The recent good news on the diplomatic front related to the normalisation of diplomatic ties between the U.S. and Cuba and the participation of Cuba in the Summit represent an additional positive signal. Panama deserves the support of the entire region before and during the Summit.

This will be a great opportunity to strengthen democratic values, the defence of human rights, institutional transparency and individual freedoms together with a practical agenda for cooperation for shared prosperity in the Americas.

Edited by Kitty Stapp

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The Future of the Planet and the Irresponsibility of Governmentshttp://www.ipsnews.net/2014/11/the-future-of-the-planet-and-the-irresponsibility-of-governments/?utm_source=rss&utm_medium=rss&utm_campaign=the-future-of-the-planet-and-the-irresponsibility-of-governments http://www.ipsnews.net/2014/11/the-future-of-the-planet-and-the-irresponsibility-of-governments/#comments Fri, 21 Nov 2014 08:23:09 +0000 Roberto Savio http://www.ipsnews.net/?p=137866

In this column, Roberto Savio – founder and president emeritus of the Inter Press Service (IPS) news agency and publisher of Other News – argues that governments are unwilling to take steps to do something concrete to halt climate change because of their incestuous relations with energy corporations and because they are unable – or unwilling – to see beyond their immediate existence.

By Roberto Savio
ROME, Nov 21 2014 (IPS)

Less than a week after everybody celebrated the historical agreement on Nov. 17 between the United States and China on reduction of CO2 emissions, a very cold shower has come from India.

Indian Power Minister Piyush Goyal has declared: “India’s development imperatives cannot be sacrificed at the altar of potential climate change many years in the future. The West will have to recognise we have the needs of the poor”.

This is also a blow to the Asia policy of U.S. President Barack Obama, who came back home from signing the CO2 emissions agreement in Beijing, touting his success on establishing U.S. policy in the region.

Roberto Savio

Roberto Savio

But, more importantly, will give plenty of ammunition to the Republican Congress, which has been fighting climate control on the grounds that the United States cannot engage on climate control unless other major polluters make similar commitments. This was always directed to China, which had refuse to make any such commitment until President Xi, to the surprise of everybody, did so by signing an agreement with Obama.

India is a major polluter, not at the level of China, which has now reached 9,900 metric tons of CO2, against the 6,826 of the United States. But India is coming up fast. “The incestuous relations between energy corporations and governments are out of the public's eye. It is yet further proof that, even when nothing less than survival is at stake for islands and coastlines, agriculture and the poor, governments are unable – or unwilling – to see beyond their immediate existence”

Goyal has promised that India’s use of domestic coal will rise from 565 million tons last year to more than a billion tons by 2019, and he is selling licences for coal mining at a great speed. The country has increased its coal-fired plants by 73 percent in just the last five years. In addition, Indian coal is of poor quality, polluting twice as much as coal in the West.

Nevertheless, newly-elected Indian Prime Minister Narendra Modi has announced that he will embark on a major programme of renewable sources of energy, and there is an apparent paradox in the fact that many of the climate scientists who form the Intergovernmental Panel on Climate Control (IPCC) are from India. Its Director-General is an Indian, Dr. Rajendra K. Pachauri, who is also chief executive of the Energy Resources Institute in New Delhi.

The IPCC’s last report was much more dramatic than previous ones, stating conclusively that climate change is due to the action of man, and providing an extensive review of the damage that the agricultural sector is bound to face, especially in poor countries like India. At least 37 million people would be displaced by rising seas.

Indian towns are by far the most polluted in the world, surpassing several times each year the worst polluted day in China.

But what is more worrying is that governments are reacting too slowly. It would take a very major effort, which is not now on the cards, to keep temperature from rising by more than 2 degrees Centigrade, and therefore to start to reduce emissions by 2020. Emissions in 2014 are expected to be the highest ever, at 40 billion tonnes, compared with 32 billion in 2010.

The consensus is that to limit warming of the planet to no more 2 degrees Centigrade above pre-industrial levels, governments would have to restrict emissions from additional fossil fuel burning to about 1 trillion tons of carbon dioxide.

But, according to the IPCC report, energy companies have booked coal and petroleum reserves equal to several times that amount, and they are spending some 600 billion dollars a year to find more. In other words, governments are directly subsidising the consumption of fossil fuel.

By contrast, less than 400 billion dollars a year are spent to reduce emissions, a figure that is smaller than the revenue of one just one U.S. oil company, ExxonMobil.

The last meeting of the G20 in Brisbane earlier this month gave unexpected attention to climate, but the G20 alone is spending 88 billion dollars a year in subsidies for fossil fuel exploration, which is double that which the top 20 private companies are spending to look for new oil, gas and coal.

The G20 spends 101 billion dollars to support clean energy in a clear attempt to make everybody happy but, according to the International Energy Agency, if G20 governments directed half of their subsidies, or 49 billion dollars a year, to investment for redistributing energy from new sources, we could achieve universal energy access as soon as 2030.

Another good example of the total lack of coherence from Western governments is that they have pledged an amount of 10 billion dollars for a Green Climate Fund, whose task is to support developing countries in mitigating and adapting to climate change. That amount is two-thirds of what those countries have been asking for and, since its creation in 1999, the fund has still to become operational.

And it was only after the last G20 meeting that the United States pledged three billion dollars and Japan 1.5 billion, bringing the total so far to 7 billion dollars – one-third is still missing.

And now we have the upcoming Climate Conference in Lima, in December, where opinion is that governments will once again fail to reach a comprehensive agreement on climate change – and the amount of time left for the planet will reduce even further.

Besides the fight to be expected from the Republican Congress in the United States, there will be also be opposition from countries that depend on fossil fuels, such as Russia, Australia, India, Venezuela, Iran, Saudi Arabia and the Gulf countries.

So, governments show a total lack of consensus and responsibility. If a referendum could be held asking citizens if they would prefer to pay 800 billion dollars less in taxes to avoid subsidising pollution, there are few doubts what the result would be. And there would be same result if they were asked if they would prefer to invest those 800 billion dollars in clean energy or continue to pollute.

But the incestuous relations between energy corporations and governments are out of the public’s eye. It is yet further proof that, even when nothing less than survival is at stake for islands and coastlines, agriculture and the poor, governments are unable – or unwilling – to see beyond their immediate existence. We are direly in need of global governance for this kind of globalisation. (END/IPS COLUMNIST SERVICE)

(Edited by Phil Harris)

 

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G20 Seeks to Streamline Private Investment in Infrastructurehttp://www.ipsnews.net/2014/11/g20-seeks-to-streamline-private-investment-in-infrastructure/?utm_source=rss&utm_medium=rss&utm_campaign=g20-seeks-to-streamline-private-investment-in-infrastructure http://www.ipsnews.net/2014/11/g20-seeks-to-streamline-private-investment-in-infrastructure/#comments Tue, 18 Nov 2014 02:00:43 +0000 Carey L. Biron http://www.ipsnews.net/?p=137803 Water pouring through the sluice gates at Gariep Dam in Port Elizabeth, South Africa. Credit: Bigstock

Water pouring through the sluice gates at Gariep Dam in Port Elizabeth, South Africa. Credit: Bigstock

By Carey L. Biron
WASHINGTON, Nov 18 2014 (IPS)

Industrialised countries have agreed to collaborate on a new programme aimed at funnelling significant private-sector investment into global infrastructure projects, particularly in developing countries.

The Global Infrastructure Initiative, agreed to Sunday by governments of the Group of 20 (G20) countries, will not actually be funding new projects. But it will seek to create investment environments that are more conducive to major foreign investors, and to assist in connecting governments with financiers.In developing countries alone these needs could require up to a trillion dollars a year of additional investment, though currently governments are spending just half that amount.

The initiative’s work will be overseen at a secretariat in Australia, the host of this weekend’s G20 summit and a government that has made infrastructure investment a key priority. This office, known as the Global Infrastructure Hub, will foster collaboration between the public and private sectors as well as multilateral banks.

“With a four-year mandate, the Hub will work internationally to help countries improve their general investment climates, reduce barriers to investment, grow their project pipelines and help match investors with projects,” Australian Prime Minister Tony Abbott and Treasurer Joe Hockey said Sunday in a joint statement. “This will help improve how infrastructure markets work.”

Some estimate the undertaking could mobilise some two trillion dollars in new infrastructure investment over the next decade and a half. This would be available to be put into electrical grids, roads and bridges, ports and other major projects.

The G20 has emerged as the leading multilateral grouping tasked with promoting economic collaboration. Together, its membership accounts for some 85 percent of global gross domestic product.

With the broad aim of prompting global economic growth, the Global Infrastructure Initiative will work to motivate major institutional investors – banks, pension funds and others – to provide long-term capital to the world’s mounting infrastructure deficits. In developing countries alone these needs could require up to a trillion dollars a year of additional investment, though currently governments are spending just half that amount.

In recent years, the private sector has turned away from infrastructure in developing countries and emerging economies. Between 2012 and last year alone, such investments declined by nearly 20 percent, to 150 billion dollars, according to the World Bank.

“This new initiative very positively reflects a clear-eyed reading of the evidence that there are infrastructure logjams and obstacles in both the developing and developed world,” Scott Morris, a senior associate at the Center for Global Development, a Washington think tank, told IPS. “From a donor perspective, this indicates better listening to what these countries are actually asking for.”

Still, Morris notes, it remains unclear what exactly the Global Infrastructure Initiative’s outcomes will be.

“The G20 clearly intends to prioritise infrastructure investment,” he says, “but it’s hard to get a sense of where the priorities are.”

Lucrative opportunity

The Global Infrastructure Initiative is the latest in a string of major new infrastructure-related programmes announced at the multilateral level in recent weeks.

In early October, the World Bank announced a project called the Global Infrastructure Facility, which appears to have a mandate very similar to the new G20 initiative. At the end of the month, the Chinese government announced the creation of a new Asian Infrastructure Investment Bank (AIIB).

Many have suggested that the World Bank and G20 announcements were motivated by China’s forceful entry onto this stage. As yet, however, there is little clarity on the G20 project’s strategy.

“With so many discreet initiatives suddenly underway, I wonder if the new G20 project doesn’t cause confusion,” Morris says.

