Dear friends and colleagues,

I would like to call your attention a Debt and Development Coalition Ireland report released this week (which I authored). The report deals with Argentina's experience with debt, default and restructuring and vulture funds. The report also discusses different proposals for dealing with sovereign defaults. Those interested can find the report at:

http://www.debtireland.org/news/2015/03/26/new-report-now-online-towards-justice-centred-debt/
Alan
--

Alan Cibils
Investigador Docente
Coordinador Área de Economía Política
Instituto de Industria
Universidad Nacional de General Sarmiento http://www.ungs.edu.ar/ecopol/
(+54-11) 4469-7500, int/ext: 7282

Dear all,

We are pleased to share with you a new paper titled "The Post-2015 Corporate Development Agenda: Expanding Corporate Power in the Name of Sustainable Development."  The paper discusses how the corporate sector is trying to position itself front and center of the post-2015 development agenda by staking a claim at three levels: First, by setting goals that would suit their priorities for expansion; second, by claiming a primary role in mobilizing the means for implementing these goals; third, by shaping the governance framework that would be set-up to ensure progress in this agenda.

The paper warns that the danger lies not only in the failure of the post-2015 agenda to promote transformative change, but also in the prospect of rationalizing and legitimizing the further expansion of corporate power in the guise of promoting sustainability and addressing the needs of the poor.

Download the paper at the CPG website through this link http://bit.ly/1GsBKtV

Thank you.

 

--

Paul Quintos
IBON International
3rd Flr., IBON Center
114 Timog Avenue,
Quezon City 1103
Philippines
Telefax: +63 2 9276981
Skype ID: paul.quintos
Websites: iboninternational.org
peoplesgoals.org

Dear colleagues

From our CADTM news
Best regards,

Éric Toussaint
Senior Lecturer at the University of Liège,
President of CADTM Belgium (Committee for the Abolition of Third-World Debt)

www.cadtm.org/The-Speaker-of-the-Greek

by CADTM

20 March 2015

The Speaker of the Greek parliament launches a debt audit commission

The Speaker of the Greek parliament, Zoé Konstantopoulou, has announced during a press conference on 17 March 2015 the creation of a commission to audit the Greek debt. The scientific coordination of the commission will be led by Eric Toussaint, Spokesman for CADTM and a member of the Ecuadorian debt audit Commission that sat in 2007-2008. “The purpose is to identify any debts taken on by the Greek government that may have an illegal, illegitimate or odious nature,” the Greek people “has the right to demand that any part of the Greek debt that may eventually be shown to be illegal – be erased,” declared the Greek Parliament’s Speaker.

Also present at the press conference was Sofia Sakorafa, SYRIZA elected MEP (since 2014), who accepted to be the newly formed committee’s liaison with the European Parliament. Sofia Sakorafa quit the PASOK party in 2010 when George Papandreou pushed through the memorandum signed conjointly with the Troika. Already in December 2010 as a Greek MP she was favourable to a proposition to create a debt audit. In 2011, she took part in launching a committee for the citizen’s audit of Greek debt (ELE). In 2012 she was the the Greek MP, all parties considered, elected with the highest number of votes. Georges Katrougalos, Minister for institutional reform was also present at the press conference to bring his support to the Parliamentary Speaker’s initiative. Georges Katrougalos had also participated in the launching of ELE. Finally, the Parliamentary Speakerhailed the presence of ELE members: Moisis Litsis, Sonia and Giorgos Mitralias ( CADTM Greece), and Leonidas Vatikiodis (one of the authors of the films Debtocracy and Catastroïka).

The Greek, as well as French and Spanish, media have widely reported this press conference:(Le Monde, Le Soir, L’Echo, L’Avenir, Agence France Presse...), as well as publicly run radio stations in Belgium and Romansh Switzerland. The one o’clock news on the Belgian public radio and television service broadcast an interview with Eric Toussaint live from Syndagma place in Athens just after the press conference (can be seen here).

