Africa

Nigeria's history-making curling team needed private funding to secure their trip to the Winter Youth Olympics.

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On the campaign trail: Dr Saveera Parkash, a nominee for the Pakistan People’s Party. She is the first Hindu woman to run in Pakistan's general election Credit: Ashfaq Yusufzai/IPS

By Ashfaq Yusufzai
PESHAWAR, Jan 18 2024 (IPS)

A woman medical graduate from the Hindu community is making waves, as she is the first minority woman to contest the Pakistan Parliamentary election for a general seat, and she does so in the face of deep-rooted religious traditions and wealthy political opponents.

Dr Saveera Parkash, a nominee of the Pakistan People’s Party (PPP) for the February 8 polls, is sure of her victory despite her religion.

“I have been witnessing the support that I am getting from the Muslim-dominated district of Buner in Khyber Pakhtunkhwa province,” Parkash told IPS in an interview. 

“My slogan is addressing issues of pollution, women’s empowerment, gender equality, female representation, and their health issues, in addition to ensuring respect for all religions,” she elaborated.

Born to a Christian mother and Hindu father, she has lived in a Muslim-dominated community; therefore, interfaith harmony is on her wishlist.

“Interfaith harmony is extremely significant because we have seen enmity among different religious sects on flimsy grounds.”

“We have to inculcate a sense of brotherhood among all schools of thought and pave the way for lasting peace in the area. We have to respect our religious places and shun differences, as all religions advocate peace and harmony,” she says.

Candidates in Buner, one of the 36 districts of Khyber Pakhtunkhwa that remained thick with militants from 2007 to 2010, are likely to witness a hard contest as the women and youngsters have shown support for the first-ever minority female candidate.

The Khyber Pakhtunkhwa Assembly, one of Pakistan’s four provinces, has 145 elected members, 115 regular seats, 26 reserved for women, and 4 for non-Muslims.

Pakistan is home to 4.4 million Hindus, which is 2.4 percent of the total population.

Her father, a medical doctor and late leader of the PPP and twice Prime Minister Benazir Bhutto, who was assassinated by militants in December 2007 in the garrison city of Rawalpindi, inspire her, she says.

“While my ideal is Mother Teresa, my main focus will be women’s education. The overall literacy rate is 48 percent, but only 25 percent of females are literate; therefore, I want to spread awareness about the importance of women’s education,” she says.

Additionally, it is very important to end favoritism and nepotism and ensure merit in the appointment of teachers, especially women.

After completing medical education in July 2022, she saw the issues women visiting hospitals faced and decided to enter politics instead of continuing her career as a doctor, as she believed issues needed to be resolved at the policy level.

“We need more women doctors, nurses, and paramedics to encourage female patients to visit hospitals. Currently, the number of female health workers is extremely low, due to which most of the women don’t come to hospitals because they don’t want to be seen by male doctors,” she says.

“My big advantage is that I belong to a middle-class family, and the people will vote for me because I am approachable to my electorate.”

The promotion of women’s rights is her main objective.

“We have to scale up awareness regarding women’s rights to property inheritance and their right to education. I sense victory in the polls, as I know the people listen to me and would reject opponents for their bright future.”

So, how does she feel the run-up to the election is going?

“In our district, 75 percent of voters are under 30, and they are well-informed about the issues they are facing. I may be lacking wisdom and knowledge compared to senior politicians, but my sincerity will lead to my success,” says the 25-year-old, who routinely wears a headscarf.

Because she is trying to reach a young electorate, her campaigning includes the wide use of social media, apart from the traditional approaches of public meetings and house-to-house canvassing.

Highlighting corruption is also part of her election campaign.

At the moment, she is concentrating on a smooth run-up so she can win popular support in her constituency

“Voters in my constituency call me ‘sister’ and ‘daughter,’ which gives me immense strength,” she said.

Parkash said she wanted to follow in the footsteps of her father, Oam Prakash, a retired doctor, and serve the people.

Securing a space for women is vital for development, as they have been suppressed and neglected in all areas.

She said “serving humanity is in my blood” due to her medical background, highlighting that her dream to become an elected legislator stemmed from having experienced poor management and helplessness in government hospitals as a doctor.

