WTO Reform: Repercussions For Small Island States by STAR Publishing

THE STAR Businessweek JANUARY 26, 2019

www.stluciastar.com

WTO Reform: Repercussions for small island states As the WTO ponders reform, Caribbean states re-examine their role in the global trading body By Catherine Morris, STAR Businessweek Correspondent

More than 20 years since it was first created to facilitate global multilateral trade, the World Trade Organization (WTO) is in crisis. Calls for reform have been loud and widespread, with President Trump’s protectionist administration the biggest proponent of change. In summer 2018, the bombastic US President threatened to withdraw the United States from the trade body “if they don’t shape up” and pressure has been mounting ever since with the major members slinging insults and accusations back and forth. The recent round of US tariffs, which violate WTO rules, angered China and the European Union while the US blasted Beijing’s shuttered economy and “unfair competitive practices”.

Russia: Vladimir Putin’s pivot to Africa As protests raged in Zimbabwe’s cities last week, with police firing live ammunition at crowds who barricaded roads with burning tyres, the target of their anger was 8,000km away.

President Emmerson Mnangagwa, who had sparked the unrest by raising fuel prices amid an economic crisis in the southern African country, was instead strolling through the Kremlin for talks with President Vladimir Putin, the first of what Moscow hopes will be many visits by African leaders this year.

Continued on page 4

Pages 3 & 7

US President Donald Trump

Alrosa workers cut gems in Moscow. The Kremlincontrolled diamond miner plans to enter Zimbabwe, and already has assets in Angola and Botswana © Bloomberg

The star businessweek

JANUARY 26, 2019

www.stluciastar.com

Jair Bolsonaro’s Ascent: a Fork in the Road for Latin America By ED Kennedy, STAR Businessweek Correspondent

The STAR Businessweek BY Christian Wayne – Editor at Large

Between the ongoing shutdown of the US Federal Government that’s left thousands of American government employees in a middle ground of semi-unemployed purgatory, and the feverish English cacophony that’s formed around Theresa May’s floundering Brexit negotiations, international bystanders like Saint Lucia— who are not affected in any meaningful way by either of these domestic squabbles in the US or UK but are nevertheless fascinated by any political discordance that is not our own—are left wondering if the foundations of the developed Western world are truly beginning to crumble. This may be a drastic perspective, but the stark reality becomes clearer as we look at the ferocious tidal waves of nationalism, isolationism, and the ebbing of globalization that seem to be engulfing what many of us believed were the final bastions of democracy, free-market capitalism, and border openness in the Western world. Not only are the metropoles of the new world order at risk of asphyxiation from burying their belligerent ostrich-esque heads in the sand, but the very institutions that represent the mechanics of globalization are also under siege. The long-ignored cracks in the foundation of the World Trade Organization (WTO) are quickly becoming fissures as the aftershocks of Donald Trump’s pull-outisms ripple across the international arena. For more on what’s taking place at the WTO and what it means for Saint Lucia, look no further than our lead story: “WTO Reform: Repercussions for Small Island States” starting on the cover page. While Donald Trump may be the archetype for stubborn deglobalization, his rhetoric has inspired—at least in part—a wave of free-market, right-wing nationalism that has swept across Brazil; the largest and most populous country in Latin America and the eighth largest economy in the world. Jair Bolsonaro, an archangel for the emergent pro-business, hyper-conservative global political movement, which counts Donald Trump, Pro-Brexiters and a small but increasingly worrisome number of European leaders like Viktor Orbán of Hungary in its ranks, rode a wave of popularity into the Brazilian presidency and his new presidential accommodations in Alvorada Palace, Brasilia. For what the Bolsonaro presidency could mean for the continent and its allies in the Caribbean, read “Jair Bolsonaro’s Ascent: A Fork in the Road for Latin America” starting here on page 2.

It’s Nothing Personal. It’s Business. Stay connected with us at: Web: www.stluciastar.com Social: www.facebook.com/stluciastar Email: starbusinessweek@stluciastar.com

Jair Bolsonaro, currently serving as the 38th President of Brazil since the beginning of January 2019

n New Year’s Day Jair Bolsonaro was sworn in as president of Brazil. The veteran congressman’s inauguration was not just an incredible moment in Latin America’s political history, given the story of Bolsonaro’s rise to the presidency, but also for his promise to bring change to the way in which the Brazilian government conducts its affairs at home and abroad. Bolsonaro will lead Brazil into 2019 and the decade ahead with a strong right wing ethos unseen in Brazil’s modern history. In order to understand the opportunities that may be pursued for regional businesses during the Bolsonaro era, it’s essential to explore what this new leader means for South America’s biggest economy, Saint Lucia and wider Latin American.

