Africa

By International Organization for Migration
GENEVA, Aug 29 2018 (IOM)

“When an acquaintance told me there might be work for me in Austria, I jumped at the opportunity. She told me how good Austria was so I figured I would just get there, find work and settle in. They told me the journey was easy so I decided to give it a go.”

These are the recollections of Sara, one of thousands of Nigerian women who have been fooled by traffickers and sent to Europe, West and Central Africa and the Middle East for domestic labour or sexual exploitation.

For the past three years, the majority of people arriving in Italy by sea were Nigerian. Fifty nine per cent of all victims of trafficking (VoT) assisted by IOM, the UN Migration Agency, in 2016 were Nigerians; the Organization estimates that a staggering 80 per cent of Nigerian women and girls arriving by sea that year were trafficked for sexual exploitation.

In addition to paying large sums of money to their traffickers, Nigerian VoTs often submitted to a voodoo rite which bound them by ‘contract’ to their traffickers. The so-called contract, among other things, prohibits victims from revealing the names of their traffickers and other details that may lead to the identification of exploiters — victims are too scared to break it because they are made to fear that “bad things” will happen to them and their families if they do.

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Security Council meeting on the situation in Yemen. 02 August 2018 United Nations, New York. Credit: UN Photo/Manuel Elias.

By Thalif Deen
UNITED NATIONS, Aug 29 2018 (IPS)

Saudi Arabia, which has been accused of relentlessly bombing civilian targets in strife-torn Yemen and threatening executions of human rights activists, is fast gaining notoriety as a political outcast at the United Nations.

UN Secretary-General Antonio Guterres has not only condemned the continued attacks on civilians but also called for “an impartial, independent and prompt investigation” into some of the recent bombings in Yemen.

The bombings of civilians have also led to speculation whether the Saudis and their coalition partners could be hauled before the International Criminal Court (ICC) for war crimes.

In a report titled “44 Small Graves Intensify Questions About the US role in Yemen”, the New York Times said some members of the US Congress have called on the American military to clarify its role in airstrikes on Yemen “and investigate whether the support for those strikes could expose American military personnel to legal jeopardy, including for war crimes.”

UN Secretary-General Antonio Guterres has not only condemned the continued attacks on civilians but also called for “an impartial, independent and prompt investigation” into some of the recent bombings in Yemen.

Guterres has described Yemen as “the world’s worst humanitarian crisis”, with three in four Yemenis in need of assistance. So far, the UN and its partners have reached out to more than 8 million people with direct assistance this year.

The death toll alone amounts to over 10,000 people, mostly civilians, since 2014.

But any drastic action against the coalition—or even an independent UN investigation–  is most likely to be thwarted by Western powers, including three permanent members of the Security Council, namely the US, UK and France, which are key suppliers to the thriving multi-billion dollar arms market in Saudi Arabia.

According to Amnesty International, the Saudis are also seeking the death penalty for five individuals who face trial before Saudi Arabia’s counter-terror court, including Israa al-Ghomgham, who would be the first woman ever to face the death penalty simply for participating in protests.

With a woman activist being threatened with execution, who is next in line? Children?

Daniel Balson, Advocacy Director at Amnesty International, told IPS “The sad fact is that in Saudi Arabia, children and the mentally disabled are not exempt from execution.”

Abdul Kareem  Al-Hawaj was 16 when he took part in anti-government protests., Abdullah al-Zaher and Dawood al-Marhoon were arrested on 3 March and 22 May 2012, when they were 16 and 17 years old respectively. Ali al-Nimr was 17 when he was arrested in February 2012.

Balson pointed out that these cases have several things in common: All four are members of the minority Shi’a sect. All four claimed that their confessions were extracted under torture. All four are at risk of imminent execution. Unfortunately, Saudi authorities have proven their willingness to incur substantial political cost simply to put people to death.

In January 2016, Saudi authorities executed 47 people in a single day despite widespread international condemnation. Saudi Arabia is certainly no stranger to killing women – authorities executed two in 2017.

Asked about the continued strong military relationship between the Saudis and Western governments, Balson told IPS that U.S. government officials must, along with their Western allies ban the sale of weapons to Saudi Arabia, not just to dis-incentivize executions but because these weapons cause innumerable civilian deaths in Yemen.

“This isn’t conjecture, it’s a documented fact,” he said.

Late last year, Amnesty documented that a US-made bomb killed and maimed children in San’a. Media reports have indicated that a bomb that killed dozens of children this month was made in the U.S.

