Tuesday, December 27, 2011

Class

The African Development Bank defines the African middle class as people who spend the equivalent of $2-$20 (£1.30-£13) a day. It acknowledged that many living on $2-$4 a day are "floating" and could easily slip back into poverty. Taking these people out of the equation, it put the "stable" middle class at 123 million, 13% of the population.

Yet economic growth does not necessarily mean shared growth: in some cases it means widening inequality, most vividly in South Africa.

There are now more than 100,000 Africans with at least $1m to invest. With an estimated fortune of $10.1bn (£6.5bn), the Nigerian cement tycoon Aliko Dangote is Africa's richest man and one of the continent's 16 billionaires. The South African diamond magnate Nicky Oppenheimer – who also owns the country's largest private game park, the Tswalu Kalahari reserve – comes second, with a $6.5bn fortune. Patrice Motsepe, a 40-year-old mining magnate, is South Africa's first and only black billionaire, with $2.5bn. Together, the combined wealth of Africa's 40 richest is $64.9bn – roughly twice the GDP of Kenya ($32bn) or Ghana ($31bn) in 2010.

http://www.guardian.co.uk/world/2011/dec/25/africas-middle-class-hope-continent

Friday, December 23, 2011

Nigerian poverty

Governor of Central Bank of Nigeria, Sanusi Lamido Sanusi has said 90 per cent of Nigeria live on less than $2 per day. 70 per cent are living on less than one dollar a day. Despite being a major oil producing nation, poverty, lack and deprivation reign supreme.

"...how come we have so many women dying in child birth, how come we have so many children that are out of school, how come life expectancy is down to 55 or 54. What has happened to us? We need to ask what have we done ?” Sanusi said.

Thursday, December 15, 2011

charity for who?

Kenya has a history of land-grabbing by senior government officials. Land disputes are common as legal documents of ownership are often missing or have been forged.

Around 2,000 pastoralist Samburu families have stayed squatting on edge of territory after the land they lived on for two decades was sold to two US-based wildlife charities. The two conservation groups gifted the 17,100 acres to Kenya's government in November to create a national park to be run by the Kenya Wildlife Service. NGO Survival International said the Samburu were evicted following the purchase of the land by two American-based charities, the Nature Conservancy and the African Wildlife Foundation.

There has been an ongoing, constant level of fear, intimidation and violence towards the community

"The displaced community has nothing but their livestock, thousands of which were impounded – with no reason given – on 25 November 2011. This is an urgent and serious violation of the rights of this community, which has been left squatting beside its land with no amenities" Survival said.

http://www.guardian.co.uk/world/2011/dec/14/kenya-samburu-people-evicted-land

Tuesday, December 13, 2011

South Sudan's land grab

South Sudan became the world’s newest country on 9 July when it seceded from the north after decades of war. The US-based Oakland Institute (OI) says land deals done in newly-independent South Sudan “threaten to undermine the land rights of rural communities, increase food insecurity, entrench poverty, and skew development patterns”

Deals done prior to South Sudan’s independence this year for almost 9 percent of the new nation’s land will do little to help the nation build itself up from one of the least developed countries in the world.

“In order to meet its developmental challenges, the government of South Sudan has begun promoting large-scale private investments as a short cut to rapid economic development. However, recent data about the rate at which the government is leasing land to foreign and domestic companies” shows questionable benefit, the report says.

Over five million hectares of land had already been signed away for investment for biofuels, ecotourism, agriculture and forestry in the four years leading up to a January 2011 referendum on independence. Evidence from documented deals “suggests that these projects are far more likely to undermine food security by dispossessing people from land and natural resources that are indispensable to their daily livelihoods”, it says, as deals have been struck with individuals with little or no community benefit or consultation.

Jeremiah Swaka, undersecretary at the Ministry of Justice says land deals are another case of “hit and run” by foreigners wanting to exploit the country’s wealth and cannot be called “investment”.

USAID Economist David Gosney said the two classes of investors currently coming to South Sudan were those looking for quick returns or buying speculatively in a murky market.

US-based company Nile Trading and Development's 2008 deal to lease up to a million hectares of land to produce biofuels has been described as “South Sudan’s largest land grab”.