Brazil in Statistics

When it comes to the power and economic influence of Brazil, many people in the Caribbean business community will hold a general understanding, aware that Brazil is the largest nation in South America, the biggest economy in Latin America, and one that has been predicted to become a real powerhouse in years ahead. But when examined in-depth, the stats shows just how influential Brazil is, compared to other regional nations.

With a population of around 210 million, Brazil holds over four times the population of the region’s second largest nation, Colombia. While recent years have seen the nation’s economy embattled — slipping back from its record ranking that overtook the UK as the 6th largest nation in 2014 — it still remains in the top 10. Brazil’s nominal GDP of US$ 1,909,386 million far outpaces the three other Latin American nations in the top 50: Mexico at 15th place (US$ 1,199,264 million), Colombia at 39th (US$ 336,940 million) and Chile at 42nd (US$ 299,887 million).

Brazil at Home

We’ve previously detailed at STAR Businessweek the tremendous growth Brazil has seen since 2000, alongside its geopolitical weight. The power of Brazil locally and globally is why it’s no overstatement to say that the new direction President Bolsonaro seeks, could drive widespread change, not just in his nation, but throughout Latin America, both economically and within the wider dynamics of the region. The latter is especially so given Bolsonaro’s already storied ability to generate controversy. Often compared to US President Donald Trump while running his election campaign, like the current occupant

of the White House, Bolsonaro’s campaign clearly struck a chord with Brazilian voters sick of ‘business as usual’ in politics, and wanting a new beginning. Trump gave voice to American frustration that, for many decades, megacities on the East and West Coast had gone from strength to strength while so many heartland towns were declining. In a similar vein. the formerly obscure Bolsonaro had a rapid rise to presidential candidate, doing so with a promise to be a clean break from the elites who had presided over Brazil’s worst recession in 100 years, and the biggest corruption scandal in the country’s history in Operação Lava Jato. All the while the unemployment rate remained at a painful 12 per cent. Nonetheless, Bolsonaro’s indications that he might not accept the outcome if he didn’t win the democratic election, fond reminisencces about the era in which Brazil was under dictatorial rule, and his promise to preside over a militarisation of the police force, have political observers domestically and internationally wondering what exactly he envisions as democracy in Brazil.

A New Brazil in the Region

By virtue of the nation’s power, any president of Brazil will always have the capacity to push buttons and see their voice heard throughout Latin America. But Bolsonaro’s rapid rise and bold promises could also see him push for a swift change in the region’s identity. This at a time shortly after Mexican voters elected the leftist Andrés Manuel López Obrador as president, setting up a sharp distinction in outlook between the region’s two biggest nations. Continued on page 5

The Big Read: Africa

The star businessweek

JANUARY 26, 2019

www.stluciastar.com

© The Financial Times Limited [2019]. All Rights Reserved. Not to be redistributed, copied or modified in anyway. Star Publishing Company is solely responsible for providing this translated content and the Financial Times Limited does not accept any liability for the accuracy or quality of the translation

Russia: Vladimir Putin’s pivot to Africa

Moscow is building influence on the continent, to the chagrin of former colonial powers By Henry Foy and Nastassia Astrasheuskaya in Moscow and David Pilling in Johannesburg

s protests raged in Zimbabwe’s cities last week, with police firing live ammunition at crowds who barricaded roads with burning tyres, the target of their anger was 8,000km away. President Emmerson Mnangagwa, who had sparked the unrest by raising fuel prices amid an economic crisis in the southern African country, was instead strolling through the Kremlin for talks with President Vladimir Putin, the first of what Moscow hopes will be many visits by African leaders this year. Amid deteriorating relations with western countries, a diplomatic campaign to win new friends and partners in Africa is at the forefront of a sweeping foreign policy pivot by Moscow, as it seeks fresh alliances to bolster its global geopolitical clout. From Algeria to Uganda, Russia is building influence in Africa, lending support to embattled strongmen, taking on natural resource projects in conflictracked states and positioning itself as a new powerbroker without the baggage of former colonial powers. As well as warm words from Mr Putin, Mr Mnangagwa left Moscow with something more tangible — agreements for Russian investment in Zimbabwe’s diamond industry, a fertiliser supply contract and two financing deals worth $267m. While lacking the financial firepower of China or the longstanding trade relations of former colonial powers, Russia has sought to use its military exports, security apparatus and state-