“Right now it’s very difficult to see any division in responsibilities between the G20 and World Bank infrastructure projects. The striking difference between them both and the AIIB is that the Chinese are offering actual capital for investment.”

The idea for the new initiative reportedly came from a business advisory body to the G20, known as the Business 20 (B20). The B20 says it “fully supports” the new Global Infrastructure Initiative.

“The Global Infrastructure Initiative is a critical step in addressing the global growth and employment challenge, and the business community strongly endorses the commitments of the G20 to increase quality investment in infrastructure,” Richard Goyder, the B20 chair, said Monday.

“The B20 estimates that improving project preparation, structuring and delivery could increase infrastructure capacity by [roughly] 20 trillion dollars by 2030.”

Goyder pledged that the business sector would “look to be heavily involved in supporting” the new projects.

Poison pill?

Yet if global business is excited at the prospect of trillions of dollars’ worth of new investment opportunities, civil society is expressing concern that it remains unclear how, or whether, the Global Infrastructure Initiative will impose rules on the new projects to minimise their potential social or environmental impacts.

“Private investment in infrastructure is crucial for closing the infrastructure funding gap and meeting human needs, and the G20 initiative is an important move by governments to catalyse that private investment,” Lise Johnson, the head of investment law and policy at the Columbia Center on Sustainable Investment at Columbia University, told IPS.

“It is key, however, that the initiative and the infrastructure hub develop procedures and practices not only to promote development of infrastructure, but to ensure that projects are environmentally, socially and economically sustainable for host countries and communities.”

Prominent multilateral safeguards policies such as those used by the World Bank are typically not applied to public-private partnerships, which will likely make up a significant focus of the G20’s new infrastructure push. Further, regulatory constraints could be too politically thorny for the G20 to forge new agreement.

“In the 2013 assessment of the G20’s infrastructure initiative by the G20 Development Working Group, only one item of the whole infrastructure agenda ‘stalled’ – and that was the work on environmental safeguards,” Nancy Alexander, director of the Economic Governance Program at the Heinrich Boell Foundation, a think tank, told IPS.

“I’ve always gotten the feedback from the G20 that such policies are matters of national sovereignty.”

The G20 is now hoping that trillions of dollars in infrastructure spending will create up to 10 million jobs over the next 15 years, spurring global economic growth. Yet Alexander questions whether this spending will be a “magic bullet” or a “poison pill”.

“Some of us are old enough to remember how recklessly the petrodollars of the 1970s and 1980s were spent – especially on infrastructure … Then, reckless lenders tried to turn a quick profit without regard to the social, environmental and financial consequences, including unpayable debts,” she says.

“Seeing the devastation wrought by poorly conceived infrastructure, many of us worked to create systems of transparency, safeguards and recourse at the multilateral development banks – systems that are now considered too time-consuming, expensive and imperialistic.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

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U.N. Chief Eyes Upcoming Summits to Resolve Development Crisishttp://www.ipsnews.net/2014/11/u-n-chief-eyes-upcoming-summits-to-resolve-development-crisis/?utm_source=rss&utm_medium=rss&utm_campaign=u-n-chief-eyes-upcoming-summits-to-resolve-development-crisis http://www.ipsnews.net/2014/11/u-n-chief-eyes-upcoming-summits-to-resolve-development-crisis/#comments Tue, 11 Nov 2014 18:31:42 +0000 Thalif Deen http://www.ipsnews.net/?p=137713 IPS U.N. Bureau Chief Thalif Deen interviews Secretary-General Ban Ki-moon. Credit: Lyndal Rowlands/IPS

IPS U.N. Bureau Chief Thalif Deen interviews Secretary-General Ban Ki-moon. Credit: Lyndal Rowlands/IPS

By Thalif Deen
UNITED NATIONS, Nov 11 2014 (IPS)

The continued widespread economic recession – aggravated by the recent Ebola outbreak in West Africa – is threatening to undermine the U.N.’s highly-touted post-2015 development agenda.

Still, Secretary-General Ban Ki-moon is placing his trust and confidence on two key upcoming summit meetings: a G20 gathering of world leaders in Brisbane, Australia later this week, and the International Conference on Financing for Development (ICFD) in Addis Ababa, Ethiopia, next July.

In an interview with IPS, just before his departure to Brisbane, he described the G20 as “the world’s primary global economic forum”, while the ICFD, he predicted, will be “one of the most important conferences in shaping sustainable development goals (SDGs).”

Ban has already cautioned world leaders of the urgent need for “a robust financial mechanism” to implement the proposed SDGs – and such a mechanism, he said, should be put in place long before the adoption of these goals in September 2015.

In a letter to G20 leaders, he says the successful implementation of the growth and sustainable development agendas will depend largely on mobilising “all sources of financing”.

“It is difficult to depend on public funding alone,” he told IPS, stressing the need for financing from multiple sources – including public, private, domestic and international.

The G20, a rare mix of both developed and developing countries, includes Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom and the United States, plus the European Union.

Overall, the G20 represents about two-thirds of the world’s population, 85 per cent of global gross domestic product and over 75 per cent of global trade.

The G20 president, this time around Australian Prime Minister Tony Abbott, usually invites several guest countries to participate in the summit. The presidency rotates on a geographical basis.

The countries which previously hosted the G20 summit include the United States (in 2008 and 2009), the United Kingdom (2009), Canada (2010), the Republic of Korea (2010), France (2011), Mexico (2012) and Russia (2013).

At the meeting in Brisbane Nov. 15-16, Abbott will welcome Spain as a permanent invitee; Mauritania as the 2014 chair of the African Union; Myanmar as the 2014 chair of the Association of South-East Asian Nations (ASEAN); Senegal, representing the New Partnership for Africa’s Development; New Zealand; and Singapore.

The ICFD, scheduled for July 2015, is billed as a U.N. conference and will be attended by all 193 member states.

Speaking of financing for development, Ban said official development assistance (ODA), from rich nations to poorer ones, “is necessary but not sufficient.”

According to the latest available statistics, only five countries – Norway (1.07 percent), Sweden (1.02), Luxembourg (1.00), Denmark (0.85) and the United Kingdom (0.72) – have reached the longstanding target of 0.7 of gross national income as ODA to the world’s poorer nations.

Meanwhile, the economic recession is taking place amidst the millions still living in hunger (over 800 million), jobless (more than 200 million), water-starved (over 750 million) and in extreme poverty (more than one billion), according to the United Nations.

Asked about a proposal for innovative sources of financing for development – including a tax on foreign exchange transactions – Ban said he has appointed a former French cabinet minister, Philippe Douster-Blazy, as his special adviser to explore these funding sources.

The proposal for innovative financing was approved at the 2002 ICFD in Mexico and it has raised about 2.0 billion dollars so far.

Ban’s most formidable task will be to ensure that rich countries deliver on their pledges, made in 2009, to provide a staggering 100 billion dollars by 2020 for a Green Climate Fund to prevent the most disastrous consequences of climate change.

“I need at least 10 billion dollars to operationalise the fund,” he said. So far, about 2.5 billion dollars have been made available.

Meanwhile, in his letter to the G20 leaders, Ban says new threats, including geopolitical tensions and the Ebola crisis, “have emerged to create further uncertainty” for the U.N.’s development agenda.

“The G20 Brisbane summit is well timed to provide the leadership that will translate into strong global growth and positive change in people’s lives,” he wrote. “Therefore, I urge you and your fellow leaders to seize the moment in Brisbane and set the stage for success in our shared work to build a more sustainable and prosperous world for all.”

The United Nations, he said, “stands ready to partner with you in your endeavour in Brisbane – and beyond.”

But a lingering question remains: how many of the world leaders will respond to the call?

Edited by Kitty Stapp

The writer can be contacted at thalifdeen@aol.com

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International Reform Activists Dissatisfied by BRICS Bankhttp://www.ipsnews.net/2014/07/international-reform-activists-dissatisfied-by-brics-bank/?utm_source=rss&utm_medium=rss&utm_campaign=international-reform-activists-dissatisfied-by-brics-bank http://www.ipsnews.net/2014/07/international-reform-activists-dissatisfied-by-brics-bank/#comments Thu, 17 Jul 2014 21:39:24 +0000 Mario Osava http://www.ipsnews.net/?p=135613 Chandrasekhar Chalapurath, an economist at Jawaharlal Nehru University in New Delhi, talks about development banks in India, at the International Seminar on the BRICS Bank. Credit: Mario Osava/IPS

Chandrasekhar Chalapurath, an economist at Jawaharlal Nehru University in New Delhi, talks about development banks in India, at the International Seminar on the BRICS Bank. Credit: Mario Osava/IPS

By Mario Osava
FORTALEZA, Brazil, Jul 17 2014 (IPS)

The creation of BRICS’ (Brazil, Russia, India, China and South Africa) own financial institutions was “a disappointment” for activists from the five countries, meeting in this northeastern Brazilian city after the group’s leaders concluded their sixth annual summit here.

The New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA), launched Tuesday Jul. 15 at the summit in the northeastern Brazilian city of Fortaleza, represent progress “from United States unilateralism to multilateralism,” said Graciela Rodriguez, of the Brazilian Network for the Integration of Peoples (REBRIP).

But “the opportunity for real reform was lost,” she complained to IPS at the International Seminar on the BRICS Bank, held in this city Wednesday and Thursday Jul. 16-17 as a forum for civil society organisations in parallel to the sixth summit.

The format announced for the NDB “does not meet our needs,” she said.

The NDB will promote “a new kind of development" only if its loans are made conditional on the adoption of low-polluting technologies and are guided by the Millennium Development Goals and their successors, the Sustainable Development Goals. -- Carlos Cosendey, international relations secretary at the Brazilian foreign ministry
The bank’s goal is to finance infrastructure and sustainable development in the BRICS and other countries of the developing South, with an initial capital investment of 50 billion dollars, to be expanded through the acquisition of additional resources.

“We want an international system that serves the majority, not just the seven most powerful countries (the Group of Seven),” that does not depend on the dollar and that has an international arbitration tribunal for financial controversies, said Oscar Ugarteche, an economics researcher at the National Autonomous University of Mexico.

“It is unacceptable that a district court judge in New York should put a country at risk,” he told IPS, referring to the June ruling of the U.S. justice system in favour of holdouts (“vulture funds”) in their dispute with Argentina, which could force another suspension of payments.

