southwatch

Foreign Aid harming Africa?

The multi-billion aid industry has largely failed in Africa. The foreign NGO movement has grown as Africa`s crisis has deepened. Africa can prosper without vast amounts of new aid.

In the latest issue of The Africa Report, Michael Holmen (former Africa editor of the Financial Times) challenges the demands and PR-message for more aid to Africa that international NGO`s have become expert at campaigning for.

"Aid isn`t working, but the aid lobby pretends it is," he writes. He points out that there are more foreigners working in Africa now than there were at independence five decades ago.

"As foreigners arrive to take up short-term contracts, each year about 70000 skilled Africans - doctors, engineers, nurses - leave to work abroad. Western governments should ask whether the growth of NGOs is not only a symptom of Africa`s crisis, but perhaps part of the cause?" he suggests.

It is a relevant question and one that NGOs in Europe do not seem to keen on discussing.

By Jan Speed

Focus thanks to kidnapping

Researchers and activist from the Niger Delta region of Nigeria have misgivings about the groups kidnapping expatriate oil workers, but they applaud that at last the poverty and degradation of the region has recieved international attention.

“Every body is now talking of the Niger Delta because Americans and Britons are being kidnapped. If the protests were peaceful there would be no discussion, says Ogu Enemaku of the Nordic Africa Institute. This week took part in a seminar in Oslo on Norwegian participation in Nigeria’s oil industry.

Enemaku points out that when oil was discovered there was celebration in the Niger Delta.
“They brought out their drums and danced. Their source of celebration has brought misery. Technology is still not in the hands of Nigerians. In local communities there are two main occupations: Farmers and fishermen. Oil companies to not give damn about the environmental damage. Over years there have been many  quiet protests, often asking for a clinic or clean water. Anger has been boiling up slowly, he says.

Stella Amadi, a lawyer working for the Center for Democracy and Development in Nigeria says, only partially in jest: “If kidnapping is what is necessary to get attention we need, lets kidnap some more. We have been writing letters, taking part in seminars but nobody has been listening.”
She points out that the recent rounds of kidnapping of expatriates is only a symptom of the problem.
“Lets face it, the kidnappers  have nothing to loose . The crux of the matter is that there is no development in the Niger Delta. Something is very wrong. The stark reality of poverty is so pungent, so sad, she says.

by Jan Speed

Angolan billions for Statoil

The investments of the Norwegian oil company Statoil in Angola are beginning to pay off handsomely. At the same time the company is coming under increased scrutiny by international NGOs.

According to Statoil:
* Their oil production in Angola in 2005 was 70000 barrels per day, with new fields being opened up this year.
* Statoil payed 1,54 billion Norwegian kroner (NOK) in tax to the Angolan government last year, of an income of NOK 8,8 billion.

Last year Statoil was criticized for not publishing the value of the profit oil that goes to the host country. In the annual report published recently the company revealed that the “value of the petroleum kept by the host country is calculated to be NOK 2,7 billion for 2005 for the three countries Algeria, Azerbeijan and Angola.

Shortly a Norwegian co-ordinator of the international transparency organisation Publish What You Pay will be employed. This will increase the pressure on local firms to come clean on their involvement in oil projects.

Next week The Centre for Democracy and Development (Nigeria), together with Future in our hands and the Norwegian Council for Africa will present the findings and recommendations of their new report on Statoil in Nigeria.

by Jan Speed

Shell – pay don’t play

Oil giant Shell is playing for time to avoid having to pay $1,5 billion to the Ijaw people of Nigeria’s Delta region for having ruined their natural environment.

The company is appealing a ruling by a federal court that Shell has to pay compensation as ordered by Nigeria’s parliament almost six years ago.

According to the BBC Ijaw activists have been fighting since 2000 for compensation for environmental degradation in the oil-rich region. Local militia groups have also been behind recent attacks on oil installations and the kidnapping of oil workers. Community leaders have indirectly threatened Shell with further production stops if they insist on appealing the recent court ruling

Shell thinks that the claim has no legal foundation. The company does not take responsibility for the fact that the Delta is an environmental disaster zone – due to the oil industry. The company should have started cleaning up its act in Nigeria many years ago. People who throw litter on the streets of many cities have to pay a fine. Companies such as Shell which belatedly have become environmentalists must pay for past sins.

by Jan Speed

Quality from Africa

When Norwegian consumers have a choice between a roast from Namibia or one marked “Godt norsk” (Norwegian quality), they choose the latter.

Activist from a political youth organization and the Norwegian Council for Africa (NCA) want to change the negative image everything African has in Norwegian minds. They want to market African produce in Norwegian shops with a label, “Quality from Africa”.
- An increase in imports from Africa is a political goal. African produce needs a higher profile, they say.
According to Magnus Bjørnsen from NCA the negative picture of Africa as a continent ravaged by war, hunger and sickness is the biggest hurdle preventing African farmers from getting their produce sold in Norway.
- A quality label is not a philanthropic project. It is meant to promote trade between equal partners, says Bjørnsen to the Vårt Land newspaper.

by Jan Speed

- Norway must push transparency

International NGOs working to make oil a benefit rather than a curse for ordinary people in oil-rich countries, expect Norway to play a leading role.

- Norway must push harder internationally to further the cause of transparency of oil revenues. The government has not pushed the issue to its full potential, says  Gavin Hayman, Campaign Manager in Global Witness.

Download video "Promoting oil for development"

He would like to see Norway hosting the Extractive Industries Transparency Initiative (EITI), which Tony Blair-initiated in 2002.

Leiv Lunde, special advisor at The Norwegian Agency for Development Cooperation (Norad), is not foreign to the idea. He coordinates the use of $10 million set aside annually in an “Oil for development” program. The program will have a special focus on East Timor, Angola, Nigeria, Sao Tome and Sudan.