“Evidence suggests that the companies are using the agro-forestry venture as a means of advancing their oil, gas, and mining interests in South Sudan”, OI’s December report said of NTD’s 49-year lease signed with an allegedly fictitious cooperative in a densely populated area.

“If food is going to be produced for export, then there is no way it is going to help the local community…. On the other hand, if fertile land is taken away by foreign companies, it will impact food security negatively,” said Norwegian People’s Aid’s project manager for land and resources, Jamus Joseph.

http://www.irinnews.org/report.aspx?reportid=94453

Thursday, December 08, 2011

land grab - who benefits

AgriSol negotiated tax breaks with the government of Tanzania for income earned on a 325,000 hectare plot, for which the agro-giant will likely net an annual profit of 275 million dollars. This sum surpasses the Tanzanian ministry of agriculture's total yearly budget.

A report by the East African NGO Uwazi estimates that "2009/10 tax exemptions in Tanzania amounted to 425 million dollars. That money could have financed 40 percent more resources for education or 72 percent more resources for health between 2009-2010."

http://www.ipsnews.net/news.asp?idnews=106133

The U.S. leases its land for 16,000 dollars per hectare for just one year, Ethiopia leased 10,000 hectares of land to the Saudi Star for free over a 60- year period, while Mali leased 100,000 hectares for free over a similar time period.

Saturday, December 03, 2011

The "new oil"

With food expected to become the “new oil” of the 21st century, the Standard Bank Group says Africa’s agricultural output is set for explosive growth in the coming decade.

According to a research analyst at the South African-based bank, Simon Freemantle, “There could be a doubling in African agricultural output within the next decade.”

“In China, home to 20% of the world’s population and less than 8% of its arable land, total cropland is expected to decline from 135-million hectares today, to 129-million ha in 2020. Almost half of China’s cities face water shortages. Other areas in the emerging world are even more pressed. In 2011, Bahrain, Qatar and Saudi Arabia were ranked as three of the four most water stressed nations in the world. Already, Gulf States import around 60% of their food, and natural water reserves are able to support only 30 more years of agricultural production.”

“Given these threats, attention is increasingly turning to Africa. It is estimated that over 60% of the world’s available and unexploited cropland is in Sub-Saharan Africa. Of Sudan’s 105-million ha of cultivable land, only 16% (or 16.6-million ha) had been cultivated by 2009. A similar ratio is evident in the DRC, where less than 10% of the country’s 80-million ha of cultivable land has been cultivated. The Congo River Basin alone holds 23% of Africa’s irrigation potential, with the Nile River Basin holding a further 19%,” he said.

Tuesday, November 29, 2011

The US flexes its military muscle.

Having recently committed a 100 combat troops to Uganda to help the Ugandan army track the Lord’s Resistance Army rebel group in Congo the US are now rumoured to be sending soldiers to Nigeria to help fight the Boko Haram terrorist group.Link.

Friday, November 04, 2011

"You'll Be Fired If You Refuse"

Chinese-run copper mines in Zambia are dangerously unsafe and owners routinely flout the rights of workers, says a report by Human Rights Watch. Chinese mines were worse than at other foreign-owned mines. Pay at the Chinese-run mines was higher than Zambia's minimum wage, but much lower than that paid by other multinational copper mining firms. Also miners are threatened with dismissal if they became involved in union activities.

"Sometimes when you find yourself in a dangerous position, they tell you to go ahead with the work," one miner told HRW. "They just consider production, not safety. If someone dies, he can be replaced tomorrow. And if you report the problem, you'll lose your job."

Miners had to work 12-hour shifts often in fume-filled tunnels. Sometimes shifts were 18 hours long. Zambian law limits shifts to eight hours. Miners in Chinese-run companies have been subject to abusive health, safety and labour conditions and longtime Zambian government indifference.

Many of the poor safety practices in Zambia's Chinese-run mines were strikingly similar to abuses at mines in China. Currently dozens of miners have been trapped in a coal mine in China. Four miners were killed and 50 more are missing after the accident, which happened late on Thursday in the city of Sanmenxia in Henan province.

Hundreds of Chinese miners die every year in pit accidents. The industry is one of the most dangerous in the world, and is notorious for its lax safety standards. Earlier this week a gas explosion at a mine in neighbouring Hunan province killed 29 people.