“We need international financial law,” similar to existing trade law, and an end to the dominance of the dollar in exchange transactions, which enables serious injustice against nations and persons, like embargoes on payments and income in the United States, he said.

“Existing international institutions do not work,” and the proof of this is that they have still not overcome the effects of the 2008 financial crisis, said the Mexican researcher.

Major powers like the United States and Japan have unsustainable debt and fiscal deficits, yet are not harassed by the International Monetary Fund (IMF), in contrast to the treatment meted out to less powerful nations, particularly in the developing South.

During the seminar, organised by REBRIP and Germany’s Heinrich Böll Foundation, oft-repeated demands were for civil society participation, transparency, environmental standards and consultation with the populations affected by projects financed by the NDB.

These demands have not yet been included in the NDB but may be discussed during its operational design over the next few years, while the group’s parliaments ratify its approval, said Carlos Cosendey, international relations secretary at the Brazilian foreign ministry, in a dialogue with activists.

Participants at one of several panels at the International Seminar on the BRICS Bank, held Jul. 16-17 in Fortaleza, Brazil. Credit: Mario Osava/IPS

Participants at one of several panels at the International Seminar on the BRICS Bank, held Jul. 16-17 in Fortaleza, Brazil. Credit: Mario Osava/IPS

Cosendey said that a disadvantage of the multilateral bank was the need for its regulations not to be confused with infringement of national sovereignty of member states. The political, cultural, legal and ethnic differences between the five countries could pose a major obstacle to the adoption of common criteria, he said.

The NDB can be constructive “if it integrates human rights” into its principles and presents solutions for the social impacts of the projects it finances, said Nondumiso Nsibande, of ActionAid South Africa, an NGO.

“We need roads, other infrastructure and jobs, as well as education, health and housing,” but big projects tend to harm poor communities in the places where they are carried out, she told IPS. It is still not known what levels of transparency and social concern the bank will have, she said.

In the view of Chankrasekhar Chalapurath, an economist at Jawaharlal Nehru University in New Delhi, the NDB will alleviate India’s great needs for infrastructure, energy, long distance transport and ports. However, he does not expect it to make large investments in one key service for Indians: sanitation.

Having an Indian as the bank’s first president, as the five leaders have decided, will help attract more investments, but he said people’s access to water must remain a priority.

Cosenday said the NDB will promote “a new kind of development.”

But Chalapurath told IPS that this will only happen if its loans are made conditional on the adoption of low-polluting technologies and are guided by the Millennium Development Goals and their successors, the Sustainable Development Goals, as well as human rights and other best practices.

Adopting democratic processes within the bank will facilitate dialogue with social movements, parliaments and society in general, he said.

Incorporating environmental issues and gender parity is also essential, said Ugarteche and Rodriguez, who regards this as necessary in order to make progress towards “environmental justice.”

Not only roads and ports need to be built; even more important is the “social infrastructure” that includes sanitation, water, health and education, said Rodriguez, the coordinator of the REBRIP working group on International Economic Architecture.

Mobilising resistance to large projects that affect local populations in the places they are constructed will be part of the response to the probable priority placed by the NDB on financing physical infrastructure projects, she announced.

The social organisations gathered in Fortaleza, with representatives from Brazil, India, China, South Africa and other countries that are not members of the group, are preparing to coordinate actions to influence the way the bank and its policies are designed, and to monitor its operations and the actions of the BRICS group itself.

Brazilian economist Ademar Mineiro, also of REBRIP, said there was potential for national societies to influence the format and policies of the NDB, and time for them to organise and mobilise. “It is an unprecedented opportunity,” he told IPS.

Russia did not originally support the BRICS bank, preferring private funding. But Mineiro said its position changed after the United States and the European Union involved multilateral financial institutions like the World Bank in sanctions against Moscow for its annexation of Crimea, a part of Ukraine.

BRICS evolved “from the economic to the political,” with its members demanding more power in the international system. The alliance is one of the pillars of the Chinese strategy to conquer greater influence, including in the West, said Cui Shoujun, a professor at the School of International Studies of Renmin University in China.

“The BRICS need China more than the other way round,” he told IPS, adding that the Chinese economy is 20 times larger than South Africa’s and four times larger than those of India and Russia.

As well as seeking natural resources from other countries, among the reasons why China has joined and supports BRICS is strengthening the legitimacy in power of the Communist Party through internal stability and prosperity, the academic said.

(END)

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IMF Issues “Revolutionary” Warning on Corporate Tax Avoidancehttp://www.ipsnews.net/2014/06/imf-issues-revolutionary-warning-on-corporate-tax-avoidance/?utm_source=rss&utm_medium=rss&utm_campaign=imf-issues-revolutionary-warning-on-corporate-tax-avoidance http://www.ipsnews.net/2014/06/imf-issues-revolutionary-warning-on-corporate-tax-avoidance/#comments Thu, 26 Jun 2014 21:31:47 +0000 Carey L. Biron http://www.ipsnews.net/?p=135215 By Carey L. Biron
WASHINGTON, Jun 26 2014 (IPS)

The staff at the International Monetary Fund (IMF) has issued an unusually stark warning over the lack of harmonised global tax policies, pointing out that these gaps are allowing for widespread tax gaming by corporations with particularly negative impacts for developing countries.

Anti-poverty advocates are lauding a new staff paper from the fund released Wednesday. Its findings not only coincide with civil society calls for major taxation reforms at the national and international levels, but also repeatedly push back against longstanding tax-related dogma, including that offered by the Washington-based IMF itself.“As tax dodging knows no border, it makes sense to move to the international level to create such a worldwide entity.” -- Catherine Olier of Oxfam

“This is, frankly, a revolutionary paper,” Jo Marie Griesgraber, the executive director of the New Rules for Global Finance Coalition, a Washington-based international network, told IPS.

“It looks very carefully at many aspects of tax planning, and each time says that this has very negative impact on developing countries … Ultimately, it says that traditional tax theory is essentially uninformed by empirical knowledge.”

The paper is the result of a new focus on tax-dodging among the Group of 20 (G20) industrialised countries, which directed the fund to undertake related research. The findings are particularly notable in their sustained focus on the impacts on developing countries.

“Our technical assistance work in developing countries frequently encounters large revenue losses through gaps and weaknesses in the international tax regime,” Michael Keen, deputy director of the IMF’s Fiscal Affairs Department, said in a statement.

“The sums involved for them can be large, not just relative to corporate tax but relative to all tax revenue: 10-15 percent in some cases. The paper reports new evidence that these effects are in fact systematically more important for developing countries.”

Corporate tax rates in all countries have plummeted in recent decades, the paper notes.

Low-income countries have seen these rates degrade from near 50 percent in 1980 to under 30 percent last year. Others have seen similar plunges, with high-income countries seeing corporate taxation fall from around 40 percent three decades ago to little more than 20 percent today.

Such trends have been tracked for years. Yet in the aftermath of the global financial crisis, rich and middle-income countries have begun actively discussing how to maximise their tax revenues, with a focus on ending corporate accounting gimmickry.

Rich companies and individuals could be stashing away as much as 20 trillion dollars overseas in order to escape national taxation, according to some estimates.

“Developed countries today need more income and are mad because not everyone is paying their taxes,” Griesgraber says.

“And that anger is also translating into public pressure. People who pay their taxes even during a difficult recession are even madder than the governments.”

“Meaningless” designations

According to the IMF data, developing countries should perhaps be the most incensed by the impacts of today’s global taxation hodgepodge. The paper offers new findings on the ramifications of what the fund terms “spillover effects” – the ways in which one country’s tax rules impact on another country, which can also be thought of in terms of tax competition between countries.

This phenomenon has been significantly exacerbated as multinational companies have increasingly learned how to legally “move” their operations – largely on paper – for tax benefit. Such companies appear to be based in countries with low taxes, despite doing most of their work in another country that, in turn, is unable to place levies on the company’s full earnings.

“Current international tax arrangements rest on concepts of companies’ ‘residence’ and the ‘source’ of their income, both of which globalization has made increasingly fragile (some would say meaningless),” the paper states.

“At its core, a key issue in assessing any international tax arrangement is how it divides the rights to tax between source and residence countries … The allocation of rights is especially important for low-income countries, however, as flows are for them commonly very asymmetric – they are essentially ‘source’ countries.”

The fund staff found that the impact of these spillover effects on corporate tax bases are “significant and sizable” but are “especially pronounced for low-income countries”. Compared to rich countries, the paper notes, “the base spillovers from others’ tax rates are two to three times larger” in developing countries, and “statistically more significant”.

Particularly problematic has been the extractives industry, though the fund also calls out telecommunications companies. The paper recounts IMF experiences in multiple countries where corporate tax trickery has eaten up much of a project’s revenue, such as a “gold mining sector in which USD 100 billion has been invested over the last decade, but which is almost entirely debt financed”.

The fund ultimately goes so far as to suggest that countries should be extremely careful about signing any bilateral tax treaty, urging developing country governments instead to signal openness to investment by other means. Through such agreements, countries can sign away their right to levy full tax rates and give an upper hand to foreign corporations.

“The IMF analysis raises some very worrying concerns about the impact of tax rules and practices in rich countries on the ability of poor countries to raise their own revenues,” Diarmid O’Sullivan, a tax justice policy advisor with ActionAid, a watchdog group, said Wednesday.

“We see a clear message to … major capital-exporting countries to review their tax rules and make sure they are not harming the ability of poor countries to raise the revenues they need for their development.”

Comprehensive approach

One key step being pushed by governments and civil society today to cut down on corporate tax avoidance entails the automatic exchange of tax information between governments. Doing so, proponents say, would quickly clear up the discrepancies that can be exploited by tax-dodgers.

In February, the Organisation for Economic Co-operation and Development (OECD), comprised of 34 rich countries, unveiled just such a proposal. Still, anti-poverty campaigners have warned that developing economies were not included in discussions around the OECD plan – though a roadmap is due by September on facilitating poor countries’ participation in such exchanges, an OECD official told IPS.

Some are now hoping that this new flurry of work could be leading towards the formalisation of a stricter international framework on tax policy, in line with the globalised environment of today’s multinational corporations. Indeed, the IMF’s new paper notes that “the case for an inclusive and less piecemeal approach to international tax cooperation grows.”

