Category: Natural Resources

Which African leaders will truly emulate the achievements of John Pombe Magufuli?

by Sang N., posted in Africa, African, Development, Investment, Natural Resources, Opinion, Politics
Presidents John Pombe Joseph Magufuli of Tanzania, 1959 – 2021.

Since his passing, quite a lot has been said about the life and works of Tanzania’s recently deceased president. And by most fair and sincere accounts, John Magufuli did have a tangible, measurable, commendable and signficant impact on Tanzania, taking the country along an admirable trajectory from a low income country up to the point Tanzania is now firmly considered to be a middle income country.

And most Tanzanians loved him for it.

And yet across Africa, although such success stories inspire millions and should in theory be common – they don’t happen very often, owing to a long list of failures, among them poor and uninspired leadership.

But if John Magufuli – who it must be said didn’t come from some grand or otherwise priviledged background that gave him special advantages – can achieve what he did in as short a space of time as 6 years, why can’t other African leaders do the same?

Power & Status

It is no secret that many leaders in Africa are drawn to political leadership for other reasons. They are not overly concerned about the problems their countries face, or the poverty and hardship. The overriding intention is not so much to provide good and transformative leadership in the way Magufuli did, instead a worrying number of African leaders are more bothered about power and status, leaving a leadership void in those countries, and consequently affecting the scale and pace of development.

These are the people who like to attend heads of state meetings of SADC, UN, AU, ECOWAS, etc. complete with stays in pricey hotels; they like to have smarmy business executives of dodgy companies attend state house to meet them – because it can be spun into an investment story; they love to be seen on the front covers of newspapers, to be interviewed by the likes of Al Jazeera, CNN or France 24 – making all sorts of grandiose promises, which years later, can’t be backed by any tangible achievements; they love to have the doors of their Mercedes Benz limousines opened by well dressed, neatly-shaven and altogether reverent bodyguards – who make them appear more important than they actually are; they like to attend every insignificant function that comes along, where they can be seen to be doing something or to please supporters – even when the impact of such functions on a national level is negligible and a single junior minister could have been dispatched to it. Increasing the salaries of top military officials or the trip to the UN General Assembly means more to such leaders than funding the education and welfare of poor kids in their countries’ ghettos; they like to see a band of protocol-obsessive allowance-seeking hand-clapping minions nod approvingly at everything they say, flanking them at press conferences, worshipping them on social media, inflating the sizes of their convoys, and generally putting out a false and deceptive apperance of competence and authority. For these kind of leaders, a picture taken with Barack Obama at the White House or with Bill Clinton or Richard Branson at some international conference means more than actually getting down to the hard work of resolving the youth unemployment crises in their own countries. They will talk endlessly of courting investors and trying to attract investment at these high level international gatherings, but years on – absolutely nothing comes out of it.

That love of glamour and status is more about pomp (the same english word where pomposity comes from) and let’s be absolutely clear when we say it is not leadership, and is exactly the kind of excess leaders like John Magafuli, Thomas Sankara, Patrice Lumumba and even Julius Nyerere would despise.

Centralisation

It doesn’t matter how talented, knowledgeable and practical you think you are, you can’t adequately cater to the needs of millions of people on your own. Even if everyone within your cabinet was churning out tons of raw productivity, even if everyone in the ministries was ontop of their work, even if all government departments were working with superhuman efficiency and at 100% capacity, it’s still not enough to adequately cater for everyone’s needs from good healthcare and housing to employment and skills development, if things remain centralised.

Centralisation is a progress killer in African countries because everyone expects the president, the minister, the technocrats, the guy at the top to sort out everything for everybody. But the guy at the top doesn’t have superhuman powers to do justice to all the needs and requirements of the people he/ she leads or is supposed to represent. And his/ her priorities often are not the same as the priorities of the people in need.

If the impact of our Governments across the African continent is to be revolutionised, if we are to achieve more tangible things in less time, we need to begin to think beyond one man or woman being the person who authorises and pushes through some project or another to completion.

We need to democratise development to the point where we openly and unreservedly bring into the equation those people (or groups) whose lives are affected by governance failings, or under-service that’s not been prioritised, and empower them to be able to make a real difference in their circumstances, be it allowing them to organise themselves, to raise money, buy equipment, or build the infrastructure they need etc. without having to constantly seek authorisation from the central government.

In Malawi it means projects like the Neno road, a new international airport in Mzuzu, the new hospital promised to Michinji, and the Kapiri-Mkanda road among a long list of project promises should be treated as urgent infrastructure projects, and should be escalated, and a stringent implementation schedule set.

District officers and communities involved should be tasked with a new implementation schedule, provided funding that’s closely monitored, and subjected to regular monthly audits to strictly enforce the implementation schedule. They should also be free to solicit their own funding to add to that effort, and any failures, unexplained mishaps or delays should have serious consequences for all involved. That is the kind of thing John Magufuli would be proud of, and we’ve all seen the videos of his similar hard-hitting approach.

The way we fund, monitor and roll out major projects, and the implementation timelines need to be changed fundamentally, for projects to start being executed timely, and for them to be completed on budget.

Party allegiance vs allegiance to the country & the constitution

President Chakwera in Malawis Parliament

One of the qualities which is common in transformative leaders is that they are not afraid of stating the truth and offending powerful people.

In some cases this can be a negative quality and can lead to a leader’s downfall, but in most cases it is a good and necessary quality to have because a great leader needs to have a strong spine. He or she needs to be able to say No, when the situation calls for it. This is important since not everyone who will try and approach or influence an African President (however dignified the title of the influencer is, or however laundered the reputation of their organisation may appear) does so from a good or sincere place. Simply put, not everyone who talks to an African President has noble intentions.

Unfortunately there are so many examples of African leaders capitulating or giving into bad ideas, bad or exploitative deals when pressured, when they should infact have stood their ground firmly and said No.

Now here, I’m not talking about issues like COVID-19 and the COVID-19 vaccines which scientifically have near global consensus on how to manage and deal with, in order to stem the spread of the pandemic.

