FPW
Washington, DC - Protests of the Keystone XL Pipeline over the past two years have sent a clear message to the U.S. Government – a message that Congress persistently ignored as pro-pipeline legislation progressed toward the White House this week. By voting for the Pipeline, Congress is creating a volatile business environment for extractive companies, which ultimately has and will cause profit loss for corporations like TransCanada. Indeed, TransCanada Corporation has already increased estimated capital investments for the Pipeline by $2.5 billion since 2008 due to “lengthy delays”, many of which were caused by community protests and opposition from environmental groups. A recent study by First Peoples Worldwide found that governments that ignore public concerns over resource extraction (the U.S. not excluded) foster community opposition and protests, which in turn increase site closures, production costs, and damaged reputations. The Keystone XL Pipeline is a lose-lose for communities, corporations, and the U.S. government.
Arguments for the Keystone XL Pipeline claim that it will create jobs, increase domestic oil supply and lower gas prices. President Obama’s biggest argument against the Pipeline is the opposite: “Understand what this project is: It is providing the ability of Canada to pump their oil, send it through our land down to the Gulf where it will be sold everywhere else. It doesn’t have an impact on U.S. gas prices.”
However, congressional approval for the Pipeline is a moot point as long asTransCanada Corporation lacks a social license to operate, or the acceptance of the project by local communities and affected stakeholders. Without a social license, TransCanada Corporation faces a future of continued protests, site closures, and diminished shareholder ratings – ultimately amounting to profit loss. Ernst and Young rate the “social license to operate” as one of the top three business risks to the extractive industry sector, citing that “the frequency and number of projects being delayed or stopped due to community and environmental activists continues to rise.”
What’s more, the recently published Indigenous Rights Risk Report shows that extractive companies could care less about the communities their projects affect - only 6% of publicly-held US oil, gas and mining companies utilize adequate risk management tools when working with communities. Moreover, only 8% of extractive companies implement any policy that remotely addresses community relations or human rights. At this rate, TransCanada has two options: either expect profit loss due to community opposition, or adjust their community engagement policies.
As long as protests continue, a social license to operate won’t materialize – and there is no end in sight for community opposition to this project. Recently, the Sioux tribe of South Dakota vowed to close their reservation’s borders, through which the Pipeline is set to run, if construction is approved. Right before the Senate vote on November 18, environmental activists installed aninflatable pipeline in Senator Mary Landrieu’s yard, one of the most outspoken proponents for the Pipeline. The First Nations-led Idle No More movement in Canada has been protesting the Pipeline north of the border for nearly two years. Those that would be directly affected by construction of the Keystone XL Pipeline, including landowners and ranchers, are some of its strongest opponents – and the most systematically ignored by both Congress and TransCanada.
TransCanada severely underestimated social costs on the front end of the project, taking a reactive rather than proactive approach to community opposition – which has resulted in a $2.5 billion dollar loss before the project has even started.
At the same time, Congress’ pro-Pipeline votes have been little help - governments that ignore public concerns over resource extraction and suppress democratic systems for participation in resource decisions create a dead-end for extractive companies, whether operating in Canada, Nigeria, or the United States. Bad governance is bad for business – governments and corporations alike must start respecting communities and their right to Free, Prior, and Informed Consent (FPIC) when working with extractive industries.
13 Feb 2015
Peru: Bids for Oil Extraction to Bring Trouble in Amazon
The state of Peru is in the process of launching the bidding process for the largest oil concession in the country, Lot 192, which expires this year, while affected Indigenous communities are still waiting for their demands to clean up contaminated areas from the previous 44 years of exploitation.
2015 will be a fundamental year for the future of Lot 192, located in Amazonian region of Loreto, Peru. Since the area was first ceded to oil companies in 1971, environmental contamination from oil spills has plagued the watersheds of four tributary rivers to the Amazon, the Tigre, Corrientes, Pastaza, and Marañon rivers. The current concession, owned by Argentinian company Plusptrol Norte, expires in August of 2015. To continue extraction, the company is required to renew their concession, but first must complete a series of requirements.
The first is a Prior Consultation, which requires the government consult with the traditional leaders who form the Indigenous federations of the four watersheds, including the Quechua Federation of the Upper Pastaza River, or FEDIQUEP, by its Spanish acronym.
But before they will engage in a consultation for an extended concession on their lands, the federations have demanded that the state of Peru must clean up the contamination that has accumulated from disastrous environmental practices over the past four decades. Their demands include remediation, land titling, and compensation for the use and damages to their lands. During roundtable negotiations last year, the government committed to respecting these demands, and signed an agreement between the State-owned oil company Petroperu and Indigenous communities to clean up heavily polluted land and water.
Pluspetrol president Luis Ortigas has urged the Energy and Mines Commission of Peruvian congress to accelerate the process to submit bids for the license for Lote 192, but have admitted that very little time is left to comply with the Prior Consultation. His suggestion, with a flip of logic, is to hold the prior consultation in parallel with the bidding process, arguing that both can be achieved within six months and allow for the permit to be renewed to Plusptrol by August 2015 or given to another company.
Talk has also surfaced that perhaps Peru’s state controlled oil company, Petroperú, will take over the concession of Lot 192, which covers 287 thousand hectares and produces 12,242 barrels of petroleum daily, making it the highest producing oil concession in the country.
Regardless, there has been no clear demonstration of good faith from the government to act on the demands of the affected communities. “The government has made promises. If they willingly mislead the Indigenous federations in the negotiations, they will have to assume the responsibility,” warned Jorge Tacuri, consultant to FEDIQUEP.
After the news broke that a bidding process would begin, FEDIQUEP president Apu Aurelio Chino Dahua urged Peru President Ollanta Humala to respect the process of the Prior Consultation. “In Lot 192 consultation needs to happen. We will not be ridiculed.”
The federations’ advocacy platform, PUINAMUDT, stated, “Before any bidding process for Lot 192, the Indigenous federations of the four watersheds have demanded that their rights be respected, and that the State grantees a minimum standard of attention, including environmental remediation, compensation for territories, among others.
