It’s difficult to imagine that our liquid continent– the largest continent on our blue planet is on the cusp of becoming privatized by both corporate interests and militarized foreign conservancy.
How this is occurring may seem convoluted and exploratory, but there is creeping legislation being proposed at the international level that seeks to manage and account for our Pacific water and our ocean biodiversity. The questions that we should be asking is how this is happening and what we can do to ensure that this never happens.
There’s a saying going around, “It’s not China, it’s not Russia, it’s the 1%, stupid.” In the U.S., the corporate elite have been running rampant with their wealth-accumulating privatization agenda and many of our most esteemed news journals, have either turned a blind eye to these new policy initiatives, or have been complicit in manufacturing a “bully list” of negative and destabilizing policies about China, Russia, Venezuela, Iran…countries that have been most resistant to US bully antics.
Certainly, the Washington-Wall Street neoliberal cabal are not the only ones with a “bully list.” Australia has a bully list too, which they are asserting in their Step-Up agenda, deepening their patronage with Pacific Island Countries– particularly governments daring to exert their self-determination to engage in closer relations with China.
While unfounded fears of debt traps and Chinese hegemony are being promoted through misinformation campaigns designed to undermine more fair and equitable infrastructure projects for developing countries, it is the United States that is navigating duplicitous ways for further privatizing our water and ocean resources.
Our Commons or Bust
It was just announced that water futures are about to hit financial markets for the first time with the launch of contracts tied to prices in California. Over the last year, the Nasdaq Veles Water Index monitored water prices rising to over 300%, from $200 per acre-foot, to over $700. While it has recently dropped to about $500, the volatility of water prices is precisely the reason why water futures should never be traded in financial markets.
Just as with other futures markets, where buyers can lock in the prices of tradable goods for the year, well funded investment cabals can create tremendous insecurity by betting on the speculation of market prices and conditions. These conditions around privatization can be manipulated in all kinds of ways depending on what is being traded, and as with water, this can include privatizing rain catchment systems.
In Bolivia’s well known case under the Bechtel contract, it became illegal for city residents or peasants in surrounding communities to collect rainwater for drinking, irrigation, or anything else. Immediately, water prices in some areas rose by 200% when new water laws were enforced. This started the revolution in Bolivia that led to the election of Evo Morales in 2005. (It was just reported that new elections have restored the MAS party after last year’s US-backed coup).
It’s bad enough that free-market economies no longer treat our water distribution as a public utility and have put it in the hands of private corporations or public-private partnerships. Water speculation will drive up the cost of water.
Currently, under the revised North American Free Trade Agreement–now the USMCA– the United States, Canada and Mexico have entered into an agreement that has already put in place water privatization laws in Mexico.
The problem with water speculation is that water is a right and it should never be treated as a commodity. And now that water is being included in financial futures markets, new costs for services and market pricing will begin to influence private sector service companies engaged in delivery, bottling, transport, sanitation, etc, creating public instability over the cost of water.
In finance, derivatives trading is related to the futures market where what is being bought and sold are the offsets of what purchasers agree to pay for specific commodities in the future. California is the fifth largest economy in the world and it has tremendous leverage for setting global water prices. As water becomes more scarce as a result of climate change (as we have seen with the rise of wildfires), the demand for water has become more competitive. New baseline indices for water prices in the global market are going to impact many trade sectors, including meat and dairy, agriculture, and whatever other trade sector that is dependent upon water.
Not knowing all the variables and not having a venue or the means to enforce dispute resolutions should be enough of a reason to walk away from these agreements.
How these prices are set, requires data. There has to be an assessment of how much water there is in fresh water tables and an analysis of the changes and the consumption rates of this water for consumers and industries. Once the data is determined, depending on how water contracts are negotiated, it is likely that national quotas for consumption will be set up and prices will be locked in to current prices so that consumers will not be shocked by a difference in their water rates. But we also do not know what other conditions may arise that could impact the cost of water delivery or other variables that were not addressed in the agreement. Not knowing all the variables and not having a venue or the means to enforce dispute resolutions should be enough of a reason to walk away from these agreements.
While there is nothing wrong with the principle behind derivative trading, per se, there is something terribly wrong with attaching strong financial motivations to a resource that must be regarded as a human right of our global commons. Commodity pricing and derivative trade should never undermine our genuine security, particularly when there is so much disparity between the large economies and Pacific Island Countries.
Where are the “Not for Sale” Agreements?