Most people in the area endorse her candidacy, regardless of her Hinduism or political affiliation. Voters appreciate her bravery for challenging traditional policies

The Election Commission of Pakistan makes it mandatory for all political parties to award 5 percent of seats to women in general seats.

Political analyst Muhammad Zahir Shah, at the University of Peshawar, said that Parkash has created history by contesting the general election.

“We have been seeing women becoming members of the assembly on reserved seats. They don’t contest elections but are nominated by parties on the basis of the seats they win in the election,” Shah said.

In the past, some women have fought elections, but they were Muslim; therefore, they don’t draw as much media and public attention, but the case of Parkash is unprecedented.

She is well educated and belongs to the Hindu community while standing for vote in an area where 95 percent of the voters are Muslims.

“She is contesting on the PPP’s ticket, which isn’t a popular political party, but it seems that she will make her presence felt during the electioneering,” Shah said. Already, she has hit headlines, and if the election takes place in a fair and transparent manner, there is a greater likelihood that she will emerge victorious,” he said.

IPS UN Bureau Report

 

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An activist raises a mock blood-stained hand and shows a mock hand-shape bruise on her face during a protest on the occasion of the International Day for the Elimination of Violence Against Women. From Italy to South Africa, femicides are increasing. To counter this, we must confront ingrained norms and demand swift legal action. Credit: DPA picture alliance

By Theresa Beckmann
BRUSSELS, Belgium, Jan 18 2024 (IPS)

‘Per Giulia e per tutte’ (‘For Giulia and for all’) echoed through the streets of Italy in mid-November 2023. Thousands of women, activists and supporters gathered to protest and show solidarity with the 22-year-old student Giulia Cecchettin, who was killed by her ex-boyfriend on the night of 11 November 2023.

The outrage over the murder of the young student unleashed a wave of protest that was audible far beyond the country’s borders in the weeks after the incident.

Browsing through the page Women for Change on Twitter/X triggers a wave of emotions which constantly sways back and forth between disbelief, grief and anger. The South African NGO is dedicated to women’s rights and documents all the cases of murdered women in the country. South Africa’s femicide rate is five times higher than the global average; on average, nine women were murdered there every day in 2022.

A quick glance reveals a seemingly never-ending series of posts titled ‘In Memory of’, each featuring a portrait of a smiling women — a tribute to all the woman and girls whose lives were abruptly cut short. One of them is Nombulelo Jessica Michael, a social worker who was attending a gender-based violence and femicide (GBVF) case in court on the last day she was seen alive.

The deaths of Nombulelo and Giulia account for a series of murders of women all over the world — femicides. The term describes the most extreme form of gender-based violence. In 2022, the UN registered 89 000 cases of intentional killings of women and girls worldwide. Fifty-five per cent of these murders are committed by (former) intimate partners or perpetrators from the victim’s own environment.

Despite general homicide rates decreasing, femicide cases have been rising continuously in the last two decades. And still, these figures only paint a fragmented picture of a blunt reality: a significant number of femicide victims (around 40 per cent) remain unaccounted for in the UN report, as they are not categorised as gender-related killings due to variations in criminal justice recording and investigation practices across nations.

With the start of the new year, it is high time to highlight the pressing need for continuous advocacy initiatives and policy implications aimed at promoting societal transformation and confronting the fundamental factors contributing to gender-based violence.

But the challenge requires a multifaceted approach that acknowledges the intersection of underlying power dynamics in the form of a patriarchal society, racism and structural inequalities.

Dismantling the roots

Giulia and Nombulelo were two different women, on different continents, who became victims of the same alarming global crisis of gender-based violence, affecting women and girls in diverse cultural, economic and political contexts.

In patriarchal societies, the omnipresent grip of traditional gender norms reinforces a culture where violence against women is normalised. This norm transcends borders and adapts to different cultural contexts while maintaining its oppressive nature.

Those stereotypes and prejudices continuously foster expectations of femininity and masculinity, weaving dangerous narratives of victim blaming. As a result, it is common for the public discourse surrounding gender-based violence and femicides to be marked by the inappropriate behaviour of a young woman who is drinking alcohol and is walking home alone at night, rather than being centred on expressions of grief, condolences and righteous indignation.