“The U.S. must communicate to Saudi authorities that the killing of children – whether by warplane or executioner – is abhorrent,” he declared.

Hiba Zayadin of Human Rights Watch (HRW) told IPS the public prosecutor is demanding the death penalty for five of the six activists currently on trial.

“We do not know of any other woman activist that has faced the death penalty before for her rights-related work and believe this could set a dangerous precedent. It goes to show just how determined the Saudi leadership is to crush any and all dissent, all the while claiming to be on a path towards modernization, moderation, and reform,” she said.

Zayadin said now is the time for the international community to speak up about the human rights abuses increasingly taking place in Saudi Arabia today, especially by allies such as the US, UK, and France.

“We believe Saudi authorities would be responsive to calls from allies and international businesses seeking to invest in Saudi Arabia to respect the rule of law and release all unjustly detained dissidents”

If the Saudi leadership is truly committed to reform, she said, it would change course, and as long as it does not, the international community has a responsibility to hold it accountable to its promises.

Samah Hadid, Amnesty International’s Middle East Director of Campaigns, said Saudi Arabia is one of the world’s most prolific executioners and the world cannot continue to ignore the country’s horrific human rights record.

“We call on the international community to put pressure on the Saudi Arabian authorities to end the use of the death penalty, which continues to be employed in violation of international human rights law and standards, often after grossly unfair and politically motivated trials.”

Meanwhile, UN Under-Secretary-General for Humanitarian Affairs Mark Lowcock said that at least 22 Yemeni children and four women were killed in an air strike last Thursday (August 23) as they were fleeing the fighting in Al Durayhimi district in Hudaydah governorate.

“This is the second time in two weeks that an air strike by the Saudi-led Coalition has resulted in dozens of civilian casualties. An additional air strike in Al Durayhimi on Thursday resulted in the death of four children,” he added

Lowcock said he was also “deeply concerned” by the proximity of attacks to humanitarian sites, including health facilities and water and sanitation infrastructure.

The UN and its partners, he pointed out, are doing all they can to reach people with assistance. Access for humanitarian aid workers to reach people in need is critical to respond to the massive humanitarian crisis in Yemen. People need to be able to voluntarily flee the fighting to access humanitarian assistance too.

“The parties to the conflict must respect their obligations under international humanitarian law and those with influence over them must ensure that everything possible is done to protect civilians,” he added.

In a piece titled “US Commander Seeks Clarity in Yemen Attack”, the New York Times said since 2015, the US has provided the Saudi-led air campaign in Yemen with mid-air refueling, intelligence assessments and other military advice.

The US air commander in the Middle East, Lt. Gen Jeffrey Harrigian, has also urged the Saudi-led coalition to be more forthcoming about an airstrike in early August which killed more than 40 children.

Harrigian was quoted as saying “There’s a level of frustration we need to acknowledge. They need to come out and say what occurred there.”

The conflict in Yemen began in 2014 when Houthi rebels, aligned with Iran, seized the capital and sent the government into exile in Saudi Arabia. The fighting intensified beginning 2015.

The post UN Seeks Probe into Saudi Bombing of Civilian Targets appeared first on Inter Press Service.

A proposal from the Union of North African Football Federations for the free transfer of players amongst members draws a mixed reaction.

A photographer spent 29 days on board a Spanish rescue boat off the coast of Libya

Tens of thousands of Namibians were killed in what is called the first genocide of the 20th Century.

Rwanda is combatting banana disease through digital innovation. Credit: Alejandro Arigón/IPS

By Aimable Twahirwa
KIGALI, Aug 29 2018 (IPS)

When Telesphore Ruzigamanzi, a smallholder banana farmer from a remote village in Eastern Rwanda, discovered a peculiar yellowish hue on his crop before it started to dry up, he did not give it the due consideration it deserved.

“I was thinking that it was the unusually dry weather causing damage to my crop,” Ruzigamanzi, who lives in Rwimishinya, a remote village in Kayonza district in Eastern Rwanda, tells IPS.

But in fact, it was a banana wilt infection."The launch of the smart or normal mobile application supports our ongoing efforts to best control the disease in a cost-effective way." -- Julius Adewopo, lead on ICT for the BXW project at IITA

Here, in this East African nation, Banana Xanthomonas Wilt or BXW is detrimental to a crop and has far-reaching consequences not only for farmers but for the food and nutritional security of their families and those dependent on the crop as a source of food.

Banana is an important crop in East and Central Africa, with a number of countries in the region being among the world’s top-10 producers.

