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Friday, 29 May 2009

Robert Mugabe as COMESA’s new poster boy bodes ill for trade in Africa

The 13th Common Market for Eastern and Southern Africa (COMESA) Summit postponed twice since 2008 due to Zimbabwe’s political instability, is ongoing with preliminary ministerial meetings. The Heads of State summit is set to commence on June 6th where Robert Mugabe will officially take over the helm of the trading bloc from Kenyan President Mwai Kibaki.

According to COMESA’s vision, the regional union is meant to “be a fully integrated, internationally competitive regional economic communitywith high standards of living for ALL its people”. COMESA’s chosen approach to achieve this is through development integration involving a combination of trade development and investment promotion.

Mugabe: The Right Man For The Right Job?

At a time when Africa has been hit hard by the worst global recession, it is inconceivable that a man who single-handedly crushed his own country’s economy can be placed in a position over the economies of 19 member states with a population of over 400 million.

Mugabe has ruled Zimbabwe with an iron fist for the past 29 years. His past actions are in stark contrast to the bloc’s Fundamental Principles as enshrined in the COMESA Treaty which include the recognition, promotion and protection of fundamental human rights; commitment to the principles of liberty, fundamental freedoms and the rule of law; maintenance of peace and stability through the promotion and strengthening of good neighbourliness and promotion and sustenance of an accountable and just democratic system of governance.

However, the Mugabe hegemony has overseen countless lives being lost most recently from cholera which even spread across borders. Torture and extra judicial killings to muzzle opponents have also been widely used with the Zimbabwe Human Rights NGO Forum reporting more than 20,000 human rights violations including 3,000 acts of torture since 2001. Average life expectancy in the country since 1998 has fallen from 55 years to a paltry 35, in essence meaning that a Zimbabwean has a strong chance of not outliving their youth. Unemployment remains rife with over 90% of the working age population being jobless. Maternal and child health has degenerated to the point where nearly half of all Zimbabweans are at risk of malnutrition and starvation, and a child born in Zimbabwe is the most likely to die in the entire African Continent.

All this misery led to over a quarter of Zimbabwe’s populace fleeing the terror and misery. Yet Mugabe remains to this day either unrepentant or maybe unaware of the devastation he has wreaked on his country. He has numerously been quoted pointing fingers blaming his people’s woes on the British, Americans and any country he perceives to be at fault. Individual Zimbabweans who dare to question his policies have been branded as puppets of the West, overlooking the fact that he as well as his coterie of greedy associates have over the years looted the Treasury and in turn messed what was once seen as the breadbasket of Africa.

As a report The Zimbabwe Papers: A Positive Agenda for Zimbabwean Renewal concluded, the crisis situation in Zimbabwe is solely due to "policies adopted, decisions made, and actions taken by the government of Zimbabwe" – the ZANU-PF government of Robert Mugabe.

Nothing except for a fragile unity government has changed since November 2008 when the majority of COMESA heads of state who had been invited to attend the postponed summit, categorically told the Zimbabwe government of the day that they would boycott the summit.

Robert Mugabe does not stand for the promotion of trade. Hyperinflation and excessive government regulations have heavily penalised the country’s entrepreneurs. Hyperinflation reached a mind-boggling 231 million percent. His accomplice in looting state funds, Central Bank Governor Gideon Gono remains in office. Mugabe even had the temerity to declare that his lieutenant Gono would remain in office up until he leaves office come 2013.

On the authority of Mugabe, Zimbabwe’s Central Bank exercised imprudent monetary policies which included flagrant printing of money regardless of the impact on inflation and the ordinary Zimbabwean. Fiscal policies enforced punitive lump taxes on businesses, further hampering the chances of success for enterprises. Criminality and corruption were the order of the day, with embezzlement, kidnappings and all other manner of vile strategies being used in order to retain control.

The country’s standard of living fell by 80% in the last decade. Even the local Zimbabwe dollar has been suspended. Public utilities were progressively canibalised till the water system became contaminated, electricity erratic and fuel became so scarce that it's market value became akin to gold. Workers in industries were similarly punished when even their health became compromised as a result of a health sector that could no longer provide even the most basic essential drugs.

According to the Ease of Doing Business reports from the World Bank’s International Finance Corporation, it takes 96 days to start a business, 481 days to comply with licences and another 30 days to register a property. Zimbabwe also currently ranks 7th worst on the World Bank’s Trade Restrictiveness Index.

The years of destruction of social goods now means that Zimbabwe needs at least US$5 billion to revive its almost dead economy. Local industry which should be in the forefront of re-energising the economy virtually collapsed under Mugabe’s totalitarian regime. Production costs are hardly competitive within the COMESA region let alone the rest of Africa. The Zimbabwe papers report laments that Zimbabwe has become one of the worst places to start a business. So how can the same person responsible for this degeneracy promote trade? It beats belief.

As the Corporate Foreign Policy blog writes: Mugabe has created a situation so horrible that if he ever got to the Hague, they would need to invent a new charge for the man.

Though Zimbabwe’s economy has slowly revived after Mugabe and Morgan Tsvangirai formed a coalition government, a lot remains to be done. However, you cannot be part of a problem as well as part of the solution.

Why is it that the donor community is placing conditionalities on loans such as respect for human rights and the rule of law on Zimbabwe, yet COMESA whose basic tenets rest on the same principles cannot insist that Zimbabwe implements such measures? To elect such an individual, calls into question COMESA’s mission and role in improving the living standards of the over 400 million Africans it serves.

Thursday, 28 May 2009

IMF, World Bank & Lending Institutions: Agents Promoting Poverty or Development? By Lord Aikins Adusei

According to The World Bank, it is, “a vital source of financial and technical assistance to developing countries around the world. We are not a bank in the common sense. We are made up of two unique development institutions owned by 184 member countries—the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA). Each institution plays a different but supportive role in our mission of global poverty reduction and the improvement of living standards. The IBRD focuses on middle income and creditworthy poor countries, while IDA focuses on the poorest countries in the world. Together we provide low-interest loans, interest-free credit and grants to developing countries for education, health, infrastructure, communications and many other purposes."

