From Poverty to Power Green, Oxfam 2008 - weman

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3 POVERTY AND WEALTH PRIVATE SECTOR, PUBLIC INTERESTThese differences may be becoming less significant with time – forexample, as domestic businesses move more quickly into liberalisedglobal financial markets, or as TNCs recognise the need to ‘becomeindigenous’in order to understand their customers better and succeedwith bottom-of-the-pyramid approaches. 151 But governments stillhave to weigh up the costs and benefits to determine what combinationis most likely to lead to overall development.Developing countries face five main challenges in harnessingforeign investment for development:Linkages: Foreign companies tend to be less willing to buy inputsfrom local suppliers, often preferring to source from their own countryor parent company (see the Zambia example on page 177). Especiallyin the case of export industries, this can mean that TNCs’ operationscome to resemble enclave economies, providing few benefits tothe rest of the economy beyond a limited number of jobs. Mexicanproducedinputs to the maquila belt of ‘last touch’ assembly factorieson the US border accounted for just 3.1 per cent of total value in2000. 152 Without such linkages, high headline figures for exports arelargely cancelled out by the high imports required: the difference, orvalue added, is much less impressive. The absence of linkages alsoextends to revenue: many transnational corporations have provedadept at avoiding taxes through tricks such as transfer pricing (see Part 5).Technology transfer: Joint ventures with foreign companies havehelped successful developing countries such as Taiwan to absorb andadapt technologies that would otherwise have taken them years todevelop. In general,‘spillovers’ of technology occur more often wherecompanies have some degree of local ownership. 153 These days, however,proliferating trade and investment agreements restrict the ability ofgovernments to insist on technology transfer, while stronger internationalpatenting rules protect companies that insist on keepingcutting-edge technology to themselves. In light of global warming,encouraging such transfers will be particularly important in helpingcountries to move rapidly to a low-carbon growth model.Profit remittances: Governments need to maximise investment,while corporations expect to be able to use their profits as they see fit.That may involve reinvestment locally, but often it means sendingprofits back to the home country. Profit remittances from developing175
FROM POVERTY TO POWERcountries rocketed tenfold from $17bn in 1990 to $169bn in 2005,twice the global flow of aid. This represents a serious capital outflow,cutting into the potential developmental impact of FDI. 154Employment: FDI tends to use capital-intensive technology thatgenerates few jobs. According to the UN, some 70,000 TNCs generate53 million jobs around the world, but this represents just 2 per cent ofthe global labour force. 155Race to the bottom: As poorer countries such as China and Viet Namhave climbed aboard the globalisation bandwagon, the pressure ongovernments to introduce incentives to attract investment has intensifiedinto a ‘race to the bottom’. Governments desperate for foreigncapital and technology are going to enormous lengths to outbid theirrivals. This includes privatisation of state-owned companies, perks suchas tax exemptions for incoming investors, the easing of restrictions onprofit remittances, and the establishment of special export-processingzones where trade unions are banned. Such competition deprivesgovernments of tax income and risks undermining labour rights inthose countries that have already made some progress.Global agreements on a universal floor for corporate taxation, andgreater efforts to ensure global recognition of the core labourstandards of the ILO, could help to reverse the race to the bottom. Inthe end, however, the main responsibility lies with individual states.Governments in China, Taiwan, Malaysia, Singapore, and Botswanahave proved highly effective in getting a good deal out of foreigninvestment. In the initial stages of its take-off, Taiwan insisted onforeign investors undertaking joint ventures with local businesses inorder to accelerate the rate of technology transfer; Botswana negotiatedfavourable deals for its diamonds with South Africa’s de Beers; whileall the East Asian countries improved their bargaining power withinvestors by spending on infrastructure and on health care and educationin order to guarantee a skilled, healthy workforce.As major actors whose activities affect the lives of poor people,transnational corporations have a duty to behave responsibly. What isknown as corporate social responsibility (CSR) has many facets, fromallocating a small portion of the profits to charity, to producingproducts that are of particular benefit to poor people (such as BPdeveloping a fuel-efficient stove), 156 to taking into account the social176
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OXFAM INTERNATIONALOxfam Internatio
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First published by Oxfam Internatio
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PART 4 RISK AND VULNERABILITY 197Li
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LIST OF ACRONYMSAIDSARTARVASEANAUCA
