The road to Baradares in north central Haiti. The aim of the new draft mining law appears to be a massive expansion of Haiti’s mining sector. Credit: Lee Cohen/cc by 2.0

By Carey L. Biron
WASHINGTON, Jan 13 2015 (IPS)

With Haiti’s Parliament having dissolved on Tuesday, civil society groups are worried that the Haitian president may move to unilaterally put in place a contentious revision to the country’s decades-old mining law.

Starting in 2013, that draft was written with technical assistance from the World Bank. Last week, a half-dozen Haitian groups filed a formal appeal with the bank’s complaints office, expressing concern that the legislation had been crafted without the public consultation often required under the Washington-based development funder’s own policies.“The process has been very opaque, with a small group of experts from the World Bank and Haitian government officials drafting this law.” -- Sarah Singh

The aim of the new draft mining law appears to be a massive expansion of Haiti’s mining sector, paving the way for the entry of foreign companies already interested in the country’s significant gold and other deposits.

“Community leaders … are encouraging communities to think critically about ‘development’, and to not simply accept projects defined by outsiders,” Ellie Happel, an attorney in Port-au-Prince who has been involved in the complaint, told IPS.

“These projects often fail. And, in the case with gold mining, residents learn that these projects may threaten their very way of life.”

Haiti’s extractives permitting process is currently extensive and bureaucratic. Yet the new revisions would bypass parliamentary oversight altogether, halting even a requirement that agreement terms be made public, according to a draft leaked in July.

Critics worry that this streamlining, coupled with the Haitian government’s weakness in ensuring oversight, could result in social and environmental problems, particularly damaging to a largely agrarian economy. Further, there is question as to whether exploitation of this lucrative minerals wealth would benefit the country’s vast impoverished population.

“The World Bank’s involvement in developing the Draft Mining Law lends the law credibility, which is likely to encourage investment in the Haitian mining sector,” the complaint, filed with the bank’s Inspection Panel on Wednesday, states.

“[T]his increased investment in the mining sector will result in … contamination of vital waterways, impacts on the agriculture sector, and involuntary displacement of communities. Complainants are also concerned about the exclusion of Haitian people from the law reform process, particularly when contrasted with the reported regular participation of the private sector in drafting the new law.”

An opaque process

The complaint comes five years after a devastating earthquake struck Haiti, and as political instability is threatening reconstruction and development progress made in that catastrophe’s aftermath. Elections have been repeatedly put off for more than two years, and by Tuesday so many members of Parliament are slated to have finished their terms that the body would lack a quorum.

On Sunday Haitian President Michel Martelly indicated that a deal might be near. But the leftist opposition was reportedly not part of this agreement, and has repeatedly warned that the president is planning to rule by decree.

The Inspection Panel complaint, filed by six civil society groups operating under the umbrella Kolektif Jistis Min (the Justice in Mining Collective), contextualises its concerns against this backdrop of instability. “[T]he Haitian government may be poised to adopt the Draft Mining Law by decree, outside the democratic process,” it states.

Even if the political crisis is dealt with soon, concerns with the legislation’s drafting process will remain.

The Justice in Mining Collective, which represents around 50,000 Haitians, drew up the complaint after the draft mining law was leaked in July. No formal copy of the legislation has been made public, nor has the French-language draft law been translated into Haitian Creole, the most commonly spoken language.

“The process has been very opaque, with a small group of experts from the World Bank and Haitian government officials drafting this law,” Sarah Singh, the director of strategic support with Accountability Counsel, a legal advocacy group that consulted on the complaint and is representing some Haitian communities, told IPS.

“They’ve had two meetings that, to my knowledge, were invite-only and held in French, at which the majority of attendees were private investors and some big NGOs. Yet the bank’s response to complaints of this lack of consultation has been to say this is the government’s responsibility.”

The Justice in Mining Collective is suggesting that this lack of consultation runs counter to social and environmental guidelines that undergird all World Bank investments. These policies would also call for a broad environmental assessment across the sector, something local civil society is now demanding – to be followed by a major public debate around the assessment’s findings and the potential role large-scale mining could play in Haiti’s development.

Yet the World Bank is not actually investing in the Haitian mining sector, and it is not clear that the institution’s technical assistance is required to conform to the safeguards policies. In a November letter, the bank noted that its engagement on the Haitian mining law has been confined to sharing international best practices.

Yet Singh says she and others believe the safeguards do still apply, particularly given the scope of the new legislation’s impact.

“This will change the entire legal regime,” she says. “The idea that bank could do that and not have the safeguards apply seems hugely problematic.”

A World Bank spokesperson did confirm to IPS that the Inspection Panel has received the Haitian complaint. If the panel registers the request, she said, the bank’s management would have around a month to submit a response, following which the bank’s board would decide whether the complaint should be investigated.

Parliamentary moratorium

Certainly sensitivities around the Haitian extractives sector have increased in recent years.

Minerals prospecting in Haiti has expanded significantly over the past half-decade, though no company has yet moved beyond exploration. In 2012, when the government approved its first full mining permit in years, the Parliament balked, issuing a non-binding moratorium on all extraction until a sector-wide assessment could take place.

Meanwhile, Haitians have been looking across the border at some of the mining-related problems experienced in the Dominican Republic, including water pollution. Civil society groups have also been reaching out to other countries in the Global South, trying to understand the experiences of other communities around large-scale extractives operations.

Current views are also being informed by decades of historical experience in Haiti, as well. Since the country’s independence in the early 19th century, several foreign companies have engaged many years of gold mining.

That was a “negative, even catastrophic, experience,” according to a statement from the Justice in Mining Collective released following the leak of the draft mining law in July.

“Mining exploitation has never contributed to the development of Haiti. To the contrary, the history of gold exploitation is one marked by blood and suffering since the beginning,” the statement warned.

“When we consider the importance of and the potential consequences of mineral exploitation, we note this change in the law as a sort of scandal that may facilitate further looting, without even the people aware of the consequences.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

An unprecedented number of United Nations special rapporteurs and independent experts are raising pointed concerns over the World Bank’s ongoing review of its pioneering environmental and social safeguards, particularly around the role that human rights will play in these revamped policies.

In a letter made public Tuesday, 28 U.N. experts raise fears that the Washington-based development funder could foster a “race to the bottom” if proposed changes go forward. The document accuses the bank of selective interpretation of its own charter and its obligations under international law.“The bank is not just any old actor in relation to these issues. It is the gorilla in the room.” -- U.N. Special Rapporteur Philip Alston

“[B]y contemporary standards the [safeguards revision] seems to go out of its way to avoid any meaningful references to human rights and international human rights law, except for passing references,” the letter, addressed to World Bank Group President Jim Yong Kim, states.

“[T]he Bank’s proposed new Safeguards seem to view human rights in largely negative terms, as considerations that, if taken seriously, will only drive up the cost of lending rather than contributing to ensuring a positive outcome.”

The World Bank says its safeguards constitute a “cornerstone of its support to sustainable poverty reduction”, and the institution is currently updating these policies for the first time in two decades. Yet when the bank released a draft revision of those changes in July, the proposal set off a firestorm of criticism across civil society.

Critics warn that the revisions would allow the World Bank to shift responsibility for adherence to certain social and environmental policies on to loan recipients, while prioritising self-monitoring over up-front requirements. The new guidelines could also exempt recipient governments from abiding by certain aspects of the policies.

The bank has since extended the period intended to gather response to the draft, which was supposed to end this month, through this coming spring.

“The bank is not just any old actor in relation to these issues. It is the gorilla in the room,” Philip Alston, the U.N. Human Rights Council’s special rapporteur on extreme poverty and human rights, told IPS. “What it does on safeguards, and what it doesn’t do on human rights, makes a huge difference in terms of setting global standards.”

The letter, which Alston spearheaded, is a rarity in multiple ways. Not only are formal missives from the U.N. human rights system to the World Bank uncommon, but close observers say that no such previous letter has garnered the support of so many U.N. rights experts.

Those who signed the letter “are deeply concerned that the bank is planning to turn the clock back 20 years or more,” Alston says, “and replace its existing standards with a system that will simply pass the blame for ignoring human rights considerations on to others, thus letting the bank off the hook.”

Competitive pressures

Since the 1970s, the World Bank has been a pioneer in working to ensure that its development assistance does not lead to or exacerbate certain forms of discrimination or environmental degradation.

Yet the institution has never mandated that the programmes it funds comply with international human rights standards, largely on the concern that politicising the bank’s lending could complicate its country-by-country anti-poverty focus. (Others, including Alston, maintain that human rights can no longer be considered a political issue.)

Consensus is growing, however, around the idea that sustainable development is impossible without a specific focus on human rights. Other multilateral institutions, including the U.N. Development Programme, have explicitly brought their assistance guidelines in line with international human rights obligations.

At the same time, the World Bank is experiencing greater competitive pressure. According to many analysts, including this week’s letter, this is due to the recent creation of several new multilateral development lenders, funded particularly by fast-rising economies including China, Russia and India.

These entities are widely expected to put less emphasis on prescriptive and at times laborious requirements such as the World Bank’s environmental and social safeguards. In such a context, however, Alston and others say the bank has an added responsibility to focus on the results that, they suggest, only core respect for human rights can bring.

The bank’s management counters that the institution has been a leader in highlighting the interdependence between respect for human rights and development outcomes for at least two decades. Today, officials involved with the safeguard review maintain that both human rights and non-discrimination principles have been expanded upon in the new draft.

“Our draft proposal goes as far or further than any other multilateral development bank in the degree to which it protects the vulnerable and the marginalized,” Stefan Koeberle, the bank’s director of operations risk, told IPS in a statement.

“We are currently engaged in extensive consultations on the draft, and we have received a variety of constructive proposals to strengthen the language further. We will continue to carry out our role as an organization charged with achieving poverty reduction and shared prosperity, through sound policies that achieve beneficial environmental, social, and economic outcomes for all concerned.”

U.S. leadership?

The concerns voiced by the U.N. experts come just after three U.S. lawmakers told the Obama administration that the World Bank’s safeguards revision were resulting in a “dilution of existing protections”.

In a letter to U.S. Treasury Secretary Jacob Lew, the lawmakers note that a November evaluation by an Asian Development Bank (ADB) auditor had “foreshadowed” some of these concerns. The trio urged U.S. intervention.

“The Department of Treasury has a history of successfully leading coalitions that call upon regional and national development banks to implement strong safeguards,” the letter states.

“We expect the Treasury to demonstrate similar leadership in this case, so that the World Bank’s safeguards are at least as strong as the strongest safeguards of the ADB and other multilateral financial institutions.”

The United States is the World Bank’s largest member, and watchdog groups say the new flurry of formal critical response is significant.

“U.N. human rights experts and the U.S. Congress have joined the chorus of voices trying to shake the World Bank into finally recognising that human rights should be central to all that it does, and particularly in safeguarding against harm,” Jessica Evans, a senior advocate with Human Rights Watch, told IPS.

If the bank refuses to institutionalise “rigorous human rights due diligence,” Evans continues, “the only conclusion that can be drawn is that the World Bank wants to retain an ability to finance violations of international human rights law while complying with its own policies.”

Bank officials say the next draft of the safeguards revision should be made public by mid-2015.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

There is a broad spectrum of potential avenues for the illegal skimming from or shifting of profits in developing countries, carried out by criminal entities, corrupt officials and dishonest corporations. Credit: epSos .de/cc by 2.0

By Carey L. Biron
WASHINGTON, Dec 16 2014 (IPS)

Developing countries are losing money through illicit channels at twice the rate at which their economies are growing, according to new estimates released Tuesday. Further, the total volume of these lost funds appears to be rapidly expanding.

Findings from Global Financial Integrity (GFI), a watchdog group based here, re-confirm previous estimates that developing countries are losing almost a trillion dollars a year through tax evasion, corruption and other financial crimes. Yet in a new report covering the decade through 2012, GFI’s researchers show that the rate at which these illicit outflows are taking place has risen significantly.“If we take [these] findings seriously, we can address extreme poverty in our lifetimes.” -- Eric LeCompte

In 2003, for instance, cumulative illicit capital leaving developing countries was pegged at around 297 billion dollars. That’s significant, of course, but relatively little compared to the more than 991 billion now estimated for 2012 – a record figure, thus far.

In less than a decade, then, these illicit outflows more than tripled in size, totalling at least 6.6 billion dollars. GFI reports that this works out to an adjusted average growth of some 9.4 percent per year, or twice the average global growth in gross domestic product (GDP).

One of the most common mechanisms for moving this money has been the falsification of trade invoices.

“After turning down following the financial crisis, global trade is going up again and so it’s increasingly easy to engage in misinvoicing – a lot more people are coming to understand how to do this and are willing to indulge,” Raymond Baker, GFI’s president, told IPS.

“These rates are not only growing faster than global GDP but also faster than the rate of growth of global trade.”

Further, these estimates are likely conservative, and don’t cover a broad spectrum of data that is not officially reported – cash-based criminal activities, for instance, or unofficial “hawala” transactions.

Baker emphasises that these capital losses are a problem affecting the entire developing world. Yet given that illicit outflows run in tandem with a country’s broader interaction with global trade, these rates are particularly strong in the world’s emerging economies, led by China, Russia, Mexico and India.

There are also significant differentials between regions, both is size and the rate at which they’re increasing. In the Middle East and North Africa, for instance, illicit financial flows are growing far higher than the global average, at more than 24 percent per year.

Even in sub-Saharan Africa, home to some of the world’s poorest communities, these rates are growing at more than 13 percent per year. Such figures eclipse both foreign assistance and foreign investment – indeed, the 2012 figure was more than 11 times the total development assistance offered on a global basis.

“If we take [these] findings seriously, we can address extreme poverty in our lifetimes,” Eric LeCompte, an expert to U.N. groups that focus on these issues, said Monday. “Countries need resources and if we curb these illicit practices, we can get the money where it’s needed most.”

Lucrative misinvoicing

There is a broad spectrum of potential avenues for the illegal skimming from or shifting of profits in developing countries, carried out by criminal entities, corrupt officials and dishonest corporations. And for the first time, certain of these key issues are receiving new and concerted international attention.

Multiple nascent multinational actions are now unfolding aimed at cracking down particularly on tax evasion by transnational companies. New transparency mechanisms are in the process of being rolled by several multilateral groups, including the Group of 20 (G20) industrialized nations and the Organisation for Economic Cooperation and Development (OECD), a Paris-based grouping of rich countries.

Such initiatives are receiving keen attention from civil society groups, and would likely constrict these illicit flows. Yet in fact, GFI’s research suggests that the overwhelming method by which capital is illegally leaving developing countries is far more mundane and, potentially, complex to tackle.

This has to do with simple trade misinvoicing, in which companies purposefully use incorrect pricing of imports or exports to justify the transfer of funds out of or into a country, thus laundering ill-gotten finances or helping companies to hide profits. Over the past decade, the new GFI report estimates, more than three-quarters of illicit financial flows were facilitated by trade misinvoicing.

And this includes only misinvoicing for goods, not services. Likely the real figure is far higher.

Experts say that stopping misinvoicing completely will be impossible, but note that there are multiple ways to curtail the problem. First would be to ensure greater transparency in the global financial system, to eliminate tax havens and “shell corporations” and to require the automatic exchange of tax information across borders.

Efforts are currently underway to accomplish each of these, to varying degrees. Last month, leaders of the G20 countries agreed to begin automatically sharing tax information by the end of next year, and also committed to assist developing countries to engage in such sharing in the future.

GFI’s Baker says that developing countries need to bolster their customs systems, but notes that other tools are already readily available to push back against trade misinvoicing.

“There is a growing volume of online pricing data available that can be accessed in real time,” he says. “This gives developing countries the ability to look at transactions coming in and going out and to get an immediate idea as to whether the pricing accords with international norms. And if not, they can quickly question the transaction.”

Development goal

There is today broad recognition of the monumental impact that illicit financial flows have on poor countries’ ability to fund their own development. Given the centrality of trade misinvoicing in this problem, there are also increasing calls for multilateral action to take direct aim at the issue.

In particular, some development scholars and anti-poverty campaigners are urging that a related goal be included in the new Sustainable Development Goals (SDGs), currently under negotiation at the United Nations and planned to be unveiled in mid-2015.

Under this framework, GFI is calling for the international community to agree to halve trade-related illicit flows within a decade and a half. The OECD is hosting a two-day conference this week to discuss the issue.

“We’re not talking about an aspirational goal but rather a very measurable goal. That’s doable, but it will take political will,” Baker says.

“We think the SDGs should incorporate very specific, targetable goals that can have huge impact on development and helping developing countries keep their own money. In our view, that’s the most important objective.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Survivors at a workshop in Pader, northern Uganda. Thousands of women were raped during Uganda’s civil war but there have been few government efforts to assist them. Credit: Rosebell Kagumire/IPS

By Carey L. Biron
WASHINGTON, Dec 10 2014 (IPS)

Nearly two dozen health, advocacy and faith groups are calling on President Barack Obama to take executive action clarifying that U.S. assistance can be used to fund abortion services for women and girls raped in the context of war and conflict.

The groups gathered Tuesday outside of the White House to draw attention to what they say is an ongoing misreading by politicians as well as humanitarian groups of four-decade-old legislation. That law, known as the Helms Amendment, specifies women’s health services that can be supported by U.S. overseas funding."We want to prevent these acts but also, when that violence does occur, to make sure that organisations and government agencies are providing the necessary post-rape care, including legal and social services, as well as mental and physical health services. Abortion services need to be part of that package.” -- Serra Sippel

This mis-interpretation, advocates warn, results in ongoing mental suffering, social disgrace and even additional abuse for women who have been raped.

“For over 40 years, the Helms Amendment has been applied as a complete ban on abortion care in U.S.-funded global health programmes – with no exceptions,” Purnima Mane, the president of Pathfinder International, a group that works on global sexual health issues, said in comments sent to IPS.

“The result is that Pathfinder and other U.S. government-funded agencies are unable to provide critical abortion care services to those at risk even under circumstances upheld by U.S. law and clearly allowable under the Helms Amendment. With the stroke of a pen, President Obama can change the outcome for many of these women and start to reverse more than four decades of neglect of their basic human rights and harm to their health.”

Advocates say such an executive action would be in line with both the law and broader public opinion. Indeed, on the face of it, the Helms Amendment seems to be quite clear.

The amendment bans U.S. funding from being used to “pay for the performance of abortion as a method of family planning” or to “motivate or coerce any person to practice abortions.” While the law does not specifically bar U.S. assistance being used for abortion services in the case of rape, critics have long noted that this has been the impact since the start.

“No U.S. administration has ever implemented this correctly, in terms of making exemptions in certain instances,” Serra Sippel, the president of the Center for Health and Gender Equity (CHANGE) and a key organiser of Tuesday’s demonstration, told IPS.

“This comes down to politics and the political environment in Washington. But what we need is for the president to take leadership and direct USAID” – the federal government’s main foreign assistance agency – “and the State Department to say the U.S. government is taking a stand and supporting access to abortion in these cases.”

Misinterpretation, self-censorship

Abortion has been, and remains, one of the most divisive issues in U.S. politics. By many metrics, this polarisation has only worsened with time.

This came to the cultural and political forefront in 1973, when the U.S. Supreme Court ruled in a landmark decision that a state law banning abortion (except to save the mother’s life) was unconstitutional. The ruling resulted in a lasting moral outrage among broad sections of the U.S. public, though polls suggest that a majority of those in the United States support services following rape, incest or when a mother’s life is at risk.

The Helms Amendment was among the first legislative responses to the court’s ruling, passed just months later. Since then, the amendment has resulted in a discontinuation of U.S. assistance for all abortion services in other countries.

It is important to note that these procedures remain legal in the United States, as well as in many of the countries in which U.S.-funded entities, including government departments, are operating. Humanitarian groups often feel they cannot even make abortion-related information available to women, including those raped during conflict – even if the Helms Amendment doesn’t specifically proscribe doing so.

“These restrictions, collectively, have resulted in a perception that U.S. foreign policy on abortion is more onerous than the actual law … [leading to] a pervasive atmosphere of confusion, misunderstanding and inhibition around other abortion-related activities beyond direct services,” analysis published last year by the Guttmacher Institute, a sexual health-focused think tank here, reports.

“Wittingly or unwittingly, both NGOs and U.S. officials have been transgressors and victims alike in the misinterpretation and misapplication of U.S. anti-abortion law … whether through misinterpretation or self-censorship, NGOs are needlessly refraining from providing abortion counseling or referrals.”

Global statistics on conflict-time rapes and resulting pregnancies are hard to come by. Human Rights Watch points to 2004 research carried out in Liberia, where rape was used as a weapon of war, suggesting that around 15 percent of wartime rapes led to pregnancy.

“Human rights practitioners and public health officials from Bosnia, the Democratic Republic of Congo, Colombia, and other countries at war, have collected evidence from conflict rape survivors showing both that pregnancy happens and that it has devastating consequences for women and girls,” Liesl Gerntholtz, the executive director of a Human Rights Watch’s women’s rights division, wrote Tuesday.

“They are left to continue unwanted pregnancies and bear children they often cannot care for and who are daily reminders of the brutal attacks they suffered. This, in turn, makes these children more vulnerable to stigmatization, abuse, and abandonment.”

Global acknowledgment

On Tuesday, the groups participating in the White House demonstration also called on President Obama to clarify that the Helms Amendment does not apply to pregnancies resulting from incest or if the mother’s life is at risk. Yet the focus of the calls remains on rape in the context of war and conflict.

Advocates say public consciousness on this issue has risen significantly over the past year and a half. To a great extent, this has been driven by the conflict in Syria and the rise of the Islamic State, as well as the ongoing violence in the Democratic Republic of the Congo (DRC), and the centrality of sexual violence in each of these.

“We know that rape has been used as a weapon of war throughout history. What’s new is the attention from governments and advocates over the past 18 months,” CHANGE’s Sippel says.

“The prevention of violence cannot stand alone. We want to prevent these acts but also, when that violence does occur, to make sure that organisations and government agencies are providing the necessary post-rape care, including legal and social services, as well as mental and physical health services. Abortion services need to be part of that package.”

The United States has been a strong global advocate against sexual violence in recent years, including with regard to conflict situations. President Obama has created the first U.S. action plan on women’s role in peace-building, a White House strategy on gender-based violence, among other actions.

Advocates say that clarifying the Helms Amendment would be the next logical step. Although the White House was unable to comment for this story, organisers of Tuesday’s rally say President Obama’s aides did meet with advocates working on sexual violence in Colombia, the DRC and elsewhere.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Children from one of the communities in Ocean Division, southern Cameroon, who lost much of their forestland after the government leased it to a logging company. Credit: Monde Kingsley Nfor/IPS

By Carey L. Biron
WASHINGTON, Dec 9 2014 (IPS)

Just half of major global banks have in place a public policy to respect human rights, according to new research, despite this being a foundational mandate of an international convention on multinational business practice.

Further, of the 32 global banks examined, researchers found that none has publicly put in place a process to deal with human rights abuses, if identified. None has even created grievance mechanisms by which those impacted by potential abuses can complain to the banks.“The findings of this report are quite sobering about what can be expected from self-regulatory principles.” -- Aldo Caliari

The findings, published by BankTrack, an international network of watchdog groups, come three and a half years after the adoption of the United Nations Guiding Principles on Business and Human Rights. These principles, unanimously endorsed by the U.N. Human Rights Council in 2011, specify a range of actions and obligations for all businesses, including the financial sector.

Yet banks have a unique role in underwriting nearly all of the business activity around the globe, even as they are typically shielded from the impacts of those investments.

