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Human Misery monetized

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While the new cold war is taking its momentum, the world community is gradually forgetting other pressing issues; such as human rights, right to labor, human dignity and respect. Of course, the national and international corporations hereby play a major role when comes to respect and observance of social and labour rights. Even at the Geneva-based world standard-setting organization, that of ILO (International Labor Organization), corporation have a strong say.

What is the degree of due diligence deployed by corporations today? Does the corporate world comply with the law and standards of business conduct, transparency of business operations? And – importantly – does the private sector respect standards of international humanitarian law, especially in situations of armed conflicts and the so-called forgotten conflicts? Places where open hostilities have ceased, but yet peace has never really come. Notably, does the corporate world comply with the set of important international standards such as the UN Guiding Principles on Business and Human Rights or the OECD Guidelines for multinational corporations, to name just a few? Could we go as far as to claim that in some cases the private corporate entities play a decisive role in funding, enabling and facilitating permanent changes in economic, demographic and cultural character of the occupied territories? And if so, does it serve, to say, dual purpose: a corporate gain and a prolongation of the occupation on the given territory?

To understand the gravity of that problem, let’ take as an example conditions in Caucasus – a typical case of the forgotten conflict – region where war stopped, still peace has never arrived.

Armenian companies, as well as foreign (mostly diaspora controlled, such as the Lebanon-based Artsakh Roots Investment; the US-based Tufenkian Foundation; Armenian General Benevolent Union /AGBU/; Cherchian Family Foundation, etc.) businesses play a decisive role in funding, enabling and facilitating permanent changes in economic (including fiscal and monetary), demographic and cultural character of the occupied territories both for private gain and for supporting the prolongation of the occupation of these territories.

Over the past years, the well-orchestrated transfer of Armenian settlers from Armenia and elsewhere into the contested territories (via e.g. Hayastan All-Armenian Fund), including the areas adjacent to Nagorno-Karabakh, in particular the districts of Lachyn, Kalbajar, Gubadly, Zangilan and Jabrayil, has continued with accelerated pace.

To worsen the things, fishing of the human souls exploits an epic human tragedy of Syria and its people: The shadowy Armenian Revolutionary Federation (ARF) is deceiving Syrian Armenians with an instant-better life promise if they relocate from e.g. Qamishli and Aleppo cities in Syria to Caucasus and its occupied territories (e.g. Zangilan, Gubadly and Lachyn districts). Nearly a mass-manipulation replica of the famous call to Bosnian Croatians from Zagreb to settle the former Serb inhabited and ethnically cleansed territories of Croatia. This is of course, a direct criminal meddling into the domestic matters of two sovereign states.

Armenia, directly or via its corporate proxies, continues permanent energy, agriculture, social, residential and transport infrastructure changes in the occupied territories. This is increased and prioritized as to change the demographic character once for good: That of course includes the construction of irrigation networks, water-canalization, roads, power-grids and other vital economic and social facilities. (Several international reports, conducted independently by different FORAs, repeatedly confirmed that property of IDPs has been appropriated. E.g. that empty houses of Azerbaijani internally displaced persons were often dismantled for use as construction materials or that new houses are being built on their lands and properties.)

Armenia exercises pervasive control over the entire economic and commercial system in the contested territories, including inbound and outbound trade flows and economic resources. Tacit presence of the international companies is rather interesting: there are hundreds of various types of US-manufactured Caterpillar machines, farm tractors and equipment of US-based John Deere and Germany’s Deutz-Fahr companies, South Korean Hyundai trucks, Belarus MT3-82,3 model farm tractors, as well as other heavy machinery for illegal mining, agriculture, expansion of settlements and construction of the supporting infrastructure. The true ownership for most of those companies remains unclear, as oftentimes registered offshore in Cyprus, Liechtenstein and the like.

Often their funding is channeled through the branches of Armenian banks operating in the occupied territories and conducting international financial transactions via intermediary banks in Russia, EU and elsewhere. Further on, a numerous foreign retailers, from Ukraine, the US and the EU states (particularly from France, Bulgaria, Hungary, Belgium, Germany, the Czech Republic, the Netherlands), as well as from Australia and UAE, have concluded their supply contracts with Armenian companies. That, of course, makes them complicit with Armenia’s occupation of the territories, drain of resources, expansion of illegal settlements as well as with a violation of fundamental rights of IDPs.

