Thursday, November 29, 2007

Switzerland to Africans: You’re not welcome here, but we may still be able to find a place for your cash

An anti-immigrant Swiss political party has partly funded a television advertising campaign aimed at discouraging Africans from immigrating to Europe. London’s Independent reported that the $370,000 television campaign, currently airing in Nigeria and Cameroon, is also funded by the European Union and International Organisation for Migration.

The adverts carry the message “fleeing does not mean starting a new life” and go something like this:

It starts with a phone ringing in a sparsely furnished home somewhere in Africa. An elderly African picks up the receiver and is shown speaking to his son talking on a public phone from somewhere in Europe while standing in pouring rain.

The father asks if the young man has found accommodation. He says he is staying with friends. Images of an asylum camp under a bridge fill the screen. The son lies to his father that his studies are going well. He is depicted sitting on a kerbstone and begging. Later he is chased and arrested by the police.

Pointing out that an estimated 10,000 Africans have perished trying to flee to Europe, an IOM spokesman says the advertisement is designed to save lives.

These guys are in the wrong field
A row broke out over the ads, but not about their content. Rather, it came out that the ads were partly funded by the Swiss Migration Office, which is controlled by Justice Minister Christoph Blocher, who’s Swiss People’s Party hold the country’s largest-ever majority in Parliament. They won by running a patently anti-immigrant campaign, replete with campaign ads depicting “white sheep standing on a Swiss flag kicking a black sheep from their midst. The slogan accompanying the image was ‘More Security.’”

How ironical
For the blogger, it would be weak and painfully obvious to point out that it’s only natural for the Swiss to attempt to dissuade Africans from moving to their country when African money of questionable provenance has long found a welcoming home in Swiss banks. It was these storied international lending institutions that long provided the necessary discreetness demanded by well-heeled African leaders. In 1999, the Economist estimated that Swiss Banks held $20 billion of stolen wealth from African nations. In 2000, a Nigerian super-computer scientist claimed that one-third of Africa’s capital flight has found a home in Switzerland.

From the standpoint of shady African leaders, using Swiss Banks only made sense. Once the money is safely deposited into Swiss bank accounts, it’s hard to pry it loose. When Liberian strongman Samuel Doe was captured by Charles Taylor’s forces he refused to divulge his Swiss bank accounts because he know they were going to kill him anyway. Taylor never saw any of Doe’s money. It famously took Swiss bankers 18 years to return $500 million stolen from Filipino Dictator Ferdinand Marcos. The government of Nigeria only had to wait five years to recoup some of the $700 million pilfered from Sani Abacha.

For the Government of Congo-Kinshasa, trying to recover even a portion of Mobutu Sese Seko’s ill-gotten gains must have felt like a riding a rodeo horse. First the Swiss claimed none of their banks held Mobutu’s money; then the banks said they’d look again; then they found only $3.4 million, and shortly afterwards a $5.5 million 30-room mansion turned up. The Congolese government asked for the paltry $3.4 million (out of an estimated $7.7 billion Mobutu bilked), but Swiss bankers warned the process could take years.

Smoke on the water
For simplicity sake let’s say Mobutu’s and Doe’s and Abacha’s money was stolen. That’s money not going to pay for schools, build latrines or support other fuzzy-feeling development projects. That’s cash that won’t circulate through African economies – because military dictators must pay for food and hire maids and cooks, too. The billions holed up in Swiss bank accounts represents funds African banks can’t loan.

Now, let’s say that some rich African businessmen may be parking some of their hard-earned cash into Swiss banks because the high security standards provided by a Western bank. If so, that’s money African governments won’t collect taxes on, and the Swiss are still famously tight-lipped regarding illegal tax havens. For the sake of debate, let’s claim that these funds were actually gained by imaginative bookkeeping, which some people refer to as money laundering, and the Swiss have also been quite reluctant to look into that.

The first line of defense
Until now, it appears. Following revelations of Holocaust victims’ life savings becoming covered in cobwebs in Swiss vaults, the realities of following-the-money in the post-9/11 world, combined with the fact that African states still lose 25 percent of GDP to corruption, the World Bank has launched the Stolen Asset Recovery Initiative.

Its goal: “To encourage rich countries to return the loot and for developing countries to properly invest the recovered funds in social and anti-poverty programs,” says Reuters.

Switzerland jumped in to be the first nation to pledge its help and promise to cooperate with poor countries regarding the recovery of stolen assets. "There have been changes in the behavior of some like the Swiss, who understand that it's not good for the reputation of major financial institutions, to say nothing of countries, to be associated with billions of dollars of stolen funds from corrupt leaders in poor countries,” World Bank President Robert Zoellick told Reuters.

This is not an abrupt turn of face. Switzerland has spent much of the past decade trying to tighten its banking rules. This is especially true when high-profile bad people are involved. In 2001 Swiss prosecutors froze eight accounts totaling $70 million of Peruvian spy Vladimiro Montesinos. In 2002, Swiss authorities placed a donor for Britain’s ruling Labour party under investigation for an alleged money-laundering scheme involving funds stolen by Nigeria’s Sani Abacha.

From a 2001 Salon story:

Human rights experts say the role of Switzerland and other countries in increasing scrutiny of bank accounts is one major pressure putting the squeeze on corrupt tyrants who formerly funneled money abroad.

An official with a wing of the U.S. Treasury that investigates money laundering praises this new vigilance. "Switzerland used to be synonymous with dirty banking," Will Wechsler, special advisor to former U.S. Treasury Secretary Lawrence Summers, said in an interview. "Now it has a fairly good anti-money-laundering regime, especially in terms of high-profile money-laundering figures." In fact, he says, "Banks are often the first line of defense."

Back to the weak and obvious
Like I said, it would be weak and obvious to bring this stuff up. Switzerland has some time ago turned a corner regarding their fierce clinging to stolen money. In their part, African governments have mostly forgiven and forgotten. They hope the initiative will be a deterrent to corrupt officials in the future.

This may be a little off topic for Africa Flak, but the Swiss are not the xenophobes one could make them out to be. The famous Swiss People’s Party only garnered 29 percent of the vote in October’s election. For all the immigrant worries, roughly 24 percent of Switzerland’s population has been born elsewhere – and it’s a population that appears to be very educated and skilled.

It would be naive to say that if even a small percentage of those funds shamelessly protected by the Swiss had never left Africa, there would be no need for an anxiety-laden advertising campaign. On the other hand, it’s more than a little cynical for the country’s banking institutions to wash their collective hands of the whole mess. One could argue that what the television ads are about. No amount of PR will provide enough deterance to potential immigrants. But a few advertisements may wash away a little culpability.

The people crossing the Mediterranean are merely exploiting a need, looking for work in countries that apparently don't want them, but whose people will learn they can't live without them. Capitalists have always insisted the market knows no morals. In this case, the market wasn't protecting the funds of criminals; Switzerland’s banking technocrats were, and the rest of the country profited. Who, then, are the real sheep in this story?

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