The above statement of claim taken from the World Bank website contains half truth. Yes it is true that in theory the World Bank would like to reduce global poverty but in practice it is the opposite. The fact still remains that both the Bank and the IMF have done very little to help the world´s poor rather their condition has been worsened by the past and present behaviour of the Banks. There is little evidence to back the claim of both institutions that they are a vital source of financial and technical assistance to developing countries. The World Bank may be a vital source of financial assistance to the corrupt regimes in these poor countries and not to the poor. There is no evidence to suggest that the poor people from third world countries have benefited from loans given to their governments. At best what the Bank and IMF have helped the poor countries to do is to build up massive debts that they may never be able to pay.

Third World countries including the whole of Africa have incurred trillions of dollars in debts through loans contracted from the Bank, IMF and Western governments which the people who now wallow in utter poverty, never benefited. Most of these conditional loans were either stolen or used to service debts already owned by these poor countries. Part of the loans were also used to pay foreign expatriates supplied to the poor countries by IMF, World Bank as ´technical experts´ but whose contribution is the result of poverty seen in the third world. Again the loans were used to prop up corrupt regimes who diverted the funds to their private bank accounts in Switzerland, France, Britain, Liechtenstein and Luxembourg and Austria among others.

In 2006 for example, developing countries owed $3.7-trillion in odious debt, servicing more than $570-billion per annum. An analysis by economist James Henry revealed that more than $1-trillion worth of loans "disappeared into corruption-ridden projects or was simply stolen outright". Out of this debt Africa owes $200 billion and uses $14 billion annually to service it, money that could be used to provide education, healthcare other basic needs for  the people. The over $200 billion that African countries owe to foreign creditors represents a crippling load that undermines economic and social progress. The all Africa Churches Conference says this debt and its servicing represent "a new form of slavery, as vicious as the slave trade".

The servicing of such massive debts has brought untold and worsening economic hardships to the poor as third world governments have been forced to freeze investments in education, health, transport, agriculture, housing, sanitation and other vital infrastructures. Evidence of this hardship are chronic poverty, malnutrition, diseases, starvation, hunger, decaying and inadequate infrastructures and economic failures seen everywhere in the developing world. The sad aspect of these debts servicing is that the current generation who are paying for it never requested it nor benefited from it in anyway. The debts were incurred at a time when these countries did not even need loans yet World Bank, IMF and Western governments encouraged them to go for it.

Africa Action a Not for Profit Organisation says, "The albatross of illegitimate debt diverts money directly from spending on health care, education and other important needs. While most people in Africa live on less than $2 per day, African countries are forced to spend almost $14 billion each year servicing old, illegitimate debts to rich country governments and their institutions, the World Bank and the International Monetary Fund (IMF). Over the past two decades, African countries have paid out more in debt service to foreign creditors than they have received in development assistance or in new loans. Much of Africa's foreign debt is illegitimate in nature, having been incurred by unrepresentative and despotic regimes, mainly during the era of Cold War patronage. Loans were made to corrupt leaders who used the money for their own personal gain, often with the full knowledge and support of lenders. These loans did not benefit Africa's people. More generally, many Africans question the notion of an African "debt" to the U.S. and European countries after centuries of exploitation. They ask, "Who really owes whom?"Yet, despite the social and economic costs of this massive outflow of resources from the world's poorest region, the wealthy creditors of Africa's debts continue to insist these debts be repaid." Source /campaign_new /debt.php

Joseph Hanlon of Jubilee Research UK gives details to what happened to monies loaned to Mobutu of former Zaire now DR.Congo. He says: "Much of poor country debt is related to the Cold War, when both sides pushed money at their supporters. Zaire's ruler, Mobutu Sese Seko, was one of the world's most corrupt leaders and it was for his government that the word kleptocracy was first coined. Mobutu became one of the world's richest men, with a personal fortune estimated at more than $10 billion owning palaces in Europe and Zaire. But the West saw Mobutu as a loyal ally in the Cold War (in part for his support of the US, in its backing for UNITA in Angola). In 1978 the IMF appointed their own man, Edwin Blumenthal, to a key post in Zaire´s central bank. He resigned two years later, complaining of "sordid and pernicious corruption" that was so serious that "there is no chance, I repeat no chance, that Zaire's numerous creditors will ever recover their loans." And look what happened after this report.

Shortly after Blumenthal's report to the IMF, it gave Zaire the largest ever loan given to an African country. When Blumenthal wrote his report, Zaire's debt was $5 billion; by the time Mobutu was overthrown and died in 1998, the debt was over $13 billion. In the six years after Blumenthal's report, the IMF lent Zaire $600 million and the World Bank $650 million. In those six years Western governments lent Mobutu nearly $3 billion.

About 50% of the $13-billion was stolen and deposited in Western Banks notably Switzerland and France while the rest was wasted on white elephant projects that never solved the poverty problem in the country. Today majority of Congolese live on less than a dollar a day while hundreds of millions of dollars are paid to the IMF and World Bank every year as fees for loans taken and stolen by Mobutu.

In another classic example, the World Bank lent Indonesia a total of US$30 billion in the course of General Suharto's three decades of rule. In 1998, World Bank resident staff in Indonesia estimated that: "at least 20-30 per cent of GOI [Government of Indonesia] development budget funds are diverted through informal payments to GOI staff and politicians, and there is no basis to claim a smaller 'leakage' for Bank projects as our controls have little practical effect on the methods generally used". That means by the Bank's own account that up to US$9 billion of World Bank loans to Indonesia were wasted through corruption and that World Bank staff knew it. And they did absolutely nothing to stop the corruption. Today the poor people of Indonesia are still paying for the billions of dollars wasted before the eyes of IMF.

In Philippines during the regime of the dictator Ferdinand Marcos, the Bank and IMF were absolutely aware of the fact that most loans to Philippines were transferred into the bank accounts of Ferdinand Marcos and his generals; nevertheless they considered it as a necessary bribe for paying the political staff in power in order to ensure the acceleration of the neoliberal counter reform. As a result World Bank lent Marcos $400m in 1980; $251m in 1982 and $600m in 1983 and Marcos deposited the money in his accounts in Switzerland. So far the Philipinos are still paying for the policies of the Bank and IMF.