In this regard, media portrayals and narratives must shift and tell the stories from the victim’s point of view, avoiding stylistic instruments drawing from love tragedies and sensationalism.

But what other causes are there for the rise of femicide cases? The Covid19 pandemic, which forced people to stay locked up at home, intensified the extent of violence against women immensely. It also pushed people into financial uncertainty and economic distress, which became a crucial driving factor for gender-based violence.

Government authorities, women’s rights activists and civil society partners worldwide were reporting significantly increased calls for help to domestic violence helplines during that time. Disrupted support systems, the intensification of pre-existing tensions, overwhelmed healthcare systems and restricted mobility made it challenging for victims to seek help and support.

More than this, food insecurity is also intertwined with women’s exposure to domestic violence. The economic roles of women, especially as full-time unpaid caregivers, are associated with a higher likelihood of experiencing violence, as highlighted in a UN report.

Additionally, women with income experience a greater sense of safety and reduced perception of violence (except for those who out-earn their partners) — portraying the harmful power dynamics perpetuating femicides and gender based-violence and their connection to women’s economic dependence.

Consequently, we need to prioritise initiatives that enhance financial independence, providing women with the resources and support needed to escape abusive situations, such as shelters and other help centres: in 46 European countries, 3 087 shelters provide 39 130 beds for women and children, but because of capacity and space issues, it is impossible to provide accommodation for all those seeking help.

When looking at the emergence of femicide and gender-based violence, it is also important to acknowledge that racism amplifies the vulnerability of women and girls — particularly those from marginalised communities. In the context of femicides, racial dynamics intersect with gender-based violence, creating compounded challenges for women of colour.

The Femicide Census, which documents women killed by men in the UK, reveals the ethnicity of only 22 out of 110 victims. This lack of data in the documentation of the victims’ ethnicity leads to insufficient conclusions and examinations, which disregard cultural circumstances, influences, as well as intercommunal disparities.

Experts suggest that women from ethnic minorities and indigenous groups may encounter discrimination due to factors like ethnicity, language and religion. This bias puts them at higher risk of various adversities, such as limited access to healthcare or higher risks of experiencing violence by strangers.

Finally, many women of colour fear engaging with the police in the first place due to concerns about discrimination or lack of support, hindering effective strategies to address the vulnerabilities faced by marginalised communities.

It is imperative that these issues extend to law enforcement. Legal and policy responses cannot be blind to structural inequalities that disproportionately affect marginalised communities. It is crucial to ensure that activist groups, NGOs overseeing femicide data processing, along with family members remembering victims and other stakeholders dismantling harmful narratives, gain increased visibility in the debate.

 

Legal change in progress?

From Italy to South Africa to America, in recent years there have been major efforts by feminist movements, NGOs and international organisations to put femicides on the political agenda. But how successful have these movements been?

As a study by the European Institute for Gender Equality (EIGE) suggests, the prevention of femicide is closely linked to legal responses to domestic violence. A societal rethink makes up only one part of the equation — legal consequences and political implications must follow.

When looking at Italy’s recent implementations, one strong deficit becomes apparent immediately: the government’s spending on countering gender-based violence was more than doubled in the last decade, however, the femicide rate has remained stable. The reason for this is that a large amount of money is put towards the treatment of the victims instead of the prevention of femicides.

In South Africa, the opposite has happened: the South African National Assembly recently passed the Gender-Based Violence and Femicide Bill 2023. The legislation aims to enhance the criminal justice system’s response to gender-based violence through improved law enforcement, police training and legal processes.

At first glance, this seems to be a progressive implementation, however, the initial optimism of advocates, supporters and activists was quickly dampened: the South African Social Development Minister Lindiwe Zulu squandered 100 million rands meant to assist survivors of gender-based violence by mismanaging the allocated money and transferring funds to nonfunctional civil society organisations without GBVF mandates — an example for the gap between legislative intent and effective implementation in reality.

However, one thing is clear: we should never stop telling the stories of Giulia and Nombulelo and all the other women and girls around the globe who were brutally murdered. Their stories should lead to collective action, which demands not just sympathy but systemic change and constantly amplifies the voices of the silenced.

Theresa Beckmann works at the Friedrich-Ebert-Stiftung EU Office in Brussels in the editorial team of International Politics and Society.