What I mean is if a leader knows or has been made aware of the toxic influence or otherwise corrupt nature of say one or more of his own ministers or officials; he / she must act, and crack hard to decisively rectify that anomally. Even if individuals in his / her own party thinks the scandal should be ignored.

Similarly, a great leader who wants the best for his people should not allow his country to be heavily indebted to other countries or to international institutions. And if they find the debt when they get into office, they need to aggressively devise as a matter of urgency a workable, practical and stringent plan of managing and paying off the debt.

Old thinking vs 21st Century thinking

Employees at WhatsApp HQ

This fundamentally is about new wine and old wineskins.

The world is not what it was 40 or 50 years ago. While a Nelson Mandela, or a Kamuzu Banda, or a Jomo Kenyatta, or a Robert Mugabe were great and necessary needs for Africa 40 or 50 years ago, our countries at this moment have fundamentally changed and have very different needs and wants to the needs of the 60’s and 70’s; the kind of needs which cannot fully be tackled by using approaches or methods devised by African heavyweights dinosaurs.

That’s not to downplay the achievements of these great men, or to ignore the many rich lessons enshrined in their lives. Not at all. But having said that, many of them weren’t able to deal with everything properly. For example many such great leaders didn’t manage to eradicate poverty in their lifetimes, so even back then their successes had limitations.

A modern thatched house outside Lilongwe, Malawi.

Instead, our countries in Africa need leaders who understand the dynamics of the 21 Century; who ask questions such as:

what 20 practical things can we do to maximize the chances of the next WhatsApp being founded in our country?

The Africa of today needs young and dynamic leaders with vision who will pioneer projects for better connectivity, cheaper and affordable modern housing, attractive & inspired infrastructure, and well connected networks of affordable public transportation (modern trams, trains and road networks). Our countries in Africa need cheaper logistical costs for importation of desirable foreign goods, cheaper logistical costs for ease of export of the country’s processed goods without making them too expensive on international markets, State owned and run multi-billion dollar projects that will not only create thousands of jobs, but will bring forex – several of the kinds of things which we are now beginning to discover Tanzania was working towards. The list is rather long.

You can’t do that kind of thing effectively if you are still thinking of how to maintain a well-equipped secret police, or if your focus is just on winning the next election. You can’t do that if your parastatals and large public companies aren’t run by anyone under the age of 35, or when you don’t have enough women in leadership roles in such companies…

Birmingham City Library

It’s the difference between on one hand promising to build a stadium (whose long term impact on a poor country is debatable), and on the other hand working to build high quality modern libraries in each district and to bring free high speed internet to poor citizens and their children – most of whom can’t afford the often high data costs charged by private companies currently operating in African countries.

Continuing the spirit of Magafuli will require a fundamental shift in the way governance has been done in Africa for a long time. It will require true selflessness beyond party, tribal or national lines. It will mean breaking against party, regional and historic allegiances and doing what is best for everyone, not just the biggest or most powerful side. It will mean negotiating hard for the interests of the people, and not being intimidated by foreign powers or external pressure on matters of national or regional importance.

Magafulism has raised the bar extremely high for African leadership, and was well overdue. For now it remains to be seen just how many current African leaders will truly rise up to the challenge?

This is the main reason Malawi wants to be friends with Somaliland

by Sang N., posted in Africa, African, Diplomacy, Natural Resources, oil, Opinion, petroleum, Somaliland
Somaliland’s Parliament Building

If you were presented with a picture of the rather unassuming building of Somaliland’s Parliament for the very first time, you’d be forgiven for thinking that the place was in fact the site of Prakash Patel’s Tandoori Curry Bazaar in downtown Limbe.

Yes, looks are not everything, but the building is reminiscent of a glorified third-rate Bengali restaurant in a dusty part of town than the bonafide parliament building that it actually is. It looks more like one of those places where families go to after a sweaty day in Church, for Sunday dinner – complete with Biryanis, Chicken Kormas and Lamb Vindaloos.

So, what on earth is Malawi looking for in Somaliland?

Shouldn’t we instead be cosying up to the Singapores and South Koreas of this world? The glitzy success stories whose ‘breadcrumbs’ can catapult our tiny economy into the 21st century….no?

I mean, if we are serious about implementing a tried and tested formula of economic development which other countries have been using to develop their economies for decades then surely an official trip to New Delhi or Jakarta sounds more like it?

There’s been quite a bit of speculation as to the real reasons why Malawi is interested in Somaliland, and I won’t tire you by rehearsing those reasons here.

The adminstration of Somaliland has put out what to me sounds like regurgitated diplomat-speak.  A cut-and-paste statement that is too generic to be meaningful or taken seriously. The government of Malawi too hasn’t provided a convincing reason for its interest in Somaliland. In any case if the issue was truly about Somaliland seeking support from Malawi for it’s national recognition on the world stage, then surely it should have been officials from Somaliland visiting Malawi, and not the other way round. As the Chichewa proverb goes, phiri siliyendera nyani koma nyani ndi amene amayendera phiri (A mountain doesn’t follow the monkey, it’s the monkey that follows the mountain)

What’s surprised me from the commentary about the visit in Malawian publications is to see almost no one pick out the most probable reason why Eisenhower Mkaka (Malawi’s Foreign Minister) visited Hargeisa – the capital city of Somaliland, which I’m quite sure most Malawians hadn’t previously heard of before Mkaka’s visit.

I think the real reason Lazarus Chakwera’s government is looking to befriend Somaliland is to do with Oil. Yes, it’s all about Petroleum. Why this is the most likely reason is because in recent years, there’s been quite a lot of talk about investment into Somaliland. Only last year, the London headquartered Genel Energy announced it had increased his stake in the SL10B13 block in Somaliland to 100% , after acquiring a 25% state that had been previously held by East African Resources Group. That block alone is said to comprise several interests each containing at least 200 million barrels of crude oil, with some analysts estimating that there’s at least 1 Billion barrels of oil underneath that one block. That means Somaliland as a whole could have significant petroleum reserves, possibly of the size comparable to those found in several of the neighbouring countries.

And that’s a big deal.