According to a household survey of districts in Tanzania, Burundi and Rwanda, banana accounts for about 50 percent of the household diet in a third of Rwanda’s homes, where “annual per capita consumption of banana ranges from 400-600 kg, the highest in the world.”

But the top factor affecting banana production in all three countries, according to the survey, was BXW.

If not handled correctly, it can result in 100 percent loss of crop.

The latest Comprehensive Food Security and Vulnerability Analysis report released by the Rwandan government and its partners in 2015 indicates:

• For 2015, nearly one million metric tons of bananas were produced by the country.
• This was a reduction in productivity.
• In 2013, for the same period evaluated in 2015, 1.2 million metric tons were produced.

Despite this trend across the country, the report found that the south-eastern Plateau Banana Zone still showed high levels of food security.

Complacency and lack of information contribute to spread of the disease

The BXW disease is not new to the country. It was first reported here in 2002. Since then, there have been numerous, rigorous educational campaigns by agricultural authorities and other stakeholders, including non-governmental organisations.

Farmers in Ruzigamanzi’s region have been trained by a team of researchers from the Rwanda Agriculture Board and local agronomists about BXW. But Ruzigamanzi, a father of six, was one of the farmers missed by the educational campaign.

He was unaware of BXW.

Had he known what the disease was, and depending on its state of progress on the plant, Ruzigamanzi would have had to remove the symptomatic plants, cutting them at soil level when first observing symptoms. If left too long he would have had to remove the entire plant from the root.

And it is what he ended up doing two weeks later when a visiting local agronomist came to look at the plant.

By then it was too late to save the tree and Ruzigamanzi had to uproot all the affected mats, including the rhizome and all its attached stems, the parent plant and its suckers.

Ruzigamanzi’s story is not unique. In fact a great number of smallholder farmers in remote rural regions have been ignoring or are unaware of the symptoms of this bacterial banana infection. And it has increased the risk of resurgence of the disease in the region, with several districts in Eastern Rwanda being affected by the disease in recent years.

Using technology to educate rural farmers about the spread of a deadly crop disease

It is one of the reasons why scientists here began looking at alternative ways of educating farmers and monitoring and collecting data about the disease.

In June, a collaboration between the International Institute of Tropical Agriculture (IITA), Bioversity International, the Leibniz Institute of Agricultural Development in Transition Economies and the Rwandan government began to tackle the disease through the use of digital innovation.

The new initiative, launched with a total investment of 1.2 million Euros from development partners, seeks to explore the adoption of smart phones and tablets as scalable tools in generating up-to-date knowledge about BXW.

“These [ICT] innovations could also be useful in determining the severity of the disease thus strengthening control measure, based on past experience and instructions,” Julius Adewopo, lead on ICT for the BXW project at IITA, tells IPS.

According to the 2017 report by Rwanda Utilities Regulatory Authority, Rwanda’s mobile telephone penetration is currently estimated at 75.5 percent in a country of about 12 million people, with a large majority of the rural population currently owning mobile phones.

Central to the project is the citizen science approach, which means farmers and extension officers play leading roles in collecting and submitting data on disease transmission patterns.

Still in the pilot phase, across the country a group of 70 trained farmers, agricultural extension officers and food producers from eight districts use their mobile phones to submit data on the bacterial disease incidence and severity via What’s App or SMS messages. A mobile app was also designed to enhance the user experience.

The mobile app provides a real-time and dynamic way to represent disease information on maps, after analysing the collected information from the field.

“The launch of the smart or normal mobile application supports our ongoing efforts to best control the disease in a cost-effective way,” Adewopo tells IPS.

A real-time reporting system on the disease

While the existing National Banana Research Programme here has long focused on five key areas of interventions, which include the prevention of BXW using recommended crop disease prevention approaches, Adewopo stresses that the unique aspect of the mobile app is that it is easily scalable in a real time system and the information provided on the application can adapt quickly to any changes.

While the new reporting system is intended to provide an early warning system that will allow the Rwandan government to target efforts to prevent the spread of BXW, it also aims to serve as a catalyst to mobilise partnerships, says Mariette McCampbell, a research fellow involved in ICT-enabled innovation and scaling at IITA’s office in Kigali.

“This innovation can also adapt to other crop disease control in the long term and it aims at supporting farmers to transition from subsistence to entrepreneurial farming,” she tells IPS during an exclusive interview.

McCampbell is one of the co-authors on a report about the project, which notes that data is key to developing policies and prevention strategies to aid in combatting the disease.