South African president Cyril Ramaphosa and Vladimir Putin in Johannesburg last July

controlled natural resource companies to gain footholds across the continent. Across Africa, Moscow has deployed teams of military instructors to train elite presidential guards, sent arms shipments and assisted shaky autocrats with election strategies. It has also promised to build nuclear power plants and develop oil wells and diamond mines. These diplomatic outreaches to old Soviet allies or countries previously overlooked by Moscow are aimed at both increasing its sway and unsettling rivals such as the US, Britain and France in a region where they have long held influence. Christian Malanga, an opposition

politician in the Democratic Republic of Congo where Moscow has hailed Felix Tshisekedi as the winner of the recent presidential election despite evidence of voting fraud, says Russia was building on old Soviet ties. “It’s the cold war 2.0,” he says, adding that Russia complemented China in what he saw as a strategy to challenge western influence. “China is the money and Russia is the muscle.” The need for new alliances has become acute since 2014, when western sanctions were imposed against Moscow after its annexation of Crimea. “Russia has been re-evaluating its diplomatic policy since the western

sanctions came into effect,” says Olga Kulkova, senior fellow at the Africa Institute of Russia’s Academy of Sciences. “Moscow realised it needs new partners. “Russia has managed to jump into the last carriage, all our partners are already there. But it can compete well by offering both unique and cheaper services to African nations,” she adds. Western countries are taking note. In December, US national security adviser John Bolton announced a new strategy to combat Russia and China in Africa, accusing Moscow of buying off African nations. “The predatory practices pursued by China and Russia stunt economic growth in Africa, threaten the financial independence of African nations . . . and pose a significant threat to US national security interests,” he said. It was the brutal murder of three Russian investigative journalists in the Central African Republic last July that thrust Moscow’s African endeavours into the spotlight. Shot dead in an attack on their jeep while driving through the countryside, the reporters were investigating the activities of Wagner, a Russian paramilitary company, in a country where Moscow has expanded its presence rapidly over recent years. Their murders, which local officials blamed on a robbery but subsequent Russian investigative reports suggest may have been orchestrated, focused international attention on the role of Russian security assets — both state and private — in the Kremlin’s outreach to African countries. “Western analysts, myself included, only really woke up to this at the sudden appearance of significant clusters of Russian armed men,” says Alex Vines, head of the Africa programme at the Chatham House think-tank in London. Continued on page 7

The star businessweek

JANUARY 26, 2019

www.stluciastar.com

WTO Reform: Repercussions for small island states Continued from page 1

As the developed world tussles over trade, Caribbean governments are watching the fracas with increasing concern — wondering what reform will look like, and how it will affect the region’s longterm trade prospects

Saint Lucia has been a WTO member since January 1995 and a member of GATT since April 1993. The island is a member of a number of group negotiations at the WTO including: Africa, Caribbean and Pacific Countries (ACP), G-90, and the Small Vulnerable Economies (SVEs)

Political will for WTO reform has never been stronger. Core criticisms focus on lack of compliance and the failure of negotiation processes. As the WTO’s membership has grown (to 164 members), so has its complexity. Trade negotiations frequently grind to a halt, rule-making has become more inefficient and burdensome and the inability of members to adhere to, or amend, the existing regulations often results in complete paralysis. As the developed world tussles over trade, Caribbean governments are watching the fracas with increasing concern — wondering

what reform will look like, and how it will affect the region’s long-term trade prospects.

Caribbean membership

Every independent nation in the Caribbean is a WTO member (with the exception of The Bahamas, which is currently preparing for accession), giving these small island states participation in a group that governs 97 per cent of global trade. Saint Lucia has been a member since the outset, joining in 1995, but its association has not always been controversy-free. The decline of Saint Lucia’s banana industry

alongside claims of preferential treatment disadvantaging smaller states and a lack of meaningful participation have led some commentators to view membership as a double-edged sword. Yet most agree — the system may be imperfect but trade liberalisation is vital for Caribbean industry. Developed countries may have the luxury of rejecting multilateralism, but Caribbean economies are fragile and extremely dependent on international trading partners. The region’s small and open economies are vulnerable to natural disasters and global shocks, both of which have

intensified in recent years. The certainty and stability of a rules-based system benefits Caribbean manufacturers by providing access to external markets, and giving island nations a mechanism through which they can lodge disputes against their more powerful trading partners. But if the many problems surrounding the WTO are to be solved, the Caribbean must be part of the solution.

