Lessons for the G8 Members | 12 June at 7.00pm
Speakers: Hans-Joerg Rudloff, Mark Moody-Stuart
Chair: Mary Robinson
Panellists: Paul Collier, Jamie Drummond, Strive Masiyiwa
Hans Joerg-Rudloff: Good evening. I am very honoured tonight to welcome you in the name of Barclays to this event which is the last of a series of conferences which have taken place in the last weeks and days and we are very pleased to sponsor this event.
First I would like to thank a few people who have made this even possible particularly Michael Aminian, the founder of Zamyn and Sir Mark Moody-Stuart, chairman of Zamyn. Obviously the Tate Modern for hosting these lectures and particularly Sir Nicolas Serota. As well as a Tate director, Marco Daniel. convenor of audit programmes. So programmes as a partners Accenture, Africa Progress Panel and SOAS.
Tonight’s event is one of this series being held on a brought theme of global citizenship and governments focusing specifically on issues facing Africa, a significant region for Barclays because you might know that Barclays is probably the biggest bank in Africa. Barclays is particularly supportive of such dialogue which brings together thought, leaders from different disciplines to discuss global issues affecting business and society.
This evening we will be debating possible lessons for the G8 governments. Well I am particularly careful in using the ‘word world’ or giving other people lessons but the theme and the discussion will focus on the role of these governments in fostering cooperation between governments, business and other parts of our society.
Let me say maybe two words only - that Barclays has under new leadership and new management fully engaged in, what we do call as well, global citizenship. We do look for cooperation and interaction with not only governments but with any parts of our social fabric. We try and will certainly commit to look at any part of our business, at our actions and our activities with a sense of determining whether these activities stand up, are being conducted in the way prudent, cautious bankers should conduct their business but particularly as well whether these activities, engagements, commitments, lending activities and so forth serve economic progress and serve to make the world a better place.
Personally I spend the last ten years mostly in what is generally called emerging markets which is not necessarily an appropriate expression but spanning from Argentina to Russia and other areas and it is in these areas as well where the bank will have to look at every single angle of our business and it is a good and an important subject to bring up. We are faced with enormous complexities. We are faced with constant decision making whether we should continue our activities in certain countries or should start activities in certain countries, whether we should commit lending our capital to these countries, whether we should accept that these countries are different, whether we should accept sometimes oppressive regimes and nevertheless continue to engage. All of these are very difficult questions. It is each time a judgement. Whether one should appear as a sponsor of a government with whose policies we disagree. It is a question of judgement whether we should support companies who are run by individuals who exploit their own population. Whether we should engage or retreat. I belong after these ten years of activities where I firmly believe that we did achieve a lot of progress with all the inefficiencies which still exist, where we are channelling capital in capital hungry countries, where the presence of ourselves and many others is more important than given or looking for lectures and for boycotts. We do know that finance plays an important role. We do that many of these countries will depend on foreign financing for decades to come. That there will be no progress without the necessary capital supporting these activities.
We are obliged to ask for certain rules to be applied, for certain things to be done, for certain behaviour patterns because we are responsible at the same time to our investor clients, to people who engage with us in these areas. It’s a tricky question. It’s complex. It’s like an engine with ten thousand’s of little wheels which have to turn in the right direction to drive the big wheels. But we do think that in probing, in judging, in making consistently new surveys in how to behave and what to do, in the end we are making progress. We don’t want to teach other countries. We don’t want to impose them on our rules and our laws. We want to understand. Without commitment and that’s what the chairman is doing, without dialogue, without meeting, without understanding and without the necessary respect taught these countries who find themselves in a different phase of development, progress is not possible.
With that I would like to introduce tonight your panel, speakers and panel, who will give us their ideas, what they think, how an organisation like this and how the world can develop and make progress and how interaction and exchange of ideas can help us all.
Next to me, Sir Mark Moody-Stuart. He is the key note speaker for tonight. He is Zamyn’s chair and the chairman of the Foundation for the Global Compact. He was also former chairman of Anglo American and the Shell Group and there couldn’t be more international companies which are I am sure if given you a set of experiences and insight from which we will all benefit.
Mr Paul Collier is Professor of Economics and Public Policy and Blavatnik School of Government and director of the Centre for African Economies at the University of Oxford. He will be a little bit late because he is still on his train but he will join us in the course of this evening.
We have as well Mr Jamie Drummond who is the executive director and co-founder of One, a global advocacy organisation which at the moment is providing a very active crowd with excellent music at the outside of this building. It calls on governments to keep their promise to support the citizens of the world poorest countries indeed. That is an extraordinarily important job and I saw the slogan where it says ‘already at a very young age I learned that without screaming and asking I wouldn’t get anything’. So that is the slogan, it’s on the good way tonight because the music I can assure you is excellent.
We have with us as well Strive Masiyiwa, the founder and executive chairman of global telecommunication group, Econnect Wireless which has been involved in numerous initiatives to promote entrepreneurship and social development in Africa.
And finally tonight’s chair person, all well known to you, Mary Robinson, who is the president of the Mary Robinson Foundation and served and served as President of Ireland from 1990 to 1997 and the UN High Commissioner for Human Rights from 1997 to 2002.
Thank you very much and if I may turn it over to you as the chair person of tonight.
Mary Robinson (MR): Thank you.
Thank you very much and I am intrigued and please to be here because we’re talking about global citizenship and the G8 meeting. I am thrilled that the G8 meeting is happening in Northern Ireland. Let me just put that on the table first because I think it’s an interesting place and the fact that so many people will come to that part of the world I think is a good thing in itself, although it may be a contested one but it’s still a good thing I think.
I didn’t realise that I was wearing the right colour this evening. This is a very red room and I don’t know if there is any significance in that but it’s lovely to be in the Tate Modern Gallery. I am a great fan of the Tate.
I am also aware that there have been a lot of meetings in London. I was here over the weekend for a meeting on nutrition which actually ended up in some good commitments on nutrition and linked nutrition to issues of health and water and, I am glad to say because it is my passion, climate change. And so I think we can have quite a conversation. As I look at the audience there are...it’s actually quite a young audience looking around. Not everybody’s young but to me almost everybody is younger than me these days! So I hope we can have a good diverse discussion when the time comes and I am very pleased that the panel itself is quite diverse and that we can have a good conversation.
There are sort of ways of being provocative about the G8 and I think one of the things that I’d like to provoke in our later discussion is how do we accommodate the right to development in the context of our world today. The right to development of those coming into middle class now. Who want the same lifestyle and consumer gadgets that we have enjoyed and that have been the product of the fossil fuel growth that is warming our world. How do we have a different perception of a middle class that can have a good standard of living but doesn’t have to be as consumer driven? These are one of the kinds of issues that we need to discuss.
We’ve heard the issues of how we address the balance of power that is changing in our world and I have great pleasure in reintroducing, because he was introduced to you briefly, Mark Moody-Stuart, who will give a lead talk and I have no doubt thoughtful speech. I have known Mark for quite a long time. His current position is he is Zamyn’s chair and he is also chair of the Foundation of the Global Compact and I worked with him on the board of Global Compact for a number of years with a healthy tension between us because I chaired the human rights group of the Global Compact and I kept pushing and he kept explaining and I kept pushing and he kept explaining! But it’s a good relationship. Prior to that he was chair of Anglo American from 2002 to 2009 and chair of the Shell Group from 1998 to 2001.
Well I have always found that Mark is somebody who thinks things through and even though I don’t always agree with him I value the opportunity to listen to him. So Mark, you have the podium actually. You’re the only one who is going to be allowed up there until I call on Ben Okri later so use your privilege.
Mark Moody-Stuart (MMS): Thank you.
Thank you very much Mary. Your successor as chair of the human rights working group of the Global Compact is Pierre Sane formally of Amnesty International and you might be disappointed to know that he asked me because he said he needed business in there to co-chair it so I’ve got in, I’ve got inside the tent now!
Like Hansierg I am a bit cautious about giving advice to the G8 and in particular the last time I tried to give advice to the G8 was in 2001 and with my co-chair of the G8 task force on renewable energy, Corrado Clini, we were going to make a presentation to the G8 meeting in Genoa and at the last moment we were disinvited at the request of the Bush administration. It was said that George W would not attend if we made the presentation. That probably did something for my streetcred but I am not sure if it did much for his education.
So caution is needed and perhaps we lacked diplomacy. There are other reasons. First of all, the G8 gets a lot of advice, much of it conflicting and second, as Ian Bremmer has pointed out in his talk on the G8 last night, that the G8’s a bit of an anachronism. Martin Wolf actually described it in this room yesterday as a zombie and he is quite clearly not a diplomat.
