Season's Greetings

The blog wishes all readers, visitors and partners a wonderful and prosperous new year in 2013. The blog is hopeful of engaging in and debating cross-cutting and salient issues that affect at large global poverty and development efforts.

Keep visiting, reading, disseminating and contributing to issues through rejoinders and direct comments. Let's together make progress and development happen.

Thank you.

Ghana's Election: High Expectations

By:  Alex Vines, Research Director, Area Studies and International Law; and Head, Africa Programme, Chatham House. 

Ghana's presidential and legislative elections set for 7 and 28 December 2012 respectively, will be extremely close and come at a significant time given the region's instability.  

The opposition New Patriotic Party (NPP) has again selected Nana Akufo Addo as its presidential candidate and aim to regain power after its 2008 defeat. Akufo Addo was defeated by less than 1% of the vote in the final run-off - just 40,500 votes. The ruling National Democratic Congress (NDC) candidate, President John Mahama, is campaigning to convince voters that he and his party are fit to continue in office. 

The credibility of the process will be key. Nana Konadu Agyemang Rawlings, the wife of the controversial and outspoken former president, Jerry John Rawlings, has been barred on technical grounds from running in the presidential election. Although she never really stood a serious chance of winning significant votes, this has focused attention on the impartiality of the Electoral Committee, whose perceived independence will be essential if the result of this expected tight election is to be peaceful. We have seen in other elections in Africa in recent years how partisan electoral commissions have been triggers for protest and violence.

The management of the economy has been the main battleground on which the candidates have fought. Mahama promises to improve living standards, tackle inflation and boost infrastructure development. Corruption scandals have hurt the ruling NDC's reputation, but the NPP's record in office was also far from clean. Both parties know that by the time of the next election in 2016, a projected oil and gas production boom will favour the then incumbent.  

Hot issues at the debates

There have been two feisty presidential public debates (and a vice-presidential debate) during the electoral campaign. There was no clear winner in the first presidential debate, partly because it lasted over five hours and even for Ghanaian audiences with stamina for long discussions, the key messages were diluted. The economy and education were the main issues discussed. President Mahama reiterated pledges made in his party manifesto, such as to target real GDP growth of over 8% a year and lowering the fiscal deficit to 5% of GDP (from an estimated 6.5% in 2012).

Much shorter, lasting three hours, the second presidential debate covered a range of issues, including corruption and foreign policy. Mr Akuffo-Addo highlighted the GH¢52m (US$27.4m) Woyome scandal, which engulfed the government in early 2012, as an example of the administration's cronyism, and alluded to the lack of corruption allegations against himself. 

On foreign policy, the government's approach to the situation in Côte d'Ivoire featured prominently in the debate. Mr Akuffo-Addo claimed that Mr Mahama had damaged Ghana by allowing Ivorian dissidents to operate from bases within Ghana. Mahama replied that he enjoyed excellent relations with the Ivorian government. 

The NPP and Mr Akuffo-Addo were seen as the winners of the second debate, especially on the corruption issue. If Akuffo-Addo wins the upcoming election, it is argued that the relationship with Ivoirian President Ouatarra would improve, as bilateral relations still suffer from the perception in Abidjan that the NDC favoured President Gbagbo during the 2011 Ivoirian post-election crisis. In the context of an inward looking Nigeria, if Ghana can improve its relations with Côte d'Ivoire, and in partnership with Senegal, regional integration in the Economic Community of West African States (ECOWAS) could be quickened. 

A third party, the Convention People's Party (CPP), did well in the presidential debates and may increase its influence, especially as a victory is not likely during the first round of voting on 7 December. Its leader, Abu Sakara, could be in the position of kingmaker if the NDC and the NPP have to compete for votes from CPP supporters in the second round. He has criticised both parties and neither can currently assume his support.  

Looking to Africa's newest oil producer

The international markets are optimistic that Ghana's elections will pass smoothly. In late November, Standard & Poor's (S&P) Ratings Services maintained its B ratings for Ghana's long-term and short-term foreign- and local-currency sovereign debt, with a stable outlook. The elections are important for further consolidating Ghana's democracy and building up the credibility and institutions required to oversee Ghana's newly found oil and gas windfall. Whoever wins will need to manage expectations, seriously combat corruption and reform the tax system including working out the fairest way to tax the vital mining sector. 

In a region where the promise of 'Africa Rising' is meeting the complicated reality of on-going political, economic and security challenges, Ghana’s continued stability and growth provides an important foundation for optimism. For this reason, these elections are important not just for Ghana, but for the growing number of states and actors seeking to benefit from increasing confidence in Africa.

SEC Must Reject Oil Industry Assault on Transparency

Secrecy breeds corruption and mismanagement

Source: Revenue Watch Institute, November 5, 2012: http://www.revenuewatch.org/news/press_releases/sec-must-reject-oil-industry-assault-transparency

NEW YORK—The U.S. Securities and Exchange Commission (SEC) must reject oil companies’ demand for a delay in enforcing new disclosure rules, to carry out the law of the land and protect the public interest, the Revenue Watch Institute said today.

The American Petroleum Institute (API) and the U.S. Chamber of Commerce have asked the SEC to delay, or “stay,” new securities rules requiring oil, natural gas and mining companies to make public their payments to governments, until federal courts issue a verdict in a lawsuit recently filed by API and the Chamber. Representing major oil companies, API and its allies are demanding the courts overturn the rules as well as the underlying transparency law they carry out.

“API is making an extraordinary assault on corporate and government transparency,” said Daniel Kaufmann, president of Revenue Watch. “Based on its own clear criteria, the SEC has firm grounds for rejecting the oil industry’s stay request.”

“Suspending the rules would harm investors as well as citizens of developing countries, who stand to greatly benefit from greater transparency and accountability,” Kaufmann said. “There is no reason for the SEC to be intimidated by API into changing its well thought-out timeline, which calls for this greater company disclosure to begin in 2014.”

The rules carry out Section 1504 of the Dodd-Frank Act, passed by Congress in 2010, which requires companies listed on U.S. stock exchanges to report publicly their payments to governments, for each country and each natural resource project. In drafting the rules, the SEC solicited and considered extensive public comments for two years, including from the oil industry.

The law and SEC’s rules are also the template for transparency legislation being finalized by the European Union, and have been strongly endorsed by British Prime Minister David Cameron and other leaders.

