Africa

A landmark United Nations report is calling on governments to declare remittance transfer an essential service. Photo by Christine Roy on Unsplash

By Alison Kentish
UNITED NATIONS, Dec 9 2020 (IPS)

On Dec. 2 Gabriel Arias, 42, left a Washington Heights, New York, money transfer agency after sending money home to the Dominican Republic. For the past eight years, every fortnight he would come to this branch at 171st street after getting paid from his construction job. But things are different this year and he worries about his family back home. Arias lost his job in May, amid heightened COVID-19 restrictions in the state. He told IPS he has tried to work some odd jobs, but has barely earned enough for his monthly apartment rental. This early December visit to send money home was only his second since June.

“It has been hard because for a long time this year, I had no work. I came here speaking no English. I worked hard. Learned to speak and I took care of my mother and the family in the Dominican Republic. I had no job, no work since the COVID,” he told IPS.

Arias is not alone. A landmark United Nations report is calling on governments to declare remittance transfer an essential service and ensure access to humanitarian assistance, legal services and social protection for migrants and the displaced, as COVID-19 shifts the dynamics of global migration and hunger.

The report entitled “Populations at Risk: Implications of COVID-19 for Hunger, Migration and Displacement” is the first joint global report by the International Organisation for Migration (IOM) and World Food Programme (WFP) and analyses food security trends in the world’s migration hotspots during the pandemic. It warns that COVID-19 and measures taken to contain its spread have disrupted human mobility patterns, the consequences of which could been seen for years to come.

Earlier this year, countries across the globe instituted various tiers of entry requirements. According to the report, while those restrictions resulted in significantly reduced international migration in the first months of the pandemic, the ensuing dip in unemployment and food security led to a desperate need to search for work elsewhere – and a spike in migration due to necessity.

One of the areas hardest hit by the pandemic and subsequent lockdowns involves remittances. Globally, migrant remittances are a financial lifeline for around 800 million people. World Bank figures put remittances to low and middle-income countries (LMICS) at over $550 billion in 2019. For more than half of these countries, funds sent by migrant workers to their relatives in their home countries account for over 5 percent of gross domestic product. However, remittance flows have plunged drastically in 2020 and according to the report, over 33 million people are at risk of going hungry as part of the socio-economic impact of COVID-19.

“If efforts are made to channel remittances properly and ensure as well that you reduce the financial costs, this would have a greater impact on development. The idea is also that good management of the remittance services can help to speed up the recovery from the crisis,” IOM Senior Emergency and Preparedness Officer Rafaelle Robelin told IPS. 

With remittances to LMICS expected to fall by about $100 billion in 2020 and 495 million full time job losses in the first quarter of the year, the report’s partners say it is possible that many migrants are sacrificing their own consumption and other needs, in order to send money to loved ones in their home countries. The report states that this is not a sustainable means of supporting families in the medium to long-term. It is also bad news for countries heavily dependent on remittances. 

“Coupled with the 32 percent drop projected for foreign direct investments (FDI) in 2020, contractions in the prices of natural resources and a significant decrease in tourism revenues, the drop in remittances will likely impact the financial stability of numerous countries….poverty, food security, nutrition, health and educational attainment are all being directly impacted by mobility restrictions and the decline in remittances,” the report said.

While it confirms the importance of migrant work and its contribution to the economies of home countries, the report also highlights the inherent vulnerabilities that migrant workers face and notes that the pandemic has exacerbated those risks.

“It has been very clear since the onset of the crisis, that the impact of COVID on migration and mobility would be huge,” said Robelin, adding that, “migration has a positive impact from the remittance angle. The fact that many people lost their jobs who migrated for development means, means that in the long term, those benefitting from the positive impact of migration, may suffer.”

The IOM official says restriction of movement may have also pushed people to move under dangerous circumstances. Mobile and displaced populations also face new challenges such as increased exposure to work-related abuse and exploitation, the risk of losing residence status, the lack of funds to buy hygiene items and difficulties accessing COVID-19 tests, as well as restrictions on their general freedom to travel back and forth to their country of origin.

The IOM and WFP predict that partial or full lifting of travel regulations will result in more people leaving home to find work in order to feed their families. They are calling for well-governed migration to be a cornerstone of the global response to COVID-19. They believe that making remittance transfer an essential financial service can help families to meet their food and other needs. They are also advising the global community to ensure migrant access to health services including immunisation and mental health support. The partners are also recommending that government recognise the significant role played by migrants by ensuring they have access to social protection initiatives.

Some governments have implemented COVID-19 relief packages. They vary across countries and regions. IPS spoke to a family in Brooklyn, New York, who has opted to send home barrels of groceries, household and hygiene products to their loved ones in Saint Lucia. Lawmakers on the Caribbean island went to parliament in June and amended a bill that provides for late November to early January duty free concessions on barrels of items for household use. They announced that those tax relief measures would now extend from June 2020 to January 2021, in order to assist the most vulnerable and the thousands of Saint Lucians who lost their jobs.

“We took advantage of the duty-free and were able to send food home. We sent cleaning products and items like hand sanitisers, thermometers, masks and months of supplies that are expensive or not available back home,” one family told IPS.

Recovery from the COVID-19 pandemic is expected to be much slower than the 2009 global financial crisis. The report’s joint analysis has concluded that an effective response and recovery plan must take into consideration the link between food security and migration.

Related Articles

• The Immense Cost 200 Million Migrant Workers Pay to Rescue their Families
• Coronavirus Leads to Nosedive in Remittances in Latin America

The post Drop in Remittances – a Financial Lifeline for 800 Million People – Could Impact Financial Stability of Numerous Countries appeared first on Inter Press Service.

Excerpt:

The International Organisation for Migration and World Food Programme’s first joint publication says restrictions to curb the spread of COVID-19 have limited human mobility and left 33 million remittance-dependent people facing hunger.

The post Drop in Remittances – a Financial Lifeline for 800 Million People – Could Impact Financial Stability of Numerous Countries appeared first on Inter Press Service.

School children in the Eastern Highlands Province of Papua New Guinea. Credit: Catherine Wilson/IPS

By Cameron Diver
NEW CALEDONIA, Dec 9 2020 (IPS)

Climate change and human rights are two key issues in international development and their interaction is increasingly in need of focus at national, regional and international levels. In the Pacific, where the 22 Pacific Island countries and territories are on the front line of both climate ambition and the ongoing effects of the climate crisis, climate change is recognised as the region’s single greatest threat. Urgent climate action is consistently called upon to protect the interests of youth and the most vulnerable populations, together with preserving the ‘shared needs and interests, potential and survival of our Blue Pacific and this great Blue Planet’.

At the Foreign Ministers’ Meeting of the Pacific Islands Forum in October 2020, member countries endorsed the proposal to seek the appointment of a Special Rapporteur on Human Rights and Climate Change by the June 2021 session of the UN Human Rights Council.