Dr. Susan Hawley author of  Exporting Corruption has written extensively about how loans taken and diverted into private banks by Ferdinand Marcos have gruesomely affected Philippines´ development and her quest to reduce poverty. She says: "The US company, Westinghouse won a contract in the early 1970s to build the Bataan nuclear plant in the Philippines. It was alleged that Westinghouse gave President Ferdinand Marcos US$80 million in kickbacks. The plant cost $2.3 billion three times the price of a comparable plant built by the same company in Korea. Filipino taxpayers have spent $1.2 billion servicing the plant's debts even though the plant has never produced a single watt of electricity because it was built at the foot of a volcano near several earthquake faultlines. The Philippine government is still paying $170,000 a day in interest on the loans taken out to finance the nuclear plant and will continue to do so up to the year 2018. A Philippino Treasurer Leonor Briones recently commented on the loans: "It is a terrible burden which never fails to elicit feelings of rage, anger and frustration in me. We're talking of money that should have gone to basic services like schools and hospitals". Source: Dr. Susan Hawley.

Patricia Adams, executive director of Probe International, in her book Odious Debts estimates the Philippino dictator, Ferdinand Marcos, and his wife Imelda, pocketed literally one-third of the Philippines' entire borrowing – much of it in the form of kickbacks and commissions on aid and loan-funded projects. His personal wealth when he was overthrown was $10 billion. Source:

The behaviour of the two Banks and other lending institutions to prop up corrupt regimes explains why after 50 years of loans there has not been any appreciable reduction in poverty levels world wide and especially in Africa. As I said the best the two Bretton Woods institutions have done is to help the poor countries to build massive debts and increase poverty. Today majority of the 945 million Africans (70%) live on less than two dollars a day meanwhile hundreds of billions of dollars have been loaned to their corrupt leaders and there is nothing to show for it.

James Wolfensohn, Ex-World Bank President seems to disagree and says: "As a public institution we are accountable for helping our borrowers to see that the money allocated under Bank-financed operations is being spent on what it should be spent on and that our borrowers are getting good value for what is being spent". But how does Wolfensohn reconcile his statement with reports regarding loans to dictators in Africa, Asia and South America that produced nothing but poverty? The question is has the billions of loans and aid to third world countries change anything for the poor people in those countries? Can Wolfensohn say with empirical evidence that countries that have borrowed money from the Bank got value for the money? I do not think so. There is no evidence to suggest that IMF and World Bank even made the effort to ensure the people benefited from the loans and there is no evidence to prove that both institutions made effort to recover the money from Mobutu, Suharto, Marcos, or the Banks in Switzerland after it became obvious the dictators had stashed the money in foreign Banks. The two mega banks did not make any effort because they knew future generations cannot afford to refuse to pay as that will be a stain on their credit worthiness. But how fair is it to ask people to pay for things they or their country never benefited?

Instead of being agents of growth, development and helping to fight poverty, what the two institutions and their western political masters have done so far is to entrench poverty, diseases, hunger, starvation and malnutrition in these poor voiceless countries. The pressure on the poor countries to meet their debt obligations has forced many of them to use scarce resources to service these debts to the detriment of their economies and their peoples. If indeed the Bank and the IMF are committed to reducing poverty why would they loan money to corrupt regimes or refuse to take responsibility for the failures of their own policies and actions? Why would they help poor countries to build massive debts only to wash their hands off the debt? And why should poor Africans, Asians and Latinos be made to pay the odious and illegitimate loans that they never benefited? Why should poor African and third world countries be made to take responsibility for the failures of IMF and the Bank´s ill conceived policies that have brought misery and untold hardships to the poor? Who should take responsibility for these odious and illegitimate debts is it the Bank who loaned out of negligence and without due diligence or the people who never benefited?

To ask these poor countries to continue to pay these debts is not only unfair but morally not justified. Poor countries should stop paying these odious and illegitimate debs unless the IMF and the World Bank can prove that the people benefited from it. World Bank and IMF were wilful accomplices to the loot, corruption and mismanagement that took place during Mobutu, Suharto, Marcos, Lansana Conte regimes and which are being repeated by the corrupt regimes of Obiang Nguema, Denis Sassou Nguesso, Gaddafi, Hosni Mubarak, Omar Bongo, Obiang Nguema and Blaise Campore. If lending institutions fail to demand proper accountability from these corrupt rulers then it would be unlawful and improper to ask future generations to pay for the sins of their rulers.

 When consultants Morgan Grenfell urged against the sale of the Uganda Commercial Bank, the World Bank and IMF insisted the sale go ahead. Sold to a Malaysian engineering consortium linked to the brother of the Ugandan president, the bank had to be re-nationalised in 1998 "after running into trouble giving out millions of dollars worth of dubious loans". According to the head of Uganda's privatisation unit, "When [the sale of Uganda Commercial Bank] went bad", the World Bank "disappeared off the radar screen" and refused to take any responsibility for it. Source:

Apart from their support for corrupt regimes, the Bank and IMF prescriptive policies have also played a huge role in entrenching poverty in the third world. Worth mentioning are the structural adjustment programme and trade liberalisation which were sold to the poor countries by these financial institutions and supported by the western economic saboteurs. The fact is that the SAP and trade liberalisation among others were ill formulated, implemented and monitored with the results that countries that embraced them have all lived to regret.

The SAP forced onto poor third world countries by the Bank and the IMF forced their governments to abandon their support for the public sector with serious devastating consequences to the health, education and agric sectors. The withdrawal of farm subsidies in particular made it difficult for farmers to produce to support local consumption or compete with their rich Western counterparts who receive billions of dollars of government subsidies every year. The unrests and disturbances over food shortages and high food prices that occurred in Egypt, Haiti, Ivory Coast, Liberia, Mauritania, Indonesia, Afghanistan, Eritrea, Somalia and Sierra Leone in 2008 were the direct result of the Bank and IMF bitter pills prescribed to these poor countries.

Trade liberalisation required the poor countries to privatise or close down certain companies, opening up the economy to foreign goods, reforming economic policy, liberalising labour market, eliminating subsidies, and environmental regulations, eliminating set prices for producers and consumers, increasing exports, cutting government expenditures and giving foreign multinationals free hands to do as they wish often to the detriment of the countries concerned. The cost of trade liberalisation to third world countries is estimated to be $300-billion.

The sad aspect of this exercise is that almost all the companies that were sold went to foreigners and cronies of corrupt government officials and the proceeds stolen or used to service debts already owned by these poor nations. This policy also led to closure of a number of factories, and decline in agriculture output that were sources of livelihoods to hundreds of millions of families. The mention of this retrenchment exercise always brings painful memories to millions who lost their jobs and had to live a life of squalor without any help or whatsoever from their governments.