Tuesday, November 01, 2011

Land Guidelnes Delay

The adoption of international guidelines to regulate so-called land grabs has been pushed to next year after negotiators failed to agree on conditions for large-scale land investments and enforcement. Once in place, the United Nations’s Committee on World Food Security guidelines are meant to protect people, mainly in poor countries such as Sierra Leone, from “land grabbing”. Olivier De Schutter, the U. N. special rapporteur on the right to food, said in an email following the meetings that details of conditions for large-scale investments remained an unresolved sticking point.

”In general, the development of plantations increases inequality, instead of decreasing it,” said De Schutter. ”The majority will not benefit.” The guidelines on the security of tenure of land, fisheries and forests “could be a significant advance,” said De Schutter. “It can make it more difficult for governments to ignore the demands of the local community.”

http://www.newstimeafrica.com/archives/23067

Socialist Banner views the success of regulation as unlikely.

Tuesday, October 25, 2011

Nations or Peoples?

The border land between Kenya and Ethiopia is a vast, open plain. There are no fences or other visible boundaries. This land can provide a good living for livestock if it is carefully managed, and the herds are kept on the move across the seasons so they make the optimum use of each area of pasture and each water source. Over the years, the herders have built up a great body of expertise about how best to manage the area's resources.

And the land is also definitely not "empty" in the sense that it belongs to no one - the people of the area are quite clear about whose land is whose, in terms not of individuals, but of different communities.

Sara Pavanello, who has just completed a three-year study of how natural resources are managed in the area, says: "The pastoralists I spoke to very often used collective terms, saying for example, 'Our resources, we decide, we manage…' For pastoral communities, the rangeland as a whole is perceived as one single economic resource that’s communally owned, even if this tract of rangeland has been divided by the international border. At the same time different ethnic groups own, or exercise control over specific territory and the natural resources found within it." This does not mean that they exclude everyone else. They understand that other groups need access to the pasture and water sources at certain seasons. That kind of temporary access is traditionally negotiated between the elders of the different communities. Elders told Pavanello: "Today they need us; tomorrow we will need them."
She describes this kind of sharing as being seen as an "insurance policy for the future".

It is a model that makes perfect sense to the Borana, Gabra and Garri, the three ethnic groups which live along and across the border, but one that the conventional authorities struggle with, both in Ethiopia and Kenya. Land in Kenya is, for the most part, in private ownership. In Ethiopia all land belongs to the state and the moment the state chooses to claim any grazing land, and declare it no longer "free", the pastoralists lose any right to graze. Neither system is designed to cope with land communally owned.

Government authorities tend to want to introduce resource management schemes to make the rangelands more productive, failing to see and understand the subtle and flexible management systems already in place involving elders and community institutions. In their research Pavanello and Levine found cases where local administrators were enforcing ideas of ownership, citizenship and nationality which cut across the communities’ traditional right to manage their lands.

Jeremy Swift, a pastoralist development specialist with a lifetime of experience in the field, said bringing formal and customary regulation together was likely to be difficult. "Formal rules have to be uniform throughout the country; customary rules are place and time specific. This is only likely to work if there is a real delegation of authority, which governments are not usually happy about and not likely to do willingly."

John Morton of the University of Greenwich cautioned against any attempt to bypass formal government structures. "Clearly this border is very fluid, but the states are still real, and you have to respect state authority and boundaries. You don’t do people any favours by over-stressing cross-border action which may label pastoralists as having divided loyalties."

Monday, October 24, 2011

The new imperialists

Socialist Banner has previously described the new imperailsts such as Canada. But others should not be over-looked, Australia being one new arrival in African continent to take advantage of its natural wealth.

30 per cent of global mining resources are in Africa.