IPS UN Bureau

 

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Ghanaian-Scottish architect and educator Lesley Lokko receives the Royal Gold Medal for Architecture.

Zambia and DR Congo draw 1-1 in Group F as the opening round of games at the 2023 Africa Cup of Nations come to a close.

A blast in a Nigerian city has killed two people and injured 77 others.

Pre-tournament favourites Morocco open their 2023 Africa Cup of Nations campaign with a convincing 3-0 win over 10-man Tanzania.

Paul Kagame tells the BBC he could return money if no asylum seekers are sent to his country by the UK.

Ernest Bai Koroma has been charged with treason after being linked to a failed coup last November.

President Azali Assoumani is re-elected with 63% of the vote, amid an extremely low turnout.

Psychiatrists will assess whether the man accused of 400 deaths is fit to stand trial.

Two people are killed and 77 injured when explosives illegally stored in a residential area ignite, officials say.

The shocking killing of student Rita Waeni, 20, has ignited an anti-femicide campaign in Kenya.

The plane was carrying Ethiopian officials to the self-declared republic of Somaliland.

Angola's public prosecutor accuses Isabel Dos Santos, the former president's daughter, of 12 crimes.

Men on camels and donkeys travel through a dust storm in the desert near the western city of Mao, in the Kanem Region of Chad. Credit: UNICEF/UNI82205/Holt

By Sudip Ranjan Basu, Chen Wang and Monica Das
BANGKOK, Thailand, Jan 17 2024 (IPS)

As the world is still gearing up to welcome 2024, let us find a moment to reflect on some of the key trends of the past year and pursue now to embrace the path towards hope and promise for everyone, everywhere.

Deepening global inequalities are having enormous socio-economic implications across countries. Increasing income and social disparities are spreading around regions. Growing intensities of climate induced natural disasters, the uneven speed of post-pandemic recoveries, and cost-of-living crises from conflicts and geopolitical tensions are exacerbating inequalities and poverty traps globally.

The changing distribution of economic benefits vis-à-vis the rising prices of food and fuel are causing social unrest and protests. Citizens are voicing their frustration not only in the streets of capitals but through exponential engagement on social media platforms.

With the intensification of various external shocks, and the lack of economic opportunities for accelerating growth and productivity surges, multidimensional poverty indices are on rise. The inequality-poverty nexus is contributing to a new form of uncertainty for disadvantaged households.

A family displaced by prolonged drought in Ethiopia now live in a makeshift tent in Mogadishu, Somalia. June 2023. Credit: IOM/Muse Mohammed

Intensifying course of climate change

Intensifying hazards caused by climate change, such as floods, tropical cyclones, heatwaves, droughts and earthquakes, have impacted agricultural outputs and industrial sectors, especially through decreasing productivity growth and falling real wages. The widening gap between rich and poor in rural and urban areas has also been linked to extreme weather events due to the increasing frequency of natural disasters.

These inequalities are further aggravating extreme poverty, creating the vicious nexus of climate-disaster-inequalities among vulnerable groups.

Evidence from around the world indicates that climate change is likely to impact more severely on vulnerable groups and coastal communities, because they are more exposed to the uncertainties of weather patterns. Lack of adaptive capacity are often constraining the ability of these communities to build resilience and cope with the severity of these environmental shocks.

Widespread incidence of climate migration from low- to high-latitude areas and social mobility are increasingly impacting the social fabric of small island developing States and other developing economies.

With the exodus of young and skilled labour force, transfers of income and the wealth gap will further worsen inequalities in communities, raising concerns of greater socio-economic uncertainties.

From Fiji to Ethiopia, Bangladesh to Brazil, the exacerbation of inequalities due to climate change has been impacting socio-economic prosperity. Growth uncertainties are causing extreme poverty to increase, while causing hardship and hunger for households in rural areas.

Varying scales of COVID-19 pandemic

Socio-economic polarization has been on the rise since the global outbreak of the COVID-19 pandemic. Due to differentiated impacts of national lockdowns, pandemic restrictions and vaccination measures have had adverse impacts on the existing inequalities and multidimensional poverty indices.

As economic development stagnation persists, rural areas have seen rising impacts of extreme poverty and income divergence across households, leading to new episodes of income divergence within countries.