Also the Bank and the IMF tax and trade policies towards these poor countries always put them at a disadvantage positions when dealing with multinational corporations. Many poor countries are forced to grant tax concessions to multinational corporations as a favour for investing in the third world economies. These concessions include instituting secrete memorandums of agreement, subsidies to foreign corporations and massive tax concessions (such as income tax, usage fees, property tax) which are the primary source of revenue for export-oriented developing countries.

How do you fight poverty when rich companies are made to pay close to nothing for raping countries of their natural resources? Why wouldn´t poverty increase and people die of starvation, hunger and diseases when money meant for development are used to service debts for which the people never benefited?

In an article by Khadija Sharife entitled Capital Flight: Gingerbread Havens, Cannibalised Economies she wrote: "The IMF and World Bank tax policies towards the developing world is very lethal especially where the poor are now caught in tax brackets, courtesy of the IMF and World Bank´s structural adjustment programmes (SAP), instituting policies ranging from tax holidays to the privatisation of state services, carving out huge slices of natural capital at corporate auctions. Africa has collectively lost more than $600-billion in capital flight, excluding other mechanisms of flight such as ecological debt (globally estimated at a potential $1.8-trillion per annum). Thus with the support and collusion of IMF and the Bank, poor countries are loosing billions of dollars in revenue to rich multinational corporations.

The unflinching support that the Bank and the IMF give to multinational corporations against the wishes of third world governments is another reason why poverty is still rampant in Africa and elsewhere. For example, in 1998 the Pakistani anti-corruption agency investigated over 20 Western companies for paying kickbacks to Benazir Bhutto's government for public contracts to provide electricity. Six of the companies later confessed to offering bribes. Instead of receiving support from Britain, France, the US, IMF, World Bank and other Western governments they were told to quash the investigation on the grounds that investors would shy away from Pakistan. The IMF even made a package of loans conditional on the government dropping the charges against the companies involved. In the end Pakistan had no choice but to stop the investigations.

It is on record that about 45% of all World Bank project contracts go to multinationals in the US, Germany and Britain why? Why not companies in these poor countries where the projects take place and who finally end up paying for the projects?

But it is not surprising that these multinational financial institutions behave the way they did. Both institutions only acknowledged in 1996 the role corruption plays in entrenching poverty after more than 50 years in existence. Why did they continue to loan to the dictators after mounting evidence that they were looting the loans? Why did it take World Bank 50 years to recognise the devastating impact corruption was having on the world´s poor? Could it be that both institutions are corrupt themselves?

Dr. Jeffrey Winters of Northwestern University says, "The World Bank has participated mostly passively in the corruption of roughly $100 billion of its loan funds intended for development." Other experts estimate that between 5 percent and 25 percent of the $525 billion that the World Bank has lent since 1946 has been misused. This is equivalent to between $26 billion and $130 billion. Even if corruption is at the low end of estimates, millions of people living in poverty have lost opportunities to improve their health, education, and economic condition".

And Sen. Richard G. Lugar speaking about corruption in the World Bank and its impact in fighting poverty said, "Corruption thwarts development efforts in many ways. Bribes can influence important World Bank decisions on projects and on contractors. Misuse of funds can inflate project costs; deny needed assistance to the poor, and cause projects to fail. Stolen money may prop up dictatorships and finance human rights abuses. Moreover, when developing countries lose development bank funds through corruption, the taxpayers in those poor countries are still obligated to repay the development banks. So, not only are the impoverished cheated out of development benefits, they are left to repay the resulting debts to the banks."

In fact, allegations of corruption at the Bretton Woods institutions are as old as the institutions themselves. In 1994, marking the 50th anniversary of its creation at Bretton Woods, South End Press released "50 Years is Enough: The Case Against the World Bank and the International Monetary Fund," edited by Kevin Danaher. The book details official Bank and IMF reports that reveal the same kind of corruption and embezzlement back then. In addition, it revealed different types of corruption, for instance, "Beyond the wasted money and the environmental devastation, there was an even more sinister side to the Bank during the McNamara years: the World Bank's predilection for increasing support to military regimes that tortured and murdered their subjects, sometimes immediately after the violent overthrow of more democratic governments.

In 1979, Senator James Abourezk (D-South Dakota) denounced the bank on the Senate floor, noting that the Bank was increasing 'loans to four newly repressive governments [Chile, Uruguay, Argentina and the Philippines] twice as fast as all others.' He noted that 15 of the world's most repressive governments would receive a third of all World Bank loan commitments in 1979, and that Congress and the Carter administration had cut off bilateral aid to four of the 15 --Argentina, Chile, Uruguay and Ethiopia -- for flagrant human rights violations. He blasted the Bank's 'excessive secretiveness' and reminded his colleagues that 'we vote the money, yet we do not know where it goes." There is no doubt the money was stolen by the corrupt government officials and dictators who received the money. But the sad thing is that the Bank and IMF have failed to take responsibility for their actions pushing the blame on the poor countries and their poor people who never benefited from it.

Fifty years of loans to the world´s poor and fifty years of extreme poverty and odious debt among the world´s poor. It is as if the World Bank has guided these countries into poverty rather than fight poverty. Can we say these mega financial institutions are truly there to help the world´s poor fight poverty or they serve a higher authority whose aim is to keep the world´s poor in debt and in poverty as Jenkins pointed out is his book 'The Confessions of Economic Hit Man'? That is in reality do the Bank and IMF promote poverty or development?

By Lord Aikins Adusei

The Author is a political activist and anti-corruption campaigner.

Kenyan political scion attempts to hijack the country's youth movement

Following an announcement of the formation of a national youth group spearheaded by Jimmy Kibaki first son of Kenya's President, existing youth and councils registered their consternation.

Below is a press release on the issue from the National Youth Convention

For Immediate Release
Nairobi: Thursday May 28th 2009

Jimmy Kibaki, Tonny Gachoka and Kiema Kilonzo do not speak for the Youth Movement.

In September of 2008, 1300 delegates from all the eight provinces of Kenya  created the National Youth Movement at the National Youth Convention. 14 Key resolutions were passed and has been actively recruiting and implementing them through members across the country and at the national level. The National Youth Movement is active and will deliver results as per to the aspirations of the young people who legitimately formed it.

