Archive for the 'Corporate Issues' Category
Amnesty International Highlights the Vedanta Case

Set in the fantasy world of Pandora, Avatar tells the story of the Na’vi — a clan of blue-hued humanoids whose existence is threatened by a mining corporation which wants to exploit a vast store of mineral deposits which lies beneath a giant sacred tree.

In India’s impoverished but mineral-rich state of Orissa, hundreds of indigenous tribespeople are battling to stop London-listed Vedanta Resources Plc from extracting bauxite from what they say is their sacred mountain.

“The fundamental story of Avatar — if you take away the multi-colored lemurs, the long-trunked horses and warring androids — is being played out today in Niyamgiri mountain in India’s Orissa state,” said Stephen Corry, director of the British charity, Survival International.

“Like the Na’vi of Avatar, the Dongria Kondh tribe are also at risk.”

Vedanta says its mine would not violate the rights of indigenous tribespeople, saying that all its projects are conducted within the law and using international best practices.

“It is a myth that people don’t want development. The tribals want their children to go to school and have enough to eat,” said Mukesh Kumar, CEO of Vedanta’s alumina refinery, located at the foot of the mountain, which will process the bauxite.

“If the mine goes ahead, Vedanta will help them to achieve this.”

NGOs like ActionAid say around 8,000 people will be affected by Vedanta’s mining plans which have been stalled since 2005 due to legal wrangles over environmental and social concerns. Vedanta says it expects approval from authorities in the coming months.

Since 2007, four international investors — including the Church of England — have sold off their stock in the company citing ethical concerns over the project.

Last month, Britain’s Joseph Rowntree Charitable Trust sold its 1.9 million pound share, saying Vedanta was “pushing industrialization to the detriment of the lives of local people.”

Industrialization

While the box-office hit’s story to save the Na’vi’s “Tree of Souls” is a battle between good and evil, the fight for Niyamgiri mountain appears more a dilemma of industrialization versus tribal rights.

The tussle in the lush mountain forests of Niyamgiri between the Dongria Kondh people and Vedanta highlights a broader standoff between industry and villagers and tribesmen in India’s mineral belt — made up of the country’s most underdeveloped states of Orissa, Jharkhand and Chhattisgarh.

Steel companies like Arcelor Mittal and POSCO are facing resistance from establishing plants, not only from villagers and tribesmen, but from Maoist insurgents who for decades have been waging a war against industrialization.

Companies and the federal government argue that in a country where around 40 percent of the population lives below the poverty line, exploiting lucrative deposits of minerals such as iron ore, bauxite, coal and manganese is the only answer.

Last month, the mines minister said India planned to raise the compensation for people displaced by large mining projects in a move that could sooth opposition to leases but will raise costs.

Local Development

Vedanta, which has already built an alumina refinery at the foot of the mountain in Lanjigarh town, in anticipation of gaining clearance to mine, says the planned project will not affect the tribespeople or the environment.

And the multinational has also launched a campaign to win hearts and minds through a range of corporate social responsibility activities, which includes building schools, and health clinics and income-generation projects.

Vedanta’s Kumar says the impoverished town was a mere assortment of tribal villages with little infrastructure and public services before Vedanta arrived.

“The refinery has improved people’s lives,” said Kumar, adding that the number of malaria cases and families living below the poverty line has fallen since the refinery was established.

Signs on everything from roads and bridges to traffic police booths are adorned with the company’s name and logo. Schools, clinics and even electricity poles are labeled “Vedanta” in bold blue.

Many local tribespeople remain skeptical.

At a clearing at the foot of Niyamgiri, hundreds of Kondh tribespeople gather to worship the mountain god, Niyam Rajah — the provider of food, water, shelter and medicine.

Women, wrapped in brightly colored saris with gold rings pierced through their noses, emerge from the dense forests to join tribal men at the annual ceremony to pay homage to the mountain.

A bearded old man, wearing a white loin cloth and waving an axe, dances around an altar as the air fills with incense and the rhythmic beating of drums. His axe eventually falls on a goat — a sacrifice to their god.

“We have lived here for thousands of years and have always worshipped Niyam Rajah in our villages,” said Mukuna Majhi, a bare-chested elderly man, carrying an axe over his shoulder.

Centuries-old trees, hundreds of species of plants with medicinal properties and the scores of perennial streams which flow down the mountain will be lost, say activists.

While both activists and Vedanta claim the support of the local population, the Kondh tribes of Niyamgiri are divided.

“Some of the villages want the mine, but many do not,” said Tudu Majhi, 46, from the village of Khemdipadhar, near the planned site of the mine. “We want development but does it have to be at the expense of our mountain?”