UN Human Rights experts issued a warning in December during the Lima COP20 talks, saying, ”While the world looks on to Paris following the conclusion of the Lima Conference of Parties of the UN Framework Convention on Climate Change, the Peruvian Government needs to do more to protect their own citizens from environmental harm and prevent the recurrence of environmental emergencies affecting indigenous peoples, including the Quechuas, Kichwas, Kukamas and Urarinas,” the new UN Special Rapporteur on the rights of indigenous peoples, Victoria Tauli Corpuz, said,according to a press release.
“Peru must adopt measures to ensure remedy to such situations and to protect and respect the rights of indigenous peoples to their land, territories and resources and to consultation towards obtaining their free, prior and informed consent,” Ms. Tauli Corpuz stressed, in line with comments made by previous rapporteur Professor James Anaya.
Environmental and Health emergencies were been declared in the region in 2013 and 2014 respectively. “Companies extracting oil in this region have left behind a toxic mess with disregard for the rights of affected communities and laws of Peru,” related the UN Special Rapporteur for human rights and hazardous substances, Baskut Tuncak.
“Peru has obligations to clean up the toxic oil spilled to protect the rights of people in the region, and to hold the companies accountable for their failure to respect human rights, before re-licensing the land and making an awful situation worse,” he continued.
Indigenous Youth Speak on the White House Initiative on American Indians and Alaska Natives in Education
Hauʻolihiwahiwa Moniz
In early November, I was lucky enough to be asked to testify at a White House Initiative on American Indians and Alaska Natives in Education at Russell Sage College in Troy, New York where I attend as a sophomore. The initiative, created by President Obama to offer a platform in which Indigenous youth in America could speak on their experiences in the American educational system, is one of the first of its kind. The men and women of the initiative visited many different states across the continental US, hearing from many different native students on their experiences and as a Native Hawaiian, I was lucky enough to be one of those voices.
As a Native Hawaiian I have many concerns regarding Indigenous people in education. My people and I struggle alongside other Indigenous peoples and minorities in this and many more aspects in life.
In 1981, Congress instructed the Office of Education to submit a comprehensive report on Native Hawaiian education. The report, entitled the ‘Native Hawaiian Educational Assessment Project', was released in 1983 and found that Native Hawaiians scored below the national average with regards to national norms on standardized achievement tests, they were disproportionately represented in many negative social and physical statistics and had educational needs that were related to our unique cultural situation, such as different learning styles and low self-image (www2.ed.gov). While these statistics were taken many years ago, more recent statistics have not show much change these findings.
As an example, Native Hawaiian students currently rank among the lowest group of students nationally in reading. However, in the 19th Century Native Hawaiians had the highest adult literacy rate of any peoples in the entire world, including western societies at an impressive 90% of adults in the isles (ahapunanaleo.org, cechambers.com, archives.starbulletin.com). It seemed quite blatant to me, in my research of my people, that this current ranking of Native Hawaiians is very much so in conflict with our traditional abilities.
My people are not stupid, we are not lazy, we are not incapable. And yet, why doesn’t the statistics reflect this? There are many reasons for this: poverty, substance abuse and a chronic trivialization and degradation of our native traditions, culture, and language (much of these reasons symptomatic of the illegal overthrow of our kingdom). While the illegality of the overthrow is not up for debate as the illicit nature of the overthrow and in turn annexation of Hawaiʻi was recognized and admitted to by former President Bill Clinton while he was in office, nothing much came of this. While The Apology Resolution of 1993 may be hailed as significant by some, however it was ultimately irrelevant and useless in affecting any real change. The illegal overthrow of the Hawaiian Kingdom did not only rob Native Hawaiians of their sovereignty and their kingdom, but it robbed the sovereignty and kingdom of many other ethnic groups who claimed citizenship in Hawaiʻi. Citizens of all ethnic backgrounds mourned the loss of their beloved Kingdom at the hands of the United States, but it should not be forgotten that it is Native Hawaiians who lost the most.
Hawaiians are displaced and disconnected from the land. According to statistics, 37% of the homeless population in Hawaiʻi are Native Hawaiians. And while 17%-42% of homeless in Hawaiʻi are employed full time it is obvious that the solution to these problems cannot simply be “to work harder” (hawaiihomeproject.org). The current focus of many Native Hawaiian families is simple: trying to survive. With a high cost of living, many families are living pay check to pay check while every day more and more Native Hawaiians have to look at the very real reality of either homelessness or relocation.
In terms of education, Native Hawaiians are well below the national average in regards to not only graduating high school, attending college, but also even in receiving education past a bachelors degree (18mr.org). There is a disproportionate amount of Native Hawaiians in education but and other professional fields. Even in an academic environment there is a stigma attached to Indigenous people. Prejudice is alive and well, from the fact that, while away in New York at college, I am repeatedly told that I speak ‘pretty good English for a foreigner’, to the fact that most students and faculty there either cannot or will not learn to pronounce my name correctly. They instead choose to nickname me "Hawai’i".
We need to give more time, money, concentration and effort to the education of native peoples. Although programs exist, like Kamehameha Schools and the numerous charter schools that focus on Native Hawaiians and their education, there is still a lack. Programs that exist are usually small scale and woefully underfunded. The government has made it clear repeatedly that education of Native Hawaiian peoples is not priority. This is painfully apparent when funding for Native Hawaiian programs are drastically reduced or eliminated all together.
Change needs to occur, not only for Native Hawaiians, but for all Indigenous peoples and minority groups. I am doing my part in becoming educated so that I may positively contribute to the fight for things such as federal recognition, the survival of our culture and language, the return of our native lands and the survival of our race as a whole. Only when these problems are recognized and addressed can the healing process for my people begin. My hope is that I can improve life for all Hawaiians, those present and those yet to come. I want to be able to tell my children that I did my best to contribute to the Lāhui.
While the situation surrounding Native Hawaiians seems disheartening and altogether depressing in many cases, one thing to understand is that it is not to late to right these wrongs. Native Hawaiians and non-Native Hawaiians alike can come together to improve life for our people and reestablish our rightful place and status within Hawaiʻi. We in Hawaiʻi will never give up and we will continue to strive for justice, equality and what is rightfully ours. Because Hawaiʻi without Hawaiians or Hawaiian culture is not Hawaiʻi at all.