How has the neoliberal agenda come to privatize, manage, defend, and account for global water? In the Pacific it is through legal regimes contained in bilateral trade agreements like Trade and Investment Framework Agreements like the one just signed between the US and Fiji; or regional agreements like PACER-plus; or through Marine Protected-Area conservation agreements– packages that seem really benign but in truth, weaponizes law to enforce backdoor channels for international investors to cast a wide net for the biggest catch.
It is common in developing countries to see international consultations and workshops provide for top down processes where international organizations try to exploit our consent often as a means to undermine our regional assets.
In the Pacific, UNESCAP is collecting the data through the System of Environmental-Economic Accounts (SEEA, Samoa, Vanuatu, Fiji) which has been promoting “exploratory” programs measuring water, energy, and waste, ostensibly to harmonize with the Sustainable Development Goals. What is worth noting, is that while this is an environmental accounting program measuring data, how this data is being used is not for the genuine security of the Pacific, but for investors and private interests using these same backdoor market access privileges used in trade and investment agreements as many of the 169 targets of the 17 SDGs. For the SEEA, this is a program to “integrate ecosystems and biodiversity values into national and local planning, development processes and poverty reduction strategies, and accounts.”
To be clear, the spirit of both the SDGs and the SEEA are well aligned with genuine global security, but it is through the means of implementation where public-private partnerships are harmonized to privatize our global commons. And as we have seen, the country that has been most active in supporting SDG initiatives without privatization investment schemes has been China through their Belt and Road Initiative. We should keep this in mind when we consider how, both the US and Australia have been most active in pursuing false or exaggerated allegations against China and the BRI.
Trading water in a future’s market, privatizes our water supply by turning it from a public good into a commodity, militarizing our water.
Water is an asset– it is a public asset–and the potential for manipulation in financial markets WILL create tremendous financial insecurity, particularly for countries that do not have the infrastructure capacity to develop its own regulatory or enforcement regime.
Small Pacific Island States do not have strong enforcement mechanisms to challenge transnational crimes, nor does it have the funding capacity to raise these issues in international courts. Without this basic infrastructure, our trade and economic ministers are unable to hold wide consultation with all the current and potential actors.
China’s presence in the Pacific does offer new regional infrastructure and security prospects, particularly for the funding and development of new regional regulatory bodies. However, constructive dialogue on such matters is almost impossible right now because of attempts at keeping China out of the region.
It is noteworthy that ANZUS is the regional security treaty between Australia, New Zealand, and the United States, and while China is a much larger trade partner, Australia and NZ are caught in the intersection between its military alliance with the United States and its robust trade cooperation with China.
As a side note, if we step back and look at what the Hong Kong extradition protests were really about, one would find that these protests had less to do with freedom of speech and was primarily directed at the PRC’s attempt to crack down on the illegal black market money laundering crime syndicate that was centered in Hong Kong’s financial district. Having uncovered the funding of protest organizers by the U.S. National Endowment of Democracy it has become evident that these protests were an opportunity to shift attention away from the financial investigations that have found many of these banks guilty of money laundering.
Why this matters to Pacific Islands is that many of the development and investment abuses attributed to China were really international black market investments that were either out of reach from or flying under the radar of Chinese regulators. These were either from big Hong Kong banks like HSBC or small provincial investment cabals working through Hong Kong banks.
But what the Pacific needs to ask, is why foreign security missions in the Pacific provided little or no enforcement against investment agreement abuse pushed by transnational criminals?
The new Australia-backed Pacific Fusion Centre being established in Vanuatu seems like a proactive attempt to enhance the sharing of information on issues from maritime risks to human trafficking and disinformation. What they should focus on, however, is transnational financial crimes which is probably the most damaging and prevalent criminal activity in the region.
What should be of equal concern is that this move is part of the Pacific Step-Up strategy, which is regarded as a bid to counter China’s growing influence in a region where Australia has traditionally been the largest aid donor.
The very notion of institutionalizing security against disinformation from the government that has been most egregious for manufacturing disinformation as an obstruction policy against China is by definition, a conflict of interest.
Pew, that Stinks: Militarizing Conservation
Marine Protected Areas are another way for the neoliberal countries to privatize and militarize our ecological resources. Last week the Pew Charitable Trusts (conservation funders for Nature Conservancy and WWF) released a Draft Template Law for Countries Sponsoring Seabed Mining Beyond National Jurisdiction. The statement asserts that “adopting robust legislation would help to ensure health of marine environment”, and “consistency among nations.”
The regulatory language that focuses on the controversy around Deep Seabed Mining legislation is also a duplicit sleight of hand to assert the “protect and preserve” conservation agenda that would place the security and management of our region into private ownership. Without stating it directly, Pew’s template law is a privatization agenda of ocean territory in the Areas Beyond National Jurisdiction.