Indeed, a decade and a half ago an IMF official proposed the establishment of a World Tax Authority, an idea that campaigners are now hoping to revive.

“As tax dodging knows no border, it makes sense to move to the international level to create such a worldwide entity,” Catherine Olier, a policy advisor with Oxfam International, an advocacy and humanitarian group, told IPS.

“Modalities about its functionalities and mandate would remain to be determined, but it could have a role in setting minimum standards to avoid harmful tax competition between countries – and, if ambitious, an international dispute mechanisms to fight countries that deliberately put in place tax policies with too much negative spillover effect on others.”

The IMF and OECD reports will both go before the G20 at a summit in November.

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U.S. Blasted on Failure to Ratify IMF Reformshttp://www.ipsnews.net/2014/04/u-s-blasted-failure-ratify-imf-reforms/?utm_source=rss&utm_medium=rss&utm_campaign=u-s-blasted-failure-ratify-imf-reforms http://www.ipsnews.net/2014/04/u-s-blasted-failure-ratify-imf-reforms/#comments Sat, 12 Apr 2014 00:31:45 +0000 Jim Lobe http://www.ipsnews.net/?p=133620 By Jim Lobe
WASHINGTON, Apr 12 2014 (IPS)

While Republicans complain relentlessly about U.S. President Barack Obama’s alleged failure to exert global leadership on geo-political issues like Syria and Ukraine, they are clearly undermining Washington’s leadership of the world economy.

That conclusion became inescapable here during this week’s in-gathering of the world’s finance ministers and central bankers at the annual spring meeting here of the International Monetary Fund (IMF) and the World Bank.The delays are clearly damaging Washington’s global economic and geo-political agenda: persuading other G20 countries to adopt expansionary policies and punish Moscow for its moves against Ukraine.

In the various caucuses which they attended before the formal meeting began Friday, they made clear that they were quickly running out of patience with Congress’s – specifically, the Republican-led House of Representatives – refusal to ratify a 2010 agreement by the Group of 20 (G20) to modestly democratise the IMF and expand its lending resources.

“The implementation of the 2010 reforms remains our highest priority, and we urge the U.S. to ratify these reforms at the earliest opportunity,” exhorted the G20, which represent the world’s biggest economies, in an eight-point communiqué issued here Friday.

“If the 2010 reforms are not ratified by year-end, we will call on the IMF to build on its existing work and develop options for next steps…” the statement asserted in what observers here called an unprecedented warning against the Bretton Woods agencies’ most powerful shareholder.

The message was echoed by the Group of 24 (G24) caucus, which represents developing countries, although, unlike the G20, its communique didn’t mention the U.S. by name.

“We are deeply disappointed that the IMF quota and governance reforms agreed to in 2010 have not yet come into effect due to non-ratification by its major shareholder,” the G24 said.

“This represents a significant impediment to the credibility, legitimacy and effectiveness of the Fund and inhibits the ability to undertake further, necessary reforms and meet forward-looking commitments.”

The reform package, the culmination of a process that began under Obama’s notoriously unilateralist Republican predecessor, George W. Bush, would double contributions to the IMF’s general fund to 733 billion dollars and re-allocate quotas – which determine member-states’ voting power and how much they can borrow – in a way that better reflects the relative size of emerging markets in the global economy.

In addition to enhancing the IMF’s lending resources, the main result of the pending changes would increase the quotas of China, Brazil, Russia, India, and Turkey, for example, at the expense of European members whose collective representation on the Fund’s board is far greater than the relative size of their economies.

Spain, for instance, currently has voting shares similar in size to Brazil’s, despite the fact that the Spanish economy is less than two-thirds the size of Brazil’s. And of the 24 seats on the IMF’s executive board, eight to ten of them are occupied by European governments at any one time.

The reforms would only change the status quo only modestly. While the European Union (EU) members currently hold a 30.2 percent quota collectively, that would be reduced only to 28.5 percent. The biggest gains would be made by the so-called BRICS (Brazil, Russia, India, China, and South Africa) – from 11 percent to 14.1 percent — although almost all of the increase would go to Beijing.

Washington’s quota would be marginally reduced – from 16.7 percent to 16.5 percent, preserving its veto power over major institutional changes (which require 85 percent of all quotas). Low-income countries’ share would remain the same at a mere 7.5 percent collectively, although their hope – shared by civil-society groups, such as Jubilee USA and the New Rules for Global Finance Coalition — is that this reform will make future changes in their favour easier.

Thus far, 144 of the IMF’s 188 member-states, including Britain, France, and Germany and other European countries that stand to lose voting share, have ratified the package. But, without the 16.7 percent U.S. quota, the reforms can’t take effect.

The Obama administration has been criticised for not pressing Congress for ratification with sufficient urgency. But, realising that its allies’ patience was running thin, it pushed hard last month to attach the reform package to legislation providing a one-billion-dollar bilateral aid package for Ukraine during the crisis with Russia over Crimea.

While the Democratic-led Senate approved the attachment, the House Republican leadership rejected it, despite the fact that Kiev would have been able to increase its borrowing from the IMF by about 50 percent under the pending reforms.

House Republicans – who, under the Tea Party’s influence, have moved ever-rightwards and become more unilateralist on foreign policy since the Bush administration – have shown great distrust for multilateral institutions of any kind.

Both the far-right Heritage Foundation and the neo-conservative Wall Street Journal have railed against the reforms, arguing variously that they could cost the U.S. taxpayer anywhere from one billion dollars to far more if IMF clients default on loans, and that the changes would reduce Washington’s ability to veto specific loans.

They say the IMF’s standard advice to its borrowers to raise taxes and devalue their currency is counter-productive and could become worse given the Fund’s new emphasis on reducing income inequalities; and that, according to the Journal, the reforms “will increase the clout of countries with different economic and geo-political interests than America’s.”

Encouraged by, among others, the U.S. Chamber of Commerce and their Wall Street contributors, some House Republicans have indicated they could support the reforms. But thus far they have insisted that they would only do so in exchange for Obama’s easing new regulations restricting political activities by tax-exempt right-wing groups.

Meanwhile, however, the delays are clearly damaging Washington’s global economic and geo-political agenda – persuading other G20 countries to adopt expansionary policies and punish Moscow for its moves against Ukraine – during the meetings here.

“The proposed IMF reforms are a no-brainer,” according to Molly Elgin-Cossart, a senior fellow for national security and international policy at the Center for American Progress. “They modernise the IMF and restore American leadership on the global stage at a time when the world desperately needs it, without additional cost for American taxpayers.”

Further delay, especially now that the G20 appear to have set a deadline, could in fact reduce Washington’s influence.

While she stressed she was not prepared to give up on Congress, IMF managing director Christine Lagarde told reporters Thursday the Fund may soon have to resort to a “Plan B” to implement the reforms without Washington’s consent.

While she did not provide details of what are now backroom discussions, two highly respected former senior U.S. Treasury secretaries suggested in a letter published Thursday by the Financial Times that “the Fund should move ahead without the U.S. …by raising funds from others while depriving the U.S. of some or all of its longstanding power to block major Fund actions.”

C. Fred Bergsten and Edwin Truman, who served under Jimmy Carter and Bill Clinton, respectively, suggested that the IMF could make permanent an initiative to arrange temporary bilateral credit lines of nearly 500 billion dollars from 38 countries who could decide on their disposition without the U.S.

More radically, they wrote, the Fund could increase total country quota subscriptions that would remove Washington’s veto power over institutional changes.

“The U.S. deserves to lose influence if it continues to fail to lead,” the two former officials wrote.

Jim Lobe’s blog on U.S. foreign policy can be read at Lobelog.com.

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Russia Expelled From G8, but G20? Not So Fasthttp://www.ipsnews.net/2014/04/russia-expelled-g8-g20-fast/?utm_source=rss&utm_medium=rss&utm_campaign=russia-expelled-g8-g20-fast http://www.ipsnews.net/2014/04/russia-expelled-g8-g20-fast/#comments Tue, 01 Apr 2014 21:42:55 +0000 Thalif Deen http://www.ipsnews.net/?p=133357 Russian President Vladimir Putin awaits leaders arriving for the G20 Summit in St. Petersburg on Sep. 5, 2013. Credit: UN Photo/Eskinder Debebe

Russian President Vladimir Putin awaits leaders arriving for the G20 Summit in St. Petersburg on Sep. 5, 2013. Credit: UN Photo/Eskinder Debebe

By Thalif Deen
UNITED NATIONS, Apr 1 2014 (IPS)

When Western powers, led by the United States, decided to throw Russia out of the Group of 8 (G8) industrial nations, it was aimed at punishing and “isolating” President Vladimir Putin for his intervention in Ukraine and “annexation” of Crimea.

“What’s next? Expel Russia from the United Nations and the G20?” an Asian diplomat jokingly asked one of his colleagues at the U.N. delegate’s lounge last week, hinting at what could only be construed as a Western political fantasy.The procedure the G7 followed to transform itself to G8 in 1998 (with the inclusion of Russia) was as opaque as the process that led to Moscow’s virtual expulsion.

The G8 move was pretty tame because it was a decision taken by seven Western industrial nations: the United States, Britain, France, Germany, Canada, Italy and Japan, along with the European Union.

But Russia is also a member of the G20, a coalition of both developed and developing countries, as well as the economic powerhouse called BRICS (comprising Brazil, Russia, India, China and South Africa).

Australia has reportedly warned that Russia may be excluded from the next G20 summit meeting in Brisbane in November. But that is more easily said than done.

On the sidelines of last week’s Nuclear Security Summit in The Hague, the foreign ministers of BRICS warned Australia against any such action.

In a statement released during the summit, the foreign ministers of BRICS said “the custodianship of the G20 belongs to all member states equally and no one member state can unilaterally determine its nature and character.”

The G20 members include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, United Kingdom, United States and the European Union (EU).

At a General Assembly vote last Friday, on a resolution implicitly critical of Russia on the upheaval in Ukraine, Russia’s four BRICS partners abstained, joining 54 others.

The final vote was 100 for the resolution, 11 against, but with 58 abstentions in an Assembly with 193 votes.