Peru: Indigenous Communities Mobilize, Occupy Oil Wells
Indigenous communities have mobilized to occupy 14 oil wells in Lot 192, the largest oil concession in Peru, which is operated by the Argentine company Pluspetrol. PlusPetrol’s contamination of the region since 2000, plus its predecessor Occidental Petroleum’s similar behavior since 1971, have led to devastating health and environmental impacts among the Indigenous Quechua, Quichua, and Achuar communities who live and depend on that land. It has been estimated that Pluspetrol is losing over 3,000 barrels of oil per day since the protest's start on January 24th and that to date it has lost over 2 million dollars.
Lot 192, formerly 1AB, is located in Loreto, Peru and is deep in the Amazon rainforest. Protesters have also blocked a nearby road, one of very few in the area, while yet another group has blocked a section of a river, impeding eight boats loaded with food and supplies bound for Pluspetrol’s encampment from traveling upriver.
These simultaneous mobilizations are no coincidence; rather they are a result of careful community organizing, despite the complicated logistics of long distances between the communities of the Pastaza, Corrientes, Tigre, and Marañon river watersheds. Without good cell connected, personal visits from one village to another can take up to 30 days of traveling by boat. This organizing is made possible by leadership structure in the form of an Indigenous federation for the communities of each river valley, plus a platform that unites the four federations, the Amazonian Indigenous Peoples United in Defense of their Territory (PUINAMUDT). The Apus, or traditional leaders, of the four federations, which represent over 100 communities and over 20,000 people, have said many times that they are not protesting oil development in and of itself; what they are fighting is "the abuse and indifference of the State over 43 years."
The president of the Loreto department of Peru, Fernando Meléndez, spent three days visiting communities in the region and meeting with their leadership. He has said, “The communities were abandoned, but now they have a president that will listen to them, that’s what I’m working on. I am taking the necessary time to resolve the communities’ problems.”
The Peruvian newspaper Nacional reports that PlusPetrol is inclined to maintain dialogue in “an environment of social peace, which is why they called upon community authorities to "give up their forceful measure that threatens the freedom of river transportation and the oil company’s activities.” Yet these communities have been suffering the impacts of oil contamination for over 40 years. Oil has invaded the water they drink and bathe in, the soil they grow their food in, and the plants and animals that comprise their diets. The Indigenous Federations have sought remedies in the national and international legal spheres and received little response; despite an Environmental State of Emergency and a Health State of Emergency being declared in the area, no meaningful action has been taken to mitigate it. Most recently, the Peruvian government and interested oil companies have begun the bidding process for to renew the concession in August 2015, a process which the Indigenous federations have explicitly said they were not open to consulting on until they had been compensated for past use of their land and related damages. Thus, while the company might consider the communities' manifestations forceful, it is hardly realistic to imply they are unjustified.
Anthropologist and ally to the Amazonian communities Alberto Chirif says, “I have to say, this protest doesn’t surprise me; the Indigenous federations have been addressing a series of demands to the State for three years with the goal of making way for a prior consultation process before bidding on Lot 1AB begins again[.] The State has not addressed a single one of their demands and has instead sought to distract from the issue, which makes a mockery of the Indigenous populations because none of their demands, such as improving water service, health conditions, and schools, are addressed.”
The latest dialogue session on this issue, which was held on February 11 between Pluspetrol representatives and members of the Achuar Indigenous community of Pampa Hermosa in the Corrientes River Valley, was unsatisfactory to the Indigenous parties. For future mediated dialogues, the communities are demanding to speak with Pluspetrol North's Director of Operations for Peru, Rubén Ferrari, rather than the representative who has currently been made available to them, community relations representatives Alfredo Zuñiga. The next meeting will take place on February 13.
Carlos Sandi, president of the Federation of Native Communities of the Corrientes River Valley (FECONACO), has stated that the 16 wells will not be allowed to resume activity until the community's right to compensation is respected, and that Pluspetrol's claims that Pampa Hermosa is not within the area of influence of Pluspetrol's operations are false.
Meanwhile, the Peruvian government has joined Pluspetrol in urging the communities to give up their protests. But "[t]he community is still waiting for the company or the state to fulfill its responsibility, because we're talking about a historic debt to the Indigenous communities in this part of the Amazon," said Sandi.
Kichwa leader José Fachín says, "This is a protest by the whole Kichwa people. They're ready to die for it. The price of oil is low, but the pain caused is extremely high."
Entrenched Corruption and Impunity Continues in Kenya
A senator and three members of parliament were arrested on January 29, 2015 by Criminal Investigation officials in Nairobi after being required to write detailed accounts regarding a peaceful demonstration that turned ugly when police opened fire, killing at least one person and injuring scores of others in Narok County. Interior Cabinet Secretary Joseph Nkaissery--himself a Maasai--has said punitive action will be taken against MPs Moitalel Kenta (Narok North), Korei Lemein (Narok South), Patrick Ntutu (Narok West) Johana Ngeno (Emurwa Dikir) and Senator Stephen ole Ntutu who led the demonstration to protest the manner in which Governor Samuel Tunai is running the affairs of the local county.
A memorandum the officials planned to submit to the Governor includes claims that the World famous Maasai Mara Game Reserve no longer serves the public because it is being exploited by the Governor and the Kenyan ruling elite. The memorandum contains an array of allegations ranging from the Governor using a private army to protect himself and the Oloololo Game ranch that he illegally acquired from the Siria Maasai, and misappropriation of billions of Kenya shillings through dubious contracts including one that was awarded to a firm that the governor and various other leading political elites in Kenyan are associated.
According to the Standard, Police fired shots and teargas as thousands of Maasai Peoples, clad in traditional red cloaks, marched to the governor's office in Narok town, the administrative center of the sprawling Maasai Mara Park, witnesses said. Narok County Commissioner Kassim Farah, an official appointed by the president, commented: "Only one protestor was killed by a bullet."