The G20 is much more appropriate I think and representative. Its members generate something like 80% of global GDP and its north, south, east, west balance is a great deal better.
The G20 also differs from the G8 in that it’s always involved business and even does so formally now with something called the B20. I regard this as a positive step but some would regard it as unacceptable access and Mary would probably be included in that!
So I had originally planned to draw on all the talks for recommendations but the range is just too wide. In both the Artefacts and Universities debate the impacts of business and markets were clearly important and discussed. On Monday Paul Polman, the boss of Unilever , a member of the G20, painted a very vivid picture I think of the role of a responsible business and he describes the approach as being not merely one that’s desirable but one that’s actually essential for the survival of business and if there to thrive. Businesses are not philanthropic organisations but that doesn’t mean, Paul Polman said, that they should not serve society.
The Economist expressed in a cover story a few years ago the concern that with cooperates responsibility and so on companies might misguidedly take on the responsibilities of government and indeed visa versa. They defined the responsibilities of governments in setting frameworks and priorities, providing for regulation, regulatory frameworks, providing public goods, regulating collecting taxes to pay for them and I think we’d all say amen to that but what about the large areas of the world where governments are either incapable or unwilling of doing those sort of things or worse still steal the means by which their supposed to do it or oppress and abuse their own people. If we want the sort of functioning society which we can do business, business needs to work with others to create the capacities and conditions in which we can work.
Now you may feel that the concept of business and civil society working to address issues in society which impact on sustainability and governance is a pipe dream, cloud cuckoo land. In fact I believe it’s the one are in the last twenty years where we have seen serious progress through joint action by business and civil society. It started in trade and with consumers. For example, WWF and Unilever working on sustainable fisheries, the Sustainable Forest Stewardship Council, and now there are numerous examples. Similarly the Kimberly Process was set up to deal with conflict diamonds and 99% of diamonds now go through the Kimberly Process and it helps prevent the fuelling of conflict. The voluntary principles of security and human rights were developed by governments, human rights organisations and responsible businesses to develop rules for use in cases where armed security is needed.
And there are two big advantages of business and civil society and indeed organised labour working in this way. First of all they keep each other honest and second the combination of business and civil society is more likely to be trusted than either in isolation, although of course civil society is much more trusted than business is and a coalition can demonstrate to government’s practical things which could be achieved. But if they’re to work together they need to build trust and trust depends on the business side. Businesses reporting very openly on their performance, not just financially but the impact of their business on society and the environment and this can be done using standardised indicators like the Global Reporting Initiative or now developing the Integrated Reporting Council Initiatives.
The largest of such multi-state holder organisations and groupings is actually the United Nations Global Compact initiated by Kofi Annan in 2000 and enthusiastically supported by his successor as Secretary General, Ban Ki-moon. They now consist of over seven thousand five hundred companies in a hundred and forty five different countries around the world employing about fifty million people. They have publically, each individually, publically committed themselves to embedding the major UN principles on human rights, environment, working conditions and anticorruption into their day to day business and the Global Compact provides a forum in which business and civil society and labour organisations can get together and talk about how to develop practical approaches to these rather high level issues.
And the Compact has been severely criticised by many as being voluntary and just talk or blue wash. I think that’s a little unfair because when companies sign up they have to do so in a letter supported by their board and they commit to report publically on what they are doing in each of these areas and if they don’t do it they get expelled from the Compact and many thousands have been expelled. Because people sign up with enthusiasm and then don’t do anything.
These reports are available for public scrutiny and can be used by civil society to hold business to account. So while the Global Compact remains voluntary it is driven by other things, shareholder interest for example is building, and a spinoff of the Global Compact, something called The Principles for Responsible Investment, has been adopted by about a thousand major long-term investors, mainly pension funds, who together control, manage funds of I think thirty three trillion dollars, an unbelievable sum, who have committed to use the principles of the Global Compact and reports prepared by companies relating to their performance in their decisions and at the same time those principles have been baked into things like the performance standards of the IFC and the World Bank and are supported by the banking sector equator principles which I think were referred to indirectly in the introduction.
So my first recommendation for the G8 and G20 governments would be to support and facilitate this process of business and civil society working together and developing a kind of form of soft power. They could encourage reporting, open reporting, in their own countries along the lines I have talked about. And they could also support the United Nations Global Compact local networks which are at present in more than a hundred countries and those local networks incorporate businesses of all size, big, little, national, international, coming together to work on the principles. The multi-stakeholder nature of those networks is absolutely fundamental and the concept of that work is not just a western conceit. Countries such as China and India and Brazil have networks and have recognised the benefits and their governments actually support the Compact. Networks are present in all G20 countries except Saudi Arabia. For example there are over three hundred Chinese companies in the Compact and the Chinese local network a couple of weeks ago, Mary will be very pleased to hear is strong, and held a workshop on human rights, which is quite something for China.
None of that absolves governments from their responsibilities. Businesses are I think, well the process, the responsibilities of business and governments were set out I think in John Ruggie’s great work on the UN guiding principles for business and human rights and Ruggie made a clear distinction between the states responsibility to protect the human rights of its people and business responsibility to respect those rights. He also added a very important third element of remedy. Businesses are clearly not responsible for all the actions or omissions of the governments in the countries in which they operate but they can contribute positively but only provided they diligently respect the various, these other rights and I think process identified by Ruggie in human rights can be extended to other areas.
For many years there has been pressure on businesses to withdraw from countries in which abuses occur and this was debated quite heatedly in the resources session a few nights ago. A responsible business operating to international standards such as those of the Compact and respecting internationally accepted norms I think can make a contribution to the economy, working with others in society to build capacity and raise standards of governance quite apart from any economic impact. But it clearly depends on responsibility and on a need to build trust.
That brings me to another recommendation for the G8 or G20. There has been a tendency of Western governments, particularly in the G8, to attempt to isolate governments which are guilty of human rights or other abuses and which don’t have representative governments. Now I think the expression of disapproval is entirely understandable although one has to admit that the selection of targets has actually be remarkably inconsistent and has been strongly influenced by perceptions of allies or spheres of influence which clearly lead to charges of hypocrisy or bias. Just think about the case of Iran. For more than thirty years the United States has lead largely Western efforts to isolate and impose sanctions on Iran. From my own experience, every time in the ‘90’s when trying to do business sanctions prevented this. Technocrats you were dealing with lost power and the extremists gained power and were pushed aside and that was not the only consequence. As a result of the private sector being choked off and any foreign investment also being choked off economic activity is increasingly in the hands of the government and the government's friends and cronies and now with very strict financial sanctions the private sector has been devastated and that has serious impacts on the population at large. And that’s not to condone or support in any way the present Iranian government but just to point out that our Western efforts over the last twenty years have in my opinion contributed to the situation. Had we done it differently the fact and attitude of the Iranian government would have been different and perhaps we should look at China. That’s a difficult proposition to prove but the alternative I think could hardly have been worse. In Burma the West also chose to impose sanctions and the RCN countries deliberately chose not to but expressed their criticism. Clearly the very steadfast approach of Aung San Suu Kyi played an important part, including her eventual preparedness to move forward in what one could say is a less than perfect situation. So I think the RCN approach was more effective. So my second recommendation for G8 governments would be that they should honestly sit back and review what are policies for the past decades of isolation and sanctions let alone military intervention has actually delivered and consider instead what a policy of trade and engagement could bring about. It could create an environment which was very different in which businesses of all types large and small could work to create the wealth necessary for society to develop. It doesn’t mean condoning or ignoring the manifest failings of many governments. It just means abandoning the use of economic sanctions as a weapon except in highlighting and targeting the offshore wealth of various leaders. I think sanctions could be replaced by softer power of social and economic engagement. But there is a proviso that companies and indeed the social and cultural organisations who are engaging in this behave in ways which respect the major UN conventions. That’s not going to be easy to achieve nor to monitor performance and there will undoubtedly be mistakes.
That means it’s also incumbent on G8 and G20 governments to ensure that the mechanisms by which remedy for damages can be enforced against those organisations and companies which cause it and whereby companies in their own jurisdictions can be held to account. It’s not possible to advocate that sort of thing, engaging in countries with weak governments without also addressing corruption. Perhaps the greatest global threat to economic and social development and governance and any attempt to corruption has to involve all parties.