Further, when friends are hard to come by as has been the experience of Somaliland (which is still regarded as an autonomous region within Somalia, and hasn’t been officially recognised by any country) any sort of trade can make a significant difference. As other marginalized states (including sanction-laden states such as Venezuela & Iran) will tell you, any takers of your output including oil in circumstances where other countries are afraid of the consequences of trading with you can be a lifesaver.

In addition, Somaliland in 2016 signed a 30 year contract with the United Arab Emirates’s DP World, the third largest port operator in the world, to manage and expand its Berbera Port. Last year, a US$400 million road project connecting Ethiopias border town of Togochale to Berbera was launched, a route which some analysts say will be an alternative transit point for imports and exports out of Ethiopia. There’s been several other significant and notable investments…

But if the oil quantities are as significant as some think, its only a matter of time before a refinery is constructed. Already in the south Ethiopia is looking at building it’s first oil refinery. This follows the shelving of a Blackstone Group LP-backed fuel pipeline project 2 years ago. Thus, given the frosty nature of diplomatic relations between Somalia and Ethiopia, it’s not inconceivable for Petroleum from Somaliland being refined in Ethiopia in the near future, before being sent back to be shipped from Berbera to destinations across the world.

Malawi needs oil at as cheap a price as can be found. Thus if you can sign contracts with ‘friends’ who are relatively new to the oil game to sell you oil at ‘friendly prices’ (as opposed to Market rates) in exchange for support regarding the friend’s sovereignty, then theoretically everyone stands to benefit. Malawi gets its relatively cheap oil at prices it can afford without having to deal with the baggage of the likes of Nigeria, Somaliland gets some Forex, and a measure of the international recognition it very much craves, there’s a boost to intra-African trade. Everyone’s a winner!

What does a Pro-Malawian Position on Foreign Direct Investment (FDI) into Malawi look like?

by Sang N., posted in Development, Investment, Lazarus Chakwera, Malawi, Natural Resources, Opinion, Public Policy, rural development
  • Listen to this article here

Last week President Chakwera took part in a webinar hosted by Invest Africa. (https://investafrica.com/event/malawi-insights-for-investors-with-his-excellency-lazarus-chakwera-president-of-the-republic-of-malawi/ ). It was a good decision that minimally should show that he is proactive in attracting Foreign Direct Investment (FDI) into Malawi. However, there are some painful lessons from the past that must be learned.

I think as far as Malawians are concerned, one of the main concerns is how the Tonse Alliances policies of President Lazarus Chakwera in regards to attracting Investors will translate into tangibles that will positively benefit and impact people’s lives.

Specifically, people will be interested to know how The Government of Malawi’s (GOM) policy on FDI will affect them in terms of employment, environmental protection and a stake in the national wealth creation, not only for the short term, but in the long –term.

Besides these concerns, Malawians will want to know what level of transparency will be established to safeguard against and prevent the corrupt practices of past administrations whereby influential party cadres illegally benefitted from contracts awarded to foreign companies via backhanders and by charging investors “access fees”.

This means that President Chakwera would be best advised to structure his policies on FDI to focus on Inclusive Prosperity for all Malawians, as has been his theme in many of his speeches, especially now that with the COVID-19 pandemic there sadly are many people who have been laid off work, and whose livelihoods have been disrupted and are uncertain.

Thus, the Tonse Alliance Government must publish its position on FDI, including deliverables and should enshrine into Law Investor Responsibilities towards the Malawian people, including how such will be monitored, and the penalties for failing to abide by such laws. This is important to give confidence to Malawians that the Tonse Alliance, unlike previous administrations is truly serious about creating shared prosperity for all Malawians.

Let us put an end to the days when an investor would come to Malawi, invest a couple of hundred thousand dollars, use low-pay Malawian labour, utilise Malawian roads, and our weak labour laws, to extract raw materials (including minerals), export those raw materials abroad, refine and add value to those exports, then sell them at a large profit to reap tens of millions of dollars from their investment – while the people of Malawi do not benefit proportionally.

I am not against investors making money, far from it. But in a poor country such as Malawi, with so much want and poverty around, the benefit to Investor versus the benefit to Malawi should be proportional and acceptable. It is not right for an investor to walk away from their investment extremely rich, but pay little or no taxes, and critically, leave behind impoverished communities that have not benefitted or been empowered beyond the token gestures (bad roads that soon disintegrate, mediocre school blocks built hurriedly with little thought, no decent hospitals, no decent services, poor infrastructure, no pension plans for former employees, no facilities for children of former employees, etc.).

Another reason why things must change is that unfortunately some investors in Malawi have left behind problems including polluted rivers / lakes/ grounds, deforestation, environmental degradation including soil erosion, sick former employees and suchlike. This is simply unacceptable in the 21st Century and should not be allowed to happen.  

A well thought through legal framework will reduce the likelihood of such omissions happening in the future.

There are some lessons from what countries like Tanzania, Rwanda and Botswana are doing, which Malawi can learn from. There are even lessons from China! For example, Rwandair is owned 51% by the government of Rwanda and 49% by Qatar Airways (See this).   Similarly, Airtel Tanzania is owned 49% by the Government of Tanzania.

These companies contribute millions of dollars to the state coffers of these countries.

So how much more are such resources required for a country such as Malawi, where ~ 70% of the population live in relative poverty? I propose that as much as FDI is desired, and as much as it is needed, the deals that are signed can no longer be about only appeasing the investor with disproportionate ownership stakes, while the people of Malawi who are supposed to own the resources are left with next to nothing. This can’t possibly be right.

You can try and justify investor ownerships stakes of 80%+ or 70%+ of industry in poor countries whichever way you like, but with the current global levels of inequality, such type of disproportionate ownership stakes just don’t cut it.

FDI under the Tonse Alliance Government of President Lazarus Chakwera should be about how to ensure the Malawian people are stakeholders who actually benefit from investments into Malawi. Enough with the rhetoric of the past, right now show us how investment will actually pull people out of poverty.

So Government of Malawi FDI policy should be about protecting the people from the exploitative and corrupt practices of some companies, which leave far too few long-term positive benefits or sustainability in the areas they invest in.

