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Sunday, 3 April 2011

Sustainable energy access for Africa: a win-win solution for climate and development

*By Fiona Lambe and Patricia Tella


A woman cooks using firewood Photo courtesy
Supporting developing countries to scale-up access to sustainable energy for cooking will not only bring positive effects for climate change; it will improve the health and economy of the world’s most vulnerable households. What’s more, the cost of achieving universal energy access in the coming decades is surprisingly low.

It is difficult to imagine, but right now approximately two billion people, one third of humanity, do not have access to energy for their most basic needs such as cooking, lighting and heating. Not coincidently, this is the same one third that is currently living in extreme poverty. Access to clean and safe energy for cooking is essential for human development. No country in modern times has managed to reduce poverty and achieve economic development without increasing access to modern forms of energy. Without a massive scale up in access to clean and safe energy, the world’s poorest regions will remain trapped in poverty.

For most Swedes, cooking is an enjoyable pastime and something that is normally taken for granted. We just flip a switch; turn a knob, and the stove turns own. However, for two thirds of the worlds’ population, this fundamental task is both a tiresome burden and a major health risk.

In Sub Saharan Africa, four out of five households do all their cooking over an open fire or using an inefficient wood or charcoal burning stove which exposes them to high levels of smoke and health damaging chemicals. They cook this way because they have very limited choice. Electricity is either unavailable - only 28% of SSA (excluding South Africa) is electrified - or unaffordable. Since the task of cooking usually falls to women and girls, it is they who face daily exposure to levels of pollution which are estimated to be the equivalent of consuming two packets of cigarettes a day (WHO, 2006).

The health impact of this exposure is devastating. According to the World Health Organisation (WHO) smoke from domestic fires kills nearly two million people each year and sickens millions more. This is more than three people per minute. It is a death toll almost as great as that caused by dirty water and poor sanitation and AIDS, and greater than malaria. Without systematic changes, household biomass use will result in an estimated 8.1 million Lower Respiratory Infection (LRI) deaths among young children in sub-Saharan Africa alone between 2000 and 2030 (Bailis, Ezzati, Kammen, 2007, p 6).

These are indeed startling figures. So why isn’t more being done to tackle this problem? If indoor air pollution is responsible for more deaths globally than malaria each year, why don’t we see a global push for energy access similar in profile and funding to the global anti-malaria campaigns?
One answer is that until recently, there has been a marked lack of political will to acknowledge and tackle this glaring problem. This was made blatantly clear in September 2000 when heads of state from all over the world met to agree on eight specific targets for combating poverty, disease, illiteracy, hunger and environmental degradation. The deadline for achieving these eight ambitious Millennium Development Goals (MDGs) is 2015 - just five years from now, but we are far from on track to meeting these targets. A major reason for this is that Energy Access was completely left out of the picture. Amazingly, there is no Millennium Development Goal on Energy, despite the fact that lack of access to clean and safe energy, especially for cooking, is a major impediment to meeting every one of the MDGs.

Now, with just over five years to go, we are beginning to see some momentum and a new global push to get energy access firmly on the development agenda. One major reason for this about turn is recognition of the enormous potential for so called “co-benefits”– additional or “bonus” opportunities for tackling climate change through projects designed to address the household energy problem in developing countries.

Cooking stoves and climate change
The same tiny particles from cooking fires that are linked to more than two million deaths annually are also contributing to climate change. Black carbon or soot is thought to be the second biggest contributor to global warming after CO2, and although dirty diesel engines, power plants and other more advanced technologies also produce black carbon, cooking fires appear to be the largest source of soot in developing nations. Several studies have indicated that reducing black carbon emissions may be among the most accessible, quick and cost effective actions to mitigate climate warming over the coming decades (e.g. Hansen et al.; Jacobson, 2002; Bond and Sun, 2005).
CleanCook photo showing an Addis Ababa woman
cooking on her two-burner CleanCook. On the
right,she is using a traditionally rounded pot which is now held sturdily by the pot support.
Replacing inefficient cooking devices with cleaner stoves and fuels, while immediately improving the health and well being of the users, could also have a significant positive impact on global warming in a relatively short time frame. This is because, unlike carbon dioxide which can remain in the atmosphere for many decades, black carbon particles generally fall from the sky in days or weeks.

A wide range of new and improved cooking stoves, as well as cleaner fuels are currently being field tested – many of these show great potential for addressing the climate and health problems. One success story is that of the ethanol fuelled “CleanCook” stove, originally Swedish technology, in Ethiopia. Ethiopian NGO, Gaia Association has pilot tested these stoves in households in Addis Ababa and in a number of refugee camps with very positive results. Households are ready to switch completely to ethanol (which is locally produced from sugar cane residues) and the project will soon enter a commercial phase where the Swedish stoves will be produced and sold locally.

Although a global effort to roll out improved household energy programmes poses a number of challenges, relatively speaking, it is not an expensive project. The IEA, in its recently published World Energy Outlook estimated that universal access to clean cooking facilities could be achieved through additional cumulative investment on $56 million in 210-2030 (IEA, 2010). This investment is equivalent to 0.2% of the total projected global energy investment to 2030.