Available investigative reports indicate that the Governor is not only accused of misappropriation of public funds but in order to cement his strength in one of the wealthiest counties in Kenya, he hires selected individuals in newly-created positions of employment--something that is unconstitutional--with the support of government officials who are said to receive huge monthly perks. These mafia-like activities have mostly been articulated by the Governor's former colleagues at the National Intelligence Service where he served before venturing into politics. The National Intelligence Service actively works on the Governor's behest and they are used by senior government officials to collect intelligence reports on possible threats and to plan how people can be framed by the police on trumped-up charges.
The most striking issue here is that, despite the Maasai members of parliament having raised serious issues affecting their county with the president, officials from the Ethics and Anti-corruption Commission opted to carry out a public audit rather than a forensic audit as requested by the Maasai. This is just one of the many cases where continued systemic marginalization, exploitation, intimidation and expropriation of Maasai resources by the political elites in cahoots with local gate-keepers has continued to deprive the Maasai of their democratic right to self-expression, association and assembly. It is also a blatant attack by the government on the basic rights of the citizens of Kenya contrary to both the Kenyan Constitution and international instruments on human rights.
The Maasai in Kenya are under siege due to the abundance of resources and land that the government has appropriated through unethical, inhuman and unconstitutional means--the act of killing an innocent protester and arresting a group of officials being a clear attempt to intimidate the Maasai to prevent them from continuing to demand justice and accountability at the highest levels of power.
In response to the allegations, the Maasai in Narok County are demanding that the Governor provide a satisfactory explanation to each of the issues raised and assume responsibility for his government's misdeeds. They are also demanding that the government live up to the standards of the constitution especially with regard to the proper management of public funds and resources--a cardinal requirement of the Constitution of Kenya. Calling for the government to promote constitutionalism, become accountable and transparent and ensure public participation, the Maasai are further demanding a formal response within the next 21 days; the failure to comply leaving the Maasai with no choice but to directly exercise the sovereign power of the people as bestowed upon them by the Constitution of Kenya.
Given that the Maasai Mara Game Reserve is a world-renowned tourist attraction, the Maasai are calling upon anyone who visits the Mara to help fight this corruption by either boycotting the Maasai Mara or by calling for a stringent corruption-free system that offers them value for their money. As things stand now, all tourist payments to the Maasai Mara are like a curse to the Maasai who not only conserve the region's flora and fauna but gave up their grazing land for the creation of the famous Game Reserve.
India and the APEC
Amita Batra
The foreign ministers of Russia, China and India at the end of their deliberations in Beijing last week issued a comprehensive joint communiqué that included a recommendation for India’s inclusion in the Asia Pacific Economic Cooperation (APEC) grouping. Earlier in January, a joint strategic vision document that was issued during US President Obama’s visit to India on its 66th Republic day also contained a line welcoming India’s interest in joining APEC. While this was the first formal statement of support by the US for India’s membership in APEC, the Chinese President Xi Jinping had extended an invitation to India in July last year to attend the Beijing APEC summit.
APEC is a twenty one member regional economic grouping that was established in 1989 with its main focus on trade and investment liberalisation and facilitation. The grouping follows the principle of ‘open regionalism’. There are no binding commitments and treaty obligations. Commitments are undertaken on a voluntary basis and capacity-building projects help members implement APEC initiatives. Representing 40 per cent of the world population, 47 per cent of global trade and 57 per cent of global GDP in 2012, the grouping aims at leveraging the economic strength of the 21 member economies for regional prosperity and economic integration. As the world’s third largest economy in PPP terms India would no doubt be a valuable addition to the economic grouping and announcements towards positive support for its inclusion in the APEC are therefore not surprising. What needs emphasis and due recognition is the fact that India’s application for membership to the regional body has been pending for long and even after the moratorium was lifted in 2010. Over this period India has undertaken systemic economic reforms including trade and investment, the positive outcome of which was amply reflected in close to a double digit rate of growth in India accompanied by stable macroeconomic fundamentals. During this period India has also made progress with its regional economic integration agenda participating in not just bilateral trade agreements across sub-regions but also as a member of regional groupings like the East Asia summit and RCEP alongside a plurilateral FTA with the ASEAN.
It may be pertinent to ask therefore if membership of the APEC, for which India has waited for long, now holds any significance, particularly when there is an ongoing debate about the relevance of APEC in the process of regional economic integration.
As discussed in some of the earlier columns in this series, the Asian region is witnessing a consolidation of competing mega regional trade agreements. The US led Trans Pacific Partnership (TPP) agreement with twelve members aimed at ‘WTO plus’ provisions is in the final stages of its negotiations. The RCEP, the other regional economic formulation that brings together the six FTA partners of the ASEAN, with the latter as its nucleus, is expected to be complete its negotiation process by end 2015. In the context, the APEC with its soft institutional structure and voluntary action programmes, having missed its first deadline towards achieving free trade and investment between the advanced economies of APEC by 2010 under the Bogor goals and no closer to achieving the second, of member-wide trade liberalisation agreement by 2020, is yet far from its declared objective of taking forward the idea of economic integration in the region through the ‘next generation’ free trade area of the Asia-Pacific (FTAAP). Slow progress of and internal weaknesses in the APEC appear to be clearing the way for alternative mechanisms like the RCEP and TPP to emerge as predominant formulations in the regional economic integration process. There is in fact a prevailing view that the slow moving APEC has pushed its more committed members to embark on the TPP.
Notwithstanding the challenges that APEC is faced with, India can gain through what can be identified as a core objective and achievement of the APEC, that is, trade facilitation. According to official APEC data, the region’s total trade has increased seven times over the period 1989 to 2012, with two-thirds of this trade occurring between member economies. APEC’s Trade Facilitation Action plan that includes streamlining customs procedures led to a successive reduction of 5 per cent in region-wide costs at the border between 2004 and 2006 and 2007 and 2010. Since the launch of the single window clearance initiative APEC has been able to significantly accelerate the movement of goods across borders. The trade facilitation reforms of the APEC can thus be of great assistance to India now that it is required to ease out the customs procedures and other barriers ‘at’ and ‘behind the border’ as part of implementing the Trade Facilitation Agreement accomplished at the ninth ministerial meeting of the WTO in December 2013. According to the Asia Pacific Trade and Investment Report 2014, single window clearance is not just one of the most far reaching of trade facilitation reforms but also the most complex measures in the TFA. The APEC experience will thus help India design and monitor a national trade facilitation programme.
