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

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 WorldSub-Saharan Africa loses 5.7 percent of GDP to illicit financial outflowsIllicit 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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Global 100 Voices: No 6

My next guest is a good friend who I have known for just over 13 years now. He’s a Malawian businessman who currently is the manager of Phalombe Hardware in Limbe. Mr Ibrahim Nathanie, thank you very much for taking the time to do the 100 Voices interview.

IbrahimNathanie

farmers

  1. As a Malawian, how important is Malawi’s Socio-Economic stability to you and your family?

As a Malawian, Malawi’s socio economic stability is very important. I am a fourth generation Malawian and all my immediate family has been born and bred in Malawi. We have businesses running in Malawi that have recently struggled when dollars were scarce, fuel queues were rife and inflation was high. Things have now stabilised and as a result business is slowly improving. When things are not stable it directly affects how I can provide for my family.

2. After nearly 50 years since independence, what visible progress do you think Malawi has made since independence, and in your view, what pressing challenges remain? In view of those challenges, what do you think is the role of government and the people in tackling those challenges?

Since independence there has been progress in a few areas. For example we have now more graduates in various fields than we had then, more hospitals, more hotels. However, a lot of the progress mentioned has been donor funded.

Our pressing challenge is to try to reduce our dependence on being donor funded. One way this can be made possible is to take advantage of the natural beauty and fertile land we have in Malawi. Government has to improve infrastructure and provide incentives to the tourism industry. Improve airports, improve electricity generation.

ibs      3. As someone who lived(or has lived) outside Malawi for some time, and has been exposed to modern and progressive ideas, what symbols of development in the foreign country in which you lived have had the greatest impact on you, and why?

I studied in London, and a major symbol of development that had an impact on me was the transport facilities. As a student I could catch a bus or train and travel throughout London and not be dependent on anyone.

Another thing I thought was quite impressive was the NHS (Although I know the British people don’t think it is). Although, I have never had to use the service while I was studying; coming from Malawi I found it very impressive that anyone living in the UK has access to free hospital care.

    4.  What lessons do you think Malawians and the Malawian leadership can learn from those ideas?

Malawi and its leaders really need to look at ways to improve our transport sector. We need to improve our rail link and our airports. We need to break the monopoly South African Airways has on the Malawian market. For example if I wanted to fly Johannesburg from Blantyre it would cost me 450,000 MWK (~£859). If I wanted to fly from Johannesburg to London it would cost me the same. Surely government should realise that they need to open up the skies so that there is competition in aviation field and that potential tourists are not priced out of coming to Malawi.

5. When you last returned to Malawi, what struck you the most as the greatest sign of improvement or development since the last time you left?

When I returned to Malawi in 2006 , the greatest sign of improvement was the opening up of banks and businesses in rural trading areas such as Mangochi, Balaka, Dedza, Ntcheu, Mulanje, etc.

“For example how can employees at the National Food Reserve Agency fail to realise that a silo had a leak. If this happened in the UK the guy who was responsible would have resigned. “

    6. What struck you the most as the biggest sign of stagnation or regression?

The fact that I had to use a paper driving licence for a year as Road Traffic had run of cards to print them on. The fact that nobody in the government is being held accountable for wrongs being done. For example how can employees at the National Food Reserve Agency fail to realise that a silo had a leak. If this happened in the UK the guy who was responsible would have resigned.

7.  Malawians will be going to the polls in 2014, to elect a new president. In your view what kind of leader does Malawi NEED, considering the country’s current challenges? And specifically, how should that leader approach the top job in terms of creating sustainable development and foreign reducing aid dependency?

I find the work that Joyce Banda has done in the short time she has been president is commendable. There is now forex in Malawi, no shortage of goods and no fuel queues. My only criticism of her presidency is that she has not taken any active steps to reduce our dependency on foreign aid.

I would vote for Joyce Banda but would advise her to introduce incentives for investors to come and invest in Malawi. Provide incentives for our farmers to add value to their crop before exporting their crop. For example instead of Malawi importing cigarettes we should encourage cigarette companies to come and open manufacturing plants in Malawi.

factory

8.  As you know, Tobacco is Malawi’s biggest source of export revenue. Looking at the problems that have plagued the tobacco industry in recent times, what alternatives do you think Malawi has besides Tobacco, and why are they viable alternatives?

Tourism sector really needs to be exploited, you only have to look at how Zambia and Kenya are benefitting from exposing themselves to the rest of the world. We are blessed with beauty that is unmatched in the world; we however are not blessed with people in power who can see this.