In all, about thirty Greek and International experts will take part in the commission and a preliminary report is expected in June. “Either when the 20 February agreement comes to termination or when a new round of negotiations will start”, says Adea Guillot, permanent correspondant to Le Soir and Le Monde. Not all of the names of the commission members will not be known until the first meeting in early April. From April to June is not much time but that will only be the beginning. Eric Toussaint said in an interview given to the Belgian financial newspaper L’Echo “We will make a preliminary report in June mostly concerning the debt claimed by the Troika, now called the ’Institutions’, but the whole audit will probably take until December 2015. The goal of the commission is to show to the Greek people, by deep reaching analysis, the nature of the loans made to Greece. This matter is urgent, the Greek people are being stigmatised”.

Zoé Konstantopoulou is already being accused by different Greek political parties (New Democracy, PASOK and Potami) of fanning the flames of dissent. But this woman, who has an enormous capacity for work (http://www.lemonde.fr/international... ), will keep going. “A whole people has been pushed to its knees and we cannot accept to be subjected to such propaganda (…) We have a duty to act or this debt will burden our future generations.”

In any case the Debt Audit Commission is not a substitute for the Greek government who will decide which debts should be paid and which debts should be erased. Again as Adea Guillot remarked: “Once the result of the audit is known, and should it conclude that a part of the Greek debt is illegitimate, nothing will oblige the creditors to accept pure and simple write-offs of their loans. But ’the Greek government could take the sovereign decision not to pay’, says Eric Toussaint. ’Our commission seeks to provide solid and rational arguments to support the Greek government should it take this course of action’, he added”.

Dear colleagues,

On the 18th March, the Public Services International Research Unit (PSIRU) hosted a side event in New York to promote the report “Why Public-Private-Partnerships don’t work”. The report assessed the impact of Public-Private Partnerships (PPPs) actually undertaken in rich and poor countries. These global case studies show that there is no evidence that PPPs are cheaper or more convenient for governments in the long-term.

Public Private Partnerships (PPPs) are essentially a government service or private business venture which is funded and operated through a long-term agreement between government and private sector companies. These can come in different forms, from building roads or schools at a small scale, or even electricity grids on a larger scale. There are several reasons why these partnerships can be beneficial. Governments often are under strict controls and regulations for how public funds are spent and sometimes do not have the capacity or resources to initiate or maintain various services. In contrast, private sector companies often have access to such resources, including large investment capital, and have the capacity to undertake larger scale projects. A private partner delivers and funds public services using a capital asset, sharing the associated risk.

The private sector are not willing to invest unless they think they will get a return on their investment. They are for profit and as such it is understandable that the private sector prefer to finance lucrative infrastructure projects. Agreements also allow the private sector to sue the government if they appear to be competing with them --an example given was when drivers avoid a toll road by taking backroads and the villagers get the local authorities to fix or expand that road. The local authorities then got sued by the company who made the toll road for loss of earnings. The report “Why Public-Private-Partnerships don’t work” provides numerous case studies of where PPPs proved to be costly, did not bring new money, masked corruption, and distorted policy priorities. But as one speaker noted, “Shouldn’t we be suspicious when the private sector comes with a bag of money to solve our problems?”

The report provides evidence that far from being a solution for countries under fiscal constraints, PPPs can instead “worsen fiscal problems”, as in the cases of Cyprus, Greece, Ireland, Portugal, Spain and the UK. Such arrangements can legally lock governments into agreements that they don’t profit from, yet assume the majority of the risk. For example, India is using public finance to “bail out existing PPPs which are now unable to find private finance”.

