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Jan
25

END THIS DAVOS CHARADE!

END THIS DAVOS CHARADE! By CAMERON DUODU

Every year, at the beginning of the new year, some of the cleverest people in the world gather in the Swiss Alpine resort of Davos, ostensibly to exchange ideas about the economic well-being of the world. Note that: the world – not Europe, n9t America, not Asia, not Africa – but the world.

Their gathering is called “The World Economic Forum”. It was founded in January 1971 when a group of European business leaders met under the patronage of the European Commission and some European industrial associations. German-born Klaus Schwab, then Professor of Business Policy at the University of Geneva, chaired the gathering.

Since then, there have been 44 “World Economic Forum” gatherings. I repeat: these gatherings are attended by some of the cleverest people in the world, including economists, businessmen, and statesmen.

I use the term “cleverest” advisedly, for I want to postulate here that being “clever” does not y mean that one is necessarily wise. Clever people tend to get on in life: they make money, or achieve power, or become famous. But none of these attainments necessarily derives from wisdom. Some of the most famous economists in the world have driven the world to the wall once or twice in recent years, with their bad advice to Governments. And some so-called statesmen who strut around the globe making speeches and getting paid for doing so, have killed millions of people who had done no wrong; sometimes on the basis of lies the statesmen and their friends have concocted to justify their murderous desires.

As for famous people, many are merely famous for being famous: some are made of tinsel so wrinkly that it can only retain its shine when retouched by make-up artists and spin doctors.

These clever people have been exchanging “ideas”about the world economy for 44 years. Yet countries like Gabon, the Central African Republic, the Congo Democratic Republic, Cameroon Cote d’Ivoire, Liberia and until recently, Ghana, have been exporting WHOLE LOGS, cut from their forests, to Europe and America, to be used in making furniture and other wood products.

Everyone in West and Central Africa must, at one time or another, have seen timber lorries loaded with some of these logs.

Man, they are huge! I have never personally measured one, but would not think it an exaggeration to hear that some can be as big as six or eight feet in diameter. And about thirty or forty feet long. At least, in the timber lorries, they look as big as that!

Being tall as well as heavy, these tress, when transported along motor road not made to carry such heavy loads, damage the roads considerably. The trees from which the logs are cut kill crops in nearby food farms, and destroy saplings and young, smaller trees, thus denying the forests of the ability to regenerate themselves. Depleted of foliage, many wondrous animals — especially monkeys and birds – lose their habitat. So with every log that is cut, Africa becomes less attractive as the Garden of Nature.

Next, these logs are unloaded into harbours. They take up an enormous amount of space in the water. The final stage on their journey begins when big cranes and chains are used to lift them bodily into large ships to make their journey to Europe and America. Very cleverly-designed factories then turn them into beautiful furniture and wood products, some of which are sold back to the very countries from which the raw wood was exported! It is a most profitable business for European and American compoan9ies,k who own the ships that transport the logs, the factories that process the wood, and the insurance companies that insure the freight.

But what does Africa get from it? Very little/ Think of the wastage of shipping space that the export of huge logs entails. The shipping costs are taken from the final price of the logs. Even in the countries that have banned the export of logs and now insist that only sawn timber or plywood should be exported, the saving in shipping space that results, is minimal.

The clever habitués of Davos know very well that this is a monstrously wasteful way of carrying out international trade. But they are not averse to castigating Africa for contributing only 3 percent of world trade! They add all the value to the raw materials in Europe and America, and add that to their “contribution”to world trade. But Africa, which is the source of the entire value of the product as a whole, is allocated a value that reflects only the price paid for the raw materials. A price, one should add, that us determined by the rich nations that basically filch the raw materials from Africa through this price “mechanism”.

If the wood was coming from Europe and America to be processed in Africa, the clever Davos people would have stopped it years ago. But because it is being taken out of Africa, nobody cares. Why should they? Things have always been taken out of Africa, haven’t they? Things like cocoa. Coffee. Except for the fact that these last two are a little less bulky than timber logs, they too use up a lot of shipping space being sent to Europe and America in jute bags, to be processed. And, of course, the lorries that carry cocoa and coffee also ruin the roads along which they are carted, in much the same way as timber logs.

Ah – one mustn’t forget manganese. Or bauxite. Iron ore. Tin. Phosphates. Zinc. Platinum. Titanium! And so on.

It’s been over one hundred and fifty years since these things began to be extracted out of Africa soil in basically the same form as they are taken out today. And petroleum has joined the ranks of the exported commodities from Africa – pump up the crude oil, put it in tankers, and ship it. Out of Africa. To be refined in Europe or America.