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They need to build international airports at the lake, and domestic airports dotted along the lake shore. We need to attract tourists who actually spend money in Malawi not just back packers who are looking to get stoned on Malawi Gold (On a side note we could actually legalize the export of marijuana and rake in substantial forex). We need to reduce the cost of coming to Malawi. I gave an example earlier of how expensive it is for us to fly to Johannesburg.

9.   Considering our troubled history with donors and funders such as the IMF and World Bank, most recently when Bingu Wa Mutharika was president, how do you see Malawi progressing from this relationship in view of the criticisms these organisations have received in the media across the world?

To be honest I feel we have already progressed from this relationship. The donors are in love with the donors.

Without a doubt we have to reduce our dependence on the donors as we all know it’s a vicious cycle. It is not in their interest for Malawi to be self-sufficient; as if we were they could not enforce their views and western cultures upon us.

10. We now know that Malawi has some precious minerals, including Uranium, possibly oil and other natural resources. How do you think the present government is doing regarding managing Malawi’s natural resources?

The people in charge in my opinion have done nothing with regards to managing our resources. This is evident in that Paladin got a great deal from the government for our uranium???

The guys in charge have to look at how Zambia is doing with it copper resources, Ghana with its oil and even other European Countries with their natural resources such as Norway to realise we have got it horribly wrong.

11. In your view, can the government do better to manage natural resources? If so, how can it do better?

Yes. Government needs to follow Norway’s example. I have copied an article that I have read recently and feel this is EXACTLY what government needs to do with our resources, in order to manage it sustainably. This article below is copied from “http://www.theglobeandmail.com/report-on-business/economy/canada-competes/what-norway-did-with-its-oil-and-we-didnt/article11959362/