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Lapindo Brantas Found Responsible for Java’s Mud Volcano

A new study has concluded that a volcanic eruption of mud in Indonesia’s east Java was caused by human error in a mining operation. An international team of scientists says there is no doubt that drilling at a nearby gas well weakened rock formations, triggering the crisis.

The company responsible for the drilling, Lapindo Brantas, claims the problem was caused by an earthquake. Lapindo Brantas, however, continues to shun its responsibility.

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Papua New Guinea LNG Project Draws Criticism Amidst Growing Violence

Energy giant ExxonMobil has suspended work on a liquefied natural gas plant in Papua New Guinea after four local villagers were killed in a tribal dispute. A report from the Sydney Morning Herald:

The clash between two rival coastal villages near the capital Port Moresby occurred in an area where ExxonMobil is to build a plant to liquefy, store and load gas for shipment overseas.

The incident has forced the shutdown of road building works being undertaken by Curtain Bros, an Australian construction firm, to the planned plant site.

The fight erupted on Saturday afternoon after drunken Borea village youths threw stones at Porebada villagers as they were gardening in the area, half an hour’s drive west from Port Moresby.

Porebada villagers went to Borea village later that day to resolve the dispute, but four of them were shot dead.

PNG’s National newspaper reported the fight was linked to ongoing tensions regarding land ownership and LNG leases.

PNG’s Post Courier newspaper reported the two villages met on Sunday night, and Porebada clansmen vowed to close down the nearby LNG-related activities until the dispute was settled.

A spokesman for ExxonMobil in Port Moresby said a police investigation would provide more information about the “tragic event”.

“The safety and security of our workforce and the communities in which we operate are of the utmost importance and we are monitoring the situation closely,” he said.

“The project has temporarily suspended work in the area out of respect for the victims and their families.”

Last week the Post Courier reported 11 villagers were killed in PNG’s Southern Highlands Province (SHP) in a tribal fight tied to a land dispute over the LNG project.

ExxonMobil emphatically denied any LNG connection, while Oil Search, a partner in the $16 billion LNG project, said only two villagers died in the SHP clash.

Thousands of landowners from a variety of groups are set to profit from the LNG project, which will pump gas starting in 2014 from SHP to the plant site near Port Moresby 600km away, before shipping it to mainly Asian buyers for an estimated 30 years.

Landowners spent weeks last year cutting a deal with the PNG government, but some parties believe they missed out or were excluded from the talks.

The plant which will liquefy and load gas for export is expected to become a major pillar of the country’s economy.

But some people in the region are living in extreme poverty and activists say these large-scale projects will only benefit the rich instead of the poor, local population.

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Davos 2010 World Economic Forum — Global Economic Outlook

The International Monetary Fund is forecasting positive growth in 2010; yet, it warns the pace of growth will be too sluggish to prevent further increases in unemployment across the global economy.

Martin Wolf notes the global economic recovery might be described by the acronym L-U-V. The recovery has been L-shaped in the European Union, U-shaped in the United States and V-shaped in East Asia (ex-Japan).

What is the outlook for the global economy in 2010?

The Panelists
Josef Ackermann, Chairman of the Management Board and the Group Executive Committee, Deutsche Bank, Germany; Member of the Foundation Board of the World Economic Forum; Chair of the Governors Meeting for Financial Services 2010; Co-Chair of the World Economic Forum Annual Meeting 2010
Montek S. Ahluwalia, Deputy Chairman, Planning Commission, India
Christine Lagarde, Minister of Economy, Industry and Employment of France; Member of the Foundation Board of the World Economic Forum
Dominique Strauss-Kahn, Managing Director, International Monetary Fund (IMF), Washington DC
Lawrence H. Summers, Director, National Economic Council (NEC), Executive Office of the President, USA
Zhu Min, Deputy Governor of the People’s Bank of China, People’s Republic of China; Global Agenda Council on the International Monetary System

The panel is chaired by Martin Wolf, Associate Editor and Chief Economics Commentator, Financial Times, United Kingdom; Global Agenda Council on Systemic Financial Risk.

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Davos 2010 World Economic Forum — Global Energy Outlook

Despite the major decline in energy prices from their peak in 2008, energy security concerns have increased as major producing and consuming economies differ significantly on how to develop a more secure and stable energy system.

How can producers and consumers develop mutually beneficial approaches to energy security?