Of course protection of Investor Rights and strong pro-Investor Laws are necessary, even essential to ensure that the private sector flourishes. But there has to be a balance in that equally Strong Labour Laws that protect workers should be established, complemented by Strong Environmental Laws and strong Consumer Protection Laws to ensure that Malawians are treated with dignity, and that there is fairness; to ensure that each investor receives written obligations / responsibilities towards consumers/ people living in the areas which will be affected by the FDI.

It’s not a zero sum game, so both groups can benefit from the investment.

Such a policy position is also important for social cohesion. For example if you go to any township in Malawi today, and ask people what they think about certain companies, you’ll find that some companies (and the senior people who work there) are disliked by large sections of the populations in those areas because those companies are perceived as exploitative and not doing enough to empower the local man on the street. Yet such companies benefit from locals – who buy their goods, or provide cheap labour. Clearly this is not a desirable situation.

So while Malawi is open for business, when an Investor comes to invest, be it into a resource, or to extract a raw material, it should be the Government’s clear position that the company will be expected to establish a development fund, where 10% of the profits must be invested, to develop schools, to build decent housing, hospitals, roads, transportation links, to provide electricity, high speed internet, & to provide scholarships & loans to children in the area including children of employees and former employees. All this must be in black and white, enshrined in the contracts which are signed with each investor. Otherwise there is a real danger, based on past experiences, that verbal promises some investors make will amout to nothing.

What everyone needs to understand is that historically, most investors who come to Malawi walk away having made a lot of money. Our weak laws, poor bargaining, corrupt officials and poor implementation of measures designed to protect against exploitation are the reasons why we have failed to benefit proportionally from the profits that FDI has generated the last 25 years or so.

Thus, if you really want to develop the county, then the state can no longer be a mere passive observer in terms of ownership stakes and management of major industries. Malawi should have a greater stake in industry, so that, as a developing poor country, the proceeds from these interests can help catapult us forward economically.

This means deals of 51% GOM ownership (like Ethiopia and Kenya are now doing), and Botswana has done for a long time, whereby the investor holds no more than 49% of the stake in each major interest / industry / company,  should be standard.

That can still translate into profitable returns of millions of dollars for the Investors. But the difference is that GOM, and Malawians will benefit proportionally than has been the case in the past.

Mind you, these are Malawian resources we are talking about, for Malawians to benefit from. So 51% ownership by GOM by 49% ownership to Investors is quite generous. In my view that is how you create a win-win position.

There will be criticisms to such policies, as has happened in other countries. But such criticism is levied by people who :-

  • are thinking only about themselves
  • do not understand where our country is coming from (and the level of poverty/ want in our villages)
  • believe incorrectly that Africans should be subservient or otherwise in deferment to what Western Capital dictates – including unfair geopolitical neoliberal policy positions on resources, agricultural produce & raw materials.

What the Tonse Alliance Government should do is to communicate to any interested investor that while Malawi is open for business, essentially they will be dealing with a deprived man, who has been taken advantage of and abused for a very long time; who has few resources and who needs every penny from those resources to move forward, to rebuild his ruins and to feed his young.

That deprived man will only do business on his own terms. And with investors who care beyond just about making profits.

Ultimately, there’s always another fairer, more ethical, more responsible, more empathetic and more compassionate investor down the road …

One killed and many injured in land resettlement fracas involving Mota Engil

by Sang N., posted in Encounters, Justice, Natural Resources, Opinion, Public Policy, Thoughts

Barely a week after the Times run a story about Mota Engil’s proposed 5-star hotel in Monkey Bay in Mangochi, the newspaper has reported that a man has died and several others were injured on Tuesday in a fracas over the issue:

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Nyasa Times put the dead toll at two people. Malawi News 24 reported that nine people had been injured.

The dispute (also mentioned on the Times Facebook page here) concerns the resettlement of villagers from land (said to be in the region of 100 hectares) to make way for a the construction of the hotel and golf course. The villagers claim the government didn’t consult them when selling the land to Mota Engil, and that their rights have been breached. Further they claim that the chief, Nankumba, is corruptly implicated in the scheme.

Land grabbing and forced eviction disputes are common across Africa (see the following links: Brazil’s big landowners have far too much power | Who Owns the Land? Cameroon’s Large-Scale Land-Grabs | Tanzania evicting 40,000 people from homeland to make room for Dubai royal family – Salon.com | Villagers, the big losers as land is ‘grabbed’ for development | Ethiopia’s land grab nightmare of the Suri People ~ Horn Affairs), and usually they follow a similar pattern that pits the power of the government in concert with rich corporations against defenceless and voiceless communities.

A government will decide to commercialize a large chunk of land for a project, be it agricultural (e.g. a sugarcane plantation) or industrial in nature. They approach the villagers, but because there is very little incentive to adequately compensate them, or not enough effort to explain how the sale of the land will benefit the villagers, and because of the corruption involved, the villagers will refuse to be resettled. Thus after varying degrees of negotiations or coercion, the military, police and sometimes armed militia are recruited to forcibly remove the people. Bulldozers move in, buildings are demolished, sometimes burnt, those who resist are arrested and sometimes imprisoned, and very little is done to help the people whose land has been forcibly taken. Often the communities never get to receive any material benefit from the sale of their land. Talk of taking advantage of defenceless people.

But there are ways of doing things constructively. For example, looking at the floods that have recently devastated the southern part of Malawi, it makes sense to resettle most of the people from the areas that are most at risk of flooding; indefinitely, or until effective permanent solutions are found to the flooding problem in these areas. It’s in their best interest.

If I were in charge of a project of resettlement, the following is a rough outline of what I would insist to be done. To me it’s common sense, at least if the dignity of the people affected is to be preserved:-

(1) The government and land developer involved would need to identify suitable land for the villagers to be resettled to, and begin building decent accommodation (homes and flats) for them to live in. In order to utilise space efficiently, they would need to consider energy-efficient flats or even communal living spaces for those who opt for it. Although it would entail some cost, if you are taking land away from people, they need to be remunerated properly. And just because they are poor doesn’t mean that they must be ill-treated or taken advantage of.

