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Trade, Aid and Security: an Agenda for Peace and Development 1 Duncan Brack Trade, Aid and Security Trade, Aid and Security An Agenda for Peace and Development Edited by Oli Brown, Mark Halle, Sonia Peña Moreno and Sebastian Winkler EAR THSCAN London • Sterling, VA First published by Earthscan in the UK and USA in 2007 Copyright © IISD and IUCN, 2007 All rights reserved ISBN-13: 978-1-84407-419-8 (paperback) ISBN-13: 978-1-84407-420-4 (hardback) Typeset by JS Typesetting Ltd, Porthcawl, Mid Glamorgan Printed and bound in the UK by Cromwell Press, Trowbridge Cover design by Susanne Harris Front cover image ‘After the War, Angola 2002’ by Amelia Bookstein Back cover image ‘Carrying Water, Thyolo, Malawi 2002’ by Amelia Bookstein For a full list of publications please contact: Earthscan 8–12 Camden High Street London, NW1 0JH, UK Tel: +44 (0)20 7387 8558 Fax: +44 (0)20 7387 8998 Email: [email protected] Web: www.earthscan.co.uk 22883 Quicksilver Drive, Sterling, VA 20166-2012, USA Earthscan is an imprint of James and James (Science Publishers) Ltd and publishes in association with the International Institute for Environment and Development A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data Trade, aid, and security : an agenda for peace and development / edited by Oli Brown . [et al.]. p. cm. ISBN-13: 978-1-84407-420-4 (hardback) ISBN-10: 1-84407-420-X (hardback) ISBN-13: 978-1-84407-419-8 (pbk.) ISBN-10: 1-84407-419-6 (pbk.) 1. Peace–Economic aspects. 2. Economic development–International cooperation. 3. International trade–Political aspects. 4. Economic assistance–International cooperation. 5. Security, International–Economic aspects. I. Brown, Oli. JZ5538.T73 2007 338.9–dc22 2006100474 This publication is printed on FSC certified totally chlorine-free paper. FSC (the Forest Stewardship Council) is an international network to promote responsible management of the world’s forests. Contents List of Tables and Boxes vii The World Conservation Union and the International Institute for Sustainable Development viii List of Contributors x Acknowledgements xii Foreword xiii List of Acronyms and Abbreviations xvii Introduction: Trade, Aid and Security: An Agenda for Peace and Development 1 Duncan Brack 1 Designing Conflict-sensitive Trade Policy 18 Mark Curtis 2 Developing Conflict-sensitive Aid: The Relationship between Aid and Conflict 41 Ian Smillie 3 Promoting ‘Good’ Governance through Trade and Aid: Instruments of Coercion or Vehicles of Communication? 72 Oli Brown 4 Building Markets for Conflict-free Goods 92 Duncan Brack and Gavin Hayman 5 Promoting Conflict-sensitive Business in Fragile States: Redressing Skewed Incentives 126 Karen Ballentine 6 Managing Revenues from Natural Resources and Aid 158 Richard Auty and Philippe Le Billon vi Trade, Aid and Security: An Agenda for Peace and Development Conclusion: Prospects for Peace and Progress 190 Mark Halle Index 198 List of Tables and Boxes Tables 4.1 Dynamics affecting three natural resources and their relationship to conflict 104 4.2 UN sanctions on conflict commodities 105 6.1 Structure of GDP and employment in Algeria, 1999 165 6.2 PWYP and EITI compared 180 Boxes 6.1 The UN Oil-for-Food programme in Iraq 167 6.2 Revenue management laws in conflict-affected countries 171 The World Conservation Union and the International Institute for Sustainable Development The World Conservation Union Founded in 1948, The World Conservation Union (IUCN) brings together states, government agencies and a diverse range of non-governmental organi- zations (NGOs) in a unique world partnership: over 1000 members in all, spread across some 140 countries. As a union, IUCN seeks to influence, encourage and assist societies throughout the world to conserve the integrity and diversity of nature and to ensure that any use of natural resources is equitable and ecologically sustainable. IUCN builds on the strengths of its members, networks and partners to enhance their capacity and to support global alliances to safeguard natural resources at local, regional and global levels. International Institute for Sustainable Development The International Institute for Sustainable Development (IISD), based in Winnipeg, Canada, contributes to sustainable development by advancing policy recommendations on international trade and investment, economic policy, climate change and energy, measurement and assessment, and sustainable natural resources management. Through the internet, we report on interna- tional negotiations and share knowledge gained through collaborative projects with global partners, resulting in more rigorous research, capacity building in developing countries and better dialogue between north and south. IISD’s vision is better living for all – sustainably; its mission is to champion