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Monthly Archives: August 2012

Femi Falana Indicts World Bank For Grand Corruption In Nigeria, By Abiodun Oluwarotimi, Leadership, Nigeria, 21 August 2012


 

Human Rights lawyer, Barrister Femi Falana (SAN) has accused the world bank for grand corruption in Nigeria.
According to the human rights lawyer in a statement obtained by our New York Correspondent on Tuesday, the World Bank has just issued a damning report which claimed that 80% of Nigerian businesses offer government officials bribe to facilitate deals.
“While recognising that Nigeria remains the most attractive investment destination in África the report noted the high proclivity for bribery and corruption among Nigerian businesses. Although  the report may be an understatement of the rate of endemic corruption in Nigeria  the World Bank has failed to trace the root cause of the menace. Hence the Bank is not prepared to suggest  measures that can arrest the growing wave of corruption in the country”

“No doubt,  there was corruption in Nigeria up to the 1980s. But it was not so prevalent at the time because the State funded the welfare of the majority of the people, provided social services at affordable costs  and created jobs for the unemployed. Education was virtually free while health services were affordable. The Naira was higher than the United states dollar in the foreign exchange market”

“Although it was a neo-colonial capitalist economy which enriched a few at the expense of the nation there were some safety nets for the masses. The Nigerian Government placed emphasis on the building of an egalitarian society in line with the extended family system of the African people”Falana further said that: “However,   the introduction of the Structural Adjustment Programme which was instigated by the World Bank and the International Monetary Fund ruined the Nigerian economy completely and destroyed the morality of the society.

With retrenchment of workers, abolition of marketing boards, commercialisation of social services, sale of the assets of the nation, trade liberalisation, currency devaluation and other dangerous components of SAP mass poverty became the order of the day”
“The middle class was  wiped out while the manufacturing sector became extinct. In the process corruption became the directive principle of state policy under the Ibrahim Babangida junta. Successive regimes have since then consolidated on official corruption”He continued that a from  condemning corruption the World Bank and Western Governments including the Barrack Obama Administration have continued to insult the African people on the issue of corruption, stressing that stolen wealth from Nigeria and other third world countries to the tune of over a trillion dollars  is received and kept in the vaults of western banks in violation of the provisions of the United Nations’ Convention Against Corruption.

“For instance,  the British judge who jailed Chief James Ibori, ex-governor of Delta State made racist remarks as if Africans are congenitally corrupt. But the British banks and mortgage institutions which facilitated the suffering of the people of Delta state through money laundering and fraud by Chief Ibori  were not sanctioned”
“Was the governor of Illinois, Mr Rod Blagojerich not jailed for selling Barrack Obama’s senate seat in Chicago? Has the World Bank held the American Government vicariously responsible for the criminality of its officials” he said.”With respect to corruption in Nigeria why has the World Bank not condemned foreign companies like Halliburton, Wilbros, Siemens, Julius Berger and others  which have been indicted and penalised for perpetrating for large scale corruption in Nigeria?

The NEITI has just disclosed that foreign oil companies have duped  Nigeria to the tune of over $2 billion. Instead of assisting Nigeria to recover such huge fund the World Bank would prefer to package  jumbo loans for the Federal Government with fraudulent conditionalities.
Why has the World Bank not supported the current Minister of Agriculture, Dr Akinwumi Adesina who is determined to arrest the reckless importation of food at billions of dollars per annum”Barrister Falana also warned the World Bank to stop writing hypocritical  reports on corruption emanating from the neo liberal policies being sheepishly implemented by the Federal and state governments at its own behest, adding that the Goodluck Jonathan Administration should be told that  no Government which operates an economy on the basis of market fundamentalism can curb corruption.