There is now widespread consensus among policy makers and the development community that addressing the energy access problem is a matter of urgency. In September 2010, the Global Alliance for Clean Cookstoves was officially launched by U.S. Secretary of State Hillary Rodham Clinton. This is a $60 million dollar public-private partnership to save lives, improve livelihoods, empower women and combat climate change by creating a thriving global market for clean and efficient household cooking solutions. The Alliance’s goal is for 100 million homes to adopt clean and efficient stoves and fuels by 2020.

2010 also saw the launch of the Energy for All 2030 Project, an EU-wide initiative aimed at raising policy and public awareness about the issue of energy access for meeting the MDGs in SSA. In Sweden, Energy for All 2030 is being led by the Stockholm Environment Institute which is playing a leading role in highlighting these issues for Swedish and European Policy makers and supporting a platform for dialogue between African and European civil society. The SEI, together with UK partner, Practical Action recently met with the EU Development Commissioner Andris Piebalgs to push for more policy focus and financing at the EU level for the goal of universal energy access. This political momentum is set to continue over the coming years and particularly in the run up to 2015 and the deadline for meeting the MDGs.

It remains to be seen if the energy access targets can be met within the given timeframes. But there is hope. Prioritizing energy access as a key driver of social and economic development is undoubtedly the first step towards achieving universal energy access and there, at least, we have agreement. Now we need to see this consensus and support translate into action for the worlds’ poorest.

Energy for all 2030 is a Europe-wide project calling for more and better funding from the European Commission for energy access projects in Sub Saharan Africa. Support the Energy for All 2030 Project. Go to http://practicalaction.org/energy-advocacy/makethecall and pledge your support to make universal energy access a reality by 2030.

*The authors are Associate Researchers at Stockholm Environment Institute (SEI) in Stockholm-Sweden. They can be contacted through their e-mails: Fiona Lambe (Fiona.lambe@sei.se) and Patricia Tella (patricia.tella@sei.se)
Posted by Africa Image at 07:24

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STOP CORRUPTION

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Africa is not poor except that it has been poorly managed by those entrusted with its development and safety. The image of the world's most resource rich continent has been damaged by corruption, poverty,leadership failures, political instabilities, election violence, dictatorships,cronyism, and nepotism. How did it all happen and what can be done to salvage the battered image of continent is the subject matter of this blog - Africa Image.Here at Africa Image we do our best to identify the problems and suggest possible solutions to them.We believe that the problems facing the continent is inherent in the Culture of Politics and Economics as practiced today and therefore for the continent to come out of its current predicament something needs to be done to these two cultures.

Exporting Corruption to the South

Multinational corporations' corrupt practices affect the South in many ways. They undermine development and exacerbate inequality and poverty. They disadvantage smaller domestic firms. They 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; benefit the company, not the country; bypass local democratic processes; damage the environment; circumvent legislation; and promote weapons sales.

Increasing Debt

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.

The US company, Westinghouse Electric Corp, provides an infamous example. Westinghouse won a contract in the early 1970s to build the Bataan nuclear plant in the Philippines. It was alleged that it 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. Commented Philippines Treasurer Leonor Briones recently:

"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

Africa Stolen Assets in Western Banks

For example, in 1997, the French Weekly Newspaper published these stolen assets of African rulers: General Sani Abaca of Nigeria, 120 billion FF (or $20 billion); former Ivorian President H. Boigny, 35 billion FF (or $ 6 billion); General Ibrahim Babangida of Nigeria, 30 billion FF (or $ 5 billion); the late President Mobutu of Zaire, 22 billion FF (or $ 4 billion); President Mousa Traore of Mali, 10.8 billion FF (or $ 2 billion).

Other names mentioned by the French Weekly were President Henri Bedie of Ivory Coast, 2 billion FF (or 300 million); President Denis N'guesso of Congo, 1.2 billion FF (or 200 million); President Omar Bongo of Gabon, 0.5 billion FF (or $ $80 million); President Paul Biya of Cameroon, 450 million FF (or $70 million); President Haile Mariam of Ethiopia, 200 million FF (or $30 million); and President Hissene Habre of Chad, 20 million FF (or $3 million). Bear in mind that this list does not reflect the actual amount of money stolen out of Africa by these dictators. Factually, the mentioned figures had changed significantly since the French Weekly article was published in 1997.

There are now new African billionaires and millionaires, including indicted former Liberian President Charles Taylor, President Gabassinga Eyadema of Togo, former Liberian Warlord Alhaji Kromah, former Ghanaian dictator Jerry J. Rawlings, and the late President Samuel Doe of Liberia; a host of African government ministers would make an updated list. While returning funds stolen out of Africa is the right thing to do, efforts must be made by the West and responsible African governments {i.e. the government of Botswana, etc.} to alter international banking laws that will make it difficult for Africa's government officials and corrupt business personalities to transfer huge funds into western banks. The measure was first proposed following the September 11, 2001 attacks but was rebuffed by western financial institutions. Again, we need to revisit this issue: the terrorists could use the thieves in Africa's government Ministries to transfer money into western bank accounts—the money could be used at a later time for terrorists' activities

Did you know?