Senators Ben Cardin (D-Md.), Richard Lugar (R-Ind.), Carl Levin (D-Mich.) and Patrick Leahy (D-Vt.), strong supporters of the disclosure law, have urged the commission to “deny the stay request, and actively resist any other attempt to delay the implementation of the rule.” They also cite the precedent that U.S. rules have set for the EU, warning that delaying their implementation will “cause harm to investors and citizens in the United States and abroad.”

Publish What You Pay, the leading civil society coalition involved in the SEC’s two-year rulemaking process, has also urged the commission to strongly defend its rules.

Timeline: Dodd-Frank Section 1504

SEC Rules to Bring Transparency to Oil and Mining Industries

Oil Companies' Lawsuit Seeks to Undermine Global Transparency

Aid to developing countries: restructuring needed!

Whose interest: donor or recipient countries?
Picture source: capitalismmagazine.com

Aid contributes to the fight against poverty and hunger in developing countries. It is also increasingly argued that aid is hurting developing countries especially those in Africa. In recent decades, Africa has witnessed more aid than any other continent. According to the 2011 ONE Data Report, total development assistance for sub-Saharan Africa reached $39.7 billion in 2010, representing an increase of $13.5 billion over 2004 levels.

It is hard to understand the paradox of aid. It is incredibly disappointing that the region that receives the most aid is today the poorest continent in the world, particularly considering the valuable natural resources at its disposal. Even with increased foreign aid, it is overwhelmingly evident that about 51 per cent of people in sub-Saharan Africa live on less than 1.25 dollars per day.

The disparity between aid and effective development has therefore generated unprecedented debate regarding whether or not Africa really needs aid to combat the ever-increasing poverty, hunger and economic backwardness. The Rome Declaration (2003), Paris Declaration (2005) and Accra Agenda for Action (2008), meant to rethink the architecture of aid, have been necessary but have barely made an impact. The declarations and commitments constitute talks without action. Of the thirteen measurable targets set by the Paris Declaration, only one had been realized as revealed by the 2011 Monitoring Survey of the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD). It is sobering and worrying indeed.

This is a stark reminder that aid is not effective. Aid makes the poor poorer and the rich richer. It is widening the gap between rural and urban settings. Development and progress is at a standstill if not dwindling.

The causes of aid ineffectiveness are not hard to guess. The world does not need a miracle to make sure that aid alleviates poverty. It is about getting priorities right, cooperation and real commitment to global development. Aid commitments are falling short apart from aid being used as a tool to threaten developing economies. The potential global recession has seen aid threatened with cuts too. Britain has made moves to cut its aid. The donors choose when and what to give out. Obiageli Ezekwesili, World Bank Vice President for Africa - at the first-ever African Investment Summit organized by the London Stock Exchange (LSE) on Tuesday October 11 in London - warned that the temptation to cut aid to Africa would be a great mistake. The warning may already have been ignored. David Cameron has threatened to cut aid intended for Ghana and Uganda this year in response to their treatment of homosexuals. Britain has already done it to Malawi. The UK government has cut aid by $30 million to Malawi after two homosexuals were sentenced to 14 months hard labor for having an engagement ceremony.

Is aid obligatory or merely a country’s wish? Britain can decide the amount and the timing of its hand-outs to needy economies. The ‘beggars can’t be choosers’ syndrome should no longer play a role here. However, developing economies should own what they receive! Uncertain aid unsettles the priorities of developing economies. Shouldn’t aid commitments be made certain to inform development agendas of less developed economies? Threats to cut down or withdraw aid only vindicate aid ineffectiveness and unfulfilled commitments. Accra Agenda for Action’s (AAA’s) ownership of programmes of aid is just a mirage. Donors still decide. Aid with strings attached dictates what to do or otherwise.

Commitments should be made to go beyond the rhetoric. Commitment not backed by actions has the tendency to put development at risk. Over 13 million people are in danger from life-threatening hunger in the horn of Africa, increased child and maternal mortality is gradually putting developing countries especially those in Africa on the brink of extinction and hopelessness, and civil war is apportioning enough time for tensions and killings.

Africa dare not depend on aid. Commitments are the sole wishes of donors. They decide what and when to give. If aid follows this pathway, then aid will be needless for ‘needy’ economies.

It is not surprising when aid does not meet its aspirations. It is because donors clamour for secrecy. They support opaque deals. According to Publish What You Fund, a number of donors seem to be ”attempting to dilute or undermine” commitments to aid transparency “by removing all references to the International Aid Transparency Initiative” and implementation deadlines during the “Working Party on Aid Effectiveness” meeting in Paris this week. When Africa loses nearly $150 billion a year through pervasive corruption, it stands to reason that transparency is a precondition for real aid. How much is invested in poverty and hunger reduction programmes? Only donors and governments of developing countries are aware of what goes out and what comes in. Citizens have been turned spectators -- watching just for the fun of it while they are bear the brunt of poor utilization of those funds.

If aid is for democracy, then citizens reserve the right to know. The right to information is what democracy demands. The ‘Arab Spring’ revolution was the result of frustration with increasing secrecy and a demand for openness. Light should be shed on what governments are doing with the few stipends at their disposal to improve the lots of the poor. 

The ostensibly divergent interest of donor countries and especially Africa on aid brings another question to mind. Is the aid regime teaching Africa to fish? Or is aid driving Africa to fish in water without fish or dead fish? This trend puts the progress of developing economies at risk. 

In all, achieving the Millennium Development Goals by 2015 should set the motion for a new transparent architecture of aid that makes poverty and inequality a priority. Aid that puts ownership of project while dissipating  inherent 'lethal' political and economic interests of donors is what's needed to engender development in ailing developing economies. Again, and critically important, aid in freedom should be delivered. Not aid with unnecessary conditionalities that limit the range of choices of recipient countries.  

With the clock inching closer to the 2015 deadline of the Millennium Development Goals, it is crucial both donors and recipients of aid go beyond the vocal commitments to make aid contribute to equitable pro-poor development. Less of that, Africa should think inwardly for a development miracle. Ensuring effective development in backward economies especially those in Africa is urgent. Explaining the glaring disconnect between aid  and poverty reduction is also crucial for today's policy discourse. Tomorrow may be too late.