“We see limitations in the amount of reliable and up-to-date data about disease diffusion patterns, severity of outbreaks, and effect of control measures, as well as socio-economic and socio-cultural data that could feed into farmer decision-making tools and an early warning system.

“Development of informed policies and prevention strategies is also hindered by the absence of large-scale accurate data,” the report notes.

According to IITA, the livelihoods and food security of an estimated 30 million farmers is currently threatened by the wide spread of BXW and fungal disease. Both diseases have decimated banana crops in East and Central Africa.

“Banana farmers in Rwanda should leverage the benefits of this technology using the existing IT infrastructure with the speed of mobile phone penetration in the country,” Adewopo says.

*Additional reporting by Nalisha Adams in Johannesburg

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The post How Rwanda is Saving One of its Most Important Crops—the Banana—With an SMS appeared first on Inter Press Service.

Deputy High Commissioner to UK, Kabiru Bala, calls for international cooperation.

TADEUSZ GALEZA is a research officer in the IMF’s Monetary and Capital Markets Department. JAMES CHAN is a senior information management assistant in the IMF’s Statistics Department.

By Tadeusz Galeza and James Chan
WASHINGTON DC, Aug 29 2018 (IPS)

From strings of shells in the Solomon Islands to large stone disks on the Micronesian isle of Yap or wheels of Parmigiano-Reggiano cheese in Italy, money has taken many forms throughout history.

Today, banknotes are an artistic expression of national sovereignty, with many countries choosing to immortalize famous authors and activists, local wildlife, and iconic national landmarks. In other words, modern paper money represents the essence, history, beauty, and ideals to which each country aspires.

To see this diversity in action, we need look no further than the 189 member countries of the IMF that churn out 136 unique national currencies and form four currency unions.

Standouts include the Malawian kwacha, the smallest banknote in our study at about 87 percent the size of the US dollar bill. At the other end of the spectrum are the Brunei and the Singapore dollars, the largest banknotes in circulation, each with a total area of more than 150 percent of the US dollar bill—calling for a really deep wallet.

Banknotes across the world are rectangular, but most are wider rather than they are tall. Swiss francs, for example, tend to be very slender, while British pounds and Kenyan shillings are more square.

Yet despite the variations in design, the properties that define currency are the same: they are a unit of measure, a store of value, and a medium of exchange. Paper bills, or “fiat” money, also have no intrinsic value; their worth is determined solely through supply and demand, and they are declared legal tender by government decree.

The most important element that separates one national currency from another is its value. Central banks decide what the largest note in circulation should be, and its nominal value is determined by the number of zeros—this indicates the purchasing power of the note within the country.

Currently, the largest bills changing hands range from 20 Bahrain dinars to 500,000 Vietnamese dong. Historically, because of hyperinflation, many countries printed banknotes with a cartoonish number of zeros: Yugoslavia issued a 500 billion dinar bill in 1991, and Zimbabwe a 100 trillion dollar bill in 2009.

 

 

Today, a hundred units of currency (for example, 100 US dollars) is most commonly the highest available banknote in each country. But the real value (proxied here by its worth in US dollars) is where the rubber hits the road.

On average, the largest banknote in circulation across countries is equivalent to 33 US dollars, but the difference in real value from country to country could not be more stark. It takes three 100 South Sudanese pound notes (their largest in circulation) to purchase a medium coffee at Starbucks. At the opposite end, it takes only two of Brunei’s largest bills—10,000 dollar notes—to buy a 2018 Toyota Yaris sedan.

Cash, nevertheless, may not be king forever.

With digital currencies and online transactions gaining steam worldwide, the future of paper money may be in jeopardy. What was once valued precisely because of its physicality is giving way to a new global economy where more and more transactions—big and small—are processed electronically.

Perhaps one day countries will design and issue banknotes of the virtual kind, embedded with even richer features to celebrate all they hold dear. Until then, however, paper banknotes will retain an undeniable appeal.

The link to the original article follows:  http://www.imf.org/external/pubs/ft/fandd/2018/06/value-of-paper-money-around-the-world/currency.htm?utm_medium=email&utm_source=govdelivery

PHOTO CREDITS: ISTOCK.COM/BENEDEK, MICHAEL BURRELL, YEVGENROMANENKO, ALAMY.COM/CHRISTOPH RUEEGG, CHRONICLE

Opinions expressed in the article are those of the authors; they do not necessarily reflect IMF policy.