So a third recommendation for the G8 is that while continuing to support the collectives efforts through things such as the EITI, the Extractive Industries Transparency Initiative, talked about last week in the resources programme, but they should work to ensure that the beneficial ownership of property in G8 countries and elsewhere is transparent and ensuring that corrupt proceeds can’t be hidden in G8 financial systems and shadow corporations in this city and others.
The principles of the UN Convention against Corruption agreed by member states, including the parts on asset recovery, should be fully implemented and at the same G8 countries could continue to tighten their own controls on corruption and legislation against corruption. But finally I’d say there’s probably no more egregious example of corruption then corruption in the international arms trade, quite apart from the human misery caused, perhaps through a misconceived perception of national interest this is able to reach in to and distort parts of society in even the most sophisticated political systems and the G8 could show a bit of collective leadership in this area.
Now Mary will be wondering how I’ve got so far in this talk without addressing climate which Martin Wolf did extremely ably in the FT a couple of weeks ago. The topic was addressed in lectures, mainly through references to alternative energy and energy efficiency and so on but frankly progress in the last fifteen years in any sort of international agreement and international carbon pricing mechanism supported by many in business has been dispiritingly low and the panel yesterday, I think it cause David Miliband, who said he thought that a global agreement on climate was unlikely in the foreseeable future. I must say I confessed to being somewhat resigned to this and to it happening on a kind of piecemeal basis as a result of corporation and others, consumers, looking for more efficient and less carbon intensive methods buttressed and supported by the work of things like the Carbon Disclosure Project. I think that China surprisingly which has on its own volition set quite challenging targets on energy efficiency per unit of GDP and carbon efficiency may surprise us all and that would remove one of the big obstacles to a global agreement. Meanwhile, I think we better all prepare and start preparing for adaptive measures. Unfortunately while I think in the developed world we will probably be able to handle this quite reasonably, the real impact will be felt in the poorer countries such as Bangladesh which can ill afford adaptation.
In the debate on capital there was agreement that regulation on capital was needed. It was pointed out that the major growth in Korea and Taiwan had occurred in countries with significant capital regulations. Yet in many African countries a lot of capital will be needed for infrastructure development and there’s clearly, I don’t have to say it almost, an urgent need for changes in international structures on taxation. Progressive companies such as mining companies I think already report on what taxes they pay to whom and where as well as their supply chain expenditure and greater transparency would clearly be beneficial. But there is also a great need for transparency between governments and, given the nature of modern business and the sourcing of materials, a lot of work is needed to ensure tax is paid in the country in which operations take place and profits are actually earned. It’s relatively easy and quite popular in governments to point at apparently anomalous tax behaviours and practices sometimes reprehensible by companies but these frankly stand from outdated systems which governments set up and governments need to change them. It won’t be easy to do it because they are going to be winners and losers but it’s something that should be a top priority.
Lastly, you’ll be pleased to hear, as G8 and G20 countries turn their minds to the post 2015 development goals they have to address and think about population growth and food. If we have a population of nine billion by the middle of the century, even if nine billion is a maximum, and numbers and changes in diet are going to require a very large increase in food supply and there is enormous waste in rich countries but this in my opinion is more a matter of individual behaviour and societal behaviour than anything that governments can do anything about. But on the supply side efficiency and agriculture in much of Africa and elsewhere is going to have to be radically increased in yields, in prevention of loss, in processing and in access to markets and as happened long ago in rich countries, it’s going to result in a movement of people from country to city. China is addressing this trend more successfully in that doesn’t have slums than many countries in the past but with clearly controversial methods of controlling the movement of people and having a very large migrant labour force of a hundred and fifty million or so.
To solve this problem without collateral damage is going to require a lot of careful governance and work. We are going to have to make sure that there is great care. That the existing rural population isn’t simply disenfranchised or dispossessed and I think companies such as Unilever and Nestlé, normally quite unpopular in some circumstances, have for many years demonstrated that you can install basic processing, equipment and develop scalable industries and that process is happening in China and in Brazil.
So my last recommendation for the G8 would be to look at that, identity examples that work and make sure that we can replicate them. Success I think could generate a great deal of wealth. Failure could result in dispossesses and dissatisfied people and more awful slums.
So in summary, recommendations for the G8 would be:
A very strong focus on transparency including comprehensive company reporting using indicators such as the GRI and integrated reporting systems.
To support business and society working together in movements such as the Global Compact, particularly in local networks.
To review the consequences of more than three decades of economic sanctions and military interventions and consider whether policies of trade and engagement might not have been better and what could be done to ensure that companies engaged in that respect international norms.
Transparency again, not just supporting efforts such as the EITI but ensuring transparency of the beneficial ownership of assets and facilitating asset recoveries and perhaps applying that to the arms industry as well.
Climate, I think it’s extremely important but I am not sure that the G8 is the forum to discuss it. I don’t think they will make any progress anyway.
On taxation there is clearly a great need for revision of international agreements coupled with transparency. In the meantime companies I think can contribute to this by a great deal more transparency in what they pay, to whom and where.
And lastly, feeding nine billion people is going to require not just less waste of food in rich countries which is up to all of us but harnessing the productivity of land in poorer countries and doing that without dispossessing or disempowering people is going to be a big challenge.
I think transparency is key to all of these recommendations, as is the need to involve different sectors of society and actually if you look at all of those recommendations, they don’t fit so badly into David Cameron’s proposed agenda of tax transparency and trade.
Thank you very much.
MR: Thank you very much Mark for that thoughtful address and for being specific in your recommendations.
I was interested that in the key first recommendation about supporting a process of business and civil society working together you did once mention organised labour whereas in fact the Global Compact makes organised labour a partner in that and it does make a difference if they are a part of that broad process of partnership and I think that’s...I was very glad that you referenced John Ruggie’s work and his guidelines on business and human rights which I think set a real standard of the responsibility of governments, the responsibility of business and the need for better remedies.
I am of course very disappointed that you don’t feel as I do that the G8 should actually utterly take on climate change as one of its priorities but maybe we can have that as part of a discussion later because if we don’t get that right there is no sustainable future and all the rest is aspiration in the worrying and unsafe world if we go too far above the two degrees Celsius, which at the moment we are heading towards, but allow me to retreat from being too inclined to express my own strong views and instead come back to my excellent panel.
I am delighted that Paul Collier has caught the right train and been able to join us from Oxford. I think Paul, if it’s alright with you, maybe I’ll let you...do you want to speak first? You are sort of first on the list but I was going...
Paul Collier (PC): Fine. Fine. How long have I got?
MR: You have got ten minutes maximum.
MR: Ok, so now that you are here and you have had time to settle I am happy to introduce you.
PC: Sorry was I supposed to speak from here or...
MR: Well I did sort of say that we could speak...I think...are you miked up?
MR: Ok, sit down then.
I have kind of been involved in the G8 agenda. David Cameron is keen on my work so actually asked me to set the development part of the agendas so let me say what it isn’t...sort of justify why it is what it is and then say what you could do beyond it.
The agenda starts with...I mean I should say my first advice was don’t preach. African governments are just sick to death of being preached at by British Governments and don’t promise to double aid or double this or double that when clearly G8 governments have absolutely no appetite or capacity to deliver on that. So don’t preach and don’t promise. Focus on putting your own house in order in ways that are helpful for poor countries. Just recognise that the G8’s own house is not in order and by putting it in order you can do yourselves a favour, ourselves, and help poor countries. And then focus down. Don’t try and do a laundry list. Get real.
So I like to think a G8 which is not theatrical. I think Gleneagles was a lot of pomp and fluff and theatre. Behind the Blair saves Africa was forget about Iraq and that’s I feel what was going on.
MR: Paul I have bad news. You haven’t got ten minutes. The panel has ten minutes.
PC: Oh I am so sorry.
MR: It’s not your fault. It’s my fault. I misread my instructions...so a concentrated...
PC: I have come a long way for two minutes.
What can we do that really helps others?
One is corporate tax. Clearly the rules need changing. It’s become a nuisance to the G8 countries ourselves but it’s been a scandal in Africa for thirty years and so addressing corporate tax avoidance is a really important thing.
Second, money laundering. African governments can’t do much about money laundering. But it’s the easiest point at which to fix corruption, to close corruption down. Money laundering is the getaway car for bribe money and whose doing that? It’s not lawyers in Africa, its lawyers in London and lawyers link to bankers so go for the facilitators. The G8 can clean this up even though African governments cant. And so that’s the second area, beneficial ownership.