A seat at the table

So far, the debate around WTO reform has largely been driven by more advanced economies, leading many to fear that Caribbean states will be shut out of any future discussions due to their limited bargaining power. Following a 2018 meeting at the WTO headquarters in Geneva, Saint Lucia’s representative H.E Guy Mayers said: “Any new rules must take account of our needs as small vulnerable economies and reflect the interest of our people,” and advocated for the creation of a category within the WTO dedicated to the needs of small and vulnerable island states.

The star businessweek

JANUARY 26, 2019

www.stluciastar.com

Jair Bolsonaro’s Ascent: a Fork in the Road for Latin America Continued from page 2

Bolsonaro’s ascent will be welcome news to those in Washington DC who desire another regional ally to keep pressure on the Venezuelan and Cuban governments. For Xi Jinping and Vladimir Putin, as leaders of the other BRICS nations in Beijing and Moscow, Bolsonaro’s apparent disinterest in being a voice for democracy means he will potentially be a pleasing new addition to the BRICS negotiating table. For the same reasons, the democratic leaders of India and South Africa will surely look upon Bolsonaro’s ascent with some uncertainty.

Finding Common Ground in the Caribbean

WTO Reform: The Beginning of the End or the End of the Beginning?

While there is an informal Small Vulnerable Economy group within the WTO, these countries have been pushing for more recognition for many years and, with reform now within reach, efforts in this area have gained new vigour. Powerful players are joining calls to re-examine the definition of ‘developing nation’ status. Under current WTO rules, members can declare themselves to be developing nations, thereby gaining certain rights and privileges. At present, China, India and Brazil are all considered developing nations — putting them on the same footing as a small island nation such as Saint Lucia. Another area of concern is the dispute processes. While the WTO allows for Caribbean countries to push back against larger trading partners, getting those partners to comply with punitive measures can be a challenge, rendering the WTO provisions effectively toothless. By way of example,

the longstanding dispute between Antigua and the United States over internet gaming began in 2003 and is still yet to be resolved. Antigua alleged that the US was violating international treaties with its ban on online gambling, and the WTO agreed, ruling in its favour in 2004. The US proceeded to ignore the ruling, and refuse to pay compensation as required by WTO rules. Despite being riddled with problems, there is merit in the claim that the WTO is too big to fail. As reform creeps into public discussion, now is the moment for the region to present a united front and ensure that deep-rooted issues are resolved. CARICOM’s Council for Trade and Economic Development appears keenly aware of this opportunity to get ahead of change, and recently called for “inclusive, transparent discussions” so that the region isn’t robbed of its voice and has a chance to shape any future iterations of a modified WTO.

On paper, the reality appears clear-cut: this new Brazilian president will struggle to find common ground with government leaders in Saint Lucia and around the region when it comes to many shared issues. Before he took office, environmentalists were fearing the prospect of a Bolsonaro presidency, especially due to his indication that he would withdraw Brazil from the landmark 2015 Paris Agreement, and surrounding his intentions for the Amazon. Critics would say that the Brazilian government’s poor management of the Amazon has been a enduring issue, and certainly Bolsonaro isn’t set to improve it, campaigning to roll back on previous protections that would increase tree felling and harvesting in the rainforest. Economically, Bolsonaro is something of a paradox, wanting greater protectionism for Brazil’s banana industry, while formulating bold policy with his pro-free market team on big plans for pension reform. His election drew new interest from global markets, but some hesitation to accept this new restart for Brazil, which has had four presidents in the past decade. Though pension reform is a ‘sacred cow’ for Brazil, being enshrined in the (nation’s most recent) 1988 Constitution, it also saw the government drive up a US$ 61.3 billion deficit in 2017 by meeting its obligations under the existing plan. Though consensus on what

The Embassy of Brazil was not available to comment on newly-elected President Bolsonaro’s foreign relations strategy with the Caribbean region

reforms are needed is elusive, observers can all fairly agree that some change is essential. It’s here that Bolsonaro’s greatest impact on the Caribbean could be seen. Like most politicians, the odds are strong that many of the promises he made to win office will not be fulfilled before the end of his term, or ultimately at all. Yet for many nations regionally dealing with an aging population, and confronting hard questions about maintaining social services while balancing a budget, Bolsonaro’s first term promises to be a case study in a Latin American nation turning sharply for a new direction. Should he succeed in restarting Brazil’s economy without flirting with authoritarianism, many past sins could be forgiven; just as Brazilians will retain a long memory if he hasn’t delivered when a new election arrives in 2022. The Embassy of Brazil in Saint Lucia was contacted in relation to this story but indicated, “The Embassy is not able to make a statement on the subject at this time,” on President Bolsonaro’s key priorities concerning engagement with Saint Lucia and the region.

