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Aid is not a business opportunity
by World Development Movement & agencies
 
March 2013
 
Aid is not a business opportunity, says World Development Movement.
 
Directing billions of pounds of aid money to UK businesses may be good for the coffers of Coca-Cola and Tesco, but isn’t the role for aid, the British government was told today.
 
International development secretary Justine Greening announced yesterday that billions of pounds of aid money would go to UK businesses. The World Development Movement’s director Deborah Doane said in response today:
 
There is little evidence that private sector aid works, and there is plenty of evidence that strengthening public services like health and education in developing countries reduces poverty. Aid should always be about creating a more equitable society. It should never be about boosting returns for British shareholders.
 
“Recent experiments in privatising aid in this way have led to seriously lacklustre results. Nike’s DFID-backed Girl Hub project was slammed by the aid watchdog ICAI as having “serious deficiencies in governance” while DfID’s support for a US company called Dominion Farms in Kenya has led to the displacement of thousands of local people.
 
“The government is treading a dangerous line in its rhetoric. By seeking to make aid benefit UK companies, it risks harking back to the dark days of tied aid, when countries were forced to buy UK goods and services in exchange for aid money. It is widely acknowledged that tying aid to expenditure in the donor country is bad value for money: the OECD estimates that tied aid bumps up the cost of aid projects by 15 to 40 per cent. “Formal tied aid is now illegal, as was confirmed by the World Development Movement"s groundbreaking Pergau Dam case in 1994. But Justine Greening’s rhetoric about helping UK companies benefit from aid may send the wrong signals to developing country governments who may assume that UK assistance comes with a price tag attached. This is a retrograde step and is unlikely to help the world’s poorest people.”
 
British aid and the return of the trickle-down myth, by Nick Dearden.
 
Last week’s Guardian exposé of the investment of millions of pounds of British aid money in gated communities, high end shopping centres and luxury hotels came as a shock to people who have fought for the aid budget over many years. What’s even worse is that these projects are not aberrations, but represent a dangerous trend in aid spending, which has been taken to new levels by the current British government.
 
The Guardian reported on Saturday that the ‘investment arm’ of Britain’s Department for International Development (DfID), known as the CDC Group, has invested more than US$255 million in property and construction companies in Latin America, Africa and Asia. This includes companies that have built 10 gated communities in El Salvador, a high end property complex, business hotel and shopping centres in Kenya, and luxury beachfront homes and an elité British boarding school franchise in Mauritius.
 
Such ‘investments’ are central to the CDC’s so-called ‘development’ model. This body, formerly known as the Commonwealth Development Corporation, places public money in financial vehicles, which then invest in private enterprises that supposedly have difficulties finding finance.
 
In other words, it is based on the idea that ‘free’ financial markets are the best way to allocate capital. It is premised on the completely discredited notion, as shown in the examples above, that wealth ‘trickles down’ in a society. And it confuses return on investment with people’s lives getting better. Five years after the financial crash showed everyone the deeply anti-social impacts of unregulated financial markets, these concepts are clearly absurd.
 
Yet the British government is leading the charge to redefine development along exactly these lines. Former Secretary of State for International Development Andrew Mitchell published a pamphlet claiming, ''In my view it is not an unreasonable proposition to suggest that in 50 years time CDC will be seen as the principal British development structure, rather than DfID.''
 
Mitchell’s successor, Justine Greening, who appears to see herself more as a minister of investment than of genuine development, seems to share this view. Almost every other week, Greening launches a new private sector initiative or ‘financial vehicle’ (most recently, ‘development bonds’) which increasingly turn DfID into a facilitator of big business and big finance in Africa.
 
The World Development Movement recently revealed in New Internationalist that US$1 billion in British aid money is being channeled through the New Alliance for Food Security and Nutrition, a scheme that is helping the world’s most powerful agribusinesses get their hands on land, labour and markets in African countries.
 
The British government is by no means alone in its quest. The investment arm of the World Bank, the mighty International Finance Corporation (IFC), is the bank’s fastest growing section. In a brilliant exposé last year by journalist Cheryl Strauss Einhorn, the IFC was found to be funding some of the most expensive hotels in the world, in combination with superrich investors including Saudi royalty.
 
