First World Greed and a Fourth World Debt | Nigeria, IMF and Neocolonialism

12.1.12

“The big bankers of the world, whopractise the terrorism of money, are more powerful than kings andfield marshals, even more than the Pope of Rome himself. They neverdirty their hands. They kill no-one: they limit themselves toapplauding the show.”― Eduardo Hughes Galeano

Nigeria,the 5th top exporter of crude oil with 2.4m barrels produced a day(2007 figures), cutits state fuel grant to its citizens overnight.On January 9th, a nationwide strike commenced in Nigeria to reinstatethe fuel subsidy, followed by series of daily protests in which 2civilians were killed today (Jan 10). The subsidy cut had beendebated for the past 2 months but despite the very vocal oppositionfrom the people, the government went ahead and announced its removalon, of all days, the first day of 2012.

Now,the current case in Nigeria, as all socio-economic crisis's, containexternal factors. The ruling external factor here, as in mostcountries in the Global South (or the 'thirdworld', a filthy term which generates the feeling that they,arenot like 'us'),is called neocolonialism.Though Nigerian President Goodluck Jonathan asserted that the cut thewill allow infrastructure and social development programmes toflourish with the $4-8 billion saved, this appoints the very questionof then why Nigeria, containing the tremendous wealth of 2.4 millionbarrels of crude oil production a day, has barely any infrastructureand stable electricity in the first place. What is even more alarmingis the fact that Nigeria with such resources, must invest £4.2bnannually in their refineries, because Nigeria believe it or not, hasto import oil. Like bringing sand to the desert.

Priorto oil production, which surged after the 1970s, agriculturalproduction was the largest export sector for Nigeria. After thecountry became a largely oil-intensive economy, the agriculturesector took a back seat, giving the front seat, to The Bretton Woodsinstitutions; the International Monetary Fund (IMF) and World Bank.Herein, is where the problem begins.

TheIMF is made up from its 185 member countries,each of whom contributions quota of resources to the organisation inproportion to their economy, which in definition determines theirpercentage of voting rights and the amount of resources to which theycan have automatic access. A one dollar one vote system if you will.The U.S as would be expected, is the largest shareholder of 18%.Germany, Japan, France, U.K and the US combined, control about 38%.The way this all ties in with Wall Street is well, the interests ofbankers, investors and corporations from industrialized countries areessentially put above the needs of the world's poverty stricken,working class majority. Including their own countries.

Sincethe debt crisis of the 1980's, the IMF has assumed the role of'bailing' out countries with collapsing economies with its emergencyloans. But of course, like all business contracts, in order fora country to receive the crippling hand of the IMF, there are termsand conditions which appear as new policy reforms in the given state.In essence, it is a global financial mafia. Usually, when youfail a payment to a loan shark they break a leg and a few ribs. Failan IMF or World Bank payment, they will virtually gut your entireeconomy or send over US special forces to exact their gallon ofblood from your whole population.

TheWorld Bank works a little different but nevertheless is IMF'sbrother. It started off as the International Bank for Reconstructionin post war Europe as well as development in the rest of the world.It is mainly for development, such as assisting infrastructure,transportation, education and so forth. The World Bank resources, asopposed to the IMF, come from its issue of bonds in the capitalmarkets. These bonds are backed up by guarantees provided by thegovernments who belong to the institution. Already, it is obviousthat it is a more complex system with internal affiliates, such asthe International Development Assosciation (IDA), InternationalFinance Corporation (IFC), and the Multilateral Guarantee Agency(MIGA). World Bank assistance again, comes with strings attachedregarding the economy, however the IMF is essentially the debtornations financial advisor. The IMF isn't the primary a lendinginstitution as is the Bank, though it may seem as such. It is firstand foremost an overseer of its members' monetary and exchange ratepolicies and a 'guards' of the code of conduct. The World Bank, ismore of a fund, and the IMF is more of a bank.

TheWorld bank and IMF in reality are economic hit men for the formercolonial powers who operate the business of institutionalneoliberal colonialism.TheIMF and the World Bank, provides loans knowing full well they possessthe required military power (say from the US, UK, France..) to havethe debtors pay their loans, but the loans and their conditions areso extortionate and immobilising, they know the money will not bepaid off. As a matter of fact, theydon't want the loans paid off.What they want, what they need, is the pearl in the shell. What theywant is the debtor nation to open up their country’s naturalresources to be plundered by foreign banks and multi-nationalcorporations (as done in Nigeria, Argentina, Kenya, Mexico andcountless others)which are in bed with the IMF and World Bank.