Small island developing states, including many members of the Pacific Community, are particularly vulnerable to the effects of climate change due to their reliance on the ocean for resources, transportation and livelihoods. Shifts in biodiversity distribution as a result of climate change can have a devastating impact on coastal communities who are unable to adapt their way of living to compensate for the diminished resources and opportunities. For atoll nations, where thousands of people live on land that rises to a maximum of four metres above sea level, a rising ocean threatens their very existence. In this context, climate change has a profound impact on a wide variety of human rights, including the rights to life, self-determination, development, food, health, water, sanitation and housing, while also disproportionately affecting already marginalised groups. It is then, no surprise that the first intergovernmental statement to explicitly recognise that ‘climate change has clear and immediate implications for the full enjoyment of human rights’ was adopted in a small island developing state, the Seychelles, in 2007.

Cameron Diver

However, there is currently no specific legal right to seek refuge in another country due to climate change-induced displacement. International instruments, such as the UN Refugee Convention, apply generally to groups facing persecution from State or non-State actors but have not yet been legally extended to cover situations where people are seeking refuge in another country due to the onslaught of climate change. And while there is soft law reflecting human rights principles that can guide protection in this area for internal migration, such as the 1998 Guiding Principles on Internal Displacement, and a considerable amount of work on potential legal solutions, the question is, given the current reality and projections around climate migration, if the law alone is sufficient to address the multifaceted nature of these issues.

The interface between climate change, human rights and migration would appear to require an integrated approach taking into account, among others, political, social, cultural, environmental and legal aspects. In the context of the climate crisis, it requires a whole-of-society approach, together with strong international cooperation, to identify and implement solutions that protect the rights of all persons, regardless of nationality. For both displaced populations and those that welcome them, these solutions will need to anticipate preservation of rights such as those related to culture, identity, freedom of religion, access to employment, land and resources, or self-determination. Should island countries become uninhabitable, they will need to anticipate the extreme hypothesis of a State in climate-enforced exile and the complex ramifications for sovereignty, nationhood and issues such as sovereign rights over land-based and marine natural resources.

Due to their particular vulnerability to global warming, Pacific Island countries and territories are regarded by some as ‘a barometer for the early impacts of climate change’, with studies projecting that between 665,000 and 1.7 million individuals could be displaced due to the ongoing effects of climate change by 2050. In other words, this many people in the Pacific Islands alone, through no fault of their own, may be driven from their ancestral homes, their sacred places, the land and oceanscapes to which they are so deeply bound and of which they are the traditional custodians.

While developing legal frameworks to recognise the status and protect the rights of those individuals remains essential, it should not be seen as the panacea. In reality, there must be a global understanding of the fact that greater mitigation and adaptation efforts are not only critical to stem the tide of biodiversity loss, keep global warming under 1.5°C, or improve the health of the ocean. They will also very directly enable populations in the Pacific region, small island developing states around the globe and many others to remain on their islands, on their land, in their homes and with their families. Personally, I can think of no better way to respect and protect their human rights, cultures, identities and sovereignty.

 

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The post Climate Action for Human Rights appeared first on Inter Press Service.

Excerpt:

Cameron Diver is the Deputy Director-General of the Pacific Community (SPC).

The post Climate Action for Human Rights appeared first on Inter Press Service.

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Posters of rival tickets for mayor of Depok, a commuter city 40 minutes by train south of Jakarta where many of its 2.4 million residents work.Credit: Warief D. Basorie

By Warief Djajanto Basorie
JAKARTA, Dec 8 2020 (IPS)

In just over a day, on 9 December, Indonesia holds 270 simultaneous local elections for executive office. This involves nine of the republic’s 34 governors, 224 of 416 bupati (district chiefs) and 37 of 98 mayors. The polling was initially scheduled for 23 September but the independent KPU (General Elections Commission) put the date back to 9 December due to the Covid-19 pandemic.

In this batch of local polling, 105 million Indonesians aged 17 and above in this nation of 268 million people are eligible to vote.

Like the national election for president, local office elections are rigorously contested since the end of the 32-year authoritarian rule of President Soeharto in 1998.

During his prolonged regime, Soeharto appointed the country’s governors, mayors and district chiefs to maintain unopposed power through office loyalty. Many active military officers got such appointments in line with the-then dwifungsi (dual function) concept of the armed forces. Uniformed personnel concurrently had a military and a social-political role.

In post-Soeharto Indonesia, with the passing of a democratic election bill, the president no longer makes such arbitrary appointments. Moreover, the dual-function practice has ceased. Now, the run for legislative and executive public office is highly competitive.

Dynasty

What has aroused attention in this election-cycle is not so much how the coronavirus scourge affects the electoral process but more on who are in the running. The move of President Joko “Jokowi” Widodo’s first son to enter the political arena has drawn public attention and apprehension.

Gibran Rakabuming Raka, the elder of Jokowi’s two sons, is running for mayor in Surakarta, Jokowi’s hometown in Central Java and where he himself was a mayor.

At present there are 117 heads and deputy heads of local government in Indonesia tied into a dynasty-making relationship.

The Constitutional Court permits politics by affinity, notes Khoirunnisa Nur Agustyati, executive director of election watchdog Perludem, the Association for Elections and Democracy.

“What must be done is that its bad effects must be prevented where the space for competition becomes unequal,” she stated.

Banner of Depok City elections commission calls on residents to vote for mayor 9 Dec 2020. Top middle line in Bahasa Indonesia reads: Let’s vote for Depok City. Credit: Warief D. Basorie

“It is not seldom when long-time party cadres must be bested by those who have a kinship with party elite. For sure, this is unhealthy for democracy. Internal party reform must be undertaken to allow for recruitment with integrity,” she asserted.

“The meritocracy principle with the aspects of worthiness and competence is an absolute condition to back a candidate of quality,” states political communication scholar M. Jamiluddin Ritonga at Esa Unggul University.

Party cadre development is important. Give at least 10 years before a party cadre becomes a candidate for an executive or legislative office, insists political communcation lecturer Emrus Sihombing at Pelita Harapan University.

Political corruption

Corruption is on watchdog radar screens.

Candidates may need as much as USD1.5 million to USD7.5 million for their individual campaigns, according to one estimate. Cash-short candidates may get help from political financiers. If the candidate wins, the financier demands pay-back in the form of business concessions.

Elected office-holders have been caught in political corruption. KPK (Corruption Eradication Commission) has detected and prosecuted 21 governors entangled in corruption from 2004 to July 2020. For the same period, 122 district chiefs, mayors, deputy district chiefs, and deputy mayors also got ensnared.

Stationary democracy

Single-ticket contests is also a searing issue. This is when a candidate faces no challenger. KPU identified 25 such tickets. The election law states a party or a coalition can field a candidate if they have at least 20% of the legislative seats won in the previous election.

Say, the candidate mayor garners the support of parties that jointly have more than 80% of the seats in the local legislature. Thus, any remaining parties together don’t have the minimum 20% seat-count to support a rival ticket. When this happens, that single ticket competes with a kotak kosong (blank box).

If the empty box wins the contest, the local KPU office would hold a new election that would have more than one ticket.

An empty box won the contest for mayor of Makassar in a 2018 local election. The KPU Makassar office is holding a second election this year with four tickets.

Single-ticket polling does not foster democracy as democracy thrives and throbs through competition.

With political party failure to promote meritocracy, corruption and unchallenged electoral contests, Indonesia’s democracy is not marching forward.