The report found: ‘The IFC has funded fast-food chains like Domino’s Pizza in South Africa and Kentucky Fried Chicken in Jamaica. It invests in upscale shopping malls in Egypt, Ghana, the former Soviet republics, Eastern Europe, and Central Asia. It backs candy-shop chains in Argentina and Bangladesh; breweries with global beer behemoths like SABMiller and with other breweries in the Czech Republic, Laos, Romania, Russia, and Tanzania.’
 
Another report, by the Bretton Woods Project watchdog, has shown that since the financial crisis, the World Bank has thrown US$36 billion into the financial sector – three times more than it has spent on education. With these investments have come serious allegations of water pollution, land grabbing and even murder.
 
There are similar institutions at a European level too – the European Bank for Reconstruction and Development, based in London, is currently set on restructuring Ukraine, Egypt and other ‘post shock’ countries.
 
So this view of ‘development’ is not new, but it is fast becoming the orthodoxy, with the encouragement of the British government. At such a time, it isn’t good enough for campaigners to simply defend aid budgets. DfID has never taken such an explicitly pro-finance, pro-big business approach before, yet ironically it now gets less criticism from campaign groups than at any time in its history. If we don’t want to see what we have fought being turned against us, we need to clearly call out what is going on, and help define a real development agenda for the 21st century.
 
* Nick Dearden is director of World Development Movement.
 
http://www.wdm.org.uk/ http://www.guardian.co.uk/global-development/poverty-matters/2013/jun/12/g8-vision-tackling-hunger-politics-malnutrition http://newint.org/blog/2014/05/07/investment-of-aid-money-britain/
 
Jan 2013
 
On AusAid’s: private-sector development strategy – which advocates for the privatization of state-owned providers.
 
Senator Faulkner, yes I do want to make a formal representation to the Foreign Minister, with regard to this matter, and also to bring it to the attention of members who are supporters of the important role of the public sector.
 
Again, I would like to emphasize I most strongly support the humanitarian endeavor of AusAid’s work and programs. However, one’s life experience teaches one to look beneath the surface so to speak, and I have been greatly troubled by what I regard as the capture of public policy at the Commonwealth, State and Territory arena’s by private sector interests seeking to advance their own self interest, in my view on too many occasions at the expense of the broad public interest.
 
In my view, the Labor side of politics has not been immune to this reality. I think the concerns I raise highlight a similar worldview, seeking to use aspects of the Australian overseas development program to advance their interests. To be brutally frank, I consider there to be members of the Government, and most certainly the current Opposition of such a view. No doubt significant lobbying is brought to bear on the Government and Opposition, and wondrous arguments advanced as to the many benefits of advancing such policies.
 
Pressures are brought to bear on AusAid and Dfat and other agencies of Government to advance these interests. Those who would advance these interests achieve career advancement within agencies, review committees are populated with their adherents. This worldview is also actively advanced in the public domain by commercial media agencies to bring further pressures to bear. Not only in Australia, but by others who share this commercial world view of the “wonders” of the market to solve all the problems of inequality, poverty and foster development.
 
Recently, one observes for example, “land grabs”, the privatization of water resources, the use of aid to advance national and multinational commercial interests. Not only by ourselves and our “allies”, but also by many other countries seeking to advance their own commercial interests.
 
At a macro level agencies such as the IMF, the International Finance Corporation, indeed aspects of the World Bank’s programs embrace aspects of such private sector worldviews. Yet, the fact remains half the world’s population lives on less than $2 a day, and there are different relations of power in societies. That inequalities within and between countries are ever widening.
 
Post GFC there are great pressures being brought to bear on the public sector, and this is not merely a function of reduced revenue receipts, but also one of ideological narratives, as you are most certainly aware.
 
The troubling aspect of this is that the privatization policy is in place, those who have advanced it, have succeeded, it is Government policy. I am of the view that members of the “right” have advanced such policies on behalf of business interests and believers in the privatization model, and its benefits for commercial gain. Recent reports on the International Finance Corporation by Propublica highlight funds used to build a 5 star hotel in Ghana, the funding of many multinational enterprises by the IFC and World Bank, to purportedly advance the interests of those in poverty through this development model. But are not the taxpayers through such bank loans just building market share for these businesses and funding the development for new customers, and the profits of businesses funded to realize these projects.
 