The post Striking the Right Note: a History of Paper Money appeared first on Inter Press Service.

Excerpt:

TADEUSZ GALEZA is a research officer in the IMF’s Monetary and Capital Markets Department. JAMES CHAN is a senior information management assistant in the IMF’s Statistics Department.

The post Striking the Right Note: a History of Paper Money appeared first on Inter Press Service.

By WAM
ASTANA, Aug 29 2018 (WAM)

Dr. Mohammed Ahmed bin Sultan Al Jaber, UAE Ambassador to Kazakhstan, today attended the opening ceremony of the International Conference of the Comprehensive Nuclear-Test-Ban Treaty Organisation, CTBTO, titled “Remembering the Past, Looking to the Future”.

The conference, held on 29th August- 2nd September, coincides with the International Day against Nuclear Tests – observed on 29th August – and was introduced by the UN General Assembly in 2009 at the initiative of the President of Kazakhstan Nursultan Nazarbayev.

The five-day conference was opened in the presence of Kairat Abdrakhmanov, Kazakhstan’s Minister of Foreign Affairs; Kanat Bozumbayev, Kazakhstan’s Minister of Energy, senior officials of the Kazakh Government, and scientists in nuclear disarmament, as well as heads of diplomatic missions and international organisations accredited to Astana.

The participants will discuss the role of nuclear disarmament and non-proliferation towards building a lasting global peace, including by enhancing the status of the Treaty.

On the sidelines of the conference, Ambassador Al Jaber met with Kazakhstan’s Foreign Minister and Energy Minister.

 

WAM/Rola Alghoul/Hatem Mohamed

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Ivory Coast striker Seydou Doumbia signs a three-year deal with Girona, making the Spanish side his seventh club in the last decade.

South Africa coach Stuart Baxter warns his players and fans about underestimating Libya in their Africa Cup of Nations qualifier.

Theresa May also plans to discuss security and people trafficking with the Nigerian president.

Agnes Pareiyo is a Kenyan Maasai woman on a mission to educate people on the harm done by female genital mutilation.

A 17-year-old woman said she was held and repeatedly raped and tortured over two months.

The Christian girl, 15, has reportedly refused to convert to Islam, so Boko Haram refuse to free her.

Denmark-based striker Mustapha Bundu will have to wait before he becomes the first graduate of Craig Bellamy's academy to play for Sierra Leone.

South Africa midfielder Siphiwe Tshabalala is set for a move to Turkish club BB Erzurumspor after 12 years at Kaizer Chiefs.

By International Organization for Migration
GENEVA, Aug 28 2018 (IOM)

IOM, the UN Migration Agency, reports that 67,122 migrants and refugees entered Europe by sea in 2018 through 26 August, with 27,994 to Spain, the leading destination this year. This compares with 123,205 (172,362 for the entire year) arrivals across the region through the same period last year, and 272,612 at this point in 2016.

Spain, with 42 per cent of all arrivals through the year, continues to receive seaborne migrants in August at a volume more than twice that of Greece and more than four times that of Italy. Italy’s arrivals through late August are the lowest recorded at this point of a normally busy summer sailing season in almost five years (see chart below).

 

IOM Rome on Monday reported that late Saturday, after a prolonged delay, all the migrants on the Italian Coast Guard ship Diciotti were allowed to disembark into Italy.

The 190 migrants (mostly Eritreans and Somalis) were rescued by the Diciotti on 15 August. However, the ship was permitted only the evacuation of 13 migrants (for medical reasons) before being ordered to wait at anchor off the coast of Lampedusa. That lasted five days, before the Diciotti’s crew received authorization to move their vessel to the port of Catania.

The remaining migrants then remained on board five additional days in the port of Catania, as Italian authorities were unable to authorize their landing – because the Italian authorities insisted they would not authorize disembarkation until there was an agreement to relocate them to other EU Member States.

Following several humanitarian appeals (both IOM and UNHCR asked the Italian Government to allow these migrants to disembark) only the minors were permitted to leave the ship by Thursday evening.

While an agreement was not reached at EU level, all the migrants ultimately were allowed to disembark on Saturday night, when the Italian Minister of Interior announced that 20 migrants will be relocated to Albania and 20 to Ireland, while 100 would be welcomed by the Vatican – within Italian territory, however, on property administered by the Holy See.

