Day: October 25, 2012
Diaspora communities invest
Diaspora communities are important: they are significant political lobbies, essential support networks, and a critical source of aid to their home countries through remittances. Diaspora communities can make important contributions to development and peacebuilding. Understanding the pivotal role of diaspora communities is the easy part. What’s difficult is finding members of diaspora communities, connecting them and effectively harnessing their motivations to help their home countries.
It is this difficulty that inspired Molly Mattessich of Africa Rural Connect and Homestring’s Eric-Vincent Guichard, the presenters at Tuesday’s event hosted by Microlinks about “Connecting to Diaspora Communities Through Web Portals.”
Africa Rural Connect was developed by the National Peace Corps Association in 2009 to address major rural agricultural challenges in Africa with the help of rural African farmers, especially women. The site functions as a meeting place for members of the African Diaspora, people in Africa, and people connected to the Peace Corps. On the site, people can “offer,” “remix,” and “endorse” ideas in addition to “pledging” money or time to events they like the most, though no financial transactions take place on the site. Through periodic competitions, the most popular ideas win cash prizes. Measuring the impact of the ideas generated on the site is hard because Africa Rural Connect does not follow their progress. It can report that there have been over 20,000 profiles created from 130 countries. About a third are members of the African Diaspora, another third live in Africa, and a final third are academics, people in the development field and entrepreneurs.
Homestrings uses a different approach based on the desire of members of the African Diaspora to invest in their homelands. Roughly $450 billion in remittances is sent from the West to emerging markets each year. Of that, Homestrings figures ten billion dollars per year comes from members of the African Diaspora looking to invest in Africa. Homestrings overcomes barriers diaspora communities face in investing at home by providing a credible, transparent, professional, and customer-oriented investment platform. A study prepared by George Washington University in collaboration with USAID and Western Union concluded that contrary to popular opinion, diaspora communities want to invest in their home countries not just for emotional or political reasons, but because they hope to get a return on their investment. The most often reported way diaspora communities connect with their homeland is through the internet. Homestrings offers a web-based investment platform where potential investors can find projects, endorse or invest in projects they like and manage their investments. Since February of 2012, Homestrings users have invested over $25 million. Homestrings plans to expand to Asia and Latin America.
Peacebuilding is expanding. Research, like the report considered in this post, indicates that intelligent development efforts are often necessary components of work to make and maintain peace. Using the internet to help diaspora communities invest shows promise.
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More than fiscal crisis in Palestine
Despite all of the media attention Israel and Palestine usually receive, no one is talking about Palestine’s fiscal crisis. Kate Seelye of the Middle East Institute (MEI) opened a panel hosted by MEI and Johns Hopkins SAIS on “The Political and Economic Implications of the Palestinian Authority’s Fiscal Crisis” by noting the presidential debates made it clear this issue will only receive less attention in the future, regardless of who is elected. The panelists explained that the world cannot afford to put this issue aside. Unless progress is made a two-state solution may become impossible.
Hussein Ibish, senior fellow at the American Task Force on Palestine and the event’s moderator, summarized the fiscal crisis: the failed Palestinian UN bid in September of 2011 caused a crisis in the donor community, which provides one billion dollars to the Palestinian Authority per year. The Palestinian Authority has been unable to pay state employees on time. Oussama Kanaan of the International Monetary Fund pointed to a confusing aspect of this problem: the amount of money that the Palestinian Authority needs to pay all of its employees is relatively small, so why has no donor come forward? There is a $400 million deficit, assuming the United States pays the $200 million it pledged (which is not certain given Palestine’s announcement that it will petition in November to become a nonmember observer). At a recent donor meeting in New York, France came forward, but only with $10 million.
When the risks are so high, why is there resistance to action? Kanaan hypothesized that donors are unwilling to commit until the peace process has been revitalized. This was true during the Palestinian fiscal crisis of 2007 so the donor community, Israel, and Palestine met in December of 2007 in Paris to lay out a transition plan. Israel committed to gradually relax restrictions on the movement of goods and people and Palestine promised to strengthen its institutions. The World Bank and the IMF measured progress based on benchmarks over the period between 2008 and 2010. The results exceeded expectations, but in 2012 after Palestine’s failed UN bid and the expiration of the three year plan, the international community finds itself without a strategy. The advances made between 2008 and 2010 are unraveling.
