Bill Totten's Weblog

Wednesday, July 13, 2005

Africa's New Best Friends

The corporations which helped to immiserate Africa are being given control of its development.

by George Monbiot

Published in the Guardian (July 05 2005)

I began to realise how much trouble we were in when Hilary Benn, the Secretary of State for International Development, announced that he would be joining the Make Poverty History march on Saturday. What would he be chanting?, I wondered. "Down with me and all I stand for"?

Benn is the man in charge of using British aid to persuade African countries to privatise their public services: wasn't the march supposed to be a protest against policies like his? But its aims were either expressed or interpreted so loosely that anyone could join. This was its strength and its weakness. The Daily Mail ran pictures of Gordon Brown and Bob Geldof on its front page, with the headline "Let's Roll", showing that nothing either Live 8 or Make Poverty History has done so far represents a threat to power. The G8 leaders and the business interests their summit promotes can absorb our demands for aid, debt, even slightly fairer terms of trade, and lose nothing. They can wear our colours, speak our language, claim to support our aims, and discover in our agitation not new constraints, but new opportunities for manufacturing consent. Justice, this consensus says, can be achieved without confronting power.

They invite our representatives to share their stage, we invite theirs to share ours. The economist Noreena Hertz offers, according to the commercial speakers' agency that hires her, "real solutions for businesses and individuals. Hertz teaches companies how to be smart and avoid the frictions which surface when corporate interests conflict with private life ... the political right is not necessarily wrong". <1> Then she stands on the Make Poverty History stage and calls for poverty to be put at the top of the agenda. There is, as far as some of the Make Poverty History organisers are concerned, no contradiction: the new consensus denies that there's a conflict between ending poverty and business as usual.

The G8 leaders have seized this opportunity with both hands. Multinational corporations, they argue, are not the cause of Africa's problems, but the solution. From now on, they will be responsible for the relief of poverty.

In the United States, they have already been given control of the primary instrument of US policy towards Africa, the African Growth and Opportunity Act. The act is a fascinating compound of professed philanthropy and raw self-interest. To become eligible for help, African countries must bring about "a market-based economy that protects private property rights", "the elimination of barriers to United States trade and investment" and a conducive environment for US "foreign policy interests". <2> In return they will be allowed "preferential treatment" for some of their products in US markets.

The important word is "some". Clothing factories in Africa will be allowed to sell their products to the US as long as they use "fabrics wholly formed and cut in the United States" or if they avoid direct competition with US products. The act, treading carefully around the toes of US manufacturing interests, is comically specific. Garments containing elastic strips, for example, are eligible only if the elastic is "less than one inch in width and used in the production of brassieres". <3> Even so, African countries' preferential treatment will be terminated if it results in "a surge in imports".

It goes without saying that all this is classified as foreign aid. The act instructs the US Agency for International Development to develop "a receptive environment for trade and investment". What is more interesting is that its implementation has been outsourced to another agency, the Corporate Council on Africa.

The CCA is the lobby group representing the big US corporations with interests in Africa: Halliburton, Exxon Mobil, Coca-Cola, General Motors, Starbucks, Raytheon, Microsoft, Boeing, Cargill, Citigroup and others. <4> For the CCA, what is good for General Motors is good for Africa: "until African countries are able to earn greater income", it says, "their ability to buy US products will be limited". <5> The US State Department has put it in charge of training African governments and businesses. <6> The CCA runs the US government's annual forum for African business, and hosts the Growth and Opportunity Act's steering committee. <7>

Now something very similar is being rolled out in the United Kingdom. Today the Business Action for Africa summit will open in London with a message from Tony Blair. It is chaired by Sir Mark Moody Stuart, the head of Anglo American, and its speakers include executives from Shell, British American Tobacco, Standard Chartered Bank, De Beers and the Corporate Council on Africa. <8> One of its purposes is to inaugurate the Investment Climate Facility, a $550 million fund which will be financed by the UK's foreign aid budget, the World Bank and the other G8 nations, but "driven and controlled by the private sector". <9> The fund will be launched by Niall Fitzgerald, currently head of Reuters, but formerly chief executive of Unilever, and before that Unilever's representative in apartheid South Africa. <10> He wants the facility, he says, to help create a "healthy investment climate" which will offer companies "attractive financial returns compared to competing destinations". <11> Anglo American and Barclays have already volunteered to help. <12>

Few would deny that one of the things Africa needs is investment. But investment by many of our multinationals has not enriched its people but impoverished them. The history of corporate involvement in Africa is a history of forced labour, evictions, murder, wars, the under-costing of resources, tax evasion and collusion with dictators. Nothing in either the Investment Climate Facility or the Growth and Opportunity Act imposes mandatory constraints on corporations. While their power and profits in Africa will be enhanced with the help of our foreign aid budgets, they will be bound only by voluntary commitments: of the kind that have been in place since 1976 and have proved useless. <13>

Just as Gordon Brown's "moral crusade" encourages us to forget the armed crusade he financed, so the state-sponsored rebranding of the companies working in Africa prompts us to forget what Shell has been doing in Nigeria, what Barclays and Anglo American and De Beers have done in South Africa, and what British American Tobacco has done just about everywhere. From now on, the G8 would like us to believe, these companies will be Africa's best friends. In the name of making poverty history, the G8 has given a new, multi-headed East India Company a mandate to govern the continent.

Without a critique of power, our campaign, so marvellously and so disastrously inclusive, will merely enhance this effort. Debt, unfair terms of trade and poverty are not causes of Africa's problems but symptoms. The cause is power: the ability of the G8 nations and their corporations to run other people's lives. Where, on the Live 8 stages and at the rally in Edinburgh, was the campaign against the G8's control of the World Bank, the International Monetary Fund and the United Nations? Where was the demand for binding global laws for multinational companies?

At the Make Poverty History march, the speakers insisted that we are dragging the G8 leaders kicking and screaming towards our demands. It seems to me that the G8 leaders are dragging us dancing and cheering towards theirs.


1. The Greater Talent Network, no date. Noreena Hertz: Global Activist and Socio-Economist.

2. The African Growth and Opportunity Act. HR 434, 2000.

3. ibid.


5. The Corporate Council on Africa, December 2003. The African Growth and Opportunity Act: a comprehensive business guide to trading under AGOA. CCA, Washington DC.

6. ibid.

7. ibid.

8. Business Action for Africa conference, 5th - 6th July.

9. The Commonwealth Business Council, 13th June 2005. Private Sector to drive new investment climate facility (ICF).

10. Richard Wachman, 3rd July 2005. Irish knight fights for Africa. The Observer.

11. Quoted by Felicity Duncan, 6th June 2005. Easy Does It. Moneyweb.

12. James Hall, 3rd July 2005. Business tapped in $550 million Africa fund. The Telegraph.

13. The OECD's Guidelines for Multinational Enterprises.

Bill Totten


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