At least 230 Australian companies are active in the resource sector on the African continent. Between them, they are pursuing 650 individual projects in 42 countries. Their total investment is estimated at a whopping $24 billion. About 20 companies and 100 projects have been added just since the beginning of 2011. And Intierra Resource Intelligence estimates that the capital expenditure for new projects in the pipeline is about $23bn.

http://www.theaustralian.com.au/national-affairs/opinion/africa-provides-a-rich-seam-for-resources-sector/story-e6frgd0x-1226174509918


At this week's Commonwealth Business Forum with 300 officials from 40 African countries attending , Foreign Minister Kevin Rudd is set to unveil a $30 million initiative to promote mining development in Africa

Tuesday, October 18, 2011

Nigeria - so wealthy, so poor

The world’s 20th poorest country apparently because most Nigerians (92 per cent) live below the poverty line as they subsist on less than two dollars (N320) a day. According to the Nigerian Bureau of Statistics (NBS), no fewer than 33 million Nigerians are unemployed, many of them university graduates, while the 2010 Global Monitoring Report of the United Nations Education, Scientific and Cultural Organisation (UNESCO) puts the number of out of school children at over eight million. Infant mortality rate is 85.8 of 1000 live births, under-five mortality rate is 137.9 of live births, malnutrition prevalence is 41 per cent, insecurity rate is alarming, while life expectancy at birth is 48.1 years.

In 1960, according to the Nigerian Bureau of Statistics, about 15 per cent of the population was poor. This rose to 28 per cent in 1980. By 1985, it had risen to 46 per cent, dropping to 43 per cent in 1992. However, by 1996 the poverty incidence had gone up to 66 per cent before climbing further to the current rate of 92 per cent. This rise in poverty rate in the country has been inversely proportional to the petro-dollar wealth of the country; it seems Nigeria makes more money to get Nigerians poorer; the richer the country, the poorer the citizens.

Wednesday, October 12, 2011

land grab

What is ‘land grab’. Think of what you can buy with 40 cents if you walk into a grocery store in the U.S., or Europe? Will you be able to buy a piece of candy with 40 cents? Probably not! But if you go to Africa, you can buy an acre of land for money as small as 40 cents for a 99 years lease.

According to Oxfam ‘Land grab’ refers to land acquisitions done in one or more of the following ways:

Violate human rights/women’s rights;
Flout the principle of free, prior, and informed consent of the affected land users, particularly indigenous peoples;
Ignore the impacts on social, economic, and gender relations, and on the environment;
Avoid transparent contracts with clear and binding commitments on employment and benefit sharing;
Shun democratic planning, independent oversight, and meaningful participation.

The corporations grabbing land and governments of Africa refer to land grab in a more humanized terminology; they inaccurately call it “land investment deals.” They claim the goal of such deals is to increase food production and to make involved poor nations food secure. The victims characterize land-grab as ‘neo-colonialism’, ‘modern day slavery’, ‘ethnic-cleansing’, ‘the second scramble for Africa’

In southern Ethiopian regional states, over four million are in need of emergency food aid, while rice and corn produced on lands they were evicted from is shipped overseas to feed India or Saudi Arabia.

Sunday, October 09, 2011

Happy Birthday, Desmond

As Archbishop Desmond Tutu danced with the Soweto Gospel Choir at his 80th birthday party and was feted by the likes of Bono, half an hour's drive away, another churchman had just completed a month-long hunger strike. Xola Skosana is pastor of the Way of Life church in Khayelitsha, Cape Town's biggest township. He went without food throughout September to protest at the treatment of the poor. "It's interesting to me that a woman would make up a bed in a five-star hotel then come home to sleep on the floor," Skosana said from his rudimentary office. "Or cook the best meal for someone else and come back and live off a slice of bread."

Skosana said: "Black people feel this is the old South Africa. If you come to Cape Town, you've come to the last post of the colonial history of this country. Both politically and economically, white people are in power. In other parts of South Africa, black people don't have to wake up and say, 'Yes boss', and feel psychologically oppressed. In Cape Town, they still have to deal with that attitude."

Nobom Nobele, 29, washing clothes by hand, said her shack has no electricity or running water, forcing the family to use candles and a paraffin stove, and walk 10 minutes to a friend's home every time they need to use a toilet. Her children, aged 12 and four, suffer rashes from unclean water. "The government makes promises at the time they want your vote, but after that they forget," she said. "There's been no change since 1994. We're still hungry, we're still living in a dirty place."

From here

Saturday, October 08, 2011

The Clearances

New Forests Company, grows forests in African countries with the purpose of selling credits from the carbon-dioxide its trees soak up to polluters abroad. Its investors include the World Bank, through its private investment arm, and the Hongkong and Shanghai Banking Corporation, supposedly all in a good cause: to protect the environment and help fight global warming. The Ugandan government granted New Forests a 50-year license to grow pine and eucalyptus forests. The company expects that it could earn up to $1.8 million a year.