The Panelists
Ilham Aliyev, President of Azerbaijan
Thierry Desmarest, Chairman of the Board of Directors, Total, France
Khalid A. Al Falih, President and Chief Executive Officer, Saudi Aramco, Saudi Arabia
Tony Hayward, Group Chief Executive, BP, United Kingdom
Andrew N. Liveris, Chairman and Chief Executive Officer, Dow Chemical Company, USA
Peter Voser, Chief Executive Officer, Royal Dutch Shell, Netherlands

This panel is moderated by Daniel Yergin, Chairman, CERA; Executive Vice-President, IHS, USA; Global Agenda Council on Energy Security

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Davos 2010 World Economic Forum — The Next Global Crisis

The G20 is focused on preventing a repeat of the financial crisis, but the next global crisis to threaten the global economy is likely to be off the radar screen of policy-makers, as have previous ones. What warning signals need our urgent attention? In partnership with the World Economic Forum, CNBC hosts this debate focusing on the challenges and choices to be made to prevent the next great global crisis.

The panel is subtitled: Back to the Future.

Panelists
Barney Frank, Congressman from Massachusetts (Democrat), 4th District; Chairman, Financial Services Committee, USA
Jacob A. Frenkel, Chairman, JPMorgan Chase International, JPMorgan Chase & Co., USA
Lord Levene, Chairman, Lloyd’s, United Kingdom
Anand G. Mahindra, Vice-Chairman and Managing Director, Mahindra & Mahindra, India
Kenneth Rogoff, Thomas D. Cabot Professor of Public Policy and Professor of Economics, Harvard University,
Zhu Min, Deputy Governor of the People’s Bank of China, People’s Republic of China; Global Agenda Council on the International Monetary System

This panel is moderated by Maria Bartiromo, Anchor, CNBC’s Closing Bell; Host and Managing Editor, Wall Street Journal Report, CNBC, USA; Young Global Leader; Global Agenda Council on Systemic Financial Risk.

A word: the panel does not get started until the 11:25 minute mark due to live television issues.

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Haiti and the Politics of Rice

In 2008, in the midst of the global food crisis, Al Jazeera travelled to Haiti to look at the politics of rice – how such a fertile country became dependent on food aid. In the wake of this current disaster, that dependence is – initially – going to deepen. But as relief efforts slowly turn to plans for reconstruction, it is important to look back at the policies that brought Haiti to the brink in the first place, and the people who had their own vision of self-sufficiency all along. Avi Lewis talks about the US role in the development of Haiti with PJ Crowley, the spokesman at the US State Department, and Emira Woods, the co-director of Foreign Policy In Focus at the Institute for Policy Studies and an expert on US foreign policy.

The more accepted reasons for Haiti’s enduring poverty have been its internal racial divisions (a small mulatto class dominating a larger negro underclass – in the post independence era some 30,000 mulattos, gens de coleur, usurped power ruling over some 400,00 blacks), the violence of its war for independence that destroyed the economic base of the island and which claimed the lives of one in five Haitians over a 13 year period, the country’s isolation after independence (no one would trade with Haiti until 1821 when Britain finally established ties), political instability, internal divisions, poor governance and above all the crushing indemnity that Haiti agreed to pay France to stave off a second invasion of the country in 1823. Haiti would not finish paying off that debt until 1947.

More recently Haiti’s problem revolve around kleptocratic governance (the Duvalier regimes), the rise of militias as a destabilizing force (political parties in Haiti are little more than armed gangs), overpopulation put pressure on the land and the Reagan/Clinton imposed Washington Consensus that turned Haiti into the most liberalized trade regime in the Western Hemisphere. The tariffs on rice were slashed from 30% to 3% and the result was the destruction of Haiti’s agricultural sector.

Neoliberalism turned Haiti from being self-sufficient in its food production into a basket case dependent on food aid for its survival. Who benefits from this?

Arkansas rice farmers and Tyson foods. (more…)

Attack on Togolese Football Team Brings Cabinda into International Spotlight

Cabinda is a small enclave north of the Congo River delta nestled between the DR Congo and the Republic of the Congo. Like Angola it is a former Portuguese colony. When the Portuguese empire in Africa ended in 1975, Cabinda did attempt to declare itself independent of both Portugal and Angola but the main Angolan rebel group, the MPLA, took control of the enclave allegedly with the help of US oil giant Chevron.

Angola is now Africa’s largest oil producer and half of the production comes from Cabinda. The enclave has a population of some 250,000 and they have long-standing complaints against the government in Luanda. The attack on the Togolese National Football team that was to participate in the African Nation’s Cup currently being hosted by Angola is focusing renewed attention to Cabinda and the little-known group that carried out the attack – Liberation Front of the Enclave of Cabinda (FLEC).

More from Global Security:

As of 2009 the Angolan government claimed that the war in Cabinda is over. However, sporadic attacks on government forces and expatriate workers have continued. A peace deal was signed in 2006 between Angola’s government and the rebels under Bento Bembe’s leadership, but another FLEC faction has refused to sign on. Illegal detention and torture against suspected separatists continued as of late 2009, when FLEC [Front for the Liberation of the Enclave of Cabinda] claimed responsibility for the kidnapping of a Chinese worker and the killing of several Angolan soldiers. Antonio Bento Bembe, who once led FLEC, is now a minister without portfolio tasked with human rights.

