27 October 2008

First an East African update. In early August Burundi introduced an overnight export ban on raw hides and skins with the provision that anyone who builds a tannery will get an export license. The Burundi Ministry of Industry guaranteed only one year ago that it would not repeat the same Rwandan mistake! So much for promises and verbal guarantees but East African countries are notorious for that and recognised as less than reliable up to the inner circles of the EU in Brussels. So in Burundi we now have the same situation as in Rwanda, for exactly the same reasons. The tannery in Burundi was formerly owned by a European company and could theoretically transform all domestic raw hides and skins. It was forced to close in the 1990s due to lack of raw materials. Hence this export ban could secure supplies for the tannery if able to process the available supply. However, like in Rwanda, the local tannery is (as yet) not capable of transforming the available quantity of raw hides and skins. Hence smugglers will have a great time. The sector strategy of these countries makes one wonder where they get their advice from and how much money changes hands in order to get these strategies approved?

During the G8 conference in Japan, the world’s eight most industrialised countries announced that they had agreed to a 50% reduction of atmospheric pollution by 2050. Even if time flies, 2050 is far away and I won’t be around to check.
In a demonstration of democracy G8 also invited Brazil, China and India, recognising those countries that have industrialised tremendously during the last thirty or so years and can, therefore, no longer be considered ‘third world’ or ‘underdeveloped’. All three countries are contributing to a very large extent to global pollution. It is good to remind ourselves that these countries have benefited from massive financial and political help from the West, part of which enabled them to build strategic nuclear capabilities. It is true that in colonial times these countries were robbed blind but the West has paid for this over and again and is still paying in many ways. We invented the General System of Preference which allows entry of processed commodities into the industrialised world without being burdened by an import tax, whereas the same countries were allowed to levy an import tax on Western produced goods. A large number of countries, India, Brazil and China included, levy an export tax on raw materials. We have transferred technology and we have transferred production.
In the leather sector the industrialists in developed countries thought they were clever and ducked the severe effluent laws by doing all the dirty work in developing countries which did not have effluent laws and thus no effluent treatment costs. The developing countries were happy because this created jobs but most of all this created wealth. In fact tanneries in India produce more leather than all of Europe together. This production transfer created also massive pollution and not only in the leather industry. At first everybody was happy and pollution was not an issue. Now it is, and all governments have taken serious and important steps to curb pollution.
Twenty-five or thirty years ago, combating pollution was considered an expensive burden. Now our way of thinking has changed and we are about pollution and accept the costs involved in reducing it. The developed world has achieved a lot. In Germany the Ruhrgebiet, the heart of the country’s heavy industry, was in a similar condition 30-40 years ago to Beijing now. You could hardly see the next block due to the smog. Germany cleaned up its act. So has the whole developed world with only the USA lagging behind because of their sacred bottom line, which does not allow for environmental sacrifices, particularly in an election year. If the US people have started to drive more fuel-efficient cars it is because the petrol price went up, not because they pollute less…. In general however, our mentality has changed over the years. We have smoking bans because we understand that smoking, apart from being dangerous for one’s health, is also an offensive habit to those who don’t smoke. In short we look around ourselves rather than just ahead. Gradually the environment is helped by important new laws, which were unthinkable ten years ago. We know that what pollutes Chinese rivers today will, after some time, pollute the seas 10,000 km away, where we catch our fish. Pollution is not a local problem but a global problem. The radioactive cloud from the Chernobyl accident did not stop at the Ukrainian borders. It went around the globe many times.
We must keep a vigilant eye on what’s going on in other parts of the world and what we see is that ex developing countries are polluting even if, in all fairness, all of them are trying to curb pollution as much as possible, though not willing to make sacrifices in order not to slow down their economies. That’s why India, Brazil, China and others were invited to the G8 conference in Tokyo. I can’t understand why they are not willing to join the G8 anti-pollution recommendations and make the planet a better place to live. Do we have to pay again? Is only the west supposed to make sacrifices and come up (again) with funds to finance effluent plants in developing countries, which take decades to develop and build?
Authorities in Bangladesh, Egypt, Syria and several others have been deciding for years to close existing heavily polluting tannery clusters in their countries and shift the tanneries to newly designated industrial areas. But it’s all talk. No effective action is being taken. Nevertheless the West buys the leather and leathergoods produced in these areas without sanctions, on the contrary, with subsidies in favour of the exporters. That means that the governments in question are in no hurry to clean up their act or, better, the pollution. In present circumstances, therefore, nothing changes for developed developing countries whether they pollute or don’t pollute. Whether they adhere to G8 or not. The developed world pours billions into the developing world. Let’s ask for something in return and not just cheap leather products that kill our homegrown industries.
What I propose is that imports from countries that do not subscribe to the Kyoto Protocol and subsequent amendments should be burdened with an eco tax, which should cover the difference in price between an ecologically responsible manufactured product and the same or similar product without environmental provisions. It will reduce the unfair price difference, and make the product less competitive, hence reduce production and thus pollution. Once pollution is brought under control, then the tax should be reduced in the same proportion as pollution is reduced.
Sam Setter
[email protected]

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