And the third is transparency and extractives which is kind of not a new agenda but we can actually move it into the domain from voluntary to enforcement by mandatory reporting. Europe’s just done that, America’s just done it. We could scale that across the G8.
So those are three sort of attainable putting our own house in orders. When I say attainable they won’t be fixed in this G8 but a process will be launched which will, I hope, be unstoppable. For example you will notice that the secrecy havens. There’s been more movement in the secrecy havens in the last three months than in the previous ten years. That’s the shock wave in advance to the G8.
What else can we do? Finance for African infrastructure. There are huge pools of capital in western financial markets that are basically at the margin yielding nothing and huge needs in Africa where the rate of return will be really very high. And it’s trying to get a risk architecture which will enable African infrastructure to tap into global financial markets. That hasn’t happened yet but the G8 will make a start on devising a financial architecture which will include using public risk capital, public insurance schemes like a scaled up Meagre to try and get an architecture which links these huge needs for billions of dollars infrastructure with these deep pools of capital.
What will the G8 not do? So all those items need to be followed up.
So what will the G8 not do which I’d have liked it to do but it’s just proved politically too difficult? Not because of Britain. I would have liked it to see the economic partnership agreements in the European Union superseded. The deal I have been advocating for some years, which the African Union is keen on, is that instead of Europe saying we will liberalise against Africa is if Africa liberalises against Europe, say we will liberalise against Africa if Africa liberalises against itself. So market access to Europe as a carrot for deeper market access within Africa and I hope that that will happen but it will happen through the European Union rather than the G8 and in due course.
Just a flip remark on climate change. Let me then push back Mary and suggest that actually the right forum for climate change is not the G8, it’s the G20 because nearly all the big increase in emissions will come from the 12 not the 8 and I would like to see us getting really practical on climate change and concentrate on one thing that has to happen if we are to tackle climate change. We have to close down the world’s coal industry. And so I would...instead of all these woolly targets about degrees and emissions and so on I would just like a practical agenda for a sequential closure of the world’s coal industry because if we don’t do that we certainly won’t address climate change. That’s the most polluting emission. So there you go.
MR: Thank you.
Thank you very much Paul. Don’t worry, it was worth your train journey. It’s not just your initial words. We are going to have a panel discussion and then we are going to open it to this very attentive audience and you have overlapped a little bit, more than a little bit, with Mark on some of the areas that you have talked about for the agenda of the G8 and you have added other areas. In particular in relation to African infrastructure and the interesting moving away from the EU partnership agreements and we will debate climate change. I will get into that myself I think when the time comes.
But now it gives me great pleasure to invite Jamie Drummond. Your short at this stage so we can have a conversation. So I leave it to you to be as disciplined...
Jamie Drummond (JD): I will be brief and first of all we have got a great event outside which you are all welcome to, after the various proceedings here, there will be a wonderful film shown on the walls of the Tate Modern at about 10 o’clock tonight after this has hopefully finished, if that’s ok you are all very welcome. It’s actually an amazing film Richard Curtis made and it’s relevant to tonight’s subject. Its part of something called Agitate and it’s about getting the general public more engaged in the policy issues that the G8 are looking at. Exactly the things that Paul and Mark have already spoken about.
There’s not a lot that I disagree with in what Paul said about this G8. You know I think that what I’d like to particularly add is this morning Europe passed a law finally, there has been many iterations of the finalisation of this law, regarding transparency and the extractive sector. Now that law was passed because hundreds of thousands of people bothered to take action. They turned up in people’s parliamentary offices, congressional district offices. They signed petitions some of them. Those who dismiss clicktivists are wrong. We need people to take actions, even small ones as well as large ones. And the pressure that the companies felt and the governments felt has resulted in significant policy change and if people didn’t get you know off their backsides sometimes and take action these policy changes wouldn’t happen. And it is essential that there is a more informed global citizenry, this is subject here I believe is global citizenship, a more informed global citizenry taking action and keeping politicians...put it like this...working with the politicians on the inside who want to do the right thing and holding the politicians who do not want to do the right thing accountable. I don’t like the idea that we’re always about finger wagging at politicians. The ones who are good need help. They need a hell of a lot of help. The ones who aren’t need to be held accountable aggressively. And often the ones who want to do the right thing actually encourage more pressure.
I want to correct if I may or disagree and have an argument with Paul about 2005. I don’t think what Blair was about was purely about Iraq. It was in response to a multi-year campaign by the British public to do more in development. That’s what it was about and we campaigned very hard for that over many years and it manifested in bilateral debt cancellation, multilateral debt cancellation and that’s where the promises of aid came from. It came because we all asked for it. It wasn’t some whimsical gesture by the political elite. It’s actually something we all campaigned for. Millions of people across the country. Some people may think that was the wrong ask but it is actually what we asked for them to do. And by the way, as a matter of feedback, it would be utterly irresponsible for campaigners to ask people to take action, politicians to change policies and then not give people feedback on what happened.
And one enormous failure which I think a lot of people should be held accountable for outside of politics is why is it that nobody knows the good news. We are going to hear a lot of bad news about some trends through to 2030 that should worry everyone in the room about climate change, population growth and so on but the great news it that a lot of this campaigning together has worked, it has achieved results you know. Debt cancellation cancelled one hundred and ten billion dollars of debt. You know the campaigns on aids has helped put now nine million people who otherwise would not be on these life saving drugs on these drugs. Three hundred million people have been vaccinated saving 5.4 million lives. Child deaths down by 2.65 million a year in the last decade, that’s, you know, I think it’s something like seven thousand kids not dying a day. And Mary you are very involved obviously in the Global Alliance of Vaccines and Immunisations and know about some of these statistics. This stuff happened because people came together and pressed politicians to take action. I doubt very many people in this room know about the results of all of this activism and that’s a huge problem that I think people need to come together and address, which is why do you not know the good news?
The reason I am saying that good news is not just to say hey everything is on track, it’s all going to be fine. It’s because you know I feel passionately that if people don’t know that activism works, don’t know that pressing the G8 like we have gathered next week works, then why would you get engaged? And we have a problem. We have a lot of people who are not sufficiently engaged in these issues and we need to find more creative ways, we are trying one outside right now and inside here, to try and get people more engaged in these issues because if we don’t, you know, there’s two essential trends you could say. In the Global Trends 2030 Report by the National Intelligence Council, which I am sure you have all read, which says on the one hand you know we have got this massive population growth, we have got a massive growth in the middle classes, they are all going to want the stuff that we have here, quite right, and on the other hand...and that’s all pointing towards you know going after resources which are in very vulnerable parts of the world and that’s going to cause all conflicts and we have got to worry about that. We have got climate change compounding the problem. A lot of these resources are in places that exemplify what we call the three extremes. Extreme poverty, extreme climate and extreme ideology. And you know trying to imagine that is going to be very difficult into our future through to 2030 and beyond. Against that we have these more economically and politically empowered, socially connected, technologically connected people around the world who don’t necessarily always obey what’s going on within their country. They are global citizens. The point of this evening. And if we can help connect those people around the world, help them take bad politics out of good policy and try and push the better policies through and stop the dumb policies, we’ve got a shot at not screwing this up in the next fifteen/twenty years. But if we don’t connect those people, we don’t help provide them with information so that they aren’t in a position to hold politicians accountable or help the good ones I think we’re in trouble. So we have got to scale up the kind of campaigning that I think we have seen in this country work very well and I think we are seeing it work quite well right now with this government although there is a lot more to be done. It’s actually, you know, there’s some real progresses in made and we’ve got some good things on the agenda for the G8 which I haven’t really talked about very much because Paul said it all but I wanted to make that bigger point about campaigning works, events and forums like this work. We need more of them and we need people more engaged.
MR: Thank you very much Jamie. People power matters. The importance of being engaged an indeed increasingly trying to make connections with global citizens in other countries and other parts of the world to hold governments accountable and try to press for progressive reforms.
My last speaker on the panel, Strive Masiyiwa, you’re from the continent that we have touched on a little bit so you have a particular authority on this panel to instruct or push back or more than anything else advise the G8 on what really would be helpful.
Strive Masiyiwa (SM): Thank you Mary.
I had my opportunity last year as you know to advise the G8. I was invited to the summit by President Obama. As we were preparing for this, we spent weeks on end preparing for it, and then somebody told me that you know you are only going to get two minutes...
MR: Just like this probably...
SM: [Inaudible]...more generous with the time.
Can I have another two minutes... thank you.