According to testimonies gathered by IOM staff from the minors who disembarked Thursday evening, the migrants – all malnourished and exhausted – reported having been arbitrarily detained for up to two years in Libya, where many of them had been beaten and tortured by smugglers and traffickers seeking ransom money from their families in their countries of origin. Moreover, Italian doctors who attended the women on the Diciotti reported that many of them had been raped while in Libya.

“Migrants arriving from Libya are often victims of violence, abuses and torture; their vulnerabilities should be timely and properly identified and addressed,” added Federico Soda, Director of IOM’s Coordinating Office for the Mediterranean and Chief of Mission for Italy and Malta.

IOM’s Missing Migrants Project (MMP) has documented the deaths of 1,549 people on the Mediterranean in 2018. Most recently, in the Western Mediterranean, the Spanish Guardia Civil recovered the body of a young Sub-Saharan man near Alboran Island on 24 August. A merchant vessel had spotted his body, along with the body of another migrant, and had alerted Spanish authorities. A search operation is still underway to find the remains of the other migrant, which have not been located as of 27 August.

On 24 and 25 August, the remains of two individuals were recovered off the coast of Djerba in Tunisia. They are believed to have died in a shipwreck that took place on 20 August off the coast of Djerba. The current death toll from that shipwreck stands at eight dead and one missing. One survivor was rescued by the Tunisian National Guard.

IOM Spain’s Ana Dodevska reported that total arrivals at sea in 2018 have reached 27,994 men, women and children who have been rescued in Western Mediterranean waters through 26 August (see chart below).

She further reported that starting Sunday (26 August) a new, temporary, Motril-based reception centre for foreigners has become operational. This centre can accommodate a total of 250 migrants. A similar reception centre – the first of its type – also became operational at the Port of Crinavis in San Roque on 2 August. Currently, the centre in San Roque remains the largest centre of this type in Spain with a total capacity of 450 persons.

Given the increase in arrivals, the Spanish authorities decided to activate these types of centres in order to speed up the identification process of the newly arrived migrants. The maximum duration of stay in these centres is limited to 72 hours, after which the migrants are transferred to various Humanitarian Assistance Reception Centres. Explained Dodevska: “The newly opened centers are only for the first identification process upon arrival. The Humanitarian ones are financed by the Ministry of Labour, Migrations and Social Security and all of them are managed by NGOs.”

Read more

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By WAM
STOCKHOLM, Aug 28 2018 (WAM)

Water scarcity in the Middle East and North Africa (MENA) region can either be a destabilizing factor or a motive that binds communities together, according to a new joint report from the United Nation’s Food and Agriculture Organization (FAO) and the World Bank, with the difference determined by the policies adopted to cope with the growing challenge.

The report, Water Management in Fragile Systems: Building Resilience to Shocks and Protracted Crises in The Middle East and North Africa warns that instability combined with poor water management can become a vicious cycle that further exacerbates social tensions, while emphasizing that the actions needed to break the cycle can also be essential elements for recovery and consolidating stability.

More than 60% of the region’s population is concentrated in places affected by high or very high surface water stress, compared to a global average of about 35%. If left unchecked, climate-related water scarcity is expected to cause economic losses estimated at 6 to 14% of Gross Domestic Product by 2050, the highest in the world.

Launched today during a special session focused on MENA at the World Water Week conference in Stockholm, Sweden, calls for a shift away from current policies focused on increasing supplies toward long-term management of water resources. Ineffective policies have left both the region’s people and communities exposed to the impacts of water scarcity, growing ever more severe as a result of rising demand and climate change. More than 60% of the region’s population is concentrated in places affected by high or very high surface water stress, compared to a global average of about 35%. If left unchecked, climate-related water scarcity is expected to cause economic losses estimated at 6 to 14% of Gross Domestic Product by 2050, the highest in the world.

“Economic losses mean rising unemployment, compounded by the impact of water scarcity on traditional livelihoods such as agriculture,” said Pasquale Steduto, FAO Regional Programme Coordinator for the Near East and North Africa and co-lead author of the report, “the result can be food insecurity and people forced to migrate, along with growing frustrations with governments unable to guarantee basic services, which risks becoming another driver of the region’s widespread instability. The good news is that actions can be taken to prevent water scarcity and instability from becoming a vicious cycle, by focusing on sustainable, efficient and equitable water resources management and service delivery.”

A balanced approach will be needed that addresses the short-term impacts of water scarcity while investing in longer-term solutions, including the adoption of new technologies, as the basis for sustainable growth. An FAO project in Iraq is supporting resilience to drought by providing cash-for-work to internally displaced people and refugees. A World Bank financed water-treatment plant in Gaza aims to reverse years of neglect due to instability with the reliable supply of safe drinking water and the gradual replenishment of the aquifer with treated water. In Egypt, 10 percent of agricultural water is recycled drainage water, while Morocco plans to install more than 100,000 solar pumps for irrigation by 2020.