“Banks covered in this report have been found to finance companies and projects involving forced removals of communities, child labour, military backed land grabs, and abuses of indigenous peoples’ right to self-determination,” the report, released last week, states.

“Policies and processes, open to public scrutiny and backed by adequate reporting, are important tools for banks to ensure that these kinds of abuses do not happen, and that where they do, those whose rights have been impacted have the right to effective remedy … If these policies and procedures are to be meaningful, the finance for such ‘dodgy deals’ must eventually dry up.”

One of the banks studied in the new report, JPMorgan Chase, is one of the leading U.S. financiers of palm oil, through loans and equity investments. While the bank does have a human rights policy, BankTrack’s researchers find this policy applies only to loans, not investments.

“When it comes to reporting on implementation, the bank falls flat, making the policy little more than window-dressing,” Jeff Conant, an international forests campaigner with Friends of the Earth U.S., a watchdog group that is working on palm-oil financing, told IPS.

“We’ve spoken with JPMorgan Chase about the need to give impacted people an opportunity to file complaints about the human rights impacts of its financing, with the belief that this is a first step towards accountability. Frankly, from the bank’s response, I don’t see them stepping up anytime soon.”

While private finance today facilitates almost the full range of corporate activity, Conant notes, “the finance institutions themselves are wholly unaccountable.”

Sobering results

According to the new study, a few banks appear to be well on their way to conformity with the Guiding Principles. The top-ranked institution, the Dutch Rabobank, received a score of eight out of 12, with Credit Suisse and UBS close behind.

These are the exceptions, however. Against a set of 12 criteria, the average score was only a three.

Many scored at or near zero. While those ranked at the very bottom include several Chinese institutions, they also include banks in the European Union and the United States.

Indeed, Bank of America, one of the largest financial institutions in the world, scored just 0.5 out of 12, receiving a minor bump for having expressed some commitment to carrying out human rights-related due diligence. (The bank failed to respond to request for comment for this story by deadline.)

“The findings of this report are quite sobering about what can be expected from self-regulatory principles,” Aldo Caliari, the director of the Rethinking Bretton Woods Project at the Center of Concern, a Washington think tank, told IPS.

“The Guiding Principles are the bare minimum of any human rights framework in the corporate sector, a framework that has the companies’ consent. So the fact that there is so little [adherence to] such a relatively weak tool, where every effort to court corporations’ support has been made, is, indeed, very telling.”

Despite the spectrum of findings on implementation, the financial services industry as a whole has taken note of the Guiding Principles.

In 2011, four European banks met to discuss the principles’ potential implications for the sector. Three more banks eventually joined what is now called the Thun Group, and in October 2013 the grouping released an initial paper on the results of these discussions, including recommendations for compliance.

A previously existing set of voluntary guidelines for the banking sector, known as the Equator Principles, were also updated in 2013 to reflect the new existence of the Guiding Principles. So far, the Equator Principles have been signed by 80 financial institutions in 34 countries.

“To date, banks’ efforts to implement the UN Guiding Principles have mainly revolved around producing discussion papers on the best way forward,” Ryan Brightwell, the new report’s author, said in a statement.

“BankTrack has welcomed these discussions, but some three and a half years on from the launch of these Principles, it is time to move onto implementation.”

Strengthening accountability

The new findings on lagging implementation will strengthen arguments from those who want to tweak or supplant the Guiding Principles. Some suggest, for instance, that the framework be changed to treat financial institutions differently from other sectors.

“[T]he financial sector requires an exceptional treatment when it comes to the application of the Guiding Principles,” the Center of Concern’s Caliari wrote last year in comments for the Working Group on Business and Human Rights.

“Financial companies, more than other companies, have the potential, with their change of behaviour, to influence the behaviour of other actors. That means they also should be upheld to a greater level of responsibility when they fail to do so.”

Caliari and others are also part of a movement to move beyond voluntary frameworks such as the Guiding Principles (at least in their current form), and instead to see through the creation of a binding mechanism.

This decades-long effort received a significant boost in June, when the U.N. Human Rights Council voted to allow negotiations to begin toward a binding treaty around transnational companies and their human rights obligations. (This same session also approved a popular second resolution, aimed instead at strengthening implementation of the Guiding Principles process.)

The new data on banks’ relative lack of compliance with the Guiding Principles, Caliari says, is one of the reasons the call for a legally binding treaty “has been gaining ground.”

He continues: “It is increasingly clear that mechanisms that rely on the consent of the companies cannot be the total of available accountability mechanisms. More is needed.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

The World Bank has taken an unusual but highly visible step away from traditional economics, encouraging policymakers and development implementers to place far more emphasis on research into local human behaviour when drawing up plans and projects.

Such a focus would strengthen understanding on the ways in which habits, biases and collective impulses impact on interventions in, say, health, education or encouraging personal savings. The bank emphasises that such a focus is important for understanding the behavioural peculiarities of not just poor communities but also policymakers, including those within the World Bank itself.“If you know lots of people who pay taxes, you are more likely to pay taxes. That may be as important or more important as the likelihood of getting caught.” -- Varun Gauri, a co-director of the new WDR

These new prescriptions come in the bank’s most high-profile annual study, the World Development Report (WDR), which was formally released here on Thursday.

“[D]evelopment policy is due for its own redesign based on careful consideration of human factors,” the report states, noting that the analysis draws from findings in behavioural economics, cognitive science, anthropology and other fields.

“Because human decision making is so complicated, predicting how beneficiaries will respond to particular interventions is a challenge. The process of devising and implementing development policy would benefit from richer diagnoses of behavioural drivers … and early experimentation.”

The World Development Report is a thematic study, and since its introduction in the late 1970s has generally focused on issues of traditional priority for development policy – jobs, gender, agriculture, etc. Members of the World Bank’s leadership admit that the focus of this year’s WDR – formally subtitled “Mind, Society, and Behaviour” – was a gamble.

Yet they also say that a greater focus on human behaviour throughout the process of creating development policy could have a landmark impact on efficacy, efficiency and other goals that ultimately make the difference between a successful versus middling intervention.

“The use of these methods in the development policy world is very minimal, and all of the motivations for doing this World Development Report were precisely because of that deficiency,” Kaushik Basu, a senior vice president and chief economist at the bank, told IPS.

“So there’s real a possibility of … a paradigm adjustment, whereby governments, development practitioners and others make use of this new range of instruments available to improve delivery to the doorstep. I feel the scope for that is huge.”

Private sector lessons

Traditional economics views human decision-making as straightforward and rational, based on a clean mix of self-interest and logic. Yet the WDR cites copious research over the past decade or more indicating that, in fact, humans arrive at decisions due to a variety of factors, many of which are immediate and unrelated to the broader issue under consideration.

On the one hand, for instance, the World Bank points to research suggesting that poverty and crisis situations make it increasingly difficult for many people to make rational or long-term decisions. On the other hand, the report notes that people can often be “unexpectedly generous”.

The private sector, of course, has known about and directly exploited approaches offered by the behavioural and cognitive sciences for years. Indeed, rarely is a new advertisement or product publicly offered before being extensively considered from a variety of such perspectives.

Yet this is new territory for the bank, and for much of the development world.

“The World Bank is quite dogmatically wedded to the idea of free markets, information about pricing, rational decision-making. So for them to take a step back and highlight the additional information out there that might help remove limitations – that’s very good,” Hans Bos, the vice president and director of the International Development, Evaluation, and Research (IDER) programme at the American Institutes for Research, told IPS.

“What this report didn’t do very well is to explain the practical implications of following these approaches. In order to really know what is working in a local context you need to keep testing things, but we can’t spend three-quarters of the development budget on research. So we need to come up with a better way to do research.”

The World Bank is now hoping that by putting its stamp of approval on this body of research, and by using its global influence, it can spur additional related research. It is also hoping to convince development policymakers to take human behaviour – particularly local behaviour – into account when designing with new projects.

“For example, can simplifying the enrolment process for financial aid increase participation? Can changing the timing of fertilizer purchases to coincide with harvest earnings increase the rate of use?” the report asks.

“Can marketing a social norm of safe driving reduce accident rates? Can providing information about the energy consumption of neighbours induce individuals to conserve?”

This latter issue, of the collective social impact on individual decision-making, is a key one, the WDR’s researchers note.

“If you know lots of people who pay taxes, you are more likely to pay taxes. That may be as important or more important as the likelihood of getting caught,” Varun Gauri, a co-director of the new WDR, told IPS.

“That increase in tax receipts would have a huge impact on development prospects in a number of countries [in terms of] law-abidingness and corruption or other areas where you could have large, paradigm-changing impact.”

Self-reflection

Gauri notes that many of the factors that need to be taken into consideration regarding communities receiving development interventions – their biases, their potential illogic – should also be applied to policymakers designing these interventions.

“A lot of the findings that have been conducted to date focus on households and consumers and their choices. But these findings apply to everybody, including to policymakers themselves,” Guari says.

“So to the extent that these findings can have a huge paradigm-shifting impact, it may be as a result of policymakers themselves thinking through their own biases, thinking through the cognitive illusions they’re under before they make policies for an entire country.”

This self-reflexive tone is welcome, the American Institutes for Research’s Bos says. Indeed, he suggests it should have been the report’s primary focus.

“I think this report would have been far more powerful if it had started with analysis of [the World Bank’s] own practices,” he says.

“Often it’s much easier for us rational donors to change how we do our business than it is to go into a poor country and tell them how to do things differently. Starting with ourselves would be a far better way of applying these lessons.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Fracking fluid and other drilling wastes are dumped into an unlined pit located right up against the Petroleum Highway in Kern County, California. Credit: Sarah Craig/Faces of Fracking

By Carey L. Biron
WASHINGTON, Dec 1 2014 (IPS)

Multinational oil and gas companies are engaged in a quiet but broad attempt to prepare the groundwork for a significant global expansion of shale gas development, according to a study released Monday.

Thus far, the hydraulic fracturing (or “fracking”) technologies that have upended the global gas market have been used primarily in North America and, to a lesser extent, Europe. With U.S. gas production in particular having expanded exponentially in recent years, however, countries around the world have started exploration to discern whether they, too, could cash in on this new approach.Argentina has put in place a new law guaranteeing a minimum price for fracked gas. Further, this minimum price is some 250 percent higher than the previous valuation – a sweetheart guard against the bottomed-out prices that are currently impacting on gas production in the United States.

According to an estimate published last year by the U.S. Energy Information Administration, some 90 percent of the world’s shale gas could be found outside of the United States – an incredibly lucrative potential. “It’s likely there will be a revolution,” Maria van der Hoeven, the executive director at the Paris-based International Energy Agency, has said.

Yet according to the new study, from Friends of the Earth Europe, a watchdog group, only Brazil has strengthened its regulatory regime in anticipation of this expansion. Of the nearly dozen countries the new report looks at, most are doing the opposite.

“Under pressure from the fossil fuel industry – which has deep pockets and promises employment and investment – several governments have already started to weaken their environmental legislation, alter their tax regimes and put in place industry-friendly mining licensing and production processes, in order to attract foreign investors and expertise,” the report states. “This is often at the expense of the public interest.”

In terms of production this remains a nascent industry. Nonetheless, neither governments nor companies appear to have undertaken efforts to guard against the complexities that will arise, including around the potential for social, environmental and even political tensions.

“The industry is trying to change the legislation in those places where they want to operate, to try to repeat as much as possible the favourable policies we’ve seen in U.S. energy policy,” Antoine Simon, a shale gas campaigner with Friends of the Earth Europe and lead author on the new report, told IPS.

“The key here is to ensure that the legal frameworks are as friendly for the industry as possible. That’s the first phase of this global strategy, and we’re seeing it in each country we studied.”

No safeguards

Outside of North America and Europe, Argentina has moved forward the quickest on shale gas development, and thus offers a key example on legislative action for which companies may be looking.

For instance, Argentina has put in place a new law guaranteeing a minimum price for fracked gas. Further, this minimum price is some 250 percent higher than the previous valuation – a sweetheart guard against the bottomed-out prices that are currently impacting on gas production in the United States.

Simon says this law has a telling nickname in Argentina – the “Chevron Decree”, a reference to the U.S. oil and gas company. The day after the law was passed, he notes, Argentina’s main state-backed oil and gas producer signed a long-term production deal with Chevron.

Other countries have put in place favourable new tax policies for oil and gas investors. In Morocco, for instance, producers will be exempt from corporate taxes for the first decade of operation, while Russia has created similar policies for oil production over the next 15 years.

Yet the lack of action to simultaneously put in place environmental or social safeguards in most countries runs a variety of risks, Friends of the Earth Europe and others warn. Hydraulic fracturing requires massive amounts of water, for instance – up to 26 million litres per drill site.

The new report finds that a significant proportion of shale gas reserves around the world are located in areas that are already experiencing significant water shortages and even related violence. Likewise, many of these shale basins are beneath major cross-border aquifers.

Even before these issues are addressed by national governments, then, the oil and gas industry could gain influence in setting policy on the notoriously contentious issue of freshwater use.

Alongside concerns about the local impact of shale gas development is a broader lack of clarity today on the extent to which developing countries would be able to benefit from any new gas-related revenues. Thus far, only Brazil has specifically addressed this issue.

“In our research, Brazil was the only exception in terms of passing legislation that ensured they would get some significant revenues,” Simon says. “Really that doesn’t seem to be happening in other countries, where instead we’re seeing a lot of legislation that offers state aid to push investors to come to their countries.”

Beyond a few notable exceptions in Latin America and South Africa, Simon suggests that this issue has not yet seen significant opposition by civil society. Still, advocacy groups do point to a growing trend of global understanding and mobilisation on fracking concerns.

“As more and more studies confirm the risks of air pollution, water contamination, increased earthquake activity and climate change impacts from fracking, the more people oppose this destructive and intensive process,” Wenonah Hauter, the executive director of Food & Water Watch, a U.S. watchdog group, told IPS.

“The movement to ban fracking has resulted in hundreds of local communities taking action to stop fracking, several states and countries instituting moratoriums, and the movement continues to grow.”

In October, Food & Water Watch organized an international day of action to ban hydraulic fracturing. Hauter notes that the event featured “over 300 actions in 34 countries, from Australia to Argentina, even Antarctica, calling for a ban on fracking”.

Food & Water Watch reports that France and Bulgaria have already banned hydraulic fracturing, while local moratoriums have also been passed by hundreds of communities across the Netherlands, Spain and Argentina.

U.S. government promotion

Meanwhile, the drivers behind fracking-related pressures are not simply multinational companies and national governments keen on investment. It was in the United States where hydraulic fracturing was invented and proved its potential, and today the U.S. government is reportedly taking a central role in promoting these techniques worldwide.

In almost all of the countries studied for the new report, researchers found the development of shale gas to be “closely linked” to a U.S. government agency, the U.S. Unconventional Gas Technical Engagement Program (UGTEP). Housed within the U.S. State Department, since 2010 the UGTEP has engaged in a wide variety of technical assistance around gas development.

“Governments often have limited capability to assess their own country’s unconventional gas resource potential or are unclear about how to develop it in a safe and environmentally sustainable manner,” UGTEP explains on its website. “The ultimate goals of UGTEP are to achieve greater energy security by supporting the development of environmentally and commercially sustainable frameworks.”

While U.S. diplomats are specifically tasked with strengthening U.S. business prospects abroad, critics say UGTEP’s activities constitute the broad promotion of hydraulic fracturing under the guise of U.S. diplomacy.

“UGTEP uses official government channels and US taxpayers’ money to promote high-volume horizontal hydraulic fracturing worldwide, opening doors for the main global players in the oil and gas industry,” the Friends of the Earth Europe report states.

“Through UGTEP, the US is also actively engaged in re-shaping existing foreign legal regulations to create the desired legal framework for the development of shale oil and gas in the targeted countries.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Gold from eastern Congo. The war in Congo is fueled by a thriving gold trade today, with armed groups controlling mines and earning an estimated 50 million dollars last year from selling gold and minerals. This gold is from a day's work at Kaniola mine. Credit: ENOUGH Project/cc by 2.0

By Carey L. Biron
WASHINGTON, Nov 25 2014 (IPS)

Major U.S. jewellery companies and retailers have started to take substantive steps to eliminate the presence of “conflict gold” from their supply chains, according to the results of a year-long investigation published Monday.

Rights advocates, backed by the United Nations, have been warning for years that mining revenues are funding warlords and militia groups operating in the Great Lakes region of Africa, particularly in the eastern part of the Democratic Republic of the Congo (DRC). In 2010, such concerns resulted in landmark legislation here in the United States aimed at halting this trade, and those laws have since spurred similar legislative proposals in the European Union and Canada.“Just a few years ago, jewellery companies were pretty resistant to making progress on this, but today there is clearly interest in supporting peace and finding out more about the role they can play in this issue." -- Holly Dranginis of Enough Project

Three of the most problematic of these “conflict minerals” – tin, tantalum and tungsten, collectively known as 3T – are used primarily by the electronics industry. In recent years, that sector has made notable progress in certifying and otherwise regulating its use of these materials.

Yet forward movement has been slower on the fourth conflict mineral from the Great Lakes region – gold.

“Over two-thirds of the eastern Congo’s 3T mines are conflict-free today,” a new report from the Enough Project, a Washington-based watchdog group, states.

“Gold, however, remains a major financial lifeline for armed actors. Ninety-eight percent of artisanally mined gold … is smuggled out of the country annually, and much of that gold benefits armed commanders.”

Last year, the report estimates, some eight to ten tons of gold were smuggled out of eastern DRC. That would have been worth more than 400 million dollars.

Much of this smuggling is thought to take place through Congo’s neighbours, particularly Uganda and Burundi, and onwards to Dubai. From there, most of this gold is able to anonymously enter the global marketplace.

The jewellery industry, meanwhile, is the largest user of global gold supplies, constituting slightly less than half of worldwide demand. “Conflict gold thus taints the industry as whole,” the report warns.

Pledging to stay

According to the Enough Project’s new rankings, however, the industry is starting to respond to these concerns. Researchers looked at both past and pledged actions by 14 of the largest jewellery companies and retailers in the United States – part of an industry worth some five billion dollars a year – and found a spectrum of initiatives already underway.

On the one hand, some companies appear to have undertaken no conflict minerals-related initiatives whatsoever, at least as far as the new report’s metrics were concerned. Three companies scored zero points, while others – including major retailers such as Walmart, Sears and Costco – scored very low.

On the other hand, the researchers found a few key companies that have undertaken particularly notable responses. They say there is reason to believe that these leaders could now influence the rest of the industry.

“We really wanted to focus on the leading jewellery retailers in the U.S. because of their leverage over the industry – we wanted to take lessons from our experience with the electronics industry, that leading companies can move an entire industry,” Holly Dranginis, a policy analyst with the Enough Project and the lead author on the new report, told IPS.

“Just a few years ago, jewellery companies were pretty resistant to making progress on this, but today there is clearly interest in supporting peace and finding out more about the role they can play in this issue. We found two very clear leaders among the 14.”

Those are two of the most recognizable jewellery brands and retailers in the world, Signet Jewelers and Tiffany & Co. Three others highlighted for recognition in the rankings are the commercial retailers J.C. Penney Company, Target Corp. and Cartier.

The Enough Project researchers sent a broad questionnaire to these companies, and Signet and Tiffany received the highest overall rankings. Yet Dranginis notes that what differentiates these companies is merely the fact that they have put in place policies around the sourcing of gold from the Great Lakes region.

Perhaps more importantly, these companies have also started engaging on the ground in countries such as the DRC. Over the past three years, for instance, Signet has pledged to continue sourcing certified gold from the country, rather than simply moving on to another country entirely. The company is also making its sourcing strategies open to others in the industry.

“We see our involvement in industry guidance and standards in the gold sector and the development and implementation of the Signet Responsible Sourcing Protocols as part of a broader initiative of ensuring responsible business practices through the entire jewellery supply chain, for gold and for all other materials,” David A. Bouffard, a vice president for Signet Jewelers, told IPS in a statement.

“It is important to us that our SRSPs are open public protocols which can be used by anyone in our industry, and which Signet’s suppliers can use to their benefit in their relationships with other customers.”

Tiffany, meanwhile, is making a concerted effort to assist local communities, particularly small-scale miners and their families. Both companies reportedly have individual executives that have taken a particular interest in the issue.

“One of the concerns has been that compliance with [U.S. conflict minerals laws] has pushed some companies to think they should leave the region and source elsewhere,” the Enough Project’s Dranginis says.

“Supporting community initiatives in the region is critical, because a lot of communities are affected by major market changes. We also need to ensure that gold miners and their families are supported in a comprehensive way, looking into sustainable projects, alternative livelihoods, financial inclusion and related issues.”

Certification capacity

Action by major brands is, of course, a key component in driving the global response to the impacts of conflict gold. Yet an important collection of multistakeholder and trade mechanisms has also sprung up in recent years, directly facilitating these initiatives.

Central to any attempt at tracking and regulating raw commodities, for instance, is a system of certification. And just as the electronics industry has been able to use metals smelters as an important lynchpin in this process, so too has the gold industry been able to start certifying gold refiners.

According to the new report, in 2012 just six gold refiners had been certified as “conflict free” by one such initiative, the Conflict Free Smelter Program. Two years later, that number has risen to 52 – though “there are still many refiners outside the system,” the study notes.

Advocates are also calling for stepped-up and coordinated action by governments. While the United States, European Union and Canada could all soon have legislation on the use of conflict minerals, some are increasingly pushing for action from the government of the United Arab Emirates aiming to constrict the flow of conflict gold through Dubai.

Likewise, India, Pakistan and China are among the most prominent consumers of gold worldwide, and thus constitute key sources of demand.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

The key U.S. advocate of a proposal to create a multilateral body mandated to investigate allegations of political corruption says the idea is receiving significant interest from civil society, politicians and major business leaders.

Mark L. Wolf, a U.S. federal judge, first proposed the idea of an International Anti-Corruption Court (IACC) in two articles this summer (available here and here). Since that time, Wolf told a recent briefing at the U.S. Congress, the proposal has seen “remarkable progress”.“In the developed world we can make the mistake of seeing corruption as merely stealing money, but in fact political corruption kills more people than war and famine put together – 140,000 children a year, by our estimates.” -- Akaash Maharaj of GOPAC

“There are, of course, challenges to refining the concept of an IACC,” Wolf told a House of Representatives committee last week. “However, since July 2014 significant support has developed for meeting these challenges.”

Wolf reported ongoing meetings with U.S. officials and the World Bank, and reported that the new United Nations high commissioner for human rights, Zeid Ra’ad Hussein, has made the IACC proposal a “personal priority”. Hussein was a key force in the creation of the International Criminal Court, a potential model for the IACC.

This week, Wolf is addressing representatives of major global companies.

“American companies generally want to behave ethically and, in addition, are significantly deterred by the threat of prosecution,” Wolf stated. “They know they would benefit from the more level playing field an IACC would provide.”

Indeed, many say the speed with which the congressional committee moved to hold last week’s briefing is remarkable. It underscores a uniquely broad consensus, both domestically and internationally, around the need to crack down on what is referred to as “grand corruption” – the abuse of political office for personal gain.

Increasingly, this issue is being seen as less one of theft than of basic human rights.

“Today’s briefing seeks to foster an understanding that human rights and anti-corruption efforts are inseparable,” James McGovern, the member of Congress who chaired the committee’s discussions, stated in opening remarks.

“Currently, there is a lack of reference to human rights in international anti-corruption commitments and, conversely, the lack of reference to corruption in international human rights instruments.”

