globalization


Secretary Clinton is visiting seven countries in Africa this week, Kenya, South Africa, Angola, the Democratic Republic of the Congo, Nigeria, Liberia, and Cape Verde. She is visiting to secure safe profits from Africa for American corporations. She began her trip by addressing an AGOA conference in Kenya.

Waiting for work in the EPZ

Waiting for work in the EPZ

Tuendelee Mbele EPZ Workers Welfare is a registered self-help organization founded in 2004 by workers in Kenya’s Export Processing Zones (EPZ).  EPZs have been set up around the world to provide cheap labour to corporations. In Kenya’s zones, as in those of other countries, national labour standards are not enforced. In Kenya companies get a 10 year tax holiday, exemption from import/export tariffs and no restriction on foreign investment and ownership. When Kenya allowed EPZs in the textile industry, the home-grown textile industry collapsed and workers were forced to take jobs in the zone where conditions are horrendous: harder work, less pay, brutal quota systems, no sick care, no sick leave, no maternity leave, extensive sexual harassment. Workers know what time they begin in the morning, but not what time they end.
Pamoja Tunaweza, a registered Kenyan CBO (non-profit), is currently delivering an outreach project with a focus on workers, women and teens. EPZs have been set up around the world to provide cheap labour to corporations. In Kenya’s zones, as in those of other countries, national labour standards are not enforced. In Kenya companies get a 10 year tax holiday, exemption from import/export tariffs and no restriction on foreign investment and ownership. When Kenya allowed EPZs in the textile industry, the home-grown textile industry collapsed and workers were forced to take jobs in the zone where conditions are horrendous: harder work, less pay, brutal quota systems, no sick care, no sick leave, no maternity leave, extensive sexual harassment. Workers know what time they begin in the morning, but not what time they end. Photos by Phil Vernon

AGOA is an act of the US Congress passed to benefit the US. It is not a treaty or an international agreement. In Kenya Steve Ouma Akoth writes that there are a number of subjects which are taboo in discussion of AGOA both for the US and for the countries supposedly benefitting from AGOA. He describes three of these taboo subjects.

PRECARIOUS AND POVERTY JOBS
NATIONAL LABOUR LAWS AND PRACTICE
TRADE POLICIES OF THE US GOVERNMENT AND PURCHASING PRACTICES

Of the first, precarious and poverty jobs, he writes:

… for the first time after the industrial revolution, such huge numbers of unorganised labourers, especially women, are coming under the productive sway of large-scale capital.

Although the zones boast of creating 30,000 jobs, mostly for women, many of the women workers interviewed feel that their jobs are failing to help them and their families work their way out of poverty. So they are struggling and campaigning to turn their jobs into the potential they promise – to be a path for poverty reduction for themselves, their households and their communities.

Of national labour laws:

… there has been enormous pressure on the government of Kenya to trade away workers’ rights, in law and in practice, for a place in the global economy.

Pressure has also been coming from the International Monetary Fund (IMF) and World Bank. The two institutions, which were major sponsors of the EPZs, have advised the government of Kenya to adjust their labour laws to meet sourcing companies’ demands. This conveys an unspoken message: Labour standards should be defined not by governments, but by market forces.

This creates horrendous conditions for workers, who among other practices are forced to work extensive unpaid overtime. This is slavery:

Workers are forced to sign-out for official records and then remain locked in factories to meet the ‘targets’.

And of US trade and purchasing practices:

The third taboo subject relates to trade policies of the US government and their corporate courtiers who are the sourcing companies from Kenya’s EPZs. Take textiles for instance. Under AGOA, Kenya is expected to attain sustained and competitive domestic production of cotton by 2012. 2012 is the sunset date for the exception under the rule of third party origin. Thus for Kenya to continue exporting apparel products to the US, the cotton used from 2012 must originate from Kenya. The idea of producing cotton domestically is a good one. But this assumes that all cotton producing countries or those with the potential for production like Kenya are collectively governed by the World Trade Organization (WTO) rules. This aspiration is silent on America’s trade-distorting domestic subsidies which amount to about US$3.8 billion or 80-90 per cent of total US support for cotton. Domestic subsidies also make up almost all of the European cotton subsidies. The over-subsidy of cotton by the US (held at ransom by big corporations and its domestic farm barons) has been a taboo topic not only in AGOA but also within the WTO circles. During the WTO meeting in 2005, the African Ministers had demanded that 80 per cent of domestic subsidies for cotton be eliminated by the end of 2006, and the rest within a few years. There has been no move on this subject. It is a taboo subject that received not even a mention from the US President Obama during his most recent trip to Ghana.

Phil Vernon of SOLID and Pamoja Tunaweza, reports regarding the Kenyan EPZs:

When Kenya allowed EPZs in the textile industry, the home-grown textile industry collapsed and workers were forced to take jobs in the zone where conditions are horrendous: harder work, less pay, brutal quota systems, no sick care, no sick leave, no maternity leave, extensive sexual harassment. Workers know what time they begin in the morning, but not what time they end.

If you scroll down the Pamoja Tunaweza page, you will find a slide show of pictures revealing more about working and living conditions with the EPZs.

Steve Ouma Akoth tells us the attitude towards labour of US corporations operating in Kenya, and in other countries under AGOA is simple:

Make it flexible and make it cheap. …
The companies’ toolkit includes hiring more vulnerable workers who are less likely to organise – women, often immigrants into the urban centres – and intimidate or sack those who do try to create trade unions and stand up for their rights.

Firoze Manji writes:

With China, India, Brazil, Saudi Arabia, Russia and other emerging powers competing for access to Africa’s natural resources, including oil, there is little doubt that the US belligerence during the era of the Bush junta has potentially created conditions favourable to the new players. Clinton’s visit is directly related to seeking to protect and advance American corporate interests in oil and natural resource exploitation in Africa.

However, as reported by Reuters: China, others shove US in scramble for Africa

A presidential visit followed by U.S. Secretary of State Hillary Clinton’s African tour cannot conceal a stark reality: China has overtaken the United States as Africa’s top trading partner.

Chinese labor practices also involve horrendous slavery conditions. But these are the way China practices business at home. This is capitalism without democracy.

