Eritreans Exploited: UK Corporate Complicity in Human Rights Abuses

Eritreans Exploited: UK Corporate Complicity in Human Rights Abuses

Report for War on Want (January 2017, published online October 2017)

Eritrea’s totalitarian state is extreme and includes a ratified Constitution that hasn’t been implemented; the absence of national elections since independence from Ethiopia in 1991; its Parliament does not meet; the President, Isaisa Afwerki rules without institutional restraint; the government owns all media; and non-governmental organisations are not permitted. Much of Eritrea’s foreign exchange income comes from foreign gold and copper mining company projects in which the Eritrean government holds a 40% stake. The state control of these revenues is enhanced by the complete lack of mining revenue transparency in the country, a fact that has been persistently documented in various UN reports. There are several ways in which Britain is connected to Eritrean mining, thereby being complicit in the practices of this repressive regime. This includes not just the mining companies involved in exploration in the country, but the financial institutions that have invested in UK and other mining companies operating in Eritrea.

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European Development Finance Institutions and Allegations of Land Grabs:  The Need for Further Independent Scrutiny

European Development Finance Institutions and Allegations of Land Grabs: The Need for Further Independent Scrutiny

Report for FERN (September 2017)

This study highlights the role of European Development Finance Institutions (DFIs) in alleged land grabs and questionable forestry projects in Africa. It documents nine such cases involving eight of the European DFIs. It raises the urgent need for more independent research into these projects and the need for much more scrutiny of the investment portfolios of the DFIs, including by the DFIs themselves and by national parliaments.

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Lost Revenues in Low Income Countries

Lost Revenues in Low Income Countries

Report with Dr Bernadette O’Hare (July 2017)

This research estimates how much revenue six low income countries – of which five are in sub Saharan Africa – are losing unnecessarily from various potential revenue streams that could be used to fund public services. Developing countries can lose revenue in a variety of ways. Here we estimate how much is being lost from the following sources:
Tax avoidance by multinational companies; Providing tax incentives (for example, reductions or exemptions from the payment of corporate taxes) which constitute government ‘tax expenditure’; Not collecting taxes from a proportion of business activity in the informal sector; Corruption in the national budget; and Debt interest payments to international creditors. The research finds that revenue losses are large in all countries, which has significant implications for development. The priorities for low income countries are to end corporate tax avoidance, reduce corruption and raise tax collections. These areas are far more important than aid inflows: The six countries under analysis are losing 6.4% – 12.9% of their GDP; In most cases, this amounts to more than the combined national health and education budgets, meaning that expenditure on these areas could more than double; Revenue losses are larger than aid in two of the six countries and over 60% of the amount of aid in a further three.

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Honest Accounts 2017: How the world profits from Africa’s wealth

Honest Accounts 2017: How the world profits from Africa’s wealth

Report for group of NGOs led by Global Justice Now, Jubilee Debt Coalition & Health Poverty Action (May 2017)

Research for this report calculates the movement of financial resources into and out of Africa and some key costs imposed on Africa by the rest of the world. We find that the countries of Africa are collectively net creditors to the rest of the world, to the tune of $41.3 billion in 2015. Thus much more wealth is leaving the world’s most impoverished continent than is entering it. African countries received $161.6 billion in 2015 – mainly in loans, personal remittances and aid in the form of grants. Yet $203 billion was taken from Africa, either directly – mainly through corporations repatriating profits and by illegally moving money out of the continent – or by costs imposed by the rest of the world through climate change.

  • African countries receive around $19 billion in aid in the form of grants but over three times that much ($68 billion) is taken out in capital flight, mainly by multinational companies deliberately misreporting the value of their imports or exports to reduce tax.
  • While Africans receive $31 billion in personal remittances from overseas, multinational companies operating on the continent repatriate a similar amount ($32 billion) in profits to their home countries each year.
  • African governments received $32.8 billion in loans in 2015 but paid $18 billion in debt interest and principal payments, with the overall level of debt rising rapidly.
  • An estimated $29 billion a year is being stolen from Africa in illegal logging, fishing and the trade in wildlife/plants.

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Development Finance Institutions and Responsible Corporate Tax Behaviour

Development Finance Institutions and Responsible Corporate Tax Behaviour

Report for Oxfam IBIS (Denmark) and other NGOs (November 2016)

This report, written with Sara Jespersen of Oxfam IBIS, finds that Development Finance Institutions (DFI) are not doing enough to avoid becoming accomplices in harmful corporate tax practices. It highlights the role DFIs should play in promoting responsible tax practices by companies. DFIs are largely failing to use their influence as investors in companies operating in developing countries to ensure that those companies restrict or eliminate their use of tax havens or to reduce the risk of corporate tax avoidance. While others have taken important steps forward. There is a particular need for DFIs to play this role, given the scale of global tax dodging, the fact that DFIs largely use public money and since DFI investments in developing countries are significantly increasing.