“This is the basis of the virtual collapse of the economy of Portugal, Italy, Greece and Spain (the “PIGS”)which has defied the prescriptions of the World Bank and the  International Monetary Fund”
 
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Posted by on August 21, 2012 in Uncategorized

 

Mali forms new caretaker government, By Tiemoko Diallo, Reuters Africa, 21 August 2012


Mali's interim President Dioncounda Traore (C) arrives at the main airport in the capital Bamako, July 27, 2012. REUTERS/Adama Diarra
BAMAKO (Reuters) – Mali’s interim president Dioncounda Traore approved a new transitional government on Monday, to move the West African country closer to constitutional order after a military coup in March.

The 31-member government will replace a transitional authority that was crippled by political infighting, and failed make progress in setting elections.

“The president of the republic, after receiving proposals from the prime minister, decrees the list of members of government,” said a presidential statement read over state radio.

The statement said the holders of five posts in the new transitional government had been chosen by the military leadership. It said at least four members of the previous transitional authority, including the interior minister charged with organising elections, remained unchanged.

Once considered a democratic success story in a long-troubled region, Mali has been split in two since a March 22 coup paved the way for a military advance by northern separatists and al Qaeda-linked Islamists.

West African regional bloc ECOWAS, which is pushing for the deployment of a 3,000-strong intervention force in Mali, had called on Traore to ensure the formation of a government that better represents Mali’s different interests.

While the coup was condemned abroad, the reaction in cotton and gold producing Mali was mixed, with some praising the removal of a political class they said was corrupt.

Traore had reappointed his prime minister, Cheick Modibo Diarra, on August 12 and asked him to form a new government within 72 hours.

 
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Posted by on August 21, 2012 in Uncategorized

 

World Bank unit says concerned with SAfrican mine violence, Reuters Africa, 21 August 2012


WASHINGTON (Reuters) – The International Finance Corp, the World Bank’s private investment arm, said on Monday it was “deeply concerned” with violence at Lonmin’s Marikana platinum mine in South Africa and urged parties to settle their differences through negotiation.

IFC holds a 0.61 percent equity stake in London-based Lonmin Plc through an investment made in 2006. Lonmin accounts for 12 percent of global platinum output.

Forty-four people have been killed at the Marikana mine, including more than 30 striking miners who were shot dead during a confrontation with police last week. The shooting was one of the bloodiest police actions seen since the end of apartheid in 1994.

“The issues are serious and IFC encourages all parties to resolve the dispute through constructive dialogue and negotiation,” IFC said in a statement.

 
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Posted by on August 21, 2012 in Uncategorized

 

Liberia president suspends son in assets investigation, By Alphonso Toweh,Reuters Africa, 21 August 2012


MONROVIA (Reuters) – Liberian President Ellen Johnson-Sirleaf has suspended her son and 45 other government officials for failing to declare their assets to anti-corruption authorities, in her first major step to battle graft in her administration.

Charles Sirleaf, one of three of the president’s sons appointed to government posts, was suspended from his position as Deputy Central Bank Governor.

Corruption is seen as a big obstacle to development in the West African state, which remains one of the world’s poorest countries nearly a decade after the end of a 14-year civil war.

The suspensions come amid growing concern about government graft in Liberia, which is a nascent iron ore producer and has attracted international energy companies such as Chevron, seeking to develop its offshore oil blocks.

“President Ellen Johnson Sirleaf has, with immediate effect, suspended 46 government officials,” said the statement, issued by the presidency late on Monday.

The statement said the officials could be reinstated after they declared their assets to the commission.

The other sons of the president in government posts are Robert Sirleaf, senior adviser and chairman of state oil company NOCAL, and Fumba Sirleaf, head of the National Security Agency.

Johnson-Sirleaf, who jointly won the Nobel Peace Prize last year for her role in maintaining peace in Liberia after the war, was Africa’s first elected female head of state when she came to office in 2005. She was re-elected for a second term late last year.

 
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Posted by on August 21, 2012 in Uncategorized

 

South African police fire on striking miners, 18 killed


 
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Posted by on August 16, 2012 in Uncategorized

 

Solving Energy Poverty in Sub-Saharan Africa, By Matthias Chika Mordi of Diplomatic Courier, 15 August 2012


With its high poverty levels and low degree of industrialization, Africa arguably faces the largest development gap of any region. Beyond the usual misery indices and welfare evaluation metrics, we have fundamental challenges that impede meaningful sustainable development. Energy is an incontrovertible challenge across sub-Saharan Africa (SSA).