Globally, international consultant firms, are promoting PPPs as a solution to public development financing. The PSIRU report disproves a significant amount of the existing reports or forecasts on why PPPs are a good alternative to public funding. For example, in 2007 McKinsey published a report which “claimed the private sector could provide over half of the $30 billion investment needed to develop healthcare in Africa over the next 10 years… but by 2012 it had resulted in almost no private finance.” (p21). PPPs thus appear counterproductive, expensive and an inefficient. The question remains: are PPPs instrumental in facilitating corruption or push debts beyond political cycles, and who is responsible for monitoring this?

Another consideration is whether PPPs are merely an “accounting trick”, a way for governments to navigate around their own constraints on public borrowing while providing long-term state guarantees for profits to private companies. It is clear that for the Post-2015 Development Agenda to succeed, there will need to be both adequate funding for implementation and the political commitment to change. At an international level, there appears to be a focus on partnering with the private sector as a potential solution to the emerging financing gap of “ambitious aspirations” to develop sustainably and the political commitment, but whether PPPs are the best solution to this remains in question. However, in an environment where sovereign debt is growing and there are stricter controls on public borrowing, should PPPs be a used as a stopgap solution for governments?

According to the discussion in the side event and the PSIRU report, it seems that the common taxpayer bears the brunt of paying for services that should be funded with public finance and paying for the fallout when things do not go as planned. Despite this, PPPs continue to be promoted by international financial institutions, such as the G20 and OECD, and are even being considered in intergovernmental negotiations at the UN for the Sustainable Development Goals and Financing for Development (Zero Draft Report para 52).

It remains unclear why so much emphasis is being placed on PPPs. Questions regarding the political commitment to achieving change remain and there is the ever growing concern that PPPs may just be another way of repackaging special interest and maintaining the status quo.

Best regards
Sabá Loftus
Social Watch

Read more:

Report: Why Public-Private-Partnerships don’t work
Financing for Development Zero Draft
Why fighting illicit capital is not a priority?
Goals for the Rich: Indispensable for a Universal Post-2015 Agenda Discussion Paper
OECD Principles for Public Governance of Public-Private Partnerships

Dear colleagues,

 

LAST WEEK, The US criticized the British government for its “constant accommodation” of China, the latest example of which would be the UK’s decision to become a founding member of a regional initiative announced last year in Beijing to create an Asian Infrastructure Investment Bank (AIIB). Other than worries about British accommodation of China expressed to the Financial Times by “a senior US official”, an official statement from the White House expressed these concerns:

 

“We believe any new multilateral institution should incorporate the high standards of the World Bank and the regional development banks… Based on many discussions, we have concerns about whether the AIIB will meet these high standards, particularly related to governance, and environmental and social safeguards… The international community has a stake in seeing the AIIB complement the existing architecture, and to work effectively alongside the World Bank and Asian Development Bank.”

 

It should be noted, however, that the Asian Development Bank is not among the regional banks that have adopted a full-fledged labour safeguard requiring compliance with the ILO’s core labour standards. Only the European Bank for Reconstruction and Development and the African Development Bank have done that.

 

The World Bank, which is currently revising its social and environmental safeguards policies, has been heavily criticized by trade unions and CSOs for not requiring full compliance with CLS in the first draft of its new policy and for excluding most workers by exempting contractors. The policy is currently being redrafted and will be made public later this year.

 

An article in the Guardian (worth looking at for the photo alone) is available here:

http://www.theguardian.com/us-news/2015/mar/13/white-house-pointedly-asks-uk-to-use-its-voice-as-part-of-chinese-led-bank

 

More coverage and comment is in the Financial Times:

“US attacks UK’s ‘constant accommodation’ with China”

http://www.ft.com/intl/cms/s/0/31c4880a-c8d2-11e4-bc64-00144feab7de.html

 

THIS WEEK, the governments of three additional European countries – France, Germany and Italy – have stated that they will join the Asian Infrastructure Investment Bank (AIIB) in spite of US  lobbying for its allies not the join the Chinese-led initiative. The UK announced its intention to join the AIIB last week.