By: Stephen Yeboah, Masters candidate in Development Studies, The Graduate Institute, Geneva. The author is also a freelance journalist.

Article was published prior to the High Level Forum on Aid Effectiveness in Busan, South Korea in 2011. Follow the link here: Aid at donor's command

Local-level development in Ghana -- In search of radical rethinking

Decentralization: opportunity or charade?

That Ghana’s decentralization programme is fraught with inefficiencies is never a far cry from reality. The decentralization programme which began in 1988 had an objective of promoting effective and accountable local government in the country with the ultimate goal of clamping down on poverty. Rather the significance of decentralization has been stultifying. Lives in rural areas and even urban communities have increasingly been subjected to a quagmire of crushing poverty while the few so-called elites – stuck in their intellectual conservatism – amass fleeting wealth to themselves.

Of all the obstacles that seemingly hinder the country’s development efforts, “dirty” decentralization is perhaps the most daunting. Though they are known to be society elites they are as well “functional illiterates” – who do not understand the meaning of development. The reasons  for increased rural poverty, primitive agriculture practices, inaccessible potable water and health facilities are not far-fetched. The local governance systems meant to cater for grassroots concerns are all broken and have simply been rendered dysfunctional. 

Sekyere South District happens to be one of the twenty seven (27) districts in Ashanti Region. The district, upon personal experience, has sadly been the epitome of a broken and dysfunctional decentralization. A district with all the available good conditions to support viable economic activities and varieties of crops including cocoa and coffee simply lives outside its vision and mission. With its inspirationally engraved vision of “creating the necessary conditions for private sector development through job creation and access to basic services by actively involving the masses in the decision making process”, one is pricked to assume if even there is poverty in the region. This vision, however, smacks of a complete 'cartoon' paradox.

Poverty continues to exact its ravaging effects on the majority. The fate of smallholder farmers is as unpredictable as the rains they depend on to farm. Delving into the issue of local governance in the metropolitan, municipal and district assemblies, one is tempted to believe if Ghana is really committed in the fight against poverty, hunger and backwardness. Setting priorities to achieve the Millennium Development Goals by 2015 mean nothing to national and local political leaders and civil and public servants. It is disheartening to witness how the concept of decentralization is being outrightly disregarded. How structures of decentralization have being manipulated by the few to satisfy their illegitimate selfish interests. 

In most metropolitan, municipal and district assemblies (MMDAs), laws governing local government structures are simply taken for granted. Hypocritically infused with the ethos of participatory governance, the few stand for themselves and how to fill their ‘stomach’ is their agenda all day. They are rather representative of themselves thinking of nothing good but how to line their pockets to the detriment of the ordinary poor. In their frenzy attempt to amass cheap wealth, viable projects are at best delayed. Again, a project that would seemingly not bring money to the pocket of one person or a “clandestine group” would not be undertaken simply because signatories may not be ready to validate the withdrawal of funds for projects that benefit the poor. Even worrying is that amidst the display of these shameful attitudes, several kilometers of roads in the district are poor and dusty, affecting the ease with which people move and agriculture produce are transported to the market. Children still sit under trees or dilapidated structures to access basic education. People travel kilometers to access potable water and health.

Indeed, we should not expect as a nation to see development [not interventions from the World Bank, IMF] if these shameful and outrageous attitudes persist. For reasons unknown, the government, development experts, aid agencies and multilateral institutions assume that such lawlessness and banditry at the local government level have no effect whatsoever on local economic development. The destruction being caused by the country’s local governance system is first eroding public confidence and trust and also denying the people the right to development. This is a break in social compact that has the propensity to engender social unrest and public discontent.

The reason for the struggle of Ghana to extend the benefits of development to the poor could be attributed to the pageantry of selfishness and insensitivity of people at full display in MMDAs. What’s happening in Sekyere South District is a sign of a national canker. Sekyere South District is a sad scenario where local government and national constitutional laws are easily flouted with impunity.

This article is not meant basically to disclose the blatant anomalies in Sekyere South District Assembly and all MMDAs but to shed light on activities holding back the progress of the nation. Definitely, intrinsic and regular monitoring is needed at the local government level if development can be realized. These attitudes being exhibited are rather worsening and 'glorifying' rural poverty and underdevelopment. It's obviously unacceptable. It is about time poverty was eradicated in rural areas. The district structure of governance in its deep state of vulnerability demands urgent rethinking and restructure.

It is increasingly clear that such antics and obsession with individualism to the neglect of the peoples welfare not only contradict contemporary development agenda but also infringe upon the inalienable rights of the people to development.

From the foregoing, it is the truth that decentralization needs a deliberate didactic re-structuring geared toward changing attitudes of civil and public servants and instilling a sense of responsibility. The voices of the local people are powerful to demand better governance and accountability. Massive education and empowerment at the local level will offer a potential counter-effect to this mess being witnessed. The nation needs to battle against increasing illiteracy. This as such calls for an increased investment in both formal and informal education. Education and empowerment that is needed to generate awareness of the people to hold officials in check. Again, the local should be made to have a say in the day-to-day implementation of projects and programmes.

By: Stephen Yeboah, Geneva

World Food Day: worth celebrating?

Picture source: FAO

It is yet another solemn year to move in line with the formalities of celebrating World Food Day in the midst of escalating famines, hunger and hard-hitting malnutrition levels in developing economies. The question that begs: Is World Food Day worth celebrating?

World Food Day was proclaimed in 1979 by the Conference of the Food and Agriculture Organization (FAO). It marks the date of the founding of FAO in 1945. The aim of the Day is to heighten public awareness of the world food problem and strengthen solidarity in the struggle against hunger, malnutrition and poverty.

In 1980, the General Assembly endorsed observance of the Day in consideration of the fact that "food is a requisite for human survival and well-being and a fundamental human necessity" (resolution 35/70 of 5 December 1980).

Today marks another moment to take a hard look at global policies toward ensuring food security and consequently eradicating hunger. The theme for this year "Agriculture cooperatives: key to feeding the world" acknowledges the significance of farmers' cooperatives in agriculture production. Cooperatives remain a key strategy toward ameliorating existing state of small-holder farming in developing countries.

With the challenges and inherent constraints that have characterized agriculture, World Food Day should aim at consciously addressing the escalating issues of famine, high food prices and worsening living of small-holder farmers.

