World Goes to the Polls in Brazil

At the 2016 Summer Olympics in Rio de Janeiro, a reporter went up into the hills to interview young boys flying kites. A translator conveyed the false notion that people living in the crowded makeshift homes above Rio preferred their friendly communities to the lonely confines of the modern homes in the city below. Those flying the kites told a different story. They saw the kites as a symbol of their dreams to escape.

     By a margin of 55% to 45%, Jair Bolsonaro was elected Brazil's new President on October 28, 2018. His concern for money laundering, financing of terrorist groups, and other suspicious transactions in Brazil led to granting more power to the country's Financial Activities Control Council (COAF). Promoted as a way to speed investigations and integrate the functions of various government agencies, others view this bureaucratic reorganization as a threat to traditional guarantees of bank and financial secrecy.

     Brazil's most popular politician was not running in the first round of voting for president on Sunday, October 7, 2018. An independent judiciary found Luis Inacio Lula da Silva, Brazil's president from 2003 to 2010, guilty of corruption and sentenced him to prison. Like others in Brazil's political elite, Lula, as he is known, was charged with taking bribes from construction companies looking for contracts from Brazil's state-controlled Petrobras oil company. Since the Odebrecht construction company was not satisfied only to bribe itself into Brazil's political process, the world has an opportunity to prosecute its corrupt tentacles in at least ten Latin American countries, the United States, and Switzerland. (See the latest news about Odebrecht's bribery case in Colombia in the post, "Cut Off the Head and the Colombia Snake Dies?") In the United States, Petrobras itself, which trades in the US market, was fined $853 million for corruption under the Foreign Corrupt Practices Act.

       Fernando Haddad, the former Sao Paulo mayor with degrees in economics, law, and philosophy, represented Lula's Workers Party (PT) in the first round voting of the presidential election. The PT, which once brought prosperity to Brazil under Lula from 2003 ti 2011, gave way to the mismanaged economy, recession, and bribery of his successors: Dilma Rousseff, who was impeached for hiding the country's budget deficit, and Michel Temer, who fought a charge of corruption . Haddad is tainted with his association to PT's past sins and a suspected willingness to end an investigation into corruption.

      The Brazilian rainforest, considered the world's lungs for its ability to absorb carbon dioxide and combat rising temperatures, drought, and fires, is endangered by Jair Bolsonaro, a former army captain who belonged to nine different political parties during his 28-year congressional career. As expected, Bolsonaro and Haddad met again in the second round of voting. In the first round,  Bolsonaro nearly won half the vote needed to avoid a runoff

     Bolsonaro is the hero of Brazil's soybean farmers and cattle ranchers, because he would withdraw Brazil from the Paris Climate Accord and open the way to finance unlimited deforestation of the rainforest. With his running mate, General Hamilton Mourao, he shares an authoritarian approach to reversing the effects of Brazil's lingering 2014 recession: unemployment, reduced personal income, and a lack of education, health, and other government services. It also should be noted, Brazil's National Museum of historic treasures, housed in a once beautiful Portuguese palace, burned down on September 2, 2018, despite warnings about a lack of maintenance. Mourao claims the army has the ability to solve Brazil's problems, including drug-related violence, the way Brazil's military dictatorship did from 1964 to 1985.

     Bolsonaro's supporters like his outspoken attacks on indigenous rainforest communities, women, blacks, and homosexuals. During the first round of voting, Bolsonaro was in the hospital while recovering from being stabbed in the stomach at a campaign event. He claims to be Brazil's President Trump, when one is more than enough for the world.

     Brazil, once one of the promising emerging markets known collectively as the BRICs (Brazil, Russia, India, and China), has fallen on hard times, but the country is too important for the world to ignore. There will be as many as 30 different political parties in Brazil's new congress. The Brazilian Democratic Movement (MDB) that dominates congressional coalitions has to deal with members used to receiving pay-offs in jobs, funds for pet projects, and graft in return for passing necessary reforms.

     The world's multinational corporations are in a position to exploit Brazil's political, economic, and social woes or to dream up win-win solutions for their stockholders and the country's kite flyers.

     Local farmers complain that the Brazilian Agricultural Research Corporation (Embrapa) that developed maize, soybeans, eucalyptus trees, and zebu cattle to thrive in the tropical heat and acidic soils on the savanna that covers 5% of Brazil's farmland no longer helps them. Biotechnology, now in the hands of Bayer, which just acquired Monsanto, and Syngenta, a Swiss pesticide producer, serves their agribusiness interests. Meanwhile, Munduruku tribe members, who formed the COOPAVAM cooperative, watch farms press toward the patch of forest where they harvest the wild Brazil nuts they press into oil for eco-friendly Natura cosmetics and school lunch food. At the very least, multinationals could abide by government regulations requiring only 20% of forest areas should be cleared for farming.