 

The three EU countries issued a joint communiqué in which they state that they are “keen to work with the AIIB founding members to establish an institution that follows the best standards and practices in terms of governance, safeguards, debt and procurement policies”.

 

It may be noted that France, Germany and Italy have strongly supported the adoption of a comprehensive labour standards safeguard by the World Bank as advocated by the ITUC and Global Unions, and have voiced agreement with the ITUC’s critique of the weak draft labour safeguard currently under consideration by the World Bank, as has the UK. They also supported the adoption of comprehensive labour safeguards by the European Bank for Reconstruction and Development and the African Development Bank, which took place in 2008 and 2013 respectively.

 

A key feature of these safeguards is the requirement that bank-funded activities must comply with the ILO’s core labour standards. One hopes that these governments will show consistency and demand the adoption of similar protections for workers in projects financed by the AIIB.

A detailed article on the European countries’ stance vis-à-vis the new AIIB is in today’s New York Times:

http://www.nytimes.com/2015/03/18/business/france-germany-and-italy-join-asian-infrastructure-investment-bank.html

Best regards,

Peter Bakvis
ITUC/Global Unions – Washington Office
888 16th Street NW
Washington, DC 20006
Tel: (202) 974-8120
E-mail: pbakvis@globalunions-us.org

Dear colleagues,

2015 marks 25 years since the first Human Development Report introduced a new approach for advancing human flourishing. The expression “human development” is likely familiar; it is understood and used in different ways around the world. Measuring the human progress and well-being has itself becoming an industry: last year the Human Development Report Office (HDRO) listed over a hundred indices currently used to measure some aspect, or aspects, of human progress -wellbeing, happiness, peace.

Human development grew out of global discussions on the links between economic growth and development in the 1980s. In previous decades, GDP and economic growth emerged as leading indicator of national progress in many countries, yet GDP was never intended to be used as a measure of wellbeing. In the 1970s and 80s the development debate considered using alternative focuses, including giving greater emphasis on employment, followed by redistribution with growth, whether people had their basic needs met and structural adjustment with a human face.

These ideas helped pave the way for the human development approach, about expanding the richness of human life, rather than simply the richness of the economy in which people live.

One of the more important achievements of the human development approach, as embodied in successive Human Development Reports, has been the growing acceptance that money-metric measures, such as GDP per capita, are inadequate proxies of development. The first Human Development Report introduced the Human Development Index (HDI) as a measure of achievement in the basic dimensions of human development and it has become widely accepted in development discourse.

Over the years, some modifications and refinements have been made to the HDI. Indeed, the critics of the index and their concerns are stimulating refinements to the index and the development of companion indices which help paint a broader picture of global human development. However, the HDI has been subject to criticism that questions its validity. In this context, it is important to understand its nature and what is it and what is not.

The Human Development Index (HDI) was a pioneer and remains one of the – if not the – most influential indices in development debate. It was constructed as a focus measure, or a composite index, and as such concentrates on some basic dimensions of human development: it is an equally weighted average weighted (each dimension given the weight of 1) of a nation’s longevity, education and standard of living (income per capita).

By definition, composite indices provide a single number to synthesize the state of affairs, but cannot provide a comprehensive picture of the state of human development as other measures such as Human Development Accounting does.

Three things prompted to come up with the HDI as measure:

·         First, the HDI captures these basic dimensions of human development: lead a long and healthy life, acquire knowledge and have access to resources needed for a decent standard of living. Without them, many other opportunities remain inaccessible.

·         Second, if only breadth measures of human development are presented, people will revert to GDP per capita for a single measure of development. The HDI changed that outlook.

·         Third, for measuring human well-being, one needs as vulgar but not as narrow a measure like income per capita, which is blind to broader aspects of human lives. The HDI provides a broader measure.

Five observations are therefore quite pertinent about the HDI:

·         First, the HDI is not a comprehensive measure of human development. It just focuses on the basic dimensions but does not take into account a number of other important ones.

