The Newest Threat to People and the Planet

The Rise of “Sub-Imperialism”

26 November 2012 by Patrick Bond


The heads of state of the Brazil-Russia-India-China-South Africa BRICS network are coming to Durban in four months, meeting on 26-27 March at the International Convention Centre (ICC), Africa’s largest venue. Given their recent performance, it is reasonable to expect another ‘1%’ summit, wreaking socio-economic and ecological havoc. And that means it is time for the first BRICS counter-summit, to critique top-down ‘sub-imperialist’ bloc formation, and to offer bottom-up alternatives.

After all, we have had some bad experiences at the Durban ICC:

- in 2001, in spite of demands by 10,000 protesters, the United Nations World Conference Against Racism refused to grapple with reparations for slavery and colonialism or with apartheid-Israel’s racism against Palestinians (hence Tel Aviv’s current ethnic cleansing of Gaza goes unpunished);

- the African Union got off to a bad start here, with its 2002 launch, due to reliance on the neoliberal New Partnership for Africa’s Development (Nepad) promoted by Pretoria;

- the 2003 World Economic Forum’s African regional meeting hastened governments’ supplication to multinational corporate interests in spite of protests;

- in 2011, Durban’s UN COP17 climate summit – better known as the ‘Conference of Polluters’ – featured Washington’s sabotage, with no new emissions cuts and an attempted revival of the non-solution called ‘carbon trading Market activities
trading
Buying and selling of financial instruments such as shares, futures, derivatives, options, and warrants conducted in the hope of making a short-term profit.
’, also called ‘the privatization of the air.’

Eco-disasters made in Durban

“The Durban Platform was promising because of what it did not say,” bragged US State Department official Trevor Houser to the New York Times. “There is no mention of historic responsibility or per capita emissions. There is no mention of economic development as the priority for developing countries. There is no mention of a difference between developed and developing country action.”

The Durban deal squashed poor countries’ ability to defend against climate disaster. With South African foreign minister Maite Nkoana-Mashabane in the chair, the COP17 confirmed this century’s climate-related deaths of what will be more than 180 million Africans, according to Christian Aid. Already 400 000 people die each year from climate-related chaos due to catastrophes in agriculture, public health and ‘frankenstorms’ like last month’s Sandy.

Degeneration of global governance is logical when Washington unites with the BRICS countries, as was first demonstrated three years ago with the Copenhagen Accord. At that COP, Jacob Zuma, Brazil’s Lula da Silva, China’s Wen Jiabao and India’s Manmohan Singh joined Barack Obama to foil the Kyoto Protocol’s mandatory emissions cuts, thus confirming that at least 4 degrees global warming will occur by 2100. “They broke the UN,” concluded Bill McKibben from the climate advocacy movement 350.org.

The negotiators were explicitly acting on behalf of their fossil fuel and extractive industries. Similar cozy ties between Pretoria politicians, London-based mining houses, Johannesburg ‘Black Economic Empowerment’ tycoons and sweetheart trade unions have since been exposed at Marikana, with another blast against climate anticipate as fracking begins in the Western Cape, Eastern Cape and KwaZulu-Natal’s Drakensburg Mountains, driven by multinational corporate oil firms led by Shell.

The 2012 Yale and Columbia University Environmental Performance Index showed that aside from Brazil, the other BRICS states are decimating their – and the earth’s – ecology at the most rapid rate of any group of countries, with Russia and South Africa near the bottom of world stewardship rankings.

Looting Africa

Like Berlin in 1884-85, the BRICS Durban summit is expected to carve up Africa more efficiently, unburdened – now as then – by what will be derided as ‘Western’ concerns about democracy and human rights. Reading between the lines, its resolutions will:

- support favoured corporations’ extraction and land-grab strategies;

- worsen Africa’s retail-driven deindustrialization (SA’s Shoprite and Makro – soon to be run by Walmart – are already notorious in many capital cities for importing even simple products that could be supplied locally);

- revive failed projects such as Nepad; and

- confirm the financing of both land-grabbing and the extension of neo-colonial infrastructure through a new ‘BRICS Development Bank’ likely to be based just north of Johannesburg, where the Development Bank of Southern Africa already does so much damage following Washington’s script.