Kanaan offers two possible solutions: convene another meeting like the Paris one in December 2007 or quit struggling for a transition solution and start work on a permanent plan for peace and stability.
Brookings Institution’s Khaled Elgindy supports the latter solution. “The peace process is dead,” he said. It is time to look for different strategies. The peace process failed because it was unbalanced, disjointed and detached from reality. The different application of the Quartet principles and the Road Map illustrates the imbalance. The former is applied as if it had the strength of a Security Council Resolution, but the UNSC-endorsed Road Map has been ignored and destroyed by Israel with Quartet support, he said.
The peace process was built on contradictions. The Palestinian Authority is a government without a state. It is treated as representing all of Palestine when there is a divide between the West Bank and Gaza. The peace process actually facilitated the occupation of Palestine and its dependence on foreign aid. It is impossible to have a healthy economy under occupation, especially when the state is not in control of 60% of its territory or the movement of people and goods. The failure of the peace process is intimately connected to the failure of legitimacy. Years of failed negotiations, the Palestinian Authority’s inability to represent all of Palestine, and the lack of Palestinian control of Gaza eroded the Palestinian Authority’s leadership.
The failures of the peace process and leadership pushed US/Palestinian relations into the “realm of infantilization,” said Elgindy. Elgindy quoted a State Department official in 2012 saying that what matters to the peace process is that the prime minister and the president remain in power. This remark is troubling at a time when the United States is supporting citizen-led movements to make governments more responsive to the people. Elgindy’s solution is that we let the peace process go and focus on doing no harm, building consensus, and ending the occupation.
Robert Danin of the Council on Foreign Relations agreed with Elgindy and Kanaan on the problematic lack of a working peace process and Israel’s failure to relax restrictions enough. Danin emphasized that there is a lot happening on the ground, though the international political conversation doesn’t reflect this. Though the United States pulled back in 2011, other states have been working to keep a more serious crisis from developing. Usually political progress precedes changes on the ground, but the Palestinian Authority met the Paris benchmarks marking it a stable, functioning government but now has no political process to support it. Israel won’t make concessions without being asked. A Netanyahu aide told Danin that there was no incentive to help if Israel was not going to receive anything for its concessions. Danin argued that the solution is to take action before all faith in a two-state solution dies, but with a new conceptual approach where economics and politics are taken together.
Though Danin believes time might really be running out for a two-state solution, Elgindy argued that the peace process and a two-state solution are not the same. The death of one does not mean there is no hope for the other. Danin reported that in 2001 and 2002 during the intifada the international community thought the peace process was dead, but with effort it was revitalized. Prime Minister Salam Fayyad also said recently that he would accept a deal like the one offered by Prime Minister Olmert in 2008. This goes to show, Danin said, there is a difference in the Middle East between dead, really dead, and so dead there’s no hope. Hopefully the peace process is just “dead.”
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The guests who won’t come calling
Today is turning into a Balkans day. It must have been less than 5 minutes after I posted about the SecState visit to the Balkans with Lady Ashton that I got a note complaining that they weren’t going to Macedonia. I’d of course be perfectly happy if they did go to Macedonia, but I’m not sure the Macedonians would be delighted. When the EU and the U.S. come calling, they do it wanting results.
In Belgrade and Pristina, they will be looking for further progress on the bilateral dialogue, which already had a big moment last week with a meeting between the two prime ministers. A settlement of north Kosovo is presumably in the works, though I doubt it will be full-fledged by the end of the month. I don’t really know what they can hope for in Sarajevo. The political situation there is a shambles. They may be content to give a pep talk.
In Skopje, they would necessarily be looking for progress on the “name” issue, which means they would have to go to Greece as well. I can think of a lot of reasons why they might not want to do that. In addition, Washington and Brussels have come to believe that Macedonia’s Prime Minister Gruevski is a big part of the problem in the decades-long search for a name (other than Former Yugoslav Republic of Macedonia, or FYROM) that Greece will accept. He seems to think he is better off just leaving things as they are, since everyone except Greeks calls the country Macedonia (even Greek officials don’t object any more).
