An alternative asset for government bodies is investing in the infrastructure provided that the profile of risk and return is offered which is acceptable and profitable. Even there are alternative forms worked out for the risk supported externally.
However, reforming insurance companies, financial crisis, increased market uncertainty, crisis to sovereign debt affects the availability of capital required for infrastructure development even though worldwide long-term investments should be reformed. The point is there is a global infrastructure gap due to less capital available to fill it.
With such issues faced by the government bodies, we step into providing a holistic approach to their needs.
In developed and developing countries, global infrastructure requirements are high and also a key issue that government bodies keep on digging for a solution that is worthwhile as to fill the infrastructure gap quickly in order to develop and improve their country and economy. Different sources even provide the overall money needed for such projects to be carried out but the proper planning of the project cannot rely on only data. Public debt to GDP ratios was increased, a public sector not delivering good investment spending, public deficits, political interference’s being a cause for misallocations of resources had a combined effect on the reduced capital which was committed to investments in infrastructure.
With increasing public capital shortage, we encourage government bodies to come to us as we provide the whole package of such projects to be carried out. We believe that funding for infrastructure investment comes of benefit to everyone in every aspect also considering low re-deployable value, high intensity of capital.
Iseetrust – Iseetrade with their experts provides financial solution and bulk of financing for infrastructure playing a prominent role in offering consultation and analysis from start till it finishes.
With our help, what can government bodies really do? Well, all the large projects that aim for their profit and mainly development of their country which includes transportation and telecom infrastructure, hospitals, schools, prisons and social housing like social infrastructure, power generation, and transmission projects can easily be carried out.
Smart project finance techniques offered by our experts whilst involving in infrastructure funding as well. We play different roles and functions in such package when it comes to such projects not forgetting the main risk analysis and management of these risks as they are very important to be kept in mind.
The main problem in investment for infrastructure is risk analysis and risk mitigation.
At Iseetrust-Iseetrade we truly understand this and approaches infrastructure investing for the government bodies with a preliminary analysis of contractual structures.
Government bodies must seek creative solutions and creative financing for infrastructure projects so that they can pay and carry out the work they have planned for their public.
We deliver innovative ideas, consultation in building, operating, designing and also fulfilling our responsibility in maintaining assets carefully with our managerial qualities. Even though there is number of investors who provide such finance including banks and firms, however, in times of financial crisis they do back off and a project hanging in between is a total loss and something, not a government body would prefer. We keep on growing in this path and more interested in financing infrastructure projects every single day for your needs to be fulfilled.
What are the key benefits of working with us? Well, Iseetrust-Iseetrade
Is straightforward and we do not collect taxes that can be of additional costs to the government.
Is a way out even if the government bodies are squeezed with competition and budget? Compared to other funding sources, the funds we offer have a large potential in future as well.
Is a way out for providing you noteworthy future revenues in future that are guaranteed by us as only going with risks isn’t our thing and we don’t like to leave our clients disappointed. The plans are carried out with precaution since the beginning as to avoid later issues.
Iseetrust-Iseetrade understands and reaches out to government bodies to help them in providing solutions for the risks involved working as a backbone for their infrastructure funding as well as external and internal debt with their countries.
Don’t let lender fees catch you off guard.
Know exactly what fees will be due,
before underwriting takes place and at closing.
Some of the fees incurred are upfront fees which are due prior to the lender commencing underwriting. The total initial fees depend on the loan size, lender, type of guarantee and the project. These fees normally include out of pocket expenses that the lender will incur for legal, appraisal, underwriting, and due diligence for processing the loan request.
Fraud is rampant in the loan industry, as well evidenced by the “meltdown” in Commercial lending over the past several years. Iseetrust-Iseetrade also has its share of borrowers trying to get something for nothing or use our offers to defraud unsuspecting small borrowers.
Since you are here please do read the whole article and if you have a Megaproject needs funding to contact us, please do not use a middleman.