140,000 children a year

Grand corruption is today thought to eat up more than five percent of global gross domestic product. According to estimates cited by Judge Wolf, illicit financial flows out of developing countries are 10 times larger than the foreign assistance those countries receive – losses that have direct human consequences.

“In the developed world we can make the mistake of seeing corruption as merely stealing money, but in fact political corruption kills more people than war and famine put together – 140,000 children a year, by our estimates,” Akaash Maharaj, the executive director of the Global Organization of Parliamentarians Against Corruption (GOPAC), told IPS.

“If a political actor were to kill that many people, there would be very few people who wouldn’t say that we have to deal with this problem. But those who bring about human suffering through political corruption are no less guilty.”

GOPAC, which includes legislators from almost every country, has been mobilising around the need for concerted international action against corruption for the past three years. Maharaj says that his organization’s membership has lost faith in the ability of many countries to deal with political corruption at the national level.

While there are international mechanisms that threaten penalties for egregious human rights abuse, for the most part corruption continues to fall into a nebulous zone of national responsibility. Existing multilateral agreements, including the United Nations Convention Against Corruption, which came into effect in 2003, lack substantive enforcement mechanisms.

Yet while anti-corruption legislation exists in almost every country, advocates note that many of the most corrupt officials are often able to use their wealth and power to subvert these laws. These figures are typically the least likely to face domestic justice, and thus can come to expect impunity.

“There are certain crimes so beyond the pale and beyond state capacity to prosecute that it becomes appropriate for the international community and for international law to become engaged. Certainly the harm grand corruption causes in many developing countries is enormous,” Zorka Milin, a legal adviser with Global Witness, a watchdog group, told IPS.

“An international court would be a good mechanism for trying to translate that momentum into meaningful accountability, which we haven’t really seen so far. It’s important to frame the discussion in terms of ending impunity, and this court would be one piece of that, together with other legal anticorruption tools at the domestic level.”

Under Wolf’s proposal, an IACC would be mandated to investigate and prosecute officials from countries that are unable or unwilling to undertake such actions on their own. He suggests making acceptance of the proposed court’s jurisdiction a pre-condition for membership under the Convention Against Corruption or at the World Trade Organisation, or for obtaining loans from multilateral banks.

Inevitable, unclear action

The global discussion today is increasingly conducive to some sort of concerted global action against political corruption. In part, this trend is driven by strengthened concern around the effects that tax evasion is having on public coffers in both developed and developing countries.

“Unquestionably, there is today more momentum and awareness on the issue of grand corruption, and that’s the major reason these issues are rising on the international agenda,” Milin says.

GOPAC’s Maharaj agrees. “I’m struck by the extraordinary level of consensus across the world,” he says. “This is absolutely inevitable. It’s not a matter of if, but when.”

Exactly what should be done about the issue, however, remains highly contentious. There are multiple potential options, after all, with an international court being just one.

Others include expanding the purview of the International Criminal Court or other regional human rights courts. Likewise, the jurisdiction of national judicial systems could be enlarged to be able to deal with allegations of corruption in other countries.

Another possibility could be to coordinate national legislation – and priority – in developed countries, aimed at seizing the assets of or denying visas to corrupt officials. While this would not result in jail time, it would make it harder to spend ill-gotten wealth while simultaneously emphasising international disapproval.

Importantly, some countries have become increasingly aggressive in this regard in recent years, particularly the United States and Switzerland. Watchdog groups say these nascent initiatives are important and already having impact.

“Over the last eight years there’s been growing official action against kleptocracy in the U.S. and elsewhere,” Arvind Ganesan, the head of the business and human rights programme at Human Rights Watch, told IPS.

“Strengthening those efforts now – meaning fully resourcing and expanding them, and pushing other countries to put in place similar policies – will build momentum towards an International Anti-Corruption Court.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

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

An Ebola treatment centre in Kenema, Sierra Leone, on the day of a visit from Anthony Banbury, Special Representative of the Secretary-General and Head of the UN Mission for Ebola Emergency Response (UNMEER). Credit: UN Photo/Ari Gaitanis

By Carey L. Biron
WASHINGTON, Nov 13 2014 (IPS)

The United States proposed Tuesday that the international community write off 100 million dollars in debt owed by West African countries hit hardest by the current Ebola outbreak. The money would be re-invested in health and other public programming.

U.S. Treasury Secretary Jack Lew will be detailing the proposal later this week to a summit of finance ministers from the Group of 20 (G20) industrialised countries. If the idea gains traction among G20 states, that support should be enough to approve the measure through the International Monetary Fund (IMF), where the United States is the largest voting member."The plan is for that money to be re-invested in social infrastructure, including hospitals and schools … to deal with the short-term problem of Ebola but also the long-term failure of the health systems that allowed for this outbreak.” -- Jubilee USA’s executive director Eric LeCompte

“The International Monetary Fund has already played a critical role as a first responder, providing economic support to countries hardest hit by Ebola,” Lew said in a statement to IPS.

“Today we are asking the IMF to expand that support by providing debt relief for Sierra Leone, Liberia and Guinea. IMF debt relief will promote economic sustainability in the worst hit countries by freeing up resources for both immediate needs and longer-term recovery efforts.”

These three countries together owe the IMF some 370 million dollars, according to the U.S. Treasury, with 55 million dollars due in the coming two years. Yet there are already widespread fears over the devastating financial ramifications of Ebola on Guinea, Liberia and Sierra Leone, in addition to the epidemic’s horrendous social impact.

Last month, the World Health Organisation warned that the virus now threatens “potential state failure” in these countries. The World Bank, meanwhile, estimates that the virus, which has already killed more than 5,000 people and infected more than 14,000, could cost West African countries some 33 billion dollars in gross domestic product.

Of course, much of the multilateral machinery is often too cumbersome to respond to a fast-moving viral outbreak. Yet there is reason to believe that the U.S. plan could have both immediate and long-term impacts.

That’s because the plan would see the IMF tap a unique fund set up in the aftermath of the 2010 Haiti earthquake, which facilitated the cancellation of nearly 270 million dollars of Haitian debt to the IMF. Called the Post-Catastrophe Debt Relief (PCDR) Trust, it is aimed specifically at responding to major natural disasters in the world’s poorest countries.

Originally, the PCDR Trust was capitalised with more than 420 million dollars. Today, a U.S. Treasury spokesperson told IPS, the trust has some 150 million dollars in it – money that would be available almost immediately.

“Our proposal is for the IMF to provide debt relief for these Ebola-affected nations from this trust,” the spokesperson said. “The U.S. would like to see around 100 million dollars put toward this effort, however the precise amount will need to be determined in consultations with the IMF and its membership.”

The IMF, meanwhile, says it is preparing to consider the proposal. In September the Washington-based agency made available 130 million dollars in immediate support to Guinea, Liberia and Sierra Leone.

“We are very glad that some donors have expressed an interest in increasing support for the Ebola-affected countries. We are reaching out to all donors to see how we might be able to take this forward … using all the tools available to us,” an IMF spokesperson told IPS.

“[Debt relief] decisions are made according to the merits of the particular case and this would be approached in the same way. We would expect the Board to be briefed soon on this topic.”

Ebola’s “natural disaster”

For development and anti-poverty advocates, debt obligations on the part of poor countries constitute a key obstacle to a government’s ability to respond to critical social needs, both in the short and long term.

In the West African epicentre of the current Ebola outbreak, many analysts have held chronic low national health spending directly responsible for allowing the epidemic to spiral out of control. And when looking at feeble public sector spending, it is impossible not to take into account often crushing debt burdens.

For instance, Guinea spent a little more than 100 million dollars on public health in 2012 but paid nearly 150 million dollars that same year on internationally held debt, according to World Bank figures provided by Jubilee USA, an anti-debt advocacy network that has spearheaded the push for the United States to make the current proposal.

“As bad as Ebola has been, some of these countries have far greater challenges with deaths from malaria than from Ebola,” Eric LeCompte, Jubilee USA’s executive director, told IPS.

“The amount is incredibly important because it cancels a significant portion of the debt completely. And the plan is for that money to be re-invested in social infrastructure, including hospitals and schools … to deal with the short-term problem of Ebola but also the long-term failure of the health systems that allowed for this outbreak.”

LeCompte was also involved in the creation of the Post-Catastrophe Debt Relief Trust, in the aftermath of the Haitian earthquake. His office has advocated for the fund’s monies to be used since then – for instance, to react to flooding in Pakistan and Typhoon Haiyan in the Philippines.

But he says these and other proposals have been rejected by the IMF’s membership, on the rationale that these countries were developed enough to be able to mobilise financing in other ways. (The IMF says PCDR funds are for response to “the most catastrophic of natural disasters” in “low-income countries”, when a third of a country’s population has been affected and a quarter of its production capacity destroyed.)

Not only are Guinea, Liberia and Sierra Leone among the poorest countries in the world, but the Ebola outbreak there has a potentially direct impact on the rest of the globe.

“This is a very clear opportunity to point to the 150 million dollars left in that fund and to note that Ebola is every bit the same as the Haitian earthquake in terms of being a regional calamity,” LeCompte says.

“The difference is that this is also a long-term investment in the very problems that allow Ebola to spread. So we’d be not only addressing the current issue, but also the next disease outbreak in that region.”

It is unclear whether there is a mechanism in place to top up the PCDR Trust in the future. The IMF states that “Replenishment of the Trust will rely on donor contributions, as necessary.”

But for his part, LeCompte says the fund has the potential to fill a significant gap: offering a pot of money, immediately available, that could be quickly mobilised to deal with true crises afflicting the world’s poorest countries, from hurricanes to major financial defaults.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Rally outside the TPP talks in Sydney, Oct. 25, 2014. Credit: SumOfUs/cc by 2.0

By Carey L. Biron
WASHINGTON, Nov 11 2014 (IPS)

For the third year in a row, government negotiators for 12 Pacific Rim countries have missed an internal deadline to reach agreement on a controversial U.S.-led trade deal.

And though negotiators for the accord, known as the Trans Pacific Partnership (TPP), say the process is nearing completion, critics of the deal are expressing optimism that both public opinion and political timing are increasingly against the deal.“TPP proponents know they’re under the clock. The resistance against the TPP is as strong as it’s ever been, and is only growing stronger.” -- Arthur Stamoulis of the Citizens Trade Campaign

“The reason the Obama administration keeps missing deadline after deadline, year after year, is that it’s pushing an extremely unpopular agenda that benefits a handful of big corporations at the expense of the economy, environment and public health in each TPP country and beyond,” Arthur Stamoulis, executive director of the Citizens Trade Campaign, an advocacy group that opposes the TPP, told IPS.

“People and parliaments across the Pacific Rim are starting to realise that the TPP would be bad news for their countries. That includes here in the U.S.”

TPP negotiators confirmed the news on Monday at a regional summit in Beijing. President Barack Obama’s administration, which has been spearheading the TPP talks, had set the meeting of the Asia-Pacific Economic Cooperation (APEC) grouping as a key target for agreement.

President Obama has made the TPP a central part of his attempt to reorient the United States towards Asia – and to economically circumscribe China, which isn’t party to the talks. On Monday, the president himself was in Beijing, where he acknowledged that the TPP process now needed additional political pressure.

“During the past few weeks, our teams have made good progress in resolving several outstanding issues regarding a potential agreement. Today is an opportunity at the political level for us to break some remaining logjams,” the president told trade ministers in Beijing.

“To ensure that TPP is a success, we also have to make sure that all of our people back home understand the benefits for them – that it means more trade, more good jobs, and higher incomes for people throughout the region, including the United States.”

The president said the TPP talks have the possibility of resulting in a “historic achievement”. A statement released by the 12 countries party to the talks suggested that “the end” of the negotiations is “coming into focus”.

Yet disagreements remain, with media reports pointing to agricultural protectionism as proving to be particularly thorny. Others say that substantive frustration remains over a raft of disparate issues, many far from traditional trade concerns – including environmental impact, labour safeguards, medicinal pricing, patent rules and investors’ ability to circumvent national law, among other concerns.

In many ways, it is the broad scope of issues on which the TPP touches that is responsible for strengthening public concern. Now, with President Obama down to his final two years in office, critics are increasingly confident in their ability to stave off agreement.

With the U.S. 2016 president elections likely to heat up as early as the middle of next year, passage of any major trade agreement by U.S. lawmakers would be improbable until 2017 at the earliest.

“TPP proponents know they’re under the clock,” the Citizen Trade Campaign’s Stamoulis says. “The resistance against the TPP is as strong as it’s ever been, and is only growing stronger.”

Corporatist concerns

Last week’s national election here in the U.S. did change the discussion around one issue that would be key for any eventual TPP agreement: whether President Obama is allowed to negotiate unilaterally, or whether he would need Congress’s point-by-point approval of a proposed accord.

Because trade agreements typically touch on so many domestically sensitive issues, U.S. presidents in the past have asked for approval to negotiate without input from lawmakers. Such “fast track” authorities then allow Congress only a single up-or-down vote at the end of the process.

Yet due to concern among U.S. constituents over the potential impact of the TPP on the domestic economy, both houses of the U.S. Congress has been reluctant to approve President Obama’s requests for these authorities. Still, last week’s election some have suggested that this could change.

The issue could now come down to a debate that is taking place within the Republican Party, which increased its majority in the House of Representatives and in January will take over control of the Senate. Yet while the House has consistently opposed passage of fast track authorities for President Obama, the new Republican Senate leadership has suggested that such legislation could now be a key priority early next year.

“Most of [President Obama’s] party is unenthusiastic about international trade. We think it’s good for America,” Mitch McConnell, the top Republican in the Senate and the figure who will set the body’s agenda this coming year, said at a press conference following last week’s election.

“And the president and I discussed that … and I think he’s interested in moving forward. I said, ‘Send us trade agreements. We’re anxious to take a look at them.’”

The new potential movement on fast track authorities has sparked a furious debate among conservatives, particularly between those who have traditionally supported big business and those increasingly concerned about globalisation’s impact on U.S. workers. This division has strengthened since the 2008 economic downturn.

“It’s only in the past few years that we’ve seen a small cabal of internationalist, Big Business-allied Republicans emerge, and it is this corporatist wing that has pushed for free trade,” Curtis Ellis, a spokesperson with the American Jobs Alliance and executive director of ObamaTrade.com, a conservative watchdog site, told IPS.

“If we’re going to move all of our factories overseas, the American people are going to get stuck with the short end of stick. And really, even supporters of the TPP admit that it’s not about trade but rather about investment – about securing overarching global governance rules on investment.”

Indeed, of the TPP’s 29 proposed chapters, just five deal directly with trade, according to Public Citizen, a consumer interest group here.

“[T]he non-trade provisions would promote lower wages, higher medicine prices, more unsafe imported food, and new rights for foreign investors to demand payments from national treasuries over domestic laws they believe undermine the new TPP privileges they would gain,” Lori Wallach, the head of the group’s Global Trade Watch programme, said Monday.

“Despite the intense secrecy of the negotiations … many TPP nations have woken up to the fact that the deal now on offer would be damaging to most people, even if the large corporations pushing the deal might improve their profit margins.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Children playing in mining tailings in Morococha, Peru. Credit: Milagros Salazar/IPS

By Carey L. Biron
WASHINGTON, Nov 6 2014 (IPS)

The world’s largest corporations continue to publicise scant information about their global operations, according to new analysis that warns that extractives companies in particular are unprepared for pending disclosure requirements.

The findings come from the global watchdog Transparency International, which looked at 124 of the world’s largest companies. Using publicly available information, the researchers ranked each corporation based on three concerns: anti-corruption measures, transparency around global operations and subsidiaries, and disclosure of country-by-country and project-level finances.“Industry resistance to this kind of regulation has been pretty strong, so it’s not surprising that companies aren’t voluntarily disclosing this information and instead waiting until they’re forced to do so.” -- Alexandra Gillies

While the level of anti-corruption activities is relatively high and growing, the current state of the latter two metrics is far weaker. Indeed, the average score for country-by-country reporting, seen as a transparency lynchpin, is a dismal six percent – and 50 companies have scored zero.

In introducing the study on Wednesday, Transparency International’s chair, Jose Ugaz, noted that the power of multinational companies in today’s global economy rivals even the biggest countries.

“With greater economic power comes greater responsibility,” he said. “Bad corporate behaviour creates the corruption that causes poverty and instability.”

In general, British companies fare best in the new index, Chinese and Asian companies more broadly fare worst, and the U.S. technology sector receives special criticism for its lack of transparency. Transparency International has been reporting on corporate governance since 2008, with the last such study being released in 2012.

The weak results for country-by-country reporting, in particular, will worry anti-poverty advocates and proponents of public sector spending. Such disclosure would, for instance, allow governments to efficiently compare crossborder information with the aim of cutting down on tax evasion as well as outright theft of revenues.

Developing countries may have lost an estimated six trillion dollars in the decade before 2011 due to tax evasion and other shady financial dealings, according to the Washington watchdog group Global Financial Integrity.

“Domestic resource mobilisation is seen as key to unlock economic development,” Koen Roovers, the E.U. advisor for the Financial Transparency Coalition, a global network that funded the new Transparency International report, told IPS.

“Publicly available [country-by-country reporting] information would enable citizens of developing nations to determine whether the taxes paid by the transnational companies that trade in their countries is in line with their activities. The apparent absence of this information gives reason for suspicion.”

Industry resistance

With the aim of ensuring that lucrative natural resources-related revenues are safeguarded in developing countries, the global extractives industry has been a special focus for disclosure requirements.

The United States, European Union and Canada in recent years have all passed project-by-project disclosure requirements, mandating reporting on all payments made by extractives companies to foreign governments.

And while the U.S. legislation is currently held up in court due to a lawsuit brought by the oil industry, the E.U.’s requirements are set to go into effect by the middle of next year. Canada’s new rules could be implemented even sooner.

Yet Transparency International warns that extractives companies are “not ready” to comply with these new rules.

“Even though country-by-country reporting was first introduced in the extractive sector, the 19 oil and gas companies in the study only scored an average of 10 per cent,” the report states. “Six companies in this industry scored zero.”

Not all of these companies did poorly on country-by-country reporting. For instance, the Norwegian oil company Statoil scored highest of all of the 124 companies on this metric, with a score of 66 percent.

Other strong performers included the Indian companies Oil & Natural Gas Corporation and Reliance, as well as the Australian-headquartered BHP Billiton, by certain calculations the world’s largest mining company.

Yet overall the sector still appears to be biding its time until the new requirements in the U.S., E.U. and Canada go into effect. For supporters of stricter disclosure, the findings underscore just how transformative those new legal regimes will be.

“Industry resistance to this kind of regulation has been pretty strong, so it’s not surprising that companies aren’t voluntarily disclosing this information and instead waiting until they’re forced to do so,” Alexandra Gillies, the head of governance at the Natural Resources Governance Institute (NRGI), a think tank, told IPS.

“While there are a few smaller companies that have taken this step, the big players certainly haven’t. Nonetheless, it will be interesting to see how the same data looks in another two years.”

Indeed, the U.S. and E.U. disclosure requirements alone would cover an estimated 65 percent of the global extractives sector in terms of value, according to Publish What You Pay, a global advocacy group. And the new Canadian rules, formally tabled late last month with the aim of implementation by April, would likewise affect the world’s largest national mining industry.

Further, at a summit next week, the Group of 20 (G20) industrialised countries are expected to approve a new country-by-country reporting standard that would cover all multinational companies. The Financial Transparency Coalition’s Roovers says the new findings from Transparency International will “up the ante” for the G20 discussions.

Still, he notes that, as currently envisioned, the G20 reports would likely not be made public due to concerns over commercial “sensitivities”.

On to contracts

For many advocates, non-public disclosure would defeat an important purpose of stricter transparency requirements: empowering citizens and civil society to engage in local-level oversight.

“The real innovation around project-level data is that citizens or journalists or parliamentarians would be able to understand the deals that their government has entered into. Right now all we have are highly aggregated figures,” NRGI’s Gillies says.

“If someone is dealing with, say, a huge mine in their community, that data can help them to understand how much money the government is collecting for that project – and whether the disruption they’re facing is worthwhile.”

Nonetheless, with country-by-country reporting requirements now on the horizon, Gillies and others are already turning their attention to a corollary data set: contract-level disclosure. Indeed, certain countries – including Liberia, Guinea, the Democratic Republic of Congo and others – as well as some companies are already making all information on contracts related to natural resource extraction publicly available.

“If you have good revenue or payment data, it’s still difficult to understand what those figures mean unless you know what agreements have been signed,” Gillies says.

“But contract disclosure is already becoming more widely accepted, with a few countries and companies taking the lead. It hasn’t yet become standard practice and what is being done remains piecemeal, but it’s enough to show that this activity isn’t commercially dangerous.”

Within a few years, advocates hope to see the disclosure of both payments and agreements signed with foreign governments become standard procedure.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

While a major global campaign to cut down on tax evasion is picking up momentum, anti-poverty advocates say the initiative overlooks the world’s poorest countries.

Last week, 51 countries from four continents agreed to systematically exchange tax information by 2017, with the aim of allowing authorities to quickly register any disparities. Several dozen additional countries – 89 in total – said they would follow suit by the following year, according to the Organisation for Economic Cooperation and Development (OECD), a grouping of wealthy countries that is spearheading the project."Do we really think that there are many Brits or Americans with money in, say, Nigeria? Probably not. But is there likely a lot of Nigerians with money in the U.S. or U.K.? Yes.” -- Heather Lowe, senior counsel with Global Financial Integrity

Global tax evasion has risen to the top of the global agenda in the aftermath of the 2007-08 financial crisis and the resulting financial constrictions felt by governments around the world. Though last week’s pledges will still need to be underpinned by separate bilateral agreements, the new accord is being lauded as a major step forward on the issue.

“This great success in the fight against international tax evasion would have been unthinkable only a few years ago,” Wolfgang Schauble, Germany’s finance minister, wrote Monday for a newspaper here. “We need to make sure that creative tax planning in the form of profit-shifting and artificial profit reduction is no longer a lucrative business model.”

The new pledges were made at the annual meeting of an OECD-organised grouping known as the Global Forum on Transparency and Exchange of Information for Tax Purposes. At the meeting, in Berlin, the forum’s 123 members also formally endorsed a new OECD blueprint, known as the Common Reporting Standard, detailing what information will be collected, by whom, and how it will be exchanged.

Yet the list of those asked to participate in the new pledging includes almost solely developed countries or known tax havens, which rich governments have been particularly keen to address. This is cause for concern for some, given that the impact of illegal financial dealings is felt particularly by weaker economies.

“The new OECD standard on automatic information exchange is a big first step towards tackling illicit financial flows,” Andres Knobel, an analyst with the Tax Justice Network, a British advocacy group, said in a statement.

“However, serious obstacles to the inclusion of developing countries and a number of unresolved loopholes will prevent its effectiveness, allowing rich individuals with plenty of options to avoid reporting.”

Select invitations

While the Global Forum on Transparency includes 123 members, just 95 of these were asked to take part in the new automatic exchanges. And just one of those, the Pacific island nation of Vanuatu – widely known as a tax haven – is considered by the United Nations to be a least developed country.

OECD officials say that many developing countries weren’t invited to take part in this initial round of pledging due to concerns over institutional capacity.

“The developing countries which do not have financial centres have indicated their difficulties on account of low capacity to implement [the automatic exchange of tax information] on such an ambitious timeline,” Monica Bhatia, the head of the Global Forum secretariat, told IPS.