Did You Know?

Sub-Saharan Africa receives $10 billion in aid but loses $14 billion in debt payments per year.
In Burundi, elimination of education fees in 2005 allowed an additional 300,000 children to attend school.
While more than 80 million Nigerians live on less than $1 per day, in 2005 Nigeria agreed to pay over $12 billion to the Paris Club of creditors in exchange for partial debt cancellation.
In 2003, Zambia spent twice as much on debt repayments as on health care. But partial debt cancellation allowed the government to grant free basic healthcare to its population in 2006.
 

African Voices on Debt

“Must we starve our children to pay our debts?”Julius Nyerere, former president of Tanzania
“The debt is a new form of slavery, as vicious as the slave trade.” All Africa Conference of Churches
“Debt is tearing down schools, clinics and hospitals. The effects are no less devastating than war.” Adebayo Adedeji, African Center for Development Strategy, Nigeria

Source: Africa Action

African money stolen so far

Africa has lost $140 billion through corruption in the decades since independence, says Nigeria’s president, Olusegun Obasanjo. The huge sum, largely spirited away by leaders and their associates, was one of the main reasons why Africa’s poverty was so severe.

(BBC News, June 13, 2002)

In May 1997, the French Weekly Newspaper published these stolen assets of African rulers: General Sani Abaca of Nigeria, 120 billion FF (or $20 billion); former Ivorian President H. Boigny, 35 billion FF (or $ 6 billion); General Ibrahim Babangida of Nigeria, 30 billion FF (or $ 5 billion); the late President Mobutu of Zaire, 22 billion FF (or $ 4 billion); President Mousa Traore of Mali, 10.8 billion FF (or $ 2 billion).


Other names mentioned by the French Weekly were President Henri Bedie of Ivory Coast, 2 billion FF (or $300 million); President Denis N'guesso of Congo, 1.2 billion FF (or $200 million); President Omar Bongo of Gabon, 0.5 billion FF (or $ $80 million); President Paul Biya of Cameroon, 450 million FF (or $70 million); President Haile Mariam of Ethiopia, 200 million FF (or $30 million); and President Hissene Habre of Chad,20 million FF (or $3 million). Bear in mind that this list does not reflect the actual amount of money stolen out of Africa by these dictators. Factually, the mentioned figures had changed significantly since the French Weekly article was published in 1997. There are now new African billionaires and millionaires, including indicted former Liberian President Charles Taylor, President Gabassinga Eyadema of Togo, former Liberian Warlord Alhaji Kromah, former Ghanaian dictator Jerry J. Rawlings, and the late President Samuel Doe of Liberia; a host of African government ministers would make an updated list. While returning funds stolen out of Africa is the right thing to do, efforts must be made by the West and responsible African governments {i.e. the government of Botswana, etc.} to alter international banking laws that will make it difficult for Africa's government officials and corrupt business personalities to transfer huge funds into western banks. The measure was first proposed following the September 11, 2001 attacks but was rebuffed
by western financial institutions. Again, we need to revisit this issue: the terrorists could use the thieves in Africa's government Ministries to transfer money into western bank accounts—the money could be used at a later time for terrorists' activities.

(Paul Japheth Sunwabe) Paul Japheth Sunwabe (a native of Liberia) is a graduate student of World Politics at The Catholic University of America. He is also the co-founder and President of Freedom and International Justice, a Washington DC based inclusive political organization seeking democracy, social justice and economic reforms in Africa. For this and subsequent articles, please visit www.freedomjusticef54.org/articles/

A major shift in funding development in Africa is accelerating. Major donors have been urging African governments to eradicate corruption or face cuts in aid. (African Recovery, by Sam Chege)

Despite the country’s abundant natural resources, including copper, gold and diamonds, the people of the Democratic Republic of Congo continue to sink further into poverty. Meanwhile, Mobutu, the late president who died in 1997, amassed a personal fortune of $5 billion, which was deposited in Swiss banks. (CNN world news, September 7, 1997). After more than three years of legal wrangling, the Nigerian government has finally achieved a major breakthrough in it’s efforts to recoup a substantial amount of money looted by the former president, General Sani Abacha. The money was stored in Swiss bank accounts. Abacha, who died of an apparent heart attack in 1998, had been accused of stealing nearly $3 billion from state funds in a series of staggering revelations of how he and his immediate family personalized Nigeria’s treasury. (This DAY, May 30, 2002)

An excellent way to get rich quick is to be the ex-wife of an ex-president. This is what Mrs. Vera Chiluba is claiming from ex president Chiluba in her application to Ndola High Court: She wants US$2.5 billion in a lump sum, and claims she can prove he has the funds available. She also requires maintenance for their nine children, none of whom are in gainful employment. She also needs a share in 6 properties in Ndola and a commercial farm in Chi samba. Also she needs a new executive Mercedes Benz 500 (or 600), a new Land Cruiser, a new Nissan Patrol, drivers as well and a court order for the return of 400 cattle, sheep and goats which are still at State Lodge.This was taken from the Zambia Post and was also reported in The Zambia Society Newsletter compiled by the glamorous Maggie Currie. Are African presidents the only ones so clever in accumulating wealth so quickly? Even ex president Marcos of the Philippines didn’t get hold of such huge amounts in such a short time. (Elias Georgopoullos, Saturday, April 27, 2002 at 12:52:22 PDT)

The French journal, ‘L’Evenement du jeudi published an article stating that the president of Cameroon, Paul Biya, is worth more than $45 billion FCA, money gleaned from the sales of petroleum. Mr. Biya has not refuted these claims.(Post watch Fact File report by Ntemfac Ofeae, undated).

