Tag: World Bank

ONE BANK HAS TORN THE WORLD IN TWO

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By Kristopher Klein
Staff Writer 

There is a new institution on the financial landscape. It includes five G7 member states and 26 regional member states and carries an endowment just under $100 billion. But there is one big issue that’s causing a stir—the United States refuses to participate even as its closest allies rush to join.

The rise of the China-backed Asia Infrastructure Investment Bank (AIIB) has fed the ‘American decline’ narrative popular among many news outlets. In the past weeks several notable American allies have agreed to join the bank. On March 12, the United Kingdom became the first US ally to announce that it would join the AIIB after originally deciding against membership. Several European countries, including Germany, France and Italy quickly followed. Two weeks later on March 26, South Korea announced that it too would join the AIIB. After three days, Australia and the Netherlands completed the humiliation. In light of these defections, the media remains transfixed to the unyielding opposition of the United States and its increasingly ‘isolated’ stance. When China first unveiled the AIIB, the United States used diplomatic pressure to prevent its allies from signing on to the new bank. However, those efforts failed in recent weeks after China agreed to scrap its veto power over the bank’s decision-making process in order to attract American allies. Despite the criticism directed towards the Obama administration, the strategy employed by the United States is not one of isolationism, nor has the United States been isolated. The United States is refusing to join the AIIB until China has solidified a system of decision-making that guarantees its actions are apolitical and responsible toward sustainable development.

The United States expressed great dissatisfaction when the United Kingdom joined the bank as its first Western member. According to a senior Obama administration official the United States remains “wary about a trend of constant accommodation of China, which is not the best way to engage a rising power.” The United States is concerned, and reasonably so, that the new bank will serve as a tool for the People’s Republic of China to challenge the established international system and the norms that exist within it.

America Is Not Being Isolated, It’s Being Wise.

China has a history of making loans to regimes that refuse to make the reforms necessary to secure a loan from traditional institutions such as the International Monetary Fund (IMF), World Bank or Asian Development Bank. In the decade from 1998 to 2008, during the worst of the genocide in Darfur, China gave the Sudanese government $1 billion in low or no interest ‘concessional’ loans. In 2004 shortly after Iran announced it would resume uranium enrichment, China agreed to invest $70 billion to develop Iran’s oil fields and to buy the oil they would produce over the next 30 years. Lending habits that place China on the side of abusive and reform-averse regimes have fueled concerns that the AIIB will not uphold existing international requirements to secure loans. In a statement to the UK’s Guardian newspaper, the National Security Council expressed concerns “about whether the AIIB will meet these high standards, particularly related to governance, and environmental and social safeguards.”

In spite of withering criticism, the United State’s decision to withhold support for the AIIB has its merits. It would be unwise for the United States to back an institution that allows China to wield outsized influence over decision-making, particularly when that decision-making could lead to politically, economically and environmentally irresponsible investments. The agreement by Chinese officials to forgo veto power was a step in the right direction. However, more concessions can yet be gained.

Allegations of a hidden Chinese agenda

Concerns that the AIIB will be used to further China’s political agenda were raised last week when China demanded that Taiwan only be admitted to the bank’s membership if it applied with an ‘appropriate’ name. Taiwan, referred to by China as “Taipei, China” and officially known as the Republic of China (ROC), has been in a near constant state of conflict with the mainland since 1949, when defeated Nationalist Chinese forces led by Chiang Kai-shek fled to the island following the Communist Party’s rise to power and the establishment of the People’s Republic of China (PRC). The use of Taiwan’s AIIB membership as a chance to bring up the issue of its sovereignty is not only incredibly dark, but indicative of China’s intentions to use its influence in the AIIB to pursue its own political agendas.

Furthermore, Beijing’s maneuvering of its own bank’s role as an alternative to the IMF, World Bank, and the ADB have led to concerns that contracts funded by AIIB investments might favor firms that support Chinese political positions. China must provide credible assurances, that it will not use the AIIB as a tool of its own power before the institution can be considered politically kosher around the globe.