Little wonder, since Armenia’s high-ranking officials, including President Sargsyan, PM Abrahamyan and other ministers, routinely visit the occupied territories and inspect production facilities there. To camouflage the illegal nature of production there, Armenian agricultural and liquors export companies (e.g. “Stepanakert Brandy Factory” and “Artsakh Fruit CJSC”) routinely mislabel the products wholly or partially produced or packed in the occupied territories as originating from Armenia, thus misleading governments, international retailers and consumers.

The agricultural lands in the contested territories along the Araz River (Zangilan and Jabrayil districts, too) have been illegally appropriated and extensively exploited by Armenia. This poses a stress on natural water flows (for consummation, irrigation or opportunity for an illegal electricity generation) and soil (overuse of arable lands and monoculture cropping) – which, in return, alters micro climate and jeopardizes the biota and human existence (e.g. Armenia’s Arm Water Project Company Ltd. in the Araz Valley).

Dismantling of infrastructure (metals, pipes, bricks and other construction materials) from the ruins of demolished Azerbaijani households and public buildings was previously conducted more sporadic. However, the currently examined cases show that it becomes more organized system of pillage with a clear foreign involvement.

Mining of the precious minerals and metals is one of the main enterprises in the occupied territories. E.g. Gyzylbulag underground copper-gold mine (wholly owned subsidiary of Armenia’s Vallex Group CJSC, registered in Liechtenstein), led to its almost complete depletion. Similar faith is of Demirli open-pit copper and molybdenum mine. In 2014, Gold Star CJSC reportedly started exploitation of gold near Vejnali village (occupied Zangilan district of Azerbaijan). Since 2007, GPM Gold, a subsidiary of Russia-based GeoProMining Ltd., has been extracting ore in Soyudlu gold mine in the occupied Kalbajar district.

There is an illegal traffic in natural resources across the occupied section of the international border between Azerbaijan and Armenia that is controlled by the armed forces of Armenia via Armenia constructed Vardenis-Aghdara highway. The Government of Armenia, via its Energy Ministry, is directly operating: The ore concentrate from Gyzylbulag is transported to Armenia, where it is further processed into gold containing copper and exported to international markets, mainly to Europe. Armenia is also extracting coal from the mine near Chardagly village in the occupied part of the Tartar district to supply the power plant in Yerevan, Armenia.

There is a clear correlation between the business and the political status quo. Hence, it is safe to conclude that the prolong occupation directly translates into more mineral, agricultural, water resources and other wealth for the neighboring government and gloomy international business. Demographic engineering is a key here, and is – of course – done by conflicting the fundamental human rights and norms of humanitarian law, including those of IDPs.

In its epilogue, a clandestine population-reshuffle coupled with illegal economic activities on the contested territories produces the notorious “blood diamonds”: socio-political status-quo, demographic inversion, and extension of the armed conflict.

Is there anything larger than a problem of such a huge gravity for the resident population?

Of course, there is. Our silence about it !

Eastern Europe

The phenomenon of the Islamic world- Ilham Aliyev

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At the end of the twentieth century – at the beginning of the 21st century, world politics differ by its complexity and diversity. It is too important that Azerbaijan, which proclaimed independence twice during the twentieth century, maintained its this independence during the period full of globalization, international integration and social contradictions. Under such complicated historical circumstances, the prominent politician and statesman, the well-known and respected person in the world – Ilham Aliyev’s commitment and successful realization of this responsibility can be characterized as the golden age of modern Azerbaijan history. Conduction of successful foreign policy during his term as head of state has had a significant impact on the future life of Azerbaijan.