Chakravarthi Raghavan, editor-emeritus of the Geneva-based South-North Development Monitor, told IPS, “The G7/G8 and the G20 are at best self-appointed informal gatherings, without any legitimacy, mere costly annual exercises, where occasionally side-event meetings are of some help.”

He pointed out that the G7/G8 originally came into being in the wake of the oil crisis to tackle economic issues and promote a dialogue of the G5/G7 with the Organisation of Petroleum Exporting Countries (OPEC) to promote agreements and avoid confrontations.

Soon, it became clear the G7 process was not effective, and the initial aim of informal but frank and spontaneous exchange of views among the leaders failed.

“Their own bureaucracies and ministries in governments did not want this process to move forward,” said Raghavan, a veteran journalist and a former editor-in-chief of Press Trust of India (PTI) who has covered the United Nations, both in Geneva and New York, for several decades.

But instead of abandoning the annual meetings, he said, the G7 continued to meet, with the original economic focus lost, and with costly preparations and meetings of “sherpas”, where the gatherings themselves became too formalised, and where the outcome had been already decided or agreed to at the lowest common measure of accord.

He also pointed out that the G7/G8 increasingly began pronouncing themselves on all kinds of subjects – with none of the leaders able to ensure the decisions were carried out in their own countries.

Vijay Prashad, author of “The Poorer Nations: A Possible History of the Global South”, told IPS the procedure the G7 followed to transform itself to G8 in 1998 (with the inclusion of Russia) was as opaque as the process that led to Moscow’s virtual expulsion.

The Group of Seven (Canada, France, Germany, Italy, Japan, UK and USA) came together in 1974 to consolidate their response to the major thrust from the Third World Project: an assault of the oil weapon of 1973 that consolidated in the U.N. General Assembly resolution 3201 in May 1974 for a New International Economic Order (NIEO).

The G7 was formed, as former U.S. President Gerald Ford put it, “to ensure that the current world economic situation is not seen as a crisis in the democratic or capitalist system,” Prashad said.

“It had to be seen as a momentary shock, not a systematic challenge,” he added.

The collapse of the Third World Project, the rise of a new International Monetary Fund (IMF)-driven neo-liberal dispensation and the demise of the Union of Soviet Socialist Republics (USSR) moved the G7 to welcome battered Russia into its arms, said Prashad, who is the Edward Said Chair at the American University of Beirut in Lebanon.

Membership in the G7 came with the promise that the North Atlantic Treaty Organisation (NATO) would not move one step closer to Russia than the German border, he added.

Raghavan told IPS the annual G20 meeting pronounces itself on a range of political, economic and other arenas — but with less and less effect — whether (as they have done several times) for concluding Doha trade negotiations or other areas.

Some of their views on global financial stability – addressed to the Bank of International Settlements – have factually been very diluted in actual decisions and norms because of the lobbying of the big financial groups, both in New York and London, said Raghavan, author of the just released “Third World in the Third Millennium”.

Prashad said when the credit crisis startled the West in 2007, the G8 hastened to China and India, asking for funds.

If the money came – as it did – the G8 would wind up its operations and the G20 (with Brazil, China, India and South Africa as members) would take over as the effective executive managers of planetary affairs – which it did not, he added.

The G20 had been formed during the Asian financial crisis of 1997-98 to ward off any nationalistic reactions to that crash.

“As the Western stock markets rallied by 2011, the promise was forgotten,” he said.

The G8 continued – much to the chagrin of the BRICS bloc, which had assumed it would now share power.

They agree the West’s move east is dangerous, and it is unlikely they will allow for the expulsion of Russia from the G20 – itself of limited consequence, he noted.

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G20 Urges U.S. Action on IMF Reforms by Aprilhttp://www.ipsnews.net/2014/02/g20-urges-u-s-action-imf-reforms-april/?utm_source=rss&utm_medium=rss&utm_campaign=g20-urges-u-s-action-imf-reforms-april http://www.ipsnews.net/2014/02/g20-urges-u-s-action-imf-reforms-april/#comments Tue, 25 Feb 2014 00:58:50 +0000 Carey L. Biron http://www.ipsnews.net/?p=132005 By Carey L. Biron
WASHINGTON, Feb 25 2014 (IPS)

The Group of 20 (G20) industrialised and emerging economies on Sunday formally expressed frustration with the ongoing inability of the United States to approve a major reform package that would see governance at the International Monetary Fund (IMF) shift more towards developing countries.

The reforms were approved by the IMF in 2010 and have since been ratified by more than three-quarters of the fund’s member governments. Yet while the administration of President Barack Obama has been a key proponent of the reforms, the U.S. Congress has thus far been unwilling to approve the changes."The BRICS are wondering why they put up their money when nothing is happening." -- Jo Marie Griesgraber

Because the United States, with around 17 percent of voting rights (or “quota” shares) has an effective veto within the IMF, the reforms cannot go forward without the U.S. vote. The process has now missed a January deadline, while a second deadline for a subsequent round of changes is looming.

“Given that the U.S. is a big part of the G20, it is no small victory that emerging market and developing countries were able to get IMF reform so formally prioritised,” Kevin P. Gallagher, co-director of the Global Economic Governance Initiative at Boston University, told IPS. “Such pressure is basically the US administration and the rest of the world against the U.S. Congress.”

On Sunday, the G20, which has been a key organiser of the international financial response in recent years, strongly criticised the deadlocked reforms process. It also offered a new deadline for U.S. action.

“We deeply regret that the IMF quota and governance reforms agreed to in 2010 have not yet become effective,” the G20 stated in a communiqué on Sunday, following a ministerial meeting in Australia, which is hosting the grouping this year.

IMF chief Christine Lagarde. The quota changes would significantly increase the currently underweighted influence of fast-rising economies such as Brazil, China, India and Turkey. Credit: World Economic Forum/cc by 2.0

IMF chief Christine Lagarde. The quota changes would significantly increase the currently underweighted influence of fast-rising economies such as Brazil, China, India and Turkey. Credit: World Economic Forum/cc by 2.0

“Our highest priority remains ratifying the 2010 reforms, and we urge the US to do so before our next meeting in April. In April, we will take stock of progress towards meeting this priority.”

IMF Managing Director Christine Lagarde echoed this concern, saying Sunday that the fund “share[s] this view and urge[s] rapid progress on implementation.” The Washington-based institution is considered the world’s “lender of last resort”.

The quota changes would significantly increase the currently underweighted influence of fast-rising economies such as Brazil, China, India and Turkey. It would do so largely by decreasing the cumulative share of European members, considered outsized in terms of gross domestic product.

The Netherlands and Spain, for instance, both have voting shares similar in size to Brazil’s, despite the fact that the Spanish economy is less than two-thirds the size of the Brazilian. Given the problems in the eurozone, the European countries have also been prime beneficiaries of IMF support in recent years.

Under the quota reforms, the so-called BRICS countries – middle-income countries including Brazil, India and China – would see their vote shares expand the most significantly. The 2010 reforms would shift around nine percent of these shares towards developing countries, while also doubling the size of the fund’s overall lending capacity.

“The Europeans love it – they’re gloating. They have excessive power, are significantly overrepresented, and they love that [the United States] is not moving the reforms process forward,” Jo Marie Griesgraber, the executive director of the New Rules for Global Finance Coalition, a Washington-based international network, told IPS.

“On the other hand, the BRICS are wondering why they put up their money when nothing is happening. They’re most unhappy. In the long term, the BRICS countries could say this doesn’t work for them and move more seriously away from the IMF.”

On Sunday, a top Indian finance official warned that the failure to move forward on quota reform was threatening to undermine both IMF and G20 legitimacy.

“This is perhaps the first visible failure of G20. This has reduced the credibility of G20,” India’s economic affairs secretary, Arvind Mayaram, said in Sydney, calling implementation of the 2010 reforms “vital for the credibility, legitimacy and effectiveness of the IMF”.

Alternative institutions

Although an esoteric topic, the IMF governance reforms have received widespread approval from important constituencies in the United States, including major business and financial lobby groups as well as a long list of Republican luminaries.

In fact, President Obama bears some blame for the current situation, having decided in 2012 for political reasons not to request approval from the U.S. Congress. Yet since then, his administration has tried to do so repeatedly.

Each time, however, the Republican-controlled House of Representatives has rebuffed these requests, though apparently less for ideological than for political reasons. The last such attempt took place last month, when Republicans agreed to include the IMF reforms proposal in a major appropriations bill – but only if the Democrats would agree to stop the U.S. Treasury from imposing proposed restrictions on political “dark money”.

President Obama reportedly refused the trade, and there are few legislative options left for moving related legislation through Congress in coming months, particularly as national elections loom at the end of the year. (On Sunday, U.S. Treasury Secretary Jacob Lew told the G20 his office “will continue to work with Congress to pass legislation as soon as possible to secure the 2010 reforms, which are vital to our economic and national security interests.”)

Some observers say that such a situation should only strengthen an ongoing process under which developing countries are building multilateral structures outside the IMF.

“Upcoming Congressional elections may lead to further entrenchment by the U.S. on this issue. Thus it is imperative that the developing world continue to build alternative institutions such as the BRICS bank and the BRICS exchange reserve pool,” BostonUniversity’s Gallagher says.

“Just as important is for these bodies to have more equitable and transparent processes, so they can be held up as models against the arcane structures in the international financial institutions.”

The BRICS countries announced their intention to create a new multilateral development bank last year. Yet since then, progress has reportedly been slow, particularly as ongoing economic roiling is being felt particularly strongly in emerging economies.

“There is good talk about these projects, but most countries remain very reluctant to walk away from the [IMF]. Nonetheless, we are already seeing a gradual erosion in the use of the institution,” New Rules’s Griesgraber says.

“From our perspective, we need to get through this current reform process so we can move on to the larger governance issues that need to be addressed at the fund. Let’s equalise the power, introduce greater transparency around the board, and ensure that likely consequences for poor people are assessed before the IMF acts.”