“Water scarcity always has both a local dimension, as it directly impacts communities, and a regional one, as water resources cross borders,” said Anders Jagerskog, World Bank Senior Water Resources Management Specialist and report co-lead author. “Addressing water scarcity is an opportunity to empower local communities to develop their own local consensus on strategies for addressing the challenge. At the same time, it is a motivation for strengthening regional cooperation in the face of a common problem.”

More than half of all surface water in the region are transboundary, and all the countries share at least one aquifer. The long history of shared water management in the region demonstrates how water offers an opportunity to bring people together to solve complex challenges related to the allocation and delivery of water. Consultations at the local level coupled with the restoration of water services, can help rebuild the bond of trust between citizens and the government. Regional partnerships to manage shared resources is a step toward greater regional integration. The report emphasizes that while the policies are critical for effective water management, they are also vital contributions to long-term stability.

 

WAM/Tariq alfaham

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Yilmaz Akyüz is former Director, UNCTAD, and former Chief Economist, South Centre, Geneva

By Yilmaz Akyüz
GENEVA, Aug 28 2018 (IPS)

The meltdown of the Turkish currency over a matter of a few days in August 2018 has elicited various reactions and interpretations both at home and abroad, and created widespread concern that it could mark the beginning of a series of crisis in emerging economies exposed to a reassessment of risks by international investors and lenders as well as a rapid normalization of monetary policy in the United States.

Some commentators have attributed the crisis to the sanctions imposed by the Trump administration discontent with the foreign policies pursued by Turkey on many fronts.  The Erdogan government has been too happy to put the blame on “the economic warfare launched by the United States”, rather than years of misguided policies that rendered the economy highly susceptible to political and economic shocks.  It has even enjoyed support from some western governments weary of Trump’s errant foreign policy. Others drew parallels with previous crises in emerging economies, notably the East Asian crisis, placing particular emphasis on the role of external debt in dollars, notably excessive short-term borrowing.

Yilmaz Akyüz

In reality Trump sanctions only acted as a trigger as the economy was sitting on a time bomb.  The currency was already under pressure before the sanctions came into force because of growing awareness of the fragility of the economy.  The lira had lost a quarter of its value against the dollar between January and July 2018.

On the other hand, there are some crucial differences between the underlying vulnerabilities culminating in Turkish and East Asian crises, particularly with respect to the size of current account deficits, the foreign presence in domestic securities, credit and deposit markets, the extent of dollarization and the scope for capital flight by residents.  In all these respects Turkey has been much more vulnerable to currency turmoil than were the East Asian economies in the 1990s.

In a book published by OUP last year, I identified Turkey as the most fragile emerging economy highly vulnerable to external financial crisis after examining, as of end 2013, various sources of potential pressure on its currency and drain on its international reserves in the event of a sharp turnaround in market sentiments and a sudden stop of capital inflows.  It was clear that in such an event, Turkey could not at the same time finance its current account deficit, remain current on its external debt payments in dollars and allow a rapid exit of non-resident portfolio investors from domestic financial markets even in the absence of capital flight by residents.  It was also remarked that capital flight for residents often constituted greater pressure on the currency and international reserves. This was a serious potential threat in Turkey as residents could freely buy and sell dollars, hold forex deposits in local banks and transfer their assets abroad.

The economy has become even more fragile since then.  The current account deficit has remained unchecked as the government sought consumption/construction-led, debt-driven economic expansion which has added very little to productive capacity and export potential.  Persistent deficits have been financed by massive sale of national assets and external borrowing, leading to a rapid deterioration of the net international investment position, from around ‒42 per cent of GDP in 2013 to over ‒54 per cent by 2018.

External debt as a proportion of GDP rose from 41 per cent in 2013 to 63 per cent on the eve of the crisis.  A large proportion of this debt, over 25 per cent of GDP, had a remaining maturity of up to one year. The sum total of short-term debt and current account deficits was more than twice as much as international reserves.  Furthermore, the presence of non-resident portfolio investors in domestic markets became more visible and capital flight by residents remained an even more serious source of pressure on the currency and reserves for political as well as economic reasons.