You know Jamie talked of good news and there’s a lot of good news coming out of Africa at the moment, particularly on the economic front. I mean these are real...this is real good news when we talk about the GDP growth, we talk about the fact that out of the ten fastest growing economies in the world six are African. That’s been sustained now for over a decade.
Governance, you know I say this quite often which surprises people, that there’s been an extraordinary improvement in governance coming off a low base yes but Africa is very well governed these days. If you have lived there all your life like me, well most of my life. If you are a businessman who’s never been able to travel across Africa and do business in Africa as Africans to the scale that we have done we are able to do today and that is good news. But I am on the Africa Progress Panel and that’s the...and I have been part of the process of compiling the report on where Africa is. And the issue that brings me today for us to discuss is our report this year which are the natural resources and Africa’s natural resources are playing a particular role in the good news in terms of economic growth but there are challenges there which is that of equitable growth and development. We are not, with all this good news, we are not seeing real impact on poverty alleviation. The levels of unemployment are, if we spoke statistically, are extraordinary.
Over 40% in quite a number of these counties are resource rich. How do we take something that has been in the womb of the earth for millions of years and bring it to the surface to the benefit of everyone? I think that core guiding principle must be use it in a manner in which is as sustainable as possible, as generational possible. Infrastructure, education, health. Addressing abject poverty and ensuring equitable growth.
I will stop there. Thank you.
MR: Ok, thank you very much indeed Strive.
We now actually have sometime in the panel before I open it to the floor to discuss some of the issues that you have been addressing and since I think all of you in one way or another addressed the issue of natural resources I’d like to maybe tie it to one of the recommendations, I think it was the second recommendation that Mark mentioned, as to whether we need a different approach to governments that are not adhering to standards of governance and human rights but have...as to whether they should be isolated or whether we should do business with them and he referenced for example Burma Myanmer in the past. And I say that because I think very often it’s because there are natural resources and minerals in those countries that people are willing to do business with them. So who wants to take up that challenge of whether there is a better way of trying to encourage good governance in these countries by being willing to do business or whether it’s better to address through different types of sanctions.
Paul, perhaps I could ask you to open up on this?
PC: Yeah, sure. I think the...Strive is right that the issue here, I think of it as stewardship really, that the present generation in Africa have a responsibility of stewardship from depleting these natural assets and needs to hand on to the next generation other assets of at least equal value, preferable stuff that’s more productive. And so getting a narrative of good stewardship across the continent is enormously important and that is core role for leadership but it’s fundamentally African leadership that’s needed there. I am wary of the G8 getting on a high horse and preaching to Africa what Africa’s got to do basically. I think that’s a bit....but Mary’s issue of, you know, should there be rules which say in some conditions companies shouldn’t really get involved in depletion and I think that the answers probably yes. For example, in the early transition in DRC when there was a transitional government, ministers in that government new that they had only got a short period of power because it was a transitional government and they sold off assets very cheaply in a context where all that was going to happen was that they were going to enrich themselves basically. And so I suggested at the time that there needed to be some rules which said no. That this is not an appropriate context. The real issue at the moment is Somalia. Just last week I was with the Somali Minister of Finance and Minister of Natural Resources and they actually struck me as really very decent and thoughtful people but it’s scarcely creditable that Somalia is ready for a lot of high value resource extraction because the deferral government doesn’t even control of its territory yet. And so what’s happening at the moment in exploitation in Somalia is actually heightening the risk of conflict as the various sub national entities compete with each other to claim more territory and so this is a potentially aggravating process at the moment so it’s something which held back and I think there’d be a good case for saying if there’s no mining code, if there’s no EIDI then companies should be very wary basically.
Just to come back to Strive’s point about the Africa Progress Panel, which this year was magnificent I must say, the most striking numbers to me in that were that the capital outflows from over invoicing and basically money laundering were more than double the aid inflow. And so if we could actually address money laundering and over invoicing, and that is within the G8’s power to do something about that, that is going to make a bigger impact on Africa now than promises to make aid which we then don’t keep. So I think that the Africa Progress Panel really reinforced the case for doing this agenda of corporate taxation and beneficial ownership.
MR: Thank you Paul. I must say I also welcomed the Africa Progress Panel in a particular way because I now have a responsibility as the United Nations Special Envoy for the Great Lakes under the RC and we have a framework that was signed on the 24 February 2013 by eleven heads of state and is guaranteed by the four keys institutions, the UN, the African Union, the International Conference, the Great Lakes and SADAC and it has two oversight mechanisms. One a regional one to stop supporting armed groups, to stop supporting bad perpetrators, to stop exploiting in other countries. And the other is the national mechanism in the DRC itself and one of the key issues is going to be how to address this issue of natural resources and it’s going to be fundamentally...you know it’s going to...and the exploitation of conflict minerals has been part of the problem of the terrible sexual violence against women and girls so it’s all...it’s very much tied in...
PC: I was in DRC last week addressing on...natural resources...
MR: Yeah, I think we will have to try to bring together you know sort of expert...the EU as you say has just passed legislation, there’s the EITI, there’s the African Panel. Somehow you have got to bring all those together to discuss.
JD: I mean Paul’s written about this plenty and I am sure you have all got his books. I mean there’s one thing that I think there’s a distinction between countries which you know have governance of some variety that is not necessarily generally considered the worst but natural resource addiction and complications coming with that are already very entrenched versus countries which, for the first time round about now, are discovering that they have got a truck load of resources the world wants. And there you have, I mean just to...not to forget about the countries that are already down a certain kind of slippery slope but tactically and opportunistically to see where you can get ahead of the curb and try and help things not go horribly wrong. The Tanzanians, the Mosambiques and so on would be a good use of peoples time and resources although of course Mozambique has discovered a lot of coal and I am not sure how they would respond to your comment about coal and they would probably say fine if your prepared to write a cheque for, I don’t know, a couple of billion dollars a year to replace the revenues that they will not be getting from selling that coal to the Chinese. I don’t know if you have had that conversation with the Mozambican Finance Minister.
PC:...in hot pursuit. What would be a sensible plan for closure of the world’s coal industry. I think the key word is sequence. You start with the richest countries and you work down and you say we are not moving onto the next until whichever country is now in the top of the list actually moves. So Mozambique will be some years away but it gives that way instead of saying oh you know this is everybody’s problem you try and turn it into a specific problem of one industry and one country at a time and that rather sort of concentrates responsibility I think. That’s the idea.
JD: Can I share one thing that I just find really shocking that I think is focusing our minds at the moment regarding countries that are already down the slippery slope. Nigeria, a country that we all know is vital to so many concerns. You know that country made somewhere between fifty and sixty billion dollars for the last year that the EITI has accounts. In that same country one in eleven children who died under the age of five were Nigerian and one in seven women who died in the world in childbirth were Nigerian. By the way mainly from Northern Nigeria. And you know an absolute pandemic of mistreatment in the context of a country with extraordinary natural resource wealth.
How is this possible? What is the kind of activity that we, as global citizens and the G8 as global policy makers who are trying to be helpful not hurtful, what are the sort of things that we can do globally and then specifically what are the things that Nigerian citizens and anticorruption campaigners, transparency campaigners and so on should and can be doing? And how can we help them because the anticorruption campaigners in that country don’t have it easy and they need help.
MR: Mark, I’d like to bring you back in this because that was one of your themes in a way and Nigeria is a country I think you know...
MMS: Yeah I lived there...
MR: For lots of reasons. How would you...I mean it’s part of what you were saying, we need a different approach to countries that have problems but need us to address them in a more nuanced way or more long term way.
MMD: I think Paul’s point about having a period in a country and confusion, DRC and so on of trying to have some kind of suspension of production of natural resources has some merits. The problem is that you could apply that to western companies but it wouldn’t apply to everybody.
So my approach tends to be much more to say can we work with, in the extractive industries, with Chinese extractive companies and so on and voluntarily, because it would have to have to be voluntarily, because the Chinese are not going to and many other countries are not going to and it’s fine to say they are not going to accept mandates and you would never get a UN agreement on it. So in a messy world you have to try and build coalitions and that’s why I am enthusiastic about trying to get business people to say, because there is an international language of business and they can actually see common advantages.
MR: Have you got examples of Chinese companies that are willing to voluntarily accept...
MMS: Well nobody has tried it.
Oh yes, no. International standards. Yeah, many of the Chinese state companies. I mean they have signed...they have signed up to the thing.
MR: Global Compact companies..
MMS: Fu Chengyu, the Chairman of Sinopec is on the Global Compact Board and he is a very intelligent person. And these companies are well aware of the problems and China is well aware of the problems. There aware of their internal problems. When Jiabao who said, what was it, that their economy was uncoordinated, unsustainable and something else which I thought was refreshingly honest and could well be admitted by some of our western leaders.