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And it doesn’t have to be overly expensive. Bamboo roofed houses like the one below, made of treated bamboo, with solar water heaters, solar lamps could go some way in providing accommodation for a few years, before something permanent is built :-

bamboo-house(2) The government would need to develop employment options for the community, by bringing in some kind of work. A factory to make soap, to assemble bicycles, to produce eco-friendly building materials, or an integrated commercial agricultural interest would do. This is important to provide the working population amongst the villagers with jobs, and a means to earn a living, so as to reduce poverty and desperation.

employment(3) Similarly, an administration office, a police depot, some schools, a technical college to provide skills training would need to be built. A library, a market, a hospital, some shops, possibly even a small shopping mall with a Cinema, and other important infrastructure would also be necessary, to provide amusement and entertainment, and to cater to the new settlement.

Students-Africa(4) The roads and transport links from the new settlement to the nearest city would need to be updated, to enable seamless travel, and encourage transfer of skills to the area.

road(5) Communication:- The government would need to be transparent and invite the villagers to relocate to the new town. Each family would be provided with a home depending on the size of the family and its earning potential. The ownership of the house would be 50% owned by the government and the other 50% by each household. Further, depending on their earnings, they would be asked to contribute a small amount each month towards buying the house, although alternative arrangements would be found for those who are old and can’t work, and those who are poor and have no income source. A relocation stipend to each household would also be provided to help them start their new life.

(6) A promise to preserve grave sites and religious or sacred sites at their old settlements would be necessary. Further, within reason, the villagers would need to be allowed access to the religious and sacred areas.

(7) Finally, Ownership. A trust fund would be created to be administered by representatives of the villagers ( and not the chiefs) whereby at least 20% of the hotel and golf-course’s pre-tax profits would be invested in to help developing the community, including creatint employment, to be invested in education and healthcare, and to maintain the housing estates or build additional settlements. This must be fixed contractually for the present hotel operator, and any future operators. Why? Because that’s the true meaning of Corporate Social Responsibility.

Only then would it be equitable and right to hand over the vacated land to the hotel developer. These people have to ask the question, how they would want the government to handle the matter had it been them who were being asked to move, and leave their land behind? Any developer who doesn’t agree to a deal that includes such considerations definitely does not have the people’s interests to heart.

Zambia gov’t in talks with mining firms over sharing of mineral wealth – Xinhua | English.news.cn

by Sang N., posted in Initiatives, Natural Resources, Thoughts

http://news.xinhuanet.com/english/africa/2014-12/31/c_133890430.htm

Ok, so we’ll shut down the mine because of an 8% tax????!
Can you see how absurd that sounds? Are they saying that they make 8% in profit? The huge profits mining companies make (which BTW are wired out of the country) are not fairy distributed in the country that owns the resource,  yet they make it sound as if they are doing Zambians a favour??? The very definition of Greed… in other words,  we’ve got a contract,  our priority is to make as much profit,  we don’t care about the consequences of our tax evasion,  profit shifting or unfair contract terms on Zambia. If we can’t make the maximum possible profit, it’s not worth continuing the operation. 

Let the Canadian mining company leave. Let the Zambian government nationalise the mine, and take control of it. There are many educated people in Zambia,  they can manage. It will give them increased income and will help poor people in Zambia. Let them create a cooperative and provide employment to people who want to help African countries,  unlike wasting time with such leeches who only care for profit…
Also, I wonder whether they would have left if it were the government of Australia for example which increased the taxes. A part of me thinks it’s partly a bias towards African governments who are often bullied into accepting unfair contract terms, to the detriment of their people…

The Congo Still Ravaged by U.S.-Funded Conflict and Plunder

by Sang N., posted in Natural Resources, News, Opinion, Politics

The Congo Still Ravaged by U.S.-Funded Conflict and Plunder via Global Reasearch.ca

 

 …The Rwandan/Ugandan invasion has opened up the DRC’s wealth to unlimited plunder by Western mining companies, including Canada’s Banro Corporation. Canadian mining investment in the Congo is estimated to be as much as $3 billion. A 2002 UN report accused eight Canadian mining companies, including Banro, of “pillaging the Congo.” As reported in Le Monde Diplomatique, Banro and Barrick Gold (the biggest Canadian mining company) have been accused of “funding military operations in exchange for lucrative contracts” in the Congo….

….In addition to the millions of Congolese killed, the Western looting of the country’s resources has resulted in 400,000 women being raped, 2.6 million people being displaced, and 7,000 children being forced to become soldiers. Rape has been used on a horrifying scale as a weapon of war. According to Carol Mann, president of the NGO FEMAID, ….

After suspension of oil and gas exploration licences in Malawi what happens now?

by Sang N., posted in Corruption, Economy, Initiatives, Natural Resources, Opinion, Research, Thoughts

Anglo American Corporation was founded in Johannesburg in 1917 with £1 million (what today would have been £75 million, adjusting for inflation according to one inflation calculator).

AngloAmerican

It has since grown into a publicly traded behemoth with a market capitalisation of £31.2 billion and revenues of £29.3 billion (2013). It’s headquarters is now in London and the company is now known as Anglo American Plc, the fourth largest mining company in the world.

Although a net ‘loss’ of $961 million was declared in 2013, Anglo American is undoubtedly one of the big boys in the industry. To give you a scale of just how big they are, Anglo American Plc owns 85% of Luxembourg registered De Beers Investments, the holding company of De Beers, another prominent mining giant which is well-known in Southern Africa. But if that’s not convincing enough then how about this: Anglo American recently walked away from a gold interest worth $300 billion, after investing over $541 million it it. Apparently, the withdrawal is related to environmental risks, in particular the threat the Pebble Mine would pose to Alaskan Salmon (there’s even a campaign), although Anglo’s chief executive claimed the withdrawal was in fact a way of prioritizing “.. capital to projects with the highest value and lowest risks.”