In Sudan China focuses on oil wells, not local needs.

Andrew Small, a China specialist at the German Marshall Fund, a public policy institute, points out that many of Beijing’s worst practices in Africa today stem not from colonialist attitudes, but from China’s own level of development. “Every mining disaster in Zambia, forced resettlement around [Sudan’s] Merowe dam,and corrupt deal with government officials, has its counterpart in[China’s] Dongbei, the Three Gorges dam, Shanghai, and elsewhere,” he points out.

“There is an attitude among many Chinese that Africa – like Asia decades before – is primed for a developmental take-off … making it a business and investment opportunity rather than just a benighted part of the world that needs to be saved or solely a repository of natural resources,” he says. “[China] will be in the unusual position of being both a superpower and developing country for some time to come, with parts of the Chinese interior having far more in common with Africa than with the West.”

True, perhaps, but the colonial comparison itself is meaningless, says Robert Rotberg … the Chinese are stripping thecontinent of raw material as fast as they can and are fairly ruthless about bringing their own laborers for projects and ignoring locals.

And more from Firoze Manji regarding the breathtaking arrogance of the US Africa Command:

And that brings us to the third dimension. This visit is also about negotiating for AFRICOM to have greater presence in Africa. It is hardly a coincidence that just as Clinton begins her junket, so AFRICOM announces its MEDFLAG initiative in Swaziland.

‘African Command’ does not mean Africans in command, just as the African Growth and Opportunity Act is not about growth and opportunity for Africa, but rather for US corporations. Security is high on the agenda. But it is the security of US corporate interests that is at the heart of Clinton’s agenda, not human security, the security of ordinary people to thrive, to be secure that their children will be safe from impoverishment, secure in the knowledge that they will be able to work; and working, to transform their world to serve the interests of humanity, not the narrow interests of a minority in the North.

There is no democracy in the institution of the Africa Command, as there is no democracy in the trade practices described above facilitated by AGOA. America’s advantage is as an example and advocate of democracy and human rights. When the US undermines democracy and human rights, as with the labor practices in the EPZs, it undermines its own advantage in Africa. Although Bush did enormous damage to the US brand, it may be possible to recover, but only if the US practices some of the democratic and human rights principles it preaches. Being poor does not mean people are blind or stupid. They know when they are being cheated and abused. As Steve Ouma Akoth points out:

People who sell their labour have certain inalienable rights. These rights are premised on the fundamental belief that human beings are entitled to a dignified life. Therefore, working conditions must satisfy the minimum requirements of dignified existence. And this is a fundamental principal in the International Labour Organization (ILO) Conventions. It is on this logic that ILO prohibits any form of slavery, servitude and forced labour. The practices above and sexual harassment that constitute the trademark of EPZs in Kenya are coming under microscopic scrutiny due to the value attached to human dignity.

________

Added September 18, 2009:

I made some updates and corrections above as advised by Phil Vernon in the comments. He also recommends reading:

Manufacture Of Poverty

Abstract:
In its advocacy for worker’s rights, the Kenya Human Rights Commission’s research into Women Working in Precarious Conditions in Export Processing Zones confirms the negative effects the conduct and actions of these key non-state actors have on human rights. Hence, justifying the need for monitoring by civil society in this new world order, where private corporations exercise inordinate influence over local laws and policies. With the decline in state authority, focus must therefore be turned to those sectors that have filled the void. The conduct and actions of these non-state actors have a direct impact on human rights ranging from violations of workers’ rights to environmental degradation.

Commonly hired on short-term contracts – or with no contract at all – women work at high speed for low wages, in unhealthy conditions, and they are forced to put in long hours to earn enough just to get by. Most get no sick leave or maternity leave, few are enrolled in health schemes and almost none have savings for the future. The insecurity of these jobs is not only material: they work under threats of sexual harassment. Traditionally, women are the care-givers in the home – raising children and caring for sick and elderly relatives. Women are still forced to play that role even when they have become cash-earners. Doubly burdened, and with little support from their governments or employers to manage, the stress can destroy their own health, break up their family lives and undermine their children’s chances of a better future.

The result? The very workers, who are the backbone of export success in many developing countries, are being robbed of their share of the gains that trade could and should bring. The impact falls on poor communities in rich countries, too, where workers employed in competing trade sectors likewise face precarious conditions. Many workers in the Kenyan Textile Industry feel worn-out after several years of hard work.

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Barclays off-shore banking will bring more of this to Ghana

Barclays offshore banking will bring more slums like this to Ghana

In a move guaranteed to increase poverty and crime throughout Ghana and West Africa, Barclays Bank, at the 2005 invitation of former President Kufuor, is setting up off shore banking in Ghana. Other big banks are waiting to join in the tax haven business in Ghana following Barclays lead.

Barclays bank is playing a lead role in the establishment of a tax haven in Ghana, in a move that could see huge mineral wealth in west Africa vanish into it from poverty-stricken countries’ coffers, the Observer can reveal.

The controversial British lender has for the last four years worked closely with the Ghanian government to start an International Financial Services Centre offering low taxes and minimal financial disclosure.

Development charities fear that the establishment of a fully operating tax haven so close to oil- and mineral-rich countries such as Nigeria, Sierra Leone and Equatorial Guinea will encourage a rapid increase in tax and capital flight.

There is also concern that cocaine barons, increasingly using west Africa as a trafficking route into Europe, could launder drug money through Ghana.

Oil-producing nations are plagued by corruption and drug trafficking and the creation of this international financial services centre will make this worse – not better.”

This move was initiated in 2005 by former President Kufuor. In light of what we now know about the theiving and raids on the treasury by himself and his cronies, it looks like they were planning ahead to hide stolen assets from the people of Ghana. We know Kufuor initiated this move from an article on GhanaWeb in 2005, when the offshore banking plans got underway:

Barclays Bank to assist Ghana establish off-shore banking
2005 Accra, March 30, GNA
Barclays Bank Plc is to assist the Government to establish off-shore banking in Ghana, Mr David Roberts, Executive Director of the Board of Directors of Barclays Plc and Barclays Bank Plc, said on Wednesday.