innovation, enabling societies to live sustainably. IISD is registered as a charitable organization in Canada and has 501(c)(3) status in the US. IISD receives core operating support from the Government of Canada, provided through the Canadian International Development Agency (CIDA), the International The IUCN and the IISD ix Development Research Centre (IDRC) and Environment Canada, and from the Province of Manitoba. The Institute receives project funding from numerous governments inside and outside Canada, United Nations’ agencies, foundations and the private sector. Visit www.iisd.org for more information. List of Contributors Richard Auty is Emeritus Professor of Economic Geography at Lancaster University. He previously taught at Dartmouth College and was a visiting fellow at the Institute of Development Studies (Sussex), Harvard Institute for International Development, Resources for the Future and the Woodrow Wilson School, Princeton. Lloyd Axworthy is President and Vice Chancellor of the University of Winnipeg. Formerly Director and CEO of the Liu Institute for Global Issues at the University of British Columbia, and Canada’s Foreign Minister from 1995 to 2000, Lloyd Axworthy’s political career spanned 27 years, 6 of which he served in the Manitoba Legislative Assembly and 21 in the Federal Parliament. In 1997 he was nominated for the Nobel Peace Prize for his work on banning land mines. Karen Ballentine is an independent consultant on the political economy of armed conflict. In 2004–05, she was Senior Consultant for the Fafo Institute for Applied International Studies. From 2000 to 2003, she directed the Economic Agendas in Civil Wars Program at the International Peace Academy. Duncan Brack is an Associate Fellow of the Energy, Environment and Development Programme at Chatham House (the Royal Institute of International Affairs) in London in the UK, where he works mainly on illegal trade in natural resources. From 1998 to 2003, he was Head of the Programme, and from 1995 to 1998 a Senior Research Fellow at Chatham House, working on trade and environment issues. Oli Brown is the coordinator of IISD–IUCN’s Trade, Aid and Security initiative. After two years in Nepal managing education and conservation projects, Oli worked as a trade policy researcher for Oxfam GB. He has completed consultancies for the United Nations Development Programme (UNDP), New Zealand’s International Aid and Development Agency (NZAID) and International Alert and has worked on a wide range of trade, environment and sustainable development issues. List of Contributors xi Mark Curtis is currently an independent author, journalist and consultant. He is a former Research Fellow at Chatham House (the Royal Institute of International Affairs) and was until recently Director of the World Develop- ment Movement. Mark Halle directs IISD’s global programme on trade and investment as well as its European office in Geneva, Switzerland. He serves as a Senior Advisor to IUCN and runs the trade activities of the International Institute for Environment and Development’s (IIED) Regional and International Networking Group. He is founder and former Chairman of the Board of the International Centre for Trade and Sustainable Development. Gavin Hayman is an investigator and campaigner with Global Witness based in London, UK. He has contributed substantially to Global Witness’ work on oil, gas and mining, and the linkages between natural resources and conflict. Philippe Le Billon is Assistant Professor at the University of British Columbia, Department of Geography and Liu Institute for Global Issues. Holding an MBA and DPhil in Geography, he previously worked with the Overseas Development Institute and the International Institute for Strategic Studies on humanitarian and resource management issues. Sonia Peña Moreno works at the Policy, Biodiversity and International Agreements Unit of IUCN. Her work as Policy Officer is related to issues of environmental governance, IUCN’s general policy and environmental policy at the multilateral level. Ian Smillie is an Ottawa-based development consultant and writer. He serves as Research Coordinator on Partnership Africa Canada’s ‘Diamonds and Human Security Project’ and is an NGO participant in the intergovernmental ‘Kimberley Process’, which is developing a global certification system for rough diamonds. Sebastian Winkler is Senior European Policy Officer and Head of the Countdown 2010 Secretariat at IUCN. Acknowledgements This book is the culmination of a four-year research collaboration between the IISD and the IUCN. It could not have been completed without the help and support of many valued colleagues and friends. From the beginning, the direction and scope of our research has been guided by a dedicated and talented advisory group
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