Both Anglo American and De Beers have been criticised over their practices in Africa, including price-fixing, low wages (for Anglo American recently in Chile here) and lack of transparency. In particular, according to a Wikipedia entry:

In 1977, the company [Anglo American] demanded that the paper it owned, Rand Daily Mail, tone down its equal-rights support after exposing the murder of South African activist Steve Biko amid the subsequent government backlash. [words in parenthesis for clarity]

Further, a British charity, War on Want, published a report in August 2007 that accused Anglo American of profiting from the abuse of people in the developing countries in which the mining giant operates. According to War on Want:

“in the Philippines and South Africa, local communities threatened with Anglo American mines have faced severe repression in their fight to stay on their land, while in Ghana and Mali, local communities see little of the huge profits being made by AngloGold Ashanti but suffer from fear and intimidation and from the damaging impact of its mines on their environment, health and livelihoods”

In response, the company subsequently published a report defending itself and disclosing its finances.

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Malawi’s first president Dr Hastings Kamuzu Banda could have begun a state owned mining company in Malawi in the late 1960’s. He could have hired specialists from abroad, bought equipment from Britain or the US, begun prospecting for minerals, and by 1970 laid a foundation for a functional mining industry. The technology was available, and when Malawians had been travelling to South Africa in their thousands to work in the mines, labour would not have been a problem.

Banda didn’t begin a mining company. Instead he focussed on agriculture, which traditionally does not reap large profits as the sort which mining companies the likes of De Beers and Anglo American have been known to reap.

That decision could be a contributory factor further explaining Malawi’s economic woes today. While others were investing in assets and initiatives having huge long-term yields, Malawians were dabbling with agriculture and tobacco.

But to give him credit, while Dr Banda could have thought mining was not a priority to the newly independent country, he must have known that Malawi didn’t have enough capital resources to waste on ambitious projects whose very returns were unknown if not a gamble?

Further, having just broken away from the Federation of Rhodesia and Nyasaland, it’s understandable that while Britain could have been willing to extend Malawi a line of credit, as single-minded as Banda was known to have been, it’s inconceivable to think that he would have wanted to be constrained by such kind of favours from the very same people he so vehemently denounced. As he once declared: “We have no minerals. The soil is our gold mine”. In any case, what did a medical doctor who barely 10 years previously had been running a clinic in London know about the mining industry of the 1950’s and 60’s.

Having said this, would Dr Banda have started a state-owned mining company if he knew what treasures lay beneath the surface of Malawi’s geology? If he knew the value of such treasures on the international market?

Especially since there was information available as early as 1966 as to the Mineral deposits and mining potential of Malawi, according to a research paper titled MINERAL RESOURCES OF MALAWI AND MINING POTENTIAL by Rodney Mshali (The Society of Malawi Journal Vol. 62, No. 2 (2009), pp. 27-35 published by: Society of Malawi – Historical and Scientific ). Banda could have decided to take the risk if he wanted to.

Mineral Deposits

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Whichever way, it’s not my place to make a determination on Dr Banda’s judgement at this time.

But what does all this have to do with the current mining landscape in Malawi?

Well, as can be seen in the following links in Zambia, Chile, South Africa and Ethiopia , some mining companies have been known to be a menace to the countries they operate in. Issues of ownership, corruption, tax evasion in the form of profit shifting, low pay and poor working conditions, and of environmental degradation are often always lingering. In Malawi, recently, it has emerged that Paladin was considering to discharge ‘contaminated’ sludge kept in a dam near its Kayelekera mine into Malawi’s rivers systems for fear that if they did not do so, the rain season would cause their dam to overflow.

Thus, when news broke just under two weeks ago that the government of Malawi had suspended all oil and gas exploration licenses on Lake Malawi, so as to allow government to scrutinise and review each Licence that was issued or signed, I didn’t really know what to make of it. After all,  Malawi has had its fair share of sorry episodes of bad contracts married with irresponsible management, with the Paladin saga at Kayelekera. Although appearing diligent, uncovering any such lax agreements will just remind us all how deep in muck the country really is. It will not be a cause for celebration.

So then, what will the government do?

If they plan to review the oil exploration licenses in all good faith, and if necessary use legal mechanisms to resolve any indications of foul play -including unfair or prejudicial contract terms that do not benefit Malawians; if they plan to bring the miscreants to justice, then the suspension is a noble move.

In addition, the government of Malawi could work with charities [such as SHERPA (France), the Center for Trade Policy and Development (Zambia), the Berne Declaration (Switzerland), l’Entraide Missionnaire (Canada) and Mining Watch (Canada) ] which in 2011 filed complaints against mining companies Glencore International AG and First Quantum Minerals Ltd, to the Swiss and Canadian National Contact Points (NCP) for violating the OECD guidelines for multinational enterprises including for Tax avoidance in Zambia.

However, if the suspension of oil and gas exploration in Malawi is a veiled attempt at ‘rent-seeking’, as is rumoured to have taken place not only during Bingu Wa Mutharika’s regime, but also during the People’s Party administration, then it would be unfortunate because the government would have lost an opportunity to harness the resources that Malawi has. DPP would have lost a chance to show transparency.

One more thing; how can Peter Mutharika be sure that the value of assets or mineral resources declared by Oil companies interested in prospecting, or already prospecting is accurate, and not under-declared/under-valued ? For example, if the actual value (or near estimate) of viable crude oil deposits under the basin of Lake Malawi was US$400 billion, what is to stop the Oil companies holding the exploration licenses from misinforming the government that they had found only US$100 billion worth of confirmed deposits under the lake? Especially when the government was unable to verify those figures?

Wouldn’t an independent state-owned Mining company, that had its own equipment, and that owned a stake in each exploration site, and that was jointly involved in the exploration, so as to be able to verify the findings by its own independently undertaken mapping and surveying reduce such a risk?

Finally, it goes without saying that for them to be successful, any state-owned organisation (including parastatals) should be run and managed by people who by merit are fit to do so, and not by public appointees with little or no experience in the relevant technical field or area.