The late president Mobutu of the Democratic Republic of Congo holds the record for financial plunder and national ruin. It is estimated that he stole $4 billion, leaving the country poorer than he found it, with ruined infrastructure and no formal economy to speak of. A close second to Mobutu is the late dictator of Nigeria, Sani Abacha, whose rule left 70 percent of Nigeria’s 120 million people living on less than one dollar per day. In Kenya, the Daniel Arap Moi dictatorship must be given credit for the systematic destruction of what used to be Africa’s economic showcase from the 1960s through the 70s. The authoritative Africa Confidential put Moi’s external bank holdings at $3 billion. In the so-called Goldenberg scandal, the Moi regime bolted with an estimated $1 biliion from its own central bank (12 percent of the national’s GDP), setting off a spiral of inflation, economic stagnation, unemployment, crime, ruined agricultural sector and decaying public services. (Testimony on the social and political costs of the theft of public funds by African Dictators: US House of Representatives Committee on Financial Services by Michael Chege, University of Florida, May 9, 2002)

Recent surveys carried out by the World Bank in a series of developing countries to compare budget allocations to actual spending at the facility level have confirmed that resources are not allocated according to underlying budget decision. In Uganda and Tanzania, large parts of funds were diverted elsewhere or for private gain. (U4 Utstein Anti corruption resource website) Peter Machungwa, Home Affairs Minister, Godden Mandandi, Works and supply Minister were arrested on Tuesday night in connection with the disappearance of $2 billion in government funds.(Business Day, October 24, 2002) Paul Tembo, former deputy minister of Finance, was shot dead in his home hours before testifying in corruption trial of three cabinet ministers. (BBC News, July 9, 2001). Zambian police and politicians have been identified to be the worst corrupt elements in the country. (AllAfrica.com, March 1, 2001)

SOURC :TRACEAID

Hiding The Loot: Western Banks and Third World Assets


"Money laundering is the handmaiden of international corruption ... Those who take bribes must find safe international financial channels through which they can bank their ill-gotten gains. Those who provide the bribes may well assist the bribe takers to establish safe financial channels and launder the cash."

Frank Vogl, Transparency International

"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."

US Senator Carl Levin

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 the IMF/WB Helped Africa to become poor

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 and 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 the 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.”

Shortly after Blumenthal's report to the IMF, it gave Zaire the largest ever loan given to an African country. [1] 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. Commercial banks refused to lend more to Mobutu during that period.

Patricia Adams in her book Odious Debts [2] estimates the Philippines 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: Jubileeresearch.org

“The private banking boom has its origins in the debt crisis and is a major reason for the continued indebtedness of many poor countries”, it notes. “Because of the debt crisis in the late 1980s onwards, Western banks had fewer opportunities to lend to Third World countries and thus started to pursue wealthy individuals in the Third World to encourage them to place their wealth in private bank accounts.

“The result was a revolving door. International loans to developing countries were creamed off by those in power and transferred into banks, ironically often to `private banking' branches of the very same international banks that had issued the international loan in the first place.”SOURCE:WWW.GREENLEFT.AU

CIA, AFRICA CONFLICTS AND POVERTY

In one of the classic, ironic follies of intelligence charades, Gulf Oil Company employees returned immediately to resume pumping the Angolan oil-protected militarily by Cuban soldiers from CIA mercenaries who were still marauding and destabilizing the countryside. Nor did the Angola tragedy end with the CIA's defeat in the winter of 1976. Under President Reagan, congressional restraints were lifted and the CLA resumed its support of Jonas Savimbi and his UNITA forces. Over the years the continued destabilization has taken a horrendous toll: the Red Cross counts over 20,000 walking-maimed in Angola today and the central part of the country, which used to be its bread basket, is now a recognized zone of famine.


Aid to Third World won't be necessary If the West cracks down on crooked banks

The World Bank’s Stolen Asset Recovery initiative estimates the cross-border flow of proceeds from criminal activities, corruption and tax evasion at between $1 trillion and $1.6 trillion per year, about half of which comes from developing and transitional economies. This dwarfs foreign aid, which totaled about $50 billion a year through the 1990s and is about $100 billion today. So we have $50–100 billion of aid flowing into poor countries, and $500–800 billion of dirty money flowing out. In other words, for every dollar Western governments have been handing out across the top of the table, crooked Western banks, businesses and middlemen of various descriptions have been taking back up to ten dollars of illicit proceeds under the table.
Aid to the Third World will not be necessary If Western  countries crack 
down on crooked banks,businesses and middlemen.