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The New Colonialism: Britain’s Scramble for Africa’s Energy and Mineral Resources

The New Colonialism: Britain’s Scramble for Africa’s Energy and Mineral Resources

Report for War on Want (July 2016)

This report reveals the degree to which British companies now control Africa’s key mineral resources. It reviews the operations of all the companies listed on the London Stock Exchange (LSE) that have mining interests in Africa, focusing on key minerals and metals such as gold, platinum, diamonds, copper, oil, gas and coal. It finds that 101 companies have mining operations in 37 sub-Saharan African countries. These companies, which are mainly British, now control an identified $1.05 trillion worth of resources in Africa in just five commodities — oil, gold, diamonds, coal and platinum. Of the 101 LSE-listed companies, one quarter are incorporated in tax havens. A determination to plunder the natural resources of Africa is taking place, with the active support of the British government; this is contributing significantly to a net drain of resources from Africa, already the world’s poorest continent.

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Still Racing Toward The Bottom? Corporate Tax Incentives in East Africa

Still Racing Toward The Bottom? Corporate Tax Incentives in East Africa

Report for ActionAid and Tax Justice Network Africa (June 2016)

In 2012, ActionAid and Tax Justice Network Africa published a report estimating that East African countries were losing revenues of up to US$2.8 billion a year by providing tax incentives.  The 2012 report received – and continues to receive – widespread attention from the media and governments. This new report assesses what progress has been made since 2012 in reducing these tax incentives, and outlines mixed findings. On the one hand, governments have taken some positive steps to reduce VAT-related incentives, which are increasing tax collections and providing vital extra revenues that could be spent on providing critical services. On the other hand, they are still failing to eliminate all unnecessary tax incentives, including corporate income tax incentives given to corporations. Precise figures are impossible to provide due to a lack of transparency, but the evidence gathered suggests that four East African countries could still be losing around US$1.5 billion and possibly up to US$2 billion a year.

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Supporting Small Businesses in Developing Countries: Which Programmes Work and Why?

Supporting Small Businesses in Developing Countries: Which Programmes Work and Why?

Report for European NGOs (Christian Aid, Church of Sweden, ICCO, Diakonia, Norwegian Church Aid, DanChurchAid) (June 2016)

This study examines how governments and donors can better promote ‘business enabling environments’ so that small and medium-sized enterprises (SMEs) can contribute to inclusive economic development in developing countries. It focuses on ‘what works’ and contains a review of literature on SME support plus three case studies. Despite a substantial literature on business development, remarkably little is known about which SME support programmes work and why. There is significant funding of SME support programmes by multilateral and bilateral actors but much of this is focused on providing financial loans to SMEs and advocating general reforms to the investment climate, which mainly benefit larger enterprises, including multinational companies, rather than SMEs. Other support programmes are often neglected. This study challenges these approaches and suggests alternative support policies.

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The Need for Model Mining Legislation: Case studies on the impact of mining in Angola, DRC, Kenya and Zimbabwe

The Need for Model Mining Legislation: Case studies on the impact of mining in Angola, DRC, Kenya and Zimbabwe

Report for International Alliance on Natural Resources in Africa (IANRA) (May 2016)

Africa is rich in natural resources, with significant deposits of gold, platinum, iron ore, copper, diamonds, and many other minerals and metals. Yet Africa’s people benefit little from these riches and African governments typically capture only a small share of the final value of the vast mineral exports from the continent. Even worse, many communities in mining areas – usually farmers who are already poor – are often left worse off as a result of mining operations. This report presents new research from mining operations in four countries – Zimbabwe, Angola, Kenya and the Democratic Republic of Congo – and highlights ongoing problems and adverse human rights impacts from industrial mining. The report calls for and proposes model mining legislation to ensure that governments transform policies and laws to make African mining support the rights and needs of its people.

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Gated Development: Is the Gates Foundation Always a Force for Good?

Gated Development: Is the Gates Foundation Always a Force for Good?

Report for Global Justice Now (January 2016)

The Bill and Melinda Gates Foundation (BMGF) is the world’s largest charitable organisation, with an asset endowment of $43.5 billion. In global health and agriculture policies, two of its key grant areas, the BMGF has become probably the most influential actor in the world. Bill Gates himself has become probably the single most influential voice in international development. But the BMGF’s increasing global influence is not being subjected to democratic scrutiny. Further, this study shows that the BMGF’s programmes are – overall – detrimental to promoting economic development and global justice. The world is being sold a myth that private philanthropy holds many of the solutions to the world’s problems, when in fact it is pushing the world in many wrong directions.

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