The post-COVID 19 recoveries are uneven. Rising levels of unemployment and stagnating real wages remain major indicators of corresponding economic growth deceleration. The differentiated policy measures to stabilize labour market distortions, social protection systems and sectoral productivity surges have not always achieved the desired outcomes in developing countries.

According to the labour force surveys in various countries, the majority of workers have been engaged in less paid work due to lack of dynamism in the labour market. Evidence suggests that the changes in work style and availability of types of jobs as well as their skills and profiles aggravate the income disparity within urban centres.

From several Latin American to African countries, the pandemic-induced policy measures have differently elevated the risk of vulnerability for the manual labor force. Similarly, the studies have shown that young, low-income and self-employed workers including women with limited education, have suffered greater job losses and earnings reductions than other groups in the workforce in the UK, USA, China and India, among others.

Changing forms of conflicts

Conflicts also go beyond borders, causing immeasurable human suffering on the global scale. With the volatility and uncertainties around supply chains, food and fuel prices spiral. Cost-of-living crisis spreads around countries as governments lose fiscal space for developmental expenditure, while debt burden mounts.

Conflicts cause people to lose hope and opportunities from East to West, North to Southern countries. With the lack of rule of law and property rights, households and communities fall into poverty traps, changing the face of socio-economic disparity.

As these conflicts are prolonged, countries often fail to overcome the existing structural constraints, maintain production streams, and improve lackluster infrastructure. A higher risk of falling into poverty traps and increasing scale of disparities is then the inevitable outcome. The polarization fears and lack of trust are now a reality.

Looking ahead

Today, as we look back at 2023, there is no doubt that in the end, common aspirations and outlooks remain our best hope to chart a new course to advance the Sustainable Development Goals. Evidence of successful policy coherence will provide valuable opportunities for policymakers to unite their priorities and lay the foundations for breakthroughs.

Sudip Ranjan Basu is Deputy Head and Senior Economic Affairs Officer; Chen Wang is Professor, Institute of Finance and Economics, Shanghai University of Finance and Economics, China; Monica Das is Associate Professor, Economics Department, Skidmore College, New York

IPS UN Bureau

 

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Two years after the major attacks by non-state armed groups, a considerable number of forcibly displaced people have returned to Palma. Credit: UNHCR

By Kevin Humphrey
JOHANNESBURG, Jan 17 2024 (IPS)

There is cautious optimism regarding the conflict that has been raging in northern Mozambique, largely in the province of Cabo Delgado, since 2017. There are encouraging indications that the Islamic State (IS)-driven insurgency has significantly decreased thanks to the deployment of the Mozambique Defense Armed Forces (FADM), Southern African Development Community (SAMIM) forces, and a contingent of Rwandan troops (RSF).

Leleti Maluleki, a researcher at Good Governance Africa, told IPS: “With regards to the current state of the conflict, people are slowly moving back or returning to their villages and communities. It’s a sign of progress being made by the troops, and we hope it’s a sign of peace.”

There had been a decrease in the number of attacks by insurgents. 

“That’s a good thing as well, but it does not mean that the insurgency is over. We need to remember that there were stories of insurgents infiltrating the communities, so they are still among the people; they might have radicalized certain individuals, and they might have recruited some citizens. But we are seeing fewer and fewer attacks on a daily basis.”

The insurgency has claimed over 4,000 lives and displaced 946,000 since it started. According to a report from the United Nations Security Council published in February 2023, the number of IS fighters in the field has decreased from a peak of 2,500 (prior to SAMIM and the RSF joining the fight) to roughly 280.

Last year, Vladimir Voronkov, Under-Secretary-General of the Office of Counter-Terrorism, said in August 2023 that counter-terrorism initiatives in Egypt, Mozambique, and Yemen had significantly limited the insurgents ability to conduct operations.

He warned, though, that “force alone cannot lead to changes in the conditions conducive to terrorism,” noting that it can fuel more violence and aggravate grievances exploited by terrorists.

At the same meeting, Domingos Estêvão Fernandes, Deputy Permanent Representative of Mozambique to the UN, pointed to the rising spread of terrorism in Africa, where fatalities linked to Al-Qaeda and Da’esh reached more than 22,000 over the past year—representing a 48 percent increase over 2022.