Whether it results from being an unsophisticated borrower or deliberate intent to defraud, there are many people wanting a lender to provide them with all the cash they are asking for, do no due diligence and believe that the borrower is totally honest and will make all the payments on time and pay the loan back when it is due.
“TANSTAAFL.” “There Ain’t No Such Thing As A Free Lunch.” In economic terms, this means everything has a cost, whether the cost is monetary, environmental, emotional, psychic, direct or indirect.
In private commercial lending, the individuals or entities doing the lending are private, that means they are not banks, commercial mortgage companies, or other bank-like institutions that are usually public companies and fall under a variety of federal lenders.
Private lenders are private. They can be privately held corporate pensions, privately held insurance companies, private equity funds, private individuals, or any variety of private trusts.
As such, they do not have loan officers. They do not solicit business directly from the general public. They rely on referrals and trusted relationships. They also do not have loan processors, underwriters, or other staff who help evaluate the merits of each loan request. They subcontract all these functions and pay for them out of pocket.
Whereas major banks may offer special deals for lending that are low fee loans, the commercial banks can and will charge the borrower a variety of fees, before closing.
These fees include: ORIGINATION FEES (1-6 points); ANNUAL fees (flat fee); VALUATION fees (appraisal); UNDERWRITING fees; DUE DILIGENCE fees; LEGAL fees; APPLICATION fees; PROCESSING fees; and ADMINISTRATION fees. Most Private lenders view these fees, paid before the loan closes, as a “test” of whether the borrower is serious.
In private commercial lending, the lender always requires a commitment fee of some sort, up front. This is usually done at the point where the lender has made an offer of rate and term to the borrower, and the borrower wants to accept the offer. These fees cover the costs of the formal offer and consequently the commitment on the part of the lender and are viewed as an indication of the borrower’s seriousness.
Iseetrust-Iseetrade receives many loan requests from the borrowers who not only waste their time by being unable to fulfill the requirements of the loan but are out to commit fraud against the funding source. We look at the up-front fee as a fraud prevention fee.
(Common fraud is after receiving a formal offer the client proceeds to borrow funds against the offer from many individuals and companies and walk away with the funds they collected from unsuspecting small investors) we have our stoppage for this type of fraud in place to protect the innocent.
As for the fees, once the client becomes known to us and we are convinced that they mean business we may significantly lower the fees to accommodate the needs of the client, thus making it easier to apply for a loan.
An example of how some commercial lenders charge fees:
“Interest Rates and Fees
Interest rates on commercial loans are generally higher than on residential loans. Also, commercial loans usually involve fees that add to the overall cost of the loan, including appraisal, legal, loan application, loan origination and/or survey fees. Some costs must be paid up front before the loan is approved (or rejected), while others apply annually. For example, a loan may have a one-time loan origination fee of 1%, due at the time of closing, and an annual fee of one-quarter of one percent (0.25%) until the loan is fully paid. A $1 million loan, for example, might require a 1% loan origination fee equal to $10,000 to be paid up front, with a 0.25% fee of $2,500 paid annually (in addition to interest).”
Above is an example for illustrative purposes.
Iseetrust-Iseetrade does not make personal or small loans please only get in touch for your megaprojects funding.
Hazine ve Maliye Bakanı Berat Albayrak, Fransa Finans Bakanı Bruno Le Maire ile Paris’teki görüşmesinin ardından Türkiye dönüşü uçakta bir grup gazetecinin sorularını yanıtladı. Bakan Albayrak, alışveriş merkezlerinde, evlerde dükkanlarda artık dövizle kiralama ve satış dönemine son vereceklerini açıkladı. Albayrak, buna yönelik çalışmalarının Meclis’e kısa sürede gelmesi için sürdürüklerini kaydetti.