AusAid cites an example in PNG of a company called Digicel in partnership with international banks developing the mobile networks in PNG; it sounds great, more mobile users, coverage, distributors. But is it not the case, that distributors are all selling Digicel products, has not Digicel grown it’s market share, and its profits grow. Its business involvement was for direct commercial gain; its development funded by bank’s supported by national taxpayers. How much of this business does the PNG Govt. own, I envisage little if nothing, it may be able to raise taxes from the declared incomes of the distributors and employees.(I note China’s early development model was to mandate 51% Chinese ownership of business investments in the country. A policy no doubt it does not necessarily follow in its offshore investments).
 
Today Radio Australia reports from the Pacific where much land is being sold to multinational business interests. Land that was the primary source of income and food generation for local populations. AusAid was required to fund African delegations to Australia to discuss mining governance tax regimes. When our mining tax was watered down after fierce lobbying from business interests. Australian mining companies are reported to have invested as much in Africa as in Australia in recent years, tens of billions of dollars. Yet Australian taxpayers are asked to fund delegations. Surely these same companies lobby the government over the tax regimes AusAid and the Government was advancing, to best advance their commercial interests. Gina Rhineheart lauds African workers who work for $2 a day.
 
A similar tale is true in Mongolia. Just 2 weeks ago, the UN Special Rappouteur on Poverty, after visiting Mongolia expressed her serious concerns over the poverty for large sections of the population, the ABC’s Stephen McDonell report highlighted similar concerns. Yes, tax revenues will rise with the new investments, but at what rate, in whose interests, what is the development model. History is replete with Government’s and businesses seeking out relevant political parties, politicians and ministers who will best advance their interests. Transparency International every year issues reports on corruption. Offshore tax havens are reported by the Tax Justice Network to amount to $32 trillion. Environmental standards, workers health and safety, small scale farmers land titles, water access and affordability, workers minimum wages and conditions, land rights to name just a few more examples of the impacts of this policy. In South Africa when they privatized water there were riots in the townships because people could not afford to pay. Today in South Africa, the news reports mining workers and farm workers striking over low wages inadequate to meet living costs. In many countries poor people cannot afford the private costs for education, health care costs. How will privatization help?
 
I am concerned by the notion of downgrading state-owned providers to be replaced by private sector providers. I consider this a subjective view. Shouldn’t we be encouraging greater efficiency of state owned enterprises rather than replacing them with national and multinational private sector enterprises.
 
Though I understand differing states are at differing levels of development and have differing realities, I am unconvinced that only private sector solutions avail the optimum results for the majorities of populations. For example the citation of Bangladesh clothing workers as economically competitive is very troubling considering the recent fire, and low wages workers receive.
 
I am not anti-business, I am no fool. I understand development is important, and business generates tax revenues to fund public services. However, I am aware of the differing relations of power in societies and between countries, and can see past motherhood statements. I believe it to be in Australia’s interest and in fact our business interest to act with integrity, in good faith for others interests, to advance the public interests’ of broad sections of societies, with special regard for the bottom 50% percentiles. Such policy action will generate trust, and faith in our sound intentions by Government’s and peoples. When Governments change or people’s movements mobilize such an understanding in our good faith actions and intentions will stand us in good stead for the long term come what may.
 
My belief, most particularly with regard to our overseas development policies for developing countries is that the humanitarian intent and imperative, the public interest of populations is our first priority, not the self interest of business interests seeking greater profits with the support of our Government and taxpayer funded public sector agencies.
 
I have cited just a few examples, but believe the concerns I raise are multifaceted, will affect populations for many years, potentially decades, will shape societies access to goods and services, quality of life, power to control their own lives, have the potential for profound impacts. As these concerns focus on models of development for the future, and impact on the lives of many sections of populations and their power and possibilities within their own societies.
 