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Illicit Capital Leaving Developing Countries Up by 14 Percenthttp://www.ipsnews.net/2013/12/illicit-capital-leaving-developing-countries-14-percent/?utm_source=rss&utm_medium=rss&utm_campaign=illicit-capital-leaving-developing-countries-14-percent http://www.ipsnews.net/2013/12/illicit-capital-leaving-developing-countries-14-percent/#comments Thu, 12 Dec 2013 23:48:49 +0000 Carey L. Biron http://www.ipsnews.net/?p=129520 By Carey L. Biron
WASHINGTON, Dec 12 2013 (IPS)

Developing countries are likely losing more than a trillion dollars a year in “illicit financial flows” stemming from crime and corruption, according to new estimates. This fast-rising figure is already 10 times the total amount of foreign aid these countries are receiving.

Between 2002 and 2011, governments in the developing world are thought to have lost a total of almost six trillion dollars, largely due to poor governance and lax regulation, according to Global Financial Integrity (GFI), a Washington-based watchdog. Included in its estimates are ill-gotten wealth from purposefully incorrect trade invoices, the use of shell companies and tax havens, and other accounting gimmicks.

“This gives further evidence to the notion that illicit financial flows are the most devastating economic issue impacting the global South,” Raymond W. Baker, GFI’s president, stated in the introduction to a report released Wednesday, calling the numbers a “wake-up call to world leaders on the urgency with which illicit financial flows must be addressed.”

Particularly worrying is the fact that the rate at which these outward flows have been growing appears to be increasing substantially."Illicit financial flows are the most devastating economic issue impacting the global South."
-- Raymond W. Baker

In 2002, for instance, the earliest year that GFI’s researchers have examined, illicit financial flows are thought to have been around 270.3 billion dollars. By 2011, the latest year for which estimates are available, that figure had grown to 946.7 billion dollars, and has likely increased since then.

When adjusted for inflation, this translates into an average growth of more than 10 percent a year, while the 2011 number constituted a 13.7 percent increase over 2010.

“Outflows have certainly been increasing,” Dev Kar, GFI’s chief economist and a co-author of the new report, told IPS. “During the economic crisis both imports and exports declined, but as economic activity has recovered so too have these outflows.”

Kar also cautions that the GFI estimates are likely conservative. They include neither unofficial (“hawala”) financial flows nor large-scale cash transactions, and as such are unable to offer a glimpse of broader underworld economies, including drug or human trafficking.

Asia is seen as having the most significant problems, accounting for around 40 percent of all illicit outflows from developing countries. While Africa’s share was only around seven percent in 2011, the continent did have the highest ratio of average illicit flows to gross domestic product, at around 5.7 percent.

With Africa also the world’s most aid-dependent region, an increasing concern for many is how to staunch the flow of some of this illicit capital so it can be ploughed back into public sector spending such as on health, education and public infrastructure.

Shadow systems

Major development institutions have started paying attention to such discrepancies. The humanitarian group Oxfam estimates that some 32 trillion dollars are currently sitting in tax havens around the world, for instance, and suggests that taxes on this sum could raise nearly 190 billion dollars a year.

“Governments should agree to end global hunger by 2025 and an end to tax havens, which could help pay for this and much more,” Stephen Hale, advocacy head for Oxfam, said in a statement. “Tax-dodging effectively takes food from hungry mouths.”

The past year has actually seen notable moves by the international community to close down certain avenues used to hide or shield unreported wealth from prying states. Major multilateral groupings including the Group of Eight (G8) rich countries and the Group of 20 (G20) industrialised countries, for instance, have put tax abuse at the top of their list of priorities.

This summer, a high-level United Nations panel negotiating the next phase of the Millennium Development Goals (MDGs), for which the deadline is 2015, stated that one of its highest priorities would be tackling the abuse of offshore tax havens and illicit financial flows.

The following month, nearly a dozen EU members agreed to the world’s first multilateral system of tax information exchange, based on similar bilateral U.S. requirements passed three years ago.

“The fact that illicit financial flows are being mentioned in the G20 and other international organisations – that didn’t exist before,” Brian LeBlanc, a junior economist with GFI and a co-author of the new report, told IPS. “Earlier, these issues were seen solely as a developing country problem but now we’re seeing developed countries taking action. So we’re making some progress.”

Yet transparency advocates urge that far more needs to be done, and GFI’s Kar says that he expects the moves that have been taken so far will have little impact on illicit financial flows in the near term.

“The G20 has basically not tackled the shadow financial system, which remains largely intact – there have been no moves to improve transparency, not much has been done on tax havens or blind trusts,” he says.

“Importantly, much of the conversation currently focuses on developed rather than developing countries. We believe that governance factors are the main engines of illicit flows, and in the major countries governance is simply not improving – in fact, it’s deteriorating in many countries.”

GFI has now put out research on illicit financial flows for several years in a row. Yet Kar says the startling estimates presented appear to have made little impact on government officials in many developing countries, even as state coffers in those countries continue to struggle in the aftermath of the global financial crisis.

“In most countries it’s had almost zero impact, with government officials refusing even to acknowledge that this is a problem. Malaysia, for example, will only say that our estimates are overstated,” Kar says, noting that Malaysia ranked fourth on GFI’s list of the largest exporters of illicit capital.

“There remains a powerful, corrupt nexus between politicians and business, covering the financing of elections, non-transparency of business conduct, kickbacks in government contracting,” Kar added.

“These are huge issues, and we expect a long process before countries come to accept the fact that illicit flows are a problem – and then to move to implement policies to deal with the situation.”

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The Emerging Economies and the G20 Summit at St. Petersburghttp://www.ipsnews.net/2013/09/the-emerging-economies-and-the-g-20-summit-at-st-petersburg/?utm_source=rss&utm_medium=rss&utm_campaign=the-emerging-economies-and-the-g-20-summit-at-st-petersburg http://www.ipsnews.net/2013/09/the-emerging-economies-and-the-g-20-summit-at-st-petersburg/#comments Tue, 17 Sep 2013 14:54:11 +0000 Shyam Saran http://www.ipsnews.net/?p=127557

* Shyam Saran, a former Indian foreign secretary and the current chairman of the National Security Advisory Board, writes in this column that the Syrian crisis overshadowed economic coordination issues at the recent G-20 summit. Saran, current chairman of the Research and Information Systems for Developing Countries and a senior fellow at the Centre for Policy Research in New Delhi, also discusses the deliberations by BRICS leaders on the sidelines of the meeting.

By Shyam Saran
NEW DELHI, Sep 17 2013 (Columnist Service)

The eighth G20 Summit convened in St. Petersburg on Sept. 5-6, 2013 was dominated by the Syrian crisis, deflecting attention from the mandate of the gathering to serve as the premier forum for international economic coordination.

When leaders of the most influential countries meet it is inevitable that the pressing political issues of the day take centre stage.

Shyam Saran

Shyam Saran

The G7 too began as a forum for economic consultation and coordination among the world’s advanced market economies in 1975, to cope with the fallout of the 1973 oil crisis.

Just three years later, in 1978, the G7 issued its first Political Declaration and became, thereafter, the political, security and economic steering committee of the most powerful nations.

The G20 has taken its first steps in the same direction and it is likely that its role as a political and security forum will evolve steadily though informally at first. This trend will be reinforced if the United Nations Security Council remains a relic of a bygone international order.

That the G20 provided a platform on which the U.S. and Russia initiated steps leading to an eventual understanding on Syria’s chemical weapons is an indication of the potential political utility of the forum. These steps were taken against a strong prevailing sentiment at the summit against a military strike against Syria, favoured by the U.S. and some, but not all, of its allies.

The emerging economies were able to reflect some of their key concerns in the Summit declaration. The unconventional monetary policies pursued by reserve currency countries such as the U.S. and lately Japan, involving significant injections of liquidity into the system and keeping interest rates at zero or near zero, have confronted emerging economies like Brazil and India with volatile capital flows and exchange rate instability.

The declaration acknowledged for the first time that monetary policies pursued by advanced economies should be “calibrated and clearly communicated”. This falls short of a coordinated approach of the G20 but will help calm markets by promising greater predictability.

Developing countries would also take satisfaction over the G20 consensus, reflected in the declaration that the profits of transnational corporations should be taxed in the country where they are generated. African countries, in particular, have been victims of the tax avoidance practices of such companies.

An Indian proposal to create an infrastructure financing facility at the World Bank to extend funding for infrastructure projects in developing countries will be the subject of a study. However, in a situation of financial stringency in most developed economies, it is doubtful whether any significant financing window for this purpose will see the light of day soon.

The leaders of BRICS (Brazil, Russia, India, China and South Africa) met on the sidelines of the G8 summit. Their deliberations focused on two landmark initiatives which were announced at their fifth regular summit in Durban on Mar. 27.

On the New Development Bank (NDB) it has been agreed that its initial capital will be 50 billion dollars, a somewhat modest amount given the expectations aroused when the proposal was first made. India had wanted a figure closer to 100 billion dollars.

It is still not clear how the equity will be distributed among the five partners. China has been willing to contribute a larger share but it is reported that Russia wanted each to have an equal share. South Africa is unable to contribute a significant amount given the smaller size of its economy.

On the Contingency Reserve Arrangement (CRA), the leaders announced a figure of 100 billion dollars, with China contributing 41 billion, Brazil, India and Russia 18 billion each, and South Africa five billion.

The CRA will serve as a multi-country currency swap mechanism which will help the BRICS deal with balance of payments problems. It is similar to the Chiang Mai initiative among ASEAN, China, Japan and South Korea, but which is currently 240 billion dollars and partially linked to a parallel though partial International Monetary Fund aid programme.

Whether the CRA will follow a similar pattern is not yet clear. Nevertheless China’s role as a leading partner among the BRICS is now amply apparent. It is possible that the equity distribution in the NDB may follow a similar pattern.

It may be noted that none of the BRICS members forms part of the U.S.-sponsored Trans Pacific Partnership (TPP) or the Trans-Atlantic Trade and Investment Partnership (TTIP) – regional trade arrangements which will fragment the global trading system and marginalise the emerging economies. It is surprising, therefore, that this challenge did not figure in the deliberations of the BRICS nor at the G-20 either.

China’s pre-eminence in the BRICS is a trend likely to be reinforced with the current economic slowdown and economic difficulties being faced by most emerging economies, in particular Brazil, India and South Africa.

Russia is a special case, not an emerging economy in the same category as the other BRICS members. It has escaped economic distress thanks to rising energy prices in the wake of spreading turmoil in the Middle East.