CatCh all NFl games iN ComFort at

Harbor bar! speCial Bar meNu aNd driNk speCials throughout game time!

T HEHAR BOR C LU B.COM

TH EH ARB ORC LUB.COM +1 758-73 1-2 900

1 75 8 731 2 900

The star businessweek

JANUARY 26, 2019

www.stluciastar.com

The Caribbean Economic Outlook By Juan Pedro Schmid

conomists are a depressing bunch. Our role is to anticipate and assess risks, which one could argue makes us too despondent. And if you’re lucky enough to get an optimistic outlook from one of us, it will follow by something like ‘on the other hand, the risks are skewed to the downside’. That said, we just published the December 2018 Caribbean Regional Quarterly Bulletin, which fits into the restrained optimism of our field. While the economic trends in the Caribbean in 2018 are generally encouraging, divergence in the development of the various countries has increased, as have risks to the outlook. According to recent estimates, average growth for the six Caribbean countries that constitute the IDB’s Caribbean Department have increased from 0.6 per cent in 2017 to 1.6 per cent in 2018. In addition, the IMF estimates that these economies could experience 1.9 per cent growth in 2019. However, trends in the different countries vary, as there is a considerable difference in the current and expected macroeconomic performance for 2019 between tourismdependent countries (The Bahamas,

Barbados and Jamaica) and commodityproducing countries (Guyana, Suriname and Trinidad and Tobago). Additionally, Barbados and Suriname face country-specific economic challenges. The performance of tourism-dependent Caribbean countries continues to improve: The Bahamas is recovering from the effects of hurricanes in 2016 and 2017 that led to higher public spending and interruptions in the flow of revenue. For 2018, expectations are for a recovery of growth (2.3 per cent). While Jamaica should see a small acceleration in growth from its recent low levels, Barbados’ economic performance has been affected by the uncertainty affecting its economic situation in the first half of 2018. Commodity-producing nations are turning the corner. These countries benefit from increases in the prices of raw materials. In 2018, economic growth of these countries is estimated to be 2.1 per cent, up from an average of 0.5 per cent in 2017 and growth is expected to reach 2.6 per cent in 2019. For its part, Guyana is already beginning to feel the effects of oil production that will begin in 2020 and is expected to lead to growth rates of more than 20 per cent in 2020 and 2021.

The performance of tourism-dependent Caribbean countries continues to improve

The projections for Trinidad and Tobago are for a slight economic acceleration (growth of 0.9 per cent in 2019 and 1.6 per cent in 2020), while Suriname’s growth rate is projected to stabilize at around 2 per cent. Fiscal adjustment remains high on the policy agenda in the Caribbean. The better economic outlook in The Bahamas should be reflected in a substantial improvement in its fiscal effort (a primary fiscal balance of 0.1 per cent of GDP compared to -3.4 per cent in 2017) that will lead to a stabilization of debt as a percentage of GDP below 55 per cent. Jamaica continues to implement fiscal reforms and has benefited from a reduction in its debt as a percentage of GDP (97.4 per cent at the end of 2018 compared to 145 per cent in 2012). In Barbados, fiscal vulnerabilities had accentuated, prompting the new government to sign a 48-month agreement with the IMF. As a result of fiscal consolidation measures that have already been started, debt-to-GDP is projected to fall quickly. Despite the improvements in the growth rates of commodity producers, the fiscal efforts of these countries remain insufficient. The average primary balance improved only slightly from -5.7 per cent of GDP in 2017 to -4 per cent in 2018, and public debt remains high compared to levels prior to the global financial crisis (average of 54.1 per cent of GDP in 2018 compared to 32 per cent in 2007). The situation is more critical in Suriname, which saw its debt as a percentage of GDP almost triple between 2014 (26.3 per cent) and 2016 (75.8 per cent). While Guyana’s oil production will completely alter its fiscal and debt trajectory after 2020, the recoveries in Trinidad and Tobago and Suriname are expected to be accompanied by a greater fiscal effort that should help stabilizing debt around current levels (43 and 63 per cent of GDP). Several risks to the outlook persist. Apart from Guyana, all countries are pursuing fiscal adjustments that are needed to control debt levels, reduce interest costs, and keep investor sentiment positive. While average debt is 72.9 per cent of GDP in 2018, it varies widely between the different countries: Suriname (62.5 per cent), Jamaica (97.3 per cent), and Barbados (123.6 per cent). Moreover, debt levels are above the debt