“These countries were nevertheless encouraged to participate with a more flexible timeline and support was offered to facilitate their participation … by way of pilot projects. Already six developing countries have requested pilot projects and the Global Forum is committed to helping other developing countries who come forward as well.”

Yet others suggest that, capacity notwithstanding, all countries should be able to receive tax information about whether their own citizens have undeclared overseas bank accounts.

“Under the current agreement, tax-haven countries that don’t have an income tax for their own people don’t have to reciprocate this information,” Heather Lowe, senior counsel with Global Financial Integrity (GFI), a Washington-based watchdog group, told IPS.

“That makes some logical sense, but the organisers won’t even consider a similar phase-in period for the least developed countries. Do we really think that there are many Brits or Americans with money in, say, Nigeria? Probably not. But is there likely a lot of Nigerians with money in the U.S. or U.K.? Yes.”

GFI has published pioneering data estimating that developing countries could be losing a trillion dollars a year from a variety of shady financial dealings. While all such activities contribute to crippling public-sector coffers, the new plan covers only tax evasion.

“While a portion of illicit financial flows is driven by tax evasion, much of it is also propelled by other crimes such as drug trafficking, sex slavery, corruption and fraud,” Lowe says. “The current framework risks either missing these other major forms of crime, or keeping that information locked up by tax authorities and away from government investigators and prosecutors.”

Starting with Africa

The Global Forum says it wants to bring as many developing countries as possible into the new exchange system, and maintains that multiple initiatives are currently underway to do so. Last week, the grouping announced the most significant of these, a project aimed at strengthening outreach and capacity on the issue in Africa.

The African Initiative, overseen by the Global Forum, the World Bank Group and others, will initially focus on 17 countries, around a third of the continent. Yet an OECD factsheet says this number could be “significantly increased” through the three-year programme.

As yet, there is no parallel initiative in Asia or Latin America, though the Global Forum says such projects could still be created.

“The impetus for the Africa Initiative came from our African member countries … in the wake of increased focus on the problem of illicit financial flows from African countries of which tax evasion forms a significant component,” Kathryn Dovey, a tax policy analyst with the Global Forum, told IPS in an e-mail.

“The Global Forum is committed to working with all developing countries and would be happy to seed and support similar initiatives in other regions. If countries and organisations from the region and relevant international organisations come forward to collaborate, the Africa Initiative could be replicated in other key geographies over time.”

Still, GFI’s Lowe says that capacity-building could be a secondary goal after bringing in poorer countries on a non-reciprocal basis.

“Africa is a strong place to start, because investment in Africa has been growing significantly over the past few years and there are many governments in the continent that are really starting to engage on this issue,” she says.

“But I don’t see why we can’t start with non-reciprocal information for least-developed countries and then work on these capacity-building programmes to allow for reciprocation to happen later. Let’s start with the practical.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

The Canadian government is failing either to investigate or to hold the country’s massive extractives sector accountable for rights abuses committed in Latin American countries, according to petitioners who testified here Tuesday before an international tribunal.

The Inter-American Commission on Human Rights (IACHR) also heard concerns that the Canadian government is not making the country’s legal system available to victims of these abuses.“Far too often, extractive companies have double-standards in how they behave at home versus abroad.” -- Alex Blair of Oxfam America

“Canada has been committed to a voluntary framework of corporate social responsibility, but this does not provide any remedy for people who have been harmed by Canadian mining operations,” Jen Moore, the coordinator of the Latin America programme at MiningWatch Canada, a watchdog group, told IPS.

“We’re looking for access to the courts but also for the Canadian state to take preventive measures to avoid these problems in the first place – for instance, an independent office that would have the power to investigate allegations of abuse in other countries.”

Moore and others who testified before the commission formally submitted a report detailing the concerns of almost 30 NGOs. Civil society groups have been pushing the Canadian government to ensure greater accountability for this activity for years, Moore says, and that work has been buttressed by similar recommendations from both a parliamentary commission, in 2005, and the United Nations.

“Nothing new has taken place over the past decade … The Canadian government has refused to implement the recommendations,” Moore says.

“The state’s response to date has been to firmly reinforce this voluntary framework that doesn’t work – and that’s what we heard from them again during this hearing. There was no substantial response to the fact that there are all sorts of cases falling through the cracks.”

Canada, which has one of the largest mining sectors in the world, is estimated to have some 1,500 projects in Latin America – more than 40 percent of the mining companies operating in the region. According to the new report, and these overseas operations receive “a high degree” of active support from the Canadian government.

“We’re aware of a great deal of conflict,” Shin Imai, a lawyer with the Justice and Corporate Accountability Project, a Canadian civil society initiative, said Tuesday. “Our preliminary count shows that at least 50 people have been killed and some 300 wounded in connection with mining conflicts involving Canadian companies in recent years, for which there has been little to no accountability.”

These allegations include deaths, injuries, rapes and other abuses attributed to security personnel working for Canadian mining companies. They also include policy-related problems related to long-term environmental damage, illegal community displacement and subverting democratic processes.

Home state accountability

The Washington-based IACHR, a part of the 35-member Organisation of American States (OAS), is one of the world’s oldest multilateral rights bodies, and has looked at concerns around Canadian mining in Latin America before.

Yet this week’s hearing marked the first time the commission has waded into the highly contentious issue of “home state” accountability – that is, whether companies can be prosecuted at home for their actions abroad.

“This hearing was cutting-edge. Although the IACHR has been one of the most important allies of human rights violations’ victims in Latin America, it’s a little bit prudent when it faces new topics or new legal challenges,” Katya Salazar, executive director of the Due Process of Law Foundation, a Washington-based legal advocacy group, told IPS.

“And talking about the responsibility for the home country of corporations working in Latin America is a very new challenge. So we’re very happy to see how the commission’s understanding and concern about these topics have evolved.”
Home state accountability has become progressively more vexed as industries and supply chains have quickly globalised. Today, companies based in rich countries, with relatively stronger legal systems, are increasingly operating in developing countries, often under weaker regulatory regimes.

The extractives sector has been a key example of this, and over the past two decades it has experienced one of the highest levels of conflict with local communities of any industry. For advocates, part of the problem is a current vagueness around the issue of the “extraterritorial” reach of domestic law.

“Far too often, extractive companies have double-standards in how they behave at home versus abroad,” Alex Blair, a press officer with the extractives programme at Oxfam America, a humanitarian and advocacy group, told IPS. “They think they can take advantage of weaknesses in local laws, oversight and institutions to operate however they want in developing countries.”

Blair notes a growing trend of local and indigenous communities going abroad to hold foreign companies accountable. Yet these efforts remain extraordinarily complex and costly, even as legal avenues in many Western countries continue to be constricted.

Transcending the legalistic

At this week’s hearing, the Canadian government maintained that it was on firm legal ground, stating that it has “one of the world’s strongest legal and regulatory frameworks towards its extractives industries”.

In 2009, Canada formulated a voluntary corporate responsibility strategy for the country’s international extractives sector. The country also has two non-judicial mechanisms that can hear grievances arising from overseas extractives projects, though neither of these can investigate allegations, issue rulings or impose punitive measures.

These actions notwithstanding, the Canadian response to the petitioners concerns was to argue that local grievances should be heard in local court and that, in most cases, Canada is not legally obligated to pursue accountability for companies’ activities overseas.

“With respect to these corporations’ activities outside Canada, the fact of their incorporation within Canada is clearly not a sufficient connection to Canada to engage Canada’s obligations under the American Declaration,” Dana Cryderman, Canada’s alternate permanent representative to the OAS, told the commission, referring to the American Declaration of the Rights and Duties of Man, the document that underpins the IACHR’s work.

Cryderman continued: “[H]ost countries in Latin America offer domestic legal and regulatory avenues through which the claims being referenced by the requesters can and should be addressed.”

Yet this rationale clearly frustrated some of the IACHR’s commissioners, including the body’s current president, Rose-Marie Antoine.

“Despite the assurances of Canada there’s good policy, we at the commission continue to see a number of very, very serious human rights violations occurring in the region as a result of certain countries, and Canada being one of the main ones … so we’re seeing the deficiencies of those policies,” Antoine said following the Canadian delegation’s presentation.

“On the one hand, Canada says, ‘Yes, we are responsible and wish to promote human rights.’ But on the other hand, it’s a hands-off approach … We have to move beyond the legalistic if we’re really concerned about human rights.”

Antoine noted the commission was currently working on a report on the impact of natural resources extraction on indigenous communities. She announced, for the first time, that the report would include a chapter on what she referred to as the “very ticklish issue of extraterritoriality”.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Some 60 major U.S. food retailers have already pledged not to sell GE salmon. Credit: Kevin Galens/cc by 2.0

By Carey L. Biron
WASHINGTON, Oct 29 2014 (IPS)

Officials in Panama have fined the local facility of a U.S. biotechnology company for a series of permitting and regulatory failures around a pioneering attempt to create genetically modified salmon.

The experiments are being carried out by researchers for AquaBounty Technologies, which currently has an application with the U.S. government to sell genetically modified (GM) salmon filets in this country. If regulators approve that application, AquaBounty’s salmon would be the first genetically modified meat sold for human consumption anywhere in the world."There are about 35 other genetically modified species in the development pipelines in other companies." -- Dana Perls of Friends of the Earth

Further, companies in the United States and around the globe are said to be actively watching U.S. regulators’ response to AquaBounty’s application as a critical indication of whether to proceed with other GM meat projects.

“AquaBounty is really out front on this – the current case will set an important precedent,” Dana Perls, a food and technology campaigner at Friends of the Earth, a watchdog group, told IPS.

“From what we know, there are about 35 other genetically modified species in the development pipelines in other companies. So depending on what happens in this case, we’ll likely either see a flow of other permits or this will demonstrate that there isn’t room on the market for GM meat or seafood.”

AquaBounty’s application with the U.S. government would involve getting filets of the new GM salmon from the company’s breeding facility in Panama and into the U.S. market. Advocates are now pointing to the Panamanian authorities’ findings of regulations violations as an indication that the U.S. regulatory process is proceeding too quickly in considering the salmon application.

“The impacts GM foods will have on health and the environment have not been sufficiently assessed to approve human consumption of this salmon,” Luisa Arauz Arredondo, an attorney with the Panama Centre for Environmental Advocacy, which filed the administrative complaint against AquaBounty, told IPS.

She notes that while AquaBounty’s facilities in Panama have permission to run experiments on the salmon, the country has not approved anything further.

“The salmon would not be sold to Panamanian consumers,” she says, “since the human consumption of GM salmon has not been approved by Panama or the U.S.”

Repeat violations

The Panamanian regulatory decision, which was made public on Tuesday, actually stems from a 2012 investigation of AquaBounty’s facilities and was decided in July of this year. It found that the company had failed to secure necessary permits, particularly around its use of water and pollution of the local environment – potentially important, advocates say, given the possibility of contamination of natural systems.

The authorities noted their view that the company had “repeatedly violated” these regulations, and stated that these problems persisted into 2013. They deemed the transgressions significant enough to levy almost the maximum fine allowable against the company.

AquaBounty Technologies suggests that the concerns outlined by Panama’s government were largely administrative in nature and notes that any problems have all been dealt with already.

“It is important to emphasize that none of the issues in the Resolution questioned the containment, health of the fish, or the environmental safety of the facility,” the company said in a statement sent to IPS.

“When AquaBounty was informed of issues at our Panama facility, we immediately contacted ANAM, the Panamanian agency for the environment. We initiated a program to remedy the deficiencies and the issues were formally resolved in August of 2014.”

The company notes that its Panama facility “continues to operate with no sanctions or restrictions.”

Whether the actions on the part of Panama’s government will impact on the ongoing consideration of AquaBounty’s application by the U.S. Food and Drug Administration (FDA) remains to be seen.

A spokesperson for the FDA likewise pointed out that AquaBounty’s violations were based on a 2012 inspection, but also said the agency would “consider all relevant information as part of the decision-making process.”

The spokesperson noted that the agency is in the process of completing its review of the company’s application, but declined to provide a timeline on what that decision will be made.

Shoehorning regulation

For environmentalists, public interest groups and anti-GMO advocates, the Panama findings underscore a potential weakness in the FDA’s regulatory process.

“This decision is also even further proof that FDA is dangerously out of touch with the facts on the ground, advancing AquaBounty’s application based on its promises, not reality,” George Kimbrell, a senior attorney with the Center for Food Safety, a Washington-based advocacy group, said Tuesday.

Friends of the Earth’s Perls says that the FDA’s current regulatory review of the GM salmon application is based solely on the single AquaBounty facility in Panama.

“The FDA is going forward with its review based on the premise that this facility will be in compliance with regulations, yet now we’re seeing it’s not,” she says. “It is increasingly clear that there is inadequate regulation: the FDA is trying to shoehorn this new genetically engineered animal into a completely ill-fitting regulatory process.”

Much of the concern here revolves around the potential for genetically modified hybrids to escape into the wild, potentially outcompeting wild populations or introducing new diseases. Yet the issue also runs up against the scepticism that continues to colour consumer response to genetically modified foods – and the sense that regulators are moving too quickly to approve these products.

When the FDA in 2012 asked the public to weigh in on the AquaBounty salmon application, it received some 1.8 million comments expressing overwhelming opposition. Members of the U.S. Congress have likewise expressed their concern, and legislation has been proposed that would require the labelling of genetically modified fish.

As yet, there is no legal requirement in the United States to label any genetically modified food or ingredient, though the state of Vermont could soon impose such a mandate. According to a media poll conducted last year, some 93 percent of people in the U.S. support the labelling of genetically modified foods, and three-quarters said they would not eat GM fish.

Yet perhaps the most significant indication of public sentiment on this issue has come from the retailers that have pre-emptively stated that they would not sell genetically modified fish and seafood – regardless of whether the FDA approves its sale. According to data compiled by Friends of the Earth, some 60 major U.S. food retailers have already pledged to do so, including several of the country’s largest grocery chains.

“Should GE salmon come to market, we are not considering nor do we have any plans to carry GE salmon,” Safeway, the second-largest grocer in the United States, said in a policy statement released in February. “Safeway’s [policy] calls for all of our fresh and frozen seafood to be responsibly sourced and traceable or be in a time-bound improvement process by the end of 2015.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

The United Nations’ key mechanism for funding climate change-related mitigation and adaptation in developing countries is now ready to receive funds, following a series of agreements between rich and poor economies.

The agreements covered administrative but potentially far-reaching policies that will govern the mechanism, known as the Green Climate Fund (GCF). This forward momentum comes just weeks ahead of a major “pledging session” in Berlin that is meant to finally get the GCF off the ground.“One thing that was different in this meeting was the willingness of developing countries to take a stand for certain principles.” -- Karen Orenstein of Friends of the Earth

“The fund now has the capacity to absorb and programme resources that will be made available to it to achieve a significant climate response on the ground,” Hela Cheikhrouhou, the GCF’s executive director, said Saturday following a series of board meetings in Barbados.

The GCF constitutes the international community’s central attempt to help developing countries prepare for and mitigate climate change. The undertaking thus includes an implicit acknowledgment by rich countries that the developing world, although the least responsible for climate change, will be the most significantly impacted.

At the Copenhagen climate summit in 2009, donors agreed to mobilise 100 billion dollars a year by 2020, in an undefined mix of public and private funding, to help developing countries. The GCF is to be a cornerstone of this mobilisation, using the money to fund an even split between mitigation and adaptation projects.

The GCF opened a secretariat last year, in South Korea, but pledges have since come in slowly. Currently, the aim is to get together 15 billion dollars as starter capital, much of which will have to be achieved at the November pledging session.

The fund’s capitalisation did get a fillip last month, when France and Germany pledged a billion dollars each and lesser amounts were promised by Norway, South Korea and Mexico. On Wednesday, Sweden pledged another half-billion dollars, aimed at setting “an example to … other donors.”

Still, that brings the total funding for the GCF to less than three billion dollars, under a fifth of the goal for this year alone.

“The good news is that this meeting finished laying a strong foundation for the fund,” Alex Doukas, a sustainable finance associate with the World Resources Institute, a think tank here, told IPS. “It’s now nearly ready to go – but it can’t get far without ambitious pledges in November.”

Significant attention is now shifting to the United States and European Union, which have yet to announce pledges. Anti-poverty campaigners have estimated that fair pledges would be around 4.8 billion dollars for the United States and six billion dollars for the European Union.

Country ownership

The GCF now has the institutional capacity to receive the funding around which its operations will revolve, but important decisions remain regarding how the fund will disburse that money.

“There’s now more clarity on how the fund will invest, but little guidance on exactly what it will invest in,” Doukas, who attended last week’s board meeting in Barbados, says. “The board has serious homework between now and its next meeting in February to ensure that it has rules in place to prioritise high-impact climate solutions that also deliver development benefits.”

Still, some important initial headway was made in Barbados around how these projects will be defined. Indeed, development advocates express cautious optimism the new agreements will put greater control over these decisions in the hands of national governments.

For instance, projects green-lighted by the GCF will now be required to have a “no objection” confirmation from the government of the country in which the project will be based.

“If you do not have the no-objection [requirement], the funding intermediaries will be able to impose their own conditionalities, even their own programmes, on a country,” Bernarditas Muller, the GCF representative from the Philippines, said during negotiations, according to a civil society summary.

Observers say this agreement came about because developing countries banded together and pushed against demands from rich governments. (The GCF board includes 24 members, half from poor and half from rich countries.)

“One thing that was different in this meeting was the willingness of developing countries to take a stand for certain principles,” Karen Orenstein, an international policy advisor with Friends of the Earth who attended the Barbados discussions, told IPS.

“The no-objection procedure in particular is something we’ve been fighting for, for a long time. If an active no-objection is not provided within 30 days, a project is suspended – that is quite important.”

Still, Orenstein, too, worries that significant decisions have against been pushed off to future meetings of the GCF board.

“The fund still leans too heavily towards multilateral development banks and the private sector,” she says.

“It’s not that the GCF shouldn’t be appealing to the private sector, but we want to sure that the priorities are being driven by developing countries. Even though we have these new agreements, there’s still not nearly enough emphasis on having priorities be set at the country level and below.”

New development discourse

At the same time, under this weekend’s agreements developing countries will now be able to access funding directly from the GCF, rather than having to go through an intermediary. In addition, monies pledges to the fund will not be able to be “earmarked” for particular uses by the donor government.

“Traditionally, a lot of funds for climate change have been delivered through multilateral organisations. They haven’t necessarily done a bad job, but in many cases there’s a trade-off between a country’s priorities versus that of the organisation’s,” Annaka Carvalho, a senior programme officer with Oxfam America, a humanitarian and advocacy group, told IPS.

“Making sure that countries are in the driver’s seat in directing where these resources are going is really important. Ultimately, only national governments are accountable to their citizens for delivering on adaptation and investing in low-emissions development.”

Carvalho, who was also at the Barbados negotiations, says that the opportunity once the GCF gets off the ground isn’t only about reacting to climate change. She says the fund can also help to bring about a new development paradigm.

“We’ve been hoping the fund will act as a catalyst for shifting the development discourse away from the forces that have caused climate change and instead towards clean energy and resilient livelihoods,” she says.

“A core part of the fund is supposed to realise sustainable development, but there’s always this line between climate and development. In fact, disconnecting these two issues is impossible.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Of the tens of thousands of chemicals thought to be in regular use in the United States today, the government’s main labour regulator oversees fewer than 500. Credit: Bigstock

By Carey L. Biron
WASHINGTON, Oct 22 2014 (IPS)

The U.S. government will soon begin receiving public suggestions on how federal regulators should update their oversight of toxic chemicals in the workplace.

The new information-gathering process, which began last week and will continue for the next six months, could result in the first major overhaul of related regulations in more than four decades. Of the tens of thousands of chemicals thought to be in regular use in the United States today, the government’s main labour regulator oversees fewer than 500."Many workers are currently being exposed to levels of chemicals that are legal but not safe … The process through which OSHA issues new exposure limits or updates old ones is broken.” -- OSHA chief David Michaels

“New chemicals are being introduced into worksites every year, and we are struggling to keep pace with the potential hazards,” David Michaels, the top official at the Occupational Safety and Health Administration (OSHA), an office within the Labour Department, told journalists while unveiling the new request for information.

“As a result, 40 years after the creation of OSHA, thousands of American workers are still becoming ill and dying from exposure to hazardous chemicals.”

The agency is now in the early stages of what could be a landmark attempt to expand this oversight. While the current move applies solely to workers, if successful it could mark a new phase for U.S. chemicals regulation in general – long criticised for having essentially ceded control to the chemicals industry.

The key laws on chemical safety in the United States date back to the 1970s, and are almost universally seen as so weak as to be nearly worthless. Yet while momentum among lawmakers to update these laws has picked up recently, the replacement proposals have been fiercely derided by public health and environmental groups.

Now, the chemicals industry suggests that it supports OSHA’s plan to revisit its regulatory regime, though sector has ardently fought stricter regulation in the past. Indeed, one its main lobby groups intimates that current efforts are already successful.

“We share OSHA’s commitment to protect the safety of workers and to keep regulatory programs up-to-date,” a spokesperson for the American Chemistry Council, a trade association, told IPS. “Our companies have reduced their recordable injury and illness incidence rates by 80 percent since 1990.”

Yet the spokesperson also warned against government overreach.

“As the administration moves forward,” he noted, “we urge them to continue to engage stakeholders and to pursue a clear, workable approach that will focus on workplace exposures that represent a significant risk of harm and that will yield the greatest safety benefits.”

Dangerously outdated

In regulating hazardous chemicals that workers come in contact with while on the job, the crux of OSHA’s oversight mechanism is a list of what are known as permissible exposure limits (PELs). These set caps on the amount of specific airborne chemicals – for instance, formaldehyde, asbestos or lead – beyond which would be considered unhealthy.

Understandably, these figures are haggled over by public health experts, labour representatives and business owners. However, far more concerning than the specifics of the PELs is how difficult – indeed, near impossible – it has been to add new compounds to this list.

As OSHA’s Michaels noted, of the tens of thousands of chemicals in regular use in the United States today, the agency’s PELs number only around 500 compounds. Further, this list has seen almost no change since it was created in 1971, with updates or additions for only some 30 chemicals.

“Many of these PELs are dangerously out of date and do not adequately protect workers,” Michaels stated.

“As a result, many workers are currently being exposed to levels of chemicals that are legal but not safe … The process through which OSHA issues new exposure limits or updates old ones is broken.”

Any major rewrite of OSHA’s chemicals oversight could have an inordinate impact on marginalised communities across the United States. Immigrants, racial minorities and the poor are all overrepresented in a spectrum of sectors that tend to see the highest use of hazardous chemicals.

Further, while U.S. labour regulations for the most part do not extend overseas, including at U.S.-owned ventures in other counties, significant regulatory changes in Washington could have important knock-on effects throughout certain sectors.

“This process does have the potential to improve working conditions abroad,” Matt Shudtz, the acting executive director at the Center for Progressive Reform, a watchdog group here, told IPS.

“Many multinational companies have safety departments. So if they have a plant in the United States where they’re addressing these hazards, they could choose to apply that same principle across the board.”

A spokesperson for OSHA likewise told IPS: “Hopefully the updated PELs will encourage employers all over the world to protect their workers from chemical hazards.”

Selective enforcement

Shudtz’s office is strongly supporting the new moves from OSHA as well as an eventual expansion of the agency’s PELs. But he also notes that a new rulemaking process is not the only way to deal with the current problem.

The legislation that governs OSHA gives it the power to write regulations for specific hazards. But this process is significantly constrained by a requirement, from the early 1990s, that the agency engage in a cost-benefit analysis for any regulatory action.