China’s economy is likely to decelerate in the coming months. Its growing debt, now over 200 percent of GDP, is causing concern. If the Chinese economy undergoes a major crisis as some analysts predict, its role as the prime mover in BRICS would certainly diminish.

For the present, however, China, with its seven percent growth and its three trillion dollars of foreign exchange reserves, is likely to be acknowledged as the most emerged of the emerging countries.

(END/COPYRIGHT IPS)

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Russia Throws Obama a Life Preserver on Syriahttp://www.ipsnews.net/2013/09/russia-throws-obama-a-life-preserver-on-syria/?utm_source=rss&utm_medium=rss&utm_campaign=russia-throws-obama-a-life-preserver-on-syria http://www.ipsnews.net/2013/09/russia-throws-obama-a-life-preserver-on-syria/#comments Tue, 10 Sep 2013 00:28:58 +0000 Jim Lobe http://www.ipsnews.net/?p=127398 By Jim Lobe
WASHINGTON, Sep 10 2013 (IPS)

With President Barack Obama facing increasingly certain defeat in his quest for Congressional authorisation to carry out military strikes against Syria, the Russian government Monday appeared to offer the White House a way out of the crisis.

Seizing on what seemed to be an offhand remark by Secretary of State John Kerry during a London press conference, Russian Foreign Minister Sergey Lavrov pledged that Moscow would support any effort to put Syria’s chemical weapons under international control and eventually destroy them.

Lavrov was meeting in the Russian capital with Syrian Foreign Minister Walid Al-Muallem, who immediately “welcome(d)” the idea.

The proposal, which in the course of the day was also embraced by U.N. Secretary-General Ban Ki-moon and French Foreign Minister Laurent Fabius, appeared initially to provoke as much scepticism among administration officials here as it did when Kerry first raised the idea in response to a question of what Damascus could do to avoid military action.

“Sure, he could turn over every single bit of his chemical weapons to the international community in the next week – turn it over, all of it, without delay and allow the full and total accounting,” Kerry replied. “But he isn’t about to do it, and it can’t be done.”

After Lavrov’s endorsement, State Department spokesperson Marie Harf asserted that Kerry “was not making a proposal” but was instead offering a “rhetorical statement about a scenario that we think is highly unlikely.” She said Washington was prepared to take a “hard look” at the idea which, said, should be met with “serious, deep scepticism”.

But, by mid-afternoon, that scepticism appeared to turn more to hope as former secretary of state Hillary Clinton, emerging from a White House meeting with Obama himself, called the plan an “important step” in defusing the crisis.

In an interview aired on the Public Broadcasting System’s Newshour Monday evening, Obama also suggested Washington would take it seriously.

“(M)y intention throughout this process has been to ensure that the blatant use of chemical weapons that we saw doesn’t happen again,” he said. “If in fact there’s a way to accomplish that diplomatically, that is overwhelmingly my preference. And you know, I have instructed John Kerry to talk directly to the Russians and run this to ground.

“And if we can exhaust these diplomatic efforts and come up with a formula that gives the international community a verifiable, enforceable mechanism to deal with these chemical weapons in Syria, then I’m all for it.”

The day’s surprising turn of events came amidst growing indications that, absent some unanticipated move, Obama faced a major political defeat in Congress over his requested authorisation despite the support of the most of the Congressional leadership of both parties and an all-out lobbying effort by his administration, the powerful American Israel Public Affairs Committee (AIPAC), and prominent neo-conservatives and former senior officials of the George W. Bush administration.

As of Monday, Obama took personal leadership of the effort, taping interviews on virtually all of the major television network and cable news programmes, in addition to PBS, and preparing a major policy address to the nation Tuesday evening.

According to a number of published reports earlier Monday, a vote in the Democratic-led Senate, which could come as early as Thursday, was expected to be extremely close despite the apparent support of a majority of the Democratic caucus there.

But in the Republican-led House, the authorisation faced almost certain defeat with even a majority of Democrats considered likely to vote “no”, while opposition to the measure among Republicans, despite their leadership’s support, was believed to be much greater.

“If I were the president, I would withdraw my request for the authorisation at this particular point,” said Democratic Rep. Jim McGovern, a liberal Democrat who has generally – if somewhat reluctantly – supported Obama on foreign-policy issues, said on CNN’s “State of the Union” public affairs programme Sunday.

Congressional opposition is strongly bolstered by the latest polling that shows that, if anything, Obama’s case for attacking Syria has lost ground significantly among voters across the country over the past week.

According to a Pew Research Center/USA Today survey conducted Sep. 4-8 and released Monday, 63 percent of respondents said they oppose a strike – 15 percent more than a week ago. Of that 63 percent, 45 percent said they are “strongly oppose(d)” to military action.

Despite the enlistment last week of former senior Bush officials in the administration’s lobbying effort, the erosion of support among grassroots Republicans has been especially severe. Four in 10 self-identified Republicans said they opposed strikes in the earlier poll; as of Sunday, seven in 10 Republicans voiced opposition.

Opposition has also grown among the independents, according to survey, with two-thirds now opposed, up from half the weekend before.

A less detailed CNN/ORC poll conducted over the past weekend gained a somewhat more-favourable result for the administration, with 59 percent of respondents voicing opposition and 39 percent in favour. Only 28 percent of Pew respondents said they favoured airstrikes against Syria.

Moreover, 71 percent of the CNN respondents said Obama should not attack Syria if Congress fails to pass the authorisation. In the Pew poll, 61 percent of respondents said Congress – not Obama -should have the final say on whether to take military action.

If domestic support for strikes appeared to plunge, Obama was not doing much better on the international front.

He was embarrassed last week when only half of the leaders of the Group of 20 (G20) – five of which (the U.S., Britain, France, Saudi Arabia, and Turkey) have been aiding Syrian rebels for some time – meeting in St. Petersburg, Russia signed on to a statement expressing support for “efforts undertaken by the United States and other countries to reinforce the prohibition on the use of chemical weapons” although it not explicitly endorse military action.

On Monday, the White House announced that 14 other countries had signed on – far less than the “several dozen” that, according to unnamed administration officials and Congressional supporters, allegedly support U.S. military action. Of the 14, the only G20 member was Germany; the others included mainly Central European nations, the three Baltic states, Denmark, Qatar, the United Arab Emirates, Morocco, and Honduras.

In this context, the possibility that the U.S. and Russia, Assad’s most important international supporter, could agree on a plan that would satisfy U.S. demands to eliminate any possibility that the regime could use chemical weapons would appear to be particularly attractive to Obama.

Early indications suggest that the administration will, as Clinton argued, use the proposal’s timing to persuade reluctant lawmakers to pass the authorisation in order to maintain pressure on Moscow and Damascus to follow through.

“It could be used either way; it could take the steam out of the administration’s lobbying effort or give it a new argument for making military action appear more credible if they don’t co-operate,” one lobbyist opposed to military strikes told IPS.

The idea that Syria would give up its chemical weapons arsenal to avoid an attack was circulated quietly on Capitol Hill by Democratic Sen. Joe Manchin last week in the form of an alternative resolution which demanded that Damascus sign and comply with the Chemical Weapons Convention (CWC) within 45 days or face an attack.

Some lawmakers reportedly objected to the idea because it would implicitly put pressure on Israel, which signed the treaty in 1993 but never ratified it, making it, along with Syria, the two Koreas, Egypt, Angola, and Myanmar, one of seven non-member states worldwide.

Jim Lobe’s blog on U.S. foreign policy can be read at Lobelog.com.

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Obama Increasingly Isolated on Syria Military Actionhttp://www.ipsnews.net/2013/09/obama-increasingly-isolated-on-syria-military-action/?utm_source=rss&utm_medium=rss&utm_campaign=obama-increasingly-isolated-on-syria-military-action http://www.ipsnews.net/2013/09/obama-increasingly-isolated-on-syria-military-action/#comments Fri, 06 Sep 2013 23:53:20 +0000 Jim Lobe http://www.ipsnews.net/?p=127351 Some analysts suggest that Obama’s failure to line up support from more G20 leaders suggests that the U.S.-created global order is no longer sustainable. Credit: Official White House Photo by Pete Souza

Some analysts suggest that Obama’s failure to line up support from more G20 leaders suggests that the U.S.-created global order is no longer sustainable. Credit: Official White House Photo by Pete Souza

By Jim Lobe
WASHINGTON, Sep 6 2013 (IPS)

With a week of intense lobbying behind him, U.S. President Barack Obama looks increasingly beleaguered – both at home and abroad – in his effort to rally support for a military strike against Syria to punish its government for its alleged Aug. 21 chemical-weapons attack outside Damascus.

At home, most political observers say Obama faces a particularly difficult task in bringing a majority of the Republican-led House of Representatives, which begins debating his proposed Authorisation for the Use of Military Force (AUMF) next week on return from its August recess, over to his side.“The lack of consensus within G20 is confirmation of what we already knew, which is that there is limited support for military action in Syria within the international community." -- Charles Kupchan of the Council on Foreign Relations

Congressional offices, even those whose bosses favour Obama’s position, are reporting overwhelming opposition in telephone calls and emails from their constituents, while public meetings held by lawmakers in their home districts have been dominated by anti-intervention forces from both the right and the left.

And polls released over the past week suggest that the administration has made little headway in moving public opinion its way.

A new Gallup poll taken at mid-week and released Friday found that support for U.S. military action “to reduce Syria’s ability to use chemical weapons” – 36 percent – was the lowest on the eve of any military intervention Washington has undertaken in the last 20 years. Fifty-one percent of respondents opposed a strike.

In a reflection of White House concern over opposition to military action, Obama himself announced Friday that he will address the nation about his intentions Tuesday. At a press conference at the Group of 20 (G20) meeting in St. Petersburg, Russia, he acknowledged that getting both house of Congress to approve an authorisation was “going to be a heavy lift”.

He spoke just after his deputy national security adviser, Tony Blinken, told National Public Radio (NPR) that, even though Obama retained the constitutional authority to strike Syria without Congressional authorisation, “it’s neither his desire nor intention to use that authority absent Congress backing him.”

Meanwhile, on the international front, Obama also appeared to be faring poorly in his bid to gain support for military action.