sustainability levels of small countries worldwide with open and undiversified economies (approximately 60 per cent of GDP). Other policy reforms that are needed include: improving the business climate, enhancing access to finance, and providing greater support for infrastructure investment (See the September 2018 Quarterly Bulletin for an overview of development challenges). The Caribbean countries are also susceptible to external economic conditions and shocks. Climate change and natural disasters exacerbate the region’s macroeconomic challenges. The estimated cost of the impact of hurricanes and floods in the region is approximately 2 per cent of GDP per year. Taken together, the outlook remains subdued but positive. The world economy is expected to continue its expansion in 2019, but forecasts are slightly less optimistic going forward. For example, in October 2018, the IMF has reduced the overall growth predictions to 3.7 per cent for 2018 and 2019, which is 0.2 percentage points less than its April 2018 estimates. This more cautious tone reflects increasing downside risks and weaker-than-expected performance in some countries together with a possible plateau of growth. For the Caribbean, projections are for slow but steady progress. While several countries still have income per capita below 2007 levels, economic performance has in general improved and the outlook remains positive. The strengthening of commodity prices should benefit the commodity-producing countries. This is especially the case for Guyana, where imminent oil and gas production is raising expectations of a strong push to GDP. Tourism-dependent countries need to continue to implement the reform agenda, especially regarding fiscal affairs and debt. The outlook for these countries will depend on their ability to continue to lower debtto-GDP ratios and on favourable external conditions. In addition, all countries should pursue growth-friendly reforms and ramp up infrastructure investments, which have suffered since 2008. Juan Pedro Schmid is a Lead Economist in the Caribbean Country Department of the Inter-American Development Bank (IDB).

The Big Read: Africa

The star businessweek

JANUARY 26, 2019

www.stluciastar.com

Russia: Vladimir Putin’s pivot to Africa Continued from page 3

“It was like: ‘My God, what have we missed and why have we missed this?’” Moscow has sent planeloads of arms to the country, alongside five armed forces personnel and more than 200 private military contractors to train hundreds of elite troops. Valery Zakharov, a former Russian intelligence official, is the national security adviser to CAR president Faustin-Archange Touadéra, and Russia is setting up a team inside CAR’s defence ministry. This month, during a visit to Russia, CAR’s defence minister told state media that there was a “possibility” of Moscow opening a full military base in the country. Such actions have unnerved France, CAR’s former colonial ruler and traditionally its most prominent foreign ally. Roland Marchal, a Russia-Africa expert at Sciences Po, says Moscow’s approach of supporting African leaders through government-backed defence and industrial deals is straight out of the “Françafrique” playbook of the 1970s and 1980s, when the state and commercial interests of Paris were intertwined. “It’s pure Françafrique. Change the flag and you have the same methodology,” he adds. A senior European diplomat in Moscow says: “We don’t know exactly what they are doing in the Central African Republic, but we don’t like it too much. We are not sure that the [CAR] government is completely controlling everything.” While the Central African Republic has dominated the headlines, Russia’s activity is increasing across the continent. In 2017, Russia’s trade with Africa rose 26 per cent to $17.4bn. Russia sold twice as much weaponry to African countries in 2017 as it did in 2012, according to the Stockholm International Peace Research Institute. Between 2013 and 2017, Russia supplied 39 per cent of Africa’s imported arms — compared with 17 per cent from China and 11 per cent from the US. In 2014, Zimbabwe concluded an arms-for-platinum deal with Russia worth a reported $3bn, bypassing both a European arms embargo and its lack of hard currency to swap rights to the Darwendale platinum concession for the provision of an undisclosed number of MiG-35 fighter jets. The list of Russian commercial engagements with Africa is long. Russian aluminium group Rusal mines