Significance

Indonesia’s democracy is imperfect. The local election process is wanting. However, the significance of Indonesia’s local elections is that they are a proving ground for national leadership. Surakarta city mayor Jokowi succesfully ran to be Jakarta governor in 2012. Two years later, in 2014 Jokowi stood for president and won.

Local election winners can stand for president in 2024. Front runners are Jakarta Governor Anies Baswedan, West Java Governor Ridwan Kamil, and Central Java Ganjar Pranowo.

Competition would be tough with established national-level figures. One is Prabowo Subianto, Jokowi’s opponent in 2014 and 2019. Another is businessman and former Jakarta vice-governor Sandiaga Uno who was Prabowo’s running-mate in 2019. A third is DPR speaker Puan Maharani.

Puan is daughter of Megawati Sukarnoputri, general chair of the Indonesian Democratic Party in Struggle (PDI-P), the largest party in parliament. Megawati was the nation’s fifth president (2001-2004). Puan is also granddaughter of Indonesia’s founding father and first president, Sukarno. If Puan makes it, she would be a dynastic third-generation president in the making.

Warief Djajanto Basorie is Instructor, Dr Soetomo Press Institute (LPDS), Jakarta

 

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Family in a flooded village on the banks of the Atrato River in Chocó, Colombia. Credit: Jesús Abad Colorado/IPS

By Carmen Arroyo
NEW YORK, Dec 8 2020 (IPS)

After ten years without a strong La Niña weather phenomenon in Colombia, the climate pattern, coupled with the COVID-19 pandemic, could create a vacuum in food production and supply. Multilateral organizations, along with the Colombian government, are trying to implement measures to reduce malnutrition risk. Still, the population is already overwhelmed by a year of struggles that have deepened socio-economic differences.

Starting in March this year with the COVID-19 pandemic and followed by the hurricane IOTA in November, Colombia has seen its malnutrition levels rise dramatically. The pandemic has left over 37,000 deaths and an increase of 6.4% in unemployment in October compared to the same month in 2019. (This percentage doesn’t account for informal workers—47% of the population, according to the country’s statistics department DANE).

“[The socio-economic crisis] is coherent with a deepening poverty situation as highlighted by the latest official figures—35.7% of Colombian households were in poverty in 2019, already some 660,000 more than in 2018,” says Lorena Peña, the communications coordinator for the World Food Programme (WFP) in Bogota to IPS, going back to the numbers before the pandemic.

Those data points are likely to increase—especially in La Guajira, Norte de Santander and Bolivar,—as the country prepares for the expected La Niña-caused heavy rains, which the Colombian Weather Institute (IDEAM) estimates to last until May of next year.

According to the World Meteorological Organization (WMO), La Niña is a cooling of ocean surface temperatures that generates winds and rainfalls in the equatorial Pacific Ocean. In 2020-2021, the phenomenon is expected to be moderate to strong, as it was in the period 2010-2011. That time, La Niña claimed 300 lives and left an equal number of people injured.

This year, the phenomenon could lead to landslides, floods, diseases, and pests, say Jorge Mahecha, communications coordinator, and Martina Salvo, in charge of agricultural resilience, at the Food and Agriculture Organization (FAO) of the United Nations in Bogota to IPS.

A drawback in Colombia’s nutrition achievements

In the past five years, Colombia has established itself as the leading middle-income country in sustainable agriculture and food nutrition, according to the Food Sustainability Index, developed by the Barilla Center for Food & Nutrition and the Economist Intelligence Unit.

Colombia achieved top performances in the use of land, air, and water in the ranking. It was second, out of 23 counties, in tackling nutritional challenges, such as undernutrition and hidden hunger, notes the report. It was also well above some of its peers, such as Mexico, regarding food nutrition indexes.

The Colombian flag flying over the castle San Felipe de Barajas in Cartagena de Indias, Bolívar, Colombia

However, the pandemic has meant a drawback for Colombia. Before La Niña, WFP was already estimating that 52.6% of the population had problems accessing food “of which at least some 3.5 million people [were forecast to be] severely food insecure,” told Peña from WFP to IPS. She added that food insecurity was more prevalent in Arauca, La Guajira, Norte de Santander, and Bolivar.

Now that La Niña is reaching Colombia, food security could further deteriorate, depending on the intensity of the weather pattern.

“The La Niña phenomenon tends to be associated with heavy rainfall in Colombia, but this doesn’t necessarily mean that the crops will be harmed,” says Carmen González Romero, country manager for Colombia in the ACToday (Adapting agriculture to Climate Today for Tomorrow) project. The project is led by the International Research Institute, part of the Earth Institute at Columbia University. “If the intensity of the rain is high enough, yes, it could destroy them.”

The impact could be felt throughout the food production system. “On the one hand, heavy rains could destroy the crops of subsistence farmers. This would not only impact their access to food in the present but also in the near future threatening their basic grain reserves,” explains González Romero. “On the other, large producers, associated with a guild and higher technological capacity, could also see their business endangered. This would generate a vicious cycle, laborers that work for them would lose their jobs and their income. Additionally, heavy rains could impact civil infrastructure, limiting the access to markets, which are essential for food security in the country.”

The FAO predicts that among the crops to be impacted by the torrential rains are the “pancoger crops [crops that meet a family’s nutritional needs] such as plantain, corn, yuca, and beans.” Other crops that Colombia exports, such as cacao and coffee, could also be harmed by the changing weather forecasts, add Mahecha and Salvo, from FAO.

Farmers and institutions prepare for La Niña

The Colombian government, its weather institutions, and farmers will have to face the consequences of La Niña soon.

Asked how farmers can prepare themselves for weather patterns, González Romero responds: “Farmers need access to climate services to optimize crop management and resources.” She adds that their capacity to prepare themselves for weather patterns also depends on their economic resources and the time they have to prepare.

Moreover, explains González Romero, there are financial instruments for climate risk transfers, such as index-based insurances, that could mitigate the harm of adverse climate events, be it floods or droughts. “They exist, but they are not widely available in Colombia, nor South America.”

At an institutional level, the government could create forecast-based financing systems that would trigger cash transfers to impacted workers if droughts or floods harm their crops, notes González Romero.

Multilateral organizations are also preparing for La Niña while they still try to alleviate the pandemic’s consequences. To ensure that malnutrition is not widespread, the FAO argues that food supply systems should be prioritized. However, some roads have become unusable, tells Peña from the WFP to IPS, adding that, for example, in-kind food transport to Alta Guajira was delayed in October.

The population that is expected to be impacted by La Niña is the most vulnerable, say the FAO representatives, adding that the same sector has also suffered the most during the pandemic.

The WFP is mobilizing “cash-based transfers where possible, and in-kind is also planned for areas where markets are not fully functional,” says the institution. They are working in Arauca, Bolívar, Chocó, La Guajira, and Norte de Santander, where food insecurity is widespread.

On its part, UNICEF is prepared to provide nutritional supplements to children under five years of age in the sites where WFP delivers food support.

As institutions and farmers try to grapple with the possibility of La Niña, stakeholders fear the weather phenomenon will deepen the socioeconomic differences already sharpened by the pandemic—especially in rural areas.

Still, it’s hard to predict the consequences of the phenomenon until it hits the country. “We have yet to see what La Niña brings,” concluded González Romero on a cautionary note.