Hazine ve Maliye Bakanı Berat Albayrak, Türkiye gibi güçlü ülkelerin dolarizasyon sorununu artık geride bırakması gerektiğini belirterek “Bu konuda şu anda çok yoğun bir çalışma başladı. AVM’lerdeki dükkanlarda, gayrimenkullerde döviz ile kiralama ve satışın önüne geçmek için gerekli adımları en kısa sürede atacağız. İşte burada hassas bir nokta var. Bir kısım kredi döviz riski bununla ilişkili olan portföyü ayıracak şekilde çalışıyoruz. Bunu en kısa sürede Meclis’e getireceğiz. Bu konuyla ilgili toplumda da zaten ciddi bir talep var. Detayları, hukuki süreçleri çalışılıyor şu an.” diye konuştu.
Bakan Albayrak, Fransa Finans Bakanı Bruno Le Maire ile Paris’teki görüşmesinin ardından Türkiye dönüşü uçakta bir grup gazetecinin sorularına yanıt verdi. Türkiye piyasalarının tatilde olduğu bayram boyunca uluslararası piyasaların açık olduğunu hatırlatan Albayrak, şöyle konuştu: “Herhangi operasyonel bir saldırı görmedik. Yaşadığımız süreçler bize çok farklı şeyler öğretiyor. Küresel sistemde her anlamda teyakkuzda olmamız lazım ülke olarak. Ekonomide artık bir açıklama ile bir tweet ile piyasalar hareketlenebiliyor. Ülkeler ile ilgili çok önemli hareketlenmeler meydana gelebiliyor. Ekonomide artık tüm kurumlar, piyasalar ile sürekli teyakkuzda olunması gereken bir döneme girdik. Reflekslerinizin güçlü olması gerekiyor.”
“FIRSAT OLARAK GÖRÜYORUZ”
Bakan Albayrak, bu yaşanan süreçlerin ülkeler açısından tehdit olduğu kadar fırsat da olduğuna dikkati çekerek “Ekonomik ve finansal sistemi yaşanabilecek dalgalanmalara karşı çok daha güçlü bir mimariyle inşa etmek durumundasınız. Bu süreçlerden çok farklı dersler çıkarıyoruz. Bu süreci, Türkiye ekonomisinin, finansal mimarisinin, sisteminin değişimi ve dönüşümü için, çok daha güçlü bir yapıya kavuşması için fırsat olarak görüyoruz”.
Türkiye’ye has bir durumdan ziyade küresel bir süreçle karşı karşıya olduğumuzu vurgulayan Albayrak, “Türkiye’nin hedef alındığı noktalar yok mu? Siyasi bir argüman üzerinden manipüle etme çalışması yok mu? Var. Biz de bütün paydaşlarla, aklıselim içerisinde iletişimimizi etkin kılarak bu süreçten daha güçlü bir şekilde çıkmak için gece-gündüz çalışıyoruz” diye konuştu.
Atılan adımların etkisinin sorulması üzerine “Elbette etkisi oluyor. Biz önümüzdeki dönemde ekonomik süreci daha farklı ve yeni adımları atarak yöneteceğiz. Her gün yeni bir adım. Yeni bir mimari inşa ediyoruz” diyen Albayrak, İstanbul finans merkezi olacaksak piyasaların geliştirilmesi, regüle edilmesi, denetlenmesi, takip edilmesi, monitör edilmesi, Türkiye’yi güçlü o mimariye taşıyacak yeni adımların atılması gerektiğini vurguladı.
“TÜRKİYE TRENİNE ATLAMAYAN, BU TRENİ KAÇIRAN KAYBEDECEK”
Dalgalanmaların ardından yaptıkları uluslarararası telekonferansa 6 bin 100 yatırımcının katıldığını hatırlatan Albayrak, “Bugüne kadar en yoğun katılımlı telekonferans 8 bin kişiyle Brexit sonrası İngiltere’ye yapıldı. Bu, bugüne kadar yapılmış en yoğun yatırımcıdan biri oldu. Siyasi saikle hareket eden yatırımcıların tamamı sonunda ekonomik olarak kaybedecek. Çok güçlü Orta Vadeli Planı ile, mali disipliniyle, yapısal dönüşümüyle, sanayi dönüşümüyle, katma değerli ürün üretim altyapısıyla, çok güçlü bir dönüşüm sürecine gidiyor. Türkiye’ye bu makul bakış açısıyla bakan yatırımcıların tamamı 2023 Türkiye’sine geldiğinde bu resimden çok daha kazançlı çıkacak. Türkiye trenine atlamayan, bu treni kaçıran kaybedecek” dedi.
