by Alex Evans | Jan 11, 2011 | Cooperation and coherence, Influence and networks, UK
The House of Commons Foreign Affairs Select Committee is doing an inquiry at the moment into “The Role of the Foreign & Commonwealth Office in UK Government” – details and terms of reference can be found here. You can also read what Lords Hennessy and Jay had to tell the Committee here, and what former Foreign Secretaries David Miliband and Malcolm Rifkind had to say in their session here.
Tomorrow David and I are up in front of the Committee, talking about our Chatham House report Organising for Influence (pdf) – it’s at 3pm in the Grimond Room of Portcullis House if you’re in Westminster. We’ll post a link to the transcript of our evidence once it’s up.
by David Steven | Jan 10, 2011 | Influence and networks
I am hugely reassured to hear that, in this era of global crisis, British diplomats are focusing on the really important issues:
An agreement has been signed to bring two giant pandas to Edinburgh Zoo, the first to live in the UK for 17 years.
The deal was signed at Lancaster House in London by the Royal Zoological Society of Scotland and the Chinese Wildlife Conservation Association.
It was witnessed by Deputy Prime Minister Nick Clegg and Vice Premier of China Li Keqiang.
Tian Tian and Yangguang, a breeding pair born in 2003, will be under the custodianship of the zoo society.
The project represents the culmination of five years of political and diplomatic negotiation at the highest level and it is anticipated the giant pandas will arrive in their new home as soon as a date is agreed.
The Chinese government is said to charge around $2m a year to rent a pair of pandas. Apparently though, “the Giant Panda Project will be funded through sponsorship, offering unparalleled opportunities in terms of international corporate, commercial and diplomatic relationships between China and the UK.”
Happy days.
by David Steven | Jan 10, 2011 | Climate and resource scarcity, South Asia
On the face of it Pakistan may have bigger things to worry about, but recent weeks have seen it fall out with India over the humble onion:
The pungent vegetable is now at the centre of a mini diplomatic storm that has further soured relations between both countries over the past few days. The Pakistani commerce ministry banned the export of onions across the border by road and rail due to high prices and shortages at home.
Food inflation is running high across South Asia and onion prices are soaring in both Pakistan and India, as the two have had bad harvests of the crop. Reported hoarding and speculation in India have added to the crisis.
Onions are a touchy subject in India and past price hikes have brought down governments. In retaliation, farmers in Indian Punjab have stopped exporting vegetables to Pakistan.
A sideshow, surely, to the really big issues like Kashmir or religious extremism? Maybe not. You can’t spend anytime in Pakistan without noticing the powerful role played by resource scarcity in the country’s politics.
It all goes back to the global food and energy price spike of 2008. According to the IMF, growth had been robust up until that point and government finances were in reasonably good shape.
Conditions deteriorated in mid-2008 with the sharp increase in international food and fuel prices and worsening of the domestic security situation. The fiscal deficit widened, due in large part to rising energy subsidies, financed by credit from the central bank.
As a result, the rupee depreciated and foreign currency reserves fell sharply. Inflation reached 25 percent in mid-2008 [mostly food], causing harm to vulnerable social groups.
The country has never really made it back onto an even keel. The global economic crisis gave Pakistan a little relief, pushing commodity prices sharply lower, but the public finances never recovered.
And as food and energy prices have risen again, Pakistan has been hit by a succession of mini-commodity shocks (the sugar crisis of 2009 and 2010, the flour crisis of 2010). Some estimates suggest that higher food prices have led to a precipitous decline in caloric intake (though robust data is hard to track down).
Gas and electricity are in critically short supply, leading to frequent load shedding, for consumers, business, and industry in winter. Around the major cities, one sees trees being stripped bare by people desperate for heat for their houses and businesses:
Shopkeepers operating in the streets and mohallahs are using pieces of wooden and cardboard crates and other packing material to brace the chill in the air.
Many Lahorites are having ‘bonfires’ even during day time. An empty tin of cooking oil is usually converted into a hearth by making holes in it. Old newspapers, textbooks and copies besides parts of broken furniture are used to make fire as it is hard for many to afford Rs1,200 per 40 kilo fire wood or Rs40-50 per kilo coal.
There are no easy solutions. Pakistan has also been under intense pressure from the IMF and the United States to reduce fuel subsidies, in order to cut its deficit and meet the conditions of its IMF loan.
But its attempts to comply simply fuelled political instability. The PPP-led government came close to falling when it attempted to push up the cost of petrol at the end of 2010. Backing down was the price of getting its junior partner, MQM, back into the coalition late last week.
The result, though, has been unwelcome speculation that Pakistan may on the road to default – a worry that is likely to intensify as oil prices head ever higher.
Inflation is now up to 16%, with food prices expected to rise 20% in December 2010 (year-on-year). In November last year, onions jumped in price by 67% in just one month alone.
As in 2008, many of the drivers of the crisis are regional and global. While the attention of the world is fixated on Pakistan’s struggle with religious extremism. In the background, the struggle for resources seems to be doing as much to push this country towards ruin.
by Alex Evans | Jan 10, 2011 | UK
The BBC’s story today about an undercover policeman who infiltrated environmental groups for nearly a decade, before switching sides and offering to give evidence for the defence in their prosecution case, is a gem. I particularly enjoyed this aspect:
He lived a double life: as Mark Kennedy of the Metropolitan Police and as Mark Stone, green activist, based in Nottingham.
He would disappear for extended periods, saying he had to visit his “brother” in the United States.
So, er, he helped to organise protests against coal-fired power stations, but none of his fellow activists thought there was anything untoward in his commuting from Britain to the US?
by Andy Sumner | Jan 6, 2011 | Economics and development, South Asia, UK
The UK parliament’s development committee begins its inquiry into UK aid to India next week with a question mark over the future of UK aid to a country where there are 450 million poor people – a third of the world’s poor -living below US$1.25/day. In fact, 8 Indian states alone have more poor people than the 26 poorest African countries combined.
This is emotional territory – on both the UK and India side – during Cameron’s autumn 2010 visit sparks flew with the Indian finance minister calling UK aid ($700m) ‘peanuts’ in an angry response to the suggestion that the UK might end aid to India.
An Indian official’s memo leaked to the BBC largely concurred with the ‘who do you guys think you are?’ line.
It might be that the Indians got mad because DFID signaled it wanted to direct more aid to individual states rather than the central government. More recently the idea of an emerging power, that is a foreign aid donor itself, accepting aid has raised substantial debate within India itself.
DFID’s Secretary of State, Andrew Mitchell is said to be open to discussion either way but was persuaded so far by Cameron that the UK can’t be seen to be cutting aid to a country that British people think is a poor country even if it isn’t.
Donors have a somewhat tangled logic on middle income countries (MICs):
1. The mission of donors is poverty reduction
2. 72% of the poor live in MICs
3. Donors are withdrawing from MICs, where the poor live
4. Oops…
Currently, India receives about $2bn of aid/year from donors and the UK makes up about a third of this. Since 1998, India has received more UK overseas aid than any other country. Further DFID works in 27 MICs and spends about a third of bilateral programming in MICs in 2008/9. In contrast, almost a half of EU ODA is to MICS.
The paradox is India, like many other countries was ‘graduated’ out of ‘poor country’ status by the World Bank in 2009 to middle income status (more than $1000 per person per year) but is still home to a third of the world’s poor or 450 million people. India is still IDA (World Bank) eligible but will likely graduate three years from now.
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