The NYC was represented at the Inter Ethnic youth Forum at the Jumuia Conference Center in Limuru. The Action Plan adopted by the 170 representatives of the different ethnic groups from across Kenya will and forms part of the outreach programmes that is under implementation. NYC supports the efforts of the Inter Ethnic Forum and stands by its action plan.

Jimmy Kibaki, Tonny Gachoka and Kiema Kilonzo were invitees to the National Youth Convention and gave the convention a wide absence. As such they were never elected to represent the National Youth Movement. The NYC notes with grave concern that after Kiema Kilonzo un-invited at the Inter Ethnic Dialogue showed up and after noting that the US Government and other development Partners were keen to work with youth in Kenya, he is conspiring with others (Jimmy and Tonny) to hijack the Youth Movement’s Agenda for short term political gains. The trio does not have a following and no track record of working for the youth development in Kenya and therefore a cheap political outfit that will expire immediately after the next general election.

The National youth Movement therefore recommits its force and following from across the country on the resolutions as passed by delegates from all the 210 constituencies and welcomes all partners working in the youth development arena to supporting the youth agenda in Kenya
We caution all the Development Agencies against working with rogue politicians purporting to be committed on the youth agenda.

The National youth Movement will continue to watch out for the youth of Kenya in persisting for the mainstreaming and promoting of their visibility and voice in the national agenda. While every Kenyan has a right to work and organize young people for any noble cause, we take exception for politicians who want to use young people and dump them after they are done with their short term political agenda.

Signed for and on behalf of the National Youth Convention.

Emmanuel Dennis Ngongo - Convener

CC: All Development Partners and Foreign Missions in Kenya

Monday, 25 May 2009

Why Are We Still Poor?

Why Are We Still Poor?

ActionAid är en religiöst och partipolitiskt oberoende organisation som arbetar för att bekämpa fattigdom.

Look at the woman in the above picture and her surrounding carefully. Does she look like someone who has been given help by Aid Agencies like United  States Agency for International Development (USAID), Danish International Development Agency (DANIDA), Canadian International Development Agency (CIDA), Swedish International Developmet Agency (SIDA), Oxfam, Action Aid, Christian Aid, Advenstist Development and Relief Agency (DRA)? Does she look like someone whose government has received billions of dollars in loans from the World Bank or the IMF? Does she look like someone who has received financial or material help from US, Japan, Germany, Britain, France or Italy? Does she look like someone whose government receives billions of dollars in revenue from gold, oil, gas, coltan, diamond, timber, cocoa, cotton, tea, coffee, bauxite and uranium every year? What has happened to all the aid money or the IMF and World Bank loans or aid and grants from US, Japan, European Union and the revenue from the natural resources? In short why are the people so poor when Aid Agencies are helping them every day; when the world Bank and IMF give them loans every day; and US, Japan, Britain, Germany and others give aid and grants to the people every year? Who has benefited from all these monies? Could it be the donors and aid agencies themselves or the politicians who sometimes receive the money on behalf of the people? 

Why are we poor? This is a troubling question. I cannot understand why after so many years of aid and big loans Africa still sits at the bottom of the world's progressive continents. There are so many Aid and Humanitarian Agencies in Africa claiming to be helping the people to alleviate poverty but fifty years on Africans still wallow in object poverty. Why? Could it be that the Aid Agencies are not doing any work? Could it be that the Aid Agencies only cry for attention without necessarily doing anything to help the poor? Or could it be that the aid agencies use the plight of the people to raise money and then use the money to pay their staff fat salaries and bonuses and hold big parties without necessarily using the money to help the poor?

The World Bank and IMF claim to provide vital financial support to poor countries to help them alleviate poverty but more than fifty years of loans to these poor countries poverty is still decimating them. So what happened to all the billions of dollars that the World Bank and IMF claim to have provided to the world's poor? Could it be that the Bank and IMF give the loans and then turn round to force these poor countries to use it to service old debts? Could it be that the Bank and IMF give the loans to corrupt regimes who then deposit the money in their private banks in Europe and then ask the poor people who never benefited from the loans to use the little resources they have to service the debts? Could it be that the loans are given with conditions that benefit the creditors and not the countries who borrow the money? Can the World Bank and IMF explain to the World why so many poor countries remain poor after they had received tens of billions of dollars from them?

Every year United States, Japan, the European Union, Germany, Britain, France and Italy claim to give millions of dollars to the poor countries in the form of loans, grants and what have you. But we still have not seen poverty going down or stabilising. What has been happening to the aid money that US, Japan and Europe claim to have been given to third world countries? Who receives those monies and what do they use the money for? How has the ordinary people benefited from the grants and aid? If so much has been received then so much should have been done to reduce poverty isn't it?

Every year African countries receive tens of billions of dollars from the sale of oil, gas, diamond, gold, bauxite, coltan, timber, cocoa, tea, coffee, cotton and many others. What has happen to all the money? Could it be that the money has been wasted on white elephant projects? Could it be that the money is stolen out right by corrupt politicians, the business elite and their cronies in Africa? If so could it be that Switzerland, France, Britain may be having a clue as to what has happened to all the money? I mention Switzerland and Britain because their banks have had direct link with all the corrupt regimes that Africa has ever produced from Mobutu, Sani Abacha, Lansana Conte, Eduardo dos Santos, Bakili Muluzi, Paul Biya and Blaise Campore to Ibrahim Babangida. I mentioned France because Omar Bongo of Gabon and his family have are known to have 70 banks accounts plus 59 luxury properties and 8 luxury cars in France alone and Denis Sassou Nguesso of Congo and his family also have 122 bank accounts, 24 luxury properties and a number of luxury cars in France alone not to mention those in Switzerland and other save haven centres. It is only God who knows how much money is contained in 70 and 122 accounts.

How do multinational corporations doing business in Africa pay for the resources that they exploit? And who receive the money they pay? Do multinational corporations declare all the profits they make in the African countries where they operate or they declare just a little and then hide the rest in their save haven accounts in Switzerland, Jersey Island, Luxembourg, Liechtenstein, Austria, Hong Kong, Singapore, Caymans Island and the rest? And how does that deny the poor people the chance to escape poverty? 

If indeed the Aid Agencies, World Bank, IMF, US, Japan, European Union, Britain, Germany, France have given so much then why are we poor? Is it lack of luck or what? I really don't know can someone please help me?