Dirty money in many forms welcomed by the United States and Europe allows the proceeds of drug trafficking, racketeering, corruption and terrorism to tag alongside. These are parallel rails on the same tracks coursing through the global financial system. In 2006, developing regions 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”.

Africa's Corrupt Leaders :Who is Who

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), Bhutto's husband Asif Ali Zardari ($40 million, including $10 million allegedly from kickbacks on a gold importing contract), the three sons of former Nigerian strongman 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).

Africans do not Need Transparency International Index, They Want to Know where Their Money has Gone

While the Corruption Perception Index does provide an invaluable ranking for investors trying to assess country risk, it is of little use to the citizens of oil-rich Nigeria, for example, to be informed by the CPI that their country is among the world’s most corrupt. Nigerians and others like them want to know where their money has gone.Consider the brutal Nigerian president Sani Abacha, who died in 1998, allegedly in the company of Indian prostitutes, but not before he had raked off billions of dollars of oil money from state coffers. Or to take a more recent example, we now know more or less how relatives and associates of the former Kenyan President Daniel arap Moi diverted hundreds of millions of dollars into their pockets through a web of shell companies, secret trusts and other evasive structures. Two jurisdictions that happily soaked up the embezzled wealth of both regimes are worth highlighting: Switzerland and the United Kingdom. “The UK authorities and banks”, the BBC reported after a bit of the money was eventually returned, “were found to have been even less cooperative than the Swiss, despite the latter’s long and sullied reputation for protecting allegedly stolen assets.”The Corruption Perception Index (CPI) ranks the countries of Africa as the primary locus of corruption, but it ignores the global infrastructure of international financial secrecy that has helped bleed trillions of dollars in illicitly generated money not only out of Africa but also out of the Middle East, Latin America and Russia into the financial centers of the richest countries in the world especially Britain, Switzerland, Lexumbourg, Austria, Liechstentein and in France where Omar Bongo, Obiang Nguema, Denis Sassou Ngeusso and a host of African leaders have bought several properties using funds stolen from their countries. For example, the CPI ranks the countries of Africa as the primary locus of corruption, but it ignores the global infrastructure of international financial secrecy that has helped bleed trillions of dollars in illicitly generated money not only out of Africa but also out of the Middle East, Latin America and Russia into the financial centers of the richest countries in the world.

Corruption, tax evasion, and criminal activitivities causing poverty in the Third World

Global Financial Intergrrity says:Every year developing countries lose as much as $1 trillion due to illicit financial practices such as government corruption, tax evasion, and criminal activity. Today’s pledge from the G-20 to increase funding for the IMF and for the developing world are laudable, but these efforts must also address illicit capital flight which remains the greatest impediment to economic development and poverty alleviation.

GFI Director Raymond Baker said today “increasing aid will be marginally effective as long as the so-called shadow financial system remains intact. Comprised of tax havens, secrecy jurisdictions, and a host of other entities and techniques designed to shift assets across borders illicitly, this global network is facilitating a draining of assets which outpace official development aid at a rate of 10 to one. This means that for every $1 dollar that goes into developing countries as aid, $10 goes right back out via courtesy of this shadow financial system.”

France:Protector of Corrupt African Despots.

Nicholas Shaxson, author of Poisoned Wells, wrote of the subject: “Magistrates discovered the money from Elf’s African operations financed French political parties and officials, and supplied bribes to support French commercial, military and diplomatic goals around the world. In exchange, French troops protected compliant African dictators.”

France has been the protector of corrupt African dictators who amass wealth at the expense of their poor countries. Most of the monies stolen by the leaders of French speaking African countries end up in France. French Police investigation recently revealed that Omar Bongo of Gabon has 33 luxury properties in France and so are Denis Sassou Nguesso, Eduardo dos Santos, Blaise Campore, and a host of others.

SHELL OIL CO. & CITIBANK USA ARE PARTNER IN CORRUPTION

How deep is corruption in Africa?
Anti-graft posters
In Kenya, posters are being used to fight graft

In Nigeria, the international oil giant Shell admitted that it inadvertently fed conflict, poverty and corruption through its oil activities in the country.

Nigeria contributes to about 10% of Shell's global 

production and is home to some of its most promising reserves, yet the country is steeped in poverty and

conflict.

According to Shell, it has been difficult to operate with integrity in areas of conflict like Nigeria.

In some Cameroonian public hospitals, patients say 

they have to put some money in the doctor's 

consultation book before they are attended to.

And in some schools, a student cannot pass 

examinations without bribing the teachers.

In Zambia, former President Fredrick Chiluba is

 facing corruption charges for offences he allegedly 

committed during his term in office.

SOURCE:BBC

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), Bhutto's husband Asif Ali Zardari ($40 million, including $10 million allegedly from kickbacks on a gold importing contract), the three sons of former Nigerian strongman 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).