Such an approach has been a top priority for U.S. businesses and industry, and is reflected in the warning from the American Chemistry Council quoted at the beginning of this article.

But Shudtz and others point to a “catchall” provision, called the General Duty Clause, that allows OSHA to cite a company for hazardous behaviour if there exists both general industry agreement that the behaviour is dangerous and an obvious alternative.

“In the chemicals industry there are consensus-based standards that a lot of employers follow because they protect workers fairly well. And in general, those standards are more up to date than OSHA’s,” Shudtz says.

“The General Duty Clause says that OSHA can use those consensus standards as the basis for its enforcement. Unfortunately, they rarely take that opportunity.”

This is likely due to limited resources, as companies can challenge negative citations and thus drag out the process significantly and expensively. Yet Shudtz says that strong but selective enforcement under the General Duty Claus could achieve an important goal.

“If OSHA were to choose a chemical where there’s widespread exposure and a clear standard that could be applied, and engage in a few enforcement cases and really stick to their guns,” he says, “that would send an important message to other employers that they ought to be abiding by stricter standards.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Children in the town of Gueckedou, the epicentre of the ebola outbreak in Guinea. Credit: ©afreecom/Idrissa Soumaré

By Carey L. Biron
WASHINGTON, Oct 17 2014 (IPS)

President Barack Obama is under significant pressure to impose a range of restrictions on travellers coming to the United States from West African countries affected by the current Ebola outbreak.

Yet public health experts and development advocates warn that such restrictions would harm the already reeling economies of Ebola-hit countries in the region, and squeeze the international community’s ability to get health workers and goods into these countries.“If we get this wrong and just hunker down and hide, we will make this problem worse both in West Africa and in the United States.” -- Charles Kenny of the Center for Global Development

“An accelerated mobilisation of personnel and resources is necessary to control the Ebola epidemic in West Africa and care for patients, through the establishment of new Ebola management centres,” Tim Shenk, a press officer with Medecins Sans Frontieres, the humanitarian group that has been at the core of the international response to the epidemic, told IPS.

“For this reason, it is crucial that airlines continue flying to the affected region.”

Calls for halting flights and imposing visa restrictions have been floating around Washington since the virus’s spread caught the world’s attention over the summer. Yet these have strengthened substantially in recent days, following the confirmation of three cases of Ebola in the United States.

The first of those was unknowingly carried by a man from Liberia. He died last week after infecting two of the health workers attending to him, and the case has prompted an intense and at times vitriolic response.

“A temporary ban on travel to the United States from countries afflicted with the virus is something that the president should absolutely consider,” John Boehner, the leader of the U.S. House of Representatives and one of the most powerful figures in Washington, said Wednesday.

In fact there are no direct air connections between the United States and any of the three countries most affected by the current outbreak. Further, it would be extremely complex to impose such a ban in tertiary transit countries.

On the other hand, it would be possible to create additional hurdles for those applying for U.S. visas in West Africa. But this would do nothing to deal with, for instance, the many U.S. passport holders living in these countries, and would likewise be logistically complex.

Nonetheless, Boehner was echoing a clear tide of U.S. support for the imposition of travel restrictions. According to a poll released Tuesday, two-thirds of people in the United States would support “restricting entry” of incoming travellers from Ebola-afflicted countries.

The federal government’s response to Ebola has suddenly become a defining issue in the U.S. midterm elections, slated for next month.

Dangerous isolation

The current Ebola outbreak has now killed more than 4,000 people, almost all in Guinea, Liberia and Sierra Leone. On Thursday, United Nations Secretary-General Ban Ki-moon urged the international community to make available a billion dollars to allow those combating the disease to meet a target of reducing the virus’s transmission rates by the beginning of December.

In the United States, meanwhile, the public support for travel restrictions has risen by six percentage points since just last week. And lawmakers, many of whom are currently in the last stages of political campaigns, are responding.

Though Congress is currently on recess, lawmakers held a rare hearing on Ebola Thursday. By Thursday evening, members of Congress who supported some sort of travel restrictions outnumbered those who didn’t by 56 to 13, according to a list compiled by a Washington newspaper.

While those who do not support a travel ban were all Democratic, the support for such restrictions stretches across both parties.

“I’ve been struck by just how intense this political pressure has become, and the pressure is bipartisan,” J. Stephen Morrison, the director of the Global Health Policy Center at the Center for Strategic and International Studies (CSIS), a Washington think tank, told IPS.

“While the arguments made against travel bans have been solid, they don’t win the day with the public. Further, if the base population carrying the virus continues to grow, the threat won’t ease and neither will this pressure.”

Even as lawmakers increasingly funnel – and perhaps fuel – concern over Ebola in this country, the Obama administration remains adamant that it is not considering any travel restrictions beyond health scans and interviews at international airports.

“Shutting down travel to that area of the world would prevent the expeditious flow of personnel and equipment into the region,” Josh Earnest, the White House press secretary, told journalists Wednesday. “And the only way for us to stop this outbreak and to eliminate any risk from Ebola to the American public is to stop this outbreak at the source.”

Earnest did not reject the possibility completely, however, noting that a travel ban is “not on the table at this point.”

Yet many of those closest to the Ebola response warn that travel restrictions would be not only unfeasible but outright dangerous, exacerbating the outbreak.

“You don’t want to do something that inadvertently accelerates the economic collapse of these countries or impedes the flow of health workers and critically needed commodities,” CSIS’s Morrison says. “Our ability to get ahead of this crisis necessitates the flow, back and forth, of thousands of health-care workers and commodities.”

Indeed, such concerns have already been borne out. African Union aid workers, for instance, were recently delayed for a week getting into Liberia due to travel restrictions imposed in a number of African countries.

“It has been quite challenging over the last several months, because there have been a reduction in commercial flights … a reduction in shipping that comes into the country,” Debra Malac, the U.S. ambassador to Liberia, told journalists Thursday. “[That’s made it] very difficult to get things like food as well as supplies in that are critically needed in order to help address this epidemic.”

Devastating economies

U.S. travel restrictions could also pose significant economic risks, both to Ebola-hit countries and Africa as a whole.

“There’s a lot of air traffic between Africa and the U.S. that’s very important for trade and investment, the tourism industry, for the diaspora,” CSIS’s Morrison says. “All of that is reliant on air links, so how do you make sure you’re not kicking the pins out of those economic processes?”

Already there are widespread fears over the financial impacts of Ebola on Guinea, Liberia and Sierra Leone.

Earlier this week, the World Health Organisation warned that the virus now threatens “potential state failure” in these countries. Last week, the World Bank estimated that the epidemic could cost West African countries some 33 billion dollars in gross domestic product.

“If we get this wrong and just hunker down and hide, we will make this problem worse both in West Africa and in the United States,” Charles Kenny, a senior fellow at the Center for Global Development, a think tank here, told IPS.

“Imposing any kind of travel ban would tank the economy of these three countries, and that will have knock-on effects on dealing with the disease – increasing the suffering and the number of people with the disease.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Myanmar now has three years in which to put in place a series of transparency standards and publicly report on government extractives revenues, payments from mining and drilling companies, and related issues. Credit: Bigstock

By Carey L. Biron
WASHINGTON, Oct 15 2014 (IPS)

Lawmakers here are urging President Barack Obama to put transparency in the extractives sector at the centre of an upcoming trip to Myanmar.

While the government of Myanmar has recently engaged in a series of bilateral and multilateral pledges to make its lucrative but highly opaque mining and oil and gas industries more transparent, advocates increasingly warn that officials are failing to keep these promises."The real heart of the issue for civil society in Burma is the details of these contracts. They also want to start talking about the tremendous amount of money the Burmese government makes off of these oil and gas deals, and how most of that doesn’t benefit the people of Burma.” -- Jennifer Quigley

The U.S. government has been a key sponsor in facilitating these pledges, and many now see President Obama’s visit, slated for next month, as an important opportunity to prompt legal change in Myanmar, also known as Burma. Myanmar officials are currently revising related legislation, although little is known about these secretive talks.

Supporters say reforms, particularly around public information on extractives deals and revenues, could help to ensure that Myanmar’s significant natural resources wealth is used for development rather than simply enriching businesses close to the regime.

“Despite commitments to transparency and good governance, decision-making over the management of Burma’s national resources remains largely hidden from public scrutiny … the gap between the Burmese government’s promises and its delivery is widening,” 16 members of the U.S. Congress warned President Obama in a letter sent Tuesday.

“We therefore urge you, during your visit to Burma, to call on the Burmese government to ensure provisions on transparency and accountability are incorporated into revised laws, regulations and policies governing the extractives sector, and negotiated into new contracts and licenses.”

The letter, a copy of which was seen by IPS, includes backing from both Republicans and Democrats. Last year, the United States initiated a partnership between the Myanmar extractives industry and the Group of 8 (G8) rich countries, which could offer Obama additional leverage in demanding new transparency measures.

The lawmakers’ call comes not only a month ahead of President Obama’s planned trip to Myanmar (his second), but also as a global summit on extractives transparency begins in the country’s capital, Naypyidaw. The two-day meeting of the Extractives Industries Transparency Initiative (EITI), which promotes guidelines that are currently followed by 46 countries, comes just three months after Myanmar became one of the EITI’s newest candidate countries.

Under these guidelines, Myanmar now has three years in which to put in place a series of transparency standards and publicly report on government extractives revenues, payments from mining and drilling companies, and related issues.

Just a month after its EITI candidature was accepted, Myanmar signed several dozen contracts with domestic and international oil and gas companies. Yet according to Tuesday’s letter, the terms of those contracts remain secret, as are ongoing revisions to policies overseeing the extractives sector.

“The laws and regulations governing the extractive industries are currently being revised behind closed doors, with no public consultation,” the lawmakers state.

“Drafts of the first of these new pieces of legislation contain no provisions on public disclosure of data and do not reflect any of the promises of greater transparency made by the government through the EITI process.”

Beneficial owners

The contracts signed in August were for 36 oil and gas blocks, both on land and offshore, auctioned off to 46 local and global companies over the past year. While the details of those contracts remain under wraps, until recently almost nothing was known even of these companies’ owners.

Around the country’s EITI application, an international watchdog group called Global Witness began focusing on what’s known as ultimate beneficial ownership – information on who, ultimately, controls and benefits from a company’s activities. In June, the group had such information on the companies involved in just three of the blocks.

Yet after requesting information directly from the companies, Global Witness last week reported that many more companies had come forward with these details. The companies were also asked whether any of their beneficial owners were politically powerful individuals in Myanmar.

“In total, 28 companies have now participated in Global Witness’ ownership review, and we have been provided with full beneficial ownership details of all partners in 17 oil and gas blocks,” the group says in a new report, published Friday. “This shows that businesses can and will provide such information if they have an incentive, such as protection of their reputation, to do so.”

Global Witness says the information remains unverified and that a “hard core” of 18 companies continue to refuse to provide any information. Still, the group says this corporate response has already set a surprising international example.

“Not only is this significant locally, but it puts Myanmar in the unlikely position of setting a global precedent on transparency, as it’s the first time anywhere in the world that companies have systematically declared their ultimate ownership,” Juman Kubba, an analyst at Global Witness, told IPS.

“Our findings show that companies can reveal their owners if they’re pushed to do so. It’s now up to the Myanmar government with the support of the U.S. and other backers to make that push so that all oil, gas and mining company ownership in the country is public.”

Outside the framework

Still, some worry that the recent corporate disclosure wasn’t actually carried out through the EITI framework, thus suggesting that the government’s transparency pledges remain weak. They also dispute whether beneficial ownership is of foremost importance in the Myanmar context.

“This disclosure is incredibly important on the global scale, but when it comes to Burma the real concern has never been about ownership but rather about conflict related to resources,” Jennifer Quigley, the president of the U.S. Campaign for Burma, an advocacy group, told IPS.

“This wasn’t done through the EITI in this instance, and the real heart of the issue for civil society in Burma is the details of these contracts. They also want to start talking about the tremendous amount of money the Burmese government makes off of these oil and gas deals, and how most of that doesn’t benefit the people of Burma.”

Quigley says that Myanmar’s government has long been comfortable making pledges it has no intention of keeping, and she see little prospect of that changing in the near term. Still, she says the United States has linked itself so closely to extractives transparency in Myanmar that President Obama will need to broach the subject during his trip next month.

“This is really an area in which the U.S. has married itself to the Burmese government,” she says. “So they need to be paying more attention to the fact that the Burmese government isn’t living up to its EITI promises.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

A new road is built near Victoria Falls on the Zimbabwe-Zambia border. Credit: David Brossard/cc by 2.0

By Carey L. Biron
WASHINGTON, Oct 9 2014 (IPS)

The World Bank has initiated a major call to action for private sector investors around infrastructure projects in developing countries.

World Bank Group President Jim Yong Kim on Thursday launched a new initiative, worth some 15 billion dollars, aimed at motivating banks, pension funds and other institutional investors to turn their focus to the pressing, and growing, infrastructure needs in developing countries.“Institutional investors have deep pockets – insurance and pension funds have some 80 trillion dollars in assets.” -- World Bank President Jim Yong Kim

In announcing the new Global Infrastructure Facility (GIF), Kim estimated these needs would require up to a trillion dollars of additional investment each year through the end of this decade. That’s twice as much as these countries are currently spending.

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

“Given the scale of infrastructure financing needs in developing countries, we definitely welcome an initiative like this,” Marilou Uy, the incoming director of the Group of 24 (G24) developing countries and a former bank official, told IPS.

“The private sector’s role here is especially important: to find good models to work with, so that private investment in developing countries can start to rise again and grow to levels even higher than before.”

In a surprise to many, the bank’s sister organisation, the International Monetary Fund (IMF), this week came out forcefully in favour of public spending, particularly on infrastructure. The IMF and World Bank are currently holding semi-annual meetings here in Washington.

The GIF will start a number of pilot ventures later this year, reportedly with a focus on climate-friendly projects and those that can promote trade. But it will not be financing these initiatives directly.

Rather, it will aim to turn the private sector’s attention back towards the road, bridges, energy production and other large-scale physical projects that make up the foundation of any country’s economic and social development.

“Institutional investors have deep pockets – insurance and pension funds have some 80 trillion dollars in assets,” Kim said Thursday, speaking with reporters.

“But less than 1 percent of pension funds are allocated directly to infrastructure projects, and the bulk of that is in advanced countries. The real challenge is not a matter of money but a lack of bankable projects – a sufficient supply of commercially viable and sustainable infrastructure investments.”

Fundamental bottleneck

The World Bank is hoping the GIF will function as a conduit through which major investors, together with the development institution’s own experts, can advise governments how to structure infrastructure projects in order to entice investors looking for long-term opportunities. Kim said a “massive infrastructure deficit” in developing countries today constitutes a “fundamental bottleneck” in addressing poverty, the bank’s key mandate.

Perhaps in response to past criticisms, the bank also notes that the GIF will not simply try to move as much money into these projects as possible.

“We know that simply increasing the amount invested in infrastructure may not deliver on the potential to foster strong, sustainable and balanced growth,” Bertrand Badre, the institution’s managing director, said in a statement. “A focus on the quality of infrastructure is vital.”

The GIF will focus on fostering particularly complex partnerships between the public and private sectors, known as PPPs. In anticipation of Thursday’s announcement, the World Bank Group’s private-sector arm, the International Finance Corporation (IFC), has reportedly been ramping up its PPP units around the world.

Yet the growing dependence on the private sector in development aims continues to spark concern among many development advocates and anti-poverty campaigners, who worry that the goals of for-profit entities are often at odds with the public good.

“While the bank’s new infrastructure facility is welcome, we are concerned that any sudden push into new big-ticket infrastructure deals must improve the lives of ordinary people,” Nicolas Mombrial, the head of the Washington office of Oxfam International, a humanitarian and advocacy group, said Thursday.

“Therefore, the World Bank must ensure that new infrastructure lending comes fitted with proper safeguards in place to protect the poorest and most vulnerable communities from clients that might be more interested in profit over development. We need safeguards for people and not just for investors.”

The head of the GIF, meanwhile, cautions that the initiative is still in its very early days.

“I have been meeting with civil society organisations who were really interested in engaging with us on the GIF,” Jordan Schwartz, the official in charge of the new programme, told IPS.

“Like them, we want to ensure that decisions around infrastructure investment are sensitive to a wide range of environmental, social and economic considerations, so that not only is there benefit for the poor and for economic activity generally but so the investments are sustainable. We look forward to continuing that dialogue.”

PPP worries

Concerns around public-private partnerships are particularly notable around public water systems. In recent years, private companies around the world have shown growing interest in stepping into partnerships to resuscitate public water infrastructure that has often been underfunded for decades.

The World Bank’s IFC has been a major proponent of such deals. Yet some of these have sparked powerful backlash from critics who note that water privatisation has often resulted in higher costs and inequitable service.

This week, for instance, activists in Nigeria stepped up a campaign to urge the government to pull out of discussions with the IFC around a potential water project in Lagos. They say the scheme’s details are being kept from the public.

“Around the world, the IFC advises governments, conducts corporate bidding processes, designs complex and lopsided water privatisation contracts, dictates arbitration terms, and is part-owner of water corporations that win the contracts it designs and recommends, all while aggressively marketing the model to be replicated around the world,” Akinbode Oluwafemi, with Environmental Rights Action, a Nigerian advocacy group, told reporters Wednesday in Lagos, according to prepared remarks.

“Not only do these activities undermine democratic water governance, but they constitute an inherent conflict of interest within the IFC’s activities in the water sector, an alarming pattern seen from Eastern Europe to India to Southeast Asia.”

According to World Bank estimates, public money makes up some two-thirds of PPP financing around the world today. Watchdog groups say this underscores the heavy government subsidies that these projects have typically required, especially for important improvements.

“The GIF is part of a larger, renewed push for big infrastructure, which is troubling in part because of the history of human rights and environmental abuses associated with these projects,” Shayda Naficy, director of the International Water Campaign at  Corporate Accountability International, an advocacy group, told IPS.

“But it is also troubling because even where infrastructure is a dire need, as it is in the water sector, the emphasis being placed on the private sector is leading us in pursuit of illusory solutions. At least in the case of water, the private sector is not interested in making these investments in infrastructure.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Illegally logged timber seized by the Ayun villagers in Pakistan's Chitral district. A ban on trade in illegally harvested timber, wildlife and fish is omitted from the current fast-track legislation in the U.S. Congress. Credit: Imran Schah/IPS

By Carey L. Biron
WASHINGTON, Oct 7 2014 (IPS)

A year after a U.S. company was accused of engaging in the systematic importing of flooring made from illegally harvested timber, pressure is mounting on federal agencies currently investigating the allegations.

In September 2013, federal authorities executed search warrants of two of the offices of Lumber Liquidators, the largest specialty flooring company in the United States. The company was suspected of importing illegally logged hardwood from far eastern Russia, in contravention of U.S. law.“Illegal wood can’t hide and these products can’t be laundered as easily as they have been in the past." -- Alexander von Bismarck

Around the same time, a civil society group, the Environmental Investigation Agency (EIA), published a detailed report on the accusations, including extensive evidence suggesting that Lumber Liquidators was able to trade in this illicit hardwood through a Chinese supplier. In May, Greenpeace again questioned the company for doing business with suppliers reportedly linked to illegal logging in the Amazon.

Lumber Liquidators is currently being investigated by three U.S. agencies, and these probes are ongoing. While observers say that the complexities of such an international investigation would typically require timeframes of a year or more, in recent days green groups and others have stepped up pressure on the U.S. government to ensure accountability in the Lumber Liquidators case.

“There’s real reason to believe that Lumber Liquidators broke the law, and we’re particularly interested in this case being fully investigated and enforced,” Jesse Prentice-Dunn, with the trade programme at the Sierra Club, a conservation and advocacy group, told IPS.

“We’ve been educating our members about U.S. law on this issue, and they have been very enthusiastic. A huge number of our members are now asking President Obama to fully enforce these laws.”

On Friday, the Sierra Club announced that more than 100,000 of its members had submitted petitions warning that “many companies will not move to make their supply chain sustainable until they see strong enforcement of the law.” Similar concerns were voiced in a letter sent last week by environment and organised labour groups to the three U.S. officials in charge of the Lumber Liquidators probes.

Meanwhile, Lumber Liquidators also took fresh action last week, announcing a new sustainability policy and website. In a release, the company noted that the new policy includes DNA testing of harvested timber, internal and external lumber audits, as well as a move towards sourcing within North America and “away from regions considered to have lower oversight”.

Yet in making the announcement, the company, which has maintained its innocence throughout the past year, outraged watchdog groups by suggesting that its past missteps had been more about communications than systemic problems.

“Admittedly, we’ve been more focused on our sustainability efforts than communicating broadly about them,” Ray Cotton, a Lumber Liquidators vice president, said in a statement unveiling the new website.

Asked by Canadian reporters whether it had ever sold wood “sourced illegally in the Russian Far East”, the company says “No,” in an official statement provided by EIA. It also claims both that the EIA investigation “contained fundamental inaccuracies and unsubstantiated claims” and that the report never alleged that Lumber Liquidators had violated U.S. law.

“Lumber Liquidators’ statement is extremely disturbing,” Alexander von Bismarck, the executive director of EIA’s U.S. office, told IPS.

“Certainly that doesn’t give folks confidence in the company’s sustainability plan, if the overall focus is simply on improving communications. Rather, the first step towards substantive action would need to be taking a sober view on what has actually happened.”

In the balance

The U.S. law at the heart of the federal investigations is known as the Lacey Act, passed in 2008. It is widely seen as a pioneering piece of legislation, and one that some say is already having a global impact, including in China.

As in the allegations surrounding Lumber Liquidators, China has emerged in recent years as a major intermediary for the global wood industry, both licit and illicit. Over the past decade, Chinese exports of wood products have increased by upward of 30 percent per year.

Today, the country is the world’s largest exporter of wood products, with more than 12 percent of the global market, valued at almost 12 billion dollars in 2012. Yet that sector is also said to be one of the most opaque of any commercial market with which the United States trades.

Still, EIA’s von Bismarck says that some changes have started to take place in how the Chinese authorities are approaching the issue of illegal wood laundering. He also notes that this is what makes the Lumber Liquidators case – and the potential response by U.S. authorities, following the current investigations – so important.

While the Chinese authorities, for the first time, have started discussing illegal logging in international fora, the response has been incomplete, von Bismarck warns. This is largely because of the extent to which companies are still able to ignore laws like the Lacey Act.

“That allows Chinese industry to make the assessment that they don’t need to change their practices – because the wood is still getting in,” he says.

“So the whole situation is hanging in the balance, and the Lumber Liquidators case is a critical signal to the Chinese industry associations that are currently deciding which way they are going to go. That will decide whether, in a few years, we will have a new law of the land for the wood trade.”

While some environmentalists have started to criticise the Lacey Act, von Bismarck says the current investigation is proof that the legislation is working.

“The fact that the U.S. government is investigating a case that involves illegal logging in one country and manufacturing in another before it gets to the United States is a very positive sign for the overall efficacy of the law,” he says.

“Illegal wood can’t hide and these products can’t be laundered as easily as they have been in the past, and that could bring about a sea change in the industry. That probably hasn’t yet been digested by all corners of the global wood industry, but it will be.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

The Democratic Republic of Congo (DRC) has the world’s second-largest tropical forest landscape. Here, slash and burn agriculture and charcoal are the main causes of greenhouse gases emissions. Credit: Taylor Toeka Kakala/IPS

By Carey L. Biron
WASHINGTON, Oct 3 2014 (IPS)

Heads of state, civil society groups and the leaders of some of the world’s largest companies this week urged their peers to sign on to a landmark new global agreement aimed at halting deforestation by 2030, even as others are warning the accord is too lax.