But there was just one problem: people were living on the land where the company wanted to plant trees. The company and government said the residents were living illegally in a forest. Residents were given until Feb. 28, 2010, to vacate company premises while soldiers and the police kept surveillance. Company officials visited, too. From time to time a house would be burnt down. Olivia Mukamperezida said her house was among the first in her community to be burned down.

According to the company’ those living in the area left in a “peaceful” and “voluntary” manner.

People saw it quite differently.

“I heard people being beaten, so I ran outside,” said Emmanuel Cyicyima, 33. “The houses were being burnt down.”

Other villagers described gun-toting soldiers and an 8-year-old child burning to death when his home was set ablaze by security officers.

“They said if we hesitated they would shoot us,” said William Bakeshisha, adding that he hid in his coffee plantation, watching his house burn down. “Smoke and fire.”

20,000 people were evicted from their homes.

“Too many investments have resulted in dispossession, deception, violation of human rights and destruction of livelihoods,” Oxfam said in the report. “This interest in land is not something that will pass... whatever land there is will surely be prized.

Across Africa, some of the world’s poorest people have been thrown off land to make way for foreign investors, often uprooting local farmers so that food can be grown on a commercial scale and shipped to richer countries overseas.

From here

Chinese capitalism

Chinese investment in Zambia, Africa's leading copper producer topped $1 billion last year and came with the promise of 15,000 jobs as well as an additional $5 billion investment over the next few years. Almost all of the money went into Zambia's copper-mining industry, with only 10% invested in construction, agriculture, retail and manufacturing. In a country where almost two-thirds of the 13 million citizens live under the poverty line of $1.25 a day, economic growth is the government's priority but Zambians have begun to realize that "economic growth has not translated into significant poverty reduction," as the latest World Bank country assessment states.

Copper — responsible for 70% of Zambia's export earnings — largely contributed to the country's 7.6% economic growth in 2010. Critics complain that those revenues hardly benefit all Zambians. Unions and watchdogs note that most profits are taken out of the country instead of being reinvested in much needed infrastructure, hospitals and schools. There are also widespread allegations of Chinese firms ignoring environmental and labor laws to reap higher profits — and of the government turning a blind eye.
"The government lets Chinese investors act above the law," explains Edward Lange, coordinator of Southern Africa Resource Watch in Zambia. "Corruption is rife. We have lost control over our resources."
Tens of thousands of mine workers and their families are growing increasingly disgruntled with Chinese-run mining operations. Previous protests against low pay and poor working conditions have shown few results, only worsening tensions among workers and managers. During a strike in April, Chinese managers shot and wounded eleven protesters.
"We are discontent with the political and economic situation," confirms Charles Muchimba, research director of the Mineworkers' Union of Zambia. While Chinese investors have reaped massive profits, workers have borne the brunt of Zambia's free-market economy and suffered salary cuts of up to 40% during the recession, he says.

China is on a resource grab. Beijing doesn't do gifts; it does deals. The ambition, speed and scale of Chinese involvement in Africa is extraordinary. According to Chris Alden, author of China in Africa, two-way trade stood at $10 billion in 2000. By 2006, it was $55 billion, and in 2009 it hit $90 billion, making China Africa's single largest trading partner, supplanting the U.S., which did $86 billion in trade with Africa in 2009. Today the Chinese are pumping oil from Sudan to Angola, logging from Liberia to Gabon, mining from Zambia to Ghana and farming from Kenya to Zimbabwe. Chinese contractors are building roads from Equatorial Guinea to Ethiopia, dams from the Congo to the Nile, and hospitals and schools, sports stadiums and presidential palaces across the continent. They are buying too. Acquisitions range from a $5.5 billion stake in South Africa's Standard Bank to a $14 million investment in a mobile-phone company in Somalia. What's happening is a new scramble for Africa.

Wednesday, October 05, 2011

there is enough

Meredith Alexander argues that global hunger is not a result of food shortages, but poverty and inequality. Food itself is almost never the problem. Instead, people are hungry because they lack money and power. Even now in the Horn of Africa where 10 million people are at risk of starvation, food is available in the markets. It is just too expensive for poor people to buy. Production is vital, but the question of how food is distributed is more important. Increasing the size of the pie means nothing to people who aren’t allowed near the table. There are proven policies that could ensure every man, woman and child on the planet gets enough to eat. Ultimately, hunger has little to do with food and everything to do with justice.