The question is whether in exchange for the Durban summit amplifying such destructive tendencies, which appears certain, those of Africa’s elites who may be invited can leverage Leverage This is the ratio between funds borrowed for investment and the personal funds or equity that backs them up. A company may have borrowed much more than its capitalized value, in which case it is said to be ’highly leveraged’. The more highly a company is leveraged, the higher the risk associated with lending to the company; but higher also are the possible profits that it may realise as compared with its own value. any greater power in world economic management via BRICS. With SA finance minister Pravin Gordhan’s regular critiques of the World Bank World Bank
WB
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

and International Monetary Fund IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org
(IMF), there is certainly potential for BRICS to ‘talk left’ about the global-governance democracy deficit.

But watch the ‘walk right’ carefully. In the vote for Bank president earlier this year, for example, Pretoria’s choice was hard-core Washington ideologue Ngozi Okonjo-Iweala, the Nigerian finance minister who with IMF managing director Christine Lagarde catalyzed the Occupy movement’s near revolution in January, with a removal of petrol subsidies. Brasilia chose the moderate economist Jose Antonio Ocampo and Moscow backed Washington’s choice: Jim Yong Kim.

This was a repeat of the prior year’s fiasco over the race for IMF Managing Director, won by Lagarde – in spite of ongoing corruption investigations against her by French courts – because the Third World was divided-and-conquered. BRICS appeared in both cases as incompetent, unable to even agree on a sole candidate, much less win their case in Washington.

Yet in July, BRICS treasuries sent $100 billion in new capital to the IMF, which was seeking new systems of bail-out for banks exposed in Europe. South Africa’s contribution was only $2 billion (R17.5 billion), a huge sum for Gordhan to muster against local trade union opposition. Explaining the SA contribution – initially he said it would be only one tenth as large – Gordhan told Moneyweb last year that it was on condition that the IMF became more ‘nasty’ (sic) to desperate European borrowers, as if the Greek, Spanish, Portuguese and Irish poor and working people were not suffering enough.

And the result of this BRICS intervention is that China gains IMF voting power, but Africa actually loses a substantial fraction of its share Share A unit of ownership interest in a corporation or financial asset, representing one part of the total capital stock. Its owner (a shareholder) is entitled to receive an equal distribution of any profits distributed (a dividend) and to attend shareholder meetings. . Even Gordhan admitted at last month’s Tokyo meeting of the IMF and Bank that it is likely “the vast majority of emerging and developing countries will lose quota shares – an outcome that will perpetuate the democratic deficit.” And given “the crisis of legitimacy, credibility and effectiveness of the IMF,” it “is simply untenable” that Africa only has two seats for its 45 member countries.

But likewise, South Africa’s role in Africa has been nasty, as confirmed when Nepad was deemed ‘philosophically spot on’ by lead US State Department Africa official Walter Kansteiner in 2003, and foisted privatisation of even basic services on the continent. In a telling incident this year, the Johannesburg parastatal firm Rand Water was forced to leave Ghana after failing – with a Dutch for-profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. partner (Aqua Vitens) – to improve Accra’s water supply, as also happened in Maputo (Saur from Paris) and Dar es Salaam (Biwater from London).

As a matter of principle, BRICS appears hellbent on promoting the further commodification of life, at a time the greatest victory won by ordinary Africans in the last decade is under attack: the Treatment Action Campaign demand for affordable access to AIDS medicines, aided by India’s cheap generic versions of drugs. A decade ago, they cost $10,000 per person per year and a tiny fraction of desperate people received the medicines. But now, more than 1.5 million South Africans – and millions more in the rest of Africa – get treatment, thus raising the SA collective life expectancy from 52 in 2004 to 60 today, according to reliable statistics released this month.