Suggestions have been made to pressure China to address concerns that its new bank will be used as a political tool, but thus far, China has not acted to assuage such concerns. South Korea recommended moving the bank’s headquarters to Seoul in order to alleviate concerns over China’s political intentions. However, China insisted that the headquarters remain in Beijing. South Korea did not attend the signing of the original document laying out plans for the creation of the bank.

All the scrutiny focused on the rise of the AIIB places substantial pressure on China to facilitate a system that dispels these concerns. It is imperative for the survival of the AIIB that China establishes fair guidelines for the bank. If voting structure and day-to-day operations of the bank are seen as being skewed or unfair, all of the progress China has made toward establishing its own alternative institution will be done in vain.

What The United States Should Do

If the United States truly wants the AIIB to adopt standards used by existing international institutions, it must first show China that it is willing to be fair with rules and procedures. In 2010 the IMF proposed changes to its voting structure that would increase the voting power of developing countries by 2.6 percent and redistribute voting power among developing and developed countries from over-represented countries to under-represented countries. Among the countries to gain the most voting share from these reforms are China and India. Though this set of IMF reforms has received backing from the Obama administration, it has not been implemented due to resistance from the U.S. Congress, which must ratify any change in the US’s voting quota. If Congress were to ratify IMF reforms, it could turn the current narrative to focus on the structure of the AIIB and place additional pressure on China to endorse both equitable voting power and stricter standards for lending in the new bank.

The focus of the United States should not be on the maintenance of its own voting power alone, it should be on the improvement of lending standards that it helped create to bring greater efficiency and reform progress to the international financial system. In order for the current regime of international standards to survive, the United States must show a willingness to allow its role within that structure to evolve. The perfect way of sending that message would be to ratify IMF reforms, while continuing to pressure China into accepting existing norms. Until the AIIB can prove itself to be impartial and responsible, the United States should limit its interactions with the institution.

THE STRUGGLE FOR RIGHTS WITHIN UGANDA’S LGBT COMMUNITY: AN AMERICAN DEBATE RELOCATED

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by Andrew Muse-Fisher
Staff Writer

In late 2009, the Ugandan parliament introduced a bill that would allow life imprisonment of homosexuals, and in some instances, the death penalty. Though the bill expired after having been tabled for two years, the Ugandan parliament passed a similar bill in late 2013. [1] President Yoweri Museveni, after some hesitation, signed the bill into law in early 2014. [2] Though it may appear as if the president and parliament were just acting to meet the demands of the Ugandan majority, there is much more going on in the background. In the battle over LGBT rights in Uganda, those in favor of the bill have received support from American evangelical missionaries. On the other side of the debate, those against the bill have heard support from international groups and individuals, including U.S. President Barack Obama. Indeed, it appears that this is not simply Uganda’s fight, but also represents an international “spillover” effect from the ongoing debate over LGBT rights in the United States.

Prior to the Anti-Homosexuality Bill introduced in 2009, homosexuality was already illegal in Uganda. The point of the bill was to go one step further and make “aggravated homosexuality” punishable by death. [3] “Aggravated homosexuality” is defined as repeated homosexual behavior and/or homosexual behavior by people who are HIV positive. [4] To many, this came as an extreme addition to an already draconian set of laws. The law outlawing homosexuality had been in place for nearly a century, so the sudden necessity of a new law suggests it is politically motivated; the old law is still an effective discriminatory instrument. A window into those considerations might be found in the fact that Minister of Parliament David Bahati, before introducing the bill, attended a meeting with evangelicals from the United States who promote converting homosexuals to heterosexuality through prayer. [5] The timing was symbolic in that Bahati, when proposing the bill, chose to highlight a link between American evangelical influence and the bill, albeit indirectly.