Turkey, as most other major emerging economies, is highly averse to recourse to the IMF for international liquidity because of its appalling record in interventions in past crises in emerging economies

Sovereign external debt now accounts for some 20 per cent of the total while the rest is equally divided between banks and non-financial corporations.  The latter have been allowed to borrow in dollars both at home and abroad irrespective of their potential to earn foreign currency to service it. Such debt poses greater threat to stability than sovereign debt since, at times of currency turmoil, private debtors attempt to close their open positions by purchasing foreign currency in order to avoid further losses and this in turn accelerates the decline of the currency.

Turkey has thus practised an extreme form of laissez faire in financial affairs and, in effect, become a highly dollarized, dual-currency economy.  Not only liabilities and assets are increasingly denominated in the dollar, but also an important part of property prices, incomes and rents, as well as government contracts in public private partnership projects are fixed in dollars.

In such an economy, a significant loss of confidence can exert intense pressure on the currency irrespective of volume and terms of external debt.  With Trump sanctions the lira started a free fall primarily because of flight of residents, both asset holders and dollar debtors, from the currency, sudden stop of capital inflows and the exit of non-residents from local markets.  Besides, the decline was accentuated by speculators, shorting liras in swap operations in anticipation of a significant drop in the currency. The short-term dollar debt to international creditors has not yet come into play. Still, the outcome has been steep falls in the lira and stocks and a hike in yields on local-currency sovereign debt.  The cost of insuring Turkish debt (Credit Default Swaps – CDS) has shot up, reaching 500 basis points compared to 240bp for Brazil and 315bp for Greece.

In view of stern opposition of the President, the Central Bank avoided a hike in lending rates, but closed its low-cost repo funding, forcing banks to borrow at its more expensive overnight rate ‒ something aptly described as “stealth” tactic to hike borrowing costs.  Further, it has limited currency swap transactions to curb speculation against the lira.

Turkey, as most other major emerging economies, is highly averse to recourse to the IMF for international liquidity because of its appalling record in interventions in past crises in emerging economies.  As anticipated in an earlier IPS article, it thus sought help from its close allies, securing a pledge of $15 billion from Qatar.

These measures, together with 9-days respite from Muslim Eid Al-Adha brought some calm to currency and financial markets.  But all is not over yet. The underlying structural fragilities remain unabated and cannot be remedied overnight because they involve severe balance sheet distortions and imbalances.

Even if the lira remains relatively stable from now on, the sharp decline it has so far undergone ‒ by some 40 per cent since the beginning of the year ‒ could impinge heavily on unhedged debtors, resulting in serious debt servicing difficulties and even defaults.  As Bloomberg reports the CDS curve is inverted ‒ as it was in Greece in the worst days of its debt crisis ‒ not only for sovereign debt but also for the debt of some of the biggest commercial banks; that is, it costs more to insure one-year default than to buy five-year protection.  This suggests that markets are expecting imminent debt-servicing difficulties.

As loans and bonds mature in coming months, the country may find it very difficult to persuade creditors to roll over debt or to replace maturing bonds with new ones even at significantly higher rates.  An important part of syndicated bank loans is due for renewal in September 2018. The dispute with the US involving the state-owned Halkbank over Iranian sanctions can make the renewal process complicated (I thank Hakan Ozyildiz for this point).  Thus, with short-term debt coming into play, the crisis could cease to be a currency crisis but a full-blown debt and banking crisis, leading to a deep and protracted economic contraction.

The crisis could also generate severe contagion to the rest of the world.  Defaults by Turkish debtors could squeeze some European creditors, mainly a number of banks in Spain, Italy and France who have relatively high exposure directly or through subsidiaries in Turkey.  This would also have a serious impact on global risk appetite. A sharp reassessment of risks, together with monetary tightening in the US and Trump follies in trade, could wreak havoc in several emerging economies who have gone out of bounds in the years of easy money since 2008.

When so many policy mistakes are committed and so much debt is accumulated and assets are lost, there is no easy way out.  But, it is always possible to ease the pain. It is not clear if the Turkish government will be able to move from populist rhetoric to effective economic measures to address the root causes of the crisis.  On the other hand, should the crisis spread globally, the international community is unlikely to be able to manage it in an orderly and equitable way, rather than muddling through it as in the past, because it is no more prepared to respond to such crises than it had been in previous episodes.

The post Crisis alla Turca appeared first on Inter Press Service.

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Yilmaz Akyüz is former Director, UNCTAD, and former Chief Economist, South Centre, Geneva

The post Crisis alla Turca appeared first on Inter Press Service.