The big problem for Gruevski and Macedonia is that they have been blocked from entering NATO because of the “name” issue. This is unjust, as the International Court of Justice (ICJ) said clearly and unequivocally last December. But Athens has convinced Washington not to bulldoze it into accepting FYROM, despite the Interim Accord that obligates Greece to do so.
I imagine that if Gruevski rang up the State Department and told them he is willing to accept a “qualifier” (as in North Macedonia) that he might get a SecState and HiRep visit. He does not want to do that because Greece is insisting that any solution be used for all purposes, including every time the name of the country is mentioned in its constitution. I imagine that is at least as difficult for him to swallow as it would be for other prime ministers.
I am notoriously sympathetic with the Macedonians on this question: I think any country (and people) is entitled to call itself what it wants, as in Estados Unidos Mexicanos. Also “Americans,” which is a term some of my Latin American and Canadian friends think should be available to them as well as citizens of the United States. Fat chance they have of stopping us from using it as we like, or we them.
I don’t for a moment believe that Skopje has designs on Greek territory. Certainly its claims, if it had any, would be no better than those of Mexico on large parts of the United States, and the power relationship between the two countries is similar. Greece needs to get over its fear of Macedonia and unworthy defiance of the ICJ decision.
But none of that is likely to get Skopje a visit from Hillary Clinton and Lady Ashton.
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A costly enterprise
Insider is a popular Serbian investigative documentary TV programme produced by brave young journalists committed to seeking the truth. Over the past several years, Insider has managed to discover numerous unlawful activities, including serious instances of organized crime and high-level corruption, many of which involve prominent domestic politicians. In some cases Insider‘s revelations led to police investigations, but few have resulted in official verdicts due to the inefficiency of Serbia’s judicial system. After a series on criminal activities of Serbian football hooligans, the interior ministry immediately gave Brankica Stanković, the producer of Insider, 24/7 police protection.
The latest serial by Insider, called “Patriotic Pillage,” deals with financial damage to Serbia’s budget as a consequence of its Kosovo policy. In four episodes broadcast so far, viewers have seen how Serbia is losing millions of euros through tax evasion and other fraud. Insider has brought to light evidence of what was already long suspected.
It began in 2005, when the Serbian government under then prime minister Vojislav Koštunica exempted domestic companies from paying value-added tax for the commodities sold on the territory of Kosovo. Officially, the intention was to ease the life of Kosovo Serbs by allowing them to buy goods at lower prices. In practice, the government’s decision has given rise to enormous malversations.
The way it works is simple. A company from Serbia receives a purchase order from its partner company in Kosovo. Sometimes, the owner of the company based in Serbia would open another company in Kosovo, which then orders commodities from the original company only to secure the documents needed for VAT deduction. That way one is virtually selling one’s own goods to oneself. The company’s truck is then dispatched to a customs checkpoint at the boundary/border with Kosovo, where it gets the certificate necessary for exemption from VAT. But instead of proceeding to Kosovo, the truck turns back to Serbia and the goods supposed to be sold in Kosovo at a lower price are eventually sold in Serbia at the full price. The company thus appropriates the amount of the VAT as hidden extra profit.
In some cases, though, a portion of the load is smuggled into the northern – Serb-dominated – part of Kosovo via so-called “alternative roads.” The Insider team managed to covertly film transshipment from bigger trucks to smaller ones, as well as a Serbian police vehicle escorting a convoy of trucks down an alternative route all the way to the boundary/border. In cooperation with their Albanian counterparts, Serb businessmen from the North have also developed a smuggling network through which goods from Serbia are being smuggled into the territory south of the Ibar river, which is under Priština’s authority.
Another form of malversation concerns Serbia’s budget expenditure for Kosovo. The Insider team has calculated that since Serbia lost sovereignty over Kosovo in 1999, the country has, on average, been spending on its former province around 650 thousand euros per day. This is a large amount of money in Serbian terms: over 230 million euros per year. Rather than being transferred to people in need, the bulk of this money has ended up in private pockets of politically favored individuals. Many of them are receiving salaries from both Belgrade and Priština, and some do not even live in Kosovo anymore.
Most political leaders of the Serbs from northern Kosovo – particularly members of Koštunica’s Democratic Party of Serbia (DSS) – have repeatedly refused Insider‘s request to tell their version of the story. Instead, they continue to condemn the Insider team as “anti-Serb propagandists who only want to divide Serbs, pitting them against one another.” Such rhetoric is strikingly reminiscent of how the Milošević regime demonized its political opponents in the 1990s.