 By Lord Aikins Adusei

The Author is a Political Activist and Anti-Corruption Campaigner


Friday, 22 May 2009

Corrupt Kenyan MP Threatens Political Activist with Death

Mr Simon MbuguaS

Simon Mbugua

Kenyan MP by name Simon Mbugua (pictured above) has sent his bodyguard called Billy to kill a prominent political activist called Fwamba for voicing his opinion about memebers of Kenya's Parliament who are sometimes bribed to vote in a certain way in favour of corrupt ministers. 

This Billy (bodyguard) phoned the the activist 3.36pm Wednesday asking him to meet him with the intention to kill him.

However, the activist refused to meet him fearing his fate will be similar to three political activists who recently lost their lives under misterious circumstances for voicing their opinion on similar issues in the country.

In August 2008 this MP Simon Mbugua was made to stand trial for fraud and theft and his election as MP for Nairobi's Kamukunji Constituency was very controversial.

It must be remembered that Mr. Fwamba was arrested and beaten by Kenyan police for protesting against lack of food and the fact that prices were beyond the reach of many Kenyans.

By this message we want to tell whole world that Mr. Simon Mbugua should be held responsible should anything happens to Mr. Fwamba.

By Lord Aikins Adusei

Sunday, 17 May 2009

Should Europe and North America tear down their Corrupt Financial Infrastructures?

By Lord Aikins Adusei

Anytime Transparency International (TI) releases what it calls corruption perception index (CPI) showing which country is more corrupt and which ones are not the top 10% of most corrupt nations always come from the developing world with most of the so called advanced countries given a clean sheet. TI index always show that countries like Switzerland, Britain, France, Luxembourg, Liechtenstein, USA, Canada, Australia, New Zealand and most of the so called developed nations are less corrupt while those of the developing world are.

However a critical look at what goes on in the world of business and politics show that these so called clean countries and their corporations are more corrupt and do not deserve the accolades that TI gives them.   Countries like Somali, Sudan, Zimbabwe, Nigeria, Bangladesh, Philippines, Haiti, Kenya and Guinea among others feature among the top 10% of most corrupt countries in the world. What TI fails to tell the world is where most of the monies and assets stolen are kept. To tell the citizens of these poor countries that their countries are corrupt and not telling them where the looted funds are, is a great injustice and disservice because these poor people are not interested in how corrupt their countries are, they just want to know where the money has gone.

If TI should concentrate on the origin and destination of looted assets, all the so called clean countries who preach accountability and justice will score nothing but zero. The fact is that most of the monies and assets stolen do not remain in the poor countries where they are stolen; they find their way in western countries and save haven Islands controlled by the West. Western Banks, Car Makers and Real Estate companies have been major recipient of all the stolen assets belonging to the world’s poor.  Bonds, stocks and other assets bought with the money are also kept in western countries.

 Besides TI report does not tell the world how these politicians got corrupted. It is on record that multinational corporations with headquarters in Europe, North America and Japan have established flush funds and using them to bribe third world leaders in order to win contracts.

 For example on 17th September 2002 a Canadian Engineering company called Acres International was convicted by a High Court in Lesotho for paying $260,000 bribe to secure an $8-billion dam contract. Achair Partners a Swiss company and Progresso an Italian company have been accused of bribing Somalia Transitional Government officials to secure contracts to deposit highly toxic industrial waste in the waters of Somalia. 

In 2002 Halliburton a US company, was accused of establishing $180m flush fund and of using it to bribe Nigeria officials in order to secure a $10-billion Liquefied Gas Plant contract. In response to the accusation the company fired Mr. Albert Jack Stanley. Mr. Stanley a former executive of Halliburton (KBR) pleaded guilty for orchestrating the $180m flush fund. Such corrupt practices by western companies seeking contracts in Africa are not uncommon.

Apart from directly bribing the politicians and those in authority to win contracts, these companies also help them to launder the proceeds of their ill-gotten gains in Europe and America.

Global Financial Integrity says, “$900-billion is secreted each year from underdeveloped economies, with an estimated $11.5 trillion currently stashed in havens. More than one quarter of these hubs belong to the UK, while Switzerland washes one-third of global capital flight”. Out of this $900b that is secreted away with the help of Western Banks and companies, $150-billion comes from Africa. 

TI annual report always gives a clean sheet to Switzerland and most of the western nations but Richard Murphy, director of Tax Research LLP says: “The idea that Switzerland has a clean economy is a joke; it is a dirt-driven economy”. But it is not only Switzerland that does not have a clean economy. Britain, France, Germany, Luxembourg, Spain all of which have their own secrecy laws can be described as vampires. Their economies are dirt-driven because most of their financial institutions (a vital sector of their economies) have been implicated in a number of corruption scandals involving corrupt third world leaders and their associates. The Swiss Bankers Association claims that four-fifths of the nation supports banking secrecy laws. This law is the foundation of all the corruption, embezzlement, tax evasions and all the criminal enterprises that we see in the world.

The fact is that those who steal must find a way to hide their loot and the infrastructures and secrecy laws in Switzerland, Luxembourg, Britain, Germany and France make them attractive to criminals and corrupt politicians around the world. Former Iraqi Prime Minister Dr. Iyad Allawi said the late Iraqi dictator Saddam Hussein confessed to stealing $40-billion of Iraqi money and invested it in Switzerland, Germany and Japan.

Switzerland and British economies were the main recipients and beneficiaries of Sani Abacha’s $5-billion embezzlement. When it was discovered that Abacha used the crook banks in these countries to steal the money, Switzerland and Britain wanted to distance themselves from the criminal enterprises run by their banks but in the end had no choice but repatriate over $700-million to the Nigeria government after five years of foot dragging. Only heaven knows how much of Abacha’s loot still remain in these countries.

After 18 years of legal wrangling Switzerland agreed to let the people of Philippines receive the $700m looted by Ferdinand Marcos and kept by her banks. Switzerland kept $700m while children were starving to death and hospitals were closing down for lack of medicines. In the same way Kazakhstan received $84m from Switzerland after her banks had kept the stolen money from this oil rich but economically impoverished country.

Again it took Switzerland 12 years to return $74m of the $110m stolen by Raul Salinas to the government of Mexico. Switzerland still has in her possession the money looted by the dictator ‘Baby Doc’ Duvalier 24 years after he was chased away by the poor people of Haiti.