Nowthe conditions are in fact 'structural adjustment policies' (SAPs).These allegedly are designed to ensure debt repayment and are more orless immediate measures to reduce inflation, government expenditure,and government deregulation to: privatise national assets; cutspending on education and health; eliminate basic food andtransportation subsidies; devalue national currencies to make exportscheaper; in other words, the installation of neo-liberal policies. InMexico for example, when the debt crisis hit in the mid-1980's andMexico announced it was unable to repay loans in 1982, the IMF andWorld Bank were already at the door. The primary policies that wereintroduced were reduced public spending, privatisation of moststate-owned enterprises, trade liberalisation and the removal ofbarriers to foreign investment. The World Bank suggested thatprivatising certain health services could provide a solution to thisproblem. However, the majority of Mexican citizens could not evenbegin to afford any type of private healthcare, and in respectnutritional deficiencies tripled infant mortality rates in the1980's. In 1994, Mexico was plunged into an economic crisisafter a rapid devaluation of the peso. The main factor that led tothis crisis, was the massive amount of debt built up as a result ofpractices brought about by SAPs such as; the liberalised financialsector; which included freed lending/borrowing rates, as well as theelimination of banks’ reserve requirements. Banks were hastilyprivatized, oftentimes without proper regard as to the newshareholders and/or bank officials. And so today, Mexicocurrently owes the greatest amount of loan,leading the debtor league at number one, closely followed by Greeceand Iceland.

"Brillianttheorists of economics do not find it worthwhile to spend timediscussing issues of poverty and hunger. They believe that these willbe resolved when general economic prosperity increases. Theseeconomists spend all their talents detailing the process ofdevelopment and prosperity, but rarely reflect on the origin anddevelopment of poverty and hunger. A a result, poverty continues.” ―Muhammad Yunus

TheIMF and World Bank have to deconstruct agriculture andindustrial production, basically any sector which are the componentsof a self-sustaining economy, and focus on exportinduced growth instead. Alsoknown as, 'cashcrops': grownfor money than for food. Take Kenya's green beans for instance. It isonly produced to be exported to Europe, majority of its cultivatedland is used to produce one type of crop as a commodity to be sold atforced low prices (set by the Global North of course), and inevitablyending up with nothing to eat. So what can they do? They import food(at a high cost). Now an estimated 2.4 million of Kenyans face foodinsecurity for 2012. Nigeria has to import oil. Uganda has to importfood. Iraq has to import dates. Haiti has to import rice (despitehaving 200 years of rice agriculture as the US forced its marketopen). This is the dependency effect.Yes, the IMF and World Bank, are the white masters on the field, andthis time they don't even need a whip.

Maybeyou have already noticed that the countries mentioned in this articleare all former colonies of the European empire. With classicalcolonialism taking a dip throughout the Global South, faced withresistance in the ex-colonial territories in Asia, Africa, theCaribbean and Latin America, imperialism simply switches tactics. They ‘grant’ independence to its former subjects, to befollowed by ‘aid’ for their development. Under cover of suchphrases, however, it devises innumerable ways to accomplishobjectives formerly achieved by naked colonialism. It is this sumtotal of these modern attempts to perpetuate colonialism while at thesame time talking about ‘freedom’, which has come to be knownas neo-colonialism. Themethods of neo-colonialists are subtle and varied. They operate inthe political, religious, ideological and cultural spheres, and I'veonly just about scratched the surface of the economic sphere.

Debtornations suffocate its people for loans they did not agree to take,just as the people of the nations granting the loan, did not agree togive. Why? Because the IMF and World Bank are accountable to nobody,though our tax is the foundation of their existence. First worldgreed, and a fourth world debt.

“Ispent 33 years and four months in active military service and duringthat period I spent most of my time as a high class muscle man forBig Business, for Wall Street and the bankers. In short, I was aracketeer, a gangster for capitalism. I helped make Mexico andespecially Tampico safe for American oil interests in 1914. I helpedmake Haiti and Cuba a decent place for the National City Bank boys tocollect revenues in. I helped in the raping of half a dozen CentralAmerican republics for the benefit of Wall Street. I helped purifyNicaragua for the International Banking House of Brown Brothers in1902-1912. I brought light to the Dominican Republic for the Americansugar interests in 1916. I helped make Honduras right for theAmerican fruit companies in 1903. In China in 1927 I helped see to itthat Standard Oil went on its way unmolested. Looking back on it, Imight have given Al Capone a few hints. The best he could do was tooperate his racket in three districts. I operated on threecontinents.” ― Smedley D. Butler, Waris a Racket: The Anti-War Classic by America's Most Decorated General

Labels: Africa, American colonialism, IMF, iraq, liberalism, Mexico, neo colonialism, Nigeria, oil, World Bank

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Dispatch: Aboriginal Press Media Group | Permalink | [12.1.12] | 0 comments

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