 

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Manchester United defender Axel Tuanzebe talks about leaving the Democratic Republic of Congo as a child to build a new life in the UK.

At a joint meeting of the UN's Economic and Social Council (ECOSOC) and its Economic and Social Committee, a robot named Sophia had an interactive session last year with Deputy Secretary-General Amina J. Mohammed. Credit: UN Photo/Manuel Elias

By Cristian Alonso, Siddharth Kothari, and Sidra Rehman
WASHINGTON DC, Dec 8 2020 (IPS)

New technologies like artificial intelligence (AI), machine learning, robotics, big data, and networks are expected to revolutionize production processes, but they could also have a major impact on developing economies.

The opportunities and potential sources of growth that, for example, the United States and China enjoyed during their early stages of economic development are remarkably different from what Cambodia and Tanzania are facing in today’s world.

Our recent staff research finds that new technology risks widening the gap between rich and poor countries by shifting more investment to advanced economies where automation is already established.

This could in turn have negative consequences for jobs in developing countries by threatening to replace rather than complement their growing labor force, which has traditionally provided an advantage to less developed economies.

To prevent this growing divergence, policymakers in developing economies will need to take actions to raise productivity and improve skills among workers.

Results from a Model

Our model looks at two countries (one advanced, the other developing) that both produce goods using three factors of production: labor, capital, and “robots.” We interpret “robots” broadly, to encompass the whole range of new technologies mentioned above.

Our main assumption is that robots substitute for workers. The AI revolution in our framework is an increase in the productivity of robots.We find that divergence between developing and advanced economies can occur along three distinct channels: share-in production, investment-flows, and terms-of-trade.

Share-in-production: Advanced economies have higher wages because total factor productivity is higher. These higher wages induce firms in advanced economies to use robots more intensively to begin with, especially when robots easily substitute for workers.

Then, when robot productivity rises, the advanced economy will benefit more in the long run. This divergence grows larger, the more robots substitute for workers.

Investment-flows: The increase in productivity of robots fuels strong demand to invest in robots and traditional capital (which is assumed to be complementary to robots and labor). This demand is larger in advanced economies due to robots being used more intensively there (the “share-in-production” channel discussed above).

As a result, investment gets diverted from developing countries to finance this capital and robot accumulation in advanced economies, thus resulting in a transitional decline in GDP in the developing country.

Terms-of-trade: A developing economy will likely specialize in sectors that rely more on unskilled labor, which it has more of compared to an advanced economy. Assuming robots replace unskilled labor but complement skilled workers, a permanent decline in the terms of trade in the developing region may emerge after the robot revolution.

This is because robots will disproportionately displace unskilled workers, reducing their relative wages and lowering the price of the good that uses unskilled labor more intensively.

The drop in relative price of its main output, in turn, acts as a further negative shock, reducing the incentive to invest and potentially leading to a fall not just in relative but in absolute GDP.

Robots and wages

Our results critically depend on whether robots indeed substitute for workers. While it may be too early to predict the extent of this substitution in the future, we find suggestive evidence that this is the case. In particular, we find that higher wages coincide with significantly higher use of robots, consistent with the idea that firms substitute away from workers and towards robots in response to higher labor costs.

Implications

Improvements in the productivity of robots drive divergence between advanced and developing countries if robots substitute easily for workers. In addition, those improvements will tend to increase incomes but also increase income inequality, at least during the transition and possibly in the long run for some groups of workers, in both advanced and developing economies.

There is no silver bullet for averting divergence. Given the fast pace of the robot revolution, developing countries need to invest in raising aggregate productivity and skill levels more urgently than ever before, so that their labor force is complemented rather than substituted by robots.

Of course, this is easier said than done. In our model, increases in total factor productivity—which account for the many institutional and other fundamental differences between developing and advanced countries not captured by labor and capital inputs—are especially beneficial as they incentivize more robots and physical capital accumulation.

Such improvements are always beneficial, but the gains are stronger in the context of the AI revolution.

Our findings also underscore the importance of human capital accumulation to prevent divergence and point to potentially different growth dynamics among developing economies with different skill levels.

The landscape is likely going to be much more challenging for developing countries which have hoped for high dividends from a much-anticipated demographic transition. The growing youth population in developing countries was hailed by policymakers as possibly a big chance to benefit from a transition of jobs from China as a result of its graduating middle-income status.

Our findings show that robots may steal these jobs. Policymakers should act to mitigate those risks. Especially in the face of these new technologically-driven pressures, a drastic shift to rapidly improve productivity gains and invest in education and skills development will capitalize on the much-anticipated demographic transition.

 

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The post How Artificial Intelligence Could Widen Gap Between Rich & Poor Nations appeared first on Inter Press Service.

Excerpt:

Cristian Alonso is an economist in the IMF’s Fiscal Affairs Department; Siddharth Kothari is an economist in the IMF’s Asia and Pacific Department’ Sidra Rehman is an economist in the IMF’s Middle East and Central Asia Department.

The post How Artificial Intelligence Could Widen Gap Between Rich & Poor Nations appeared first on Inter Press Service.

By Jomo Kwame Sundaram and Anis Chowdhury
KUALA LUMPUR and SYDNEY, Dec 8 2020 (IPS)

Fiscal and monetary measures needed to fight the economic downturn, largely due to COVID-19 policy responses, require more government accountability and discipline to minimise abuse. Such measures should ensure relief for the vulnerable, prevent recessions from becoming depressions, and restore progress.

Jomo Kwame Sundaram

They should help the most helpless, especially in the informal sector and casual employment. Efforts should also seek to accelerate structural transformation towards the Sustainable Development Goals (SDGs). Progress was already falling behind before the pandemic, e.g., on mitigating global warming.

Unconventional measures
The pandemic and policy responses have created a most unusual situation, demanding extraordinary policy responses to mitigate threats to livelihoods and incomes. Bold initiatives are needed to overcome obstacles to sustainable development.

Unconventional solutions need to be considered as the conventional wisdom is part of the problem, especially since the neoliberal counter-revolution against Keynesian and development economics four decades ago.

In recent decades, counter-cyclical fiscal policies over business cycles have been replaced by annually ‘balanced budgets’ and ‘fiscal consolidation’. This has involved spending cuts for public, including social services, and social protection more broadly.

Taxation has become more regressive, with lower direct tax rates, on wealth as well as corporate and personal income, as indirect taxation, mainly on consumption, has grown. Such tax reforms and regressive government spending have worsened inequality.

Deficit financing inflationary?
Publics often presume that governments tax first in order to spend. In practice, they usually spend first, and then tax. Government spending typically requires more borrowing and debt, traditionally by selling bonds and other securities, including to the central bank.

Selling government treasury bonds to the central bank increases money supply, unless the monetary authority correspondingly reduces its other liabilities. Neoliberal critics insist that increasing money supply, popularly referred to by the media as ‘printing money’, must inevitably worsen inflation.

Anis Chowdhury

However, there is overwhelming empirical evidence to the contrary as the US Federal Reserve, the European Central Bank, the Bank of England and the Bank of Japan greatly increased money supply over the last decade. They mainly did so by buying private securities, and getting commercial banks to lend more at lower interest rates.