New recruits for the Central African Armed Forces (FACA). Moscow has sent planeloads of arms to the Central African Republic, alongside five armed forces personnel and more than 200 private military contractors to train hundreds of elite troops © AFP

bauxite in Guinea. Alrosa, the Kremlincontrolled diamond miner planning to enter Zimbabwe, already has assets in Angola and Botswana. Rosatom, the state-run nuclear monopoly, is working in Zambia and Rwanda. Russian geologists are active in Madagascar, Algeria, Libya and Ghana. Rosneft, Russia’s largest oil company, is developing oil and gasfields in Egypt, Mozambique and Algeria, and rival Lukoil has projects in Nigeria, Ghana and Cameroon. “Moscow and Beijing are clearly competitors over natural resources, but the Russians will not beat China in Africa,” says Mr Vines. “It is minor league in comparison. “But with the US retreat, there is space for Moscow to be mischievous. It is about optics and, to a certain extent, smoke and mirrors to present itself as a global power,” he adds. “The Russians are looking for areas where they can unnerve western opponents . . . some of whom are truly shocked at what is happening.” Take South Africa. Last October, former finance minister Nhlanhla Nene told an inquiry into so-called “state capture” that he had been sacked in 2015 because of his refusal to sign guarantees for a R1tn ($70bn) nuclear deal with Rosatom . His replacement with someone considered more pliable triggered such a sharp fall in the rand that the incident came to be known as “Nenegate”. Mr Nene said the deal would have been ruinous for South Africa, but would have benefited some of former president Jacob Zuma’s associates, including the Gupta family at the centre of allegations of state capture. The Guptas owned a uranium

deposit, though both they and Mr Zuma have denied any wrongdoing. In 2015, Mr Zuma flew to Russia for emergency medical treatment, and it was during his recovery that he is reported to have struck the nuclear deal with Mr Putin. “Russia had never had a very strong presence in South Africa until Zuma got into power,” says Lumkile Mondi, a senior lecturer at the University of Witwatersrand. “Through him they were trying to get in and gain control, given that historically the Anglo-American countries have been our partners. Then the BRICs countries came in and Russia wanted a piece of the pie.” While Moscow is keen to build new relationships, it is no stranger to the region. During the cold war, the Soviet Union had strong ties with various African states, supporting independence movements aimed at dislodging western colonial powers. João Lourenço, Angola’s president, studied at the elite Lenin Political-Military Academy in the late 1970s, and it was the Soviet Union’s 1956 support for Egypt in the Suez Canal crisis that helped to force the UK, France and Israel to abandon their military action. Moscow has made this legacy a central pillar in its African outreach, contrasting its history of engagement with that of former colonial powers. “Russian-African relations have a rich history, while, unlike the former global powers, Russia has not tainted itself with the crimes of slavery and colonialism,” the Russian foreign ministry says in a statement. “In the middle of the last century, our country actively contributed to the achievement of national independence and sovereignty of African countries . . . Many

African leaders are well aware of this.” Alongside this, Moscow is also willing to sidestep issues such as demands for reform or human rights protection — a tactic that it has effectively deployed in recent years to build strong ties in the Middle East. “In Africa they present themselves as mediators, as honest brokers,” says the senior western diplomat. “You see a common thread across Angola, DRC, Mozambique. It’s obvious — they are repeating their successful Middle East strategy and seeking to mine the Soviet legacy.” Sergei Lavrov, foreign minister, said last week that Russia did not agree with outside countries calling for an investigation into the presidential election in Congo, which data published by the FT show was fraudulent. “We do not interfere with elections,” Mr Lavrov said. “The Congolese people can handle this on their own and it is important not to impose this or that agreement as is normally done by France, the US and other former colonial powers.” Leaders such as Joseph Kabila, who is set to step down as president of Congo, see Russia as a way around the west’s tough requirements on transparency and governance, says Mr Malanga, the opposition Congolese politician. “All the actors like him are turning back to Russia. We’ve seen that in Venezuela and with Assad in Syria and that’s basically what African leaders are looking for today.” This month, Russia’s ambassador to Guinea — a country that had close relations with the Soviet Union — suggested that President Alpha Condé could change the constitution to stay in power for a third term. “Constitutions are no dogma, Bible or Koran,” said ambassador Alexander Bregadze. “Guinea needs you today. And as the popular Russian saying goes, you don’t change horses at a river crossing.” Moscow hopes that Mr Mnangagwa’s three-day visit will not be his only trip to Russia in 2019. The Kremlin is hard at work arranging its first RussiaAfrica summit this year. As the most prominent example of its outreach to the continent, it is aware that its success will be judged by the number of heads of state that make the trip north. “Zimbabwe is under the yoke of sanctions imposed by western countries,” Mr Mnangagwa told Mr Putin in the Kremlin. “However, through these days of isolation, you, Russia, have remained with us as a reliable partner.”