Apart from the slave trade – which cost Africa so many uncountable precious souls – this trade in raw materials from Africa is the most monstrous, obnoxious, wasteful, and inefficient form of trade anyone could invent. Even in the “silent trade” era, people had a choice. In this unconscionable form of trade, all the power resides with the rich countries. By volume of raw materials extracted from her and traded, African ranks as Number One in world trade. Yet when it comes to price received, Africa gets a mere 3 percent of what is traded, If the value added were to be shared equitably, Africa would be at least ten times as rich as she is at the moment. Why should the price of the raw materials continue to be determined by those who buy it? While these same purchasers sell their manufactured goods at prices that they set for everyone? Is there a “tractor exchange” [market] in Salaga? If not, why are the prices of cocoa, coffee and nickel from Africa determined in London or New York? Why must Africa continue to suffer this injustice because she is locked, by poverty, into a situation where it either sells the raw materials at the prices dictated by the purchasers, or gets nothing whatsoever in exchange for them.>>

Vehicle manufacturers such as BMW, Ford (incorporating Mazda), General Motors, Mercedes Benz, Nissan, Renault, Toyota and Volkswagen have production plants in South Africa, while component manufacturers such as Arvin Exhaust, Bloxwitch, Corning, Senior Flexonics have established production bases there. They are carrying out business without any loss of quality, as far as is known., Why can’t the Swiss, Belgian, Dutch, American and British chocolate manufacturers move some of their operations to Ghana and the Ivory Coast? Would l the chocolate “melt” if it was manufactured in “tropical” Africa? Tell that to the marines. Even blood plasma and other highly sensitive health products can be refrigerated well enough these days to make them usable across the world, irrespective of where they originated from.
It reminds me of the answer I got once when I asked the boss of a beer brewery in Ghana why they could not sell draught beer in Ghana. He claimed that it would be difficult to maintain the equipment needed to make draught beer production adequately hygienic in tropical conditions. Yet today, every major brand of beer is sold as draught in Ghana!

But okay – granted there could be a problem with refrigeration, in the case of chocolate. Is there a similar problem with regard to furniture? Or gold and silver jewellery and trinkets? Or alumina powder made from bauxite? Or….?

The clever people at Davos could make a declaration about this issue and recommend to the governments of the industrialised world to offer economic incentives to their companies to move their production units to Africa to add value to Africa’s exports there, prior to exportation. The world would listen, because, of course, it knows how clever these Davosians are. In fact there is a very good precedent for Davos making its voice heard on this terrible wastefulness in the world trade in commodities.

In 1969, a Commission set up by the World Bank under the chairmanship of Lester Pearson, former External Affairs Minister of Canada, reported that the unsustainable debt burdens under which so many developing countries were labouring, were inimical to their prospects for economic growth and that they should be granted “debt relief”” At the time, international debt was generally regarded as “sacrosanct” and it was feared that both the Pearson Commission Report and another by a Commission headed by the former German Chancellor, Willy Brandt, would be laughed out of court. But it was from the seeds sown by those Commissions that the idea of HIPC [debt relief for the so-called ”Highly Indebted Poor Countries”] eventually emerged. The IMF in particular has since then, stopped acting as the “debt collector” for the rich nations, a reputation it earned for itself by breathing fire on any country that defaulted in repaying debts it owed to the countries.

The question is: why haven’t the Davos crowd done as well for the developing countries as the Brandt and Pearson Commissions did?

The answer lies probably in the calibre of the people who go to Davos. Many go there to be seen, or to display their knowledge, or to bask in their status as celebrities. Of course, many of them do speak up in defence of aid to poor African countries, but the fact that if the manufacturers moved their operations to Africa to add value to African exports, Africa would no longer be poor and would need less, if any, aid at all, from the rich countries, doesn’t appear to resonate much with them.

But it is not the clever people from the rich countries who flock to Davos whom I blame for neglecting one of the most challenging issues facing the world today. I reserve my scorn for those African “leaders” – and they are many – who troop to Davos each year to show themselves to their people back home as clever chaps who can wine and dine with the clever chaps of the rich countries.

These African ”leaders” go and enjoy the sweet, clean air of Switzerland, and come back to drive along streets that would be stinking to high heaven in their noses – were it not for the fact that the “leaders” are shielded from the stench on their own streets by cars that are beautifully air-conditioned.

These “leaders” assume that every so-called “investment” that they can “attract” to their countries by talking to their Davos friends, is, of necessity, beneficial to their people. But bot all such investments are good for the people of Africa. Some are just as harmful as the backward, extractive industries I’ve been talking about in this article.

My advice to African legislators, therefore is this: “Please, any time anyone presents you with a budgets expenditure that mentions the annual “World Economic Forum at Davos, veto it! Davos or no Davos, we shall remain in our poverty, unless our leaders become wise rather than merely clever.”

 

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