The Republic of Azerbaijan, established normal international relations with all the countries of the world after gaining independence, and in the frame of good relations with the Muslim countries, it also protects the interests and interests of the Islamic world within the Organization of Islamic Cooperation and continues to cooperate with these countries in accordance with the requirements of international law. In this regard, strengthening of Islamic solidarity in the world is one of the priority issues in the foreign policy of Azerbaijan. Namely from this point of view, declaration of 2017 year as “Islamic Solidarity Year” by decree of the  President Ilham Aliyev dated January 10, 2017, is an indicator of  humanistness of our state leader and at the same time it is a positive example of our country’s sensitive attitude to the Islamic Countries Union. Islamic solidarity does not only mean the solidarity of Islamic countries. This is a kind of challenge, regardless of religion, to the world’s people to live in friendship, brotherhood and multiculturalism conditions.

It is well known that sectarian wars, civil wars in the Middle East and as a result, emerged certain socio-political tensions indicate that Muslim countries are in great need of moral solidarity. The controversial political processes happening in the world, the emergence and increasingly widespread of warlike states in different countries, the strengthening of religious confrontation, and the deepening of the prejudiced attitude towards Muslims emphasize the necessity level for solidarity among people, nations and states. It can be said that one of the main reasons for exacerbating the myth of Islamic terrorism, the threat of Islamophobia, and strengthening the oppression of Islamic countries should be sought in the absence of unity and solidarity among these countries. Faith differences, contradictions in interests and positions and etc. leads to serious disagreements, and sometimes severe confrontations. Islamic religion, its sacred values, are insulted by the Islamophobia and those who are exposed to the poisonous propaganda against Islam. The bloody events that took place in the Islamic countries during last years, especially in Iraq, Bahrain, Yemen, and Syria are confirmation of our opinions. Cradles of ancient Eastern culture such as Baghdad, Damascus, Aleppo, Kirkuk, Basra and other cities are subject to serious destruction as a result of wars in Iraq and Syria and constant clashes, monuments of Islamic culture in these cities are destroyed. Caricatures of the Prophet Muhammad are given in the Western media, mosques, the holy book-Koran is burnt. The Western world’s official structures do not just condemn the acts of vandalism, but on the contrary, they protect, honor, and appreciate the performers of those acts.

The main purpose of the “Islamic Solidarity Year” is to strengthen the unity of the Muslim world and to show that Islam is a religion of peace and culture, and to achieve this goal, as President of the Republic of Azerbaijan Ilham Aliyev said, first of all, reconciliation between different sects that have historically damaged Islam should be established. The announcement of the year 2017 as the “Year of Islamic Solidarity” in Azerbaijan is a challenge to the West, which is strengthening its attacks on the Islamic world annually and promoting a new “crusades” in the 21st century. This is also a call for Islamic countries to be vigilant against the crafty intentions of the West, to demonstrate unity and solidarity. Ilham Aliyev made this important step and expressed the his own position and the position of the state of Azerbaijan. As Azerbaijan has distinguished from other states with its multicultural and tolerant values throughout its history. Islamic solidarity is also a part of this context, and this shows that President Ilham Aliyev gives great importance to the solidarity of the Islamic world. As political scientists point out, some initiatives have been made to call Muslim countries to get unified around religion. For the first time in history, the head of our state has sent a political message to the Islamic world, pointing to the importance of acting from unified position, to achieve unity and at the same time integrate into the world. It should be noted that the Order of the President of the Republic of Azerbaijan on the declaration of 2017 year as“Year of Islamic Solidarity” states: “The Republic of Azerbaijan has established mutually beneficial relations with the Islamic world by being selected as a member of the Organization of Islamic Cooperation, ISESCO and other respected organizations joining muslim countries and has been an organizer of a number of important cultural forums of global importance. Azerbaijan has made a great contribution to the founding of tolerance environment, multiculturalism, intercultural and intercivilizational dialogue, and the promotion of Islamic values in the world. The prestige gained by Azerbaijan in the Islamic world got its expression in this results that Baku and Nakhchivan cities declared as a capital of Islamic culture in 2009 and 2018 respectively. And the decision to hold the IV Islam Solidarity Games in Baku in 2017  create favorable conditions for our country to take the next practical steps in strengthening the Islamic solidarity. ”