The New York Declaration on Forests was signed last week by some 150 parties at a United Nations-organised climate summit. Outlining pledges and goals for both the public and private sectors, for the first time the declaration set a global “deadline” for deforestation: to “At least halve the rate of loss of natural forest globally by 2020 and strive to end natural forest loss by 2030.”“The 2030 timeline would allow deforestation to continue for a decade and a half. By then the declaration could be self-fulfilling, as there might not be much forest left to save.” -- Susanne Breitkopf of Greenpeace

The declaration offered one of the most concrete outcomes of the U.N. summit, and underscored new global interest in the climate-related potential of conserving the world’s forest cover. The agreement’s text estimates that achieving the goals set out in the accord could reduce greenhouse gas emissions by up to 8.8 billion tonnes per year by 2030.

Yet since the agreement’s unveiling, some groups have voiced stark concerns, particularly around the declaration’s extended timeline and weak enforcement mechanisms. Indeed, the agreement is legally binding on neither states nor companies.

“The 2030 timeline would allow deforestation to continue for a decade and a half. By then the declaration could be self-fulfilling, as there might not be much forest left to save,” Susanne Breitkopf, a senior political advisor with Greenpeace, told IPS.

“Equally, private companies shouldn’t be allowed to continue deforesting and sourcing from deforestation until 2020 – they should stop destructive practices and human rights violations immediately.”

On Wednesday, a Nigerian development group similarly called into question the declaration’s timeframe.

“The declaration seems to make those who have the capacities for massive destruction of community forests to think that they have up to 2020 to continue destruction unchecked, and unencumbered. This is dangerous,” the Rainforest Resource and Development Centre said in a statement.

“Some of these companies have the capabilities to wipe out forests the size of Cross River State of Nigeria in one year. Collectively, they have the capacity to wipe out valuable community forest areas up to the size of India in a few years.”

Instead, the centre says the New York Agreement should have put in place “definite sanctions” starting this year.

Powerful alliance

The declaration was initially endorsed by 32 national governments, though Brazil remains a notable holdout. In addition to halting deforestation, the agreement aims to restore some 350 million hectares of degraded lands by 2030.

The accord was also formally backed by 40 multinational companies and financial firms, and seeks to “help meet” private-sector goals of halting deforestation linked to commodities by the end of the decade. Separately, the Consumer Goods Forum (CGF), consisting of 400 large companies with global sales of three trillion dollars, has pledged to remove deforestation from its supply chains by 2020.

“A powerful alliance of business, governments and civil society has come together to sign the New York Declaration to stop the destruction of natural forests and to restore those that have been degraded,” Helen Clark, the administrator of the United Nations Development Programme, said in a video posted Tuesday.

“To deliver on the declaration, companies and communities are asking governments to show strong leadership in reaching a new climate agreement in Paris next year. So we invite all stakeholders to join us in this effort by signing on to the New York Declaration on Forests.”

Clark was joined in this call by the leaders of Norway and Liberia, as well the CEOs of the consumer goods giant Unilever, the palm oil supplier Golden Agri Resources and others. Major civil society voices, including the World Wildlife Foundation (WWF) and World Resources Institute (WRI), both U.S.-based organisations, likewise supported the declaration.

WRI, a prominent think tank, has called the declaration “the clearest statement to date by world leaders that forests can be a major force in tackling the climate challenge.” Further, the institute estimates that a restoration of just 150 million hectares of degraded lands could help to feed an additional 200 million people by 2030.

According to U.N. statistics, some 13 million hectares of forest are disappearing, on average, each year. While the importance of those forests is currently receiving new interest in terms of slowing global climate change, forest destruction also has major impact on the economies and survival of local communities.

In many places, illegal forest clearing is closely related to poor governance and corruption. Yet the fact remains that much of today’s deforestation is fuelled by large-scale agricultural production to supply commodities to other countries.

According to findings published last month by Forest Trends, a watchdog group here, at least half of global deforestation is taking place illegally and in support of commercial agriculture – particularly to supply overseas markets. Overall, some 40 percent of all globally traded palm oil and 14 percent of all beef likely comes from illegally cleared lands, Forest Trends estimates.

Years of inaction

As part of the New York Declaration, five European countries pledged to develop new procurement policies aimed at cutting down on the consumption of products linked to deforestation. In addition, the declaration was backed by a second agreement between three of the world’s largest palm oil companies to help protect forests in Indonesia, a major producer.

“We find it very encouraging that the biggest players in the palm oil industry globally are finally acknowledging their responsibility for the tremendous destruction palm oil expansion has and is causing,” Laurel Sutherlin, a communications strategist at the Rainforest Action Network, an advocacy group that is not planning to endorse the New York Declaration, told IPS.

“But so much time has been lost due to inaction that we are now at a point where a 2030 voluntary deadline is simply not sufficient to address the urgency of the problem. The fact is, deforestation rates in Indonesia are continuing to rise, conflicts between companies and communities are escalating, and reports of labour abuses are increasing.”

Greenpeace, too, has publicly declined to back the New York Declaration. The group’s Breitkopf points out that the agreement is weaker than certain existing deforestation accords, and thus could even dampen forward momentum.

“Most governments long ago signed up to the Convention on Biological Diversity,” she says, referring to the 1992 treaty. “That agreement obliges them to halt biodiversity loss and manage forests sustainably by 2020. Now, the New York Declaration threatens to undermine previous commitments.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

The United States will begin developing a national action plan on responsible business practices, following on several years of related advocacy from civil society.

The plan will detail how the United States will implement landmark U.N. guidelines outlining the responsibility of multinational businesses to respect human rights. While the United Nations has urged participating governments to draft concrete plans for putting into practice the guidelines, known as the Guiding Principles on Business and Human Rights, thus far only three countries have done so – Denmark, the Netherlands and the United Kingdom.“What we’ll expect is what we’ve seen in the past, where industry is not going to want anything that’s binding.” -- Human Rights Watch’s Arvind Ganesan

Yet on the sidelines of last week’s U.N. General Assembly, President Barack Obama for the first time announced that his administration would begin formulating such a plan.

“[W]e intend to partner with American businesses to develop a national plan to promote responsible and transparent business conduct overseas,” the president stated. “We already have laws in place; they’re significantly stronger than the laws of many other countries. But we think we can do better.”

Obama suggested that clarity around responsible business practices is good for all involved, including industry and local communities.

“Because when [companies] know there’s a rule of law, when they don’t have to pay a bribe to ship their goods or to finalise a contract, that means they’re more likely to invest, and that means more jobs and prosperity for everybody,” the president said.

A White House fact sheet noted that the plan would aim to “promote and incentivize responsible business conduct, including with respect to transparency and anticorruption.” It also stated that the plan would be “consistent” with the U.N. Guiding Principles and similar guidelines from the OECD grouping of rich countries.

Additional details on the formulation process are not yet available, though observers expect a draft next year. For now, however, advocacy groups are applauding the president’s announcement as preliminary but significant.

“This could end up being a very important step, but now we’ll be looking to see how the U.S. articulates how it expects companies to respect rights at home and abroad,” Arvind Ganesan, the director of the business and human rights programme at Human Rights Watch, told IPS.

“More importantly, we’ll be looking to see whether this process results in any teeth – mechanisms to ensure that companies act responsibly everywhere.”

Task of implementation

In 2011, the U.N. Human Rights Council unanimously backed the Guiding Principles, which are meant to apply to all countries and companies operating both domestically and internationally.

Yet thus far, formal adherence to the Guiding Principles has been only stuttering. In late June, the council called on governments to step up the process of drafting national action plans.

The United States – which endorsed the June resolution – has been a key focus for many in this process, given the overwhelming size of its economy and the number of multinational companies that it hosts.

Further, U.S. companies have stood accused of a broad spectrum of rights abuse, from extractives companies poisoning local water supplies to private security companies killing unarmed civilians. Often, of course, such problems impact most directly on poor and marginalised communities in developing countries.

The Guiding Principles mandate that governments take on the responsibility to prevent rights abuses by corporations and other third parties. States are also required to provide judicial “remedy” for any such abuse.

This is powerful language, but it remains up to governments to decide how exactly to implement the guidelines. Here, watchdog groups are less optimistic.

While Ganesan welcomes the actions by the three European countries that have developed implementation plans, he has reservations as to how substantive they are.

“Few of them have any real strength,” he says. “While they ask their companies to adopt the Guiding Principles, none of them have put together any kind of mechanism aimed at ensuring that happens.”

In the context of the U.S. announcement, then, there is a sense of caution around whether the United States will be able to put in place rules that require action from corporations.

“We are thrilled to see the United States take on this important initiative,” Sara Blackwell, a legal and policy associate with the International Corporate Accountability Roundtable (ICAR), said in a statement.

Yet Blackwell notes that her office will continue to advocate for a U.S. action plan that goes beyond concerns merely around transparency and corruption.

Rather, she says, any plan needs to include “clear action on important issues such as access to effective remedy for victims of business-related human rights harms and the incorporation of human rights considerations into the U.S. federal government’s enormous influence on the marketplace through its public procurement activities.”

Voluntary initiatives

ICAR has been at the forefront of civil society engagement around the call for the development of national action plans on responsible business practice, including by the United States.

In June, the group, along with the Danish Institute for Human Rights, published a toolkit to guide government officials intent on formulating such plans. Among other points, the toolkit urges the participation of all stakeholders, including those who have been “disempowered”.

In his announcement, President Obama appeared to suggest that the drafting of a U.S. plan would rest on participation from business entities, though it is not yet clear how companies will react. (Three major industry lobby groups contacted for comment by IPS failed to respond.)

At the outset, though, rights advocates are worried by the examples coming out Europe, where governments appear to be relying on voluntary rather than rule-based initiatives.

“What we’ll expect is what we’ve seen in the past, where industry is not going to want anything that’s binding,” Human Rights Watch’s Ganesan says.

“They’ll be happy to agree to accepting human rights in rhetorical or aspirational terms, but they will not want any rules that say they must take certain actions or, for instance, risk losing government contracts. Nonetheless, there is now a real opportunity for the U.S. government to mandate certain actions – though how the administration articulates that will be a critical test.”

Meanwhile, concerns around the potential laxity of the Guiding Principles have already led to a division among rights advocates as to whether a new international mechanism is needed. In a landmark decision at the end of June, the U.N. Human Rights Council voted to begin negotiations towards a binding international treaty around transnational companies and their human rights obligations.

Yet this move remains highly controversial, even among supporters. Some are worried that the treaty idea remains unworkably broad, while others warn that the new push will divert attention from the Guiding Principles.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

U.S. President Barack Obama speaks at the U.N. Climate Summit 2014. Credit: UN Photo/Kim Haughton

By Carey L. Biron
WASHINGTON, Sep 24 2014 (IPS)

All international development assistance and investments from the United States will now be required to take into account the potential impacts of climate change, according to a new rule signed Tuesday by President Barack Obama.

When designing development programmes of any type, federal agencies will need to factor in climate resilience, referring to the ability of a host country or community to anticipate and prepare for global warming-related changes. Those agencies will likewise be required to encourage similar planning by multilateral development institutions.“Climate resilience is of critical importance to the 500 million smallholder farmers that provide the majority of food in developing countries.” -- Frank Rijsberman, CEO of the CGIAR Consortium

“The president is setting the right course with his executive order,” Jennifer Morgan, director of the climate and energy programmes at the World Resources Institute, a think tank here, said in a statement. “We can’t pursue development around the world without recognising the risks that climate change poses every day.”

President Obama announced the new directive at the opening of a United Nations summit on climate that brought together some 120 heads of state to discuss new commitments. There, the president also announced a suite of new “tools” and initiatives aimed at assisting developing countries prepare for the impacts of a changing climate, particularly around the sharing of scientific and weather data.

“Today, I’m directing our federal agencies to begin factoring climate resilience into our international development programmes and investments,” the president said U.N. headquarters in New York.

“And I’m announcing a new effort to deploy the unique scientific and technological capabilities of the United States, from climate data to early-warning systems … to help vulnerable nations better prepare for weather-related disasters, and better plan for long-term threats like steadily rising seas.”

The president did not announce a new U.S. carbon emissions-reduction target during Tuesday’s highly anticipated address. However, he did pledge that such a target would be made public by early next year.

Safeguarding progress

Acknowledging that those countries that bear the least responsibility for climate change “often stand to lose the most”, Obama noted that U.S. assistance for climate-related adaptation efforts has expanded eightfold since 2009.

In an executive order detailing the new mandates, also signed Tuesday, Obama warns that failure to take into account the potential impacts of climate change could “roll back decades of progress in reducing poverty and improving economic growth in vulnerable countries” and weaken the overall effectiveness of U.S. development assistance.

“Development investments in areas as diverse as eradicating malaria, building hydropower facilities, improving agricultural yields, and developing transportation systems will not be effective in the long term if they do not account for impacts such as shifting ranges of disease-carrying mosquitoes, changing water availability, or rising sea levels,” a White House fact sheet notes.

The new mandate could mean, for instance, ensuring that a new road built with U.S. assistance is engineered and sited to withstand strengthened flooding, or that a planned school is moved out of the way of forecasted rising sea waters. It could also mean increased aid focus on agricultural seeds and techniques able to withstand weather extremes, as well as data to allow for better planning by farmers.

“Climate resilience is of critical importance to the 500 million smallholder farmers that provide the majority of food in developing countries,” Frank Rijsberman, the CEO of the CGIAR Consortium, a global organisation that promotes agricultural research to advance food security, told IPS.

“It is an important step for the U.S. to announce that it will mainstream climate resilience in all its development investments – as did a number of other countries and multilateral organisations at the summit.”

A new working group, led by the heads of the U.S. Treasury and USAID, the country’s main foreign aid agency, will now come up with guidelines for integrating these considerations into federal strategies.

But U.S. development agencies are already expressing excitement about the new requirements. An official with USAID told IPS that “it is essential that, as the world’s leading development agency, USAID continue to set a high bar for building resilience into all efforts to end extreme poverty and build flourishing societies.”

An official with the Overseas Private Investment Corporation (OPIC), the U.S. government’s development finance agency, likewise called the executive order “incredibly significant”.

“OPIC is eager to take part in this administration-wide action that underscores the seriousness of the challenge the whole world faces from a changing climate,” Charles Stadtlander, an OPIC spokesperson, told IPS. “If one thing is clear, it’s more cost-effective to act now than to wait until after it’s too late.”

Low-emissions development

In recent years, OPIC has been increasingly lauded by environmentalists and development groups for its overseas investments in renewable energies. Last year, Stadtlander says, those commitments topped 1.2 billion dollars, marking more than a 50-fold increase since 2007.

For some, it is expanding such efforts, and the U.S. government’s still-nascent focus on overseas alternative and low-carbon energy sources, that remains of paramount importance.

Importantly, the new executive order requires that federal agencies “continue seeking opportunities to help international partners promote sustainable low-emissions development”. It also orders the U.S. National Security Council, within a year, to bring together federal agencies to “explore further mitigation opportunities” in U.S. development activities, and to come up with recommendations for additional action.

“An important element of this order is the mandate to continue seeking avenues for mitigation and low-carbon development,” Justin Guay, a Washington representative for the Sierra Club, a conservation and advocacy group, told IPS.

“Already important initiatives like OPIC’s Africa Clean Energy Finance programme are building a pipeline, and new loan guarantees and the private investment they’ll leverage can take that pipeline to scale.”

Guay points to a new U.S. government project, announced this summer, called Beyond the Grid, aimed at expanding renewable energies in Africa. Strengthening that initiative would now offer a key opportunity to put the executive order’s mitigation mandate into action, Guay notes.

Meanwhile, others are expressing concerns over the impact in developing countries of new resilience assistance from the West.

For instance, while President Obama and others on Tuesday inaugurated a new Global Alliance for Climate-Smart Agriculture, aimed at addressing food security in the context of a changing climate, some farmers in developing countries worry the initiative will increase their dependence on foreign interventions.

“Climate smart agriculture will lead to further consolidation of land … creating dependency on so-called new technologies,” La Via Campesina, a global group of smallholders, said Tuesday, “while ignoring traditional tried-and-true adaptive farming techniques and stewardship of seed varieties.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Seventy-three countries and 22 lower-level governments offered formal support Monday for a global price on carbon dioxide emissions, including China, Russia and the European Union.

Together, these countries account for more than half of all greenhouse gas emissions, according to the World Bank, which unveiled a major new push towards global carbon pricing. Other backers include South Africa, Indonesia, Mexico and the Philippines.“If governments put good policies and carbon pricing in place, investors can help finance the transition to a low carbon economy.” -- Stephanie Pfeifer

The World Bank also announced that more than a thousand corporations and investors have recently signed several high-level statements on the issue, urging policymakers to take substantive steps towards a global price on carbon emissions.

The data comes as more than 100 government leaders are in New York this week for a United Nations-sponsored summit where governments and the private sector are to announce new climate-related commitments. Around that event, a record 310,000-plus demonstrators took to the streets in New York on Sunday, urging action.

“Today we see real momentum,” World Bank Group President Jim Yong Kim said Monday. “Governments representing almost half of the world’s population and 52 percent of global GDP have thrown their weight behind a price on carbon as a necessary, if insufficient, solution to climate change and a step on the path to low carbon growth.”

While there are several ways to impose a financial cost on carbon – including a tax, a trading system and others – proponents say any of these would bring multiple benefits. They would create economic incentives to both reduce emissions and boost the development of renewable energies, while resulting revenues could be used to finance adaptation and mitigation efforts.

Still, carbon prices have also been blamed for raising costs on day-to-day items, including food. Poorly structured carbon taxes could thus impact most immediately on the poor.

The new support builds on a public statement of backing for carbon pricing that the World Bank published in June. At that time, 40 national and more than 20 sub-national carbon taxes or trading schemes had been set up, accounting for a bit more than a fifth of global emissions.

On Monday, Kim also announced a new public- and private-sector grouping, the Carbon Pricing Leadership Coalition, that will begin meeting to “advance carbon pricing solutions” in advance of widely anticipated negotiations next year in Paris. There, the global community is expected to agree on a new framework for responding to climate change.

“Carbon pricing if expanded to this scale and then globally has the potential to bring down emissions in a way that supports clean energy and low-carbon growth while giving businesses the flexibility to innovate and find the most efficient choices,” the World Bank noted in a feature story on the new initiatives Monday. “This is a wake-up moment.”

Investor energy

Of course, government representatives have been meeting to discuss options around combating climate change for decades, and there is near universal agreement today that actions taken thus far have not been commensurate with the threat.

Further, market-based schemes such as carbon pricing would only offer a partial solution. Yet even so, the World Bank’s new list of supporters doesn’t include some of the most important players, including the United States and India.

The current phase in the climate discussion is nonetheless distinctive for the new corporate support for some sort of global action around climate change, particularly for a broad price on carbon. Just in the past few days, a series of major calls to action have been made by multinational companies and some of the world’s largest institutional investors.

“Support for carbon pricing among the investor community is greater than it’s ever been,” Stephanie Pfeifer, chief executive of the Institutional Investors Group on Climate Change (IIGCC), told IPS.

“Climate change puts the investments and savings of million of people at risk. Investors support ambitious action on climate change and a strong carbon price to reduce these risks and to unlock capital for low carbon investments.”

The London-based IIGCC was involved in developing a major statement from global investors on climate change. The most recent version, released last week, included nearly 350 signatories representing some 24 trillion dollars in assets, and called for carbon pricing, greater support for renewable energy and efficiency, and the phasing out of fossil fuel subsidies.

“Investors are willing and able to invest in low carbon energy,” Pfeifer says. “If governments put good policies and carbon pricing in place, investors can help finance the transition to a low carbon economy.”

Environment and economy

The newly stepped-up interest around climate change on the part of corporate executives and investors underscores a strengthening understanding of climate issues as posing threats beyond the environmental. Increasingly, corporations are being forced to explain to their shareholders how climate change and related regulation could impact on their underlying finances – and how prepared they are for that eventuality.

Last week, a widely discussed study found that many of the world’s largest companies, including the oil giant ExxonMobil and financial services firm Goldman Sachs, are already incorporating internal carbon prices into their financial planning and risk management. “[M]ajor corporations not only recognize climate-related regulatory risks and opportunities, but also are proactively planning for them and are outpacing their governments in thinking ahead,” the report found.

Some proponents say this engagement by the private sector could now provide key energy ahead of the Paris climate negotiations next year.

“These are vast and marked changes, and very different from any other time I can remember. The level of interest on the part of the private sector is radically different than it was even five years ago,” Mindy Lubber, the president of Ceres, a U.S. coalition of investors and others focused on sustainability, told IPS.

“It goes without saying that financial and corporate leaders calling for action does change the debate. It moves the discussion from one of the environment versus the economy to one about both.”

Still, some are concerned that the new focus on the private sector’s role in addressing climate change, including at this week’s U.N. summit, is inverting the proper role of government and state regulation.

“We’re increasingly seeing the private sector telling government how companies can be supported on energy and climate issues,” Janet Redman, director of the Climate Policy Program at the Institute for Policy Studies, a Washington think tank, told IPS.

“That’s a perversion, with public sector energy going into supporting the private sector. Instead, the public sector has to set goals and a framework for how we all need to act, both individuals and the private sector.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Paraguayan Indians fight to enforce collective ownership of their land at the Inter-American Court. Credit: Milagros Salazar/IPS

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

Starting next year, a new grant-making initiative will aim to fill what organisers say has been a longstanding gap in international coordination and funding around the recognition of community land rights.

The project could provide major financial and technical support to indigenous groups and forest communities struggling to solidify their claims to traditional lands. Proponents say substantive action around land tenure would reduce growing levels of conflict around extractives projects and land development, and provide a potent new tool in the fight against global climate change.“Yes, the forests and other non-industrialised land hold value. But we must also value the rights of those who inhabit these areas and are stewards of the natural resources they contain." -- Victoria Tauli-Corpuz

The new body, the International Land and Forest Tenure Facility, is being spearheaded by the Rights and Resources Initiative (RRI), a Washington-based coalition, though the fund will be an independent institution. The Swedish government is expected to formally announce the project’s initial funding, some 15 million dollars, at next week’s U.N. climate summit in New York.

“The lack of clear rights to own and use land affects the livelihoods of millions of forest-dwellers and has also encouraged widespread illegal logging and forest loss,” Charlotte Petri Gornitzka, the director general of the Swedish International Development Cooperation Agency, said Wednesday.

“Establishing clear and secure community land rights will enable sustainable economic development, lessen the impacts of climate change and is a prerequisite for much needed sustainable investments.”

As Gornitzka indicates, recent research has found that lands under strong community oversight experience far lower rates of deforestation than those controlled by either government or private sector entities. In turn, intact forests can have a huge dampening effect on spiking emissions of carbon dioxide.

This is a potential that supporters think they can now use to foster broader action on longstanding concerns around land tenure.

Governments claim three-quarters

National governments and international agencies and mechanisms have paid some important attention to tenure-related concerns. But not only have these slowed in recent years, development groups say such efforts have not been adequately comprehensive.

“There is today an unprecedented convergence of demand and support for this issue, from governments, private investors and local people. But there remains no dedicated instrument for supporting community land rights,” Andy White, RRI’s coordinator, told IPS.

“The World Bank, the United Nations and others dabble in this issue, yet there has been no central focus to mobilise, coordinate or facilitate the sharing of lessons. And, importantly, there’s been no entity to dedicate project financing in a strategic manner.”