As such unconventional monetary policies, including ‘quantitative easing’ (QE), in the last decade did not raise prices, there is no reason to presume that central banks buying treasury bonds – to pay for relief, recovery and building a better future – will be inflationary.

Deficit spending ineffective?
Governments can also borrow from the public, e.g., by selling bonds to them. But according to neoliberal beliefs, borrowing from the public will raise the interest rate, ‘crowding out’ private borrowers who cannot afford the higher ‘costs of borrowing’. Hence, they claim, investments will fall, slowing growth.

But for Keynesians, government spending is not inflationary when economic resources are not fully employed or utilised, i.e., as long as there is idle excess capacity, e.g., unemployment.

Keynesians also reject the neoliberal claim that public investment will ‘crowd out’ such private spending. Keynesians stress that economic stagnation discourages private investment. By boosting demand and sales, government spending increases private profits and investment.

Declining private spending or demand thus requires government spending to boost aggregate demand. Government spending on infrastructure, health and education also improves productivity, and hence profitability, offsetting higher borrowing costs. Thus, government spending serves to ‘crowd-in’, not ‘crowd-out’ private investment.

Incoherent, unsupported objections
The ‘Ricardian equivalence’ objection is very different, claiming that when governments borrow, people spend less, in anticipation of higher taxes. This supposedly undermines the intent of greater government spending to raise aggregate demand. But again, there is no strong supporting evidence for this effect.

This argument is not only quite different from the earlier ‘crowding out’ and inflation objections, but also implies that the three neoliberal arguments against deficit financing are mutually contradictory and cannot be coherently sustained.

In contrast, the International Monetary Fund (IMF) found that “debt-financed projects could have large output effects without increasing the debt-to-GDP ratio, if clearly identified infrastructure needs are met through efficient investment”, accelerating recovery from the global financial crisis (GFC).

Similarly, in response to the pandemic induced recessions, the IMF argues that “increasing public investment … could help revive economic activity from the sharpest and deepest global economic collapse in contemporary history”.

‘Sound finance’, fiscal rules
Unfortunately, expansionary fiscal policies are often abused by ‘short-termist’ governments of the day, little concerned about the long- and even medium-term consequences of increased spending, borrowing and debt.

In response, neoliberals invoke ostensible ‘sound finance’ principles. Sound finance seems desirable when spending abuse, wastage and leakages are widespread. However, it has become a pretext for dogmatically opposing bold fiscal measures, however much needed. Neoliberals want fiscal rules to straight-jacket governments, obliging the authorities to balance budgets annually or keep fiscal deficits minimal. Many advocate independent fiscal boards, akin to politically unaccountable ‘independent’ central banks, ostensibly to minimise political influence on government budgetary decisions.

Even when fiscal rules or boards allow some flexibility in times of crisis, or in response to severe shocks, biases towards ‘fiscal consolidation’ and pro-cyclicality run deep, undermining development efforts. Hence, fiscal rules typically hinder, rather than help development.

Counter-cyclical, developmental ‘functional finance’
Instead, ‘functional finance’, proposed by Abba Lerner to mitigate prejudice against fiscal policy activism, is needed. Government spending and taxation policy should instead be consistent with counter-cyclical and developmental fiscal needs.

This was recognised by the Development Committee of the World Bank and IMF in Fiscal Policy for Growth and Development: An Interim Report which observed:
“the problem of fiscal policy design is a reflection of the choice of the fiscal deficit as the policy target. The fiscal deficit is a useful indicator …, but it offers little indication of longer term effects on government assets or on economic growth… There is clearly a need for fiscal policy to incorporate…the likely impact of the level and composition of expenditure and taxation on long-term growth while also maintaining a focus on indicators essential for economic stabilization”.

Oppose abuse, not more spending
Poorly accountable governments often take advantage of real, exaggerated or imagined crises to pursue macroeconomic policies to secure regime survival and to benefit politically well-connected cronies and financial supporters.

Undoubtedly, much better governance, transparency and accountability are needed to minimise the likely immediate and longer-term harm due to ‘leakages’ and abuses associated with increased borrowing and spending.

There has to be much greater discipline and stricter scrutiny of government borrowings, spending and debt, as well as of government-guaranteed liabilities. Consistently counter-cyclical fiscal policy over the course of business cycles provides useful guidance.

Publics and their political representatives, especially in developing countries, must develop more effective modes of disciplining fiscal policy conduct to ensure space for responsible counter-cyclical and developmental spending. However, that task should not block the efforts urgently needed to finance relief, recovery and sustainable development.

Central banks must support governments’ fiscal stimulus packages for relief, recovery and building a better future. This requires complementary fiscal and monetary policies working in tandem for sustainable development.

 

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Dr Ashraf Emarah is one of 14 doctors to have died from coronavirus in Kenya, prompting a strike call.

By Mostafiz Uddin
Dec 7 2020 (IPS-Partners)

The global apparel industry is broken and only urgent, drastic surgery can fix it. I am not talking about another initiative or another public relations exercise. I am talking about deep, systemic change to be agreed by all involved—by brands, by suppliers, governments, unions and NGOs.

Why do I think this? Let us look at the evidence. In the past week several news stories have made headlines around the world. All are interlinked and, together, they paint a picture of an industry which continues to serve one set of interests at the expense of another.

One story is when the latest lockdown ended in the UK, shoppers were said to be queuing in the middle of the night, in the freezing cold, in anticipation of fashion brands opening its doors. People are supposed to be struggling financially in the west, but the fast fashion industry marches onwards. The fashion brands and retailers have had a similarly positive response since reopening stores. Nothing seems to stand in their way.

Story number two concerns a company which I have worked with in the past—Arcadia, which owns British brands Top Man, Top Shop and Burton. Arcadia has this week gone into administration, as has department store, Debenhams. Both have been struggling for some time, and have been hit hard by the coronavirus pandemic. The potential bankruptcy of these two companies will hit hundreds of garment suppliers in Bangladesh. When the liquidators come to pay creditors, suppliers will be way down the list. Many will be lucky to receive anything at all and will take a massive financial hit.

They may complain but they also know that this is just how it is in our industry. In Bangladesh we are at the bottom of the food chain, just like our garment producing compatriots in India, Cambodia, Myanmar and so on.

Taken together both the stories illustrate the completely lopsided nature of the global fashion industry—and tell us why something has to change.

How can it be that in one part of the world, shoppers are queuing through the night to purchase clothing while in another part of the world the manufacturers are suffering by not receiving their legitimate payment. How has our industry reached this state of affairs? The very people who are bearing the brunt are the most vulnerable group of the fashion supply chain—workers.

Failure does not seem to be an option for many western retailers and department stores. In recent years, we have also seen the likes of Sears Corp, Peacocks and Forever 21 in administration or undergoing restructuring. Why? Because they were not making money. They restructure and in that process a lot of their debts with suppliers—yes, that’s people like me—are written off. Then they return and the whole process starts again.

Nobody should begrudge apparel brands and retailers for their success. But we need to think very carefully about how we can ensure the benefits of this success are shared right along the supply chain. If an industry has one part in which companies are making huge profits while in another part, workers are going hungry, something has clearly gone very wrong. Something is out of kilter.