In St. Petersburg, The White House released a “joint statement” signed by the leaders of only 10 members, including the U.S., of the G20 plus Spain voicing “support efforts undertaken by the United States and other countries to reinforce the prohibition on the use of chemical weapons” and calling for “those who perpetrated these crimes (to be) held accountable.” The statement stopped short, however, of endorsing military action.

The signatories included the leaders of Australia, Britain, Canada, France, Italy, Japan, South Korea, Saudi Arabia, Turkey, as well as the U.S. Absent from the list, however, were all members of the BRICS bloc – Brazil, Russia, India, China, and South Africa – as well as Argentina, Indonesia, Mexico, and Germany.

The European Union (EU), a G20 member in its own right, also did not sign due to a lack of consensus among its membership.

Independent observers described the statement as a serious setback not only to Washington’s efforts to rally international support.

“It seems to have been a remarkable investment of American diplomatic energy not to have achieved the support of even a majority of the G20, and they tried to give the appearance of half plus one through sleight of hand,” noted Daniel Levy, the director of the Middle East and North Africa Programme at the London-based European Council on Foreign Relations (ECFR), who pointed to larger problems caused by the way the administration has acted over the Syria issue.

“Look at the institutions they’ve weakened in this process: the U.N. Security Council itself; the European Union by implicitly underlining its failure to gain consensus; the Arab League where the three most populous Arab states – Egypt, Iraq and Algeria – have all come out against military action; and even the G20 – all in order to achieve a statement that is far from an unequivocal endorsement of American military action,” he told IPS.

Charles Kupchan, a senior fellow at the Council on Foreign Relations (CFR), also suggested that the administration’s latest diplomatic move underscored its weakness on the issue.

“The lack of consensus within G20 is confirmation of what we already knew, which is that there is limited support for military action in Syria within the international community,” he said.

Back at home, advocates of military action, the most vocal of whom are pro-Israel activists and organisations worried that Congress’ failure to back up Obama’s threats against Syria will embolden Iran and its regional allies, are increasingly making the argument that both the president’s and Washington’s international credibility is at stake.

“This is not longer just about the conflict in Syria or even the Middle East,” wrote former Sens. Joe Lieberman and Jon Kyl, co-chairmen of the American Internationalism Project of the American Enterprise Institute (AEI), a neo-conservative think tank that played a leading role in championing the 2003 invasion of Iraq.

“It is about American credibility. Are we a country that our friends can trust and our enemies fear? Or are we perceived as a divided and dysfunctional superpower in retreat, whose words and warnings are no longer meaningful?” they asked in an op-ed entitled “Inaction on Syria Threatens U.S. Security” published by the Wall Street Journal Friday.

Failure to authorise a strike will be a “green light” for Iran to “speed toward nuclear weapons” and “confirm the worst fears of our ally, Israel, and moderate Arab states like Jordan that the U.S. cannot be relied upon to stand by its commitments. This will dramatically raise the risks of a regional war that could upend the global economy,” they stressed.

But others have argued that the credibility argument is overdrawn in this case.

“We heard this argument many, many times before, and always when the objective case for war was weak,” according to Stephen Walt, a prominent international relations expert at Harvard University. “To refrain from using force when vital interests are not at stake and when bombing could make things worse is not weakness; it is good sense.

“The United States has fought five wars since the Cold War ended and is using drones and special forces in several countries already,” he told IPS. “Nobody is going to question U.S. credibility when its interests are genuinely engaged and it has a clear objective in mind.”

Some liberal interventionists, notably Secretary of State John Kerry in his various public remarks, have also stressed the credibility argument, arguing that Washington’s failure to act could have profound implications for world order.

“For better or worse…” William Galston of the Brookings Institution argued in the Journal earlier this week, “the United States is the guarantor of the global order, which we took the lead in creating.

“Mr. Obama will need to convey this idea to the American people …from the Oval office,” he wrote.  “He must be prepared to go all-in to win what is shaping up as a tough fight on Capitol Hill. One thing is clear: A loss would shatter his presidency, and a lot more.”

But Kupchan said Obama’s failure to line up support from more G20 leaders suggested that the U.S.-created global order was no longer sustainable in any case.

“It’s clear confirmation of the degree to which there is a fundamental difference in geopolitical perspective between developed and emerging powers,” he told IPS.

“That the BRICS countries voted as a bloc is a sign of how difficult it’s going to be to fashion international consensus as global power continues to diffuse.”

Jim Lobe’s blog on U.S. foreign policy can be read at Lobelog.com.

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OECD Proposes Plan to Curb International Tax Avoidancehttp://www.ipsnews.net/2013/07/oecd-proposes-plan-to-curb-international-tax-avoidance/?utm_source=rss&utm_medium=rss&utm_campaign=oecd-proposes-plan-to-curb-international-tax-avoidance http://www.ipsnews.net/2013/07/oecd-proposes-plan-to-curb-international-tax-avoidance/#comments Fri, 19 Jul 2013 22:52:50 +0000 Carey L. Biron http://www.ipsnews.net/?p=125881 By Carey L. Biron
WASHINGTON, Jul 19 2013 (IPS)

Finance ministers from the Group of 20 (G20) countries on Friday received a previously requested strategy under which the world’s largest economies could crack down on international tax avoidance, particularly on the part of multinational corporations.

The 15-point action plan was created by the Organisation for Economic Cooperation and Development (OECD), a Paris-based think tank funded by the world’s richest countries. The G20 requested the study in February, as tax avoidance has moved to the top of the global agenda, particularly in the context of governments struggling to fill state coffers in the aftermath of the global economic downturn."When multinational corporations game the system – and the evidence shows that they are – everyone else loses." -- Nicole Tichon of the Tax Justice Network USA

Yet some analysts have also suggested that, against the backdrop of countries such as Brazil, China, India and Russia quickly becoming some of the world’s most powerful economies, the current exercise could be developed countries’ last attempt to steer the conversation on international tax policy.

“The joint challenges of tax evasion and tax base erosion lie at the heart of the social contract,” Angel Gurria, secretary-general of the OECD, said Friday in Moscow, where he handed over the new blueprint to government officials gathered ahead of the G20 summit in September, which Russia is hosting.

“Our citizens are demanding that we tackle offshore tax evasion by wealthy individuals and re-vamp the international tax system to prevent multinational enterprises from artificially shifting profits, resulting in very low taxes or even double non-taxation and thereby eroding our tax base.”

The OECD strategy would now seek to strengthen coherence among its members’ tax systems, aimed at filling the gaps between those systems – through which multinational corporations, in particular, have become adept at slipping.

A major thrust of the new strategy deals with ways to corral the new powerhouses of the digital economy, which in recent years have become adept at extremely complex – some say only marginally legal – tax strategies. Such companies, making use of extensive offshore subsidiaries, have recently been the focus of a strengthened tax-avoidance discussion here in the United States and in Europe.

The action plan, which the OECD says it will roll out over a two-year rulemaking process, also tries to increase transparency. It would require companies to engage in country-by-country reporting of profits, for instance, in order to make it more difficult for phony “shell” offices to quietly shift profits made in one country to another that offers lower or nonexistent tax rates.

On Friday, Gurria noted that these 15 actions would “result in the most fundamental change to the international tax rules since the 1920s!”

Built on an earlier general report, the plan received widespread initial plaudits from government officials. Russian Finance Minister Anton Siluanov “commended” the report for hewing to “the basic tenets of fairness – that it allows multinational corporations to prosper without loading a higher tax burden on domestic companies and individual taxpayers.”

U.S. Treasury Secretary Jacob J. Lew also “welcomed” the action plan, which he said was created in part with U.S. participation.

“This is a major step toward addressing tax avoidance by multinational firms in the global economy and represents a concerted effort to raise standards around the world,” Lew noted in a statement sent to IPS. “We must address the persistent issue of ‘stateless income’, which undermines confidence in our tax system at all levels.”

Entrenching global inequality?

Yet the plan received a more cautious appraisal from certain civil society organisations, with some warning that the OECD’s membership has led it to overlook the importance of developing countries in combating tax avoidance in today’s context. Indeed, it is in these countries where illicit outflows of capital are having major, damaging impacts on already strapped governments’ abilities to fund their public sectors.

“We are encouraged to see this unequivocal acknowledgement that when multinational corporations game the system – and the evidence shows that they are – everyone else loses: governments, citizens and other businesses,” Nicole Tichon, executive director of the Tax Justice Network USA, an advocacy group here, told IPS.

“We agree that this is a global problem and will require a global solution, but this plan needs to more carefully consider the additional plight of developing countries.”

One of Tichon’s colleagues in Africa expanded on this point.

“In poor nations we are largely failing to capture tax revenue from major international corporations which should be harnessed to ensure better social and economic opportunities for citizens,” Alvin Mosioma, the director of Tax Justice Network Africa, says.

“This is why the current OECD reform process needs to include at its heart serious representation from developing nations rather than keeping them to the margins. That developing countries are kept out of this key process runs the real risk of further entrenching global inequality.”

Others are taking issue with the new plan’s failure to recommend that country-by-country reporting of corporate profits – seen as a critical tool in halting the currently rampant shifting of earnings among multinational companies – be made public.

According to the OECD’s top tax official, the action plan does recommend such reporting, but he admits that those reports would not be publicised.

“This country-by-country reporting will be for tax administrations and not [the] public,” Pascal Saint-Amans, director of the OECD’s Centre for Tax Policy and Administration, told IPS.

“What matters is that tax inspectors have the information. Confidentiality issues [could stop] countries from agreeing to public country-by-country reporting.”

Indeed, a similar fight is currently taking place here in the United States, which last year instituted a landmark regulation requiring multinational companies to publicly report all payments made to foreign governments. Yet earlier this month a court overturned that rule in part because of the requirement that these reports be made public.

Some anti-poverty groups are going so far as to suggest that the OECD’s tax fixes are already obsolete, having been far outstripped by the decentralised model that the most aggressive modern corporations have been able to follow.

“This plan is papering over the cracks in a broken system, rooted in an outdated and irrelevant model of corporate taxation,” Murray Worthy, a tax campaigner at War on Want, an advocacy group, said in a statement. “It might be able to tackle the worst of corporate tax dodging, but it won’t fix the system.”

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