Much, of course, will depend upon APEC’s ability to sort its long standing dilemma over expansion and appropriate representation of different sub-regions in the forum as also India’s ability to take advantage of possible future membership through prior domestic trade reform.
The foreign ministers of Russia, China and India at the end of their deliberations in Beijing last week issued a comprehensive joint communiqué that included a recommendation for India’s inclusion in the Asia Pacific Economic Cooperation (APEC) grouping. Earlier in January, a joint strategic vision document that was issued during US President Obama’s visit to India on its 66th Republic day also contained a line welcoming India’s interest in joining APEC. While this was the first formal statement of support by the US for India’s membership in APEC, the Chinese President Xi Jinping had extended an invitation to India in July last year to attend the Beijing APEC summit.
APEC is a twenty one member regional economic grouping that was established in 1989 with its main focus on trade and investment liberalisation and facilitation. The grouping follows the principle of ‘open regionalism’. There are no binding commitments and treaty obligations. Commitments are undertaken on a voluntary basis and capacity-building projects help members implement APEC initiatives. Representing 40 per cent of the world population, 47 per cent of global trade and 57 per cent of global GDP in 2012, the grouping aims at leveraging the economic strength of the 21 member economies for regional prosperity and economic integration. As the world’s third largest economy in PPP terms India would no doubt be a valuable addition to the economic grouping and announcements towards positive support for its inclusion in the APEC are therefore not surprising. What needs emphasis and due recognition is the fact that India’s application for membership to the regional body has been pending for long and even after the moratorium was lifted in 2010. Over this period India has undertaken systemic economic reforms including trade and investment, the positive outcome of which was amply reflected in close to a double digit rate of growth in India accompanied by stable macroeconomic fundamentals. During this period India has also made progress with its regional economic integration agenda participating in not just bilateral trade agreements across sub-regions but also as a member of regional groupings like the East Asia summit and RCEP alongside a plurilateral FTA with the ASEAN.
It may be pertinent to ask therefore if membership of the APEC, for which India has waited for long, now holds any significance, particularly when there is an ongoing debate about the relevance of APEC in the process of regional economic integration.
As discussed in some of the earlier columns in this series, the Asian region is witnessing a consolidation of competing mega regional trade agreements. The US led Trans Pacific Partnership (TPP) agreement with twelve members aimed at ‘WTO plus’ provisions is in the final stages of its negotiations. The RCEP, the other regional economic formulation that brings together the six FTA partners of the ASEAN, with the latter as its nucleus, is expected to be complete its negotiation process by end 2015. In the context, the APEC with its soft institutional structure and voluntary action programmes, having missed its first deadline towards achieving free trade and investment between the advanced economies of APEC by 2010 under the Bogor goals and no closer to achieving the second, of member-wide trade liberalisation agreement by 2020, is yet far from its declared objective of taking forward the idea of economic integration in the region through the ‘next generation’ free trade area of the Asia-Pacific (FTAAP). Slow progress of and internal weaknesses in the APEC appear to be clearing the way for alternative mechanisms like the RCEP and TPP to emerge as predominant formulations in the regional economic integration process. There is in fact a prevailing view that the slow moving APEC has pushed its more committed members to embark on the TPP.
Notwithstanding the challenges that APEC is faced with, India can gain through what can be identified as a core objective and achievement of the APEC, that is, trade facilitation. According to official APEC data, the region’s total trade has increased seven times over the period 1989 to 2012, with two-thirds of this trade occurring between member economies. APEC’s Trade Facilitation Action plan that includes streamlining customs procedures led to a successive reduction of 5 per cent in region-wide costs at the border between 2004 and 2006 and 2007 and 2010. Since the launch of the single window clearance initiative APEC has been able to significantly accelerate the movement of goods across borders. The trade facilitation reforms of the APEC can thus be of great assistance to India now that it is required to ease out the customs procedures and other barriers ‘at’ and ‘behind the border’ as part of implementing the Trade Facilitation Agreement accomplished at the ninth ministerial meeting of the WTO in December 2013. According to the Asia Pacific Trade and Investment Report 2014, single window clearance is not just one of the most far reaching of trade facilitation reforms but also the most complex measures in the TFA. The APEC experience will thus help India design and monitor a national trade facilitation programme.
Much, of course, will depend upon APEC’s ability to sort its long standing dilemma over expansion and appropriate representation of different sub-regions in the forum as also India’s ability to take advantage of possible future membership through prior domestic trade reform.
Nepal: Political Rivalries Stymieing Constitution-making
Pramod Jaiswal
After the ruling alliance of the Nepali Congress (NC) and the Communist Party of Nepal-Unified Marxist Leninist (CPN-UML) wanted to draft the constitution with two-thirds majority, the opposition of Maoists and Madhesi parties boycotted all the Constituent Assembly (CA) proceedings. The ruling alliance and the Maoists were party to the Comprehensive Peace Agreement almost a decade ago but are now not even in talking terms. Though they had fought ‘war’ against each other in the past, they had never stopped talking to each other. However, Nepal’s Prime Minister Sushil Koirala has sent a formal letter asking them to return to the CA.
Nepal’s political parties could not deliver the draft of the constitution on their self-imposed 22 January 2015 deadline as they were stuck on issues such as federalism, like the previous CA.
Differences on Federalism
In Nepal, federalism is a subject of most contentious and polarised debate that is approached through various perspectives, such as: change (pro-identity based federalism) vs. status quo forces (federalism on the basis of viability); pluralist vs. mono-culturalist; historically marginalised communities vs. upper caste hill dominance; and political de-centralisation vs. administrative de-centralisation.
By and large, the new political forces that emerged in Nepal after the promulgation of the 1990 constitution – such as the Maoists and the various political parties that arose from social movements of Madhesis, Janjatis etc. – associate themselves with the former, while traditional parties such as the NC and CPN-UML associate themselves with latter categories.