So I just approach it from a different way, not to try and sit in the west. And I know you’re all enormously excited about European Union legislation and US legislation to make mining companies and oil companies report in the minutest detail as to what they have done with their money. Yeah, good, ok. I don’t think it will make a row of beans of difference frankly except to involve an enormous of work. The EITI countries, you have some kind of commitment from the government of that country. So when you talk about Tanzania or Mozambique who I suspect are, I don’t have the list in my head, are signatories of the EITI, part of the commitment that they make is to set up civil society panels and that to me, even if corruption continues, if you have an independent civil society panel it’s huge progress.
MR: One of the things that Paul mentioned is finance for African infrastructure, the risk architecture. Strive maybe, I mean you’ve talked about the way in which African countries are seeing unprecedented growth and very encouraging growth. I know this from my involvement in the Mo Ibrahim Foundation that you know Africa is changing in a very, in many ways, in a very positive way but what about the problem of financing the infrastructure? Again, look at the DRC? You know the need for huge financing there.
SM: You know Mary twenty years ago the statistic for telecommunications, the industry I come from, was that less than 1% of the African people of the population had access to a telephone in terms of what we call penetration. Today most African countries are well over 70%. There’s more than six hundred million people in Africa with a cell phone and that is infrastructure. I will to see that in power, I would like to see that in water, I would like to see that in roads and ports.
But you know when I talk about my industry, telecommunications, that would not have happened without China. China has funded most of their telecommunications infrastructure. The truth of the matter is, for telecoms entrepreneurs like myself, to build networks in Zimbabwe and Burundi we would not have got it out of western banks. We got money out of China.
So if I were to give a recommendation, I wonder about when you should give the G8 a recommendation because they are from my experience things have been locked up now but I would say look at what China has been doing. Because it is China really which we are talking to about ports and roads and railways. There is a lot of talk in the west but the truth is it’s the Chinese who are coming to the party and Africa is increasingly looking to the Chinese. I don’t know whether we will be sitting and talking G8 meetings in five years time that will be relevant to Africa to be honest with you.
MR: Except if I may, the Chinese investment in Africa is large projects whereas despite the statistic you mentioned and the wonderful spread of cell phone and the leapfrogging into communications with cell phones which is remarkable, you still have of the 1.3 billion who don’t have access to electricity or the 2.6 billion that still cook on coal and firewood and animal dung and ingest these fumes, a lot of them like in Africa and there in rural communities. How do we get to the poorest with possibilities of renewable energy off grid, clean cooking stoves, lights that are now available? Is it possible to use, for example, social protection systems but then business doesn’t work easily with the social protection systems in countries but that’s where the poor are known to be in and identified.
SM: That is so true and like I said, we need to begin to...if we can duplicate in other areas like power, energy what we were able to do in telecommunications. So there were lessons there. Principal to those lessons was creating the correct policy environment for the private sector to come in because that infrastructure was not built by governments. It was built by private companies. You can’t run away from...African governments themselves must create a policy environment. I was in Nigeria only yesterday, seems like a long time ago, and I was talking to the Finance Minister. We were talking about this very issue about energy and she talked about all the great things they are doing to open up the power sector and I said Ngozi, still the people in the rural areas will not be on the grid. They have to look at solar power. And she said yeah, yeah we are talking about solar. I said why don’t you just start by removing some of the duties on simple things like solar lantern so we can ship them in. And she’s very smart and she said they’ll get it done. So...
So I just wanted to comment on something earlier made by colleague earlier on. You know when the US government passed the EFCC, the Anticorruption Act, when I read it it was horrifying. Just like the British Anti-bribery Act. And my colleagues who American businessmen and British businessmen, first the Americans, talk how can we do business in Africa. But you know looking back at it today and the conversations in the boardroom, because I see it from the boardrooms where we are sitting with American partners and American directors, for the first time the boardrooms were how do we stop bribery, how do we stop corruption, how do we stop our people taking bribes. It works. That legislation works. The answer is not to knock it down but to make it more global. So that the French are in. So that all the G8 are in. I would like to see the same platform of the anti-bribery act because you see no matter what we do in Africa, and this is by no means to exonerate anybody in Africa, but to enforce, to pursue the kind of people who are involved in this type of...no African government has the capacity to do it. But when the US Justice Department said we will take out any director who is in a boardroom where bribery is taking place on the ground. No American companies will play around anymore. No British companies will play around anymore. It works.
MR: So that’s your recommendation to the G8?
SM: Oh absolutely!
It gets done! It’s painful. You know people complained. Some said we are not going to do business in Africa. We are too liable so forth. But you know what, people soon started to sit down and say how do we get this done. Ok. I’d like to see it into the G20, with China and Brazil. Then we are talking. But for now let’s start with all the G8.
MR: Ok, excellent point. I am now going to open it to the floor because this is a panel about global citizenship and you’re as entitled to be involved as anybody.
The gentleman in the white shirt was the first hand I saw and just wait for the mike, wait so that you can be heard and there’s another here. You’re next. And I am hoping I will get a female. I am looking for a woman at this stage...just get some balance. Yes, ok.
So you first. Yes please.
Audience 1: Hi. I’ve got a question for the panel and it’s to do with resources and peak oil will hit eventually...
MR: Do you want to say who you are?
Audience 1: My names Hussain Shaffy. I am part of an organisation called Lobby.
We were talking about resources, natural resources. So peak oil will eventually happen and people were talking about we should have a stewardship of what happens to the natural resources. Well guess what, every single gram of every single resource that goes into making a mobile phone will eventually run out. Those are mostly come out of the Democratic Republic of Congo and one day they will run out. Those materials are going to be needed by society over the next million years. Over the last hundred years civilisation has moved so fast, so forward basically, that we are going through natural resources at a rapid rate and it’s an increasing rate. It’s not diminishing. So we are going to run out of resources very fast so when you say stewardship should be regional countries in Africa actually it’s the responsibility on a planetary level. Everyone should be very careful what you are doing with natural resources that belong to every single human being on this planet.
MR: OK, thank you very much. I’ll put that to the panel.
The gentleman here and I’ll take the one over here and then we’ll go back to the panel for comments.
Thank you. So please just identify yourself and then...yep.
Audience 2: Thank you. My name is Lennon. I am a student.
I just wanted to ask Mr Masiyiwa [inaudible] because I am honoured what are your thoughts on Zimbabwe’s situation in terms of the complexities that you just highlighted, China, natural resources and sort of the developmental path the country is taking.
MR: Ok, I think that must be you Strive.
Audience 3: I thank you. My name is Bunmi. I’m a reporter with Africa Today Magazine.
We have been here before and [inaudible] Madam Robinson ....we have been here before. I have met you before. We have talked about several topics. Poverty, human rights, war, Africa, hunger and we are still here today, still beating the same drum. June 12th 2013.
What has changed? What have we missed? The G8 is here again. The G8 will come again. And why are we still talking about the same thing? In fact it’s becoming clear that the G8 is not about the eight heads of state. It’s becoming a media spectacle. That is, I am a journalist, I know that, I agree, what is becoming a journalist jamboree. That is the number of journalists that are facing this G8 that matters not what the G8 achieves. What is different madam Robinson, please?
MR: Ok, thank you. I will take that one later. I will just take one other question because I see another female hand there. As you can see I am clearly biased...
Audience 4: Hi. Amelia Baracat I work in Kew Gardens. It’s just a general question about the relationship between China and Brazil and China and India and what the panel think what are the positives about these relationship and because from my point of view is actually very detrimental to the environment and deforestation and the productions of food and that’s why China is probably investing huge money in both countries because exactly the need those lands and there is a huge debate about how they factor on conservation of the forest in these places.
MR: OK, thank you. I think we’ll take these four and then I’ll come back to the floor again.
Paul there was a question of resources and stewardship and peak oil, the role of the DRC. Do you want to take that one?
PC: Yeah, ok. I mean let me be honest and clear. I don’t buy into these sort of doomsday concerns about running out over the next million years. Sheikh Yamani got this right about thirty years ago. He was the head of OPEC. He said the world didn’t move on from the Stone Age because it ran out of stone. You know we will move on from the oil age. I doubt we will move on from the oil age because we ran out of oil. We’ve already got more oil than we can safely burn consistent with climate change so actually some of the oil is going to have to be left in the ground. I am an economist so economists...basically there’s a very simple idea that when stuff starts to get scarce it gets expensive and as it gets expensive that induces innovation to find alternatives to it and that’s worked every time so far. The world is such an amazingly innovative place. The big resource of the world is not what’s under the ground, it’s what’s in our heads. So I just sort of rely on that.