“We have to make the necessary arrangements to make off-shore banking operational in Ghana,” he said in reaction to an appeal by President John Agyekum Kufuor that the Bank cooperated with the Government to establish offshore banking.

President Kufuor made the appeal when a delegation of the Bank’s Directors attending the first International Executive Committee Meeting outside Europe in Accra, paid a courtesy call on him at the Castle, Osu.

The discovery of oil in Ghana was not announced until June 2007. But by 2005 they knew it was in the works. The Cape Three Points Deep Petroleum Agreement was signed in 2002, and potential oil fields mapped, also in 2002. So it seems likely Kufuor and his NPP cronies were planning for the influx of oil cash, and a place to stash and hide the money conveniently close to home. Even without oil, their misappropriation of government assets is impressive. There are many examples documented on GhanaWeb, such as Massive looting at Ministries, especially since the change in government has brought a bit more transparency. Financial transparency is what every watchdog group says is needed in the African oil and resource business. Financial transparency is what off shore banking is designed to eliminate.

Barclays Bank has been repeatedly implicated in illegal and unethical banking operations. In March the Guardian published a number of internal memos from Barclays, from WikiLeaks:

The documents are copies of alleged internal memos from within Barclays Bank. They were sent by an anonymous whistleblower to Vince Cable, Liberal-Democrat shadow chancellor. The documents reveal a number of elaborate international tax avoidance schemes by the SCM (Structured Capital Markets) division of Barclays.

According to these documents, Barclays has been systematically assisting clients to avoid huge amounts of tax they should be liable for across multiple jurisdictions.

A commentator to the Financial Times stated:

I was lucky enough to read through the first of the Barclays documents…

I will say it was absolutely breathtaking, extraordinary. The depth of deceit, connivance and deliberate, artificial avoidance stunned me. The intricacy and artificiality of the scheme deeply was absolutely evident, as was the fact that the knew exactly what they were doing and why: to get money from one point in London to another without paying tax, via about 10 offshore companies. Simple, deliberate outcome, clearly stated, with the exact names of who was doing this, and no other purpose.

Until now I have been a supporter of the finance industry – I work with people there regularly and respect many of them, and greatly enjoy the Financial Times and other financial papers. However this has shone a light on something for me, and made me certain that these people belong in jail, and companies like Barclays deserve to be bankrupt. They have robbed everyone of us, every single person who pays tax or who will ever pay tax in this country (and other countries!)

If Barclays can get away with this in the UK, with UK laws and enforcement, how much more can they get away with in Ghana, where the current legal and enforcement communities have a much shorter history, and are grossly underpaid.

Barclays have also been implicated in corrupt associations and illegal dealings with Equatorial Guinea, and along with other banks in Angola. From the BBC:

The same lax regulation that created the credit crunch has let some of the world’s biggest banks facilitate the looting of natural resource wealth from poor countries.

I have quoted Nicholas Shaxson in previous posts, but what he says regarding the movement of money is right on the mark:

There are basically three forms of dirty money. One is criminal money: from drug dealing, say, or slave trading or terrorism. The next is corrupt money, like the fromer Nigerian dictator Sani Abacha’s looted oil billions. The third form, commercial money – what our finest companies and richest individuals hide from our tax collectors – is bigger. The point – and this is crucial – is that these three forms of dirty money use exactly the same mechanisms and subterfuges: tax havens, shell banks, shielded trusts, anonymous foundations, dummy corporations, mispricing schemes, and the like, all administered by a “pinstripe infrastructure” of mainstream banks, lawyers, and accountants.
. . .
In this parallel secret universe the world’s biggest and richest individuals and firms, News Corporation, Citigroup, and, yes, ExxonMobil – can quite legally cut themselves loose from pesky full taxation and grow explosively, leaving smaller competitors, who pay their full dues along with the rest of us, choking in their dust. This undermines the very notion of capitalism: the big companies’ advantage has nothing to do with the quality or price of what they produce. If you are worried about the power of big global corporations, don’t always attack them directly, but attack bank secrecy instead. This is the clever way to take on the big fish, using a net that would also snag the Sani Abachas, the Mobutus, the North Koreas, the terrorists, and the drug lords.
(Poisoned Wells: The Dirty Politics of African Oil, by Nicholas Shaxson, p.225&227, ISBN 978-1403971944)

In 2007 Kufuor and Barclays raved on about what a wonderful opportunity offshore banking would be for Ghana:

President Kufuor said … the Government was fully aware of the numerous challenges and difficulties inherent in the operation of the facility and gave the assurance that the necessary safeguards had been put in place to stave off abuses.

Legal and administrative measures, he said, had been enacted to provide the needed checks and balances within the economy in particular and society in general.

“These measures should promote best practices in service delivery. More importantly, they should affirm the good faith and determination of the entire society to make Ghana a safe, secure and peaceful environment for investment.”

President Kufuor, through whose initiative the offshore banking had become a reality, said It must help to transform the financial system for accelerated socio-economic development.

He said last year, 658 billion dollars was transferred from developing countries to the developed countries, noting that if about half of this had been lodged in such a facility in Africa, the pace of development of the Continent would have been tremendously enhanced.

If that money had gone into offshore facilities in or near the developing countries, it would have made no difference. The reason for offshore banking is to evade the checks, balances, and safety measures. In fact, offshore banking will allow and promote the legal and illegal theft of money from Ghana, and is designed to do just that. Corporate money, drug money, stolen money, money from arms deals, money from illegal bunkering and corrupt politicians, all disappear offshore. Barclays and other big banks take money out of the reach of the countries those assets came from, and out of the reach of the governments and the citizens they are supposed to serve. I doubt Kufuor’s lavish praise for offshore banking was due to naivité. He was planning to be one of those advantaged by the bank at the expense of his own country. It is not for nothing he is known as Thiefuor to many of his countrymen.

Aside from those few who become very rich indeed, oil, and other extractive resources can make a country much poorer. The phenomenon is described in this article in Foreign Policy:

Collier’s model shows that producers of oil, timber, and minerals would on average see their gross domestic products rise by 10 percent in the first seven years, only to have them crash two decades later to only 75 percent of where they started. Sudden cash flows in unprepared countries, he says, lead to unsustainable public consumption, rising inflation, soaring inequality, trade protectionism, and a real danger of civil war.