The newly-emerged political parties would like to prioritise identity recognition in the federal scheme, so that marginalised social groups can enjoy a degree of demographic dominance in the units. In Madhes, they demand two provinces in the Tarai, carved out on an east west horizontal axis. This will give political empowerment to Madhesis in the eastern plains and Thaurs in the western plains.
On the contrary, the NC and the UML want to create a federal scheme that prioritises administrative viability. It will give demographic dominance to hill Hindu upper castes who have exercised power for long. In Madhes, they also want to carve out provinces on a north-south vertical axis that connects the hills and the Tarai. Differences also exist in regard to boundary-demarcation of districts in the Tarai. The NC and the UML want it integrated in the hills while Madhesi wants to retain it in the plains.
In order to get the constitution passed through their model of federalism with six federal provinces, the NC and the UML are prepared to use their two-third majority in the CA. The Maoists and the Madhesis demand that the constitution should reflect the spirit of the Comprehensive Peace Agreement and the aspirations of the Madhes movement rather than their number in the CA. Subhas Nemwang, Chairman, CA, acquiesced with the NC and the UML and initiated the process. The Maoists and the Madhesi parties boycotted the CA and announced an agitation.
Emergence of KP OliAt present, K P Oli, Chairman, CPN-UML, has emerged as a powerful leader and he is solely responsible for the souring relationship between the ruling alliance and the opposition. His statements have polarised the Nepali society like never before while Prime Minister Sushil Koirala has no authority over the situation.
Oli, who was once an armed revolutionary, inspired by the Indian Naxalbari movement in the late 1960s, left the path of violence and joined a mainstream party. He has strongly stood against the Maoists and their ideas of federalism and republic. Additionally, he was not pleased with the peace process aimed at mainstreaming the Maoists.
Political analysts such as Prashant Jha state that Oli played a key role in mobilising non-Maoist forces to come together against the then Maoist PM Prachanda’s efforts to topple the army chief in 2009. He explains that one of Oli’s closest confidantes, Bidya Bhandari, was viscerally opposed to respectful integration of former Maoist combatants into the Nepal Army. Oli also believed that the first CA, where the Maoists had a majority, was not the best platform to promulgate a constitution and actively worked to subvert it. Experts believe that Oli’s strong hardline position is to weaken Maoists in the hills and the NC in the plains – to help UML to emerge as the single largest party in the next election.
Option for IndiaIndia, being a major stake holder of Nepal’s peace process should use its leverage, invest political capital in creating pressure on the ruling alliance and the opposition to return to the table and work out a consensus. Modi, during 2014 Nepal visit, reiterated that the constitution must be a product of consensus among all major political forces; it must not be a product of a numbers game for that will invite problems. He remarked that while a constitution is being drafted, it must be done in a manner that gives a sense of ownership to the Maoists, the Madhesis, and the pahadis. The constitution is the document of compromise and the debate to make Nepal inclusive must ensure the aspiration of historically marginalised peoples towards making all citizens equal, and simultaneously not making them unequal via federalism.
After the ruling alliance of the Nepali Congress (NC) and the Communist Party of Nepal-Unified Marxist Leninist (CPN-UML) wanted to draft the constitution with two-thirds majority, the opposition of Maoists and Madhesi parties boycotted all the Constituent Assembly (CA) proceedings. The ruling alliance and the Maoists were party to the Comprehensive Peace Agreement almost a decade ago but are now not even in talking terms. Though they had fought ‘war’ against each other in the past, they had never stopped talking to each other. However, Nepal’s Prime Minister Sushil Koirala has sent a formal letter asking them to return to the CA.
Nepal’s political parties could not deliver the draft of the constitution on their self-imposed 22 January 2015 deadline as they were stuck on issues such as federalism, like the previous CA.
Differences on Federalism
In Nepal, federalism is a subject of most contentious and polarised debate that is approached through various perspectives, such as: change (pro-identity based federalism) vs. status quo forces (federalism on the basis of viability); pluralist vs. mono-culturalist; historically marginalised communities vs. upper caste hill dominance; and political de-centralisation vs. administrative de-centralisation.
By and large, the new political forces that emerged in Nepal after the promulgation of the 1990 constitution – such as the Maoists and the various political parties that arose from social movements of Madhesis, Janjatis etc. – associate themselves with the former, while traditional parties such as the NC and CPN-UML associate themselves with latter categories.
The newly-emerged political parties would like to prioritise identity recognition in the federal scheme, so that marginalised social groups can enjoy a degree of demographic dominance in the units. In Madhes, they demand two provinces in the Tarai, carved out on an east west horizontal axis. This will give political empowerment to Madhesis in the eastern plains and Thaurs in the western plains.
On the contrary, the NC and the UML want to create a federal scheme that prioritises administrative viability. It will give demographic dominance to hill Hindu upper castes who have exercised power for long. In Madhes, they also want to carve out provinces on a north-south vertical axis that connects the hills and the Tarai. Differences also exist in regard to boundary-demarcation of districts in the Tarai. The NC and the UML want it integrated in the hills while Madhesi wants to retain it in the plains.
In order to get the constitution passed through their model of federalism with six federal provinces, the NC and the UML are prepared to use their two-third majority in the CA. The Maoists and the Madhesis demand that the constitution should reflect the spirit of the Comprehensive Peace Agreement and the aspirations of the Madhes movement rather than their number in the CA. Subhas Nemwang, Chairman, CA, acquiesced with the NC and the UML and initiated the process. The Maoists and the Madhesi parties boycotted the CA and announced an agitation.
Emergence of KP OliAt present, K P Oli, Chairman, CPN-UML, has emerged as a powerful leader and he is solely responsible for the souring relationship between the ruling alliance and the opposition. His statements have polarised the Nepali society like never before while Prime Minister Sushil Koirala has no authority over the situation.
Oli, who was once an armed revolutionary, inspired by the Indian Naxalbari movement in the late 1960s, left the path of violence and joined a mainstream party. He has strongly stood against the Maoists and their ideas of federalism and republic. Additionally, he was not pleased with the peace process aimed at mainstreaming the Maoists.