Only state leader of the country like Azerbaijan,  where multiculturalism and solidarity are established, and citizens of different nationalities, religions and sects live in peace, has a moral right to give such a decree. The promotion of the Islamic Solidarity initiative is related to the challenges of the present and controversial processes that take place because of various reasons in the Islamic world. As it is seen here, the importance of Azerbaijan’s reputation in the Islamic world, as well as the need to strengthen the solidarity of Islamic countries, as well as the actuality of holding the Islamic Solidarity Games in Baku, the capital of the Republic of Azerbaijan in 2017, have been extensively and logically expressed in this decree. With Islamic solidarity policy, Azerbaijan, as unifying facility of the Islamic world, confirms that these religious values are indeed, humanistic, moral values and reinforces belief to being of these ideas are an effective means of creating a shared living and stability environment not only in the Islamic geography but also in the entire world. Azerbaijan, which has created a partnership of cultures and ideas between East and West, fulfills the function of a of solidarity bridge, thus demonstrates its commitment to universal values, as well as its commitment to the highest values of the Islamic religion, which had a special place in the past and continuing to keep its value today. Thus, Azerbaijan uses all the means to establish steady stability in a globalizing world and propagates the peacekeeping, reconciliatory position in a unique way that is essential for today.

We suppose that this humanist initiative of the President of Azerbaijan, Mr. Ilham Aliyev, will promote the expansion of cooperation relationship between Muslim countries in the world and further strengthening of the Islamic solidarity. The strengthening of Islamic solidarity, in its turn, will play an important role in ensuring tranquility and peace in the Middle East and other regions.

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Eastern Europe

Economic Growth of Ukraine Depends on Completing Pending Reforms Quickly

MD Staff

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Ukraine’s economy grew by 2.5 percent in 2017, the second year of modest growth, according to the World Bank’s latest Ukraine Economic Update.  Growth in manufacturing, services, and construction was robust, but weaknesses in the agriculture and mining sectors, together with delays in key reforms to further strengthen investor confidence contributed to the modest overall growth performance.

“Faster growth is needed to improve living standards for the people of Ukraine who continue to hurt from the economic crisis of 2014-2015,” said Satu Kahkonen, World Bank Country Director for Belarus, Moldova and Ukraine. “This will require decisive measures in the next few months to complete pending reforms to bolster investor confidence and safeguard macroeconomic stability.”

Economic growth is projected at 3.5 percent in 2018 if pending reforms in anticorruption, land markets, state-owned banks, and privatization can be advanced in the next few months. This would provide an important signal to investors. If reforms are delayed, growth could drop below current levels in an uncertain macroeconomic environment as financing risks rapidly increase.

Ukraine faces major financing needs to repay public debt and fiscal pressures from higher public sector wages and social benefits in 2018 and 2019. Mobilizing adequate international financing by completing pending reforms in the months ahead will be important to maintain macroeconomic stability.

Meeting the fiscal deficit target of 2.5 percent of GDP in 2018 will require improving targeting of housing utility subsidies, making further wage increases contingent on measures to optimize the school and hospital network and public-sector staffing, and identifying affordable options to update public sector pensions.

Fiscal Pressures and Reform Options …

According to the World Bank’s Special Focus Note on fiscal pressures and reform options, Ukraine has made progress in reducing its large public spending since 2014. However, sustaining these gains while also improving the effectiveness of public services will require implementation of reforms in education, health, public administration, pensions, and social assistance in a fiscally affordable manner.

Public expenditures increased significantly in 2017, by 11.7 percent in real terms, reaching 41.5 percent of GDP, due to the doubling of the minimum wage and over 40 percent increase in wages of teachers and doctors. Spending on social programs also increased.

The recently adopted reforms in education, health, and public administration seek to improve compensation for teachers, doctors, and public servants to strengthen incentives and attract quality personnel. Achieving this in a fiscally affordable manner will require coordinating further increases in salaries with time-bound measures to optimize staffing and the school and hospital network.

The social assistance package in Ukraine is not only fiscally costly—costing 5 percent of GDP in 2017, but is also poorly targeted—with only 30 percent of assistance going to the bottom 20 percent of the population. Fixing this will require improved targeting of the large HUS program.