American voices also spoke against the legislation. Both Obama and U.S. Secretary of State Hilary Clinton were quick to warn the Ugandan parliament against passing the bill. Furthermore, Congress reacted by passing a resolution to advise Uganda and other countries against taking such extreme action against the homosexual community. [6] If stern words from the American government were not enough to cause hesitation within the Ugandan leadership, others have raised the issue that the legislation might conflict with the African Growth and Opportunity Act, which allows participating countries to receive preferential access to U.S. markets. [7] It then became a question of whether or not Uganda wanted to risk its preferential economic status in order to further suppress the rights of homosexuals. Ultimately, those speaking against the legislation succeeded in suppressing the bill long enough so that it expired. This, however, did not prevent increased homophobia in the country, nor did it prevent the resurgence of the bill in 2013.

The Anti-Homosexuality Bill introduced in 2013 is very similar to the 2009 bill, though the punishment of execution was taken out, possibly in response to the outrage of international organizations. Despite the changes, the bill met similar opposition. [8] Secretary of State John Kerry compared the law to apartheid, while the World Bank withheld a $90 million loan that would have gone towards improving health in Uganda. [9] With these and other sanctions facing the nation, it would seem that the Ugandan parliament would have acted quickly to vote the bill down. This assumption seemed especially valid in light of a change of heart on the part of some of the American evangelicals. When the second version of the bill surfaced and gained traction, evangelical groups in the U.S. claimed they neither played a role in influencing the passing of the bill nor support its harsh punishments. [10] Not everyone abandoned their support for the old position: pastor Scott Lively for instance, who gained support for the bill in 2009 continued to openly support the bill. [11] At the same time, Bryan Fischer from the American Family Association mistakenly celebrated the passing of the bill in 2012 as a chance for the U.S. to do the same. [12] That is, Fischer saw Uganda’s progress against the LGBT community as an example of what the U.S. could achieve. With such contradicting opinions from evangelical groups, and international groups taking a strict stance against the bill, it is surprising that the bill passed in December of 2013. In the end, it was left to President Museveni to decide the fate of the bill. At first, he was hesitant because a quorum was not present when the vote on the bill occurred; eventually he agreed to sign the bill into law if he could be offered proof that homosexuality was not genetic. [13] After consulting a committee of scientists, Museveni signed the bill. He sent a letter to President Obama stating, “Their unanimous conclusion was that homosexuality, contrary to my earlier thinking, was behavioral and not genetic. It was learnt and could be unlearnt.” [14] The Anti-Homosexuality bill became law, yet neither parliament nor the Ugandan people offered any major opposition. Instead, the law seemed to reflect the will of the country’s Christian majority.

Uganda’s population is 85% Christian, which gives power to religious officials in shaping public opinion, especially on an issue concerning sexuality. [15] It is not surprising that religious beliefs openly overlap with politics and that a majority then is in favor of limiting the rights of homosexuals. It is quite possible the evangelicals used this to their advantage in supporting the bill. Evangelicals spread their message largely through broadcasting networks that air mostly religious programming. This programming is a mixture of moderate and more conservative belief structures that, to the audience, are nearly indistinguishable. Evangelicals use these and other networks to gain funds, which then go into social and religious programs as well as toward reinforcing the viewpoints of these groups. [16] This task is made easy by the fact that the majority is already Christian. Why would parliament or the president refuse passage of the bill when the Christian majority wants it? Lydia Boyd makes the argument that the people are not only in favor of the bill because of religious beliefs. Boyd states that it is also because of a Ugandan mentality that promotes respectability and limits freedom based on the idea that too much independence causes problems within society. [17] Though it is not clear whether it is religious beliefs or Ugandan mentality that is more prominent in shaping opinion against homosexuals, the two have enough overlap to help explain this common opinion. This opinion, regardless of the law, is a major factor in reducing the social acceptance of the homosexual community. When the law passed, a Ugandan tabloid responded by listing the names of 200 people it believed were homosexual. This caused Ugandans to act out violently against those listed, as well as other members of the Ugandan LGBT community. [18] Even when the 2009 version was tabled, some Ugandans denounced the homosexual community, declaring them sub-human, threats to children, and “un-African.” [19] These declarations testify to the fear and hate Ugandans directed towards homosexuals, the sentiment providing a reason for the bill itself, and its passage providing reassurance for the outraged. In passing the bill into law, parliament was only working to mitigate the fears of the majority of the people.

