Editorial — 23 July 2013

There is a mountain range in Guinea which is estimated to be worth U.S. 140 billion dollars because of the raw iron ore it contains. An Israeli billionaire named Beny Steinmetz got ahold of the rights to that iron ore, which is the raw material from which factories manufacture steel, for a few hundred million dollars. He supposedly bribed the fourth, and youngest, wife of a dying Guinean dictator in order to get those rights, which he then sold to a Brazilian-based company for a few billion.

An honest ruler has emerged in Guinea who is trying to recover the rights to the iron ore in the Simandou range so that a fair deal can be made which benefits the poverty-stricken people of Guinea, a West African nation-state. The honest ruler, however, is slowly becoming heavy-handed, because greedy and dishonest people are seriously trying to overthrow him.

The saga in Guinea, which is the subject of a recent article by Patrick Radden Keefe, is a classic tale of how absolutely difficult it is for poor Third World countries to have the masses of their people benefit from valuable natural resources the territory may contain. Mining iron ore is a complicated technology, and requires huge amounts of capital, neither of which the Guinean people possess. So, First World businessmen and corporations which have access to the technology and investment capital, routinely exploit the situation in poor countries which have potential wealth in the form of natural resources.

Where the iron ore is, in mountains which are hard to access, it has no value until it is mined and transported to factories which convert it into value-added steel. The element of time enters the picture. How long will it take Guineans to accumulate their own capital and acquire the necessary technology for themselves to mine their own iron ore? A leader or ruler of such a country is always severely tempted to make a deal which enriches himself, his family and his sycophants in the immediate present. When such deals are made, the rulers, their families and sycophants deposit the money with which they have been bribed, in the banks of the developed world, and they buy expensive properties and fabulous mansions in that said world. So that, the money which buys the rights to the poor country’s natural resources for a relative pittance, does not even stay in the poor country itself. The money flees to the banks of rich countries. The cycle of misery and poverty continues in the poor country. When “wealth untold” is only of a potential nature, the achievement of real, value-added wealth is only a dream in poor countries: there are no guarantees of potential ever becoming converted into reality.

The case of Belize’s rosewood is a classic case of value-added, because in its ultimate Asian markets, once the rosewood trees are cut and shipped overseas from the forests of Toledo, the rosewood becomes incredibly more valuable. The vast difference between the cost of Belizean rosewood in its natural state and its processed value in China, say, is the money which causes some Belizeans to break Belizean laws and encourages Belizean politicians, their families and their sycophants to become corrupt, which is to say, put their personal wealth ahead of the welfare of the Belizean people.

The Government of Belize, in its overall reality, is not in a position to run the rosewood business, even if rosewood extraction and exportation were legal, which they are not. But, a small, specific section of Government-connected Belizeans have become expert in the movement of Belize rosewood to Asia, and because of all the money involved, they have been able to weaken the Barrow government’s declared commitment to transparency and honest government. That small, specific section has the marketing and distribution connections in Asia. So when the Government of Belize, after first dramatically burning some illegal rosewood, decided Government might as well just sell confiscated rosewood, they sold it at a fire-sale price to the said small, specific section which has the marketing and distribution connections.

On Ya Ya Marin Coleman’s Sunday Review on Sunday morning, the panelist Bill Lindo essentially described Minister Lisel Alamilla’s deal as Mephistophelian. It does appear that way, but there are two points to be made here. In the first instance, she is doing the bidding of the larger Cabinet, and, secondly, most Belizeans in her position would have done what she did. Very few of us would have resigned, which was probably the proper thing to do. We are a cynical people in Belize. Most of us expect our elected politicians to cut deals, and some of us even expect them to cut us in on the proceeds.

This is the way it is all over the Third World, except where the governments are described on Wall Street as “socialist” or “communist.” They say a bird in the hand is worth two in the bush. They also say, the cow is starving while the grass is growing. In such wise, corrupt politicians salve their conscience when they enrich themselves while the people suffer.

Because of decisions like these, one after the other, our national football selection was not properly financed, our national stadium cannot be completed, we have not had a basketball auditorium for years, and concerts and other promotions have violated the sacred MCC Garden.

On the hill, they eat well and they drink well. It may be that they also sleep well. They should not. One day there will surely be a reckoning.

Power to the people.

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