Foreign Aid

Rio Agenda: Soak the West’s Taxpayers

“Fear by the North of environmental degradation provides the South the leverage that did not exist before.”

By Patricia Adams, published by the Wall Street Journal on June 3, 1992

The Third World’s elite and their global groupies have descended upon the U.N.-organized Earth Summit meeting this week in Rio de Janeiro with plans to extract up to $140 billion a year from Western taxpayers. “Fear by the North of environmental degradation provides the South the leverage that did not exist before,” Prime Minister Mahathir Mohamad of Malaysia told fellow G-77 members (the Third World’s answer to the G-7) a month ago in Kuala Lumpur. “It is fully justified for us to approach it this way.”

The only way for Third World countries to avoid environmental damage, Dr. Mahathir went on, “is for them to receive substantial material help.” Translation: If the West expects countries like Malaysia to stop razing their tropical forests, the West will have to pay the price.

To compensate Third World nations for protecting their environments, Brazil and Argentina have suggested a long list of mechanisms in a joint submission to the United Nations General Assembly.

Among them would be a tax on newspapers. A mere one-tenth of a cent levy on each of the 63,546,000 papers read each day in the U.S. alone would yield almost $23.2 billion a year. Brazil and Argentina envisage taxing newspaper readers in all OECD countries.

Agenda 21

Another Brazilian-Argentine proposal is what they call Green Mail: “An environmental stamp would be created to be used compulsorily in all international correspondence.” The two governments happily note that more than 8 billion pieces of mail were sent across international borders in 1989.

Call it Green Mail or call it blackmail, Rio will almost certainly start the ball rolling on Agenda 21 – the U.N.’s 900-page master plan to save the world’s environment in the 21st century. Less certain will be who controls the transfer of funds from Western taxpayers to Third World treasuries, and how big the heap’s to be. The U.N. estimates an eventual requirement of $125 billion per year. The World Bank believes a mere $80 billion – jointly financed by the Third World and the West – will do the job.

The rich G-7 countries’ candidate to control whatever money does get transferred is the Global Environment Facility – a three-year-old experiment in environmentally friendly funding run by the World Bank and two U.N. agencies. But the poorer countries assembled in the misnamed G-77 (the group actually has 128 members) is leery of letting these large sums be controlled by institutions under developed country thumbs. They want a Green Fund financed by the rich countries but with a “democratic” structure – one country, one vote. China wants rich countries “assessed” in proportion to their gross domestic product.

While this tug of war between G-7 and G-77 goes on, few have awakened to what either’s pork barrel would mean for the global environment. A Green Fund would bankroll countries like Malaysia, whose governments have seized vast native land-holdings in the past decade and then doled out logging licenses for them to favored concessionaries. In the Malaysian state of Sarawak on the island of Borneo – scene of some of the world’s most indiscriminate logging of ancient rainforests – almost all timber concessions are owned by Malaysian politicians, their relatives or their companies.

Other advocates of the proposed tax grab of the developed countries’ resources – the governments of China, India, Pakistan and Ghana – make no less outrageous custodians of their peoples’ environments. The Chinese government champions Green Funds to combat soil and water degradation. But it plans to build an economically and environmentally ruinous dam on the Yangtze.

A feasibility study could justify the Yangtze project’s $10.7 billion cost only by grossly overestimating benefits and understating costs. To minimize estimated resettlement costs, it was assumed that 500,000 people would be left to live in the flood storage area on the reservoir’s rim. To minimize foreign exchange costs, the study assumed China’s administered rate for the yuan, rather than the far less flattering free-market rate. Though the Yangtze is a major transport artery, the study altogether ignored disruption to the port at Chongqing and destinations downstream during the dam’s 18-year construction period. The costs of soil erosion and damage to coastal farming were also slighted, as were the costs to relocating the 1.2 million people who would have to move.

India, like China, has played fast and loose with its people’s environment. The once thriving agricultural community of Singrauli in north India has been reduced to destitution by contamination from the 12 state-owned coal-fired electricity-generating plants they have as neighbors. Water infused with coal-ash slurry and air laden with dust and sulphur dioxide has precipitated a public health disaster.

Eighty thousand Ghanaian farmers and fishermen lost their homes to make way for the foreign-aid financed Akosombo dam and what became the world’s largest man-made lake, Lake Volta. Residents in the vicinity of Lake Volta have become infected with bilharzia, a debilitating disease spread by a snail that thrives in large bodies of still water. Erosion of the Ghanaian coastline – no longer replenished by upstream sediment – has swept tens of thousands of homes in the seaside town of Keta into the sea. The erosion has also affected neighboring Togo, destroying the coastal highway, submerging palm oil plantations and threatening the piers from which the country’s phosphates are exported. Now foreign aid donors have pledged another $50 million to undo the damage the original foreign aid did.

The World Bank’s track record is no less bad. Its Polonoroeste project, a vast colonization scheme in Brazil’s Amazon watershed, lured a million settlers into the region with subsidies and promises of fertile land. But beneath the lush, rain-forest canopy, the soils were poor, and the settlers were forced into wave upon wave of additional clearances, creating a 15,000 square mile wasteland. The World Bank’s publicists have since put a bright face on the disaster, claiming in 1990 in their first annual environmental report, that the resulting adverse publicity “fostered a growing political and public commitment to preserve the Amazon’s remaining natural resources.”

Government the Problem

Recklessness on this scale has led many environmentalists and citizen activists throughout the Third World to conclude that money in the hands of their governments is the cause of environmental problems, not their solution. Without easy money from foreign aid organizations and foreign banks, Third World governments could not have afforded the host of uneconomic development projects – from dams to logging operations to mining schemes – that have expropriated private and village lands to ruinous economic and environmental results. Unaccountable governments and international institutions with the power to extinguish local property and customary rights for the supposed “national good” are at the root of many of the Third World’s environmental disasters.

Third World governments want money, and to get it are prepared to hold hostage their people and the environment upon which their people depend. The Western governments reeling from often justified criticism of their own environmental records – want to buy the silence of their critics. But throwing money at the problem only promises to compound the damage while ignoring the Third World public’s increasing demands that their governments respect local property and customary rights. The Western leaders should listen to the presumed beneficiaries of their largess, and say “no” to more money.

Ms. Adams, executive director of Probe International, a Toronto environmental group, is the author of “Odious Debts: Loose Lending, Corruption, and the Third World’s Environmental Legacy” (Earthscan, 1991).



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