·         Second, it is composed of long-term human development outcomes. Thus it does not reflect the input efforts in terms of policies nor can it measure short-term achievements.

·         Third, it shares all the limitations of composite measures. But keeping it simple ensures its acceptability, understanding and predictability.

·         Fourth, the HDI is an average measure and thus masks a series of disparities and inequalities within countries. Disaggregation of the HDI in terms of gender, regions and ethnic groups can be and has been used widely for policy formulation, at the country level.

·         Fifth, income enters into the HDI as a proxy for resources needed to have a decent standard of living - how it is transformed into the health and education dimensions of the HDI.

Any suggested measure for any concept cannot fully capture the richness, the breadth and the depth of the concept itself. This is true of the notion of human development as well. The HDI cannot provide a complete picture of human development in any situation. It has to be supplemented with other useful indicators (a dashboard) in order to get a more comprehensive view. However, as a focus measure, it has been successful for advocacy, for initiating healthy competition among societies and for raising awareness.

If a metaphor is used, human development accounting represents a house and the HDI is the door to the house. One should not mistake the door to be the house and one should not stop at the door, rather one should enter the house.

Best regards,

Selim Jahan
Director
Human Development Report Office
United Nations Development Programme

Dear friends and colleagues,

See the link to my latest column for the CBC on a quick comparison of Canadian and American labour markets.

Thank you

LINK: http://www.cbc.ca/news/canada/manitoba/a-tale-of-2-economies-making-sense-of-u-s-and-canadian-labour-market-data-1.2995923


Louis-Philippe Rochon
Associate Professor
Department of Economics
Room A350
Laurentian University / Université Laurentienne
935 Ramsey Road
Sudbury, Ontario
CANADA P3E 2C6

Director, International Economic Policy Institute
Editor, Review of Keynesian Economics 

Dear colleagues
This update on the Post2015 agenda and the Financing for Development processes may be of interest 
https://www.globalpolicywatch.org/the-2015-declaration-meeting/
Best regards,
Roberto Bissio 
Coordinator, Social Watch International 
http://www.socialwatch.org/

Here is my brief contribution on German debts. 

http://alainet.org/active/81064&lang=es

A deep analysis of inter allied war debts can be read in my latest Arquitectura Financiera Internacional: genealogia 1850-2008, IIEC UNAM, 2014. Eveyone seems to forget European countries have been the ones that have received the most debt reductions in terms of GDP after WWI.

Regards

Dr. Oscar Ugarteche
Instituto de Investigaciones Económicas
UNAM
Oficina I 120
Circuito Mario de ls Cueva. s/n
Ciudad universitaria, Coyoacán
México DF
04510
Coordinador OBELA
www.obela.org

Dear friends,

Here is an interview on the cancellation of German debts and Greece – more materials in CADTM website http://cadtm.org/English.

You may want to subscribe to our newsletter  https://listes.domainepublic.net/listinfo/cadtm-newsletter-en

Best regards

Eric Toussaint
www.cadtm.org
345 Avenue de l'Observatoire
4000 Liège
Belgique

On 9 March 2015 the Independent Expert on foreign debt and human rights, Juan Pablo Boholslavsky, will present a study on "Illicit financial flows, human rights and the post 2015 development agenda of the United Nations", a thematic report on "Financial Complicity: lending to States involved in gross human rights violations" and a report on his fact-finding mission to Iceland to the 28th session of the Human Rights Council in Geneva.  

In the context of the renewed international attention on the financial and social crisis in Greece, Mr. Boholslavsky's  report on his visit to Iceland is of wider interest, showing how the Nordic country dealt with the 2008 banking collapse in an overwhelmingly human rights compliant manner, while pointing at certain gaps that should be addressed.

The interactive dialogue of the Independent Expert at the Human Rights Council with representatives of States and non-governmental organizations on the above reports is scheduled on 9 March 2015 from 9-12 AM, Geneva time (CET),  and can be viewed on the webcast of the Human Rights Council. Information about accreditation for NGOs and National Human Rights Institutions is accessible here.