World Food Day should be celebrated with the deepest sense of hope of reducing famine, hunger and increasing levels of malnutrition in developing countries.

By: Stephen Yeboah, Development Journalist and Practitioner, Geneva.

870 million people chronically undernourished - new hunger report

Undernourishment is linked to food insecurity. Picture source: Maplecroft

.....But there are hopeful signs that with extra effort the MDG target can be reached

Nearly 870 million people, or one in eight, were suffering from chronic undernourishment in 2010-2012, according to the new UN hunger report released October 9.

The State of Food Insecurity in the World 2012 (SOFI), jointly published by the UN Food and Agriculture Organization (FAO), the International Fund for Agricultural Development (IFAD) and the World Food Programme (WFP), presents better estimates of chronic undernourishment based on an improved methodology and data for the last two decades.

The vast majority of the hungry, 852 million, live in developing countries -- around 15 percent of their population -- while 16 million people are undernourished in developed countries.
The global number of hungry people declined by 132 million between 1990-92 and 2010-12, or from 18.6 percent to 12.5 percent of the world's population, and from 23.2 percent to 14.9 percent in developing countries - putting the MDG target within reach if adequate, appropriate actions are taken.

The number of hungry declined more sharply between 1990 and 2007 than previously believed. Since 2007-2008, however, global progress in reducing hunger has slowed and leveled off.
"In today's world of unprecedented technical and economic opportunities, we find it entirely unacceptable that more than 100 million children under five are underweight, and therefore unable to realize their full human and socio-economic potential, and that childhood malnutrition is a cause of death for more than 2.5 million children every year," say José Graziano da Silva, Kanayo F. Nwanze and Ertharin Cousin, respectively the Heads of FAO, IFAD and WFP, in a foreword to the report.

"We note with particular concern that the recovery of the world economy from the recent global financial crisis remains fragile. We nonetheless appeal to the international community to make extra efforts to assist the poorest in realizing their basic human right to adequate food. The world has the knowledge and the means to eliminate all forms of food insecurity and malnutrition," they add.
A "twin-track" approach is needed, based on support for broad-based economic growth (including in agriculture) and safety nets for the most vulnerable.

Impact of economic crisis
The new estimates suggest that the increase in hunger during 2007-2010 was less severe than previously thought. The 2008-2009 economic crisis did not cause  an immediate sharp economic slowdown in many developing countries as was feared could happen; the transmission of international food prices to domestic markets was less pronounced than was assumed at the time while many governments succeeded in cushioning the shocks and protecting the most vulnerable from the effects of the price spike.
The numbers of hunger released today are part of a revised series that go back to 1990. It uses updated information on population, food supply, food losses, dietary energy requirements and other factors. They also better estimate the distribution of food (as measured in terms of  dietary energy supply) within countries.
SOFI 2012 notes that the methodology does not capture the short-term effects of food price surges and other economic shocks. FAO is also working to develop a wider set of indicators to better capture dietary quality and other dimensions of food security.

MDG target within reach
The report suggests that if appropriate actions are taken to reverse the slowdown in 2007-08 and to feed the hungry, achieving the Millennium Development Goal (MDG) of reducing by half the share of hungry people in the developing world by 2015 is still within reach. "If the average annual hunger reduction of the past 20 years continues through to 2015, the percentage of undernourishment in the developing countries would reach 12.5 percent - still above the MDG target of 11.6 percent, but much closer to it than previously estimated," the report says.

Asia leads in number of hungry; hunger rises in Africa
Among the regions, undernourishment in the past two decades decreased nearly 30 percent in Asia and the Pacific, from 739 million to 563 million, largely due to socio-economic progress in many countries in the region. Despite population growth, the prevalence of undernourishment in the region decreased from 23.7 percent to 13.9 percent.

Latin America and the Caribbean also made progress,  falling from 65 million hungry in 1990-1992 to 49 million in 2010-2012, while the prevalence of undernourishment dipped from 14.6 percent to 8.3 percent. But the rate of progress has slowed recently.
Africa was the only region where the number of hungry grew over the period, from 175 million to 239 million, with nearly 20 million added in the past four years. The prevalence of hunger, although reduced over the entire period, has risen slightly over the past three years, from 22.6 percent to 22.9 percent - with nearly one in four hungry. And in sub-Saharan Africa, the modest progress achieved in recent years up to 2007 was reversed, with hunger rising 2 percent per year since then.

Developed regions also saw the number of hungry rise, from 13 million in 2004-2006 to 16 million in 2010-2012, reversing a steady decrease in previous years from 20 million in 1990-1992.

Agricultural growth to reduce hunger and malnutrition
The report underlines that overall growth is necessary but not sufficient for a sustained hunger reduction. Agricultural growth is particularly effective in reducing hunger and malnutrition in poor countries since most of the poor depend on agriculture and related activities for at least part of their livelihoods. Agricultural growth involving smallholders, especially women, will be most effective in reducing extreme poverty and hunger when it generates employment for the poor.

Growth must not only benefit the poor, but must also be "nutrition-sensitive" in order to reduce various forms of malnutrition. Reducing hunger is about more than just increasing the quantity of food it is also about increasing the quality of food in terms of diversity, nutrient content and safety.

For even while 870 million people remain hungry, the world is increasingly faced with a double burden of malnutrition, with chronic undernourishment and micronutrient malnutrition co-existing with obesity, overweight  and related non-communicable diseases (affecting more than 1.4 billion people worldwide).
To date, the linkage between economic growth and better nutrition has been weak, the report says, arguing for an integrated agriculture-nutrition-health framework.

Social protection systems
Growth is clearly important, but it is not always sufficient, or rapid enough. Hence, social protection systems are needed to ensure that the most vulnerable are not left behind and can also participate in, contribute to and benefit from growth.

Measures such as cash transfers, food vouchers or health insurance are needed for the most vulnerable who often cannot take immediate advantage of growth opportunities. Social protection can improve nutrition for young children - an investment that will pay off in the future with better educated, stronger and healthier adults. With effective social protection complementing inclusive economic growth, hunger and malnutrition can be eliminated.