Supporting Corporations to keep Africans Poor:The Role of IMF and the World Bank

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. SAPs were justified on the basis of outstanding debt, unilaterally contracted by corrupt and despotic regimes; a considerable portion siphoned in virtual suitcases almost on arrival. Africa has collectively lost more than $600-billion in capital flight, excluding other mechanisms of flight including ecological debt (globally estimated at a potential $1,8-trillion per annum), the cost of liberalised trade (just under $300-billion) … and the list goes on …

Yet it is impossible to ascertain the origin and destination of capital flight as the international financial community successfully lobbied to have automatic exchange of tax information scrapped from the IMF’s Article of Agreements, immunizing corporate and Third World corruption. Though Africa has been labelled as the world’s most corrupt region, generally 3% to 5% of total outflow emanates from the political elite, with 30% composed of criminal flight. Multinational internal mispricing makes up 60% of capital outflow, with corporations declaring profits in tax havens, as opposed to the country of performance.

For example, in 1998 the Pakistani anti-corruption agency investigated 21 Western companies for paying kickbacks to Benazir Bhutto's government for public contracts to provide electricity. That government had signed so many contracts with power companies that Pakistan was contractually bound until 2010 to produce more energy than it could possibly consume.

Six of the companies later confessed to offering bribes. Yet, far from receiving support for its stand from Western governments, Pakistan's anti-corruption agency was warned by the British, US, Japanese and Canadian governments that its investigations would put off other investors. The IMF, meanwhile, made a package of loans conditional on the government dropping the charges against the companies involved.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:

greenleft.org.au

How Corporations Cheat poor countries

According to Global Financial Integrity, $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. “The idea that Switzerland has a clean economy is a joke; it is a dirt-driven economy,” stated Richard Murphy, director of Tax Research LLP. The Swiss Bankers Association claims that four-fifths of the nation supports banking secrecy, revealing a society deeply embedded in a culture of impunity and exploitation, where the licit acts as a shield protecting the illicit in a terribly respectable manner. Companies doing business in the third world declare about 50% of their profits and then stash the rest in havens.

Anti-Corruption Campaigners

Fighting corruption has become a daily battle for anti corruption campaigners,civil society organisations, NGOs and governments around the world. But corruption will not go away so far as there are banking secrecy laws in Switzerland, Austria, Luxembourg and Liechtenstein that allow banks to accept money without questioning its source or releasing the names of their clients.It will not go away so far as France, Britain and the US allow property dealers to sell to corrupt African leaders without questioning where they got the money. The offshore banks in Jersey Island and the Islands in the Caribbean and the Pacific are a key part in promoting corruption and poverty around the world as the safe havens they provide makes it ideal for corrupt officials to steal and hide their loots.Corruption exists because those who steal do not lack a place to hide them. Any time money is stolen from Africa you do not have to look far, just ask the Swiss Banks they always have a clue. Of course, it won’t be easy. Powerful vested interests have a lot to lose from cleaning up the current state of global capitalism. But the rest of us have even more to lose if we don’t. If global capitalism cannot be rendered essentially fair, then it is unlikely to be sustainable in a world where formerly marginalized people are rapidly emerging from eons of political ignorance and passivity. We either join together to fix this problem, or it will surely “fix” us. Citizen Action Against Poverty and Corruption in Nicaragua, which is demanding that the president and other officials declare the sources of their incomes; the Uganda Debt Network and the International Anti-Corruption Theatre Movement are increasing their voice

The Cost of Corruption

Corruption in Africa is costing the continent nearly $150bn a year, according to a new report.

The African regional body, the African Union (AU) has drawn up a convention to stamp out malpractices which the study says are hitting the poorest the hardest.

The report says corruption hits the poorest hardest
Corruption is illegal everywhere in Africa, but everywhere it is woven deep into the fabric of every day life.

From the bottle of whisky slipped under the counter to speed a traveller's way through customs, to the presidents and ex-presidents living way beyond their declared means, it results in an assumption that no business will ever get done without a present changing hands.

The report before this week's meeting of the African Union in the Ethiopian capital, Addis Ababa, makes no attempt to excuse these "gratifications" as part of the culture.

It says that corruption is costing Africa more than $148bn dollars a year, increasing the cost of goods by as much as 20%, deterring investment and holding back development.In Uganda, often held up by the IMF and World Bank as a model of the success of their policies, the government has set about privatising 142 state-owned enterprises since 1992, the sales of which was expected to net US$500 million. However, by 1998 the process had been halted twice by parliament because of corruption: at the end of that year, the government account set up to hold the proceeds of privatisation was empty.The cross-border flow of the global proceeds from criminal activities, corruption, and tax evasion is estimated at between $1 trillion and $1.6 trillion per year.

·   25 percent of the GDP of African states lost to corruption every year, amounting to $148 billion, but the problem is seen in all continents.

·   Corrupt money associated with bribes received by public officials from developing and transition countries is conservatively estimated at $20 billion to $40 billion per year—a figure equivalent to 20 to 40 percent of flows of official development assistance (ODA).

(Please see Stolen Asset Recovery Initiative: Challenges, Opportunities, and Action Plan, p. 11)

 

Development benefits of asset recovery (see p. 11)

Every $100 million recovered could fund:

·         First-line treatment for over 600,000 people with HIV/AIDS for a full year; or

·         50–100 million in drugs for the treatment of malaria; or

·         Some 250,000 water connections for households.