The recently adopted pension reform helped improve adequacy of benefits and stabilize fiscal costs. Additional initiatives going forward should avoid undermining these core objectives of the pension system. The timeline to create a funded pillar system by January 2019 needs to be reconsidered since this will undermine contributions to the pay-as-you-go system, create contingent fiscal liabilities, and face inadequate availability financial instruments.

Background

Since May 2014, the World Bank Group has provided a total of more than US$5 billion to Ukraine (including 4 development policy loans, 7 investment operations and 1 guarantee) from the International Bank for Reconstruction and Development (IBRD).

The World Bank’s current investment project portfolio in Ukraine amounts to US$2.5 billion.  Investments support improving basic public services that directly benefit ordinary people in areas such as water supply, sanitation, heating, power, roads, social protection and healthcare, as well as private sector development. Since Ukraine joined the World Bank in 1992, the Bank’s commitments to the country have totaled over US$12 billion in about 70 projects and programs.

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Eastern Europe

Baltic States: Missed opportunities in global politics

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We are living in the world where the facts “who makes” and “where it is made” are much more important than “what for” issue. Nowadays the world political scene is divided between superpowers supported by their allies. In order to punish each other for having opposite views the sides criticize any step made by the opponent.

Unfortunately, this happens even in case of evident necessity. It is not the secret that the modern system of international security is unable to perform all demanded functions any more. It needs to be reformed. Another question is who and where will decide.

The most likely political platforms for this are the United Nation Organization and OSCE. But the preparatory stage for any new decision should become different forums and conferences, such as the Munich Security Conference and the Moscow International Conference on Security.

This year the Munich Security Conference took place on February 16-18. More than 30 heads of state and government and over 100 cabinet ministers from across the globe came together at the forum for discussions on major international security challenges. As far as the Baltic States concerns, President of Estonia, as well as Lithuanian and Latvian ministers of defence did not miss the event because it was of great importance for the future of their countries and all Europe.

Just another situation developed in March. In Moscow an annual International Conference on Security was held on April 4-5. The fight against terrorism and other pressing security challenges were one the agenda. There is not a single person who is not affected by the discussed topics.

Many European countries considered it unnecessary to visit the event. It makes no sense to blame them for this choice. They have a strong and common view on what is happening in the world. But if abstract from the current geopolitical situation and confrontation between Russia and the West, politicians should see such kind of forums as a chance to find even weak possibilities to make the world safer. Probably the main reason for not attending the event is in the fact that politicians forgot how to listen to each other. They forgot that only discussing controversial issues makes possible to reach a consensus.
Another issue that deserves attention is the list of participants, which is of great interest to the analysts. According to the Russia’s Defense Ministry, representatives from at least 95 countries, three deputy prime ministers, 30 defense ministers, 15 chiefs of staff, 10 international organizations and military delegations have come to participate in the International Conference on Security. They include defense ministers of India, South Africa, Iran, Iraq, Pakistan, Vietnam, Azerbaijan, Belarus, China, Armenia, Mozambique, Serbia, and Israel. Thus, almost half of the UN member-states (total number is 193) sent representatives to the Conference.

It becomes evident that Russia really has powerful partners and allies that are ready to discuss even difficult questions and find mutually beneficial solutions. Those who came do not necessarily agree with Moscow and support its foreign policy but they clearly understand that unfortunately without Russia it is impossible to improve the International Security system.

This fact admitted Thomas Greminger, secretary-general for the Organization for Security and Co-operation in Europe. He stressed that Russia is a key partner in issues of the European security. But the Baltic States blinded by hatred to Russia ignore ignored the event thus putting political ambitions higher than common sense.

It is obvious that Russia is not satisfied with NATO’s actions near its borders. NATO in its turn disputes the lawfulness of Russia’s behavior. Every day confrontation becomes harder and leads to the arms race. The only way out is to discuss things and find the way out. The Baltic States as usual lost the possibility to express their position on key international security issues and be the active actors in global politics.

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