I am aware most obviously that national governments will seek to influence these developments, but in the pursuit of development aid and economic development those with the most money are in the strongest positions to influence this course. Australia is on the G20, takes part in regional forums, is a member of the UN Security Council, and is one of the more developed countries in our region. We currently seem to be advancing the privatization of public sector agencies, advancing the interests of business models over democratic models that might better share the benefits of growth. We are advancing regulatory regimes to accommodate this. I do not have faith that we are empowering peoples; rather the privatization development model is empowering business interests to maximize their profits, not only in the short term but also in the medium to long term by seeking to shape the entire landscape in their favor.
 
I hope those with broad conceptions of the public interest concerns I am endeavoring to raise in good faith, out of regard for the human dignity and rights of so many others will bring your voices to bear. To best ensure we are advancing a common regard for the best interests of our fellow men and women in the world in advancing our public policies and programs.
 
Mr. Kim Gleeson. Director, Universal Rights Network
 
* Reference: http://www.ausaid.gov.au/Publications/Documents/private-sector-development-strategy.pdf
 
Economic reform - Page 23-24: “In many partner countries, for example, state-owned providers of power, water, telecommunications and transport offer poor quality and costly services. This increases the costs of doing business for all firms. Reforms in these key sectors help improve the broader business environment..” .. “Australia also supports governments to increase productivity across the economy, including by reforming state-owned enterprises..”
 
Box 8: Reforming state-owned enterprises:
 
“In many Pacific Island countries, state-owned enterprises have recorded relatively poor performance due to weak governance, conflicting mandates, the absence of hard budget constraints and the lack of transparency and accountability (Table 2). Since 2006, AusAID has supported the reform of these enterprises in the Pacific through the Private Sector Development Initiative (PSDI). A key focus of the PSDI is to develop the role of the private sector in providing goods and services currently provided by state-owned enterprises. For example, liberalisation of the mobile telecommunications".
 
(There are a number of other private sector policy documents with aspects that raise similar human rights concerns. I consider a number of the examples cited to be a selective representations and coloured to advance a particular privatization rationale. I regard this document as quite signficant as it informs Australia’s foreign policy in our region and beyond. I remain unconvinced with the benefits to publics of this policy. I am concerned by citing cherry picked “bad examples” and this then being extrapolated to all situations. I believe this document has potentially profound implications. Is Australia advocating for the privatization of state public services in international and regional forums as its preferred development model? Who benefits? Business shareholders or populations? Once in place such models may remain for 10, 20, 30 years.. What if you can’t afford to pay for the privately provided services?
 
There are numerous international examples where the privatization of the provision of public services has not necessarily benefited poor and low income sections of society. I understand aid budgets have been shrinking and there are many challenges to face, but what safeguards and considerations are in place with such policies to adequately protect the broad public interests of populations?)


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Between Free Speech and Hate Speech, Promoting greater respect and tolerance
by UN Human Rights Office (OHCHR)
 
Between Free Speech and Hate Speech: The Rabat Plan of Action, a practical tool to combat incitement to hatred. (OHCHR)
 
Following several workshops on the prohibition of incitement to national, racial and religious hatred organized by the United Nations in various regions of the world, a plan of action to prevent incitement to discrimination, hostility and violence, as outlined in article 20 of the International Covenant on Civil and Political Rights, was presented by internationally recognized experts at an event held in Geneva on 21 February.
 
The a wide rangeof experts have worked together on this issue over the past two years to reach a consensus on how to effectively address the issue of incitement, and have devised a clear pathway to help us identify where to draw the demarcation line between freedom of expression and incitement” said the UN High Commissioner for Human Rights, Navi Pillay.
 
“In recent years, incidents involving hate speech, negative stereotyping in the media, and even advocacy of religious or national hatred by public officials and political parties have resulted in killings of innocent people, attacks on places of worship and calls for reprisals.
 
This spiral of violence has made it incumbent on us to renew the search for the correct balance between freedom of expression — which is among the most precious and fundamental of our rights as human beings — and the equally vital need to protect individuals and communities from discrimination and violence” she added.
 
The Rabat Plan of Action on the prohibition of advocacy of national, racial or religious hatred that constitutes incitement to discrimination, hostility or violence (PDF) recommends the adoption of comprehensive anti-discrimination national legislations with preventive and punitive action to effectively combat incitement to hatred, as well as the empowerment of minorities and vulnerable groups.
 