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Con Artists: Deception, deception and more deception

by Sang N., posted in Natural Resources, Opinion, Thoughts

The typical con artist of the 21st Century is a puppet organisation whose employees have important sounding job titles, wear suits, have well manicured fingernails and sport pricey haircuts. None of that amateurish I have a gun give me your money or I’ll blow out your brains twaddle.

This morning, I found myself reading a hilarious article that suggested that the World Bank (of all the neoliberal outfits out there) was fronting some initiative designed to help Africa in preventing pricing irregularities of its minerals, in the process saving the continent billions of dollars?

Yeah, essentially that’s what it says…which is… how do I put it….dishonest, or at least not entirely truthful, if one is to be mild-mannered.

Yes, it will be good for people to know the actual price of their country’s minerals, but who exactly are we talking about here. Aren’t the prices of commodities evident and freely available to the public on international markets? Aren’t the people working in Natural resource departments of government agencies somewhat a bit more savvy (and knowledgeable) than the local man on the street? All you need is a computer (or even a mobile phone) and an internet connection. Don’t tell me government ministries of natural resources across Africa don’t have access to an internet connection to enable them to check the price of Platinum or Rare Earth Minerals on the international market…or are too incompetent to do so?

Which is why I think this initiative is merely a distraction. Having a map of your country’s natural resources and the cost thereof doesn’t immediately translate into physical or tangible gains. It doesn’t mean that you, the native, controls, owns or has the real benefit of those natural resources. Or does it?

At the most this is a PR stunt designed to mislead, a nefarious ploy to distract the people’s attention from the unfair, unethical and illegal state of play, where African resources are owned and exploited by foreign corporations who have no interest whatsoever in improving the lives of African people. It’s purpose in my view is simply to provide an illusion that something is being done, when the fact remains that nothing of any real substance is being done. It’s as hollow as announcing to the world that the UN is considering a resolution against Switzerland and other Tax Havens, to stop them receiving illicit funds from third world / developing countries, and then doing absolutely nothing else other than that annoucement….no action, zero! Meaningless.

So, you can mineral map the whole world if you like, but the locals in third world countries will still remain deeply afflicted by poverty, often going without, or with very little; there will continue to be poor or non-existent healthcare facilities, hunger and disease will continue to run amok, corruption will remain high, wars will tear the landscape and displace millions … as in the backdrop, an alliance of tycoons and wealthy billionaires multiply their wealth – their catalyst, a resource that should be owned by Africans, and yet isn’t.

How many African companies have contracts to mine minerals in North America? How many have contracts for oil extraction in the North Sea, or off the coast of Australia? What percentage of Canadians own Multimillion dollar companies registered in Canada? Similarly, what Percentage of Nigerian/ South Africans / Malawians own multimillion dollar companies in their own countries? Those are the questions the World bank or indeed any serious commentator should be asking, because addressing the disproportionate imbalances or anomalies in those questions is what has a far higher potential to reverse capital flight from Africa and third world countries. That’s what has a higher chance of improving the plight of the people of Africa. Not mineral mapping…or some silly PR stunt.

It can never be right, whether you have a mineral map or not, no amount of sugar-coating or window dressing will ever put that unfair state of play right. The truth is there has been a clearly indisputable economic unfair advantage gained by western countries (helped by wars, bad policies and stupid African leaders), and something serious must be done to reverse and rebalance the playing field. Half-hearted deceptive stunts fronted by agents of the neoliberal right will only harm the little sincere good that others are currently working on.

If you really want to know what this is all about, the ending of the article itself says it all:

BDs2

 

The real reason why I oppose drilling for oil on lake Malawi

by Sang N., posted in Initiatives, Natural Resources, Opinion, Thoughts

Whatever you choose to believe, here is one hypothesis you must seriously consider; That a nation that does not own its natural resources is not independent at all. That instead, what exists are different levels of servants (anchito) working for a foreign master (bwana) under a semi-sovereignity.

After all the unnecessary toiling, studying, chasing one research project after another that has preoccupied my time the last two years, I have come to the sobering,inevitable and unsurprising conclusion that there is a worrying number of people who think you or someone like me doesn’t deserve much good out of this life.

A worrying number.

Some of these people think that if you are black and were born in Africa, in a country that is considered poor, in a family that does not have strong and powerful political allies, with little or no personal ‘fortune’ of your own, that your place on the socio-economic ladder is right there where fate (or an accident of evolution) created for you, exactly in the societal ‘bracket’ in which you were born. Where social / financial progression is an unattainable pie in the sky. In this place, a dead-end job is the best you can expect, and hand-me-downs or clothes sold in ASDA (or Walmart) with brands such as ‘George‘ and ‘White Stag‘ are worn. It’s a place devoid of vacations, where Sirloin steak is an unjustifiable luxury, and where a McDonald’s burger counts as a treat; where trips to the movies and broadway featured shows are unheard of, and golf – the preserve of the extremely wealthy. Lets just say it’s a place where a gym membership is not even a consideration when one’s salary can barely cover everyday expenses. In this place £7.50 spent on 400g cherries would be an obscene expense; it’s a place where a typical evening consist of dinner that costs less than $10 for a family of 5, (and does not include wine), and typical everyday entertainment is either Eastenders or some crap show on the radio, while drinking a bottle of Carlsberg.

These same people would have you believe that such a life is ‘normal’ or at least relatively normal. They bet on showing you a worse existential state to justify that while they exploit your resources (and make lucrative deals with your country’s selfish and spineless politicians), they are doing you a favour, you are in fact getting a better deal than that guy over there, in whose country a war has been raging for years, where women are unsafe and rape is commonplace, that guy’s country has virtually no education system in place, and look, armed guerilla fighters! In a country with no local currency, courts presided by warlords and a society infested with corruption….

Such scare stories are meant to somehow pacify your human (umunthu) and natural rage against what is clearly injustice against your brothers and sisters. Injustice which in other forms sees you called black monkey’s in your own country. They are the kinds of people who in Victorian times would have suggested (or mixed with people who were likely to suggest), without qualms, that a woman’s place is in the home; that women should not be allowed to work or vote. These are the kinds of people who would have owned the cotton mills (or mixed with people who owned the cotton mills) of Manchester and South Carolina, including being at the forefront of recruiting cheap child labour – for maximum profit. They are the kinds of people who would have been involved in the mistreatment of Jews throughout a large part of  European history. These kinds of people would have suggested to Pontius Pilate that because Jesus was a friend of the poor and ‘rejects’ of society, that he indeed deserved the most severe punishment for calling himself the son of God.