When Mobutu died in 1997 Swiss newspapers reported that the country may be home to at least $4-billion of Mobutu’s stolen assets. The whole world was shocked when Swiss authorities announced that Mobutu’s stolen assets amounted to just under $8m. The shock sent a chill down the spine of DR. Congo’s president. He has still not recovered and has refused to show any interest in pursuing the money.

So far Switzerland has repatriated $1.6-billion of the money criminally accepted by her banks to its rightful owners but only heaven knows how much still remain in that country. For all their fine words about combating money laundering, corruption, fraud and racketeering, nothing seems to have changed in Europe and America. Omar Bongo, the world’s longest serving head of state, has been implicated for using Swiss and French banks to stash millions if not billions of dollars from his oil rich country including tens of millions of dollars illegally paid by Elf Oil Company.

While Europe and American politicians preach against corruption in the third world they also enact laws which facilitate and promote corruption and embezzlement in the third world.

US Senator Carl Levin says, America cannot have it both ways. We cannot condemn corruption abroad, be it officials taking bribes or looting their treasuries, and then tolerate American banks making fortunes off that corruption. Unfortunately that is exactly what is happening today which is a clear case of double standards. 

“Transparency International brought a case calling on the French justice system to examine how the leaders of Gabon, Congo Brazzaville and Equatorial Guinea and their families could afford to acquire assets worth tens of millions of euros.
The assets include scores of vast apartments and villas and dozens of French bank accounts and cars ranging from Ferraris and Maseratis to Rolls-Royce Phantom.
On Tuesday May 5th 2009, in a landmark decision a preliminary investigation was launched by an independent French financial magistrate to look into the corruption allegations but French state prosecutors, overseen by the government of Nicolas Sarkozy quickly launched an appeal to prevent the case from being opened arguing that Transparency International has no right to lodge a complaint because it is not a direct victim of any wrongdoing.

The public prosecutor has twice previously ruled that the complaint by the anti-corruption activists was inadmissible. The fact is that France has important economic and strategic interests in the three oil and gas-producing countries and fears the case may harm relations with her former colonies hence the appeal. In the last five decades France has supported corrupt regimes and dictators to embezzle billions of dollars belonging to most of her poor former colonies.

For example a French police report has revealed that Omar Bongo and his close relatives own 33 luxury properties in France but newspapers put the figure at 59. Bongo and his family also have 70 French bank accounts and at least nine luxury cars, including Ferraris and Mercedes worth a total of €1.5m (£1.3m).

Denis Sassou Nguesso and his family have 112 French bank accounts, 13 luxury cars in France and 24 properties. Sassou-Nguesso's daughter Edith – who was Bongo's late wife, bought a mansion in the rich eighth arrondissement of Paris for 18.9-million euros. Only God knows how much money has been stolen and placed in these bank accounts.

Teodoro Obiang Nguema of Equatorial Guinea, along with family members, he has eight luxury cars, worth a total of €4.2m, in France. His son, a government minister, owns an apartment in an exclusive area of the capital. Source:

In a separate French investigation into corruption at the former oil giant
Elf Aquitaine, an executive testified that it paid £40m a year to Bongo via
Swiss bank accounts in exchange for permission to exploit his country’s
oil reserves. In February of 2009 a court in France had nine of Bongo’s bank accounts containing several millions of Euros frozen. 
Can  French economy be described as clean or dirt-driven?

 A damning report by Global Witness accuses Western banks of facilitating corruption and denying some of the world’s poorest people the chance to escape poverty. The banks included HSBC, Citigroup, Banco Santanderand Barclays.
Among its allegations are claims that Barclays kept open an account for the son of the dictator of oil-rich Equatorial Guinea, despite evidence that his family had looted the country's oil revenues. Global Witness also accused HSBC and Santander, Abbey's Spanish owner, of frustrating US efforts to investigate the looting and laundering of Equatorial Guinea's oil revenues by hiding behind bank secrecy laws in Luxembourg and Spain. 

Global Witness also accused Citi Bank for helping 
Charles Taylor, to loot timber revenues in Sierra Leone and Liberia. Gavin Hayman, Campaign Director for Global Witness, says: "The same lax regulation that created the credit crunch has let some of the world's biggest banks to facilitate the looting of natural resource wealth from poor countries and concludes that
"If resources like oil and timber are to truly help lift Africa and other poor regions out of poverty, then banks must be made to stop doing business with corrupt dictators and their families."

The world seven most industrialised nations (G7) have been making a lot noise about the poverty situation in the third world especially in Africa. They have spearheaded the UN Millennium Development Goals that has set targets to reduce poverty by 2015 but it is clear these same G7 nations are the very countries causing the poverty. They enact secrecy laws that establish corrupt financial infrastructures; their multinational corporations bribe third world leaders, assist them to hide their loots in Western Banks; politicians intervene when cases are filed against corrupt leaders in Africa and who suffers in all these?

US Senator Richard Lugar says: "Corruption thwarts development efforts in many ways. Bribes can influence important bank decisions on projects and on contractors. Misuse of funds can inflate project costs, deny needed assistance to the poor, and cause projects to fail. Stolen money may prop up dictatorships and finance human rights abuses. Moreover, when developing countries lose development bank funds through corruption, the taxpayers in those poor countries are still obligated to repay the development banks. So, not only are the impoverished cheated out of development benefits, they are left to repay the resulting debts to the banks.

And Dr. Susan Hawley agrees with him and says: “Multinational corporations’ corrupt practices affect the South (i.e. Africa, Asia and Latin America) in many ways. They undermine development and exacerbate inequality and poverty. They disadvantage smaller domestic firms and transfer money that could be put towards poverty eradication into the hands of the rich. They distort decision-making in favour of projects that benefit the few rather than the many. They also increase debt that benefit the company, not the country; bypass local democratic processes; damage the environment; circumvent legislation; and promote weapons sales. Bribes put up the prices of projects. When these projects are paid for with money borrowed internationally, bribery adds to a country's external debt. Ordinary people end up paying this back through cuts in spending on health, education and public services. Often they also have to pay by shouldering the long-term burdens of projects that do not benefit them and which they never requested”. Source: The Corner House, June 2000.