According to a study released Wednesday by RRI and Tebtebba, an indigenous rights group based in the Philippines, initiatives around land tenure by donors and multilaterals have generally been too narrowly tailored. While the World Bank has been a primary multilateral actor on the issue, for instance, over the past decade the bank’s land tenure programmes have devoted just six percent of funding to establishing community forest rights.

“Much of the historical and existing donor support for securing tenure has focused on individual rights, urban areas, and agricultural lands, and is inadequate to meet the current demand from multiple stakeholders for secure community tenure,” the report states.

“[T]he amount of capital invested in implementing community tenure reform initiatives must be increased, and more targeted and strategic instruments established.”

As of last year, indigenous and local communities had some kind of control over around 513 million hectares of forests. Yet governments continue to administer or claim ownership over nearly three-quarters of the world’s forests, particularly in poor and middle-income countries.

From 2002 to 2013, 24 new legal provisions were put in place to strengthen some form of community control over forests, according to RRI. Yet just six of these have been passed since 2008, and those put in place recently have been relatively weaker.

Advocates say recent global trends, coupled with a lack of major action from international players, have simply been too much for many developing countries to resist moving aggressively to exploit available natural resources.

“Yes, the forests and other non-industrialised land hold value,” Victoria Tauli-Corpuz, the United Nations’ special rapporteur on indigenous peoples and a member of the advisory group for the International Land and Forest Tenure Facility, said in a statement.

“But we must also value the rights of those who inhabit these areas and are stewards of the natural resources they contain. Failure to do so has resulted in much of the local conflict plaguing economic development today.”

Unmapped and contested

Experts say the majority of the world’s rural lands remain both unmapped and contested. Thus, the formalisation of land tenure requires not only political will but also significant funding.

While new technologies have made the painstaking process of mapping community lands cheaper and more accessible, clarifying indigenous rights in India and Indonesia could cost upwards of 500 million dollars each, according to new data.

Until it is fully up and running by the end of 2015, the new International Land and Forest Tenure Facility will operate on the Swedish grant, with funding from other governments in the works. That will allow the group to start up a half-dozen pilot projects, likely in Indonesia, Cameroon, Peru and Colombia, to begin early next year.

Each of these countries is facing major threats to its forests. Peru, for instance, has leased out nearly two-thirds of its Amazonian forests for oil and gas exploration – concessions that overlap with at least 70 percent of the country’s indigenous communities.

“If we don’t address this issue we’ll continue to bump into conflicts every time we want to extract resources or develop land,” RRI’s White says.

“This has been a problem simmering on the back burner for decades, but now it’s reached the point that the penetration of global capital into remote rural areas to secure the commodities we all need has reached a point where conflict is breaking out all over.”

The private sector will also play an important role in the International land and Forest Tenure Facility, with key multinational companies sitting on its advisory board. But at the outset, corporate money will not be funding the operation.

Rather, White says, companies will help in the shaping of new business models.

“The private sector is driving much of this damage today, but these companies are also facing tremendous reputational and financial risks if they invest in places with poor land rights,” he says.

“That growing recognition by private investors is one of the most important shifts taking place today. Companies cannot meet their own growth projections as well as their social and environmental pledges if they don’t proactively engage around clarifying local land rights.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

A multilateral arbitration panel here began final hearings Monday in a contentious and long-running dispute between an international mining company and the government of El Salvador.

An Australian mining company, OceanaGold, is suing the Salvadoran government for refusing to grant it a gold-mining permit that has been pending for much of the past decade. El Salvador, meanwhile, cites national laws and policies aimed at safeguarding human and environmental health, and says the project would threaten the country’s water supply.“This mining process would use some really poisonous substances – cyanide, arsenic – that would destroy the environment. Ultimately, the people suffer the consequences." -- Father Eric Lopez

The country also claims that OceanaGold has failed to comply with basic requirements for any gold-mining permitting. Further, in 2012, El Salvador announced that it would continue a moratorium on all mining projects in the country.

Yet using a controversial provision in a free trade agreement, OceanaGold has been able to sue El Salvador for profits – more than 300 million dollars – that the company says it would have made at the goldmine. The case is being heard before the International Centre for the Settlement of Investment Disputes (ICSID), an obscure tribunal housed in the Washington offices of the World Bank Group.

“The case threatens the sovereignty and self-determination” of El Salvador’s people, Hector Berrios, coordinator of MUFRAS-32, a member of the Salvadoran National Roundtable against Metallic Mining, said Monday in a statement. “The majority of the population has spoken out against this project and [has given its] priority to water.”

The OceanaGold project would involve a leaching process to recover small amounts of gold, using cyanide and, critics say, tremendous amounts of water. Those plans have made local communities anxious: the United Nations has already found that some 90 percent of El Salvador’s surface water is contaminated.

On Monday, a hundred demonstrators rallied in front of the World Bank building, both to show solidarity with El Salvador against OceanaGold and to express their scepticism of the ICSID process more generally. The events coincided with El Salvador’s Independence Day.

“We’re celebrating independence but what we’re really celebrating is dignity and the ability of every person to enjoy a good life, not only a few,” Father Eric Lopez, a Franciscan friar at a Washington-area church that caters to a sizable Salvadoran community, told IPS at the demonstration.

“This mining process would use some really poisonous substances – cyanide, arsenic – that would destroy the environment. Ultimately, the people suffer the consequences: they remain poor, they are sick, women’s pregnancies suffer.”

Provoking unrest?

The case’s jurisdictions are complicated and, for some, underscore the tenuousness of the ICSID’s arbitration process around the Salvador project.

It was another mining company, the Canada-based Pacific Rim, that originally discovered a potentially lucrative minerals deposit along the Lempa River in 2002. The business-friendly Salvadoran government at the time (since voted out of power) reportedly encouraged the company to apply for a permit, though public concern bogged down that process.

Frustrated by this turn of events, Pacific Rim filed a lawsuit against El Salvador under a provision of the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) that allowed companies to sue governments for impinging on their profits. While Canada, Pacific Rim’s home country, is not a member of DR-CAFTA, in 2009 the company created a subsidiary in the United States, which is.

In 2012, ICSID ruled that the lawsuit could continue, pointing to a provision in El Salvador’s investment law. The country’s laws have since been altered to prevent companies from circumventing the national judicial system in favour of extra-national arbiters like ICSID.

Last year, OceanaGold purchased Pacific Rim, despite the latter’s primary asset being the El Salvador gold-mining project, which has never been allowed to go forward. Although OceanaGold did not respond to a request for comment for this story, last year the company noted that it would continue with the arbitration case while also seeking “a negotiated resolution to the … permitting impasse”.

For its part, the Salvadoran government says it has halted the permitting process not only over environmental and health concerns but also over procedural matters. While these include Pacific Rim’s failure to abide by certain reporting requirements, the company also appears not to have gained important local approvals.

Under Salvadoran law, an extractive company needs to gain titles, or local permission, for any lands it wants to develop. Yet Pacific Rim had such access to just 13 percent of the lands covered by its proposal, according to Oxfam America, a humanitarian and advocacy group.

Given this lack of community support in a country with recent history of civil unrest, some warn that an ICSID decision in OceanaGold’s favour could result in violence.

“This mining project was re-opening a lot of the wounds that existed during the civil war, and telling a country that they have to provoke a civil conflict in order to satisfy investors is very troublesome,” Luke Danielson, a researcher and academic who studies social conflict around natural resource development, told IPS.

“The tribunal system exists to allow two interests to express themselves – the national government and the investor. But neither of these speak for communities, and that’s a fundamental problem.”

Wary of litigation

Bilateral and regional investment treaties such as DR-CAFTA have seen massive expansion in recent years. And increasingly, many of these include so-called “investor-state” resolution clauses of the type being used in the El Salvador case.

Currently some 2,700 agreements internationally have such clauses, ICSID reports. Meanwhile, although the tribunal has existed since the 1960s, its relevance has increased dramatically in recent years, mirroring the rise in investor-state clauses.

ISCID itself doesn’t decide on how to resolve such disputes. Rather, it offers a framework under which cases are heard by three external arbiters – one appointed by the investor, one by the state and one by both parties.

Yet outside of the World Bank headquarters on Monday, protesters expressed deep scepticism about the highly opaque ISCID process. Several said that past experience has suggested the tribunal is deeply skewed in favour of investors.

“This is a completely closed-door process, and this has meant that the tribunal can basically do whatever it wants,” Carla Garcia Zendejas director of the People, Land & Resources program at the Center for International Environmental Law, a watchdog group here, told IPS.

“Thus far, we have no examples of cases in which this body responded in favour of communities or reacted to basic human rights violations or basic environmental and social impact.”

Zendejas says the rise in investor-state lawsuits in recent years has resulted in many governments, particularly in developing countries, choosing to acquiesce in the face of corporate demand. Litigation is not only cumbersome but extremely expensive.

“Governments are increasingly wary of being sued, and therefore are more willing to accept and change polices or to ignore their own policies, even if there’s community opposition,” she says.

“Certain projects have seen resistance, but political pressure often depends on who’s in power. Unfortunately, the incorrect view that the only way for development to take place is through foreign investment is still very engrained in many of the powers that be.”

While there is no public timeframe for ISCID resolution on the El Salvador case, a decision is expected by the end of the year.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

Stacks of confiscated timber logged illegally in the National Tapajos forest, Brazil. Credit: UN Photo/Eskinder Debebe

By Carey L. Biron
WASHINGTON, Sep 11 2014 (IPS)

At least half of global deforestation is taking place illegally and in support of commercial agriculture, new analysis released Thursday finds – particularly to supply overseas markets.

Over the past decade, a majority of the illegal clearing of forests has been in response to foreign demand for common commodities such as paper, beef, soy and palm oil. Yet governments in major markets such as the United States and European Union are taking almost no steps to urge corporations or consumers to reject such products.“The biggest threat to forests is gradually changing, and that threat is today from commercial agriculture." -- Sam Lawson of Earthsight

Indeed, doing so would be incredibly difficult given the incredibly widespread availability of potentially “dirty” products, the new analysis, published by Forest Trends, a Washington-based watchdog group, suggests. In many countries, consumers are likely using such products on a regular basis.

“In the average supermarket today, the majority of products are at risk of containing commodities that come from illegally deforested lands,” Sam Lawson, the report’s author and director of Earthsight, a British group that investigates environmental crime, told IPS.

“That’s true for any product encased in paper or cardboard, any beef, and any chicken or pork given that these [latter] animals are often raised on soy. And, of course, palm oil is now in almost everything, from lipstick to ice cream.”

In the absence of legislation to prevent such products from being imported and sold, Lawson says, “There’s always this risk.”

Overall, some 40 percent of all globally traded palm oil and 14 percent of all beef likely comes from illegally cleared lands, the paper estimates. The same can be said of a fifth of all soy and a third of all tropical timber, widely used to make paper products.

Meanwhile, some three-quarters of Brazilian soy and Indonesian palm oil are exported. Such trends are growing in countries such as Papua New Guinea and the Democratic Republic of Congo.

While many case studies on these issues have previously been published on particular countries, sectors or companies, the new report is the first to try to extrapolate that data to the global level.

“Consumer demand in overseas markets resulted in the illegal clearance of more than 200,000 square kilometers of tropical forest during the first 12 years of the new millennium,” the report estimates, noting this adds up to “an average of five football fields every minute”.

While much this illegal clearing is being facilitated by corruption and lack of capacity in developing countries, Lawson places the culpability elsewhere.

“It’s companies that are carrying out these acts and they bear ultimate responsibility,” he says. “Big consumer countries also need to stop undermining the efforts of developing countries by allowing these products unfettered access to their markets.

Logging lessons

The ramifications of degraded forestlands, of course, are both local – impacting on livelihoods, ecosystems and human health – and global. Standing, mature forests not only hold massive amounts of carbon but also continually suck carbon dioxide out of the atmosphere.

Between 2000 and 2012, the emissions associated with illegal deforestation for commercial agriculture each year was roughly the same as a quarter of the annual fossil fuel emissions in the European Union.

The new findings come just ahead of two major global climate summits. Later this month, U.N. Secretary-General Ban Ki-moon will host international leaders in New York to discuss the issue, and in December the next round of global climate negotiations will take place in Peru, ahead of intended global agreement next year.

The Lima talks are being referred to as the “forest” round. Some observers have suggested that forestry could offer the most significant potential for global emissions cuts.

This rising global consensus around the importance of maintaining forest cover in the face of global climate change has led to significant international efforts to tackle illegal logging. And these have met with some important success.

Yet Earthsight’s Lawson says that some of the companies that were previously involved in illegally cutting tropical hardwoods are now engaging in the illegal clearing of forests to make way for large-scale agriculture.

“The biggest threat to forests is gradually changing, and that threat is today from commercial agriculture,” he says. “What we need now is to repeat some of the efforts that have been made in relation to illegal logging and apply those to agricultural commodities.”

The European Union, for instance, is currently in the process of implementing a bilateral system of licensing, in order to allow for legally harvested timber to be traced back to its source. Similar bilateral arrangements, Lawson suggests, could be introduced around key commodities.

Proven legality

Such a process would charge governments and multinational companies with ensuring that globally traded commodities do not originate from illegally cleared forestlands. In essence, this would create a situation in which the base requirement for entry into major markets would be proven legality.

Today, of course, the choice of whether or not to purchase a product made with ingredients potentially sourced from illegally deforested lands is up to the consumer – if that information is available at all. Yet such a new arrangement would turn that responsibility around entirely.

“All of this onus on the consumer bothers me – it really shouldn’t have to be so difficult to make these choices,” Danielle Nierenberg, the president of Food Tank, a Washington think tank focused on sustainability issues, told IPS.

“The fact is, consumers are still blind to these issues – despite the growth of the local food movement in Western countries, there remains significant demand for a range of inexpensive products. That’s why the real action has to come from the corporate side, and governments need to take a bigger interest.”

The United States has landmark legislation in place that bans the use of illegally sourced wood products in the country. By many accounts, that legal regime has been notably effective in cutting off the country’s massive market to those products.

Yet for now, Nierenberg says that there is no political appetite in Washington to do something similar regarding agricultural commodities.

“Instead, the real opportunity for government initiative comes from the developing world,” she says. “They need to invest more in small- and medium-scale farmers, protect their lands from land grabs, and invest in simple agricultural technologies that actually work. That’s where the real change could happen.”

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

As one of the Ebola epicentres, the district of Kailahun, in eastern Sierra Leone bordering Guinea, was put under quarantine at the beginning of August. Credit: ©EC/ECHO/Cyprien Fabre

By Carey L. Biron
WASHINGTON, Sep 8 2014 (IPS)

The U.S. military over the weekend formally began to support the international response to the Ebola outbreak in West Africa.

Advocates of the move, including prominent voices in global health, are lauding the Pentagon’s particularly robust logistical capacities, which nearly all observers say are desperately needed as the epidemic expands at an increasing rate.On Monday, the United Nations warned of an “exponential increase” in cases in coming weeks.

Yet already multiple concerns have arisen over the scope of the mission – including whether it is strong enough at the outset as well as whether it could become too broad in future.

President Barack Obama made the first public announcement on the issue on Sunday, contextualising the outbreak as a danger to U.S. national security.

“We’re going to have to get U.S. military assets just to set up, for example, isolation units and equipment there to provide security for public health workers surging from around the world,” the president said during a televised interview. “If we don’t make that effort now … it could be a serious danger to the United States.”

While the United States has spent more than 20 million dollars in West Africa this year to combat the disease, Washington has come under increased criticism in recent months for not doing enough. Obama is now expected to request additional funding from Congress later this month.

The military’s response, however, has already begun – albeit apparently on a very small scale for now, and in just a single Ebola-hit country.

A Defence Department spokesperson told IPS that, over the weekend, Secretary of Defence Chuck Hagel approved the deployment of a “25-bed deployable hospital facility, equipment, and the support necessary to establish the facility” in Liberia. For now, this is the extent of the approved response.

The spokesperson was quick to note that additional planning is underway, but emphasised that the Pentagon is responding only to requests made by other federal agencies and taking no lead role. Further, its commitment to the hospital in Liberia, the country most affected by the outbreak, is limited.

The Department of Defence “will not have a permanent presence at the facility and will not provide direct patient care, but will ensure that supplies are maintained at the hospital and provide periodic support required to keep the hospital facility functioning for up to 180 days,” the spokesperson said.

“This approach provides for the establishment of the hospital facility in the shortest possible period of time … Once the deployable hospital facility is established, it will be transferred to the Government of Liberia.”

On Monday, Liberia’s defence minister, Brownie Samukai, said his government was “extremely pleased” by the announcement.

“We had discussions at the Department of Defence on the issues of utilising and requesting the full skill of United States capabilities, both on the soft side and on the side of providing logistics and technical expertise,” Samukai, who is currently here in Washington, told the media. “We look forward to that cooperation as expeditiously as we can.”

No security needed

The current Ebola outbreak has now killed some 2,100 people and infected more than 3,500 in five countries. On Monday, the United Nations warned of an “exponential increase” in cases in coming weeks.

Yet thus far the epidemic has resulted in an international response that is almost universally seen as dangerously inadequate. Obama’s statement Sunday nonetheless raised questions even among those supportive of the announcement.

Medecins Sans Frontieres (MSF), the French humanitarian group, remains the single most important international organisation in physically responding to the outbreak. While MSF has long opposed the use of military personnel in response to disease outbreaks, last week it broke with that tradition.

Warning that the global community is “failing” to address the epidemic, the group told a special U.N. briefing that countries with “civilian and military medical capability … must immediately dispatch assets and personnel to West Africa”.

Yet while MSF has welcomed Obama’s announcement, the group is also expressing strong concerns over the president’s reference to the U.S. military providing “security for public health workers”.

MSF “reiterates the need for this support to be of medical nature only,” Tim Shenk, a press officer with the group, told IPS. “Aid workers do not need additional security support in the affected region.”

Last week, MSF urged that any military personnel deployed to West Africa not be used for “quarantine, containment or crowd control measures”.

The Defence Department spokesperson told IPS that the U.S. military had not yet received a request to provide security for health workers.

Few guidelines

The United States is not the only country now turning to its military to bolster the flagging humanitarian response in West Africa.

The British government in recent days announced even more significant plans, aiming to set up 68 beds for Ebola patients at a centre, in Sierra Leone, that will be jointly operated by humanitarians and military personnel. The Canadian government had reportedly been contemplating a military plan as well, although this now appears to have been shelved.

Yet the concerns expressed by MSF over how the military deployment should go forward underscore the fact that there exists little formal guidance on the involvement of foreign military personnel in international health-related response.

The World Health Organisation (WHO), for instance, has no broad stance on the issue, a spokesperson told IPS. As the WHO is an intergovernmental agency, it is up to affected countries to make related decisions and request.

“Each country handles its own security situation,” Daniel Epstein, a WHO spokesperson, told IPS. “So if governments agree to military involvement from other countries, that’s their business.”

Another spokesperson with the agency, Margaret Harris, told IPS that the WHO appreciates “the skills that well-trained, disciplined and highly organised groups like the US military can bring to the campaign to end Ebola.”

Yet there is already concern that the U.S. military response could be shaping up to be far less robust than necessary.

MSF’s Shenk noted that any plan from the U.S. military would need to include both the construction and operation of Ebola centres. Thus far, the Pentagon says it will not be doing any operating.

While around 570 Ebola beds are currently available in West Africa, MSF estimates that at least 1,000 hospital spaces, capable of providing full isolation, are needed in the region.

In a series of tweets on Monday, Laurie Garrett, a prominent global health scholar with the Council on Foreign Relations, a Washington think tank, expressed alarm that the Defence Department’s Ebola response was shaping up to be “tiny” in comparison to what is needed.

Edited by Kitty Stapp

The writer can be reached at cbiron@ips.org

New analysis suggests that developing countries are losing a trillion dollars or more each year to tax evasion and corruption facilitated by lax laws in Western countries, raising pressure on global leaders to agree to broad new reforms at an international summit later this year.

These massive losses could be leading to as many as 3.6 million deaths a year, according to the ONE Campaign, an advocacy group that focuses on poverty alleviation in Africa. Recovering just part of this money in Sub-Saharan Africa, the organisation says, could allow for the education of 10 million more children“Whenever corruption is allowed to thrive, it inhibits private investment, reduces economic growth, increases the cost of doing business, and can lead to political instability. But in developing countries, corruption is a killer” – ONE Campaign
 a year, or provide some 165 million additional vaccines.

“Whenever corruption is allowed to thrive, it inhibits private investment, reduces economic growth, increases the cost of doing business, and can lead to political instability. But in developing countries, corruption is a killer,” a report on the findings, released Wednesday, states.

“When governments are deprived of their own resources to invest in health care, food security or essential infrastructure, it costs lives, and the biggest toll is on children.”

The new analysis focuses on a spectrum of money laundering, bribery and tax evasion by criminals as well as government officials. The lost money is not development aid but rather undeclared or siphoned-off business earnings – immense tax avoidance resulting in a decreased base from which governments can fund essential services.

International trade offers a key point of manipulation, the report says, with the extractive industries particularly vulnerable. In Africa alone, exports of natural resources grew by a factor of five in the decade leading up to 2012, offering clear prospects for growth alongside lucrative opportunities for corruption on a mass scale.

“Between 2002 and 2011 we saw an exponential increase in illicit financial flows across the globe,” Joseph Kraus, a transparency expert at the ONE Campaign, told IPS.

“Yet while we’re all familiar with corruption in developing countries, it takes two to tango – that money often ends up in the financial centres of the Global North. Those banks, lawyers and accountants are all essentially facilitators of that corruption, so in order to get at the root of this issue we need to go after the problems there.”

Real opportunity

Advocates including the ONE Campaign are currently stepping up pressure on industrialised countries to institute a series of across-the-board transparency measures. Some are aimed at corruption in developing countries, such as strengthening disclosure laws impacting on the extractives industry and bolstering “open data” standards to allow citizens increased oversight over their governments’ dealings.

Several other reforms would need to be carried out by developed countries, particularly those housing major financial centres such as the United States and United Kingdom. These would include new standards requiring governments to automatically exchange tax information, to mandate the publication of full information on corporate ownership, and to force multinational corporations to report on their earnings on a country-by-country basis.

In certain circles, such demands have been percolating for years. But current circumstances could offer unusual opportunity for such changes.

“In the last two years we’ve seen an acceleration of this agenda,” Kraus says. “Eighteen months ago, no one was talking about phantom firms or anonymous shell companies. But these issues have gained a lot of momentum in a short period of time, and there is real opportunity coming up.”

This new energy has been motivated particularly by concerns in advanced economies over shrinking government budgets in the aftermath of the global economic downturn. Yet developing countries arguably stand to benefit the most from substantive reforms, provided they’re structured accordingly.

Advocates of such changes are now looking ahead to a summit, on Nov 15 and 16 in Australia, of the members of the Group of 20 (G20) world’s largest advanced and emerging economies as well as two major meetings of finance ministers in the run-up to that event.

The G20 represent about two-thirds of the world’s population, 85 percent of global gross domestic product and over 75 percent of global trade.

The members of the G20 are 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.

The G20 has taken on a primary role in issues of global financial stability and, more recently, in pushing the automatic exchange of tax information between governments. A new global standard on such exchange could be approved by the G20 ministers in November, among other actions.

“For too long, G20 countries have turned a blind eye to massive financial outflows from developing countries which are channelled through offshore bank accounts and secret companies,” according to John Githongo, an anti-corruption campaigner in Kenya.