As Shaxson points out:

People often put the problem like this: oil money would be a blessing but politicians steal it, so people don’t see the benefits. But it’s much worse: the oil wealth not only doesn’t reach ordinary people, but it actively makes them poorer.

Barclays and other big banks help make and keep the majority of people poorer. They insure there is no level playing field. Offshore banking is the tool that possessors of criminal money, corrupt money, and commercial money use to hide that money from its source, and to prevent reinvestment in the people and the places the money came from. That is why it is so shameful for Ghana to be setting up offshore banking. It is shameful that a former president initiated and promoted this tool to steal from the Ghanaian people, and it is shameful for the current government if they allow this to proceed as planned. If offshore banking goes forward, slums such as in the picture above will expand exponentially, people will suffer and die because their assets are being stolen from them, and they have nothing to fall back on.

imfpoultryEU dumping chicken parts on Ghana, cartoon by Khalil Bendib for corpwatch.org

Once again it looks like Africa will get to to subsidize the disasters of western capitalism.

In past global downturns, the severity of the impact on Africa varied considerably from state to state. This downturn is washing up on all of the continent’s shores, cramping both the formal and informal sectors as currencies lose value, the cost of imports rise, and living standards fall. As the big engines of regional growth have slowed – South Africa in the south, Nigeria in the west, and Kenya in the east – the contagion has spread to poorer countries in the landlocked interior.

Economists, investment analysts and policymakers were all slow to see this coming. Until late last year, many believed that the poorest continent would escape relatively unscathed from the gathering storms. This was partly because African banks were not exposed to the toxic assets eating away at Wall Street and the City of London.

It also resulted from the belief that the continent’s strengthening economic performance has been the result of interwoven trends, not just the commodity boom. …

it now seems painfully obvious just how vulnerable this emerging recovery was likely to be, given its roots in world trade and a relatively narrow base of exports.

Ghana has already suffered at the hands of the free marketeers, the banksters who are eliminating the middle class, and crushing the poor everywhere. Ghana has been the victim of agricultural dumping, chicken and tomatoes from the EU, plus rice from the US. From CorpWatch in 2005:

In 1992 domestic poultry farmers supplied 95 percent of the Ghanaian market, but by 2001 their market share had shrunk to just 11 percent. The imported chicken is available (wholesale) at a price that is only slightly more than half of the wholesale price of local chicken.

The accompanying loss of jobs has also been remarkable. The industry has lost 150 jobs in the past few months alone, say the Farmers Associations. Commercial poultry farms — which do not include small rural producers — employ up to 5,000 people. Any job loss has far reaching implications for Ghana’s 20 million people because each worker often provides support for numerous others in their household.

Foreign producers currently pay a 20 percent tariff or tax on the poultry they send to Ghana. Two years ago, the Ghanaian Parliament passed a law allowing an additional 20 percent tariff to be imposed on imported chicken, bringing the overall tariffs to 40 per cent.

In a dramatic move, just two months after the law was passed, the Customs and Excise Preventive Services (CEPS), the body responsible for implementing the tariffs, issued an order reversing the decision. The new tariffs were said to be in conflict with regional tariffs. In other words, the proposal have been blocked by the International Monetary Fund (IMF), an institution in which the Ghanaian government has less than 0.5 per cent of the vote.

Adding insult to injury:

The IMF made it clear that it was opposed to the higher tariffs on the grounds that it will hurt Ghana’s poverty reduction program.

Wheareas IMF policies consistently increased the number of unemployed, expanded poverty, and decreased productivity and self sufficiency in Ghana as in most countries.

There is some question as to whether a 40 percent tariff on the chicken would actually solve the problem. According “For Richer or Poorer” an April 2004 report released by Christian AID, it was estimated that “tariffs would need to be 80 percent, four times their current level” to allow local producers and processors to compete fairly with EU imports,” because “European producers gave enjoyed decades of subsidies, support and protection from their government.”

In fact IMF policies expand and increase the reach of poverty:

“It is through no fault of ours that our production costs are high,” he adds. “Just look at electricity and water tariffs, as well as the price of petrol and diesel. So, in plain terms, our government is telling us to fold up.”

As pointed out farther along, those electricity and water tariffs are the direct result of IMF actions.

In fact, most members of the once thriving 400,000 member National Association of Poultry Farmers have folded up. And Ghana’s rice and tomato industries are equally threatened.

… Ghana was on the way to becoming self-sufficient in rice production in the 1970s and 1980s. But the IMF structural adjustment program halted farm subsidies to rice farmers. Ghana now produces a mere 150,000 tonnes of rice, or 35 percent of its domestic need.

No longer able to farm because of the high prices of agriculture inputs, many young people are flocking to the urban centers searching for non-existent jobs. More displaced people from the rice and poultry sectors are bound to increase the numbers drifting to the urban centers, causing social problems.

The greed and theft of Wall Street are hitting Ghana through no fault of Ghanaians:

This is a good place to survey what Wall Street and the City of London did to the world. Ghana, which has met its millennium goals on children in primary education and cutting poverty, has been an economic and political success story, with high growth. A centre-left government has just taken over after hard-fought but peaceful elections. It is better protected than some, the prices of its gold and cocoa holding up in the recession. Offshore oil will flow in a few years.

But last year world food and oil prices soared. China’s slashed demand for raw materials is harming much of Africa. Global warming caused a drought that drained the dam powering Ghana’s electricity, requiring crippling oil imports. The last government borrowed to cover these unexpected costs, the currency dropped in value, inflation rose to 20% and credit has dried up.

Economists at the NGO Oxfam point out that this was not caused by profligacy, but by external events last year. A further source of bitterness: if rich countries had kept their 2005 Gleneagles promises, as Britain did, Ghana would have received $1bn, with no need to borrow at all.

Where should Ghana turn? To the IMF, of course, now the G20 has swelled its treasury. But there is deep political and public resistance after previous bad experience. Remember how humiliated Britain felt going cap in hand to the fund in 1976. Ghanaians know how World Bank and IMF largesse came with neoliberal quack remedies.