With the wants of the Ugandan people met, the question remains of the role of the United States in the debate over homosexuals in Uganda. Evangelical missionaries used religious and social values of the Ugandan people to promote and influence the passing of the bill, while the U.S. government appealed to Uganda’s existing trade agreements and need for aid. The fact that either of these groups played such a large role in Uganda’s debate is reminiscent of the debate over gay marriage in the U.S. The opposing sides are the same, but there are two main differences: the setting and the stakes. In the U.S., homosexuals were and are fighting for marriage equality. In Uganda, homosexuals were fighting to avoid life in prison. The outcomes, however, differ greatly. Before Uganda passed the Anti-Homosexuality bill, the U.S. Supreme Court struck down DOMA, moving in the exact opposite direction. Because of this, the U.S. has established a stronger platform to make similar advances on an international scale.

It is not unheard of that the United States has used the conflicts of other nations to promote its values, but it is still uncommon for the U.S. to take such a solid stance when LGBT rights are concerned. It was only relatively recently that Obama came out in favor of gay marriage and what’s more, Americans, regardless of political party, are increasingly likely to support marriage equality. The country is making steady progress to the extent that its message of equality is spilling beyond its borders. If the U.S. government keeps up its support for the LGBT community, its efforts, though against the will of the Ugandan people, may yet stand as a precedent to continue speaking out against countries that discriminate against and diminish the rights of LGBT communities.

Photo by Kaytee Riek

Notes

[1] Englander, Daniel. “Protecting the Human Rights of LGBT People in the Wake of Uganda’s Anti Homosexuality Bill, 2009.” Emory International Law Review. 25.3 (2011): 1263-1316.
[2] “New Anti-Homosexuality Laws Raise International Concerns.” Vax 12.2 (2014): 3.
[3] Ewins, Lucy Heenan. “Gross Violation: Why Uganda’s Anti-Homosexuality Act Threatens Its Trade Benefits with the United States.” Boston College International & Comparative Law Review 34.1 (2011): 147-171.
[4] Ibid.
[5] Ibid.
[6] Ibid.
[7] Ibid.
[8] “New Anti-Homosexuality Laws Raise International Concerns.” Vax 12.2 (2014): 3.
[9] Pulliam Bailey, Sarah. “Evangelical Leaders Decry Uganda’s Antigay Law.” Christian Century. 131.7 (2014): 16-17
[10] Ibid.
[11] “U.S. Evangelicals Played a Key Role in Uganda’s Notorious Anti-Gay Bill.” Church and State 67.4 (2014): 21
[12] Ibid.
[13] Dockerman, Eliana. “Ugandan President to Sign Anti-Homosexuality Bill.” Time.com (2014): 1
[14] “New Anti-Homosexuality Laws Raise International Concerns.” Vax 12.2 (2014): 3.
[15] “Listen, then Speak: Uganda’s Anti-Gay Bill is Making Cross-Cultural Relations More Complex than Ever.” Christianity Today 54.2 (2010): 53.
[16] Kaoma, Kanya. “How US Clergy Brought Hate to Uganda.” Gay & Lesbian Review Worldwide. 17.1 (2010): 20-23.
[17] Boyd, Lydia. “The Problem with Freedom: Homosexuality and Human Rights in Uganda.” Anthropological Quarterly 86.3 (2013): 697-724.
[18] “U.S. Evangelicals Played a Key Role in Uganda’s Notorious Anti-Gay Bill.” Church and State 67.4 (2014): 21
[19] Englander, Daniel. “Protecting the Human Rights of LGBT People in the Wake of Uganda’s Anti Homosexuality Bill, 2009.” Emory International Law Review. 25.3 (2011): 1263-1316.