Full article here

But yet again the proposed policies and reforms suggested does not address the root problem - capitalism's drive for profits and their accumulation.

Tuesday, October 04, 2011

its not drought and its not over-population

Macalester College geography professor William Moseley has conducted research into food insecurity and violence in the famine-stricken Horn of Africa and spoke to Minnesota Public Radio.

Moseley: I think you have to be very careful not to just assume that famine is a natural consequence of some meteorological event. I think a great comparison is in the U.S. In Texas and Oklahoma right now we're experiencing a terrible drought but we don't have a famine there because there are government programs in place to prevent that from happening.

Moseley: I think there's a lot of misunderstanding in the U.S., we've already discussed one, that this is a result of drought. I think a lot of Americans attribute this problem to overpopulation. I've argued elsewhere that many parts of Africa are not densely populated, including this area. There's about 13 Somalis per square kilometer, which is much lower density that what we're seeing in our own drought-stricken state of Oklahoma. Yet we tend to focus on the population issue, and I don't think that's what's really driving this issue

Moseley: Once we get beyond this crisis in the short term, we have to think longer term: How do we prevent this from happening again? The U.S. Agency for International Development has been very focused on increasing food productivity and through a new "green revolution" approach, so using improved seeds, insecticides, chemical fertilizers to increase food production. That may make sense in some areas of the world but I'm very skeptical of that working in the Horn of Africa. And that's largely because the poorest of the poor, the people who are hungry, don't have the resources to sustain that strategy. I think added on top of that, that type of approach is highly linked to energy prices, which are forecasted to keep increasing. What I favor is a much more locally focused approach, one that works on enhancing traditional techniques to increase food production.

Moseley: People have farmed grains in this area for centuries. One could try to enhance productivity through increasing use of manure to better fertilize their fields. Or to be mixing creatively different crops together that complement one another, so mixing legumes with grains, for instance — the legumes fix nitrogen and increase grain productivity. But one that is not so dependent on fossil fuel inputs from outside of the area.

Moseley: Since 2007-2008, when global food prices spiked, prices went up about 50 percent and for some commodities, like rice, they went up 100 percent. So in that period there were a lot of food riots around the world, especially in developing areas of the world. There's very much a concern on the part of the U.N. about social unrest, which is connected to food scarcity, high food prices. I'm skeptical of the way that's been framed. I'm skeptical of calling this social unrest "food riots." I think it gives an image of this violence spontaneously erupting, a bit like dog fighting over scraps of meat. I prefer to call them food demonstrations, because what the public is really upset about is government policies that have often resulted in these high food prices. I think there are people that want to bring the attention of their government to the fact that there are a lot of vulnerable urban people who are having trouble accessing food.

Moseley: ...I'm going to present a study that we published in 2010 in the proceedings of the National Academy of Sciences on this social unrest that occurred in West Africa. What we showed is that you had policies through the '80s and '90s which were pushed on these countries by the World Bank for free market reform. What that meant is that they ceased to provide subsidies to their own farmers and they removed import duties on food that was imported. What you see during this period is a decrease in food production and an increased reliance on food imports. That was fine as long as global food prices were cheap, but global food prices have been rising since 2007. They spiked in 2007-2008 and they're spiking again in 2011. So you're exposing your population to volatile global food prices and that was a result of a series of policy decisions.

Full interview here

The Oil Curse in Uganda

In 50s, some economists suggested that natural resource-abundance would help the backward States to overcome their capital shortfalls and provide revenues for their governments to provide public goods and lift citizens out of the doldrums of poverty. However, since then, a growing number of researches have established a link between resource-abundance and a number of social and economic problems. Natural resource-abundance has been associated with slow growth, greater inequality and poverty for a larger majority of a country’s population, corruption of political institutions, and more fundamentally, an increased risk of civil conflict. At the same time, there is an established link between resource motivated conflict and economic collapse. Of all natural resources, oil has been found to have the highest risk. 23% of states dependent on oil exports have experienced civil war in any 5-year period, a figure that dwarfs the 0.55% for countries without natural resources.