Source: International Fund for Agriculture Development (www.ifad.org), Press release No.: IFAD/61/2012

Food security in 75% of African countries at high or extreme risk – Maplecroft global index

Food insecurity remains a major global policy challenge. Picture source: Maplecroft

Despite strong economic growth, food security remains an issue of primary importance for Africa, according to a new study by risk analysis company Maplecroft, which classifies 75% of the continent’s countries at ‘high’ or ‘extreme risk.’

In the light of recent food price spikes, the findings are especially significant for areas of sub-Saharan Africa where poverty, armed conflict, civil unrest, drought, displacement and poor governance can combine to create conditions where a food crisis may take hold.

Africa accounts for 39 of the 59 most at risk countries in Maplecroft’s Food Security Risk Index and hosts nine of the eleven countries in the ‘extreme risk’ category. These include: Somalia and DR Congo (ranked joint 1st in the index), Burundi (4), Chad (5), Ethiopia (6), Eritrea (7), South Sudan (9), Comoros (10) and Sierra Leone (11). The countries of Haiti (3) and Afghanistan (8) complete the category.

The Food Security Risk Index has been developed for governments, NGOs and business to use as a barometer to identify those countries which may be susceptible to famine and societal unrest stemming from food shortages and price fluctuations. Maplecroft reaches its results by evaluating the availability, access and stability of food supplies in 197 countries, as well as the nutritional and health status of populations.


Droughts hit global food prices, raising fears of a food crisis
The fragility of global food security was once again thrown into the spotlight this year after the USA’s worst drought in 50 years drove corn prices to near record highs, while wheat also climbed on the back of a 10% drop in production across the Former Soviet Union. Low crop yields pushed global food prices up 6% in July 2012, sparking fears of a repeat of the 2007/2008 food crisis, which resulted in food riots across several countries, including Bangladesh, Cote d’Ivoire, Egypt, Mexico, Senegal and Yemen.

“Food price forecasts for 2013 provide a worrying picture,” states Maplecroft’s Head of Maps and Indices Helen Hodge. “Although a food crisis has not emerged yet, there is potential for food related upheaval across the most vulnerable regions, including sub-Saharan Africa.”
A September report by Rabobank, a financial specialist in agro-commodities, estimates that prices of food staples could rise by as much as 15% by June 2013, resulting in record highs that will squeeze household incomes in many countries.

Conflict and instability driving food insecurity in Somalia, DR Congo and the Sahel
Food security is a complex issue, which is driven by a number of factors, including armed conflict, which can acutely affect levels of agricultural output and investment. Nowhere is this seen more intensely than in the countries topping the Food Security Risk Index, Somalia and DR Congo (DRC), where sustained violence has had a profound impact on the economic circumstances of their governments and populations.
Ongoing conflict in DR Congo has left huge numbers of civilians unable to secure access to sufficient stable food supplies and the population remains vulnerable to price shocks, as entrenched poverty means a large proportion of household expenditure is spent of food. DRC’s eastern provinces have been subject to armed conflict for more than a decade. According to the UN, as of mid-June, at least 400,000 people were displaced in this region and long-term food security has been put at further risk, as civilians have been forced to flee from their fields during the crucial harvest period.

Maplecroft also highlights the Sahel, which includes the countries of Chad (ranked 5th in the index), Niger (23), Mauritania (38), Mali (42), and Burkina Faso (45), as an important region to watch. Each of these countries has seen substantial increases in risk in the Food Security Risk Index over the last 3 years due to armed conflict, political instability, changing rainfall patterns and locust infections. Risks for the region are forecast to remain high.

The impacts of food inflation in Arab states
Aside from being aggravated by conflict, food security issues can also create civil unrest and political instability when populations are driven to large scale protests by inflationary pressures on staple foods. In 2011 rising food prices were a contributing factor to the protests in Tunisia and Egypt, which led to popular revolutions and inspired the ‘Arab Awakening’ across the Middle East and North African (MENA) region.
Countries with the highest risk across MENA include Yemen (ranked 15th), Syria (16), Iraq (54) and Libya (58) all of which are classified as ‘high risk.’ Egypt (71) and Tunisia (100) are meanwhile categorised as ‘medium risk.’ The region remains at elevated levels of risk from reduced US and Russian crop production, as these countries rely heavily on cereal imports and are therefore vulnerable to market prices.

“The drivers of the ‘Arab Awakening’ were varied and complex and included long standing public anger at high levels of governmental corruption and oppressive tactics against populations and political opposition,” states Maplecroft CEO Alyson Warhurst. “When these factors combine with food insecurity, sparked by rising global prices, it can create an environment for social unrest and regime change. Identifying these markers is a key challenge in the identification of threats to political stability and business continuity.”    

Source: Maplecroft.com

Eurozone reform and austerity is a policy disaster – Amartya Sen

Picture source: The Guardian

Amartya Sen, Nobel Memorial Prize Laureate and Professor of Economics and Philosophy at Harvard University has described the binding together of reform and austerity as a solution to the Eurozone crisis as not only intellectually confused but also a policy disaster. This was disclosed when he delivered the academic opening year lecture of Graduate Institute of International and Development Studies entitled “What’s the use of Economics?” in Geneva October 3, 2012.

Prof. Sen stated that the current strategy being imposed on European countries in financial difficulties is not going to resolve the crisis. “The Euro crisis is not going to be resolved by merely bailing out countries in financial difficulties”, he said adding that “it is difficult to see how austerity can be a soundly reason in economic solution to the European malaise today”. He expressed doubts whether austerity will steer economies plunged in excessive public debts out of their immediate problems. Prof. Sen advised austerity is not the effective way of reducing public deficit. “It may not be plausible way of reducing public deficit at all”, he stated adding that "for the fact that it [austerity] hasn't led to that [reducing public deficit] should not come as a surprise."

Making an exposition on the financial crisis that has bedeviled European countries especially Spain, Greece and Portugal, he argued that the implementation of austerity along with reform has undermined the impacts of real reform. “One of the worst aspects of the policy of austerity being comprehensibly imposed along with reform has been undermining the feasibility of real reform”, Prof. Sen asserted while explaining that “this has confounded two distinct agendas: reforms of bad administrative arrangements such as people evading taxes, of government serving using favouratism and for that matter preserving unviable conventions about retiring age; and austerity in a form of ruthless cuts on public services and social securities”. He advised there should be a clear distinction between reforms of bad administrative arrangements and cuts in public services though the requirements for a financial discipline have tendered to amalgamate the two.