Political analysts such as Prashant Jha state that Oli played a key role in mobilising non-Maoist forces to come together against the then Maoist PM Prachanda’s efforts to topple the army chief in 2009. He explains that one of Oli’s closest confidantes, Bidya Bhandari, was viscerally opposed to respectful integration of former Maoist combatants into the Nepal Army. Oli also believed that the first CA, where the Maoists had a majority, was not the best platform to promulgate a constitution and actively worked to subvert it. Experts believe that Oli’s strong hardline position is to weaken Maoists in the hills and the NC in the plains – to help UML to emerge as the single largest party in the next election.
Option for IndiaIndia, being a major stake holder of Nepal’s peace process should use its leverage, invest political capital in creating pressure on the ruling alliance and the opposition to return to the table and work out a consensus. Modi, during 2014 Nepal visit, reiterated that the constitution must be a product of consensus among all major political forces; it must not be a product of a numbers game for that will invite problems. He remarked that while a constitution is being drafted, it must be done in a manner that gives a sense of ownership to the Maoists, the Madhesis, and the pahadis. The constitution is the document of compromise and the debate to make Nepal inclusive must ensure the aspiration of historically marginalised peoples towards making all citizens equal, and simultaneously not making them unequal via federalism.
Australia: NSW electricity workers face more job losses
Terry Cook
Whichever party—Labor or Liberal—wins the March 28 election in New South Wales (NSW), workers in the state-owned electricity power distribution network face a deepening assault on their jobs and conditions.
The NSW Liberal-National Party Coalition government has pledged to sell off 49 percent of state’s multi-billion dollar “poles and wires” electricity network if returned to office.
The partial privatisation is to be initiated through a long-term leasing arrangement of two power distribution companies, Ausgrid and Endeavour Energy, that provide electricity for Sydney, Newcastle and Wollongong, the state’s main population areas.
The state-owned high voltage network company Transgrid will be fully privatised. However rural power distributor Essential Energy will remain government-owned for now in a move designed to placate opposition the National Party’s rural constituencies.
NSW Premier Mike Baird claims the proceeds from the sell-off are needed to partially fund a $20 billion state infrastructure program. An additional $2 billion will be provided by the federal Liberal-National Coalition government under its so-called “asset-recycling” scheme. The federal plan is aimed at encouraging state governments to privatise remaining state-owned enterprises and industries.
Last month Networks NSW, which operates the electricity distribution companies, met with power unions to inform them that it was sending out letters asking employees to consider accepting voluntary redundancy packages.
According to the Electrical Trade Union (ETU), Networks NSW head Vince Graham said that management was looking to shed up to 4,300 jobs across its operations. The job losses include 2,500 at Ausgrid and 700 at Endeavour. Graham also confirmed that 700 apprentices currently employed by the distribution companies would not be retained at end of their training.
Graham claimed that the jobs cuts were made necessary by draft decisions handed down by the Australian Energy Regulator (AER) in November last year. Established in 2005, the AER regulates energy markets and networks and sets prices, mainly in NSW, South Australia, Tasmania and the Australian Capital Territory.
The AER decision—determining what the NSW’s distribution network companies can charge customers to recoup network upgrade and maintenance costs—proposes retrospectively to reduce their revenue allowances by $6.5 billion or 27 percent over the five-year period to 2019.
The Baird government is opposing the AER draft decision because the fall in revenue could make the assets sale less attractive to potential buyers. However, it has no compunction about utilising the decision to justify its decision to slash thousands of jobs.
In a further move to cut costs and to facilitate privatisation, the Baird government is also insisting that wage rises under negotiation be kept below the public sector cap of 2.5 percent. Significantly, the management has also opposed the inclusion of a “no-forced redundancy” clause in the next work agreement, giving future private owners a free hand to slash jobs.
The opposition Labor Party and the trade unions are mounting a cynical campaign supposedly against privatisation in a bid to garner votes in next month’s state election. However, while Labor has pledged to oppose selling off the electricity “poles and wires”, newly-installed party leader Luke Foley is also signalling to big business that he is not opposed to privatisation as such.
Foley told the media recently that he “did not bring an ideological approach to privatisation.” As evidence, he explained that he had supported the current state Liberal government’s sale of port facilities in Sydney, Newcastle and Wollongong.
In an exclusive interview with Murdoch’s Australian last month headlined “Socialist? Not I, says new ALP boss,” Foley declared that if elected he would “champion an enterprising private sector” and retain only “an essential public sector.” He called for a ditching of the party’s 1921 socialisation clause, which was a dead letter from the inception, and for policies that “reflect modern circumstances.”
Addressing the issue of privatisation, Foley explained that “public ownership of industry, production, distribution and exchange is a policy, not a value. The policy, whether it is public ownership or anything else, is not set in stone forever.” When it comes to electricity privatisation, the pledge of opposition is unlikely to last beyond next month’s election day.
In fact, the former state Labor government only abandoned a plan to privatise the entire NSW power industry in the face of deep-seated opposition by working people, including power workers. Even so, on the eve of the last state election in 2011 it pushed through legislation for the sale of the state’s electricity distributors.
The partial sell-off was an “option” devised by the state’s peak union body in order to take the heat out of the privatisation issue in a bid to save Labor from an electoral rout. It was also designed to keep the door open for Labor to implement further asset sales if it was returned to office.
While the union’s plan failed to save Labor from a landslide electoral defeat, it paved the way for the incoming state Liberal O’Farrell government to sell off the state’s electricity generators Delta Energy, Macquarie Generation and Eraring Energy.
This sell-off could only proceed with the assistance of the unions that worked to block any action by power industry employees and other sections of the working class and ensure not a shot was fired in opposition.
The same trade unions are now mounting a bogus “anti-privatisation” campaign to try to harness widespread public opposition and boost Labor’s election campaign. The ETU and the United Services Union are currently balloting members to take limited industrial action timed to coincide with the lead-up to the election date on March 28. Unions NSW is preparing a wider campaign, including saturation phone calling and doorknocking.
One can be certain that the unions will remain completely silent on Labor’s record in office, including its sale of state assets, decades-long assault on the jobs and conditions of state sector workers and the systematic gutting of vital social services. The unions themselves actively collaborated in this relentless assault on the working class.