Fernandes it was important to address poverty, inequality, social exclusion, and discrimination based on religion and culture to address insurgency and recognize the risk of the misuse of emerging technologies.

He pointed to the achievements of the deployment of the Southern African Development Community (SADC) mission in Mozambique.

Amanzi Amade Bacar is a fisherman who has fled and returned several times from and to his house in Bagala, Mozambique. The 39-year-old husband and father hopes to return to his home and his original livelihood. Credit: UNHCR

“We must ensure predictable, flexible, and sustained funding for African Union peacekeeping operations,” Fernandes said, adding that government agencies and defense and security forces must partner with local communities to provide early warning systems.

Maluleki added that a new challenge is the insurgent’s use of improvised explosive devices (IEDs), a tactic that works when the insurgents numbers are dwindling, which means decreasing the likelihood of insurgents getting up close to security forces. The use of these causes panic among civilians, which leads to further destabilization of the region regarding displaced persons and refugees.

When security forces reportedly killed Ibn Omar, the purported IS leader, and two of his followers, the anti-insurgency campaign also gained momentum. Mozambique’s president, Filipe Nyusi, recently made an announcement to this effect.

In terms of the future, the Southern African Development Community (SADC) heads of state at a summit in July 2023 laid plans for SADC forces to begin to leave northern Mozambique by December 15, 2024, and to complete the withdrawal by July 15, 2025. It was also noted that for this to happen, there was an urgent need for Mozambique’s defense forces to be capacitated to a degree where the removal of SADC troops would not compromise the gains of the past few years. Training and other help coming from the European Union and the United States to beef up the Mozambican forces were also mentioned at the summit.

Two years after the major attacks by non-state armed groups, a considerable number of forcibly displaced people have returned to Palma. Credit: UNHCR

Since the beginning of the insurgency, the UN High Commissioner for Refugees (UNHCR) estimated that one million people had been displaced in the region. More recently, the International Organization for Migrants (IOM) reported that in September and October 2023, about 8,000 Cabo Delgado residents had become displaced.

“When it comes to the issue of displaced individuals, a lot of people lost their homes and ran away for safety. People displaced by the conflict went to neighboring, safer communities. Host communities are faced with overcrowding, and basic services are under severe pressure so the security situation needs to improve so that more people can return to their villages and relieve the burden on these host communities,” said Maluleki

This increase in displaced persons occurred in the run-up to local government elections in the area and also when the €20 billion liquefied natural gas (LNG) project, put on hold due to the conflict in the region, was being considered for being given the go-ahead. Fortunately, the October 11, 2023, municipal elections in Mocimboa da Praia went ahead, with four political parties taking part.

Nyusi has said it is safe to restart the Cabo Delgado liquefied natural gas (LNG) project that was halted in April 2021 after rebel attacks on civilians.

“The working environment and security in northern Mozambique make it possible for TotalEnergies to resume its activities at any time,” Nyusi said. TotalEnergies confirmed it was working on restarting the project.

There are, however, still concerns, especially for the civilian population.

“The deployment of troops was primarily in two districts, and this is concerning because these are the districts where the government has its own interests because they are where the LNG project is. Only two of the five or six districts that the insurgents heavily targeted have received adequate security. All districts affected by the conflict need to be secured so that we can reach a true level of peace and stability and address the root causes of the conflict,” said Maluleki.

IPS UN Bureau Report

 

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By Jomo Kwame Sundaram
KUALA LUMPUR, Malaysia, Jan 17 2024 (IPS)

World Bank aid encourages governments to enable illicit financial outflows to offshore tax havens by reducing capital controls, thus draining precious foreign exchange and government resources.

Aiding elite wealth
Aid disbursements to highly aid-dependent countries coincide with sharp increases in bank deposits in offshore financial centres known for banking secrecy and private wealth management.

Jomo Kwame Sundaram

Using Bank for International Settlements (BIS) data, Jørgen Juel Andersen, Niels Johannesen and Bob Rijkers found trends suggesting wealth accumulation abroad by national elites coinciding with World Bank aid disbursements.