Evoking the complex equation between free speech and protection from incitement, Pillay acknowledged that views on this issue diverge greatly, with some calling for much tougher restrictions on permissible expression (…) while others have maintained that freedom of expression should be near-absolute, pointing out that laws limiting speech are very often misused by authorities to muzzle critics and silence dissent.
 
The High Representative of the Alliance of Civilizations, Jorge Sampaio, welcomed the Rabat Plan of Action, which presents a set of practical recommendations to States, the UN system, political and religious leaders, the civil society and the media, and underlined the key role to be played by education to change mindsets.
 
“National and local authorities can exacerbate the severity of the speech, but they have also the potential to counter hate speech through positive speech and messages of tolerance and restraint” declared the UN Special Advisor on the Prevention of Genocide, Adama Dieng, when evoking the role of the State, religious and local authorities, education institutions and the media.
 
Regarding the role of legislation, Dieng recognized that it was important but limited, and advised for a “multilayered approach for prevention”.
 
Among the key factors put forward in the Rabat Plan of Action to prevent incitement to hatred are the collective responsibility of public officials, religious and community leaders, the media and individuals, and the need to nurture social consciousness, tolerance, mutual respect, and intercultural dialogue.
 
The Plan of Action also contains a six-part threshold test for forms of speech that are prohibited under criminal law. The test takes into consideration: the context of incitement to hatred, the speaker, intent, content, extent of the speech, and likelihood of causing harm.
 
Furthermore, education on pluralism can also contribute to prevent incitement to hatred, intolerance, negative stereotyping, stigmatization and discrimination on the basis of nationality, ethnicity, religion or belief, according to experts.
 
“It is the first time when a joint action to establish a synergy among the work of several human rights mechanisms, treaty bodies and special procedures, —including on freedom of opinion and expression, freedom of religion, and racism—independent experts, and non-governmental organizations, results in the adoption of a comprehensive plan of action on a cross-cutting important aspect of human rights law: the delimitation of boundaries between free speech and hate speech”, says Ibrahim Salama, Director of the Human Rights Treaties Division at OHCHR. The Plan of Action presented today was adopted at a meeting convened by the UN Human Rights Office (OHCHR) in Rabat, Morocco, in October 2012.
 
The Rabat meeting aimed at wrapping-up discussions and recommendations made since 2011 at four regional workshops to assess at national and regional levels legislative patterns, judicial practices and policies on incitement to national, racial or religious hatred.
 
The consultative process that led to the adoption of the Rabat Plan of Action involved three UN Special Rapporteurs (Frank La Rue, Special Rapporteur on Freedom of Opinion and Expression; Heiner Bielefeldt, Special Rapporteur on Freedom of Religion or Belief, Adama Dieng; Mutuma Ruteere, UN Special Rapporteur on Racism, Racial Discrimination, Xenophobia and Related Intolerance), Agnes Callamard, Executive Director of Article XIX, as well as 45 experts from different cultural backgrounds and legal traditions. Regional workshops were held in Europe (Vienna, 9 - 10 February 2011), Africa (Nairobi, 6- 7 April 2011), Asia and the Pacific (Bangkok, 6 - 7 July 2011), and the Americas (Santiago, 12 - 13 October 2011).
 
Building on the Rabat Plan of Action, the three UN Special Rapporteurs involved in the regional consultations will co-host in Geneva, on 22 February, a seminar to identify policy options for stopping and preventing incitement to atrocity crimes in situations where violence is imminent.
 
* Visit the link below to access the report.
 
Feb 2013
 
U.N. to Build Bridges Battling “Merchants of Hate”, by Thalif Deen. (IPS)
 
Amidst the rising tide of racial and religious intolerance worldwide – including xenophobia, anti-Semitism and Islamophobia – the U.N. Alliance of Civilizations (UNAOC) will meet in the Austrian capital of Vienna later this week to strengthen cross-cultural relations in a world it describes as “alarmingly out of balance”.
 
In our inter-connected information age, says Secretary-General Ban Ki-moon, “we may not be able to prevent every merchant of hate in every corner of the world.
 