“BUGÜN TÜRKİYE’YE, ERTESİ GÜN DİĞERİNE”
Küresel süreçte yaşanan gelişmeleri fırsat olarak değerlendirmeyi amaçladıklarına dikkat çeken Albayrak, “Eylülde görüşmelerimiz var. Dünyanın dört bir tarafıyla, Fransa’dan Almanya’ya, Rusya’dan Çin’e, Katar’dan İngiltere’ye kadar çok geniş yelpazede görüşmelerimizi sürdürüyoruz. Son yaşananlar şunu net bir şekilde ortaya koydu ki, dolar, küresel ve finansal sistemde artık güvenilir bir ticari enstrüman olmaktan çıkmıştır. Bugün Türkiye’ye böyle bir müdahale, yarın bana, ertesi gün diğerine. Şimdi siz güvenilir liman diye on yıllardır dünyaya pazarladığınız liberal, serbest piyasa, adil paylaşım, adil ticaret, güzel işbirlikleri için kullandığınız bir enstrümanı, bir para birimini siyasi saikle bir veya birden fazla farklı ülkeler veya farklı ekonomiler için cezalandırma aracına dönüştürüyorsunuz” dedi.
“TÜRKİYE’NİN REEL EKONOMİSİ ALTIN YUMURTLAYAN TAVUKTUR”
Bakan Albayrak, yaşanan dalgalanma sonucu özellikle bankacılık ve reel sektör ilişkisinde sektör bazlı incelediklerini, stres testleri yaptıklarını, BDDK ve bankalarla düzenli toplantılar düzenlediklerini belirterek “KOBİ’lerin, reel sektörün bu dalgalanmalardan minimum etkilenmesi için çok önemli adımlar attık. Önümüzdeki süreçte piyasa güvenini çok daha artıracak adımları sürdüreceğiz. Türkiye ekonomisi, üretimle büyüdü, firmalarımız ortada, ihracat rakamlarımız ortada, istihdam rakamlarımız ortada. Bankacılık sektörümüzün güçlü yapısından memnunuz, daha da güçlü olması lazım. Ancak bu tek başına bir anlam ifade etmiyor. Reel sektörde aynı oranda güçlü olduğu sürece bankacılık sektörü de kalitesini görecek. Türkiye’nin reel ekonomisi altın yumurtlayan tavuktur kimsenin kesmesine izin vermeyiz vermeyeceğiz. Zarar vermeye çalışanlar da karşısında ilk beni bulacaklar” dedi.
“ÖNEMLİ ADIMLAR HAYATA GEÇECEK”
Piyasadaki dalgalanmaya karşı alınan önlemleri hatırlatan Albayrak, yaşanan süreçler ne kadar güçlü yönetilirse, sektörlerin de süreçten o kadar güçlenerek çıkacağını kaydetti. Albayrak, “Türkiye’ye karşı topyekun bir saldırı olmasına rağmen ters tepki. Yaşanan süreç tamamen siyasi. Türkiye’nin ekonomik göstergelerinde, temel parametrelerinde bir değişim yok. Siyasi bir türbülans olduğu herkesin üzerinde mutabık kaldığı bir süreç. Bazı ülkelerle biz anlaşmalar imzaladık, bir kısmı devreye girecek. Katar’la ilgili bu hafta farklı girişler başladı. Hatta geçen hafta bir kısmı başladı. Bu süreç, ikili ilişkilerimiz açısından her iki tarafın da kazan-kazan şekilde çıkacağı işbirlikleri geliştireceğimiz bir süreç olarak görünüyor. Önümüzdeki dönemde, yıllar sonra değil, günler, haftalar, aylar içerisinde portföy ve kaynak çeşitliliğini daha da geliştireceğiz. Türkiye ekonomisinin daha sağlam ve güçlü bir şekilde bu süreçleri yönetmesi için önemli adımlar hayata geçecek” dedi.