Cutting public services, making the poor poorer, putting cash crops and trade before welfare was the old IMF way. It was the IMF that insisted on meters for Ghana’s water supply, demanding full cash recovery for the service, steeply raising costs for the poorest. The World Bank insisted on a private insurance model for Ghana’s health service that has been administratively expensive and wasteful. The new government rejects it, promising free healthcare for children. The IMF wants subsidies for electricity removed, again hitting the poorest hardest. A market policy of making individuals pay full cost for vital services instead of general taxation has made the IMF hated; Ghana has now voted for more social democratic solutions. Freedom from the IMF feels like a second freedom from colonialism to many countries.

No wonder the new government hesitates to apply for a loan

The IMF protests that it has changed: it no longer prescribes or monitors so oppressively, and countries seeking loans can set their own goals. A British cabinet minister was quoted on G20 day as saying that it should be no more stigmatising than “going to a spa to recuperate”. Arnold Mcintyre, the IMF’s representative in Ghana, insists that it would be entirely up to the government to propose its own measures. This is, to put it politely, disingenuous.

Every government knows what it has to do to get credit, so Ghana has already said it will lower its deficit from 15% to 9.5% of GDP in one year, steeply cutting public sector costs. “They can do it through efficiency savings, with no damage to services,” says Mcintyre breezily. The government grits its teeth and says it can, and will: IMF economic thought often enters the soul of finance ministers. IMF power makes it the sole credit-rating agency for all other donors and lenders – an IMF thumbs-down means money from everywhere is cut off.

Oxfam’s senior policy adviser and economist, Max Lawson, doubts such cuts are needed, just a loan to tide Ghana over. “The IMF is too brutal … demanding balanced books within one or two years. The only way to make such a deep cut is in social spending: teachers’ salaries are the main item.”

It’s a strange irony that Barack Obama and Gordon Brown embrace a Keynesian fiscal stimulus and in its name pour out global largesse to the IMF to distribute. But loan recipients risk a Friedmanite tourniquet, cutting off their economic lifeblood. Will Obama and Brown see how their policy is translated on the ground?

Free market is a religion, a belief. It is not science or economics. We have brutal global evidence that it does not produce the advertised results, or live up to its promises. As long as the true believers are in charge, there will be no substantive change. The article quoted above points out that microcredit, and local credit unions are the way to raise productivity, relieve poverty, and increase the numbers of children in school and spending on education. The tiny local credit unions in Ghana discussed in the article have a 0% default rate on their microloans. But none of that is big and glamorous, and it does nothing to add to bankster CEO salaries and bonuses. So I doubt we will see much change in the behavior and policies of the IMF.

Note (4/28/09):
Khalil Bendib very graciously extended permisssion to use the cartoon above.  His cartoons combine elegant drawing with witty and incisive commentary.  You can see more at his website: The Pen is Funnier Than the Sword.  
You can buy his book here.

nomonsanto

Green washing = Public relations designed to convince people that biotech, genetically modified foods and agricultural chemicals, are environmentally friendly.

Poor washing = Efforts to convince people we must accept a program such as genetic engineering to increase yields to end hunger, reduce costs, and improve livelihoods of farmers and poor people. Poor washing has created calls for a “new” Green Revolution, especially in Africa, although there is little evidence that genetic engineering and agricultural chemicals, or moving farmers off their land, will realize any of these claims. There is mounting evidence of genetic engineering doing serious harm. Forcibly displaced populations always suffer harm.

From Voices From Africa: African Farmers and Environmentalists Speak Out Against A New Green Revolution In Africa PDF:

In June 2008, the United Nations held a High-Level Conference on Food Security that gained much prominence in the midst of the food crisis and became a key venue to promote genetically engineered food as a solution to world hunger.

Despite the overwhelming opposition to genetic engineering and chemical-input based agriculture, the biotech industry—with assistance from rich donor nations, multilateral institutions, and the philanthropic community—has used the food price crisis to gain support for GM crops. The result of the biotech industry’s well-financed publicity blitz based on “green washing” (biotech is environmentally friendly) and “poor washing” (we must accept genetic engineering to increase yields to end hunger, reduce costs, and improve livelihoods of farmers), have been calls for a “new” Green Revolution, especially in Africa.

… AGRA is the biggest grantee of the Gates Foundation. With over $262 million committed, AGRA is poised to become one of the main institutional vehicles for changing African agriculture.

Key positions in AGRA are all held by people who owe their careers to Monsanto and the biotech industry:

In 2006, the Gates Foundation appointed Dr. Robert Horsch as the Senior Program Officer in the Global Development Program, which directly supervises the AGRA initiative. Horsch came to the foundation after 25 years on the staff of the Monsanto Corporation

Another major player hailing from the St. Louis biotech hub is Lawrence Kent of the Danforth Center, an institute that is heavily funded by Monsanto. … Unsurprisingly, on January 8, 2009, St. Louis Post Dispatch reported that the Gates Foundation has awarded a $5.4 million grant to the Donald Danforth Plant Science Center, to “help the center secure the approval of African governments to allow field testing of genetically modified banana, rice, sorghum and cassava plants that have been fortified with vitamins, minerals and proteins.”

Lutz Goedde, another hire from the biotech industry, is the former CEO and President of Alta Genetics, and is credited with making Alta the world’s largest privately owned cattle genetics improvement and artificial insemination company. All three are working for the Gates Foundation, funding projects aimed at the developing world.

No African farmers, none, have been consulted for the foundation’s agricultural strategy. None of the reviewers or the external advisory board members is a farmer from Africa.

AGRA and the Gates Foundation speak about “land mobility” which means moving farmers off their farms so the land can be used for large scale mechanized agriculture. But there is no mention of where these people will go and live, and how they will be reemployed. What this means is thousands of displaced people moving to slums around the cities, which will grow and will be filled with unemployed people. This is politically and socially destabilizing. It breeds crime and political violence. This kind of policy also hits women particularly hard, because in western models such as corporate agriculture, their traditional rights to land are ignored. Women are the majority of agricultural workers, and will become even more impoverished and disenfranchised, not that it will bother AGRA or Gates or Monsanto, as they say:

Over time, this will require some degree of land mobility and a lower percentage of total employment involved in direct agricultural production.