Members of the Insider team were not allowed to attend a recent joint session of Serb delegates from northern Kosovo municipalities, even though it was formally open to the public. A group of men, who appeared to be engaged as private security personnel, prevented Insider‘s journalist from entering the building where the meeting was held. Journalists from other media were allowed in. The only politician who has meanwhile apologized to the Insider team for the incident is Krstimir Pantić, the Mayor of Northern Mitrovica.
Unlike Serb politicians from northern Kosovo, some former Serbian government officials agreed to appear in the series. While they did not try to deny the evidence presented to them – since it entirely consists of official documents issued by Serbian authorities – their reaction generally came down to a shrug. They claimed they had no instruments to control how money was used once it had reached Serb-governed institutions in Kosovo.
In response to the “Patriotic Pillage,” the government in Belgrade has announced that those receiving double salaries – i.e. from both Belgrade and Priština – will soon have relinquish one of them. Deputy prime minister Aleksandar Vučić, who is also the coordinator of all security and intelligence services, has promised a thorough investigation into the practices discovered by Insider. But there are loopholes in the legislation that may make legal what would normally be considered illegal. People are generally inclined to believe those loopholes were created deliberately, which points to their deep mistrust of the country’s institutions.
Whatever the outcome, the “Patriotic Pillage” serial has demonstrated that excessive “patriotism” can sometimes prove a costly enterprise. The price of not recognizing the Kosovo reality is not only political but also economic.
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To concert is a virtue
The weekend allowed me to look at a number of interesting reports on the Balkans. The common thread of the two I cite below is the recognition that the issues still plaguing Albania and Bosnia require concerted regional and international approaches. It is often difficult to take concerted action, but when we do we tend to get results that are worth the effort.
1. Antoinette Primatarova and Johanna Deimel, Bridge Over Troubled Waters? The Role of the Internationals in Albania. Unsparing, they fault the internationals for failing to see the negative implications of 2008 constitutional amendments that ushered in a retrograde period in Albania’s young democracy. But they see hope in the EU commission’s advocacy of 12 key priorities, now embraced by the Albanian government and opposition and supported by the U.S.
2. Kurt Bassuener and Bodo Weber, Croatian and Serbian Policy in Bosnia-Herzegovina: Help or Hindrance? Equally unsparing of past mistakes that allowed Croatia and Serbia to favor their conationals within Bosnia and thereby undermine the country’s unity, they want to see a more concerted U.S., EU and Turkish effort to turn Zagreb and Belgrade in the direction of supporting the Bosnian state. I’m not seeing this one posted yet on the Democratization Policy Council’s website, but I’ll come back and install a link when it appears there (and someone tells me so).
I haven’t seen a recent report on the international mistakes in Kosovo and the importance of concerted action there to overcome remaining problems between Belgrade and Pristina, but of course one could be written. We saw in September the completion of the internationally imposed agenda for the four and a half year period of Kosovo’s “supervised independence.” Last week, with the meeting between Prime Ministers Thaci and Dacic, we witnessed how effective concerted action by the U.S. and EU can be in pushing the remaining issues to the political level, even if there is good reason to be concerned with the lack of implmentation of earlier “technical” agreements.
Of course none of this figured in this week’s presidential debate, but it is relevant: collaboration with the EU enables the U.S. to help resolve Balkans problems on the cheap, committing little more than the diplomatic and political weight of its oversized missions in Belgrade, Pristina, Sarajevo and Zagreb plus the occasional phone call from Hillary Clinton or one of her minions. The EU provides the bulk of the troops, money and “European perspective” required to rescue countries that 20 years ago were basket cases. Sharing burdens is a lot better than carrying them on our own, especially if our vital interests are not at stake. Which they are not in the Balkans.
After I’d written the text above, the State Department announced yesterday that Lady Ashton, the European Union’s High Representative (foreign minister, more or less) and Hillary Clinton will travel together to Bosnia and Herzegovina, Serbia and Kosovo October 29-November 1. This is very much the right approach. If they can concert their messages as well as their travel plans, there is nothing really important in the Balkans that can’t be solved. That includes the political mess in Bosnia as well as the difficult relations between Belgrade and Pristina.
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