“TÜRKİYE’NİN EKONOMİSİ İLGİLİ BÜYÜK BİR RİSK GÖRMÜYORUZ”
Bakan Albayrak, 2019 için en büyük riskin ne olduğu sorusuna verdiği yanıtta “Türkiye’nin ekonomisi ve finansal sistemiyle ilgili büyük bir risk görmüyoruz. Türkiye ekonomisinin yaşanabilecek küresel krizlerde bile etkilenmesini minimum kılacak üç önemli özelliği mevcut. Birincisi; Türkiye kamu borçluluğu, net borçluluk olarak bakıldığında dünyanın en düşük ülkelerinden bir tanesi, bu anlamda risk yok. İkincisi; hane halkı borçluluk oranı olarak yine dünyanın en düşük ülkelerinden bir tanesi ve risk taşımıyor. Üçüncüsü; finansal sektörü çok güçlü bir seviyede. Bütün bu sınamalara, bütün süreçlere rağmen sorunsuz olarak yoluna devam ediyor. Sermaye yeterliliği noktasında yüzde 16’larda, bakıyorsunuz AB limiti yüzde 8 ki birçoğu yüzde 5, 6, 7’lerde, buna rağmen 8 limitinin bile iki katı üzerinde, bu anlamda bile güçlü. Türkiye’de bu üç sac ayağının sağlam olduğu bir resimde bir risk görmüyoruz. Küresel süreçte yaşanan gelişmeleri fırsat olarak değerlendirmeyi amaçlıyoruz.”
“SERMAYE NOKTASINDA ÖNEMLİ HAREKETLİLİK YAŞANIYOR”
Bakan Albayrak, “Başta Katar olmak üzere uluslararası sermaye noktasında önemli hareketlilik yaşanıyor. Son dönemde bazı ülkelerle anlaşmalar imzaladık, bir kısmı devreye girecek. Katar’la ilgili bu hafta farklı girişler başladı. Hatta geçen hafta bir kısmı başladı. Bu süreç, ikili ilişkilerimiz açısından her iki tarafın da kazan-kazan şekilde çıkacağı işbirlikleri geliştireceğimiz bir süreç olarak görünüyor. Önümüzdeki dönemde, yıllar sonra değil, günler, haftalar, aylar içerisinde portföy ve kaynak çeşitliliğini daha da geliştireceğiz. Türkiye ekonomisinin daha sağlam ve güçlü bir şekilde bu süreçleri yönetmesi için önemli adımlar hayata geçecek” dedi.
“BENİM DÖNEMİNDE BİR DAHA VERGİ BARIŞI YOK”
Vergi barışında verilen süre dolduğunu kaydeden Albayrak, “Yapılandırmaya başvuran mükellef sayısı 5 milyon 484 bin 200 bin kişi oldu. Tahsil edilecek alacak tutarının toplamı ise 60.5 milyar TL. Benim Bakanlığım döneminde bir daha böyle bir vergi barışı olmayacak. Ben 1 yıl kalırım, 5 yıl kalırım bilmem benim döneminde bir daha vergi barışı yok. Ve biz daha yalın ve daha tabana yayılmış vergi sistemi için çalışıyoruz” dedi.
A new World Bank reports documents the continent’s impoverishment by rampant minerals, oil and gas extraction — but the bank enforces policies that feed it
A new World Bank report, The Changing Wealth of Nations 2018, documents Africa’s impoverishment by rampant minerals, oil and gas extraction. Yet the bank enforces the foreign loan repayments and trans-national corporate profit repatriation that sustain the looting.