However, in recent months, Obama has put an intense squeeze on India to cut back on generic medicine R&D and production, as well as making deep cuts in his own government’s aid commitment to funding African healthcare. In Durban, the city that is home to the most HIV+ people in the world, Obama’s move resulted in this year’s closure of AIDS public treatment centres at three crucial sites. One was the city’s McCord Hospital, which ironically was a long-standing ally of the NGO Partners in Health, whose cofounder was Obama’s pick for World Bank president, Jim Kim.

‘Sub-imperialism’?

So we must ask, are the BRICS ‘anti-imperialist’ – or instead, ‘sub-imperialist’, doing deputy-sheriff duty for global corporations, while controlling their own angry populaces as well as their hinterlands? The eco-destructive, consumerist-centric, over-financialised, climate-frying maldevelopment model throughout the BRICS works very well for corporate profits, but the model is generating crises for 99% of the people and for the planet.

Hence the label sub-imperialist is tempting. As originally formulated during the 1970s, Ruy Mauro Marini argued that his native Brazil is “the best current manifestation of sub-imperialism,” for these reasons:

- “Doesn’t the Brazilian expansionist policy in Latin America and Africa correspond, beyond the quest for new markets, to an attempt to gain control over sources of raw materials – such as ores and gas in Bolivia, oil in Ecuador and in the former Portuguese colonies of Africa, the hydroelectric potential in Paraguay – and, more cogently still, to prevent potential competitors such as Argentina from having access to such resources?

- “Doesn’t the export of Brazilian capital, mainly via the State as exemplified by Petrobras, stand out as a particular case of capital export in the context of what a dependent country like Brazil is able to do? Brazil also exports capital through the constant increase of foreign public loans and through capital associated to finance groups which operate in Paraguay, Bolivia and the former Portuguese colonies in Africa, to mention just a few instances.

- “It would be good to keep in mind the accelerated process of monopolization (via concentration and centralization of capital) that has occurred in Brazil over these past years, as well as the extraordinary development of financial capital, mainly from 1968 onward.”

Matters subsequently degenerated on all fronts. In addition to these three criteria – regional economic extraction, ‘export of capital’ (always associated with subsequent imperialist politics) and internal corporate monopolization and financialisation – there are two additional roles of BRICS if they are genuinely sub-imperialist. One is to ensure regional geopolitical ‘stability’: for example, Brasilia’s hated army in Haiti and Pretoria’s deal-making in African hotspots like South Sudan and the Great Lakes, for which a $5 billion arms deal serves as military back-up.

The second is to advance the broader agenda of neoliberalism, so as to legitimate continuing market access – typical of South Africa’s Nepad, China, Brazil and India’s attempt to revive the WTO WTO
World Trade Organisation
The WTO, founded on 1st January 1995, replaced the General Agreement on Trade and Tariffs (GATT). The main innovation is that the WTO enjoys the status of an international organization. Its role is to ensure that no member States adopt any kind of protectionism whatsoever, in order to accelerate the liberalization global trading and to facilitate the strategies of the multinationals. It has an international court (the Dispute Settlement Body) which judges any alleged violations of its founding text drawn up in Marrakesh.

, and Brazil’s sabotage of the left project within the ‘Bank of the South’ initiative. As Belgian political economist Eric Toussaint remarked at a World Social Forum panel in Porto Alegre in 2009, “The definition of Brazil as a peripheral imperialist power is not dependent on which political party is in power. The word imperialism may seem excessive because it is associated with an aggressive military policy. But this is a narrow perception of imperialism.”

A richer framing for contemporary imperialism is, according to agrarian scholars Paris Yeros and Sam Moyo, a system “based on the super-exploitation of domestic labour. It was natural, therefore, that, as it grew, it would require external markets for the resolution of its profit realisation crisis.” This notion, derived from Rosa Luxemburg’s thinking a century ago, focuses on how capitalism’s extra-economic coercive capacities loot mutual aid systems and commons facilities, families (women especially), the land, all forms of nature, and the shrinking state – and has also been named ‘accumulation by dispossession’ by David Harvey, and in special cases evoking militarist intervention, Naomi Klein’s ‘Shock Doctrine’.