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ACKNOWLEDGEMENTSThe word ‘editor
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FOREWORDGeorge Bernard Shaw argued
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FOREWORDThis book, which I hope wil
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PART ONE
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1 INTRODUCTION THE UNEQUAL WORLDEnd
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1 INTRODUCTION THE UNEQUAL WORLDExt
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1 INTRODUCTION THE UNEQUAL WORLDPOV
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1 INTRODUCTION THE UNEQUAL WORLDSuc
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1 INTRODUCTION THE UNEQUAL WORLDACT
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1 INTRODUCTION THE UNEQUAL WORLDpeo
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1 INTRODUCTION THE UNEQUAL WORLDcom
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PART TWOThe political roots of deve
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2 POWER AND POLITICS THE POLITICAL
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2 POWER AND POLITICS THE POLITICAL
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I HAVE RIGHTS, THEREFORE I AMThe hi
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2 POWER AND POLITICS I HAVE RIGHTS,
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FROM POVERTY TO POWERThe attitudes
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FROM POVERTY TO POWERJain: ‘A man
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FROM POVERTY TO POWERI READ, THEREF
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FROM POVERTY TO POWEREven where pub
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FROM POVERTY TO POWERplayed a pivot
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FROM POVERTY TO POWERDespite some p
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FROM POVERTY TO POWERof sub-Saharan
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FROM POVERTY TO POWERIn water servi
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FROM POVERTY TO POWERI SURF, THEREF
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FROM POVERTY TO POWERDespite the hy
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FROM POVERTY TO POWERresearch effor
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FROM POVERTY TO POWERWE ORGANISE, T
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FROM POVERTY TO POWERreinforce disc
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FROM POVERTY TO POWERThe bedrock of
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FROM POVERTY TO POWERwith imperviou
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FROM POVERTY TO POWERgovernments an
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FROM POVERTY TO POWERCASE STUDYand
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FROM POVERTY TO POWERI OWN, THEREFO
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FROM POVERTY TO POWER‘breathe lif
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FROM POVERTY TO POWERLAND REFORM‘
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FROM POVERTY TO POWERled to the cou
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FROM POVERTY TO POWERthese things.
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FROM POVERTY TO POWERwhile Benin an
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FROM POVERTY TO POWERWhere flawed d
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FROM POVERTY TO POWERstarted to att
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FROM POVERTY TO POWERI STEAL, THERE
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FROM POVERTY TO POWERTHE CURSE OF W
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FROM POVERTY TO POWERI RULE, THEREF
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FROM POVERTY TO POWERthe turn of th
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FROM POVERTY TO POWERBOX 2.2ARE EFF
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FROM POVERTY TO POWER‘embedded au
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FROM POVERTY TO POWERIn the face of
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FROM POVERTY TO POWERcost incurred
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FROM POVERTY TO POWERIn the Horn of
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FROM POVERTY TO POWERFROM POVERTY T
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FROM POVERTY TO POWER106
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FROM POVERTY TO POWERAN ECONOMICS F
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FROM POVERTY TO POWERpicture it off
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FROM POVERTY TO POWERthe work of wo
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FROM POVERTY TO POWERWhile the envi
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FROM POVERTY TO POWERcan be broaden
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FROM POVERTY TO POWERbut are largel
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FROM POVERTY TO POWERaltogether. Ru
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FROM POVERTY TO POWERFIGURE 3.2: MO
Page 141 and 142: FROM POVERTY TO POWERin their relat
Page 143 and 144: FROM POVERTY TO POWERliving from lo
Page 145 and 146: FROM POVERTY TO POWERenvironments.
