Thursday, July 14, 2016

British colonialism

War On Want have published a new report, ‘The New Colonialism: Britain’s scramble for Africa’s energy and mineral resources’ that highlights the role of the British government in aiding and abetting the process. 

Written and researched by Mark Curtis, the report reveals the degree to which British companies now control Africa’s key mineral resources, notably gold, platinum, diamonds, copper, oil, gas and coal. It documents how 101 companies listed on the London Stock Exchange (LSE) – most of them British – have mining operations in 37 sub-Saharan African countries and collectively control over $1 trillion worth of Africa’s most valuable resources. Under the guise of the UK helping Africa in its economic development (a continuation of the colonial paternal narrative), $134 billion has flowed into the continent each year in the form of loans, foreign investment and aid, while British government has enabled the extraction of $192 billion from Africa mainly in profits by foreign companies, tax dodging and the cost of adapting to climate change. Mark Curtis argues that an African country could benefit from mining operations by insisting that companies employ a large percentage of their staff from the country and buy a large proportion of the goods and services they procure from the country. However, World Trade Organisation rules prevent African countries from putting such policies in place. Countries could also benefit from corporate taxation, but tax rates and payments in Africa are minimal and companies are easily able to avoid paying taxes, either by their use of tax havens or because they have been given large tax incentives by governments — or often both. And when companies export minerals, governments usually do not benefit at all. Governments only benefit from exports when there is an export tax. There are almost none in Africa.

Saranel Benjamin, International Programmes Director at War on Want, says:
“The African continent is today facing a new colonial invasion, no less devastating in scale and impact than the one it suffered during the nineteenth century. It’s a scandal that Africa’s wealth in natural resources is being seized by foreign, private interests, whose operations are leaving a devastating trail of social, environmental and human rights abuses in their wake. For too long, British companies have been at the forefront of the plunder, yet rather than rein in these companies, successive UK governments are actively championing them through trade, investment and tax policies. It is time British companies and the UK government were held to account.”

The UK government has used its power and influence to ensure that British mining companies have access to Africa’s raw materials. The report exposes the long-term involvement of the British government (Labour and Conservative) to influence and control British companies’ access to raw materials. Access has been secured through a revolving door between the political establishment and British mining companies, with at least five British government officials taking up seats on the boards of mining companies operating in Africa.

Augmented by WTO rules, Britain’s leverage over Africa’s political and economic systems has resulted in a company like Glencore being able to show revenues 10 times that of the gross domestic product (GDP) of Zambia.

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