Professor Amartya Sen warned leaders of European countries of the significant impact of austerity to outside borders. He said the impacts of austerity are not felt only within the borders of one country but in other countries through international trade and exchange. He stated that “austerity is an odd way of trying to cut down deficit” indicating again that “one country’s austerity is a dampener for the economic outcome expenses of other countries as well”. He advised that a good trading system could function alongside providing the necessary public services.

Meanwhile, The Guardian [www.guardian.co.uk] reports on Thursday October 4 that Institute of International Finance (IIF), an influential group of international banks and insurers, has attacked political leaders in Europe over their handling of the Greek crisis, arguing that the singleminded pursuit of austerity has made the situation worse. The Chairman of IIF, Charles Dallara in highlighting the associated challenges of austerity is quoted as saying "The world economy appears to be stuck at the crossroads, being pushed in one direction by easier monetary policy, and pulled in another by fiscal austerity". "The international financial community has a collective interest in reducing the uncertainty that currently surrounds the global economic outlook. If we want to lay the basis for a durable global economic expansion, then we need to see more concerted action by the world's policymakers", said Mr. Dallara.

As part of efforts to curtailing the persistent crisis, Eurozone finance ministers will meet in Luxembourg on Monday October 8 for the inaugural meeting of the Board of Governors of the European Stability Mechanism (ESM), bound to replace the European Financial Stability Facility as the Eurozone’s permanent bail-out fund. German Chancellor Angela Merkel will also visit Greece for the first time since the Eurozone debt crisis erupted this week widely seen as a show of support for Athens.

Story by: Stephen Yeboah, in Geneva, Switzerland [profstephenyeboah@gmail.com]

Graduate Institute awards Nobel Prize Laureate Amartya Sen

Picture source: The Graduate Institute

The Graduate Institute of International and Development Studies, a leading academic institution in the study of international affairs, has awarded Amartya Sen, Nobel Memorial Prize Laureate and Professor of Economics and Philosophy at Harvard University with the Edgar de Picciotto International Prize. At a well-organized public lecture to mark the opening of the academic year of Graduate Institute of International and Development Studies at the Council Room of the World Trade Organization in Geneva October 3, 2012, Mr. Edgar de Picciotto presented the award to Professor Sen for his immense contribution in welfare and development economics and for the fight against poverty, inequality and famine. The theme for the public lecture was “What is the use of economics?”

In his introductory speech, Director General of the World Trade Organization, Pascal Lamy praised the contribution of Amartya Sen in economics that has benefitted trade. “Most of his work has been of benefit to the house of trade”, Lamy said. He again stressed the significance of international trade to the promotion of economic growth and prosperity in countries. “Trade has been the vehicle of prosperity in many countries”, Lamy said adding that trade offers new and diverse opportunities for growth in health, education, and access to credit.

The Edgar de Picciotto International Prize created by the Graduate Institute of International and Development Studies shows gratitude and pays homage to Mr. de Picciotto and his family for their exceptionally generous support to major infrastructure development at the Institute especially with the financing of the Student House. The prize awards internationally renowned academics, who through their research have contributed to the better understanding of global challenges, and whose work has influenced policy-makers. The prize is awarded every two years.

Professor Amartya Sen in his appreciation for the award thanked the Graduate Institute of International and Development Studies for the recognition. “It is an honour to receive this prize”, he said adding that I am not worthy of the award since people had contributed to my knowledge. He expressed his excitement for having to begin the academic year as a speaker for the occasion.

Professor Amartya Sen is one of the world’s most renowned and respected economists. Professor Sen is the author of numerous books which have been translated to more than 30 languages. His work has focused most notably on the causes of famine, inequality and poverty. The United Nations Development Programme (UNDP) human development index was developed in part based on his research. He has also received a Nobel Memorial Prize in Economic Sciences 1998; the “Bharat Ratna” (the highest honour awarded by the President of India); the Edinburgh Medal; the Brazilian Ordem do Merito Cientifico; the Eisenhower Medal; Honorary Companion of Honour (UK); and the George C. Marshall Award (US).

Story by: Stephen Yeboah, in Geneva, Switzerland (profstephenyeboah@gmail.com)

Switzerland pledges 11 billion francs to fight poverty, hunger globally

MDG 1

The Federal Councillor Didier Burkhalter has disclosed that Switzerland will dedicate 11 billion francs to fight against hunger, thirst, poverty and diseases in the world from 2013 to 2016. This was revealed by Federal Councillor Didier Burkhalter during a public lecture jointly organized by the University of Geneva, Graduate Institute of International and Development Studies, Foundation of Geneva and the Switzerland Confederation 10 September under the theme “The United Nations and Switzerland in a changing world”.

In his speech delivered at the University of Geneva, Mr. Burkhalter said the Federal Council has requested 11 billion francs for Parliament to discuss adding that the fight against poverty and hunger forms part of the “values ​​that the Federal Constitution defines as the objectives of the foreign policy of Switzerland”.  He again explained that the 11 billion francs indicates an “expenditure of one franc per inhabitant per day in this country, which will fight against hunger, thirst, poverty and disease in the world.” The fund will be used for the development of trade and commerce developing countries. “The fight against poverty also entails the development of trade and commerce that Switzerland wants to promote and develop, especially here in Geneva because she knows its history, it is the best way out of the country poverty”, Mr. Burkhalter said.

He indicated foreign policy is both a defense of legitimate interests and the promotion of values and outlined the five values of Switzerland of which the fight against poverty forms the fourth value. The other values include the promotion of human rights, democracy, peace and the protection of the environment and resources.

The UN Secretary-General Ban Ki-moon in his address at the public lecture commended Switzerland for its contribution to the eradication of poverty and hunger in the world. The UN Secretary-General said, “I am very grateful for such a strong commitment and leadership from Switzerland’s government to eradicate this poverty by investing in people” adding that “it is a great encouragement to all of us.” He applauded the fortitude and resilience of Switzerland toward increasing foreign aid in the era of economic crisis. “I commend Switzerland for its commitment to development.  At a time when countries are cutting back on aid, Switzerland is stepping up. Switzerland is increasing assistance, investing in people and leading by example”, Ban Ki-moon said.

The public lecture held at the premises of the University of Geneva marks the tenth year of the membership of Switzerland to the United Nations. Switzerland hosts the European headquarters of the UN in Geneva.