Data from the World Bank and International Energy Agency (IEA) on energy poverty does not make for good visuals. Two out of three of SSA households—585 million people—live without electricity. In stark contrast, 99 percent of North African households have electricity supply. Only 14 percent of rural SSA households are linked to the grid. This compares unfavourably with Latin America where 74 percent of rural households are connected to power. The figures mask a more disturbing fact about electricity supply in most SSA countries: a high frequency of blackouts and unstable power supply. The World Bank estimates that SSA households experienced 91 days of blackouts in 2007.Beyond low electrification, energy poverty extends into inefficient and perilous forms of domestic energy for cooking attributable to a lack of modern fuels and clean cookers. According to IEA reports, more than 80% of SSA households—653 million people—use biomass for cooking, with devastating consequences for people and the environment. In 2009, more than 1.45 million African lives were lost to household pollution caused by inefficient biomass cooking stoves. Fewer people died from malaria.

Business and Household Implications

The most inimical constraints faced by SSA businesses and households revolve around inadequate social infrastructure: electricity, water, communication services, security and transportation. Whereas businesses and households on other continents have come to take these services for granted, for African economic units, they remain prohibitively expensive, inadequate and, in some areas, unavailable.

As a rule, most businesses in my native Nigeria provide a large portion of their own utility services—sometimes pooling with others, but often solo—with dramatic implications for business viability. If you conflate these “extraneous” costs with extant country-specific costs, then the threshold for business viability escalates to deleterious levels.

To illustrate this phenomenon, let’s consider a glass manufacturer I helped raise capital for a few years ago. For confidentiality reasons, let me label it company X. The company, located near a port city in Nigeria, had as primary competitors two ailing local manufacturers and low-cost exporters from South East Asia. On paper, company X should have been very competitive given its seaport location, locally abundant primary raw materials, low real interest rates, and proximity to the domestic market. In reality, its products were uncompetitive with imported products.

Glass manufacturing requires blasting a furnace round the clock, every day of the week. Shutting the furnace abruptly or too quickly could result in very expensive damage. It also requires copious amounts of water for cooling. Since the public grid is epileptic, fluctuates when available and was believed destructive for sensitive equipment, Company X built its own electricity generation capacity. Two plants—each with 150 percent of the required capacity—ran in sequence as the primary energy source. The public grid served as back-up power for none-core equipment. The company also installed a large fuel storage tank and maintained a three-week fuel reserve as a necessary buffer against perennial fuel shortage. The story continues. Company X built a borehole, water treatment, and distribution equipment for the factory. It also required certain industrial chemicals as additives in the production process. These chemicals cost roughly the same in South East Asia, however, shipping costs (in 2010 Nigeria had the second-highest shipping insurance costs on earth) and an obtuse clearing process at the port, spiked the costs. In the final analysis, Company X’s products cost significantly more than its foreign competitors in the domestic market without an appreciable quality advantage. Without tariff protection, its performance outcomes fell below projections.

The Energy Challenge

A similar narrative exists with small businesses and households. These economic units face challenges in energy supply, potable water, transportation, and—in urban areas—security. While the more affluent households have power generators, boreholes, and private security arrangements, poorer households—which happen to comprise the majority—live with dilapidated public utilities or pre-modern forms of energy supply. Increasingly available mobile communications, Internet access, and school enrolment, convolve to increase the need for domestic energy. Today, more than one in two Africans owns a cell phone (ITU data 2011) and the attendant energy requirement for charging handsets. In a similar vein, more than two of three children are enrolled in school and often need lighting to read at night. There are also a multitude of public and private projects across the region that aim to increase computer usage, ownership and Internet access. Increasing urbanization, high urban poverty levels, urban congestion, scarcity and cost of modern fuels have deepened the energy challenge households face for cooking.