On the one hand, this Template Law promotes the ideals of good governance and environmental protection that one would expect from a conservation group asserting a DSM regulatory scheme. On the other hand it is also a “protection and preservation” scheme that is inextricably tied to both the Department of Defense as well as the dozens of military subcontractors owning the intellectual property, and patents, and profiting from the R&D of the DOD’s environmental research programs (SERDP and ESTCP). These are the very same conservation and resilience technologies that would enhance Pew’s privatization objectives.
In Text Box 74 (p52). Here lies Pew’s objective: ocean data.
“Data and information that is necessary for the formulation by the Authority of rules, regulation and procedures concerning protection and preservation of the marine environment and safety, other than proprietary equipment design data, shall not be deemed confidential.” Concluding with “categories of non-confidential data are also provided, which include, “data and information that […] relate to the protection and preservation of the Marine Environment” [DR89(3)(f)].
Code Project, “Template National Sponsorship Law for Seabed Mining Beyond National Jurisdiction. Text Box 74, P. 51
Under this “Code Project” rule, an applicant may designate information confidential where it is “necessary for the formulation by the ISA of rules, regulations and procedures” concerning the protection and preservation of our marine environment. This raises the possibility that portions of the EIS, not related to rule-making, might be deemed confidential.
In the Code Project sponsorship of certificates and transfer, again a seemingly benign chapter, the liabilities of the DSM contractor are evident, but what about the liabilities of the State, should the State want to depart from not just DSM, but also the entire sponsorship agreement? Pacific Island Countries will barely be able to afford the legal counsel necessary to address this, or to pay for any losses in the legally binding anticipated revenue loss contained in the investment agreement.
When one considers valuing and militarizing conservation, how much do you think all of this will add to the “Preservation Value” of our region?
As much as the minerals of our deep seabeds are being coveted by foreign investment regimes, so is controlling the stewardship of our ocean resources.
Language is important and the drafters of these documents do not have the best interest of our people or our environments. A case in point is that “preservation” is the more robust defender of our environment than “conservation.” Conservation allows for the loosely defined idea of environmental sustainability, whereas preservation has a much wider application for its security and defense.
In this document, preservation is always coupled with “protection”. This is another example of Pew’s slight of hand. Preservation, in the context of the Code Project can be enforced to lock out states and customary peoples from accessing fair use of the area since sponsorship certificates can be transferred from States to foreign managing entities. Additionally, transferring the management of our Marine Protected Areas is also a transfer of our regional ocean data, which would result in a tremendous financial loss for Pacific Island Countries. As an accounting rule, this data can only be accounted for once.
For economic ministers, this should be a warning. The end of this chain leads only to ecological and economic hegemony. We can either account for and control our data resources, or we can surrender them and allow private contractors to control and manage the wealth of our regional assets. As much as the minerals of our deep seabeds are being coveted by foreign investment regimes, so is controlling the stewardship of our ocean resources.
Towards our Ecological Star Line
The point of an ecological accounting model, is to benefit the region, to equalize our region within the global economic space and to put forward an economy that will reverse the negative economic and ecological conditions that have resulted from climate change.
As we know, the dominant industrial economies are the ones responsible for this climate debacle. The way to fix it is to adopt an ecological accounting scheme that will benefit all, not just the Washington-Wall Street investment regime. There are already too many conflicting interests that would seek to remove developing counties from the region. The same powers that invoked colonialism, post-colonialism and neoliberalism, are the very same ones who are now trying to co-opt our ecological accounts.
This is how neoliberalism operates, through a coordinated Washington-Wall Street hustle that often involves the media and the international institutions, in this case, UNESCAP and Pew. The way for the Pacific to stop this, is for the Pacific to ecologically regionalize and adopt a new ecological accounting scheme that ensures Mutual Cooperation. The Pacific Theological College has just published a new book that addresses how we accomplish this– Ecological-Economic Accounts: Towards Intemerate Values. And the Pacific Conference of Churches is beginning to see this as a way for us to navigate towards our own Pacific future.
Our ecological way forward is in view, and the time for our leaders to move us forward is now.
Just as Hanaiakamalama (roughly translated as cared for by the moon or more widely known as the Southern Cross) points the way for Pacific Navigators to traverse our Liquid Continent, Ka Iwikuamo’o or the navigational starline is the backbone. The constellation is shining bright and our ecological way forward is in plain view. Dark clouds are on the horizon and the time for our leaders to move us forward is now.