A UN report of October 2002 accused 85 European and U.S. multinational corporations – including Anglo American, Barclays Bank, Bayer, De Beers and Cabot Corporation of violating the Organization for Economic Cooperation and Development's ethical guidelines on conflict zones. The guidelines they were accused of violating relate to arming Rwanda, Uganda and Congolese rebels and profiting from their illegal looting of Congo's minerals.

British Aerospace was accused of paying bribes to Tanzania officials to look the other way while a device with ageing technology was sold to the country. Former Prime Minister Tony Blair was accused of helping BAE to seal the deal. “The UK sold a useless air traffic control system to Tanzania in 2001 in a scandalous and squalid deal, the House of Commons was told.” Clare Short an MP said, “The deal was useless and hostile to the interests of Tanzania”. She said, “Barclays Bank had colluded with the government by loaning Tanzania the money, but lying to the World Bank about the type and size of the loan.”  Shadow international development secretary Andrew Mitchell said “BAE had used ageing technology and said the system was not adequate and too expensive.” Source: BBCNEWS, Wednesday, 31 January 2007. Corruption investigation concerning arms sales to Saudi Arabia by this same BAE was stopped by the same Tony Blair in December 2006.

It is on record that multinational corporations declare about 40% of their profits in African countries where they operate and siphon the rest into their save haven accounts in Europe, the Pacific and Caribbean with the full knowledge of their governments.

Elf for instance operated as an arm of the French state supporting dictators, looting third world resources and establishing flush fund which was used to bribe African leaders so they will look the other way while Elf loots Africa's oil and gas. Andre Tarallo the real boss of Elf-Afrique “told the court in June 2003 that annual cash transfers totalling about £10m were made to Omar Bongo, Gabon's president, while other huge sums were paid to leaders in Angola, Cameroon and Congo-Brazzaville”. Source: Guardian, Nov. 2003.

The real deal is that Elf, Shell, BP and their counterparts in Europe and America pay bribes to African leaders to induce them to look the other way why they plunder the resources. 

Nicholas Shaxson, author of Poisoned Wells, wrote of the subject: “Magistrates discovered the money from Elf's African operations supplied bribes to support French commercial, military and diplomatic goals around the world. In exchange, French troops protected compliant African dictators.”
 This is how African politicians and civil servants have been corrupted by multinational corporations assisted by the big banks in Europe and America but we often do not hear much about them.

Switzerland, Britain, United States, Luxembourg, Liechtenstein and France are the most culprits of all and can be said to be the most corrupt countries in the world because they have created the international financial infrastructures that allow corrupt politicians, business elite and criminals to hide their ill-gotten wealth and to escape prosecution. Switzerland in particular has come under heavy criticism because of her relationship with dictators and criminals around the world. There has not been a single corrupt dictator or criminal who has not had links with British, Swiss or French governments or their institutions. From Saddam Hussein all down to Mobutu, Abacha, Lansana Conte, Ferdinand Marcos, Baby Doc Duvalier, Omar Bongo, Nguema, Sassou Nguesso, Campore, Dos Santos all have connections with one or more of these countries yet their economies are always given a clean sheet by anti corruption watchdogs.

Dr. Susan Hawley, author of “Exporting Corruption” says: Private banking services and offshore financial centres are the major conduits and repositories for bribes and corrupt gains. An estimated US$40 billion from poor and former communist economies finds its way into US or European banks every year, much of it illegitimately gained. Some $30 billion of Western aid "used as part of the Cold War game of winning friends" has ended up in Swiss bank accounts alone. Leaders from some African countries have collectively had up to $20 billion on deposit in Switzerland's banks. Haiti's "Baby Doc" Duvalier is known to have kept $300-900 million in offshore banks, while Philippine President Marcos salted away well over $2 billion in Western banks.

How could corrupt dictators and their associates succeed in looting and hiding their ill-gotten wealth without the collusion, connivance and support of western political and business establishments and its corrupt financial infrastructures? How was Abacha able to hide over five billion dollars in Switzerland and Britain? How was Mobutu able to hide about $10-billion in Europe?

A US Senate inquiry in 1999 revealed that the giant Citibank held private accounts for many corrupt Third World leaders. These included Gabonese president Omar Bongo (who transferred US$100 million, allegedly including bribes from French firm Elf-Aquitaine, through his three accounts), Benazir Bhutto's husband Asif Ali Zardari ($40 million, including $10 million allegedly from kickbacks on a gold importing contract), the three sons of Sani Abacha ($110 million in accounts, plus $39 million lent to them to deposit in Swiss accounts after the new Nigerian government began investigations) and Raul Salinas, brother of one-time Mexican President Carlos Salinas ($80-$100 million in alleged drug money).

This day light robbery by third world leaders and the protection offered them by countries like France, Switzerland, Britain, United States and Spain are the result of the chronic poverty seen everywhere in Africa, Haiti, Philippines, Bangladesh, Pakistan, Kazakhstan and most of the developing world. While criminal international financial institutions aid and abet these dictators to plunder the treasuries of their countries, millions of Africans who live in abject poverty continue to cry for basic necessities of life such as water and food. In the name of economic interest, European and North American countries are causing millions to die by protecting these corrupt politicians and their associates.

The fact is that Europe, North America, their financial colonies in the Pacific and the Caribbean Islands and their multinational institutions are so attractive to corrupt politicians and criminals of all sorts due to the existence of corrupt banking and real estate infrastructures; the secrecy laws (omerta) that protect these corrupt financial entities; a weak justice system that make mockery of the law to fight financial crimes, international fraud and tax havens; and a complete absence of due diligence checks which allow anyone including the multinational corporations to do anything for money be it legal or illegal. The current global crisis caused by these greedy criminals attest to this fact. The crisis negative effect worldwide is a strong message to the governments in Europe and America that no one is safe, not even their political career.

 It is time to abolish all the banking secrecy laws; close down all the save haven centres; eliminate all the infrastructures that promote fraud, tax evasion, corruption, embezzlement and dictatorships; and rein in on the corrupt banking and real estate industries and those who illegally patronise their services.   Unless the system and its supporting infrastructures are destroyed, there will be no immediate end to poverty and the attainment of the millennium development goals set by the United Nations will be a mirage. Poverty, malnutrition, hunger, starvation, diseases, and political instabilities will continue to dominate the regions where these assets are stolen from and the spill over effect will be the increased influx of illegal immigrants that Europeans are at the moment struggling to cope with.

By Lord Aikins Adusei

Political Activist and Anti-Corruption Campaigner

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