Recently oil has been discovered in Uganda. Oil experts estimate Uganda’s Albertine Basin has at least two billion and as many as six billion barrels of recoverable oil, positioning Uganda to become one of sub-Saharan Africa’s top oil producers and potentially doubling current government revenues within 10 years. The resource could become Uganda’s curse rather than a blessing. In Uganda the agriculture and fishing sectors provide approximately 80% of employment. Uganda is Africa's second-leading producer of coffee, which accounted for about 23% of the country's exports in 2007-2008 and 17.9% in 2009. Exports of nontraditional products, including apparel, hides, skins, vanilla, vegetables, fruits, cut flowers, and fish, are growing, while traditional exports such as cotton, tea, and tobacco continue to be mainstays. Most industry is related to agriculture.

Most of Uganda’s known oil reserves are located along Lake Albert and the D.R.C. border, in one of Africa’s most ecologically sensitive areas. Wildlife based tourism and scenery dominates Uganda’s hospitality industry with more than 70% of the visitors coming to the Albertine rift. Incidents of land grabbing and migration towards oil sites are already taking place. Many multinational companies backed by their foreign “interest”, are already scrambling for oil exploration in Uganda. Lukoil, for example is Russia’s largest oil company, and the second largest private oil company worldwide by proven hydrocarbon reserves, with about 1.1 per cent global oil reserves, and 2.3 per cent of global oil production. Interesting question to ask; what are the implication of this to “little” Uganda? The same oil will be sold back to Uganda at a higher cost and additionally employment opportunity will be limited since most of its exploration and production activity is located in Russia. The higher costs of fuel are then reflected in the hiking costs in transport sector which in turn is shifted to the public in terms of high commodity prices, and the costs of environmental management (Pollution) should be noted.

it’s important to acknowledge that the existing conflicts are real and that small conflicts may escalate. This is true with the current conflicts in Uganda. The conflicts include: scrambling over land, multinational companies scrambling over oil exploration licenses, and associated consequences like corruption, contracting a monopoly or medium firm which may use sub-standard materials, political tensions which may explode into violence and creating ethnic and cultural differences, propaganda, migration of wildlife, and environmental threats such as clearing forests, digging of trench during survey.

From here

Monday, September 26, 2011

to aid or not to aid

An interesting interview on Der Spiegel with Zambian economist Dambisa Moyo, author of "Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa," and "How the West Was Lost: Fifty Years of Economic Folly -- and the Stark Choices Ahead."

Dambisa Moyo: ... Africa is the only continent on which there continues to be famines again and again. Between 400 and 500 million people don't have enough to eat even though the continent has more fertile arable land than any other. Something's wrong about that.

SPIEGEL: Catastrophes like the one in Somalia are one thing. But don't you think Africa needs long-term aid programs to get its problems under control?

Moyo: I'm opposed to continuing to automatically pump billions into Africa each year in the form of cheap loans and budgetary assistance. This money has bred dependence and inflation; it doesn't allow people to ever really become productive. The West has been reliably supplying aid for 40 years. But, even so, Africa continues to have poor infrastructure, bad education and a lousy health-care system. Poverty has actually increased since development aid started being supplied. In 1970, 10 percent of Africans lived in poverty. Since then, that figure has grown to roughly 50 percent.

SPIEGEL: Why haven't African governments been able to put to good use the roughly $2 trillion (€1.45 trillion) that has flowed into their coffers over the last 50 years?

Moyo: Because this aid has hardly ever been tied to conditions. Donor countries allow African leaders to put this money in Switzerland, only to go shopping with it later on the Champs-Élysée.

SPIEGEL: Why doesn't anybody rebel against the corrupt rulers in Africa?

Moyo: Why should we normal Africans call our elites to account when people keep coming from the West and saying: "Don't worry. We'll keep paying no matter what you do with the money." An African president once said to me: "You can do what you want. You can swindle. You can kill your own countrymen. As long as there is hunger and disease where you are, the West will take care of you." That's why African governments steal and swindle.

Socialist Banner however finds it disappointing that Moyo can only call for more capitalist investment, particularly from China, as a solution. Africans, as she argues, indeed "need to finally take responsibility for themselves."