Page 147 and 148: FROM POVERTY TO POWERthem farming o
Page 149 and 150: FROM POVERTY TO POWERThe jury is al
Page 151 and 152: FROM POVERTY TO POWERor credit to i
Page 153 and 154: FROM POVERTY TO POWERplanned mill.
Page 155 and 156: FROM POVERTY TO POWERto begin with.
Page 157 and 158: FROM POVERTY TO POWERprogrammes (SA
Page 159 and 160: FROM POVERTY TO POWERfertilisers to
Page 161 and 162: FROM POVERTY TO POWERDomestic and r
Page 163 and 164: FROM POVERTY TO POWERHOW CHANGE HAP
Page 165 and 166: FROM POVERTY TO POWERTHE CHANGING W
Page 167 and 168: FROM POVERTY TO POWERThe nature of
Page 169 and 170: FROM POVERTY TO POWERNOBODY’S FOR
Page 171 and 172: FROM POVERTY TO POWERFordist mass p
Page 173 and 174: FROM POVERTY TO POWERand Palau have
Page 175 and 176: FROM POVERTY TO POWERA similar situ
Page 177 and 178: FROM POVERTY TO POWERMany unions ha
Page 179 and 180: FROM POVERTY TO POWERBOX 3.5INDIA
Page 181 and 182: FROM POVERTY TO POWERrather than di
Page 183 and 184: FROM POVERTY TO POWEROne trade agre
Page 185 and 186: FROM POVERTY TO POWERPRIVATE SECTOR
Page 187 and 188: FROM POVERTY TO POWERothers see the
Page 189 and 190: FROM POVERTY TO POWERlocal producer
Page 191: FROM POVERTY TO POWERWhile China’
Page 195 and 196: FROM POVERTY TO POWERLocal NGOs and
Page 197 and 198: FROM POVERTY TO POWERbetter off eve
Page 199 and 200: FROM POVERTY TO POWERTwenty years o
Page 201 and 202: FROM POVERTY TO POWERcompanies (for
Page 203 and 204: FROM POVERTY TO POWERhigh- and midd
Page 205 and 206: FROM POVERTY TO POWERtheir comparat
Page 207 and 208: FROM POVERTY TO POWERchange is such
Page 209 and 210: FROM POVERTY TO POWERHOW CHANGE HAP
Page 211 and 212: FROM POVERTY TO POWERCASE STUDYThe
Page 213 and 214: FROM POVERTY TO POWERseason, or whe
Page 215 and 216: FROM POVERTY TO POWERLIVING WITH RI
Page 217 and 218: FROM POVERTY TO POWERInsecurity and
Page 219 and 220: FROM POVERTY TO POWERand withstand
Page 221 and 222: FROM POVERTY TO POWERcomprehensive
Page 223 and 224: FROM POVERTY TO POWERFIGURE 4.2: CA
Page 225 and 226: FROM POVERTY TO POWER(although deli
Page 227 and 228: FROM POVERTY TO POWERfailure, notab
Page 229 and 230: FROM POVERTY TO POWERhave a dignifi
Page 231 and 232: FROM POVERTY TO POWERStandard beare
Page 233 and 234: FROM POVERTY TO POWERWhile more exp
Page 235 and 236: FROM POVERTY TO POWERCASE STUDYtwo
Page 237 and 238: FROM POVERTY TO POWERFINANCE AND VU
Page 239 and 240: FROM POVERTY TO POWERas the insuran
Page 241 and 242: FROM POVERTY TO POWERHUNGER AND FAM
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FROM POVERTY TO POWERfirewood for s
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FROM POVERTY TO POWERthe 1973 droug
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FROM POVERTY TO POWERA human securi
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FROM POVERTY TO POWERof the Black D
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FROM POVERTY TO POWEREveryone has a
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FROM POVERTY TO POWERstate-of-the-a
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FROM POVERTY TO POWER24-hour advice
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FROM POVERTY TO POWERTherefore when
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FROM POVERTY TO POWERHOW CHANGE HAP
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FROM POVERTY TO POWERgovernment to
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FROM POVERTY TO POWERwhether in the
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FROM POVERTY TO POWERIn regions pro
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FROM POVERTY TO POWERThe key to suc
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FROM POVERTY TO POWERBOX 4.5:CUBA V
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FROM POVERTY TO POWERdisaster-drive
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FROM POVERTY TO POWERIn enhancing h
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FROM POVERTY TO POWERhigher confide
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FROM POVERTY TO POWERIn Africa’s
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FROM POVERTY TO POWERtheir source:
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FROM POVERTY TO POWERcommunity and
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FROM POVERTY TO POWERfrom this have
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FROM POVERTY TO POWERLIVING ON THE
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FROM POVERTY TO POWERLike Australia
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FROM POVERTY TO POWERA positive fut
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FROM POVERTY TO POWERcome out all s
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FROM POVERTY TO POWERareas or among
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FROM POVERTY TO POWERToday, though
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FROM POVERTY TO POWERinferior on th
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FROM POVERTY TO POWERreplaced the t
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FROM POVERTY TO POWERCourt, for exa
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FROM POVERTY TO POWERSHOCKS AND CHA