This brings me to the final point relating to Arcadia. When a brand goes bust—as several have during this pandemic—it is always the suppliers and their workers who suffer the most.

We can all also see why retailers are struggling, and they have my sympathy (in some cases). What I fail to understand, however, is how there is not some kind of protection in place for workers when a major brand goes bust. For some time now, there have been calls for some kind of fund or pot which brands would pay into as a part of doing business with garment factories in Asia. This fund would be used to ensure workers are paid severance and legally owed wages in the case of insolvency.

This may sound extreme but we have already seen that brands simply cannot be trusted to protect the workers in their supply chains through voluntary codes of conduct. Yes, there are many brands and retailers who are not only trendsetters but also pioneers in global business in responsibility and practicing ethics as well as taking care of every member including workers. But there are also many who do not care—some of the more glaring examples we have seen during this Covid-19 pandemic.

As suppliers, we cannot depend on the goodwill of brands. It has become clear now that our industry needs binding legislation and supply chain regulation to hold brands to account for respecting human rights in their supply chain.

We cannot as an industry keep talking about things and saying this or that will change in the future. We have been saying these things for decades. Words are all well and good but, sadly for garment workers, they don’t put food on the table.

Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Apparel Exchange (BAE).

This story was originally published by The Daily Star, Bangladesh

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Ambassador Chowdhury presiding over a Security Council session. Credit: United Nations

By Thalif Deen
UNITED NATIONS, Dec 7 2020 (IPS)

Will four strong contenders for permanent seats in the UN Security Council (UNSC)– Germany, India, Japan and Brazil—help break the monopoly now being held by the big five, namely the US, UK, France, China and Russia?

But if they do eventually succeed in their attempts—after more than 20 years of foot-dragging — they have to put up with what is best described as “second-class citizenship”, because the five, veto-wielding permanent members (P5) have given no indications that any new comers to their ranks will be offered veto powers.

Still, African leaders have long insisted they will not accept any permanent memberships in the UNSC, the only UN body with powers to declare war and peace, without veto powers.

And rightly so, because it entrenches political discrimination at the highest levels in a world body which preaches the virtues of equality to the outside world but refuses to practice it in its own backyard.

Speaking on behalf of the 54-member African Union, and addressing a General Assembly debate back in November 2018, the representative of Sierra Leone made it unequivocally clear “Africa demands no less than two permanent seats, including the veto power, if it remains, and five non permanent seats”.

But that position has not changed—and the deadlock over the reform of the UNSC continues—and perhaps will continue during the rest of the lifetime of the 75-year-old United Nations.

With the appointment of two new envoys — Ambassador Joanna Wronecka of Poland and Ambassador Alya Ahmed Saif Al-Thani of Qatar as co-chairs– there is a renewed attempt to resume the stalled Intergovernmental Negotiations on UNSC reforms.

In an interview with IPS, Ambassador Anwarul K. Chowdhury, a former President of the Security Council (March 2000 and June 2001) held out a bleak prospect: “As a pragmatic, realistic UN watcher and practitioner for nearly 50 years, I believe the painstaking efforts for the SC reform has no prospect for a meaningful achievement and the status quo ante is doomed to continue”.

Asked if the current attempt is just another exercise in political futility, he said any worthwhile initiative to revive the repeatedly stalled efforts for the “Security Council reform” generally creates a nice feel-good ambience full of expectation, full of hope of the otherwise most-attainable success, full of preparations to finally breaking the deadlock.

Such an ambience was perceived in every such occasion of resumption, but unfortunately it ended in coming to a grinding halt with the formal closer of that exercise, said Chowdhury, who was Permanent Representative Bangladesh to the UN (1996-2001) and UN Under-Secretary-General (2002-2007).

However, in the true UN tradition, he pointed out, the agenda-item stays on and every President of the General Assembly (PGA) hopes against hope of a breakthrough.

In fact, resuming that multi-stalled effort for a quarter of a century has given subsequent PGAs a sense of glory and an aura of leadership – and also, many of us a feeling of déjà vu.

Excerpts from the interview:

IPS: Why do you think the exercise is doomed to fail?

Ambassador Chowdhury: What is the rationale basis for exploring “the possibility for the Intergovernmental Negotiations to start early in 2021 and to increase the number of meetings this session…”? Just for the cosmetics of the exercise because the “Security Council reform” is on the agenda of the General Assembly? It should be understood that the general membership of UN and all well-meaning, peace-loving people aware of global realities are not interested in the so-called reform of the Security Council.

There exist bigger challenges facing humanity which require more intense engagement of UN. The much-expected change in view of the Covid-19 pandemic has bypassed the needed change in the divisive negotiating atmosphere at the UN. It is still business as usual.

IPS: What are your thoughts on the expansion of membership of the Security Council?

Ambassador Chowdhury: If the past trends of the UNSC reform exercises are any guide, the reform is envisaging four tiers of Security Council membership – one, five permanent members with veto (known as P-5); two, new permanent members without veto; three, 2-year non-permanent members both existing 10 plus the new ones; and four, the rest of the UN membership who are not the Council members.

Such expansion would not help in any way except adding to lop-sidedness of UNSC work and satisfying the nationalistic aspirations of new permanent members. The lofty objective of the reform exercise to reflect the realities of the current expanded UN membership of 193 would lose all credibility if this is the intended outcome.

Also, it is absolutely fair to allocate two permanent seats to Africa as it is the largest regional group along with the fact that it did not have any permanent seat since the creation of the UN.

IPS: Do you think the closed, non-transparent decision-making by the Security Council is an area concern in the reform exercise?

Ambassador Chowdhury: By itself, the current SC decision making is not what the Charter had envisaged – role of P-5 occasionally joined by their “friendly” non-permanent members make a mockery of their responsibility for the maintenance of the international peace and security as the SC members.

The history of the Council decision-making makes it clear that its membership has been basically used for reflecting national perspectives and advancing the geo-strategic objectives of the P-5. Like many, I believe any meaningful reform of the Council has to start with the abolition of veto.

It is well-known to all keen UN watchers how the veto — or in most cases the threat of veto — has been used and abused during 75 years of UN’s existence to subvert the best interests of global peace and security.

IPS: In addition to the issue of expansion, the reform of the working methods is also being addressed. How this concern can be addressed properly?

Ambassador Chowdhury: Working methods reform would not work just readjusting the procedural functions – without changing the policy considerations, without coming out of the failed state-oriented security strategies and replacing those with more people-oriented human security-oriented strategies.

Reforming working methods without change of policy orientation would only be robotic in nature, without any focus on human dimensions of the Council’s actions.

IPS: Civil society has called, again and again, for an opportunity to present their thoughts on the SC reform. Is that deemed useful and necessary?

Ambassador Chowdhury: Though the “process is an intergovernmental one and thereby Member States-driven”, as PGA has reiterated, absence of civil society involvement would seriously undermine the role and contribution of “We the Peoples …”.

When civil society in general feels it has no role, no opportunity to share its points of view, I believe that such a narrow non-inclusive, non-participatory exercise is bound to fail. PGA himself has also asserted that “civil society is the pillar of democracy, and we must, after some time, find a way that civil society is (re)presented here”.

IPS: What are some of the biggest failures of the UNSC over the years?