By Stephen Yeboah, in Geneva, Switzerland [profstephenyeboah@gmail.com]

First published on: www.ghanabusinessnews.com

www.ghanabusinessnews.com/switzerland-pledges-11-billion-francs-to-fight-poverty-hunger-in-the-world/

Poverty and development issues: UN Secretary-General addresses Switzerland Parliam...

Poverty and development issues: UN Secretary-General addresses Switzerland Parliam...: The United Nations (UN) Secretary-General, Ban Ki-moon will address the Federal Assembly of Switzerland in Bern 11 September as part of t...

UN Secretary-General addresses Switzerland Parliament today

The United Nations (UN) Secretary-General, Ban Ki-moon will address the Federal Assembly of Switzerland in Bern 11 September as part of the 10^th anniversary of the accession of Switzerland to the UN. This was revealed by Federal Councillor Didier Burkhalter during a public lecture jointly organized by the University of Geneva, Graduate Institute of International and Development Studies, Foundation of Geneva and the Switzerland Confederation 10 September under the theme “The UN and Switzerland in a changing world”.

In his speech delivered at the University of Geneva, Didier Burkhalter stated that the presence of Switzerland at the UN “allows us to act more effectively and directly to good causes and we cherish above all in our efforts to contribute to peace and security and to exercise active solidarity” adding that “this presence has also increased our influence and ability to act. Therefore both our solidarity, our responsibility and sovereignty are strengthened.” 

A media release by the Swiss Parliament states that the National President Hansjörg Walter and Senate President Hans Altherr will speak. The release also indicates that before his speech to the councils, the UN Secretary-General meets the Federal Room of the Parliament building with a delegation of councilors adding that “the visit of the UN Secretary General in the Federal Assembly reflects the great esteem, which has for the World Organization of the national governments of Switzerland and its commitment to human rights and democracy.”

Switzerland joined the UN on 10 September 2002 and is the 190^th member state of the UN.

By Stephen Yeboah, Geneva, Switzerland

A SALUTE TO A TRUE PATRIOT: PROF. J.E.A. MILLS

It is with great pity and a heavy heart that I write these words in appreciation of an honorable, humble and brilliant man who once served as the President of the Republic of Ghana, Professor John Evans Fiifi Atta Mills. I may not have known him personally nor was I too pleased with his failure to take decisive actions on some critical national issues and inability to put some members of his cabinet in check. My perception of his performance as the president was more indifferent yet with great respect for his integrity, intellectual prowess and calm demeanor.

In my memory, I vividly recall him stuttering unusually in a speech at his acceptance into office as the president of Ghana. I wondered why a lawyer and a professor for that matter could demonstrate such lack of confidence on such a grandeur occasion; this in retrospect seems to be as a result of his deteriorating health. Whilst others enjoyed the spectacle of seeing him fumble several times in his speeches, it was with sympathy and a grave concern I had, wishing he does not commit another blunder. Using a great sense of pity to describe how I feel about his demise is a reflection of the utter disgust I felt each time there was a less objective critique by some even less accomplished country folks who mocked him. The countless ad hominem ranged from being described as sexually impotent, sight and hearing impaired, childless, accusation of possessing black palms and a ring that gave him some dark supernatural powers and worse-off  an ironical comparison to a disoriented mortuary attendant. One time at a meet-the-press conference, I came to terms with his dissension and frustration at being the subject of endless taunts and mockery when he lamented that his name has been devalued to less than one Ghana Cedi. His entire presentation for that session was dominated by sarcastic and less objective remarks, to the extent that I felt his ironic response to some of the questions depicted his bottled-up frustration at the incessant ingratitude and disrespect for him and his office. Though this may be my honest opinion on the circumstance that prevailed, I grew to appreciate his passion, sincerity and calm in the face of all the distractive and blatantly degrading comments.

In his absence today, I cannot help but feel ashamed of the ‘verbal torture’ the people he once served put him through. I write in absolute respect for an accomplished intellectual and a true public servant, more so as a young African, I am inspired by his selfless decision to get out of his comfort zone of academia and to be involved in the dirty politics of his time yet with a sincere desire to make a difference in the development of mother Ghana. You have my respect, true soldier. Damirifa Due Prof.

Credit: Kwame Akoto-Danso (akotodansokwame@gmail.com)

Reversing the mining blunder in Ghana: Miracle or Mirage?

If we did a proper cost-benefit-analysis of the mining industry in Ghana, taking into account the environmental and social cost, we’d be getting nothing” - Daniel Owusu-Koranteng, Executive Director of WACAM (credit: DanWatch and Concord Danmark Report, 2010)

Known to be the proprietor of valuable natural resources in the world, the African region was expected to be a haven that would soothe the excruciating pains of tattered penury amongst its people. Contrary is the situation on the ground. With potentially large oil fields and abundant mineral reserves, poverty continues to have a firm grip on majority of the people. In Paul Collier’s “The Bottom Billion”, the scholar defines the ‘bottom billion’ as the lowest-income segment of the world’s population, living in countries with seemingly intractable economic and political problems and long track records of poverty and stagnation. Nearly a third of these people live in countries where resource extraction dominates the economy (World Gold Council, 2009). Against the backdrop of this paradoxical phenomenon, the polemic of the resource curse has been kept much alive in resource-rich economies especially in the African region. The issue of intrinsic consideration has been whether or not the presence of natural resources has been beneficial or detrimental.

For centuries of gold mining and other mineral extraction in Ghana, it is widely argued that the prospects of these mineral resources have not left any easy blueprint for ensuring sustainable development and poverty alleviation. Though mining constitutes the largest source of foreign direct investment and that minerals are the leading export earner, the sector has not helped reduce poverty and other development challenges. With the influx of multinational mining companies, the situation has been development that largely benefits these companies to the neglect of people and the economy at large. Despite boom in demand and prices of minerals, the woes of people and countries in the African continent especially Ghana keeps deepening with no end in sight. The deserving question to pose is that what has been the devil in the details of operations of mining that has brought this untold hardship to people?

