The Wrong Kind of History PDF Print E-mail
Andy Rowell, 4 July 2005

Was history made this weekend? Did we witness the beginning of the end of global poverty? Billions of people hope so, but their fate lies in the palms of just eight men. The leaders of the G8, the most powerful men on the planet, meet this week at Gleneagles in Scotland. To persuade these men to act, hundreds of thousands of protestors have flocked to the Scottish city of Edinburgh to make their voices heard. They have come bearing banners, and wearing white wrist bands – the symbol of the “Make Poverty History” campaign, a coalition of some 400 development agencies, campaign, faith groups, and trade unions. 

So will poverty become history? Of course not. In the run up to the Summit, it was announced that a $55 billion settlement had been reached to cancel some of the debt owed by the poorest 30 countries. It was a deal that was heralded as a “victory for millions”.  Not everyone is impressed though. Award-winning investigative journalist, John Pilger has called the G8 a “fraud and a circus”.

“In summit after summit” writes Pilger “not a single significant ‘promise’ of the G8 has been kept, and the ‘victory for millions’ is no different. It is a fraud - actually a setback to reducing poverty in Africa”. Pilger claims the $55 billion is equal to at most $1 billion spread over 18 countries.

He says that this amount will be halved, providing less than six days' worth of debt payments, “because Blair and Brown want the IMF to pay its share of the ‘relief’ by revaluing its vast stock of gold. The first unmentionable is that the gold was plundered originally from Africa. The second unmentionable is that debt payments are due to rise sharply from next year, more than doubling by 2015. This will mean not ‘victory for millions’, but death for millions”.

The devil is always in the detail. It is worth examining the exact words of the G8 Finance Ministers when they made the supposed historic debt deal: “It is essential,” they said “that developing countries put in place the policies for economic growth”. It was important for them to “boost private sector development” by attracting investment and eliminating “impediments to private investment, both domestic and foreign”.

This means that in return for cancelling debt, the finance ministers want a free reign to invest in the continent. What would their primary investment be in Africa? Oil and gas. Where would this be? Primarily in West Africa, especially Nigeria. The G8 Finance Ministers call Nigeria the “key” to prosperity for the whole of Africa.  Nigeria just also happens to be a key country for energy diversity for the G8 countries. So the deal is this: you give us oil and gas, we give you debt relief.

There is a business summit being held in Britain to coincide with the G8. But it is taking place in London, not Scotland. It is called the G8’s “Business Action for Africa Summit”. Tony Blair has sent a welcoming message to the assembled businessmen and politicians including Nigeria’s President Olusegun Obasanjo.
 
A quick look at the speakers’ list will give you an understanding of the kind of business Blair wants to blossom in Africa. The forum chair is Sir Mark Moody Stuart of Anglo American PLC, one of the world’s largest mining companies, with interests in gold, platinum and diamonds. Moody Stewart is the ex-chairman of Shell, the oil company. He was a senior Shell executive when the company colluded with the Nigerian military to silence their critics in the Niger Delta. The current chairman of Shell, Jeroen Van Der Veer, is there too, as is the chairman of BAT, the world’s largest tobacco company.  

Business Action for Africa says they too are committed to ending poverty in Africa. They say they are determined to root out corruption. They say they are committed to developing good business practice and committed to “good social and environmental conduct”.  Yet, the idea that BAT, whose products are implicated in 750,000 deaths every year, is committed to good business practice or sustainability is just laughable.  

It is not just people who smoke who get sick; tobacco farmers in Africa get sick too. There is green tobacco sickness, a type of nicotine poisoning caused by the absorption of nicotine through the skin. Symptoms include nausea, vomiting, weakness, headache, dizziness, abdominal cramps and difficulty in breathing. The sickness is more likely to happen when workers do not wear protective clothing, as is common in countries such as Uganda, Kenya and Nigeria. In Kenya, farmers routinely use organo-phosphate pesticides that have been linked to neurological damage.

One such Kenyan tobacco farmer was interviewed by the development charity Christian Aid: “During spraying we have problems with the chest and when we harvest we get skin irritations, especially on the arms”, he told them. “When we ask for protective gear, they [BAT] say they will bring it and then time goes by”.

Equally the concept of being able to mine Africa’s resources and drill its oil in a sustainable way is a contradiction in terms. Both Europe and America are increasingly eyeing up Africa’s vast oil and gas reserves, eager to find reserves that are away from the volatile Middle East. In a post-September 11th world, the Middle East has become a reoccurring nightmare for America, a fact made worse by the mess in Iraq.

For America the nightmare has just got worse, with the election of Iran’s new hard-line President, Mahmoud Ahmadinejad, who has said that his country has “no significant need” for ties with the United States. Ahmadinejad’s heavily defeated opponent, Akbar Hashemi Rafsanjani, had made improved relations with America a central pillar of his election campaign . The campaign backfired badly, much to Washington’s and London’s dismay.

So with Iranian-US relations in the “deep freeze”, Iraq’s continuing quagmire and the ever present threat of trouble in Saudi Arabia, the US needs vast quantities of oil and gas to feed its ever thirsty gas-guzzling lifestyle. Africa, especially West Africa, fits the bill for them. Nigeria is their key to energy security.

But what is good for the United States and Europe, is not necessary good for the people of Africa or the people of Nigeria. It is not going to lift them out of poverty. Just look at Nigeria, where despite its oil wealth, some £220 billion has been looted by its leaders, who were able to borrow heavily against future oil revenues.

Whilst “Business Action for Africa” advocates increased oil and gas production as a way out of poverty, the reverse will happen. A new report was published last week by the group OilChange International, along with the Jubilee Debt Campaign and IPPR, the UK's leading progressive think tank. It was called “Drilling into Debt”

The report examined data from 161 countries. Its conclusion was alarming. “It was often thought that whatever other curses oil brought, its vast revenues offered a path out of debt for oil exporting countries, and thus perhaps, eventually out of poverty.  But the notion that oil production alleviates debt proves false – in fact, quite the reverse is true.” The more oil a country produces, the more debt it tends to generate. The more dependent on oil exports a country is, the deeper in debt it tends to be.

The report argues that if Nigeria increases its oil production from its current level of 2.5 million barrels per day to a projected 4 million barrels per day by 2010, the country’s external debt will grow by 69% or US$21 billion over that time period. It will push the country deeper into debt. Its people deeper into poverty.

Bush and Blair’s plan for Africa relies on increased oil production. It will result in everything the G8 say they are against. “The G8 development agenda is totally undercut by their energy strategy” argues Steve Kretzmann, the report’s co-author. “Forgiving Africa's debt while promoting more investment in African oil will only ensure further debt and poverty for Africans, and climate change for us all”.

 

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