Using “natural capital accounting”, the bank derives “adjusted net savings”, to better measure economic, ecological and educational wealth. This is preferable to “gross national income” (GNI), a minor variant of gross domestic product (GDP). GNI fails to consider depletion of non-renewable natural resources and pollution, not to mention unpaid women’s and community work.
The bank concludes that Sub-Saharan Africa loses about $100bn worth of adjusted net savings annually. It is “the only region with periods of negative levels — averaging negative 3% of GNI over the past decade — suggesting that its development policies are not yet sufficiently promoting sustainable economic growth … Clearly, natural resource depletion is one of the key drivers of negative adjusted net savings in the region.”
The bank asks, “How does Sub-Saharan Africa compare to other regions?” And answers, “Not favourably.” Contrary to the “Africa Rising” mythology, the adjusted net savings decline was worst here from 2001-09.
Attracting foreign direct investment in mining is counter-productive. The bank concedes, “Especially for resource-rich countries, the depletion of natural resources is often not compensated for by other investments. The warnings provided by negative adjusted net savings in many countries and in the region as a whole should not be ignored.”
But warnings such as the 2012 Gaborone Declaration by 10 African leaders are mainly ignored. There is a simple reason, related to power. “The adjusted net savings measure remains very important, especially in resource-rich countries. It helps in advocating for investments toward diversification,” the bank notes, “outside the resource sector.”
Africa desperately needs diversification from mining, but governments remain influenced by trans-national corporations intent on extraction. Even within the World Bank such bias is evident, as the case of Zambia shows.
Zambia’s missing copper
Last year, Zambia became a pilot study within the bank’s wealth accounting and valuation of ecosystem services project. Forests, wetlands, farmland and water resources were considered “priority accounts”. Conspicuously missing was copper, the main component of Zambia’s natural wealth.
Was copper neglected because such accounting would show a substantial net loss? A decade ago, one World Bank estimate of copper’s annual contribution to Zambia’s declining mineral wealth was 20% of GNI. Discussing such data might compel Zambians to rethink their economic strategy.
Bank staff work not in Zambians’ interests, but on behalf of other international banks and trans-national corporations. From 2002-08, Zambia’s president Levy Mwanawasa came under severe privatisation pressure from the World Bank so as to repay older loans, including those taken out by his corrupt predecessor, Frederick Chiluba. That debt should have been repudiated and cancelled.
When privatising Africa’s largest copper mine, Konkola, Mwanawasa should have received $400m for Zambia’s treasury. But the buyer, Vedanta CEO Anil Agarwal, bragged to a 2014 investment conference in Bangalore how he tricked Mwanawasa into accepting only $25m. “It’s been nine years and, since then, every year it is giving us a minimum of $500m to $1bn.”
Top-down or bottom-up?
From 1990-2015 many African countries suffered massive shrinkage in adjusted net savings, including Angola (68% of its wealth), the Republic of the Congo (49%) and Equatorial Guinea (39%).
There are two ways to address trans-national corporations’ capture of African mineral wealth: bottom-up through direct action to block extraction, or top-down through reforms. The latter is exemplified by the African Union’s 2009 alternative mining vision (AMV).
It proclaims, “Arguably the most important vehicle for building local capital are the foreign resource investors — trans-national corporations — who have the requisite capital, skills and expertise.”
South African activist Chris Rutledge opposed this neo-liberal logic in a 2017 ActionAid report titled, The AMV: Are we repackaging a colonial paradigm?
“By ramping up models of maximum extraction, the AMV once again stands in direct opposition to our own priorities to ensure resilient livelihoods and securing climate justice. And it does not address the structural causes of structural violence experienced by women, girls and affected communities,” it says.
Perhaps community-based opposition is more effective. According to the Bench Marks Foundation, in a pamphlet prepared for the civil society Alternative Mining Indaba (AMI) in Cape Town this week, “Intractable conflicts of interest prevail with ongoing interruptions to mining operations. Resistance to mining operations is steadily on the increase along with the associated conflict.”