“But we can build bridges that are strong enough to withstand those forces,” he adds.
 
The television cameras focus on the fringe. The extremists gain easy publicity with their bonfires of bigotry.
 
And the task of constructing those bridges is one of the primary responsibilities of UNAOC, which holds its Fifth Global Forum aimed at “Promoting Responsible Leadership in Diversity and Dialogue.”
 
The last four Forums were held in Madrid, Spain (2008), Istanbul, Turkey (2009), Rio de Janeiro, Brazil (2010) and Doha, Qatar (2011).
 
The Vienna Forum, scheduled to take place Feb. 27-28, will be the first to be headed by the new High Representative of UNAOC Nassir Abdulaziz Al-Nasser of Qatar, a former president of the U.N. General Assembly and chairman of the Board of Directors of Inter Press Service (IPS) news agency.
 
Asked about the most effective way of remedying the growing malaise, UNAOC Director Matthew Hodes told IPS intolerance and discrimination have been a sad, unacceptable part of the human experience, and may never be completely eradicated.
 
“What the international community can do, what U.N. bodies have and will continue to do is maintain the fight against these scourges,” he said.
 
Whether it is by setting standards through international instruments, vigilant reporting of abuses of those standards, or proactive efforts at reconciliation, “We all have a role to play in that fight,” he added.
 
Meanwhile the spread of hate crimes has also been attributed to sensational coverage by the international news media.
 
When the United Nations commemorated International Day of Peace last September, the celebrations were marred by news of widespread rage in the Islamic world, a continued bloody civil war in Syria, suicide bombings in Iraq and Afghanistan and violent demonstrations in Pakistan, Indonesia and Bangladesh against a video caricaturing the Prophet Muhammad.
 
In his address, the secretary-general warned that the world was facing global protests and violence in response to another ugly attempt to sow bigotry and bloodshed.
 
But he also directed his jabs at the media. In today’s world, he said, the loudest voices tend to get the microphone.
 
“The television cameras focus on the fringe. The extremists gain easy publicity with their bonfires of bigotry,” he said.
 
Navi Pillay, the U.N. High Commissioner for Human Rights, was equally unhappy with the news coverage when she said the best way to deal with provocations, including religious intolerance, was to ignore them. But the news-conscious media doesn’t.
 
Asked whether the press is a contributory factor to the current state of hate crimes through sensationalism in news reporting, Hodes told IPS, “The societies in the world that are the most free are also those with the most unfettered media.”
 
He pointed out that those who work in the media are subject to professional standards set in each country: standards that when followed tend to ensure responsible reporting.
 
“And let’s be clear: when I speak about vigilant reporting of abuses I am speaking not only of international civil servants but the media as well,” he added.
 
Hodes said the media has a central role to play in increasing the public understanding of sensitive issues, including religious intolerance, migration and diversity.
 
All of these factors can contribute to polarising communities.
 
“The UNAOC tries to address this challenge by regularly convening editors, media owners and experts to establish a platform for dialogue leading to concrete recommendations,” said Hodes. “And we aim to organise a meeting around religion and religious intolerance in the year to come.”
 
Asked about a proposal for an international convention against Islamophobia, one of the most widespread of religious intolerances, he said: “While I would not comment on any particular proposed convention it is apparent that an agenda of fear has taken root in certain parts of the world”.
 
But that cannot justify the vilification of an entire religion or its adherents, he added.
 
“Islamophobia is a real phenomenon in certain places and must be addressed,” Hodes said.
 
A concept paper jointly prepared by the UNAOC Secretariat and the Austrian Federal Ministry for European and International Affairs, which will be discussed at the Vienna Forum, will focus on how responsible leadership can make a difference in the following three major issues:
 
First, promotion, protection and full enjoyment of the right to religious freedom in a context of religious pluralism which consists not only of greater diversity, but also of perceptions of that diversity and new patterns of interaction among religious groups;
 
Second, media pluralism and diversity of media content and their contribution to fostering public debate, democracy and awareness of diverse opinions;
 
Third, shaping a new narrative for migration, integration and mobility in the global economy.
 
* U.N. Alliance of Civilizations http://www.unaoc.org/


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