Foreign investors in weak economies like Botswana tend to favour putting their money in natural resource use and extraction, particularly in the areas of minerals, agriculture and fuel production; products like diamonds, oil, crops, tobacco and vegetables.
The poorest countries in the world still receive a disproportionately large amount of investment flows into their natural resource sectors, oil in Nigeria, diamonds in Botswana, tobacco in Zimbabwe, cash crops in much of west Africa and eastern Africa. Accompanying these investments in the South have also been serious, sometimes large scale tragic, cases of environmental degradation acceleration, deforestation, loss of biodiversity and high greenhouse gas emissions turning FDI areas into desolate wildernesses of pollution, unproductive lands, sicknesses, hunger and poverty traps.
There is no denying the fact that FDI rapidly increases economic activity, and it’s a significant contributor to environmental destruction. African Governments have struggled since self-rule to identify and appropriately respond to the problems of private investment, a struggle now lost to disproportionate attention to only the benefits of FDI.
Big companies move their investments to developing countries where there are less stringent laws on environmental protection, or where such laws may exist but are unenforced or unenforceable, due to institutional weaknesses, corruption or desperate need for foreign capital usually driven by greed for power and wealth by irresponsible and unaccountable elites.
Many African countries, including Botswana, routinely undervalue their environments in order to attract new investments, and foreign investors on their part have too much influence in advocating for, even creating, low environmental standards. We accept that the competition for FDI is intense and complicated, but refuse to endorse the practice of turning poor countries into pollution havens for western corporations greedy for quick cash.
We also accept that macro-level issues like scale of economic activity relative to regulatory capacity are problematic, but refuse to accept the idea that site-specific environmental impacts should be left to the whims of corporate executives or that local communities should be excluded from benefitting from the economic exploitation of areas adjacent to their homes, villages, cattle posts, hunting grounds, ploughing fields, watering points, and settlements.
Unfortunately, this happens far too often in African countries; millions of African peasants, hunter-gatherers, small farmers, cattle herders, and nomadic communities have been displaced from their lands, homes and other proprietary jurisdictions, to give way to foreign investments that disproportionately benefit unproductive urban constituencies and foreign investors.
Why is it that Governments in weak economies are so easily willing to remove restrictions on financial flows in and out of their countries? Why don’t they negotiate corporate contracts with specific, effective and enforceable environmental protection clauses? How beneficial, especially in the long-term, is economic growth that is fuelled by disregard of the natural and social environment, alienating, embittering and harming local communities? What regulatory and market instruments can best be employed to motivate and incentivise transitions to sustainability? Does the proliferation of FDI necessarily guarantee economic development, sustainability, social justice and democracy? Who wants a country owned by foreign investors?
One would think that African Governments would long have realised by now the terrible reality that decisions about the environment are irreversible, that inefficient use of scarce resources does not benefit the future, that this tendency almost always breed national ruin, destruction and underdevelopment in the long-term leading to civil strife, political chaos, even wars.But, no; they haven’t, and it would appear they never will. In Nigeria they executed the Ogoni leaders for raising up such issues. In DRC the state appropriated the entire natural heritage and mortgaged the rural poor to ruthless comprador foreign exploiters and brutal banditry warlords.
But is the problem only confined to poor host country governance? What role can Non State actors , in both home and host countries, play in articulating the interests of those left behind or badly affected by foreign investment? If Governments cannot control the activities of multinationals shouldn’t they perhaps create legal instruments for other players like civil society groups, even individual citizens, to do this job?
The Botswana Minister of Mineral Resources recently argued against legislating foreign investor operations in Botswana, claiming this would amount to multiple taxation in the area of corporate social responsibility, but shouldn’t we perhaps start thinking of legislation empowering individuals, communities and Non State actors to join corporate investment negotiations, and also be part of agencies monitoring their activities, especially the problems of operational overreach and negligent opportunism?
In Botswana right now the mining industry is witnessing a surge in high technological exploration and extraction; both serious threats to environmental depression. Many mines are aging, or already closed. There is political wariness about exclusive foreign involvement in the minerals sector. In fact, the commercial sector as well. There is community pressure for proper regulation, beneficiation and taxation. All the above are serious issues that Botswana Government should be addressing. In the absence of such discussions we should at the very least be encouraging business responsibility across all investment sectors.
Corporates investing in Botswana must take greater responsibility for their operations. We should build our capacity to regulate, oversee and impose minimum standards, not only for corporate social responsibility, but go further to ensure individual companies go beyond the position of corporate responsibility to become active corporate citizens, who actually go out of their way to help raise environmental standards where they operate mines, promoting education and practice in the existing environmental laws, making minerals markets more responsive to local needs, building better and more rewarding relationships with local economies, communities and civil society organizations, and actively aligning their brand designs and cultures to national agendas and visions.