Middle-income households and small businesses have either adapted through a bewildering array of sub-optimal solutions or avoided certain modern necessities entirely.

Energy and the Environment

There is a temptation to accept the notion that low environmental standards are permissible for countries at a lower stage of development. Some emerging market nations—notably China—have argued for exemption from environment protection requirements applicable to OECD nations. Their contention is premised on (i) equity and (ii) development necessity. The equity argument is philosophical at its core. In this paradigm, wealthy industrialized nations produced the preponderance of historic pollution, either in absolute terms or on a per capita basis. Wealthier nations should therefore bear a proportional portion of emission reduction. Development necessity is a more tenuous argument, given the state of technology today. It is difficult to subscribe to the nation that large-scale development is incompatible with rigorous environmental standards. I believe the following ingredients can catalyze environmentally friendly development: intelligent engineering and design; sound public policy; pragmatic regulatory frameworks; and, stakeholder education.

Domestic Energy Solutions

Decades of planning, international conventions, and development aid have failed to resolve the energy challenge for SSA. If we borrow a leaf from the telecommunications industry, growth and access to communications occurred when the public sector relegated its role to mostly regulation and opened up the industry to private business. Furthermore, technology enhanced the scalability and unit cost of mobile telephony to overcome constrains earlier faced by fixed telephony infrastructure.

Today, scientists have made significant advancements in affordable and clean domestic energy solutions. American researchers continue to create ingenious designs that use a diverse range of energy sources—solar, biomass, fossil fuels, chemicals, and hydro—that can provide domestic energy at affordable costs. The challenge is commercializing these ideas by providing manufacturing scale, distribution, and logistics competence.

The prospective market is huge. At Viridis Energy, we project 180 to 300 million SSA consumers can purchase capital products that will provide domestic lighting, low electricity and cooking needs. Our vision is to provide affordable, clean retail energy solutions to SSA households and small businesses. We are currently building a pipeline of partnerships with innovative individuals and institutions to provide retail energy solutions. We have commenced relationships with researchers, industrial designers and an academic institution with a view to bringing two innovative retail products to market by first quarter 2013. Our criteria for product development qualification are simple: A product concept must be affordable, environmentally neutral and easy to transport. We are currently building distribution, support and marketing channels in Nigeria, Ghana, and Kenya.

We are optimistic that private sector involvement in investment, and healthy policy contestation and collaboration with governments and non-profits, would secure energy supply without worsening climate change. Market-driven measures can improve lighting, access to power, clean cooking facilities and ultimately lead to a massive reduction in energy poverty.

Matthias Chika Mordi spent over two decades in the finance industry across Africa where he led and co-led the turnaround of three ailing financial institutions. The most notable one is United Bank for Africa PLC, now one of Africa’s largest banking groups.

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Posted by on August 16, 2012 in Uncategorized

 

World Bank under fire over Ethiopian dam, Author: Charlene Vasseur /sh, Editor: Asumpta Lattus,DW Germany, 16 August 2012


The Gibe III dam in southern Ethiopia is a controversial project. Now the World Bank has come under fire over its plans to finance a power line from Ethiopia to Kenya which critics say could be fed by the dam.

Lake Turkana stretches from southern Ethiopia deep into northern Kenya. It is the largest lake in an arid region. But there are fears that time is running out for the biotope on which hundreds of thousands rely for their water needs. The threat comes from Gibe III, a hydroelectric dam project in southern Ethiopia. The plan is to dam the Omo River which flows into Lake Turkana, in order to provide electricity for more than 200 million people in five countries. The dam project, the highest in Africa, has already been delayed and is now scheduled to start operating in 2014.

High demand for water

Samuel Maina doubts whether there will be enough water in the dam by then. He is a communications advisor with the Kenyan organization “Friends of Lake Turkana” which since 2008 has been working to protect the lake. As a result of climate change, rainfall in the region has decreased, Maina says. And if the water remains in the dam, then the level of Lake Turkana could fall.