“Introducing smart policies could help end this trillion dollar scandal and reap massive benefits for our people at virtually no cost. The G20 should make those changes now.”

Coordinated response

In fact, many G20 countries have instituted some of these reforms on their own. The U.K. government, for instance, has taken unilateral action on publicising information on corporate ownership, while the United States was the first to pass strong transparency requirements for multinational extractives companies.

While such piecemeal national legislation can spur other countries to action, many feel only a comprehensive approach would have a chance at having a substantial impact. Further, many governments have pledged to act on these issues, but have yet to actually follow through.

“Illicit financial flows are a perfect example of a transnational problem, in that you have two legal regimes in which loopholes are being exploited,” Josh Simmons, a policy counsel at Global Financial Integrity, a Washington watchdog group that supplied data for the new ONE Campaign report, told IPS.

“So when an international cooperative body is able to identify these loopholes, they can get member countries to move in sync to address the situation. But if only one country tries to do so, businesses would probably just move elsewhere.”

Others are looking even more broadly than the G20. A paper released last month by researchers with the Center for Global Development, a think tank here, calls for the inclusion of anti-tax-evasion aims in the new global development goals currently being negotiated under the United Nations.

Indeed, even while there could be real movement at the G20 on several of these issues this year, the work on the other end of this equation – in developing countries – remains onerous.

“We need to get developing countries’ tax systems up to speed, strengthen their financial intelligence units and get their anti-laundering laws up to code. And that is proceeding, but much more under the radar given its complexity,” Simmons says.

“Still, that’s where people are actually bearing the brunt of this problem. Tax avoidance in the United States contributes to the national debt, but in developing countries it’s literally causing people to go hungry.”

Edited by Ronald Joshua

Men line up to receive food distributed by Coalition for the Homeless volunteers at 35th St, FDR Drive, in New York City. Credit: Zafirah Mohamed Zein/IPS

By Carey L. Biron
WASHINGTON, Sep 2 2014 (IPS)

A United Nations panel reviewing the U.S. record on racial discrimination has expressed unusually pointed concern over a new pattern of laws it warns is criminalising homelessness.

U.S. homelessness has increased substantially in the aftermath of the financial downturn, and with a disproportionate impact on minorities. Yet in many places officials have responded by cracking down on activities such as sleeping or even eating in public, while simultaneously defunding social services.

The new rebuke comes from a panel of experts reviewing the United States’ progress in implementing its obligations under a treaty known as the International Convention on the Elimination of All Forms of Racial Discrimination, commonly referred to as CERD or the race convention.

“The Committee is concerned at the high number of homeless persons, who are disproportionately from racial and ethnic minorities,” the CERD panel stated in a formal report released on Friday, “and at the criminalization of homelessness through laws that prohibit activities such as loitering, camping, begging, and lying in public spaces.”

This was only the second time that the United States’ record on race relations and discriminatory practices, and particularly the federal government’s actions in this regard, have been formally examined against the measuring stick of international law.

The panel not only called on the U.S. government to “abolish” laws and policies that facilitate the criminalisation of homelessness, but also to create incentives that would push authorities to focus on and bolster alternative policy approaches.

The CERD findings were actually the second time this year that new U.S. laws around the criminalisation of homelessness have been criticised at the international level. Similar concerns were expressed by the Human Rights Committee, which warned the cumulative effect was “cruel, inhuman, and degrading”.

“These are human rights experts who have seen human rights abuses all over the globe, but still when they hear about these issues in the United States it boggles their mind,” Eric S. Tars, a senior attorney with the National Law Center on Poverty & Homelessness, told IPS.

The CERD panel underscored these concerns by requesting additional information from the U.S. government before the country’s next such review, in 2017. The other issues so highlighted included racial profiling and gun violence, areas that have typically received far more interest from policymakers and the media.

Questionable progress

The formal review of the United States’ progress on implementing the race convention took place over two days in mid-August, attended by some 30 U.S. officials and dozens of civil society groups. The federal government’s formal report to the committee is available here, while non-government analyses lodged with the commission covering education, housing, gun violence, health care, immigration and other issues, are available here.

Observers say the mere act of the government going before an international body to discuss these issues was important, a sense strengthened by the significant delegation and substantive response offered by the administration of Barack Obama.

“In many ways it undercuts the idea of U.S. exceptionalism – that we don’t have human rights violations here,” Ejim Dike, the executive director of the U.S. Human Rights Network, a leading organiser around the CERD review, told IPS following the CERD discussions.

“In fact we have a lot of human rights violations, and our racial past and unfortunate racial present are indications of these concerns. Sometimes the headlines are so reminiscent of what happened during the 1950s and 1960s that it begs the question of how much progress we actually have made.”

Indeed, some metrics of racial discrimination in the United States are currently worse than they were decades ago. An official summary of the review’s discussions between the U.N. experts and civil society groups noted one committee member’s shock “to realize that in spite of several decades of affirmative action in the United States to improve the mixing up of colors and races in schools … segregation was nowadays much worse than it was in the 1970s.”

Likewise, recent years have underscored the significant racial disparities that continue to characterise homelessness in the United States, a discrepancy noted by the U.N. panel. This pattern has continued and has even been strengthened in the aftermath of the 2007-2008 financial crisis.

In 2010, for instance, African-Americans were seven times more likely to need emergency housing than whites, according to statistics from the Institute for Children, Poverty and Homelessness, a research organisation. Similar discrepancies can be seen in the case of Hispanics and other minority groups.

This is important because, unlike U.S. domestic law, the race convention prohibits policies that have the effect of being discriminatory, regardless of whether or not they are meant to discriminate.

Banning sleeping, eating

As important as this continued racial pattern is how officials are responding to the new surge in homelessness. Even as the financial downturn in recent years has simultaneously squeezed state budgets and led more people to lose their jobs and homes, the official response has been to strengthen enforcement – to make homelessness more difficult.

Over the past three years, for instance, the number of U.S. cities that have banned sleeping in cars has grown by 119 percent, according to findings released in July. Bans on sleeping or camping in public have likewise risen by 60 percent during that same time.

“These numbers in general are going up and in some cases going up significantly,” the National Law Center’s Tars says. “The only cases in which those numbers are going down is where some cities have removed ordinances banning panhandling and sleeping in certain areas, and instead replaced them with bans that cover the whole city.”

Meanwhile, the financial recession has increased poverty in places where such problems hadn’t previously been visible, in suburban and rural communities. Social services were likely already weak in these areas, and the economy’s broader troubles have led authorities to slash these budgets even further.
“First the communities and governments are cutting resources for homeless shelters and related organisations and saying this isn’t the government’s responsibility. But then some are even making it difficult for charities to deal with the issue – for instance, by punishing people for eating donated food in public,” Tars says.

“In fact, there’s significant evidence that criminalisation is often more expensive and less effective than providing affordable housing.”

Nonetheless, the new focus on austerity budgets in other countries, particularly in the European Union, is seeing governments across the globe increasingly turn to this U.S. model of criminalisation. In June, an Australian researcher noted a new “proliferation” of enforcement-based homelessness laws and policies internationally.

Edited by Stephanie Wildes

Fishermen's boats on the Mekong River in northern Laos. There are already 30 existing dams along the river, and an additional 134 hydropower projects are planned for the lower Mekong. Credit: Irwin Loy/IPS

By Carey L. Biron
WASHINGTON, Aug 29 2014 (IPS)

Large-scale dams are likely having a detrimental impact on water quality and biodiversity around the world, according to a new study that tracks and correlates data from thousands of projects.

Focusing on the 50 most substantial river basins, researchers with International Rivers, a watchdog group, compiled and compared available data from some 6,000 of the world’s estimated 50,000 large dams. Eighty percent of the time, they found, the presence of large dams, typically those over 15 metres high, came along with findings of poor water quality, including high levels of mercury and trapped sedimentation.“The evidence we’ve compiled of planetary-scale impacts from river change is strong enough to warrant a major international focus on understanding the thresholds for river change in the world’s major basins." -- Jason Rainey

While the investigators are careful to note that the correlations do not necessarily indicate causal relationships, the say the data suggest a clear, global pattern. They are now calling for an intergovernmental panel of experts tasked with coming up with a systemic method by which to assess and monitor the health of the world’s river basins.

“[R]iver fragmentation due to decades of dam-building is highly correlated with poor water quality and low biodiversity,” International Rivers said Tuesday in unveiling the State of the World’s Rivers, an online database detailing the findings. “Many of the world’s great river basins have been dammed to the point of serious decline.”

The group points to the Tigris-Euphrates basin, today home to 39 dams and one of the systems that has been most “fragmented” as a result. The effect appears to have been a vast decrease in the region’s traditional marshes, including the salt-tolerant flora that helped sustain the coastal areas, as well as a drop in soil fertility.

The State of the World project tracks the spread of dam-building alongside data on biodiversity and water-quality metrics in the river basins affected. While the project is using only previously published data, organisers say the effort is the first time that these disparate data sets have been overlaid in order to find broader trends.

“By and large most governments, particularly in the developing world, do not have the capacity to track this type of data, so in that sense they’re flying blind in setting policy around dam construction,” Zachary Hurwitz, the project’s coordinator, told IPS.

“We can do a much better job at observing [dam-affected] resettled populations, but most governments don’t have the capacity to do continuous biodiversity monitoring. Yet from our perspective, those data are what you really need in order to have a conversation around energy planning.”

Dam-building boom

Today, four of the five most fragmented river systems are in South and East Asia, according to the new data. But four others in the top 10 are in Europe and North America, home to some of the most extensive dam systems, especially the United States.

For all the debate in development circles in recent years about dam-building in developing countries, the new data suggests that two of the world’s poorest continents, Africa and South America, remain relatively less affected by large-scale damming than other parts of the world.

Of course, both Africa and South America have enormous hydropower potential and increasingly problematic power crunches, and many of the countries in these continents are moving quickly to capitalise on their river energy.

According to estimates from International Rivers, Brazil alone is currently planning to build more than 650 dams of all sizes. The country is also home to some of the highest numbers of species that would be threatened by such moves.

Not only are Brazil, China and India busy building dams at home, but companies from these countries are also increasingly selling such services to other developing countries.

“Precisely those basins that are least fragmented are currently being targeted for a great expansion of dam-building,” Hurwitz says. “But if we look at the experience and data from areas of high historical dam-building – the Mississippi basin the United States, the Danube basin in Europe – those worrying trends are likely to be repeated in the least-fragmented basins if this proliferation of dam-building continues.”

Advocates are expressing particularly concern over the confluence of the new strengthened focus on dam-building and the potential impact of climate change on freshwater biodiversity. International Rivers is calling for an intergovernmental panel to assess the state of the world’s river basins, aimed at developing metrics for systemic assessment and best practices for river preservation.

“The evidence we’ve compiled of planetary-scale impacts from river change is strong enough to warrant a major international focus on understanding the thresholds for river change in the world’s major basins, and for the planet as a whole system,” Jason Rainey, the group’s executive director, said in a statement.

Economic burden

Particularly for increasingly energy-starved developing countries, concerns around large-scale dam-building go beyond environmental or even social considerations.

Energy access remains a central consideration in any set of development metrics, and lack of energy is an inherent drag on issues as disparate as education and industry. Further, concerns around climate change have re-energised what had been flagging interest in large dam projects, epitomised by last year’s decision by the World Bank to refocus on such projects.

Yet there remains fervent debate around whether this is the best way to go, particularly for developing countries. Large dams typically cost several billion dollars and require extensive planning to complete, and in the past these plans have been blamed for overwhelming fragile economies.

A new touchstone in this debate came out earlier this year, in a widely cited study from researchers at Oxford University. Looking at nearly 250 large dams dating back as far as the 1920s, they found pervasive cost and time overruns.

“We find overwhelming evidence that budgets are systematically biased below actual costs of large hydropower dams,” the authors wrote in the paper’s abstract.

“The outside view suggests that in most countries large hydropower dams will be too costly … and take too long to build to deliver a positive risk-adjusted return unless suitable risk management measures … can be affordably provided.”

Instead, the researchers encouraged policymakers in developing countries to focus on “agile energy alternatives” that can be built more quickly.

On the other side of this debate, the findings were attacked by the International Commission on Large Dams, a Paris-based NGO, for focusing on an unrepresentative set of extremely large dams. The group’s president, Adama Nombre, also questioned the climate impact of the researchers’ preferred alternative options.

“What would be those alternatives?” Nombre asked. “Fossil fuel plants consuming coal or gas. Without explicitly saying it, the authors use a purely financial reasoning to bring us toward a carbon-emitting electric system.”

Edited by: Kitty Stapp

The writer can be reached at cbiron@ips.org

Workers arrive early in the morning at the One World Apparel factory in Port-au-Prince to assemble garments for export from Haiti. Credit: Ansel Herz/IPS

By Carey L. Biron
WASHINGTON, Aug 26 2014 (IPS)

Civil society groups from several continents are stepping up a campaign urging the World Bank to strengthen a series of changes currently being made to a major annual report on countries’ business-friendliness.

The World Bank is in the final stages of a years-long update to its Doing Business report, one of the Washington-based development institution’s most influential analyses yet one that has also become increasingly controversial. Critics now say the first round of changes, slated to go into effect in October, don’t go far enough."It’s a public relations exercise but with reasonably solid metrics behind it, and it’s the joining of these two things that makes Doing Business valuable in the policy world.” -- Scott Morris of the Center for Global Development

On Monday, a coalition of 18 development groups, watchdog organisations and trade unions called on the World Bank Group to take “urgent action” to implement “significant changes” to the Doing Business reforms. In particular, they are asking the bank to adhere more closely to detailed recommendations made last year by a bank-commissioned external review panel chaired by Trevor Manuel, a former planning and finance minister for South Africa.

“It looks like the flaws found by the Independent Panel chaired by Trevor Manuel will be ignored and its recommendations are nowhere close to being implemented,” Aldo Caliari, director of the Rethinking Bretton Woods Project at the Center of Concern, a Catholic think tank here, told IPS. “This is in spite of a wide chorus of civil society organisations and shareholders that supported them.”

While the World Bank’s mission is to fight global poverty, Caliari and others dispute whether the Doing Business report’s metrics are pertinent to poor communities. Others say they can be outright detrimental.

Both civil society investigations and the Manuel commission have suggested “how little relevance the areas and indicators have to the reforms that matter to small and medium companies in developing countries,” Caliari says. “They seem far more oriented to support operations of large transnationals in those countries.”

Such concerns stem from the outsized influence that the Doing Business report has built up, particularly in the developing world, since it was introduced in 2003. Reportedly, the report is used by some 85 percent of global policymakers.

The core of the report remains a simple aggregated ranking of countries, known as the Ease of Doing Business index. While based on a complex series of business-friendliness metrics, the high profile of the index results has inevitably led governments to compete among one another to raise their country’s ranking and, hopefully, strengthen foreign investment.

Yet a direct effect of this competition, critics say, is governments being pushed to adhere to a uniform set of policy recommendations. These include lowering taxes and wages and weakening overall industry regulation, thus potentially endangering the poor.

“[T]he report’s role is to inform policy, not to outline a normative position, which the rankings do,” the 18 groups wrote to World Bank Group President Jim Kim at the end of July. “Doing Business needs to become better aligned with moves towards greater country-owned and led development and an appreciation of the importance of a country’s circumstances, stage of development and political choices.”

In its report last June, the Manuel commission likewise urged the bank to drop the ranking system entirely, noting that this constituted “the most important decision the Bank faces with regard to the Doing Business report.”

Maintained but reformed

In response, the bank is reforming the methodology behind its ranking calculations. In part, this includes broadening its analysis to use data from two cities in most countries, rather than just one.

More broadly, the new calculations will constitute an effort simultaneously to continue to offer a relative score for each country but also to decrease the importance of the specific ranking.

“This approach will provide users with additional information by showing the relative distances between economies in the ranking tables,” an announcement on the changes stated in April. (The bank was unable to provide additional comment by this story’s deadline.)

“By highlighting where economies’ scores are close, the new approach will reduce the importance of difference in rankings,” the announcement continues. “And by revealing where distances between scores are relatively greater, it will give credit to governments that are reforming but not yet seeing changes in rankings.”

Some development scholars have pushed against the Manuel commission’s recommendations on the index, defending the need for the bank to maintain its aggregate rankings in some form.

“The Doing Business report isn’t a research exercise – it’s a policymaking tool. Because of the rankings it has a unique value, particularly for those countries that have a long way to go on economic reform,” Scott Morris, a senior associate at the Center for Global Development, a think tank here, told IPS after the Manuel commission’s report was published.

“Internally, it gives government officials something simple and targeted to latch onto, much more than a 500-page report would do. It’s a public relations exercise but with reasonably solid metrics behind it, and it’s the joining of these two things that makes Doing Business valuable in the policy world.”

Decent jobs created?

Yet others warn that the rankings themselves continue to be problematic, even in their new form.

The reforms are “not satisfactory, as the rankings will continue to influence the policy agenda of many developing countries despite their methodological flaws,” Tiago Stichelmans, a policy and networking analyst at the European Network on Debt and Development, told IPS in an e-mail.

“The problem of the rankings is the fact that they are based on regulatory measures in a single city (which is due to become two cities) for every country and are therefore irrelevant to many communities. The rankings also have a bias in favour of deregulatory measures that have limited impact on development.”

Of course, many would support the idea of tracking country-by-country policies aimed at encouraging industry to help bolster development metrics. But Stichelmans says this would require major changes, including a move away from the report’s current focus on reforms to the business environment.

“A shift from promoting low tax rates and labour deregulation to taxes paid, decent jobs created and [small and medium enterprises] supported would be a step in the right direction,” he says.

Ideas from NGOs have included indicators on corruption and human rights due diligence, Stichelmans continues, “but this must be accompanied by a drastic overhaul.”

For now, some of the newly announced changes are expected to be incorporated into the Doing Business report for 2015, slated to be released in late October. Other reforms, including some yet to be announced, will be introduced in future reports.

Edited by: Kitty Stapp

The writer can be reached at cbiron@ips.org

The U.S. and Brazilian governments are moving into the final stages of weighing approval for the commercialisation of genetically engineered eucalyptus trees, moves that would mark the first such permits anywhere in the world.

The Brazilian government is slated to start taking public comments on such a proposal during the first week of September. Similarly, U.S. regulators have been working on an environmental impact assessment since early last year, a highly anticipated draft of which is expected to be released any day.

Technician Christine Berry checks on futuristic peach and apple “orchards”. Each dish holds tiny experimental trees grown from lab-cultured cells to which researchers have given new genes. Credit: USDA Agricultural Research Service

Despite industry claims to the contrary, critics warn that the use of genetically engineered (GE) trees would increase deforestation. The approvals could also spark off a new era of such products, which wouldn’t be confined solely to these countries.

“If Brazil and the United States get permission to commercialise these trees, there is nothing to say that they wouldn’t just export these products to other countries to grow,” Anne Petermann, the executive director of the Global Justice Ecology Project (GJEP) and the coordinator of the Campaign to Stop GE Trees, a network that Wednesday announced a new global initiative, told IPS.

“These GE trees would grow faster and be more economically valuable, so it’s easy to see how current conventional plantations would be converted to GE plantations – in many parts of Africa, Latin America and Asia. Further, both Europe and the U.S. are currently looking at other genetically engineered trees that bring with them a whole additional range of potential impacts.”

While the United States has thus far approved the use of two genetically modified fruit trees, the eucalyptus is the first GE forest tree to near release. Similar policy discussions are currently taking place in the European Union, Australia and elsewhere, while China has already approved and is using multiple GE trees.

The plantation approach

The eucalyptus is a particularly lucrative tree, currently the most widely planted hardwood in the world and used especially to produce pulp for paper and paper products.

In the United States, the trees would also likely be used to feed growing global demand for biofuels, particularly in the form of wood pellets. In 2012 alone, U.S. exports of wood pellets increased by some 70 percent, and the United States is today the world’s largest such producer.

U.S. regulators are currently looking at two types of eucalyptus that have been genetically engineered to withstand frosts and certain antibiotics, thus allowing for plantations to be planted much farther north. The company requesting the approval, ArborGen, says the introduction of its GE seedlings would quadruple the eucalyptus’s range in the United States alone.

ArborGen has estimated that its sales could see 20-fold growth, to some 500 million dollars a year by 2017, if GE trees receive U.S. approval, according to a comprehensive report published last year by the Washington-based Center for Food Safety. Likewise, Brazilian analysts have suggested that the market for eucalyptus products could expand by some 500 percent over the coming two decades.

Yet the eucalyptus, which has been grown in conventional plantations for years, has been widely shown to be particularly problematic – even dangerous – in monoculture.

The eucalyptus takes unusually high levels of water to grow, for instance, and is notably invasive. The trees are also a notorious fire hazard; during a devastating fire in the U.S. state of California in the 1990s, nearly three-quarters of the blaze’s energy was estimated to come from highly combustible eucalyptus trees.

In addition, many are worried that approval of the GE proposals in the United States and Brazil would, inevitably, act as a significant boost to the monoculture plantation model of production.

“This model has been shown to be very negative for local communities and nature, expelling and restricting the access of people to their territories, depleting and contaminating water sources – especially in the Global South,” Winifridus Overbeek, coordinator of the World Rainforest Movement, a global pressure group, told IPS from Uruguay.

“Many of these plantations in Brazil have hindered much-needed agrarian land reform under which hungry people could finally produce food on their own lands. But under the plantation model, most of the wood produced is destined for export, to attend to the ever-increasing paper demand elsewhere.”

Overbeek says Brazilian peasants complain that “No one can eat eucalyptus.”

More wood, more land

Despite the rise of digital media over the past decade, the global paper industry remains a behemoth, responding to demand for a million tonnes of paper and related products every day. That amounted to some 400 million tonnes of paper used in 2010, according to the World Wildlife Fund, and could increase to 500 million tonnes per year by the end of the decade.

A key argument from ArborGen and others in favour of genetically engineered trees, and the plantation system more generally, is that increased use of “farmed” trees would reduce pressure on native forests. Indeed, ArborGen’s motto is “More Wood. Less Land”.

Yet as the world has increasingly adopted the plantation approach, the impact has been clear. Indonesia, for instance, has allowed for the clear-cutting of more than half of its forests over the past half-century, driven particularly by the growth of palm plantations.

According to U.N. data, plantations worldwide doubled their average wood production during the two decades leading up to 2010.  But the size of those plantations also increased by some 60 percent.

“While it sounds nice and helpful to create faster-growing trees, in reality the opposite is true. As you make these things more valuable, more land gets taken over for them,” GJEP’s Petermann says.

“Especially in Brazil, for instance, because we’ve seen an intensification of wood coming from each hectare of land, more and more land is being converted.”

In June, more than 120 environmental groups from across the globe offered a vision on comprehensive sustainability reforms across the paper sector, traditionally a key driver of deforestation. That document, the Global Paper Vision, encourages users and producers to “refuse fibre from genetically modified organisms”.

“Theoretically, arguments on the benefits of GE trees could be true, motivated by increasing competition for wood resources,” Joshua Martin, the director of the Environmental Paper Network (EPN), a U.S.-based umbrella group that spearheaded the vision document, told IPS.

“But ultimately this is an attempt to find a technological solution – and, we feel, a false solution given the dangers, both known and unknown, around this experimental use. Instead, we advocate for conservation and reducing consumption as logical first steps before manipulating nature and putting natural systems at risk of contamination.”

Edited by: Kitty Stapp

The writer can be reached at cbiron@ips.org