Along with renewed looting are various symptoms of internal crisis and socio-economic oppressions one can find in many BRICS, including severe inequality, poverty, unemployment, disease, violence (again, especially against women), inadequate education, prohibitions on labour organising and other suffering.

The rising inequality within BRICS – except for Brazil whose minimum wage increase lowered the extreme Gini coefficient to at least a bit below South Africa’s – is accompanied by worsening social tensions, which in turn is responded to with worsening political and civil rights violations, such as increased securitisation of societies, militarisation and arms trading, prohibitions on protest, rising media repression and official secrecy, debilitating patriarchy and homophobia, activist jailings and torture, and even massacres (including in Durban where a notorious police hit squad killed more than 50 people in recent years, and even after unveiling by local media and attempted prosecutions, continues unpunished today).

The forms of sub-imperialism within BRICS are diverse, for as Yeros and Moyo remark, “Some are driven by private blocs of capital with strong state support (Brazil, India); others, like China, include the direct participation of state-owned enterprises; while in the case of South Africa, it is increasingly difficult to speak of an autonomous domestic bourgeoisie, given the extreme degree of de-nationalisation of its economy in the post-apartheid period. The degree of participation in the Western military project is also different from one case to the next although, one might say, there is a ‘schizophrenia’ to all this, typical of ‘sub-imperialism’.”

As a result, all these tendencies warrant opposition from everyone concerned. The results are going to be ever easier to observe, the more that BRICS leaders prop up the IMF’s pro-austerity financing and catalyse a renewed round of World Trade Organisation attacks; the more a new BRICS Development Bank exacerbates World Bank human, ecological and economic messes; the more Africa becomes a battleground for internecine conflicts between sub-imperialists intent on rapid minerals and oil extraction (as is common in central Africa); and the more specific companies targeted by victims require unified campaigning and boycotts to generate solidaristic counter-pressure, whether Brazil’s Vale and Petrobras, or South Africa’s Anglo or BHP Billiton (albeit with London and Melbourne hqs), or India’s Tata or Arcelor-Mittal, or Chinese state-owned firms and Russian energy corporations.

One opportunity to link issues and connect-the-dots between campaigns so as to find a unifying anti-subimperialism that aligns with our critique of global capitalism, is within a Durban uncivil-society counter-summit next March 23-27. Like the rest of South Africa, Durban has witnessed an upsurge of socio-economic conflict in recent months, and it is incumbent upon visitors to understand where tensions are emerging so that similar processes in the other BRICS are not left isolated.

An overall objective is to ‘rebuild BRICS from below’, so the usual ‘globalisation-from-the-middle’ talk-shops – featuring speeches by petit-bourgeois NGO strategists and radical intellectuals (like myself) – must be balanced through community-based teach-ins where Reality Tours and sharing between oppressed peoples take precedence.

One of the most critical sites is South Durban, where a $30 billion project to destroy two black neighbourhoods (Clairwood and Merebank) through 10-fold expansion of shipping, freight and petro-chemical activity is being vigorously contested. The narratives of the communities resisting go well beyond ‘Not in My Back Yard’ reasoning, and instead much more widely question the extractivist, export-oriented model of maldevelopment that has seduced the current South African government, as well as other BRICS.

Watch for more details from some of the welcoming groups: http://ccs.ukzn.ac.za, http://www.groundwork.org.za, http://www.sdcea.co.za and http://www.amandla.org.za

Patrick Bond Bond A bond is a stake in a debt issued by a company or governmental body. The holder of the bond, the creditor, is entitled to interest and reimbursement of the principal. If the company is listed, the holder can also sell the bond on a stock-exchange. directs the UKZN Centre for Civil Society – host institution for last year’s COP17 counter-summit – and authored Politics of Climate Justice, UKZN Press.

Source: Counterpunch



Patrick Bond

Patrick Bond is professor of political economy at the Wits University School of Governance in Johannesburg and co-editor of BRICS: An anti-capitalist critique (published by Haymarket, Pluto, Jacana and Aakar).

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