People in Africa are taking action and speaking out.
From: A Statement by Friends of the Earth—Africa at the Annual
General Meeting held at Accra, Ghana, 7-11 July 2008
:

Members of FoE Africa from Ghana, Togo, Sierra Leone, South Africa, Nigeria, Mauritius, Tunisia and Swaziland met for five days in Accra, Ghana reviewing issues that confront the African environment. A particular focus was placed on the current food crisis and agrofuels on the continent.

FoE Africa groups deplored the characterization of Africa as a chronically hungry continent; and rejected the projection of the continent as an emblem of poverty and stagnation and thus as a continent dependent on food aid.

FoE Africa reiterated the fact that the agricultural fortunes of the continent have been dimmed by externally generated neoliberal policies including Structural Adjustment Programmes imposed on the continent by the World Bank, IMF (International Monetary Fund) and other IFIs.

FoE Africa expressed disgust at the manner by which the burden for solutions to every crisis faced by the North is shifted onto Africa. Examples include the climate change and energy crises wherein the burden has been inequitably placed on the continent. Africa is forced to adapt to climate impacts and she is also being targeted as the farmland for production of agrofuels to feed the factories and machines in the North.

FoE Africa resolved as follows:

1. Africa contributed very little to climate change and the North owes her an historical debt to bear the costs of adaptation without seeking to further burden the continent through so-called carbon finance mechanisms.

2. Africa must no longer be used as a dumping ground for agricultural products that compete with local production and destroy local economies.

3. Africa must not be opened for contamination by GMOs through food aid and/or agrofuels.

4. Africans must reclaim sovereignty over their agriculture and truncate attempts by agribusiness to turn the so-called food crisis into money-making opportunities through price fixing, hoarding and other unfair trade practices.

5. We reject the promotion of conversion of swaths of African land into monoculture plantations and farms for agrofuels production on the guise that some of such lands are marginal lands. We note that the concept of marginal lands is a cloak for further marginalizing the poor in Africa through their being dispossessed and dislocated from their territories.

6. Africa has been subsidizing world development for a long time and this has to change and African resources must be used for African development to the benefit of local communities.

FoE Africa calls on all communities of Africa to mobilize, resist and change unwholesome practices that entrench servitude and exploitation on our continent.

Signed:
FOE Ghana; FOE Togo; FOE Nigeria; FOE Cameroon; FOE Sierra Leone; FOE Tunisia; FOE Swaziland; FOE South Africa; FOE Mauritius

There is much more in the report, you can read the whole document here: Voices From Africa: African Farmers and Environmentalists Speak Out Against A New Green Revolution In Africa PDF

bordercaution

The article Towards a Nomadic Fortress mentioned in my previous post, has a lot to consider when thinking about the contemporary functions of borders.

No longer just a question of contested territory, hard boundary lines, and stricter border enforcement between two nations, but a space that functions more ubiquitously on several paradoxes around global mobility and a rise in detention markets, detention politics, national security as the new global architecture.

Rather than a single structure, the nomadic fortress is a whole syntax of control spaces linked across multiple landscapes that constitute perhaps the world’s first universal border fence, loosely connected across continents through a kind of geopolitical geometry that super-imposes a border just as much as enforces one between the First World and the Global South. It is, you might say, the Great Wall of Globalization.

This space has no regard for borders any more as we traditionally understand them, no respect for national territory; it hovers over and slips between those definitions, goes around and under them when it needs to, ultimately passing through border fixity as it sees fit. It is in some way the final border, a border that is never at rest but is always modifying itself for greater tactical vantage; a kind of flexible mock-hydrological regime that deploys and aligns other sub-border levers and valves below it to secure the conduits of neoliberal capitalism and the flows of people who are captives of them in one way or another.

This border doesn’t take the defensive posture that borders traditionally have in the past, but instead is on the move and on the hunt for a new class of would-be border crossers who’ve been bound together in a dangerously wide-cast surveillance net that is incapable of distinguishing the refugee from the enemy combatant, the migrant from the smuggler, laborer from insurgent.

Finoki draws a global hydrologic picture of borders. He provides a lot to think about when we think about our home countries, or about wherever we may travel.

capital is devising an unprecedented perimeter that encircles the global south through a flexible and strategic militarization of cross-border flows and refugee internment.

Since commerce, goods, and information now flow freely within a kind of liquid society of transnational interplay, the substrata of cross-border migration has become more of a parched landscape where liquidity and fluidity (in terms of movement) have been extremely deprived. Instead, the nomadic routes of migrants and refugees are dictated by tactical arrangements of concrete embankments, unsurpassable berms, dangerous ditches, trenches, and other deployed dikes and levees strictly designed to prevent the north from being flooded by the populations of the south. We can think of these floodgates as goliath mechanisms of bio-political hydrology, re-flooding certain labor zones and reservoirs with migrants ripe for exploitation while drying up other labor wetlands altogether where manufacturing industries have evaporated or moved on to different regions. Today’s border fences are less about stopping the flows of mass migration than they are about engineering a whole taxonomy of barriers that can identify and redirect them, informally outsourcing the pools of global labor from one geography to another. And while some routes are pushed deeper underground by all of this, other subterranean passages are merely forced to the surface. This massive border hydrology is shifting human resettlement patterns for generations to come.

The political implications of this are huge, and the political results are already well underway. But I have not seen the issue addressed as a global issue other than here. It is certainly worthy of more discussion and examination.

USNS Lewis and Clark

USNS Lewis and Clark

See a diagram of the USNS Lewis and Clark at Global Security

A friend sent me this link to Captives of Lewis and Clark. The writer, Bryan Finoki, looks at political and policy issues from an architectural perspective, how people use space. In this case the space is prisons the US is creating to incarcerate captives of the selective war against the Somali pirates in Somali waters, leaving the illegal unreported and unregulated, IUU, fishing fleets from around the world, and the illegal toxic dumping, to continue unimpeded.

I have long been disturbed by the way in which the US has replaced slavery with its prison system at home. During the Bush administration incarceration of poor and brown people became globalized, and far more brutal and abusive. So far Obama seems to be continuing the same pattern.