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FROM POVERTY TO POWERMajor changes
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FROM POVERTY TO POWERpassed from be
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FROM POVERTY TO POWERWHO RULES THE
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FROM POVERTY TO POWERPowerful state
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FROM POVERTY TO POWERThroughout the
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FROM POVERTY TO POWERinflationary p
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FROM POVERTY TO POWERWhen critics r
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FROM POVERTY TO POWERFund now both
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FROM POVERTY TO POWERbecome more pr
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FROM POVERTY TO POWERcrisis consist
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FROM POVERTY TO POWER- rather than
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FROM POVERTY TO POWERhis call the f
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FROM POVERTY TO POWER• Sudden inf
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FROM POVERTY TO POWERthe USA is cur
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FROM POVERTY TO POWERto reduce the
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THE INTERNATIONAL TRADING SYSTEMTRA
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FROM POVERTY TO POWERPatents: Intel
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FROM POVERTY TO POWERdumping on wor
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FROM POVERTY TO POWERMost alarming
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FROM POVERTY TO POWERprotectionism
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FROM POVERTY TO POWERThe vast major
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FROM POVERTY TO POWERPrices for som
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FROM POVERTY TO POWER• Establish
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FROM POVERTY TO POWERborder, or at
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FROM POVERTY TO POWERBOX 5.1MIGRANT
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FROM POVERTY TO POWERnumber of‘fr
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FROM POVERTY TO POWERFor example, q
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FROM POVERTY TO POWERMotivated by a
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FROM POVERTY TO POWERIn the Uruguay
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FROM POVERTY TO POWERlong-term deve
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FROM POVERTY TO POWERimportance in
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FROM POVERTY TO POWERUN Global Comp
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FROM POVERTY TO POWERThe drivers of
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FROM POVERTY TO POWERMore broadly,
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FROM POVERTY TO POWERWhatever the m
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FROM POVERTY TO POWERThe heightened
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FROM POVERTY TO POWERThe aid optimi
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FROM POVERTY TO POWERThe aid optimi
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FROM POVERTY TO POWERand 2006/07, f
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FROM POVERTY TO POWERgovernment dow
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FROM POVERTY TO POWERpractice, but
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FROM POVERTY TO POWERWithholding ai
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FROM POVERTY TO POWER1950s and 1960
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FROM POVERTY TO POWERchanged. Simil
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FROM POVERTY TO POWERremain in the
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FROM POVERTY TO POWERand the UN pro
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FROM POVERTY TO POWERA decade on, t
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FROM POVERTY TO POWERCASE STUDYFebr
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FROM POVERTY TO POWERTHE INTERNATIO
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FROM POVERTY TO POWERThe humanitari
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FROM POVERTY TO POWERThe wrong kind
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FROM POVERTY TO POWERlead agencies
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FROM POVERTY TO POWERgovernment in
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FROM POVERTY TO POWERThe only probl
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FROM POVERTY TO POWERopportunity is
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FROM POVERTY TO POWERREFUGEESPeople
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FROM POVERTY TO POWERWest African S
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FROM POVERTY TO POWERdrivers of con
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FROM POVERTY TO POWERCASE STUDYgrou