Turkana women catching fish ((ddp images/AP Photo/Karel Prinsloo)</p><br />
<p>90 percent of Lake Turkana lies on Kenyan territory

“There is also the issue of sugar cane and cotton plantations down river which have been implemented by the government of Ethiopia and international farming companies,” he said.

The sugar cane and cotton plantations are monocultures which require large amounts of water. That means that less water remains for the river and environmentalists warn that many plants and animals could become extinct. There would also be insufficient water for the local population. An estimated 200,000 people would be affected by the dam. According to the “Friends of Lake Turkana”, people living in the Omo valley are being forcibly resettled. They say some have been arrested and even murdered for protesting. Many people are not satisfied with the land that is being offered as compensation.

Consequences for Kenya

The reduction in the amount of water flowing from the Omo River has severe consequences for people living alongside the Turkana Lake in Kenya. 90 percent of the lake lies on Kenyan territory.

Some people depend on fishing for their livelihood, others keep livestock and also depend on the grass that grows in the area, Samuel Maina says.

“Without the lake they are without any livelihood. There are also problems on the other side, in Ethiopia. People are being moved out of their ancestral land to pave the way for the sugar plantations. There is already a lot of conflict between Ethiopian communities and Kenyan communities, and within Ethiopian and Kenyan communities.”

World Bank involvement

Among the organizations funding Gibe III at the start of the project was the World Bank (WB). However, citing a lack of transparency, it withdrew its support.

Omo River valley  (Photo JENNY VAUGHAN/AFP/GettyImages) </p><br />
<p>Environmentalists fear for the Omo River valley

In July 2012 the WB decided to finance a 1,000 km-long (621 miles) power cable from Ethiopia to Kenya. In a press release, it said the project would “connect Ethiopia’s electrical grid with Kenya’s, create power-sharing between the two countries, reduce energy costs, promote sustainable and renewable power generation, better protect the region’s environment, and pave the way for more dynamic regional cooperation between the countries of East Africa.”

For the critics, there’s no doubt that this cable would be used to transport power from the controversial dam. Lucio Monari is the sector manager of the World Bank’s Africa Energy Group, based in Washington. He regards the criticism of the planned power transmission line as unfounded, saying it is not dependent on the dam. He says 44 power plants feed the Ethiopian electricity network and, with it, the power line to Kenya. “There is no specific link to the Gibe III dam” Monari maintains, adding “we have also done analysis that even if Gibe III was not built, the interconnection would still be viable. There would still be power available for the national grid as well as for export to Kenya.”

NGOs and numerous environmental protection organizations disagree. Among the critics is Jessica Evans, senior researcher for international financial institutions with Human Rights Watch (HRW). She told DW that “HRW has been told by the World Bank that Gibe III would be one of the power sources. Unfortunately, even though the World Bank is recognizing that it will be one of the power sources, they are not willing to apply the safeguards, the policies that are meant to ensure against human rights abuses.”

The Ethiopian government and the World Bank argue that the new power transmission line will bring urgently needed power to countries in the region. But for opponents of the plan, the price is too high, if it includes driving people from their homes and damaging the environment.

 
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Posted by on August 16, 2012 in Uncategorized

 

Wall Street’s Frightening and Predatory Land Grab in Africa, By Imara Jones, Colorlines.com, 15 August 2012


The nation’s financial sector is on a crusade to dominate an irreplaceable African resource that the world increasingly needs: massive tracts of open land available for large scale industrial farming. The pace of land purchases is flying so furiously that it is now commonly referred to as “a land grab.”

It’s the latest phase in Wall Street’s never-ending quest for profits at-any-cost, but this time the focus of finance’s predatory gaze is the world’s poorest region. The reason is simple: There’s an ocean of money to be made by doing so.

The potential riches stem from the fact that the world needs more food. For Wall Street, scarce resources translate into massive profits, and U.S. financial firms are at the head of the pack to make them.