The AMI’s challenge is to embrace community resistance, neither retreating into narrow NGO silos nor ignoring mining’s adverse impact on energy security, climate and resource depletion.
In 2015, when all new mines were valued at $80bn, Anglo American CEO Mark Cutifani conceded, “There’s something like $25bn worth of projects tied up or stopped” by critics.
Africa desperately needs diversification from mining, but governments remain influenced by trans-national corporations intent on extraction
Meanwhile, the World Bank still attracts intense protest. Women from Marikana’s slums, organised as Sikhala Sonke, remain disgusted by the bank’s $150m financing commitment to Lonmin. From 2007-12, the bank considered the company its “best case” for community investment — until the police massacre of 34 workers there during a wildcat strike. (World Bank president Jim Yong-kim even visited Johannesburg two weeks after that, but didn’t dare mention, much less visit, his mining stake.)
The bank’s other local operations included generous credits to the apartheid regime; relentless promotion of neo-liberal ideology after 1990; a corrupt $3.75bn Eskom loan in 2010 (the largest-ever World Bank project loan, which funds the world’s most polluting coal-fired power plant); and lead-shareholder investments in the Cash Paymaster Services-Net1 rip-offs of SA’s 11-million poorest citizens that receive social grants.
In spite of revelations about trans-national corporation exploitation in The Changing Wealth of Nations 2018, an increasingly schizophrenic World Bank is a sponsor of this week’s African Mining Indaba at Cape Town’s convention centre.
Each year, it’s the place to break bread and sip fine local wines (though perhaps not water in this climate-catastrophic city) with the world’s most aggressive mining bosses and allied African political elites, conferring jovially about how to amplify the looting.
• Bond teaches political economy at the Wits School of Governance. He is the author of Uneven Zimbabwe: A Study of Finance, Development and Underdevelopment, and co-author of Zimbabwe’s Plunge: Exhausted Nationalism, Neoliberalism and the Search for Social Justice.
Looting of Africa calls for action
A new World Bank report, The Changing Wealth of Nations 2018, documents Africa’s impoverishment by the rampant extraction of minerals, oil and gas. Yet the bank enables the repatriation of foreign loan repayments and transnational corporate profits that sustains the looting.
Using “natural capital accounting”, the bank calculates “adjusted net savings”, to better measure economic, ecological and educational wealth. This is preferred to “gross national income”, a minor variant of gross domestic product, which does not consider the depletion of nonrenewable natural resources and pollution, not to mention unpaid women’s and community work.
The bank concludes that sub-Saharan Africa loses about $100-billion worth of adjusted net savings annually. It is “the only region with periods of negative levels — averaging negative 3% of gross national income over the past decade — suggesting that its development policies are not yet sufficiently promoting sustainable economic growth … Clearly, natural resource depletion is one of the key drivers of negative adjusted net savings in the region.”
The bank asks: “How does sub-Saharan Africa compare to other regions? Not favourably.” Contrary to “Africa Rising” mythology, the adjusted net savings decline of the continent was at its worst from 2001 to 2009.
Attracting mining foreign direct investment is counterproductive. The bank concedes: “Especially for resource-rich countries, the depletion of natural resources is often not compensated for by other investments. The warnings provided by negative adjusted net savings in many countries and in the region as a whole should not be ignored.”
But warnings such as the 2012 Gaborone Declaration by 10 African leaders are mainly ignored. There is a simple reason; it’s related to power.
“The [adjusted net savings] measure remains very important, especially in resource-rich countries. It helps in advocating for investments toward diversification outside the resource sector,” the bank states.
Africa desperately needs diversification from mining but governments remain influenced by transnational corporates intent on extraction. Even within the bank, this bias is evident, as the case of Zambia shows.
Last year, Zambia became a pilot study in the bank’s Wealth Accounting and Valuation of Ecosystem Services project. Forests, wetlands, farmland and water resources were considered “priority accounts”. Conspicuously missing was copper, the main component of Zambia’s natural wealth.