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FROM POVERTY TO POWERCLIMATE CHANGE
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FROM POVERTY TO POWERwithout heavy
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FROM POVERTY TO POWERunless the wor
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FROM POVERTY TO POWERcap the aspira
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FROM POVERTY TO POWERreduce the qua
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FROM POVERTY TO POWERThe CDM is bes
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FROM POVERTY TO POWERAccused variou
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FROM POVERTY TO POWERemissions by 8
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FROM POVERTY TO POWERBangladesh and
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FROM POVERTY TO POWERGLOBAL GOVERNA
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FROM POVERTY TO POWERNew Zealand wa
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FROM POVERTY TO POWERA NEW DEAL FOR
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FROM POVERTY TO POWER430
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FROM POVERTY TO POWERHOW CHANGE HAP
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FROM POVERTY TO POWERHow change hap
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FROM POVERTY TO POWER• Family str
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FROM POVERTY TO POWERTHE DYNAMICS O
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FROM POVERTY TO POWERseeking change
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FROM POVERTY TO POWERWithin many de
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FROM POVERTY TO POWERSecond, becaus
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FROM POVERTY TO POWER15 For a more
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FROM POVERTY TO POWER41 WaterAid (2
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FROM POVERTY TO POWER121 UNDP (2007
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FROM POVERTY TO POWER46 R. Offenhei
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FROM POVERTY TO POWER106 M. Rama (2
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FROM POVERTY TO POWER172 P. Chaudhr
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FROM POVERTY TO POWER37 FAO (2007).
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FROM POVERTY TO POWER94 IPCC (2007)
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FROM POVERTY TO POWER155 UN OCHA (2
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FROM POVERTY TO POWER34 UN (2006)
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FROM POVERTY TO POWER101 M. Chen (2
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FROM POVERTY TO POWER168 D. Rodrik
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FROM POVERTY TO POWER215 UN Framewo
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FROM POVERTY TO POWERBIBLIOGRAPHYAc
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FROM POVERTY TO POWERBoko, M., I. N
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FROM POVERTY TO POWERCiconello, A.
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FROM POVERTY TO POWERDFID (2005)
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FROM POVERTY TO POWERGaleano, E. (1
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FROM POVERTY TO POWERHopkins Leishe
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FROM POVERTY TO POWERKeynes, J.M. (
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FROM POVERTY TO POWERMoran, T. (200
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FROM POVERTY TO POWEROxfam Intermó
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FROM POVERTY TO POWERRama, M. (2003
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FROM POVERTY TO POWERStockbridge, M
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FROM POVERTY TO POWERUNESCO (2007)
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FROM POVERTY TO POWERWorld Bank (20
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FROM POVERTY TO POWEROxfam Australi
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FROM POVERTY TO POWERGLOSSARYAccoun
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FROM POVERTY TO POWEREffective stat
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FROM POVERTY TO POWERNeoclassicalec
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FROM POVERTY TO POWERINDEXPage numb
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FROM POVERTY TO POWERfinancial inst
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FROM POVERTY TO POWER303, 304, 305,
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FROM POVERTY TO POWERgrowth 114, 18
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FROM POVERTY TO POWERIndia:access t
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FROM POVERTY TO POWERJapan:climate
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FROM POVERTY TO POWERPacific region
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FROM POVERTY TO POWERtransnational
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FROM POVERTY TO POWER241; human sec
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