     Boeing is in a position to honor or undercut the interests of Brazil's Embraer aircraft company employees and its metalworkers union. Young engineers are used to moving from projects on commercial aircraft to executive jets to defense projects. Since Boeing is only interested in acquiring the company's short-range, 70- to 130-seat commercial jet business in order to compete with Canada's Bombardier, Inc. and Airbus, excess employees rightly fear they would lose their jobs. Couldn't Boeing's worldwide operations offer them employment elsewhere?

     All in all, Brazil's presidential election is a world, not just a national, event worth watching.
   

China's New Acquisition Strategy?

To gain control of an important foreign asset, does China try to appease a foreign country by offering to establish its mainly symbolic company headquarters there? At least two recent cases raise this question.

Before Broadcom acquired the New York-based chipmaker, CA Technologies, suspicious Chinese connections of Broadcom's CEO, Hack Tan, helped prevent a takeover of major US chipmaker, Qualcomm. Besides becoming chummy with President Trump prior to the failed purchase of Qualcomm, Hack Tan had moved Broadcom's headquarters from Singapore to San Jose, California, close to Qualcomm's headquarters in San Diego, CA. (Caught up in tariff and trade adjustments between the U.S. and China, Qualcomm failed to receive approval from Chinese regulators for its acquisition of Dutch rival, the NXP semiconductor company, and terminated its two-year effort in July, 2018.)

Before its failed bid to acquire Portugal's largest utility company, state-owned China Three Gorges, which already owns a 23% share in EDP (Energias de Portugal), offered to keep EDP's headquarters in Lisbon.

Corrupt Government Turnaround in Angola?

In Angola, President Joao Lourenco attempts to join Muhammadu Buhari in Nigeria, Adama Barrow in The Gambia, and Emmerson Mnanggagwa in Zimbabwe, the new leaders trying to break with a tradition that allowed African rulers to put their own interests ahead of their countries'.

     After unseating Jose Eduardo dos Santos, Angola's president for 38 years, Lourenco began a crackdown on corruption rampant among the country's elite. Starting with the former president's rich daughter and son, he removed Isabel as head of the country's national oil and gas company, Sonangol, which exported $640 billion since the end of Angola's civil war in 2002 and charged Jose Filomeno with fraud for attempting to transfer $500 million from the country's $5 billion wealth fund through a London account.

     Although the price of crude oil has rebounded from its 2014 low, as Africa's second-largest oil producer after Nigeria, Angola was still left with public debt, mainly to China, hovering between 65% and 80% of GDP, and missing billions, when Lourenco took office. To revive the economy, the new president no longer requires foreign investors to have local partners and asked the International Monetary Fund for advice. Suggested next steps include: an independent audit to discover where revenue from oil and diamond exports went, especially to overseas accounts. Locals share information about the corruption crackdown in Brazil, another former Portuguese country, that has sent former high-level officials to jail.

     Additional needed reforms include: elimination of excessive licenses and regulations that provide bribery opportunities for those issuing or waiving them; improving living and health care conditions to reduce the country's high child and maternal mortality rates; stripping courts of political influence; freedom of the press and media, especially to report on corruption; and Angola's first local elections in 2020.

     Meanwhile, in Portugal's other former African possession, Mozambique, the continuing 3-year attacks by a group of radical Muslim jihadists resulted in new beheadings in May, 2018.

     While African leaders like Rwanda's President Paul Kagame, who led the Tutsi rebels who overthrew the Hulu regime responsible for genocide, and President Pierre Nkurunziza in neighboring Burundi intimidate their opposition and dictate constitutional reforms that enable them to extend their presidential terms to 2034, every indication of a gradual shift to responsible government by the rule of law on the African continent is welcome.

   

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UN Secretary-General Nominee

Although seven of the 13 candidates for UN Secretary-General were women, Security Council members recommended the General Assembly elect Antonio Guterres, Portugal's former prime minister and a devout Catholic, for the position (See the earlier blog post, "Front-Runners for UN Secretary-General.").

     Guterres served as the UN's High Commissioner of Refugees from June, 2005 to December, 2015. In his campaign-like speech to the General Assembly, he said the UN is "the best place to address the root cause of human suffering." Should he assume the five-year term of Secretary-General on January 1, 2017, he will take on the difficult task of uniting members, including Russia, to end human suffering in Syria.