Global population growth, the rise of middle class diets in fast-developing economies, especially China and India, and falling crop yields due to climate change mean that the planet is in a scramble to increase agricultural output. This year’s drought highlights the problem.

Most of the land available to meet this growing demand is in the world’s most distressed regions, especially in Africa and to lesser extent Latin America. Buying, leasing, and selling that land is expected to lead to double-digit returns for investors—the type of returns seen in high-growth, high-tech companies. And financiers all around the world are beating down the door to get their hands on it.

These acquisitions are another example of the way in which the financial system thrives off of inequality, both internationally and here at home.

This should come as no surprise. It’s not the first time that the financial sector has put short-term gains above all else.

Wall Street’s unapologetic avarice during the housing bubble led to the largest erasure of wealth amongst the descendants of Africa and Latin America living in the United States. Due to the housing crisis, the wealth gap between people of color and whites has grown to the widest level ever recorded. The devastating loss in property and prosperity amongst blacks and Latinos is a direct result of Wall Street’s assessment that these communities were ripe for predation.

Now they’re profiting from the mess they created by snapping up distressed properties for profit.

In Africa and around the world, Wall Street banks on inequality.

A Continent for Sale, Yet Again

Oxfam estimates that over the past decade up to 560 million acres of land, equivalent to the size of Western Union, has changed from local control in the developing world to the hands of global investors. The World Bank says that 112 million acres switched ownership in 2009 alone. Seventy percent of those deals were in sub-Saharan Africa. These deals are occurring in such volume that no part of the continent is immune.

The U.S. is the largest investor. Household names such as Goldman Sachs and JP Morgan all have their fingers in the pie, along with others such as Black Rock asset managers.

The size of individual transactions is huge.

According to a detailed report by non-profit GRAIN, close to a million acres was leased by a New York-based private equity firm from the world’s poorest and newest country, South Sudan. The same report says that a fund controlled by George Soros owns 600,000 acres of land in Brazil, Argentina and Uruguay.

The land grab is not accidental. Conferences, organized by firms like High Quest Partners, are held in New York, Singapore, and London to facilitate deal and capital flow to Africa. High Quest reports that 700 hundred attendees participated its New York gathering alone to get the latest on the land rush.

Most open land in Africa is owned by the government. As national property, millions of Africans presently farm it without owning the land or paying rent.

Weak taxation, caused by lower levels of economic growth and poor governance structures, lead African governments to constantly look for new sources of income to fund their operations. Selling or leasing a national asset, land in this case, is a logical step to raise badly needed cash. Many countries around the world, including the United States, have done it. The Democratic Republic of the Congo, for instance, has offered to lease up to 20 million acres to international investors.

The problem is that deals are done for pennies on the dollar.

The Oakland Institute says that purchase prices can range from as little to $3 to $6 an acre. Leases can be for up to 99 years at $0.75 an acre. Farmland in the U.S. sells for $560 to $12,000 an acre.

Dirt cheap land prices in Africa lead to massive profits on Wall Street. The margins made on these land acquisitions will range between a whopping 20 and 40 percent. This is two to four times above what is considered an amazing return; anything above 10 percent and finance types are gleeful.

Profits are turbocharged because the true costs of converting lands from public use to private, industrial farm purposes is not born by the firms that purchase them.

Environmental degradation from factory farms and increased poverty, caused by the forced removal of millions from native land and into overburdened cities, are among the long-term tolls of Wall Street’s “land grab” that are not paid for by the companies that initiated and benefit from it.

Hundreds of pounds of chemical fertilizer are used in industrial agriculture to increase crop yields on just one acre. Data from Sustainable Table indicates that an industrial hog farm produces up to 200 million pounds of waste per year. Over 700,000 people in Ethiopia are in the process of being moved to make way for just one land deal.

These environmental and human costs will be shouldered by the ecosystems and people who are the victims of them. As with the U.S. housing crisis, costs are socialized and the benefits privatized. This seems to be Wall Street’s formula for making the numbers work.

