A new report takes a critical look at the engagement of European development banks in Egypt after the popular uprisings in the Middle East and North African region. This article appeared originally on the Counter Balance blog and has been shortened and slightly edited.
The news circulated yesterday that Mikhail Beketov, a Russian journalist who campaigned against corrupt practices in connection to the planned highway construction through Khimki Forest, has died. This guest post by Mikhail Matveev and Ivan Smirnov, fellow Khimki activists, tells Beketov's story.
While it is not to be unexpected for the public to attempt to scrutinise the effective performance of governmental agencies, in recent years in Kazakhstan it has been far from obvious that many resources and services, projects and finances are being provided by international financial institutions (IFIs). Indeed, very often it is the IFIs that act as catalysts for various government programs, reforms and ideas that are subsequently adapted via the bureaucratic apparatus to Kazakhstan’s reality.
A $3.7 billion PPP oil refinery expansion in Cairo is accompanied by contradictory project documents, making a mockery of claims by the public banks involved to be committed to “good governance” or democracy. Despite being presented as merely translations of one document, the Arabic and English “versions” are entirely different – with the Arabic markedly cursory and superficial.
Although public-private partnerships appear to become increasingly untenable for public authorities, they are further being promoted by the European Commission and the European Investment Bank. An official in-depth evaluation of this financing model, however, is still nowhere to be seen.
Europe's anti-crisis measures include efforts to increase private investments in public infrastructure. Yet, a backlash against public-private partnerships in Portugal is a warning against putting too much faith in this approach.
A phenomenon that has become quite fashionable over the last decade or so among governments is the Public-Private-Partnership, or PPP. The UK started to introduce this model in the mid-1990s, and it is also a favoured option in Spain and Hungary. One of the many dangers is that it allows private companies who enter into partnership with government to funnel the profits into tax havens.
The figures should be well known. Somehow, though, in the western world, and especially in official quarters, they tend to get overlooked in the rush to impose the 'next latest thing' on post-revolution Egypt. The country's seven percent GDP growth figure in 2007, hailed by the World Bank and others, concealed a multitude of injustices. For one thing, average per capita GDP growth plummeted from 4.1 per cent prior to 1990 to 2.7 per cent during the neoliberal era set in motion by the IMF structural adjustment regime in 1991.
After a long gestation period the EBRD's new draft Municipal and Environmental Infrastructure (MEI) policy finally appeared in April, bringing some good news such as the bank's commitment to start monitoring some on the ground project impacts and sustainability rather than just market-related transition impacts.