The haughty demagoguery of these sorts saw them perpetrate beliefs such as Manifest destiny, Supremacism and the Slave trade, and their puppets coin phrases such as ‘Axis of Evil‘ and ‘War on Terror‘. For the purposes of this article, not least dramatic effect, I’ll call these people the Greedy architects of death.

Yet aren’t these precisely the kind of attitudes which precipitate global unrest? Is this not what deprives humanity of peaceful coexistence and harmony? I say this because beneath the conflicts in Iraq, Afghanistan, Syria, Libya, Egypt, Ukraine, or even the economic troubles facing Zimbabwe, there is a simple altercation: that of land and resource control.

In the case of Zimbabwe, please reason with me for a moment. Why on earth should a country be punished with sanctions for wanting to take back land that was forcefully and deceptively taken away from it in the first place??? Don’t get me wrong, I’m not in support of violence, but what is it that lies at the heart of the matter?

Another facet to their characteristics is that of standing. Here, a common trait of the architect is opposition to any deal in which they aren’t getting a cut. In other words, when others do something bad, and these architects are not getting any money or resources from that bad something, then the action is wrong/unforgivable/ atrocious etc. But when the architects do that very same bad thing, they can can sugar coat it and self-righteously justify it…with phrases such as ‘Oil for food‘ and ‘Regeneration’, helpfully assisted by their Bretton Woods colleagues, with selective use of the biased chastisement whip commonly known as ‘International law’.

annan-3But how does all this relate to Malawi and the oil drilling on lake Malawi I hear you ask? Well, because at the heart of Malawi’s problems is land and resource control, and the puppet masters pulling the strings are exactly the same kinds of people brewing trouble elsewhere.

So, assuming you’ve heard of the Scotland independence debate, then even though I identify with old fashioned views that divorce must be avoided wherever possible and people must discuss to resolve differences, one part of me says that maybe Scotland should become independent from the UK. Because maybe then will they be able to use their resources for their own country’s benefit. Maybe if independence occurs, some of these architects will begin to realise just how their selfish and greedy actions have been hurting other people across the world?

In Europe maybe if Crimea joins the Russian Federation it will not be exploited by the pro-western kingpins of resource control – some of whom have probably been responsible for financial trickery or misconduct elsewhere?

Similarly, let the people of Malawi resist (at all costs and in whatever manner) drilling of oil on their beautiful lake because in the end, it’s not the local people who stand to benefit from the profits of the oil drilling. As the Paladin episode at Kayelekera has shown (and as other examples on the continent continue to demonstrate), it’s only a few corrupt government officials with off-shore bank accounts in tax havens in Switzerland or the British Virgin Islands who benefit. It’s large Investment Banks that provide the capital to the architects who will get the lions share, it’s a handful of millionaire tycoons with surnames like Borshoff and Ichikowitz, who live in mansions thousands of miles away and whose surnames the locals can’t even spell or pronounce properly, they are the ones who stand to profit. It is the Greedy architects of death (whose actions spur domino type effects, causing wars, and thereby suffering and hardship to millions across the world) who stand to benefit.

It sounds like a tedious link to make, but what has been the number one cause of unrest across the world if not battles for resource control?

That is my reason for opposing drilling on lake Malawi. Because while there is a high risk of environmental degradation which could affect the lives of fishermen who depend on the lake for their livelihoods (it happened in the gulf of Mexico, and happens in the Niger Delta all the times [see another link here via Amnesty International] – how can anybody sane think it will not happen on lake Malawi?), and which could negatively affect tourism and life ecosystems in and around the lake, in the end, there will be tears and loss as very few Malawians will benefit proportionally from the oil resource. In the end it could create strife….

But I’m not saying that the transactions a poor country such as Malawi signs with foreign ‘speculators’ are all bad or useless, and do not bring some material benefit to the country or its inhabitants. No, that’s not what I’m saying. What I’m saying is that comparatively, the benefit to Malawians is too small, too insignificant, chicken feed – unsustainable. In my view, it’s no more than a trojan horse that later comes back to bite and haunt the country. Instead, the net benefit of most of these deals is significantly in favour of these architects, who come into an area, pour in their capital, make billions of dollars in profits, then move out richer than they came in – leaving behind more than just a mess. Leaving behind broken lives,in which the local man remains economically where he was prior to the ‘invasion’, or even poorer, resigned to licking his wounds, as one aggressor after another wrestle for his country’s resources.

And that is hugely problematic because no matter who Malawians elect in May 2014 elections, if the status quo of dealing with investors is maintained, where African leader treat the national purse (and national assets) as private belongings, where investors are allowed to illicitly wire billions of untaxed funds out of the continent, if economic disparities across the country are not decisively addressed (in this I mean by creating companies in which trained locals are majority shareholders and investors are minority shareholders), if the leaders of western countries continue to be hypocritical over the well-documented conduct of business leaders from their countries, poverty levels will continue to linger in Malawi and across Africa for a very long time. And come next election very little would have changed, people will be scratching their heads, and you can come back and read this article again.

By the way, you don’t have to believe anything I’ve written above 🙂 . As I said in the first paragraph, it’s just a hypothesis, a theory based on my observations 🙂 … But even so, take a look at what these people here are saying (AfDB-GFI Joint Report: Illicit Financial Flows Render Africa a Net Creditor to the Rest of the World ;  Sub-Saharan Africa loses 5.7 percent of GDP to illicit financial outflows ; Illicit financial outflows from Africa crippling continent’s development – UN ). With such stories of behaviour which is clearly hurting Africa, should Malawians really risk another Kayelekera? Would it be wise to entrust the lake to people whose number one motivation is profit and little else? Could anybody say the country is really independent? How can you justify independence when you depend too much on the help of others for your existence?

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