Given the bargain basement prices and future food demand, buying, holding and cashing out on land in Africa is money in the bank for investors.

Black and Brown America’s ‘For Sale’ Sign

So is the wreckage from the foreclosure mess caused by Wall Street.

Over 9 million property foreclosures flowed from the bursting of the housing bubble in 2008, and 3.6 million of these, more than four out of ten, were owned by blacks and Latinos.

Just last month, Wells Fargo settled with the Justice Department on charges that it deliberately steered people of color into toxic subprime loans. These loans set up borrowers, whom loan agents referred to as “mud people,” for failure.

As a result of the foreclosure process that followed, millions of properties have been transferred from black and brown individuals to banks, hedge funds, and other financial institutions, which are turning them around at a profit.

Property is the number one way that people of color build wealth. Blacks and Latinos hold fewer stocks, bonds and other financial assets. Consequently, rising property values is an even more important source for net gains in those communities over time. The $7 trillion in home real estate values that has been erased since the 2008 crisis are felt disproportionately on the balance sheets of blacks and Latinos.

A generation will likely pass before hard hit communities recover what was lost. But banks and hedge funds, including those grabbing land in Africa and Latin America, stand to profit from the mess they created.

All over the world, Wall Street is at work to separate millions of people from their property at a dizzying pace. Delivering returns to their shareholders means doing whatever is necessary to the rest of the population in order to achieve them.

Once bearish Goldman Sachs is now bullish on the U.S. housing market. Since late last year, financial institutions have started to buy distressed properties. Forbes reports in that just in the last 10 days a $1 billion fund was created to snap up foreclosed houses, apartments and condos to transform them into rentals.

Due to the actions of Goldman Sachs and others which precipitated the current crisis, millions of former black and brown home owners now need those rentals. In fact, demand for rental properties is at all time high. In some markets, like New York City and San Francisco, rents have soared to pre-crisis levels.

Americans have lost at every stage of the sub-prime process, but the financial sector gains. No matter where or who—Africa, Latin America, or amongst African Americans or Latinos in the United States—Wall Street manages to prosper from inequity and wrongdoing.

No one has held them account for it yet. Just last week, the Justice Department declared that it wouldn’t prosecute Goldman Sachs for its role in the subprime mess. In response to a recent question over whether Wall Street should answer for its egregious deeds, JP Morgan’s Chair Jamie Dimon shouted, “It’s a free fucking country.” He and his fellow financiers don’t seem to get the distinction between being free and getting off scott-free. For them, they’re one in the same.

“The same financial firms that drove us into a global recession by inflating the real estate bubble through risky financial maneuvers are now doing the same with the world’s food supply,” warned the Oakland Institute’s Executive Director Anuradha Mittal on CNN.

She’s right.

Africa’s and America’s experience with Wall Street shows that predatory behavior not only abounds, but may be endemic to the way the financial sector does business.

The only way to minimize the damage, barring muscular regulation not seen in 40 years, is to cut the banks down to size.

Everyone from the nation’s former chief banker, Paul Volcker; to the Godfather of the nation’s first too-big-to-fail institution, former Citigroup Chair and CEO Sandy Weill, have called for it. Weil recently said that the time had come for the mega-banks to be “split up.” Even President Obama has signaled support for it. But it hasn’t happened yet.

Whatever the reason, the failure to bring the financial sector to heel has global consequences, especially for those that have historically been least able to afford it.

Imara Jones writes about economic justice for Colorlines.com.

 
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Posted by on August 15, 2012 in Uncategorized

 

Arming Local government in Africa against the global financial crunch , By Chofor Che, 15 August 2012


The International Monetary Fund (IMF) recently reported that global economic recovery is still at risk. According to the IMF, Eurozone countries are still in a ‘precarious’ situation, and a delay or inadequate response from leaders in European and African countries to the crisis would further distort the recovery.