Sub-Saharan Africa is in the midst of an oil boom, with oil production set to double by 2010. By the end of this decade, foreign energy companies will pour more than $50 billion into the Gulf of Guinea region—from Nigeria down to Angola—for the exploration and production of petroleum. Oil-producing African governments, in turn, will receive at least $200 billion in oil revenues in the next decade.

It is not certain that the citizens in the region will also benefit from this boom. According to Global Watch that depends, in part, upon the level of transparency surrounding oil revenues, and the degree to which governments in the region are accountable for the allocation and spending of those revenues.

- Our challenge is doing the opposite to what other donors are preaching. Aid now often dependent on countries furthering democracy and anti-corruption. But we are looking for the bad performers, the ones affected by the oil curse, those who are at the bottom of the list regarding transparency, says Lunde.
It is these countries he says who need to learn from the Norwegian experience in managing oil revenues. At the same time he says it is a priority of the government to try engage countries such as China and India into a dialogue about transparency.

Both the major Norwegian oil companies, Statoil and Norsk Hydro, will this year publish what they pay in tax to the various countries in which they operate.

- This is no big deal. This information has previously been available in the annual reports of our different companies. It is not a problem for us, says Arvid Halvorsen in Norsk Hydro.

by Jan Speed

Children afraid of the dark

Every evening children in Northern Uganda trudge along footpaths and roads into the bigger town to seek safety for the night. Photographer Sven Torfinn has documented the situation in the region for the U.N. news agency IRIN.

His pictures can be seen on their site’s photo gallery.
Protected by darkness the killers and kidnappers of the Lords’ Resistance Army (LRA) attack.
The rebels’ new strategy of ambushing vehicles, including those of humanitarian aid agencies, has worsened the humanitarian situation in northern Uganda, writes International Crisis Group in a report.
They say that the U.S., UK, Norway and the Netherlands (the informal ‘Quartet’ of concerned countries in Kampala), the UN, Sudan and the Congo must work with the Ugandan government to fashion a comprehensive strategy that integrates both military and non-military elements as a way of solving the twenty year old crisis in northern Uganda.

Text: Jan Speed
Foto: © Sven Torfinn/IRIN

Arms from blacklisted companies

It is difficult to be ethical, left-leaning and in power. The Norwegian Ministry of Defence buys weapon components from companies that the Minister of Finance deems unethical.

This week the Norwegian Ministry of Finance excluded seven companies from the Government Pension Fund - Global (previously the Petroleum Fund) because they are involved in production of nuclear weapons. Last fall the Fund sold it’s investments in six companies involved in the production of cluster bombs, among them Canadian L3 Communications and Lockheed Martin Corp.

In November the Norwegian Air Force signed a contract with L3 SPAR Aeropspace, and the partially government owned Kongsberg Defence and Aerospace has a development contract with Lockheed. The Norwegian Defence Force also buys laser equipment from Northrup Grummen, which as blacklisted this week, according to the newspapers Vårt Land and Aftenposten.

- The Government has decided to extend the list of companies who are excluded from the Pension Fund. This does not affect the states’ acquisition policy regarding weapon systems. There is a principle difference between owning a share in a company and buying weapons from it, says Deputy Defence Minister, Espen Barth Eide to Vårt Land.

Many NGOs and supporters of the new red-green-alliance government cannot quite see the difference.

The Ministry of Finance says in a statement that the exclusion from the fund is based on a recommendation from the Ethics Council for the fund:
The Advisory Council on Ethics for the Government Petroleum Fund recommends that the companies BAE Systems Plc., Boeing Co., Finmeccanica Sp.A., Honeywell International Inc., Northrop Grumman Corp., United Technologies Corp. and Safran SA be excluded from the Petroleum Fund because they are presumed to be involved in production of nuclear weapons.

by Jan Speed

Chad’s oil starting to smell

Maybe it was to good to be true – an oil rich African government putting aside oil money for the poor.

Chad is scrapping the law that states that 10 percent of Chad’s oil revenues be put in a special fund for future use, with other portions earmarked for improving health, education, roads and water supply in the country - ranked 173rd of 177 in the latest UN human development index. This was not unexpected. People living along the pipeline have long complained that they have not seen any benefits from the oil revenue. Talk for corruption in the government of President Idriss Deby has been widespread. The government seems to want to pay the army better to reduce tensions.

“This seems like a short-term survival strategy but one that will have long-term harmful consequences,” Ian Gary, Oxfam America policy advisor for extractive industries, told IRIN.

Chad’s oil revenue law was part of novel poverty-reduction measures required by the World Bank in return for financing part of the US $3.7-billion pipeline, which snakes 1,100 kilometres from the south of landlocked Chad through Cameroon to a mooring buoy in the Atlantic Ocean. What was a model for new oil rich countries now seems to be in ruins - a pity for Africa in need of a transparent oil sector.
by Jan Speed

Oil companies must get active

Foreign investors are pouring money into the Angolan oil sector. The population remains desperately poor, and the MPLA-run government does little for it's own people.

In this situation oil companies must take a greater social responsibility.
«The Government of Angola lacks the will to distribute funds to social sectors and lacks institutions to deal with the resource curse. The oil companies have the capacity to influence this, particularly if they co-operate....oil companies have a large social responsibility in Angola,» write Arne Wiig (Chr. Michelsens Institute) and Madalena Ramalho (Instiuto de Pesquisa Economica e Social) in a paper on Corporate social responsibility in the Angolan oil sector.

They do not have much good to say about the Angolan governments use of the oil income. They find that although oil companies do support social projects it is mainly to «increase their profits»:
«In practice policy on corporate responsibility of oil companies is mainly driven by economic incentives (it is good for business), rather than ethical considerations.»
by Jan Speed