Capital outflows follow aid inflows apparently captured by ruling politicians, bureaucrats and their cronies. In the 22 most World Bank aid-dependent countries, aid disbursements coincide “with increased deposits in foreign bank accounts in tax havens”.

National elites capture World Bank aid to poor developing countries. Such ‘leakages’ came to 7.5% of inflows, rising with aid-reliance. Earlier, ‘petroleum rent’ leakages to secretive offshore tax havens were estimated at 15%.

A modest share of all aid, World Bank disbursements averaged over 2% of low-income countries’ GDPs yearly. For Bank disbursements of at least 1% of GDP, leakages from 46 countries increased deposits in havens by 3.4%. But at a 3% of GDP threshold, leakages from seven countries rose to 15%!

Elites capture aid
The conventional wisdom is that aid promotes economic development in the poorest countries, while a few disagree. Many believe aid effectiveness depends on institutions and policies in receiving countries, with some warning corrupt elites may capture aid.

Many suspect elites who capture aid, or funds freed up by aid, hide their ill-gotten gains in private accounts in tax havens. Some countries receiving foreign aid are quite corrupt, with aid inflows captured by ruling politicians and their cronies.

There is much evidence that very high aid inflows foster corruption, with development projects failing due to greedy elites. The poorest countries supposedly receive the most aid but are often the worst governed. The study shows World Bank aid has been no better than others, further burdening poor countries and people.

Its data does not allow identification of those involved or the mechanisms used. Nonetheless, it concludes “the beneficiaries … belong to economic elites” with other research showing “offshore bank accounts are overwhelmingly concentrated at the very top of the wealth distribution”.

Illicit outflows enabled
Such aid capture by ruling elites helps explain its diversion abroad, how such funds end up in tax havens, and related surges in illicit outflows. Hence, large increases in offshore haven bank accounts coincided with aid disbursements.

Such abuses get worse when countries are more corrupt and have less effective checks and balances. Unsurprisingly, there are larger outflows to havens when projects fail, suggesting elite responsibility for such failures.

Conversely, there are less outflows to havens when procurement is from local contractors. When taxes can easily be evaded without using offshore accounts, and such abuses are unlikely to be penalised, outflows to havens become unnecessary and decline.

Foreign aid has also been used to get governments to reduce capital controls. Although assured by the International Monetary Fund’s Articles, the Bretton Woods institutions have eroded them since the 1990s. They claim doing so will ensure net inflows when all evidence suggests the contrary.

Reducing capital controls enables and boosts illicit capital outflows by reducing exit barriers. Such outflows have greatly exceeded World Bank aid inflows, draining precious government foreign exchange resources.

Study underestimates outflows
The study tries to minimise other factors influencing aid inflows and financial outflows. It excludes observations when wars, natural disasters, financial crises, oil price hikes and exchange rate volatility triggered such flows.

The study only covers World Bank aid leakages diverted to offshore tax havens. Spending on real estate, luxury goods, pet projects, and outflows using offshore intermediaries who help “hide and launder assets” are also not counted. Besides ignoring such outflows, it also rules out other possible causes.

International Consortium of Investigative Journalists’ leaked data on offshore corporations, especially the Panama Papers, showing many secretive offshore havens used to hide illicit outflows, especially in Switzerland and Luxembourg.

Financial transparency has improved significantly, with more information on offshore financial centres from 2009. But more transparency has not stopped illicit outflows, including aid-derived wealth accumulation in havens.

Unsurprisingly, more corrupt countries, less local procurement and more failed projects have generated more outflows. But the study suggests more donor monitoring and control may have lowered leakage rates for aid compared to natural resource extraction.

Adding insult to injury
It is bad enough for the World Bank to enable the theft of scarce financial resources by influential elites. Worse, such enabling reforms have been required or advised by the Bank despite prior knowledge of their likely consequences.

To add insult to injury, the poor countries themselves are blamed for such abuses and their consequences. Unsurprisingly, the beneficiary elites are the political and economic allies of those who control the Bank and its policies.

These same elites have incurred much debt in the names of their countries and people. But much market-based debt dried up as the US Fed, European Central Bank and others sharply raised interest rates from 2022.

Thus, most poor countries face punishing market credit terms in the face of massive international economic contractions due to policies pursued by the US and its European allies.

IPS UN Bureau

 

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