Ambassador Chowdhury: I would not go into identifying the cases where the Security Council failed big — the global peace and security situation testifies for that. I would rather identify the reasons which caused those failures and would continue to do so in future, again and again.

Structural issues and leadership opportunities within the Council is a major impediment. P-5 is happy with the status quo – the way the Council works – because they have shaped it that way over the years to their advantage. All the substantive change initiatives have come from the 2-year tenure of non-permanent members.

The pro-active role and guidance of the Secretary-General to the Security Council, without being unduly mindful of P-5 “sensitivities,” can bring in marked change in the directions of the Council’s work. PGA has identified that “the Secretary-General is the engine and the transmission system”. After all, the Secretary-General has the moral authority and full mandate of the high office he holds.

IPS: Is big power rivalry, and protection of client states, one of the reasons for the frequent deadlocks in the UNSC over the years?

Ambassador Chowdhury: Not only big power rivalry has caused deadlocks, big power “collaboration” has also resulted in halting a positive initiative in the best interest of the Security Council from the non-permanent members. My own experience as the President of the Security Council in March 2000 explains that situation amply when I initiated the political and conceptual changes in the Council to recognize the equal participation and age-old contributions of women in global peace and security which finally resulted in the adoption of the most-widely acclaimed UN Security Council Resolution 1325.

Here, I would add that the only silver lining I find in the resumption of the reform negotiations is the fact that the two Co-Chairs (Ambassadors of Poland and Qatar) are both eminent women Permanent Representatives to the UN and, of course, fully qualified for this onerous and complicated responsibility.

 

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Reporter Fateh Al-Rahman Al-Hamdani writes about his experience of secretly filming inside Sudan's Islamic boarding schools to expose abuse, and reveals why the investigation was so personal to him.

Groundnut farm in Torit, South Sudan. Credit: Isaiah Esipisu/IPS.

By Agnes Kalibata
NAIROBI, Dec 7 2020 (IPS)

’A hungry man is not a free man. He cannot focus on anything else but securing his next meal.’ So proclaimed the late Kofi Annan.

In 2003, Kofi Annan and a like-minded group of African leaders recognized hunger as a complex crisis on the continent.

They saw the eradication of hunger as not just an end in itself – but the first step towards sustainable development and progress, requiring the transformation of African agriculture.

In order to address this, three momentous events occurred at that time. In 2003, the Comprehensive African Agriculture Development Programme (CAADP) was launched to provide a policy framework for the transformation of African agriculture.

We need African solutions to African problems. When an African farmer has access to better technology and finance, they see improved productivity, food security and income. Most of the big mistakes in development have happened when external actors have foisted their ideas and ideologies on the continent

In 2006, the Alliance for a Green Revolution in Africa (AGRA), the organization I lead, was established to turn these ideas into reality. We are founded on the belief that the only way to do this is at scale – and yet with a focus on the farmer.

And the Africa Fertilizer conference was held, to increase access to crop nourishment – identified as the weakest link in the farming chain.

These measures have reaped rewards.

Across Africa, we have directly reached millions of farmers with increased access to technology, investment in research, financial support or training.

Significant investment was put into access to inputs – especially improved seeds, and soil health management technologies.

For instance, we have helped establish over 110 African seed companies, with some 700,000 tonnes of seed now available to 20 million farmers. Countries like Ghana and Mali had no seed suppliers, and now have an average of six each.

Across our programme countries, a network of 30,000 agri-preneurs now serve farmers.

Healthy soil is fundamental to a productive global food system. However, many smallholder farmers do not have means to prevent or address soil degradation problems. As the world commemorates the World Soil Day, we are encouraged that our soil fertility management techniques are helping reverse decades of soil depletion wherever we work.

We have taken the lead in providing evidence to governments on the value and challenges of subsidies being used in agriculture. We advocate for national policies that benefit smallholder farmers. We support upgraded storage facilities, better market information systems, stronger farmers’ associations, and more credit for farmers and suppliers.

There is still much to do, however. There are approximately 45 million farmers on the continent – African governments and investors must reach all of them if we are to see an end to poverty and hunger.

There are also new challenges. Climate change has the potential to reverse the continent’s hard won gains.

Desertification threatens productive lands. Locusts, armyworm and diseases like the Maize Lethal Necrosis wipe out the livelihoods of hundreds of thousands. Currently, COVID-19 is pushing tens of millions more into malnutrition, while farmers see their choices diminished.

As a proud African, I share Kofi Annan’s optimism and conviction. Africa will prevail, it can eliminate poverty.

I know that a major way of making this happen is through smallholder farmers. I have personally seen smallholders change at scale in Rwanda when government puts its weight behind transformative programs.

As a catalyst for change, AGRA is on track. The eleven countries we support have all advanced in the last ten years through hard work and investment. With ten years to go to meet the Sustainable Development Goals, it is important now to reflect on progress, and positioning for future gains.

Inclusive agriculture transformation is not a quick fix. It requires a long-term focus. We estimate US $25-35 billion a year of investment is needed to transform the continent’s agriculture, while an unparalleled coalition for change is required.

Ultimately, we need African solutions to African problems. When an African farmer has access to better technology and finance, they see improved productivity, food security and income.

Most of the big mistakes in development have happened when external actors have foisted their ideas and ideologies on the continent. This is why AGRA focuses on its unique position as an African institution.

African farmers deserve the same opportunities enjoyed by farmers in Europe and North America. They do not want to be stuck with 40-year-old seed varieties. When given the chance, we have seen adoption rates of 90% of new seeds in countries like Nigeria and Burkina Faso.

On a recent visit to Kiambu in Kenya, women farmers explained to me how they are happy to spend more on seeds that mature in half the time, increasing yields.

In these difficult times, there has never been a greater need for agricultural transformation. Through COVID-19, our farmers have shown great resilience, and AGRA has been on hand to support this.

To achieve Kofi Annan’s vision, we certainly need further support and investment for farmers. We must also learn as we go forward and be humble.

Our focus must always be on the needs, capabilities and choices of smallholder farmers themselves – this must be our ‘North Star’ objective, for agriculture is nothing without the farmer.

 

Dr. Agnes Kalibata is the President of The Alliance for a Green Revolution in Africa (AGRA), and UN Secretary General’s Special Envoy for the Food System’s Summit

The post Choice and Opportunity for African Farmers Will Transform Africa appeared first on Inter Press Service.

"I use gas", announces a minibus driving along a street in Mexico City. Natural gas is becoming increasingly widely used as fuel for public transportation in Mexico, coming mainly from the United States where it is extracted through hydraulic fracturing or fracking, a technique that requires high volumes of water and toxic chemicals. CREDIT: Emilio Godoy/IPS

By Emilio Godoy
Mexico City, Dec 7 2020 (IPS)

In his community of small farmers and ranchers in northern Mexico, Aristeo Benavides has witnessed the damage caused by the natural gas industry, which has penetrated collectively owned landholdings, altering local communities’ way of life and forms of production.

“They leave us nothing,” the farmer told IPS over the phone. “They tell us it’s for progress, but it’s their progress. We always lose out. When they drilled gas wells, they didn’t fence in the areas, they didn’t provide maintenance, the wells aren’t well cared for. There is a lot of underground water here that can be contaminated.”