As part of a larger multinational effort, the U.S. 5th Fleet has sent additional ships into the gulf, that will be joined by the Coast Guard and other combat Marine search and seizure teams. While the UN uses UNOSAT to watch the seas from space, the Navy is using “an unmanned aerial spy plane known as the ScanEagle for target surveillance.” In what Navy Commander Stephen Murphy has described as “sort of racial profiling at sea,” the drone’s aerial footage is used “to help determine whether those on board the skiff are ethnic Somalis, and thus more likely to be pirates, or simply fishermen from elsewhere.”

The “simply fishermen from elsewhere” are simply pirates stealing the food and livelihood of the Somalis. But no one is even questioning that piracy, no one is protecting the interests of the Somalis. With the country weakened by close to two decades of war and civil strife, Somali seas are wide open to exploitation, including the illegal dumping of nuclear waste.

Yet, what interests me most in all of this is one vessel in particular that will be joining this crew – the USNS Lewis and Clark, an old 689-foot, 24,000-ton Navy cargo ship, or T-AKE supply ship, that has been converted into a naval detention facility. According to Strategy Page, this ship has had its crew reduced from 158 to 118 so accommodations for 26 prisoners could be improvised.
The T-AKE we learn “is the grandchild of the Servron” which developed out of necessity during World War II … these Servrons also acted as prison ships during WWII.

But for now, you can add the USNS Lewis and Clark to the list. In addition to concerns about mistakenly detaining innocent fisherman or innocents others, what could also be potentially very worrisome is whether this vessel will have any use or role in the roundup and rendition of ‘terrorist suspects’ in the good ol’ ‘War on Terror’ where too little transparency around unlawful detention and rendition exists.
If you read this article you will note, “Currently, six (T-AKE’s) are in service and eight are on order. The fourteen T-AKEs will replace 16 existing supply (separate ammo, cargo and fuel) ships that are reaching the end of their 35 year service life this year.” Not to read too much into things, but that could spell fourteen new prison ships soon circulating international waters. With the capacity for each to hold roughly 25 detainees, that would be 350 persons that could one day be swallowed up by the indefinite chambers of the nomadic fortress at sea.
Anyway, not to jump to any grim conclusions, all I’m sayin’ is it’s another ship to watch as the waves roll on.

Finoki ties this into a much larger picture of the use of space and the movement of peoples that are part of globalization.

…the nomadic fortress is a whole syntax of control spaces linked across multiple landscapes that constitute perhaps the world’s first universal border fence, loosely connected across continents through a kind of geopolitical geometry that super-imposes a border just as much as enforces one between the First World and the Global South. It is, you might say, the Great Wall of Globalization.

… It is in some way the final border, a border that is never at rest but is always modifying itself for greater tactical vantage; a kind of flexible mock-hydrological regime that deploys and aligns other sub-border levers and valves below it to secure the conduits of neoliberal capitalism and the flows of people who are captives of them in one way or another. A structure that utilizes an entire atlas of border fences with a range of satellite technologies, web-based border vigilantes and extra-territorial floating prisons, to feed the border as a kind of geopolitical gutter space that siphons the subjects of migration off into a swollen infrastructure of detention where billions of dollars and are spent on their bounty.

It is a fully transitional geography of unsettled coordinates, excessive legality and perpetual legal suspension. This border doesn’t take the defensive posture that borders traditionally have in the past, but instead is on the move and on the hunt for a new class of would-be border crossers who’ve been bound together in a dangerously wide-cast surveillance net that is incapable of distinguishing the refugee from the enemy combatant, the migrant from the smuggler, laborer from insurgent. It is the border as the worst kind of political blur space. It is as immovable as it is fluid, like a sea of transparent blast walls crashing on the shores of geopolitical exile.

Being incapable of distinguishing the refugee from the enemy combatant, the migrant from the smuggler, and laborer from insurgent has been a distinguishing feature of US policy, and policies of countries around the world during the Bush administration. This inability to distinguish is particularly true of the US and US proxies in Somalia and Kenya, and along the border between those two countries. I don’t feel any change in the air on this.

And to flesh out the picture, you may want to look at Finoki’s post on floating prisons coverted into housing, floating labor camps for migrant labor. Or the prisoner boxes used by the US in Iraq, where the space is the torture.

These are just a few of the blessings that AFRICOM and ongoing military liaison can bring to African “partners” that will “add value to the important endeavor of stability and security on the content of Africa and its island nations” and will “help build the capability for African partners, and organizations … to take the lead in establishing a secure environment“.

ricemadagascar

Rice fields in Madagascar

Glenn Ashton of the The South African Civil Society Information Service has written a telling article about the new colonial land grabs in Africa titled Madagascar: the new land grab.

Just when colonialism was considered dead and buried, along comes neo-colonialism in its latest guise. Allied with its close relatives globalisation, free marketeering and lack of transparency, it is currently launching a new offensive on the disempowered population of this continent. …

Neo-colonialism is now garbed in new clothes. Powerful interests are presently seeking and gaining access to land in government-to-government deals as well as through private capital. These arrangements ostensibly offer to manage land that is not being economically utilised in order to improve food security. But for whom? …

The global food security focussed NGO, GRAIN, issued a report on this phenomenon in October 2008, where they cited more than 100 examples of this new neo-colonial land grab. These land grabs are primarily by nations that have insufficient natural capital or space – such as the desert-bound nations of the Middle East and overpopulated nations such as China and South Korea. They seek to improve the food security of those nations while undermining the ability of host nations to access similar benefits, through the alienation of prime agricultural land. The ecological impacts can also be significant.

Since the GRAIN report was published, the land grab has continued apace. The recent acquisition of a reported 1.3 million hectares (ha) of land in Madagascar by the South Korean company Daewoo Logistics Corporation on 99-year lease has raised eyebrows around the world. This land represents around half of that island nation’s arable land.

In Madagascar a reported 70% of the population suffer from food shortages and malnutrition. Nearly 4% are fed through aid programmes. Besides this, more than 50% of the population is below the age of 18. What hope is there for local youth when South African farmers are reportedly being recruited to run the highly mechanised and automated farms under the Daewoo lease? …

China is also actively seeking new land. Given its massive population and constrained access to farmland, China has moved aggressively into Africa with land interests in Zimbabwe, Mozambique, Nigeria, Uganda, Cameroon and Tanzania. …

Even the World Bank is continuing its role as a neo-colonial consensus agent by actively pursuing and financing access to ‘under-utilised land’ around the world through its International Finance Corporation.