The record demonstrates that working people cannot oppose the assault on jobs and living standards by voting to replace one capitalist party with another, or through the unions whose interests are bound up with maintaining the profit system. Moreover, whether enterprises are publicly owned, partially privatised, corporatised or state-owned, workers confront an escalating assault on jobs and conditions as the crisis of capitalism deepens.
To defend its social rights, the working class must mobilise independently of all the parties of big business and fight for a workers’ governments on the basis of an internationalist and socialist program to reorganise society to meet the pressing social needs of the majority not the obscene profits of the wealthy few.
Political crisis in Jakarta over national police chief
John Roberts
As Indonesian President Joko Widodo finished his first 100 days in office, he has found himself in a vitriolic conflict over his nomination for the post of national police chief. The public wrangling is not so far with the parliamentary opposition, but with his own party, the Indonesian Democratic Party of Struggle (PDI-P), and its leader and former president, Megawati Sukarnoputri.
Widodo announced the appointment of Police General Budi Gunawan to the powerful position of national police chief on January 9. The decision was clearly in line with Megawati’s wishes as Budi is politically close to her having served as her adjutant during her terms as vice president and president between 1999 and 2004.
Budi’s appointment was formally approved by the National Police Commission. However, within days, the country’s anti-corruption watchdog—the Corruption Eradication Commission (KPK)—announced that Budi had been under investigation since July over suspicious bank accounts and money laundering. He has denied the charges and launched a court case to clear his name.
The Indonesian parliament endorsed Budi as national police chief on January 16 despite the corruption allegation and growing public criticism of the appointment. The lower house of parliament is dominated by a coalition led by former Suharto-era general Prabowo Subianto, who was Widodo’s main rival in last year’s bitterly contested presidential election. A number of media pundits have speculated that Prabowo was seeking to encourage a split between Widodo and Megawati.
The following day, Widodo temporarily suspended Budi’s appointment and established an 11-member panel to advise him on the question. Widodo faces a dilemma. If he proceeds with the appointment, his efforts to promote himself as an outsider intent on rooting out corruption in the widely despised Jakarta establishment will be tarnished. However, if he refuses to install Budi, he risks a widening rift with Megawati and the PDI-P undermining his political base of support.
The crisis has been compounded by what amounts to a contest of police against the KPK. On January 23, police arrested deputy KPK commissioner Bambang Widjojanto on a dubious charge of allegedly ordering a witness to commit perjury in a Constitutional Court case in 2010. Bambang subsequently resigned from the commission. The police then launched investigations against three more of the five-member commission. The allegations against the KPK officials appear to have originated from within the PDI-P or persons associated with the party.
The police, which functioned for three decades as one of the arms of repression of the Suharto dictatorship, are notorious for corruption and hostile to any attempt to curb their powers and hold them accountable. The KPK was established by Widodo’s predecessor Susilo Bambang Yudhoyono in 2002 in order to give some credibility to his claims to be fighting corruption. It has made no serious inroads into Indonesia’s ubiquitous corruption but its cases have previously brought it into conflict with the police.
Widodo is yet to make any decision on Budi’s appointment and initially at least attempted to keep out of the confrontation between the police and the KPK, saying only that they were both important state institutions. The president’s 11-person panel recommended on January 28 that Budi be dumped. A week later, Widodo left for state visits to Malaysia, Brunei and the Philippines and only arrived back in Jakarta on Monday.
Megawati and her close PDI-P supporters have reacted furiously to Widodo’s handling of the affair. The Jakarta Post reported on January 27 that Megawati had gathered her “inner circle” at her official residence in Central Jakarta and demanded they fight for the installation of Budi. She told the gathering that PDI-P parliamentarians might have to withdraw their support for the Widodo presidency.
On February 3, Megawati personally attended a meeting of leaders of the pro-government coalition parties. According to Widodo’s vice president Jusuf Kalla, the fate of Budi was discussed with a proposal to demand his immediate installation as police chief. Megawati has also given the green light for open political attacks on Widodo.
Most prominent is senior PDI-P parliamentarian Effendi Simbolon, who has threatened to impeach Widodo for failing to proceed with an appointment that has been approved by parliament. At this stage, an impeachment appears highly unlikely unless the Prabowo coalition were to support it.
The Jakarta Globe on February 2 reported that Effendi had accused three of Widodo’s close aides of isolating the president from the PDI-P. The newspaper reported that some of the president’s critics have blamed the same inner circle for undermining the PDI-P by pushing Widodo to carry out highly unpopular pro-market measures. Widodo’s ending of fuel price subsidies last year triggered widespread public opposition.
As the criticisms of economic policy demonstrate, the political instability in Jakarta in bound up with broader issues than Budi’s appointment as national police chief. The Indonesian economy is slowing with the latest figures showing a growth rate of 5.02 percent for 2014, the lowest level in five years and well below the government’s targets. Declining economic fortunes are contributing to the political factional infighting.
Widodo has secured some support from unusual quarters. On January 28, Prabowo met with Widodo for closed door talks. Prabowo later declared that any decision Widodo made in relation to the national police chief would be in the national interest. The opposition coalition stands to gain from the crisis whatever the outcome.
Last Friday the largest demonstration yet in support of the KPK took place outside its offices when it was rumoured that police were about to raid the KPK building as part of their hunt for evidence against its commissioners. This week Widodo ordered the national police to investigate death threats made against KPK officials.
Widodo has already been criticised by human rights organisations for not immediately dumping Budi and failing to adequately protect the KPK. Civil Society Coalition member Usman Hamid told the Jakarta Post: “In our opinion, there has never been a case where the credibility of a president has dropped to the level that he is at right now. His sluggishness in making any decision has turned all state institutions into laughing stocks.”
According to a Reuters report today, Widodo intends to choose another candidate for national police chief. “Budi Gunawan will not be police chief, the president has already decided,” one senior presidential palace official told the newsagency.
Whether that is the case or not, the affair has not only exposed Widodo’s political vulnerability as well as his posturing during the election campaign as a “man of the people” and anti-corruption fighter. Powerful political forces including Megawati and Prabowo plucked Widodo from obscurity and fashioned him into a convenient tool for interests of the country’s wealthy elites.
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