Benavides lives 500 metres from the Los Ramones II Norte gas pipeline, which runs through five states and was sold in 2017 by the state oil company Pemex to two private entities: Infraestructura Energética Nova, a subsidiary of the U.S.-based Sempra Energy, and BlackRock, a U.S. investment fund.

The community of Benavides Grande and Benavides Olivares, with an area of 65,000 hectares and some 6,000 inhabitants, covers five municipalities in the state of Nuevo León, about 750 km northeast of Mexico City.

The members of the community, whose spokesman is Benavides, have been fighting for years against what they consider harassment and invasion of their collectively owned land by the oil and gas industry, and have achieved some victories in the courts.

In the vicinity of their land, Pemex drilled two gas wells in 2013 using hydraulic fracturing or fracking, a drilling technique that requires large volumes of chemicals and water to extract natural gas embedded in deep shale.

Academics and environmental organisations opposed to fracking argue that it pollutes water tables, induces earthquakes and emits greenhouse gases responsible for global warming.

In 2019, both wells experienced gas leaks, and the community demanded that Pemex seal them. “We talked to them several times, it took them a week to repair the leaks. And they haven’t come back to examine them. Besides, people steal gas from the pipeline, and a tragic accident could happen,” Benavides said.

Despite the social conflicts and environmental consequences, Mexico has stepped up the pace of the gasification of the country, laying pipelines and building power plants, supported by cheap imports from the United States and encouraged by the energy reform of 2013 that opened the industry to private national and international capital.

This gas well drilled by means of fracking near the Benavides Grande and Benavides Olivares community in the state of Nuevo León in northeastern Mexico suffered a leak in 2019. CREDIT: Courtesy of Aristeo Benavides

In the northern state of Sonora, the Yaqui people, one of the 67 indigenous groups living in Mexico, managed to block the construction of the private El Oro-Guaymas gas pipeline since 2017, in a campaign that generated friction among native communities and left people wounded and dead, as well as causing material damage.

The construction project “was analyzed, a consultation for public input was held, the damage was assessed and work was done to repair and mitigate the effects,” Tomás Rojo, a Yaqui spokesman, told IPS by telephone from the community of Vícam. “Seven towns gave their approval, but one did not. They felt it was a risk, and I don’t think the company wants to commit violence against the people.”

In 2017, residents of the village of Loma de Bácum dug up pipes and prevented the completion of the 330-km-long mega-project, 18 of which run through that community.

In August, President Andrés Manuel López Obrador signed an agreement with the Yaquis to divert the route of the pipeline to skirt that area, making it possible to finish laying the pipeline.

Still an oil-producing country, but on the decline

Mexico is the world’s 12th largest oil producer and 17th largest natural gas producer. It ranks 20th in terms of proven oil reserves and 37th in proven natural gas deposits. But its position in the oil industry is declining due to the scarcity of easily extractable hydrocarbons.

An ad for household gas at a bus stop in Mexico City. The Mexican government promotes the exploitation, distribution and consumption of natural gas, despite the social conflicts and environmental impacts that the industry causes. CREDIT: Emilio Godoy/IPS

Since he took office in December 2018, left-leaning President López Obrador has been promoting fossil fuels. But domestic gas production is on the decline, from 6,401 million cubic feet per day (mpcd) in 2015 to 4,853 in September, as the emphasis has been on crude oil.

Exports fell from 2,700 mpcd in 2015 to 1,000 in September, and imports from 1,415 mpcd in 2015 to 843 in September, because the state-owned Federal Electricity Commission (CFE) is burning fuel oil again.

A network of gas pipelines, with 27 state-owned and private lines covering 18,889 km, has been deployed for distribution throughout the vast territory of this country of 130 million people.

In addition, the CFE is building a section in the southeastern state of Yucatan, and three others are planned to carry the fuel to the south and southeast, while another three have been blocked by opposition from local communities.

The gas is received by 48 thermoelectric, combined-cycle plants – which burn gas to generate steam for electricity – and turbogas units, both state-owned and private. And another 10 combined-cycle plants are under construction.

Another indication of the emphasis on natural gas is the number of permits for transporting gas granted by the government’s Energy Regulatory Commission. There are 276 gas transport permits, of which 230 are already operational, 263 for transfer by pipeline (218 active) and 13 for semi-trailers (12 in operation).

All this is reflected in the public budget for the sector. In 2020, the CFE allocated more than 2.0 billion dollars to transport gas, and for 2021 it projects a total of 2.65 billion.

The construction of gas pipelines has generated conflicts with communities opposed to these mega-projects, as well as generating methane. The image is a screenshot taken by IPS from a video of the construction of the Los Ramones gas pipeline in Tamaulipas, in northeast Mexico. CREDIT: Video by the government of Tamaulipas

Natural gas consists primarily of methane, which is 86 times more powerful as an agent of global warming over a 20-year period than carbon dioxide (CO2). The National Institute of Ecology and Climate Change calculated a natural gas emission factor for six areas of Mexico of 2.27 kg of CO2/m3, although it is lower than the emission factors for coal and fuel oil.

Atmospheric problem

With more gas being sourced and flared, the country faces a growing problem with methane. In 2019, the country vented 4.48 billion m3, the ninth largest amount in the world.

In terms of intensity, the proportion reached 7.21 m3 per barrel of oil produced, higher than the previous record of 5.39 set in 2014, according to figures from the Global Gas Flaring Reduction Partnership, promoted by the World Bank with the goal of eradicating routine flaring by 2030 and made up of 17 countries, 12 oil companies, the European Union and two financial institutions.

Fossil fuels are behind methane emissions. The International Energy Agency, an intergovernmental organisation of the world’s largest consumers, estimated a total of 724,000 tons of methane from hydrocarbons – including 155,000 tons from gas – in 2019.

In addition, the López Obrador administration has kept fracking on its agenda, despite constant claims that it is not using the technique.

Sergio Sañudo, a professor in the biological and earth sciences departments at the private University of Southern California, told IPS that “there has been a setback under this government. Mexico continues to do the same old thing. It generates complete dependence on the United States, and when the U.S. closes the valve, what will Mexico do? Mexico ties itself to hydrocarbons and that serves as an outlet for the gas.”

The solution, he continued, lies in the United States abandoning fracking so that Mexico would not import more fuel and would promote renewable energy sources.

Benavides says his community is very aware of the climate crisis, because it has seen the changes. “There have been hailstorms, temperature changes, there is little rain,” he said. “These are things we haven’t seen before. For everything that happens, the earth will get back at us. For how many months did that gas go into the atmosphere, because of the leaks?”

Sañudo urged Mexico to distance itself from natural gas. “It is not a fuel for the energy transition to cleaner sources. It is not the panacea it was thought to be. It can no longer compete with renewables,” he argued.

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• Energy Cooperatives Swim Against the Tide in Mexico
• Mexico’s Development Banks Fuel the Fossil Energy Trade
• Mexico’s Plan to Upgrade Hydropower Plants Faces Hurdles

The post Mexico Sticks to Natural Gas, Despite Socioenvironmental Impacts appeared first on Inter Press Service.

South Africa's farmers are fighting ongoing locust swarms to preserve the country's food security.