Of course much of the land is “under-utilised” because African countries were following World Bank recommendations and requirements. Malawi used to provide free seeds and fertilizer to its farmers.

The results were impressive, but the subsidies ran afoul of the pro-market policies of the World Bank and International Monetary Fund (IMF), which argued that subsidies were “crowding out” commercial sales and constituted undue government interference in the economy. Under considerable pressure from these financing institutions, the programme was phased out. The IMF also insisted that Malawi sell much of its national grain reserve to pay off the debts of the state-owned maize marketing agency.

Most Malawian farmers, however, were too poor to pay commercial rates for fertilizer and seeds. As a result, maize yields plunged. When drought struck in 2001 neither farmers nor the government had adequate grain stores to see them through, and more than a thousand people are estimated to have died. Then after the failed 2005 harvest left 5 million of Malawi’s 13 million people on the brink of starvation, the newly elected government of President Mutharika defied the donors and launched the subsidy scheme with its own funds.

Without the seeds and fertilizer, the land was “under-utilized.” People starved because they could not farm. This has been World Bank and IMF policy throughout Africa. As Ashton points out:

… international finance instruments run by the then G5 (now expanded to the G8), such as the World Bank and the International Monetary Fund used aid and so-called development finance instruments to further their interests.

It has been established by repeated research over decades that the smaller the farm the greater the yield. For more information read the article Small is Bountiful, and check the references listed at the end. There are economies of scale with big agriculture. Big agriculture allows the proceeds to be concentrated among a few people unrelated to the people actually living on the land. It is generally harmful to the land, due to the use of toxic chemicals needed to sustain monocultures, and due to unsafe genetic engineering. It is harmful to the people who live in its vicinity, depriving them of their livilihood and damaging their health.

Ashton continues:

Perhaps more sinister is the recent news of leasehold rights being acquired for approximately 400,000 hectares of land in the Southern Sudan from the family of former warlord Gabriel Matip. In a deal struck by US financier Philippe Heilberg, who has used a British Virgin Islands subsidiary of his Jarch Group to facilitate the deal, private interests have intervened directly in disputed territories. Co-directors of the group reportedly include ex-CIA operatives. Given the ongoing instability in that nation and the forced eviction of millions in the neighbouring Darfur region, this sort of land acquisition is perhaps a harbinger of an unsavoury trend in who gets to control the land in disputed territories.

I wrote about this in an earlier post: Jarch Colonial Holdings, and quote Heilberg: “You have to go to the guns, this is Africa”. His intentions are clear. The Jarch management contains people with connections to both the current and the previous US administrations. You can see their management listed on the Jarch LLC website.

Ashton concludes:

Activities to increase agricultural growth in Africa have also been severely compromised by questionable alliances. For instance AGRA, the African Union endorsed ‘Association for a Green Revolution in Africa,’ has seen the undemocratic and unsolicited intervention of supposedly neutral funders such as the Bill and Melinda Gates foundation. The relationship between these funders and pro-genetically modified food interests (in what is now termed bio-colonialism) has served to actively undermine local agricultural collectives, NGOs and projects that aim to promote and share proven solutions to food insecurity and malnutrition.

This is perhaps the most dangerous manifestation of neo-colonialism as it operates behind a veil of philanthropy while (wittingly or unwittingly) undermining democratic structures and interests. The obscene profits accrued by capital over recent decades, instead of being taxed and distributed by state organs, are now in the hands of ill-informed and often ideologically biased do-gooders. For instance, given the technocratic origins of the Gates fortune, it is logical that undue emphasis will be placed on similar technocratic agricultural solutions.

These ‘solutions’ are imposed through slick public relations and the support of corporate aligned agri-business interests such as Africa-Bio and A New Harvest, both of which are linked to GM corporations such as Monsanto, the worlds biggest seed company and genetically modified seed distributor.

There is an urgent need to examine these new neo-colonial thrusts. Careful and objective analysis must be undertaken as to how food and land sovereignty is being compromised through naïve interaction with the new global powers of finance and trade. The interests of global capital need to be tempered by intervention and through more pragmatic approaches that take account of the historical relationships between land, community, food security and economic development.

It is ironic that while Africans have fought to cast aside colonial oppression and its concomitant heritage, we have instead opened gates (pun intended) to a new wave of colonial interests that threaten, yet again, to bypass the marginalised whilst enriching a well-connected minority.

It would be tragic to cast aside Africa’s recently won freedom for a yoke of a different design.

Under democratic governance the people who live on the land would determine how their land is used. As Vandana Shiva writes:

In a democracy, the economic agenda is the political agenda.

The US claims to support and foster democracy. This is a test. In fact, it is probably THE test. Without food, none of us survive.

Added January 31:

From the GRAIN website:

THERE ARE FOUR MAIN PARTS TO THIS LAND GRAB BRIEFING:

1. A summary and announcement – available online here:
http://www.grain.org/nfg/?id=610

2. The full report is available here:
http://www.grain.org/briefings/?id=212
Also available in PDF format:
http://www.grain.org/briefings/?id=212&pdf

3. The Annex to this briefing is a table with over 100 cases of land grabbing for offshore food production as presented in this report. It is available in a separate PDF file:
http://www.grain.org/briefings_files/landgrab-2008-en-annex .pdf

4. GRAIN has released a Google Notebook with full-text news clippings collected during the research for this briefing as a support to those who want to read more.
http://tinyurl.com/landgrab2008

The notebook is only available online, and the news clippings are not in any order, but it can easily be searched. We are doing this because this is not always an easy subject to research on the internet, if you want a broad picture. People may add further clippings to the notebook as they wish, to further build this collective resource – if you would like to participate, please send an email to landgrab@grain.org . GRAIN will not be maintaining nor be responsible for it. Most of the articles are at present in English. (A backup copy is available in PDF format from here: http://www.grain.org/m/?id=209 )

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