Country cases:

 

·   After an 18 year saga which ended in January 2004, the Philippines were able to repatriate $624 million of Ferdinand Marcos money held in Swiss Bank accounts.

·   Between August 2001 and 2004, Peru recovered nearly over $180 million stolen by Vladimiro Montesinos from several jurisdictions such as Switzerland, Cayman Islands and the United States.

·   Between September 2005 and early 2006, Nigeria recovered $505 million of the Sani Abacha money frozen and forfeiture by Swiss authorities.

·   In July 2006, British authorities returned $1.9 million of the allegedly illicit gains of Diepreye Alamieyeseigha, governor of the oil-rich Bayelsa state in Nigeria.

·   In May 2007, an agreement between the governments of the United States, Switzerland and Kazakhstan allowed for the repatriation of $84 million.

·   While the recent experiences of Nigeria and Peru have taken an average of five years to achieve positive results, asset recovery is a time consuming process which can impose a huge toll on the credibility and sustainability of the efforts, not to mention seriously undermine the political will to endure this task.

Ratification of the UN Convention Against Corruption (see page 15)

 

·   Half G8 countries have ratified UNCAC. Canada, Germany, Italy and Japan have not.

·   Half of OECD countries have ratified UNCAC.

·   13 of the 54 jurisdictions classified by the IMF as offshore financial centers (OFCs) have ratified UNCAC. Source: World Bank

The role of the West in promoting corruption & poverty in Africa

Europe and North America have had it both ways. They condemn corruption abroad, be it officials taking bribes or looting the funds of their poor countries, and then tolerate their Banks who make fortunes off that Corruption.

The banks that received Abacha’s $4 billion stolen funds are: Australia and New Zealand Banking Group, ANZ, London Branch; Bank Len, Zurich; Bankers Trust Company, London; Bankers Trust Company, Frankfurt; Bankers Trust Company, New York; Banque Barring Brothers, Geneva; Bank in Liechtenstein A. G. Vaduz; Barclays Bank, New York; Barclays Bank, London; Banque Edouard Constant, General; Banque Nationale De Paris, Geneva; Banque Nationale De Paris, London; Banque Nationale De Paris, Basle; Citibank N. A. London; Citibank N. A. New York; Citibank N. A. Luxembourg; Citibank Zurich; Credit Lyonnais , New York; Credit Suisse , New York; Credit Suisse, General; Credit Suisse, Zurich; Deutche Morgan Grenfell, Jersey; FIBI Bank (Schweiz) A. G. Zurich; First Bank of Boston , London; Goldman Sachs and Company, Zurich; Gothard Bank, Geneva; LGT Liechtenstein Bank, Vaduz; Liechtenstein Landesbank, Vaduz; M. M. Warburg and Company, Luxembourg; M. M. Warburg and Company,Zurich; M. M. Warburg and Company, Hamburg; Merrill Lynch Bank, New York; Merrill Lynch Bank, Geneva; Midland Bank, London; National Westminister Bank, London; Paribus, London; Paribus, Geneva; Royal Bank of Scotland , Leeds; Standard Bank London Limited, London; UBS AG, Zurich; UBS AG, Geneva; Union Bancaire Privee, Geneva; Union Bancaire Privee, London; London Branch; Verwaltungs Und Private Bank A. G., Vaduz; and ANZ, New York; ANZ, Frankfurt.

Some of these same banks have been accused of aiding Mobutu Sese Seku, Lansana Conte, Arap Moi, Omar Bongo, Obiang Nguema, Denis Sassou Nguesso,Eduardo dos Santos and a host of others in looting their countries.Are these banks sincere partners of the global community? Can't the ICC bring charges against them for committing crime against humanity?
The Corruption Perception Index (CPI) ranks the countries of Africa as the primary locus of corruption, but it ignores the global infrastructure of international financial secrecy that has helped bleed trillions of dollars in illicitly generated money not only out of Africa but also out of the Middle East, Latin America and Russia into the financial centers of the richest countries in the world especially Britain, Switzerland, Lexumbourg, Austria, Liechstentein and in France where Omar Bongo, Obiang Nguema, Denis Sassou Ngeusso and a host of African leaders have bought several properties using funds stolen from their countries.

Ineffective Western laws partly to blame for corruption in Africa

The U.S. Foreign Corrupt Practices Act (FCPA) of 1977 followed both the Watergate scandal, which helped create the right political climate, and a series of investigations revealing that more than 400 corporations had admitted paying $300 million to foreign government officials to win projects. Most of these foregn government officials were in Africa.Yet the FCPA did not trigger a decisive shift in global policy debates, since other countries did not follow America’s lead. After 1977, companies from Germany, France, Britain and other countries still did business as before, gleefully corrupting foreign and domestic officials to steal contracts from under the noses of their more squeamish American competitors. We had lied to nearly everyone, lies that were quickly exposed. Some of those lies to the U.S. Congress, covering up what we had done, amounted to perjury and could have been prosecuted as such. We had allied the United States with South Africa in military activities, which was illegal and impolitic. We had delivered white mercenaries into Angola to kill blacks as a technique of imposing our policies on that black African country. Meanwhile, we-not the "Communists"-had interfered with U.S. commercial interests. We had withdrawn Boeing Aircraft Corportion's licenses to sell five jetliners to the Angolan airlines, and we had blackmailed Gulf Oil Company into putting its $100 million payments in escrow instead of delivering them to the Bank of Angola. We had poisoned the missionaries' efforts to run vital schools and hospitals.