Below, summaries of key findings of the reports

Illicit financial flows, human rights and the post 2015 development agenda of the United Nations

The interim study of the Independent Expert (A/HRC/28/60) underlines that illicit financial flows generated from crime, corruption, embezzlement and tax evasion represent a major drain on the resources of developing countries, reducing tax revenues and the scope for progressive taxation, hindering development and the rule of law, exacerbating poverty and inequality, and undermining the enjoyment of human rights. According to some estimations developing countries lost US$ 991 billion in illicit financial outflows in 2012 and those flows increased in real terms at a rate of 9.4 per cent per annum over the period 2003–2012. The annual loss is substantially more than the estimated yearly costs of achieving the Millennium Development Goals. The study emphasizes the need for due diligence and due process in the fight against illicit financial flows, for better protection of witnesses and whistle-blowers and for incorporating human rights considerations in the management of returned stolen assets. It concludes with recommendations to States on how the goal of curbing illicit financial flows could be operationalized within the post-2015 development agenda of the United Nations.  The Independent Expert recommends inter alia to:

• Include a goal to reduce illicit financial flows in the final set of sustainable development goals, anchoring that goal in the context of good governance, the rule of law, justice and the duty of States to respect, protect and fulfil human rights;
• Complement such an overarching goal with measurable targets and indicators to ensure accountability for implementation, including specified percentage targets to reduce trade- and tax-based illicit financial flows by 2030;
• Enhance transparency by reducing to zero by 2030: (i) the number of legal persons and arrangements for which beneficial ownership information is not publicly available; (ii) the number of cross-border trade and investment relationships between jurisdictions where there is no automatic exchange of tax information; and (iii) the number of transnational business corporations that do not report publicly on a country-by-country basis.

Read his study on illicit financial flows

Financial Complicity: lending to States involved in gross human rights violations

Does lending to States involved in gross human rights violations help to reduce or does it exacerbate the likelihood for further commission of international crimes? Not an easy question and an issue  that has been discussed controversially at the United Nations since many years, initially when the international community was confronted during the 1960s with racist regimes  in Southern Africa systematically violating human rights. The report (A/HRC/28/59) intends to contribute to a better understanding of when financial support may contribute to, or sustain the commission of, large-scale gross human rights violations by sketching a rational choice framework premised on the incentives of authoritarian Governments and private and official lenders. In the report, the Independent Expert reviews the existing empirical evidence of the relationship between sovereign financing, human rights practices and the consolidation of Governments engaged in gross violations of human rights. Finally, the Independent Expert presents some interim conclusions and invites stakeholders to discuss them.

Read his report on financial complicity

States and international financial institutions can learn from Iceland's response to the banking crisis

To what extent has Iceland fulfilled its obligations to secure economic, social and cultural rights in the aftermath of its recent financial banking crisis? The report of the Independent Expert concludes that Iceland managed the crisis better than many other countries and responded overwhelmingly in compliance with its international obligations. Mr. Bohoslavsky identifies, however, certain gaps that should be addressed. He recommends to further strengthen the legal and institutional framework to prevent repetition of a similar crisis and to pay attention to certain vulnerable groups, in particular highly indebted individuals; tenants living in rented homes; immigrants; and children living in single parent households. The report identifies several good practices on how States facing a financial crisis can prevent negative human rights impacts in the context of economic adjustment programmes. Mr. Bohoslavsky concludes that international organisations and other countries can learn from the particular path chosen in Iceland which included protecting its core social welfare system, efforts to ensure citizens participation in the decision making process, and endeavours to establish political, administrative and judicial accountability.

The country visit report (A/HRC/28/Add.1) will be made available at the website of the Independent Expert  only shortly before it will be discussed at the Human Rights Council on 9 March 2015. His end of mission statement with his preliminary findings is available here.