Can I just respond quickly to a couple of the others?
PC: If you think that this year’s G8 is all motivated by media spectacle try explaining beneficial ownership to a big audience right. I mean the public relations people are worried that this is so technically complex an agenda that how on earth are they going to explain it to people so I don’t think it’s a fair accusation to say it’s been driven by media.
Just a little remark to support the point that Chinese companies are all rogues. I gave a key note address at something called the International Conference on Business Ethics. It was in South Africa two or three years ago. And there in the audience were a whole row of Chinese and they came up afterwards with interpreters and said this is the Chief Executive and his team of one of the really big Chinese companies and we come to this international conference on business ethics because we just try to understand how are we supposed to behave in Africa, you know. We look at others, we see what they do, we see what’s expected of us, basically bribes. What are we supposed to do? So the idea that they are all rotten to the core and will be rogues whatever I just don’t think is right.
The G20 is a vital institution. It’s a new institution, a vital institution and it’s not the case that we can just pass an agenda on from the G8 to the G2O but in some spheres unless the G8 puts its house in order first there isn’t a hope of the G20 moving on it. So that seems to me a reasonable proposition. Let’s clean up our own act and then hope that the G20 led by South Africa say well these are issues important for Africa, we’ll put them on the table.
MR: Thank you. Strive, I think the student wanted you to develop some of your thinking on the African prospective. I mean that’s what I understood.
SM: I have nothing to say about Zimbabwe. Thank you my brother.
MR: Ok. We’ll leave that one since we’re ranging more widely.
Jamie, I’ll come back to the what has changed but let me start with you. You have followed G8 pretty closely, so what has changed from your perspective?
JD: CNN once did a story on me calling me ‘the G8 junkie’. I used to have a tragic existence where I’d follow every single sub clause of each line of every communica paragraph, I loved it by the way, something very strange happened in my head and I was very excited when we got a clause in about extractive industries transparency by the way in 2003 and from these things, you know, and Blair by the way was moderately helpful on that in the early days, wasn’t he? Absolutely.
And I find myself also sometimes in the odd position of I was at the Genoa G8 when you weren’t allowed in! I was let in! What’s that about? And we were having an argument with at that time Condoleezza Rice about deeper debt cancellation and more moves on the African Growth and Opportunity Act which helps third country fabric provisions. Quite helpful in providing jobs in some countries in Africa. And so I suppose the point is those details matter and the politicians put in those sub clauses when we put enough pressure to do so and you need to be partly in the room having a conversation with them and partly having a conversation with the public about what’s happening in the room. And those two things need to be going on and I think we’ve seen quite a lot of specific important changes.
My frustration is that we haven’t taken those to scale. So I am not trying to argue with you that everything is great. It so isn’t. It so plainly isn’t. But the specific things that we have worked on when we have got our act together, we have made a difference. My frustration, I sense with all of us, is why haven’t we taken to scale our ability to change policies, persuade the public?
I just want to agree 100% with Paul, so we have got a team of people right now trying to explain what beneficial ownership is, what multilateral tax conventions are, what capacity building for the tax revenue collection authorities are. The reason all of this is incredibly important is because hopefully it will increase the tax base of developing nations so they can fund their own development and in due course very soon not require any add from us at all. And that is you know...aid is an incidental by-product of a much better thing. Not needing aid is an incidental product of a much better thing which is that the domestic resources in developing nations can pay for the development of those countries. Just a fact to leave you with. In the ten years since or twelve years since I have been a G8 junkie aid to Africa for example has doubled from twenty to forty billion dollars a year. That’s not very much. It’s something. But the big picture, the important thing, is that domestic resource mobilisation within African countries has gone from seventy billion a year to three hundred and eighty billion a year and will be four hundred and sixty billion a year in a year and a half’s time. That money and how it is spent is a really important question. How our aid can possibly help and not screw things up and maybe help a little bit and making sure some of that money is better spent is part of the things we need to put on the table. A little bit. But you disagree but let’s have that conversation.
[Inaudible comment from the audience]
JD: I am sort of agreeing with you, I am saying:
MR: You are sort of saying....moving away from aid...
JD: There is an important transition you know. If you stopped aid right now a lot of people would die and that wouldn’t be necessary. So let’s get the transition right.
[Inaudible comment from the audience]
JD: I factually disagree with you I am afraid.
MR: Mark, the question from the woman from Kew Gardens about China and Brazil. Do you want to take that up a little bit? It’s the wider I think G20...the readjustment of power in our world.
MMS: I’m actually quite optimistic about China because I think they are unusual in having not not a democratic government but they have an extremely technocratic government. Their run by engineers, they have let an economist in but most of them are engineers. The previous Premier was a geologist like me so he must have been a good thing. And they are extremely rational and they have quite consciously I think gone for and they’ve had a remarkable progress on poverty alleviation with systems which are, from our point of view, by no means perfect. One child policy, Hukou systems preventing...
MR: And are they doing enough on the environment? I think that was the thrux of the question.
MMS: I think they are now coming to the environment and I think they are, as I said they’ve set targets on energy intensity. They set them five years ago and they met them. They are the only country in the world which actually sets a target which is a rational target which says we want to limit energy intensity per unit of GDP which is what we all ought to be and carbon emission.
So I think you know they’ll get there and as I said in my talk I think they will actually help greatly in climate. And not just one, if I’m allowed one comment on, I agree absolutely with Paul’s statement on resources, except, I think on fossil fuels. Like you if it wasn’t for climate I would be entirely relaxed about the using up of them because I don’t think we’d ever get to the end. The problem is with climate there is an element of urgency in there which trumps economics.
MR: So you agree then that part of the fossil fuel will become stranded assets because we won’t be able to use them.
MMS: Yes, I think...I mean if it wasn’t for climate I agree with Paul, it wouldn’t all be used anyway because we’d have found something else better, more convenient.
MR: And now we have to do it more urgently.
MMS: Yeah. Urgency is the problem.
MR: Ok. I am going to go for two more questions to the audience. I think that’s probably all we have time for. You and then the gentleman behind.
Audience 5: Thank you very much.
MR: Just wait for the mike and if you wouldn’t mind just identifying yourself.
Audience 5: Barbara Frost from WaterAid. I found that a really stimulating discussion. Thank you very much. And it has set me thinking.
We’ve been campaigning for a world where everybody has safe water to drink and decent sanitation, toilets, because we know that’s one of the area’s really holding back economic and social development and we work through citizens action and peoples movements but looking ahead in our next strategy or our next few years who should be work with? Should we be working with governments? Should we be working far more with the private sector? And how should we work as an NGO that’s really trying to bring about change in something very basic, water and sanitation.
MR: Thank you very much, very good questions.
Gentleman in the few rows behind.
Is anybody absolutely desperate to ask a question? I could take maybe one more if somebody is absolutely desperate. Alright, we’ll take you.
Audience 6: My name is Joseph Wicheno. I write and commentate on African affairs.
I would just like to make a quick observation to the G8 that perhaps they should spend less on figures and statistics and probably visit African villages like I do and that they’ll probably realise like in my own village in Uganda what I saw when I was growing up in 1970’s is not necessarily what is there today when it comes to health and education. In fact the education I had helped me reach where I am, amidst all the wars.
The only other thing though is that, for you Mary, in your other capacities, if you don’t mind, going to Congo since it has already been mentioned, I wonder whether the G8 could work with you slightly more, the UN, and follow up the challenges about the pending issues in [Inaudible] especially referring to the two countries, namely Uganda my own and Rwanda who are named as net contributors to crisis’s in that country and I am saying so because I am simply concerned that there is a lot going on on the continent and I write on these issues and have been talking about it today but I rather think that there is an element of impunity within the continent by minority clique of established leaders with good ears in the west and many of the G8 countries simply because nobody else would tell them who to have conversations with on the continent.
MR: Ok, thank you for those thoughts.
Now there was a gentleman there with an urgent question and then I will come back to the panel briefly and....yup.
Audience 7: Hi, I’m Shaval from the School of Oriental and African Studies which is right behind you actually.
I want to make a quick point actually. It’s Malaysia and not China who’s the biggest direct foreign investor in Africa.