Human Rights Watch said in a report released 22 Jun 2009 that there was a disturbing pattern of human rights violations by the Angolan armed forces and state intelligence officials. Between September 2007 and March 2009, at least 38 people were arbitrarily arrested by the military in Cabinda and accused of state security crimes. Most were subjected to lengthy incommunicado detention, torture, and cruel or inhumane treatment in military custody and were denied due process rights. Many of those detained were residents of villages in the interior of Cabinda who were arrested during military raids that followed armed attacks attributed to the Liberation Front of the Enclave of Cabinda (FLEC).

Successive attempts over a quarter of a century to end a “secessionist” conflict in Angola’s Cabinda enclave have yet to bear fruit. Political tensions were high in some areas of Cabinda as separatist groups demand a greater share of oil revenue for the province’s population. The separatist groups often kidnapped foreign nationals in an attempt to draw attention to their independence claims. The ongoing low-level insurgency group, Front for the Liberation of the Enclave of Cabinda (FLEC), active in Cabinda province has a history of threatening foreign nationals with kidnapping.

Often dubbed “Angola’s forgotten war”, the decades-long conflict in the oil-rich province of 250,000 people took a new turn with a government offensive in October 2002 in the Buco-Zau military region, in northern Cabinda. The armed secessionist movements, with a combined estimated force of no more than 2,000 troops, are no match for the battle-hardened Angolan Armed Forces (FAA – a Portuguese acronym), who in 2002 had finally forced Angola’s UNITA rebel movement to sue for peace after three decades of war in the country.

The Angolan economy is highly dependent on its oil sector, which accounts for about half of the country’s Gross Domestic Product (GDP) and over 90% of export revenues. Cabinda faces a situation similar to the Niger Delta states in Nigeria. Cabinda produces more than half of Angola’s oil and accounts for nearly all of its foreign exchange earnings. The province receives about 10% of the taxes paid by ChevronTexaco and its partners operating offshore Cabinda.

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Diamonds and Good Governance in Botswana

For many African countries the discovery of diamonds has turned into a curse, with blood or conflict diamonds fuelling exploitation, subversion and division. But in Botswana, its a different story.

The diamond has transformed Botswana from one of the poorest countries in the world, to one of the most prosperous and stable countries in Africa. An inspiring initiative has seen Botswanas vast diamond reserves, worth about three billion US dollars a year, being used to share wealth throughout the nation. Trade Consultant Ntetleng Masisi says they used diamonds to bring about health facilities, education and a markedly improved quality of life, Masisi says that the partnership is a necessity, The earnings from our exports of diamonds have really done a lot for us. But Botswanas reliance on diamond revenue means that the whole of the countrys future is now in the hands of the diamond dealers.

This short film is entitled Diamonds are Forever. It is produced by by SBS, distributed by Journeyman Pictures.

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Trade Weaves a Web of Interdependence in East Asia

The web of interdependence facilitated by trade in East Asia, according to Charles Kegley, would be very hard to break and no one would benefit from severing it.

Emerging East Asian economies have seen their share of world exports more than triple during past 35 years. In 1975, East Asian economies led by Japan accounted for just 5.4 percent of world exports. By 2002, their share, now more diversified across the region, had grown to 19.8 percent.

But their trade with one another has grown faster and now makes up 7.2 percent of global trade. For example, up from zero, China is now Taiwan’s tenth largest trading partner.

More from Agence France Presse on the China-Taiwan trade talks.

Taiwan aims to start formal negotiations with China on a controversial trade agreement by the middle of this month, an economics ministry spokesman said Monday.

“The ministry hopes both sides will kick off official talks on the trade pact with China in mid- or late January after several rounds of informal talks,” the spokesman told AFP.

“An exact timetable and venue for the formal talks will be decided by the negotiators,” he said, referring to semi-official bodies handling ties in the absence of formal relations.

Taiwan’s China-friendly administration hopes the negotiations will lead to a trade pact, known as the Economic Cooperation Framework Agreement, which it says could lift growth and boost employment. But the opposition Democratic Progressive Party, which favours independence from China, strongly opposes the pact, which it says would demote Taiwan to the status of a local government in future talks with the mainland.

Taiwan Premier Wu Den-yih said in a TV interview over the weekend he hopes the agreement will be signed in May or June.He added the government will try hard to explain the merits of the agreement to the opponents and clear their concerns before it is signed.

Taiwan and China have been governed separately since the end of a civil war in 1949, but Beijing considers the island part of its territory and has vowed to get it back, by force if necessary. Ties have improved since the island’s current administration assumed power in May 2008, pursuing a programme of stepping up economic ties.

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