Front-Runners for UN Secretary-General

Considerations for choosing a new UN Secretary-General before Ban Ki-Moon's term ends this year:

• Eastern Europe has never been represented in this position
• A woman has never been the UN's Secretary-General
• All permanent UN members (US, UK, France, Russia, and China) have to agree on the nominee
• He/she has to have the support of his/her country

Front-runners:

• Irina Bokova from Bulgaria
• Vuk Jeremic from Serbia
• Danilo Turk from Slovenia
• Vesna Pusic from Croatia

Others who have shown interest:

• Helen Clark from New Zealand
• Natalia Gherman from Moldova
• Antonio Guterres from Portugal: Chosen by Security Council members Oct. 6, 2016 
• Srgjan Kerim from Macedonia
• Igo Luksic from Montenegro

Discover Africa

The African continent is three times the size of the United States and nearly three million square miles bigger than Europe, including the Asian portion of Russia. By 2100, the U.N. estimates Africa will have 3 billion more people than it has now. Future opportunities in this vast and growing continent need not be overlooked because of the world's somewhat warped historical viewpoint. A new guide, Emerging Africa, by Kingsley Chiedu Moghalu dispels some of the assumptions about lack of development on the continent. And in 2015, one of the discussions in the Foreign Policy Association's Great Decisions program will feature "U.S. Policy Toward Africa."

    Headlines do not tell the whole story of what is happening in Africa. News reports rightly warned that the Ebola virus was out of control in West Africa. In April and May of 2014, the world heard that over 200 teenage girls were kidnapped by Boko Haram, an Islamist terrorist group in northern Nigeria. Since then, the group has taken additional girls and women as wives, cooks, and suicide bombers; young men and boys have been abducted to serve as soldiers. On January 15, 2019, al-Shabab terrorists with ties to al-Qaeda would kill at least 21 in an attack on a hotel/office complex in Nairobi, Kenya. In April, 2015, jihadis from al-Shabab killed 147 in a raid on a Kenyan university. Earlier,  terrorists attacked at a Kenyan mall.

     Europe's scramble to colonize the continent between 1876 and 1912 left independent African countries in the 1960s with an uneducated population, some leaders who exploited their people in imitation of former colonial administrators, disease, and transportation ties to Europe rather than each other. To this day, Fastjet is still having trouble launching its plan to provide affordable African flights.

     But just like Pablo Picasso in 1907, when he first saw the African artifacts that caused him to create a new form of art, young people are in a position to look at Africa in a new way. Beginning with the book Ashanti to Zulu, kids can learn the alphabet and 26 African traditions at the same time. With the help of ePals.com, classrooms can connect with African students in several languages by email, Skype, and project collaborations.

     Students need not see Africans only as impoverished children who can live on 50 cents per day donations. According to trendwatching.com, 65% of Africa's 8- to 18-year-olds have access to a mobile phone. In Gambia and Ghana, trendwatching.com reports entrepreneurs run solar-charging kiosks where the public can charge their mobile devices for a fee. In addition to social contacts, mobile devices are facilitating education and job-hunting in Africa. By 2060, trendwatching.com expects there will be 1.1 billion middle class Africans. Already, the SABMiller bottler and Coca-Cola have joined forces to profit from Africa's growing middle class.

    Africa's growth is attracting $24 billion in foreign investment this year. In fact, the Financial Times (April 4, 2014) reported that return from private equity investments in Africa is comparable to the return on investments in China and Latin America. No wonder the Rothschild Fund is looking to invest $530 million in African projects that have a long term social development aspect to them. And the Swedish risk capital firm, Swedfund, is investing in a partnership between the H&M retailer and Ethiopian textile firms that manufacture according to high social and environmental standards. (Also see the later blog post, "Never Too Young to Invest in the Future.")