Secondly, in relation to that point, there was mention of sort of I think it was Paul who was mentioning earlier about developing the financial architecture to try to figure out how to channel capital into Africa. What surprises me so far is that there’s been no mention of the G8 itself actually investing in Africa. It’s more...you’ve talked more about sort of a role of facilitation and advisory role but less about sort of directing capital not in the form of aid into developing nations and I just want to sort of get your feedback on that.
MR: Ok, thank you very much. Interesting point.
So the first questions from WaterAid. Safe water and sanitation, who to work with. I’ll invite anybody from the panel.
MMS: All these sessions are recorded and streamed and you can get them on the internet and I really would recommend that you watch the one from Monday night with Paul Polman ...oh you were? You have seen it. Exactly.
So I think what you need to do is to find...well I mean Unilever makes a business out of it. Selling soap basically. But he does it with a passion as soap as being a benefit. He is selling a social good. Now I regard selling oil as a social good but not everyone would agree! He does it very passionately. So watch it. It’s really very good.
MR: In fact if I can put that in a different way, Paul was also, Paul Polman was also a member of the high level panel that just reported on the post 2015 agenda and the title is really Global Partnerships and I think that’s probably the wisdom of the global partnerships being government, private sector, NGO’s, wider civil society, women’s groups, social sectors that are increasingly becoming involved. You know the informal sector organising which I think is becoming a real partner on these issues as well.
The next point was really I think the challenges of impunity which I certainly relate to and I can very much take what you said about the need to address these issues, particularly in the context of the Great Lakes but also what you said about the need to know what’s happening in villages and link the voices of those who really know what’s happening in food and nutrition, security for example, access to energy with those who have power and influence.
But I want to pass on the question of investment, the G8 investing in Africa. Perhaps both to Paul and to Strive. Maybe you first Strive?
SM: You know when in 2006 when President then Senate Obama came to Africa. What a wonderful conversation about investment in Africa and then last year I was amazed when we went there that was the first question he asked me about. American companies investing in Africa. He said where are we? And I tell you what I said to him, you know if I were charging consultancy fees for every American company that is enquiring about investing in Africa at the moment I could start another business. So when we talk about investment, G8 investment, of course we are talking about companies. It’s about a Unilever, it’s about a GE, it’s about an IBM.
One of the most exciting observations we are seeing is tremendous interest in movement. It’s not across the whole of Africa but certainly I would say it’s encouraging. China, of course, we see government related investment where the state is participating through China Development Bank. But it’s a different model. But I think the interest from G8 companies, investment funds, for example private equity funds, looking at Africa today. There is so much money from private equity funds for Africa. The actual problem is getting good, what the call, good deal flow. The banks, the Barclays, the Standard Chartered, the South African companies. I mean we talk about the west but corporate South Africa is moving up north at an incredible pace. So you know that’s good news for you.
MR: Paul, can I invite you?
PC: Yeah, I mean there’s an enormous amount of international business interest in Africa and most is not within its comfort zone yet. So I think there’s a role for public risk capital in just brining this huge wave of interest into its comfort zone. And just let me finish with an example of where that worked and its mobile phones in Mo Ibrahim. I was with Mo last night. One of the things that really helped Mo get going, because before he was a telecoms engineer. That was his doctorate. He saw an opportunity and he went round the big international telecoms companies and said, you know, why don’t you do this in Africa? And they all said, you know, no. And so he thought I’ll do it myself and then he needed risk capital and at that time CDC, old Commonwealth Development Corporation, was in the business of public risk capital and so they funded him and that’s one of the things that really got Mo going. CDC then stepped out of the business of public risk capital and has just stepped back in it this last year and that seems to me, that public risk capital role to be really the future of aid if you like. Just gearing up so that you bring private business into its comfort zone into Africa because Africa sorely needs modern private business.
MR: Thank you Paul. Jamie, a last thought?
JD: Well quite a few. Is this a wrapping up moment?
MR: It is but a short one!
JD: Alright. I mean there’s one sort of massive piece of schizophrenia about all this which is when we are calling for investment into Africa and trying to get away from the aid narrative for example into that trade and investment and partnership narrative which were amongst others trying to be part of the Africa rising, you know, not do that, you know the old stuff that’s a legacy of the ‘80’s in certain ways. And then as soon as you get into that you’re suddenly accused of oh it’s land grabs its investment, it’s the nasty private sector and all the rest of it and I think we need a kind of really intelligent conversation with civil society about what really makes sense here.
We are having a big old fight right now with George Monbiot who’s accusing something called A New Alliance, which has just recently been now moved to be, you know, really part of the AU’s comprehensive African Agricultural Development Programme, snappy acronym called CAADP, and he is attacking it not knowing that it’s really an African led initiative. Africans, farmers behind it calling for African investment and most of the investors in it are African private sector but he thinks that because he wants to believe that it’s a rapacious request and nasty capitalists takeover of Africa in part of a new scramble for Africa with the Chinese and you know that might make for a headline grabbing narrative but actually it’s sort of just people saying what does African agriculture need? It needs some investment. Have we helped get that in? Here’s a way. And I think we need to kind of have a bit more of a more mature debate with those who are traditionally the friends of development who also have a sort of kneejerk anti-private sector bias need to come and get over some of that. So that’s a sort of broad point about private sector investment.
But just a very quick thing on the G8. I wish we didn’t live in a world where the G8 really mattered and I wished we didn’t live in a world where celebrity sometimes matter. For the time being, and I wish we didn’t live in a world where aid was necessary, we are in this transitional period. Let’s make the best use of each of these things. Let’s be pragmatic and opportunistic, squeeze as much out as we can of these moments and these opportunities while we try and create something better. To get that better thing we need a lot more events like this and a more global informed citizenry and please have a look at the film at 10 o’clock.
MR: Thank you Jamie for being partly inside and partly outside which is a very good positioning on this panel. And maybe I can reflect for just a moment on the question about what is different. I think it is true that it’s important to try to get issues onto the agenda of the G8. That it can matter greatly as we’ve heard but I actually worry more about the fact that given the challenges that we’re facing in the world today I think we don’t have the leadership that we need. We just don’t have the sense of a real need to move forward. We have an opportunity. I just find it extraordinarily opportune that we have two huge agendas that have to be hopefully concluded by the end of 2015. One is the agenda that was touched on, the post 2015 agenda and we have a good report now of the high level panel on Global Partnerships and I think if that report is not diluted and is taken forward that will make a big difference but it has to be balanced by the other agenda which is the commitment to a new climate agreement by the end of 2015 and I am sorry that Mark was Ed Miliband in saying that this looks to be very difficult because it’s actually vital if we don’t get a climate agreement by the end of 2015 we don’t know what the parameters of our world are to stay a safe world and that’s not just vital for the poorer parts of the world that are already suffering climate shocks but vital in an intergenerational way. We are losing to be able to influence and to be able to stay within the two degrees Celsius whish will still mean that we will have more and more climate shocks but they will be more or less manageable. If we go above that then we’re into unchartered waters that are terrible and our children and our grandchildren and their grandchildren will look back at this period and say what on earth were they talking about. I think the fact that climate change is not top of a G8 agenda is quite extraordinary because nothing else takes on the same sense of how we are to live in this world and the future but that’s my personal view.
I am delighted that this panel has I think performed very well in its task of trying to both advise and consider the challenges facing the G8 and the world generally but I am really delighted that this meeting itself is going to end with the voice of a poet and a very distinguished poet at that that I am quite a fan of, Ben Okri. I am going to invite Ben to come up to the podium. He’s allowed to take the podium as well which I didn’t allow the panellists apart from our distinguished speaker, Mark Moody-Stuart.
Ben Okri as you know is a distinguished poet and novelist from Nigeria. He is a fellow of the Royal Society of Literature and has been awarded an OBE. He has numerous international prizes including the Commonwealth Writer’s Prize for Africa and his novel, The Famished Road, in 1991 won the Booker Prize. He has written a poem especially this evening so I hope that Ben you will inspire us to think further on what the panel has provided us with.
So I invite you to thank the panel for their contribution, in particular Mark Moody-Stuart for his speech and then we’ll hear Ben Okri.
Your frightened me for a minute! I couldn’t see you! I thought you might have disappeared. Left us! But no...
Ben Okri: Thank you all very much. I thought that was a fascinating conversation from the panel and I am going to read a poem called ‘Convergence’ which in some ways coincides with the headline there and for very obvious but not very discernible reasons to everybody it’s dedicated to Michael Aminian because of his work with Zamyn and being an umbrella for these set of events.
The poem is called ‘Convergence’.
~to be released~