In a report by DanWatch and Concord Danmark titled “Golden Profits on Ghana’s Expense – An example of incoherence in EU policy” in May 2010, “substantial growth has eluded the African continent by reasons of loopholes in the EU’s tax legislation, limited regulation of tax havens and lack of transparency in accounting standards for multinational companies. These have allowed massive illicit financial flows from Africa to tax havens in Europe and across the rest of the globe”. In that same report, it is stated that new research shows that over the period 1970-2008, Africa lost US$854 billion in cumulative capital flight just enough to wipe out the region’s total outstanding debt and leave US$600 for poverty alleviation and economic growth. From 2000 to 2008 the illicit outflows from Africa accelerated by 25 percent coinciding with boom in natural resource prices and international trade. In furtherance of this dreadful development, as stated in the report, on a global scale approximately US$1 trillion is now illegally moved out of developing countries every year, about two thirds of it due to commercial tax evasion. The capital flight from poor countries amount to eight times total global development assistance”

In essence, these facts justify why poverty abounds in the African region especially Ghana even in the presence of potential mineral resources. These are the blunders associated with mining that has exacted huge costs on the region. Is there any hope for the future for economies in Africa? What about Ghana? Mining has brought in its wake funds passing under the bridge and has steadily plundered the country’s deserved wealth.

BREAKING THE CURSE

Even in the midst of identified challenges in the mining industry in the African region, evidence suggests that Botswana has been able to sustain its economy to the path of growth and stability using diamond. This indicates that after all, when prudent strategies are fashioned out, the sector can see a broad day light.

The missing ingredient behind the doom of resource-rich countries is financial transparency. Transparency is perhaps the most innovative and most talked-about aspect of the global fight against the resource curse. Let us narrow the arguments to Ghana. Being the second largest producer of gold in Africa, it goes without saying that Ghana is a victim of dishonest capital flight and untaxed or under-taxed revenues. In her bid to fight the impacts of the resource curse, the country accepted to be a candidate of the Extractive Industries Transparency Initiative (EITI), an independent and voluntary standard for creating transparency, in September 2007. However, the mining sector has experienced long periods of gruesome secrecy.

There has been a milestone step towards financial transparency that would serve to benefit the African region and Ghana to be specific. The U.S. Congress has passed the financial transparency law as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act which includes a provision that requires oil, gas and mining companies registered with the U.S. Securities and Exchange Commission (SEC) to disclose how much they pay to foreign countries and the U.S. government for oil, gas, and minerals. The provision was based on the Energy Security through Transparency Act (S. 1700), which was championed in the U.S. Senate by a bipartisan group of legislators led by Senators Benjamin Cardin (D-MD) and Richard Lugar (R-IN), with Patrick Leahy (D-VT) introducing the provision as an amendment during the conference negotiations for the bill (PWYP-United States).

Now, President Obama has signed the bill into law on July 21, 2010 at the massive Ronald Reagan Building. The US President on that Wednesday said “Today, thanks to a lot of people in this room, those reforms will become the law of the land." This signals the turning point for the sweeping overhaul of financial regulations in the extractive industries around the globe.

This has been described as unprecedented considering the nagging challenges the fight for transparency and openness have experienced. As part of the legislation, all oil, gas and mining companies registered with U.S. stock exchanges will be covered. According to Publish What You Pay-United States, the measure covers 90 percent of the world’s largest internationally operating oil and gas companies, and eight of the world’s ten largest mining companies. It will, as a result, provide citizens in nearly every country around the globe with much needed information. In Ghana, many mining, oil and gas companies that operate within the borders of the country are registered with SEC. For example, Newmont Mining, Anglo-Gold Ashanti, Gold Fields Ghana, Goldenstar Resources (and others) are registered with the SEC.

There is therefore every reason to believe that the revenue distribution in the mining sector to sub-national governments will witness an enormous change with regard to the right amount these companies pay and the amount government receives. The local people would now be equipped with a unique tool to hold their leaders to account. It still remains a fact that mining in Ghana has rarely had a glorious history. Obuasi, Tarkwa and other typical mining towns with their huge contribution to mineral wealth have nothing special to boast of. Infrastructure development and livelihoods are in tatters and environmental damages have been rendered normal.

THE MOMENT IS NOW!

This is an opportune moment for the country to track all revenues in the sector to ensure that basic services like healthcare, education, job creation do not continue to be a mirage. The legislation requires that companies that engage in the commercial development of oil, natural gas or minerals, will have to include in their annual reports filed with the U.S. Securities and Exchange Commission (SEC) the type and total amount of payments made for each project; and, the type and total amount of payments made to each government for the purpose of commercial development of oil, natural gas or minerals.

It is responsible that multinational and local mining companies operating in the country adjust their structures to best suit the implementation of this reform. Financial transparency would provide the right tool to check underpayments in extractive industry revenues, tax evasions and illicit financial flows from the country. These are precisely the issues behind the country’s underdevelopment hinged on the mining sector. In the light of these strategies, the institutions in charge of tracking revenue flows should be adequately capacitated to carry out better revenue reporting without any form of inducement or favour. 

According to the report by DanWatch and Concord Danmark, Ghana is amongst the ten low-income countries in the world that lose most of their entitled taxation as a consequence of price fixing. Since 2007 Ghana has thus lost approximately 36 million euros. These are hefty amounts that could solve the country’s financial incapacities to infrastructure development.

CONCLUSION

It is about time the country restored the lost glory of the mining sector. Revenues that accrue from the mining sector should be channeled to providing basic services to the poor. It now behooves the civil society groups and organizations to shed light on revenues and overall operations of mining companies and government to set the stage for accountability and prudent management of the people’s money. The comprehensive publication of revenue flows will ensure a level playing field that would extirpate unwarranted contentions and suspicions. Certainly, Ghana ought to use the benefits of the sweeping US Congress financial transparency reforms to reverse the unmerited mining blunder. The transparency legislation will clearly provide momentum for sorely-needed changes in the mining sector and even the emerging oil and gas sector. Ghana can make it if we change the order of things now! 

BIBLIOGRAPHY
World Gold Council (2009), The Golden Building Block: gold mining and the transformation of developing economies. With an economic life-cycle assessment of Tanzanian gold production, September, 2009
DanWatch and Concord Danmark (2010), “Golden Profits on Ghana’s Expense – An example of incoherence in EU policy” May 2010
Publish What You Pay, PWYP Press Push for U.S. Transparency Legislation – Some Points for PWYP Coalition Press Releases, July 13, 2010 United States