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“When oil was discovered in the Norwegian continental shelf in 1969, Norway was very aware of the finite nature of petroleum, and didn’t waste any time legislating policies to manage the new-found resource in a way that would give Norwegians long-term wealth, benefit their entire society and make them competitive beyond just a commodities exporter.
“Norway got the basics right quite early on,” says John Calvert, a political science professor at Simon Fraser University. “They understood what this was about and they put in place public policy that they have benefited so much from.”
This is in contrast to Canada’s free-market approach, he contends, where our government is discouraged from long-term public planning, in favour of allowing the market to determine the pace and scope of development.
“I would argue quite strongly that the Norwegians have done a much better job of managing their [petroleum] resource,” Prof. Calvert says.
While No. 15 on the World Economic Forum’s global competitiveness rankings, Norway is ranked third out of all countries on its macroeconomic environment (up from fourth last year), “driven by windfall oil revenues combined with prudent fiscal management,” according to the Forum.
Before oil was discovered, the Act of 21 June 1963 was already in place for managing the Norwegian continental shelf. This legislation has since been updated several times, most recently in 1996, now considered Norway’s Petroleum Act, which includes protection for fisheries, communities and the environment.
In 1972, the government founded the precursor of Statoil ASA, an integrated petroleum company. (In 2012, Statoil dividends from government shares was $2.4-billion). In the same year, the Norwegian Petroleum Directorate was also established, a government administrative body that has the objective of “creating the greatest possible values for society from the oil and gas activities by means of prudent resource management.”
In 1990, the precursor of the Government Pension Fund – Global (GPFG), a sovereign wealth fund, was established for surplus oil revenues. Today the GPFG is worth more than $700-billion.
While there’s no question that Norway has done well from its oil and gas, unlike many resource-based nations, Norway has invested its petro dollars in such a way as to create and sustain other industries where it is also globally competitive.
The second largest export of Norway is supplies for the petroleum industry, points out Ole Anders Lindseth, the director general of the Ministry of Petroleum and Energy in Norway.
“So the oil and gas activities have rendered more than just revenue for the benefit of the future generations, but has also rendered employment, workplaces and highly skilled industries,” Mr. Lindseth says.
Maximizing the resource is also very important.
Because the government is highly invested, (oil profits are taxed at 78 per cent, and in 2011 tax revenues were $36-billion), it is as interested as oil companies, which want to maximize their profits, in extracting the maximum amount of hydrocarbons from the reservoirs. This has inspired technological advances such as parallel drilling, Mr. Lindseth says.
“The extraction rate in Norway is around 50 per cent, which is extremely high in the world average,” he adds.
Norway has also managed to largely avoid so-called Dutch disease (a decline in other exports due to a strong currency) for two reasons, Mr. Lindseth says. The GPFG wealth fund is largely invested outside Norway by legislation, and the annual maximum withdrawal is 4 per cent. Through these two measures, Norway has avoided hyper-inflation, and has been able to sustain its traditional industries.
In Norway, there’s no industry more traditional than fishing.
“As far back as the 12th century they were already exporting stock fish to places in Europe,” explains Rashid Sumaila, director of the Fisheries Economics Research Unit at the University of British Columbia Fisheries Centre.
Prof. Sumaila spent seven years studying economics in Norway and uses game theory to study fish stocks and ecosystems. Fish don’t heed international borders and his research shows how co-operative behaviour is economically beneficial.
“Ninety per cent of the fish stocks that Norway depends on are shared with other countries. It’s a country that has more co-operation and collaboration with other countries than any other country I know,” Prof. Sumaila says.
“That’s [partly] why they still have their cod and we’ve lost ours,” he adds, pointing out that not only are quotas and illegal fishing heavily monitored, policy in Norway is based on scientific evidence and consideration for the sustainability of the ecosystem as a whole.
Prof. Sumaila cites the recent changes to Canada’s Fisheries Act, as a counter-example: “To protect the habitat, you have to show a direct link between the habitat, the fish and the economy,” he says, adding, “That’s the kind of weakening that the Norwegians don’t do.”
Svein Jentoft is a professor in the faculty of Bioscience, Fisheries and Economics at the University of Tromso. He adds that Norway’s co-operative management style, particularly domestically, has been key to the continued success of the fisheries.
“The management system [for fish stock] is an outcome of the positive, constructive and trustful relationship between the industry on the one hand and the government on the other hand,” Prof. Jentoft says. “They have been able to agree on issues that you and many other countries haven’t been able to, largely because the government has listened to the fishermen.”
However, Prof. Jentoft isn’t on board with all of his government’s policies. He’s concerned about how the quota and licensing system is concentrating wealth and the impact that this will have on fishing communities.
He predicts that Norway’s wild stocks will remain healthy in the foreseeable future and that the aquaculture industry (fish farms), where Norwegians are world leaders, will continue to grow.
In 2009, Norway’s total fish and seafood export was $7.1-billion, $3.8-billion was in aquaculture. By 2011, Norwegian aquaculture exports grew to $4.9-billion. In Canada, total fish and seafood exports in 2011 were $3.6-billion, with approximately one-third from aquaculture.
Norway’s forests are another important natural resource, and its pulp-and-paper industry has many parallels to Canada’s. Both nations are heavy exporters of newsprint. With much less demand since the wide adoption of the Internet and competition from modern mills from emerging markets, both nations have suffered through down-sizing and mill closures over the past decade. Both have been looking for ways to adapt.
The Borregaard pulp and paper mill in Sarpsborg has become one of the world’s most advanced biorefineries. From wood, it creates four main products: specialty cellulose, lignosuphonates, vanillin and ethanol, along with 200 GWh a year of bioenergy.
“You have a diversified portfolio of products,” explains Karin Oyaas, research manager at the Paper and Fibre Research Institute in Trondheim. “The Borregaard mill uses all parts of the wood and they have a variety of products, so if one of the products is priced low for a few years, then maybe some of the other products are priced high.”
She feels this is a key change in direction for the industry in Norway. She doesn’t want to see the industry putting all of its eggs in one basket, as it did with newsprint.
Dr. Oyaas also thinks that rebranding the industry is key to its survival and success in Norway. The forestry industry doesn’t get the same kind of attention as the oil industry, nor does it have the high-tech image. But it is just as high-tech, and it has the bonus of being a renewable resource.
“You can make anything from the forest. You can make the same products that you can make from oil,” explains Dr. Oyaas.”

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12. What is your answer to increasing transparency and eradicating corruption which is plaguing most governments across Africa?

Corruption is prevalent everywhere. It is just more prevalent in Africa. The reason being is that our civil servants e.g. the cops, the guy connecting your water or ESCOM metres are not paid well enough. We need to improve wages.

Consumers also need to change the way we operate. In order to get things “done” we feel we need to bribe. This enables people who do simple things like process your driver’s license or come to inspect your imported goods being offloaded not even being shy about asking for a bribe.

I reckon we need to start with these small steps and then look at the bigger bribes.

prprty

13. Any famous last words?

I manage Phalombe Hardware in Limbe – directly opposite Standard Bank in Limbe. At the moment investing in Malawi by building a house or commercial property is the way to go. We can provide all building materials from the foundation right up to the finishing stages for your house. Please visit us on face book or email us for a quote. Phalombe@africa-online.net

Global 100 Voices is a collection of reflections, views, opinions, ideas and thoughts by Malawians across the world, regarding the past, present and future of Malawi