    Forbes magazine listed 27 billionaires in Africa. Today's richest African is Aliko Dangote of Nigeria, who makes his money from the cement used for construction throughout Africa. Recognizing the potential for African construction, Dubai has invested $300 million in Dangote Cement. Other riches have been made in areas, such as oil, sugar, flour, banking, media, telecommunications, luxury goods, diamonds, supermarkets, and pharmaceuticals. Looking past the current drop in oil prices, Dangote increased his oil refinery investment from $9 billion to $11 billion in December, 2014. (Nonetheless, his estimated $21 billion fortune has taken a $5.4 billion hit due to sagging oil prices.) Stephen Saad of South Africa, founder of Aspen Pharmacare, is making his fortune by manufacturing generic drugs. Isabel dos Santos, Africa's first female billionaire, a former head of Angola's state oil group, and the daughter of Angola's president, is a major player in the banking industry. She seeks to block Spain's CaixaBank's attempt to assume full control of the Portuguese bank, BPI, where she is the second largest investor. As an alternative, she has proposed a merger of BPI and Portugal's Millennium BCP bank to reinforce their presence in Africa's Portuguese-speaking Angola and Mozambique. (As of President Joao Lourenco's election as President of Angola, Ms. dos Santos no longer heads Angola's national oil company and the former president's son has been charged with fraud for transferring $500 million out of the country.)  Bob Diamond's Atlas Mara, founded to invest in Sub-Saharan African financial institutions, continues to expand with its latest interest in a 45% stake in Banque Populaire du Rwanda.

     African startups also are winning outside support. IBM's "Project Lucy" coordinates the work of local universities, development agencies, startups, and others who want to create ventures that solve key African issues. BiztechAfrica reports that, as part of its 4Afika Initiative, Microsoft has made five innovation grants to the following startups: Uganda's access.mobile, which facilitates information sharing in the fields of agriculture and healthcare, Kenya's Africa 118, a mobile directory service, and Kytabu, which rents textbooks on tablets (A US entrepreneur just found funding for a similar project on the TV show, "Shark Tank"), and Nigeria's Gamsole, which creates games for Windows, and Save & Buy, which facilitates e-commerce purchases.

     In a long entry in March, 2014, " trendwatching.com's African" described how African governments and developers are facilitating areas, like Ghana's Hope City, Nigeria's Eko Atlantic, and Kenya's Konga Techno, that invite entrepreneurs to set up shop. Better than being  unemployed, business-minded young adults are responding by using crowdfunding platforms, such as Globevestor; developing tech applications, such as Nigeria's bus travel website (bus.com.ng); entering competitions (South Africa's First National Bank holds an "Ideas Can Help" competition for inventors, Yola sponsors a build-your-own website contest, there's a Anzisha Prize and a TechCabal Battlefield prize); and formalizing Africa's informal economy of outdoor markets, street hawkers, and resellers. Kenya's e-commerce Soko platform, for example, now connects global shoppers with local jewelry artisans who use natural and upcycled materials. FirstBank Nigeria is one of the firms that facilitates secure online payments.

      Projects involving the rich history of Egypt are already a staple of school curricula. Tracing Mansa Musa's religious pilgrimage from Timbuktu, the West African city in Mali, to Mecca in 1324 introduces an African mogul who distributed gold on his journey and returned with an architect to build a great mosque and scholars who created the Sankore University. A video about Shaka Zulu can introduce students to a military genius.

     Looking back through previous blog posts, Africa is mentioned in a variety of contexts.

• There are T-shirt designs from Swaziland and a U.S. artist who studied at the University of Cape Town in South Africa ("Global Drawing Power")
• Somali children were featured in Asad, the live action short nominated for a 2012 Academy Award ("See the World at the Movies")
• Paul Simon's "Graceland" recording incorporated the township rhythms of South Africa ("Music of the Sphere")
• Ghana's kente cloth was mentioned in "The World of Fashion" and Ghana's chocolates tempted taste buds in "Pizza, Plantains, and Moo Goo Guy Pan."
• In 2004 Wangari Maathai of Kenya won a Noble Prize for mobilizing a campaign to fight global warming by planting trees and launched the U.N. project to plant a billion trees around the world ("Hope for the Future" and "A Healthy Environment")The website, About.com African History, has a list and description of Africa's 25 Nobel Prize winners. 
• Students located the African countries that produced the products they found in their scavenger hunt bags ("Games Children Play")

Just like the missionary, David Livingston, who happened to come upon the African falls he named for Queen Victoria, Africa still is open for discovery. China has discovered Africa's many minerals, such as iron ore and copper, and is building railroads to transport them to ports for export. French-speaking Chinese students have followed Chinese companies to work for them in former French colonies. Oprah Winfrey has founded a school for girls in Africa. The Bill and Melinda Gates Foundation has set out to help eliminate malaria and HIV in Africa. George Clooney sent up a satellite to watch for atrocities in the Darfur region of Sudan. And, like Alexander McCall Smith, the author of The No.1 Ladies' Detective Agency in Botswana, there's still the possibility of finding riches by writing one of Africa's fascinating stories.