The IMF stepped down its forecast for global growth and improvement for 2013 from 4.1% to 3.9%, a prediction that it had earlier made in April 2012. The IMF’s forecast for World output this year – as measured by gross domestic product – was little changed at 3.5%.

According to the IMF’s updated World Economic Outlook, which is published twice each year, ‘Downside risks continue to loom large, importantly reflecting risks of delayed or insufficient policy action’. This IMF publication adds that, if European leaders do not take serious action to avoid the sovereign debt crisis from mounting and prevent a market meltdown; the Euro area will remain in a ‘precarious’ situation. Municipalities in Africa would definitely be affected by such a precarious situation.

Tacking this financial crisis is particularly urgent since it occurs at the level of government where many Africans receive essential services, such as water and electricity, which have a significant influence on their quality of life. One of the main reasons why local governments have failed in service delivery in the wake of the global crisis is because even though they have the greatest potential for being effective, they are the furthest removed from the central authorities and the donor community. Most local governments in Africa like those of Cameroon and Zimbabwe are yet to be administratively and financially autonomous. There is also no intergovernmental relations between local government and other spheres of government in these countries.

Slashing local government budgets in the case of a fiscal shortfall means cutting back on essential services such as health care and quality water supply. In Swaziland for instance, supplies of anti-retroviral drugs to local government, has been slashed by central government as a result of the global financial crunch, especially as donors have cut back on the assistance they used to give to this country towards fighting the HIV/ AIDS pandemic.

For African economies to be able to survive the global economic recession, it is time to reflect on effective monetary policies as well as measures on encouraging trade among African nations. One of such ways is the twinning of municipalities in Africa as well as other parts of the world, so as to boost the participation of local government in international issues traditionally reserved for central government like international business. This would definitely entail lessening the numerous trade barriers that exists among African nations.

It is also important for the powers including administrative and financial powers of local government in Africa, to be constitutionalised. In this way, local government will be able to make effective decisions affecting the local populace in essential service delivery areas such as health care and water supply. Autonomy to local government does not mean that there should be no supervision of this sphere of government especially by regional government. Local government should be supervised without any usurpation of powers.

There is also need for municipal personnel especially municipal executives like the mayors and municipal managers to be well trained and educated. One of the major reasons why municipalities have been unable to withstand the global recession is because of lack of professionalisation. The central government, the regional governments as well as other partners such as universities, need to join efforts to train municipal officials and executives.

There is also need for intergovernmental relations between all spheres of government in African states. If spheres of government in a state cooperate among themselves, combating the global financial crisis can be made easier, especially as ideas on budgeting; service delivery, as well as trade can be shared across the board.

Corruption is another canker-worm eating into the economic fabric of local government in Africa, in addition to the global economic recession. There exist numerous anti-corruption measures including lengthy legislation on the continent, but the problem of effective implementation remains the greatest dilemma. Fighting the global recession would definitely need unified efforts from governments including local governments and a serious boost from free market engineers in Africa and Europe.

If such measures are agreed upon by African leaders and effectively put in place, then African economies can survive the global economic crisis which has grossly hit hard on local government.

 
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Posted by on August 15, 2012 in Uncategorized

 

Bill Gates seeks answers in the toilet, CNN, 15 August 2012


Microsoft co-founder Bill Gates thinks one of the answers to improving health is in the bathroom.

A year ago, his foundation issued a challenge to universities to create a new toilet, launching a worldwide effort to improve sanitation.

This week the Bill & Melinda Gates Foundation announced who won the challenge.

California Institute of Technology was the big winner and was awarded $100,000 for its idea of a solar-powered toilet that generates hydrogen and electricity. The United Kingdom’s Loughborough University won second place and was awarded $60,000 for a toilet that produces biological charcoal, minerals, and clean water. The University of Toronto in Canada garnered third place and $40,000 for a toilet that sanitizes feces and urine and recovers resources and clean water.

The new commodes are being showcased at a “Reinvent the Toilet Fair” Tuesday and Wednesday in Seattle.

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Posted by on August 15, 2012 in Uncategorized

 
 
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