SWISS BANKING SECRECY UNDER FIRE



BANKING SECRECY

Banking secrecy is far from being a simply Swiss phenomenon. The European Commission is also targeting Belgium, Luxembourg and Austria. The Organisation for Economic Cooperation and Development also considers that Andorra and Monaco are non-cooperative tax havens, whereas Liechtenstein has cooperated with the EU since last year.

Banking secrecy is limited in Britain and the US but the two countries do have territories where it is less restrictive. Singapore has drafted plans in the general direction of the OECD. But when it comes to Hong Kong, China is deaf to EU demands for more transparency.

It must be noted that development has evaded Africa and most of third world countries due to the existence of banking secrecy which allow corrupt politicians to loot the coffers of their countries.Swiss banks have been accused of accepting money from people like Sani Abacha, Mobutu, Eyadema, Arap Moi, Omar Bongo, Obiang Nguema, Blaise Campore, Denis Sassou Ngueso, Eduardo dos Santos, Sadam Hussein, Ferdinand Marcos without questioning the source of their wealth.The former dictator's estate near Lausanne

The former dictator's estate near Lausanne (Keystone)

A buyer has finally been found for the Swiss retreat of the former Zairean dictator, Mobutu Sese Seko.

The villa in Savigny, canton Vaux, went to a Swiss buyer for SFr3.1 million during an auction on Thursday.

Local authorities had previously received written offers to the value of SFr2.5 million, the minimum price set at a previous auction, although the property is estimated to be worth considerably more at SFr4.25 million.

The villa of the former president of the Congo, who died in Morocco in 1997, was impounded in May 1997 at the request of judicial authorities in Mobotu’s homeland.

Cars and furniture inside the house were sold off in June, raising SFr270,000.

It is not yet clear whether the proceedings of the sale will go the Democratic Republic of Congo or to Mobutu’s estate.

swissinfo with agencies

Switzerland has failed to return Mobutu's looted funds

The Swiss government, backtracking under public pressure, promised today to widen a hunt for what is alleged to be billions of dollars belonging to Zaire's embattled ruler, Mobutu Sese Seko.

The government previously said an informal survey of Swiss banks had found no trace of Mobutu's controversial fortune, estimated by Swiss media to total about $4 billion spread among secret bank accounts in the Alpine republic. A Swiss newspaper reported last weekend that one of Mobutu's sons regularly gave his business partners a Swiss account number when he did business for himself or the family.The Federal Banking Commission, the country's banking watchdog, said it will expand its investigation to locate all the money. From Washington Post

Despite the promise to find all the money, Swiss authorities have failed to do so.

ASSET RECOVERY

A recent European Commission report estimated that “stolen African assets equivalent to more than half of the continent’s external debt are held in foreign bank accounts”.1 Following the international legal precedent set by the Holocaust Claims Commission in recovering assets stolen from the Jewish people by the Nazi regime, some African leaders have begun to focus on the repatriation of these looted African assets as an important element of anti-corruption efforts. Asset recovery is fraught with the complicity of the banks involved, the navigation of a costly international legal labyrinth and the fact that those most implicated in public looting usually have the most power and influence.By  Daniel Scher. 
Read full article on www.iss.co.za

MOBUTU'S STOLEN ASSETS STILL FROZEN

Mobutu assets stay frozen

The Swiss government has once again extended the freezing of assets deposited in Swiss banks by the late president of Zaire, Mobutu Sese Seko.

The deadline for returning the assets worth around SFr8 million ($6.54 million) to Mobutu's family has now been pushed from February 28 to April 30 to give legal authorities more time to work on the case.What do Mobutu, Abacha, Omar Bongo, Obiang Nguema, Denis Sassou Nguesso, Jose Eduardo dos Santos and Lansana Conte have in common? Their bankers. All leaders have numbered Swiss, French, British accounts in order to deposit ill-gotten gains. Why? Bank secrecy.

Fighting Corruption to Reduce Poverty

Anytime money is stolen from the people,roads, schools,hospitals,bridges, silos, irrigation facilities,rail lines,harbours are not built and poverty get increased. But anytime corruption is stopped the economy begins to grow and poverty begins to go down. Therefore let us name and shame those who make fortunes out of the poor people. Let us support those who take the risk to name and shame corrupt officials in their mist.

Swiss Banks Again

The Swiss government has agreed to freeze accounts in UBS banks of former Haitian dictator Jean-Claude Duvalier following a request by two Haitian plaintiffs, reports AFP (Feb. 6, 2008). "We obtained the sequestration of the funds in Basel (Switzerland) in early January," said Mark Henzelin, lawyer for the two plaintiffs--a priest and a taxi driver--told the Swiss ATS news agency.$6.2m was stolen and kept in Swiss banks by the former Haitian leader.

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