The star businessweek

JANUARY 26, 2019

making moves

www.stluciastar.com

Village Tourism Is Alive! Jahrod Alcindor Talks Eco-Tourism By DEAN NESTOR, STAR BUSINESSWEEK CORRESPONDENT

fter being named Tour Operator of the Year, 2018 by the Saint Lucia Industrial and Small Business Association (SLISBA), Jahrod Alcindor is looking to take his business, Eco Adventures Saint Lucia Tours & Taxi, into its next phase. He’s been in the business for over two decades, learning whatever he could about tour operations from the companies he worked for. But ten years ago, he decided to take all that he’d learnt and apply it to his own business, bringing something fresh to tour operations in the country. STAR Businessweek sat down with Alcindor to talk to him about the burgeoning reputation of his company, and what exactly sets it apart from others of its kind.

What got you interested in this kind of stuff?

Jahrod: Well, I was born and raised in Soufriere and then lived in Mabouya Valley. So, being from the town, I used to hike

Jahrod Alcindor laughing with tourists as they journey to the famed Sapphire Falls

the outskirts of Soufriere, going to the Ruby Estate and near the rivers because, you know, we have all those natural resources at our disposal. As a child, I took the opportunity to explore those things. Growing up, I was used to seeing tourists in our town. My mother was in the tourism

the

fastest speeds

are here! Sign up today to enjoy the fastest upload and download speeds on St. Lucia's best network.

turbo 2 customers now have 10mbps turbo 10 customers now have 20mbps turbo 25 customers now have 35mbps turbo 50 customers now have 75mbps

industry. So all those things have fuelled me into getting involved, getting engaged in that kind of industry.

How long have you been in business?

Jahrod: My business was registered in 2008 but, because it was a start-up, I still worked for different companies. Later on, I realised that I could create a new avenue for myself and be self-employed, and create a unique activity. So, in a way, getting employed with those other firms actually helped me get to know the ropes, the ins and outs of the industry. I’m not trying to be super-rich but just trying to be self-sustained and get persons to appreciate nature a little bit more and know about our island.

What’s offered on your tours?

Jahrod: We offer here at Sapphire Falls a nature trail. We get to see the parrots at this point in time. We give a botanical tour as well as an historical one. We inform customers about the plants and their medicinal value. We also inform them about the healing properties of the minerals and the water itself. We have a unique mud here which is an orange clay, very rich in iron, so our customers enjoy taking mud baths. We also have an iron-based pool that rids your body of toxins and makes you feel younger. Besides the land-based activities, we offer marine and sea-based ones as well. We’re planning on going into camping. We’re going to have a camping ground here and our first camping group soon. We also offer traditional cooking — we have our clay pots at the ready!

In terms of the business end, Has it been profitable?

Jahrod: We’ve had our ups and downs. There have been trials and tribulations

but I have the mindset of ‘never give up’ and I always put my best into it. I always take the pitfalls and try to turn them into positives. So that gives me strength to continue. At present the business is profitable because it’s getting popular and it seems like there’s an upward trend of people wanting to do new things. Frequent visitors are always seeking new places to explore and new things to do. That fits in perfectly with my vision. Our location is not always crowded. It’s pretty much oriented towards private groups; for persons who want to be in their own zone. Given that we don’t have large numbers the tours are a bit . . . I won’t say pricey but our prices are attractive. So you could come in, pay your entrance fee, get a guide and do the tour. And we also do the pick-up and drop off; we provide drinks, we provide lunch and we connect with the local people to give them a slice of the pie. So we have the local restaurants getting involved: we get the cocoa tea, the salt fish and the local creole food.

What are the reviews like?

Jahrod: Positive. We always get positive reviews. There are quiet days but there are days when things are extremely busy. Very busy! I have a Trip Advisor page — Sapphire Falls and Jungle Spa — so a lot of persons are giving reviews. Readers are impressed so they’ve contacted me and called me to let me know that they want to experience my tours. There’s even been one instance where visitors in Barbados flew over here for the day just to experience this tour. And when they communicated this to me, I was taken aback! If you’d like to book an Eco Adventures Tour with Jahrod, contact (758) 716-8396 or visit www.stluciaecoadventures.com

Printed & Published by the Star Publishing Co, (1987) Ltd. Rodney Bay Industrial Estate, Massade , P.O. Box 1146, Castries, St Lucia, Tel (758) 450 7827 . Website www.stluciastar.com All rights reserved