Was copper neglected because taking it into account would show a substantial net loss? A decade ago, one bank estimate of copper’s annual contribution to Zambia’s declining mineral wealth was 20% of gross national income. Discussing such data might compel Zambians to rethink their economic strategy.
World Bank staff do not work in Zambians’ interests but on behalf of other international banks and transnational corporates. From 2002 to 2008, Zambian president Levy Mwanamasa came under severe pressure from the bank to privatise state assets to repay older loans, including those taken out by his corrupt predecessor, Frederick Chiluba. That debt should have been repudiated and cancelled.
When Africa’s largest copper mine, Konkola, was privatised, Zambia’s treasury should have received $400-million. But the buyer, Vedanta chief executive Anil Agarwal, bragged to a 2014 investment conference in Bangalore about how he had tricked Mwanawasa into accepting only $25-million. “It has been nine years and since then every year it is giving us a minimum of $500-million to $1-billion,” he boasted.
Stop the looting
From 1990 to 2015, the adjusted net saving of African countries shrank, including Angola’s (68% of its wealth), the Republic of the Congo’s (49%) and Equatorial Guinea’s (39%).
There are two ways to address transnational corporates’ capture of African mineral wealth: bottom-up direct action or top-down reforms to block extraction.
The latter is exemplified by the African Union’s 2009 Alternative Mining Vision (AMV). It proclaims: “Arguably the most important vehicle for building local capital are the foreign resource investors — transnational corporates — who have the requisite capital, skills and expertise.”
South African activist Chris Rutledge opposed this neoliberal logic in a 2017 ActionAid report, The AMV: Are We Repackaging a Colonial Paradigm?
“By ramping up models of maximum extraction, the Alternative Mining Vision once again stands in direct opposition to our own priorities to ensure resilient livelihoods and securing climate justice. And it does not address the structural causes of structural violence experienced by women, girls and affected communities,” Rutledge said.
Perhaps community-based opposition would be more effective. According to the Bench Marks Foundation, in a pamphlet prepared for the civil society Alternative Mining Indaba held in Cape Town this week, “intractable conflicts of interest prevail with ongoing interruptions to mining operations. Resistance to mining operations is steadily on the increase along with the associated conflict.”
The Alternative Indaba’s challenge is to embrace community resistance, and not to retreat into narrow nongovernmental silos or by ignoring mining’s adverse effect on energy security, climate change and resource depletion. In 2015, when all new mines in South Africa were valued at $80-billion, Anglo American chief executive Mark Cutifani conceded: “There’s something like $25-billion worth of projects tied up or stopped [by critics].”
Meanwhile, the World Bank still attracts intense protest. Women from Marikana’s slums organised as Sikhala Sonke remain disgusted by the bank’s $150-million financing commitment to Lonmin. From 2007 to 2012, the bank considered the firm its “best case” for community investment — until the police massacre of 34 workers there during a wildcat strike.
(Bank president Jim Yong Kim even visited Johannesburg two weeks after that but didn’t dare mention it, much less visit his mining stake.)
The bank’s other local operations included generous credits to the apartheid regime, relentless promotion of neoliberal ideology after 1990, a corrupt $3.75-billion Eskom loan in 2010 (the largest-ever World Bank project loan, which funds the world’s most polluting coal-fired power plant) and lead shareholder investments in Cash Paymaster Services, whose Net1 has ripped off South Africa’s 11-million poorest citizens who receive social grants.
In spite of the bank’s revelations about the exploitation by transnational corporates in its recent report, an increasingly schizophrenic World Bank is a sponsor of this week’s African Mining Indaba at Cape Town’s convention centre. Each year, it’s the place to break bread and sip fine local wines (though perhaps not water in the climate-catastrophic city) with the world’s most aggressive mining bosses and allied African political elites, conferring jovially about how to amplify the looting.
link to original article: https://mg.co.za/article/2018-02-09-00-looting-of-africa-calls-for-action
Professor Patrick Bond teaches political economy at the University of the Witwatersrand’s School of Governance
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