Category Archives: Markets

To Steal To Survive: the Illegal Lumberjacks of the Amazon

The Amata logging company was supposed to represent an answer to the thorny problem of how countries like Brazil can take advantage of the Amazon rainforest without widespread deforestation.  But after spending tens of millions of dollars since 2010 to run a 178-square-mile concession in the rainforest to produce timber sustainably, Amata pulled out in April 2020. The reason: uncontrolled wildcat loggers who invaded Amata’s land, illegally toppling and stealing trees.

Amata’s executives in São Paulo said that instead of promoting and protecting legal businesses, Mr. Bolsonaro’s administration did next to nothing to control the illegal loggers who invaded the concession in the western state of Rondônia. “It’s a conflict area,” Amata Chief Executive Ana Bastos said of the land granted to the company. “Those lumberjacks steal our lumber to survive. If we try to stop them, they will fight back. It will be an eternal conflict.”

Since they pay no taxes and make no effort to protect certain species or invest in restoration, illegal loggers can charge $431 per square meter of lumber, compared with $1,511 per square meter of legally logged timber, concession operators said.  “It is like having a regular, taxpaying shop competing with lots of tax-free peddlers right in front of your door,” said Jonas Perutti, owner of Lumbering Industrial Madeflona Ltda., which also operates concessions in the Amazon…

“The organized crime that funds illegal activity in the Amazon—including deforestation, land grabbing, lumber theft and mining—remains strong and active,” said Carlos Nobre, a Brazilian climate scientist. “It seems [the criminals] aren’t frightened by the government’s zero-tolerance rhetoric or don’t believe it’s serious.”…

Wildcat loggers are among the Amazon’s poorest residents, and many feel they have an ally in Mr. Bolsonaro,[Brazil’s President]…“There’s much corruption in law enforcement, and consumers don’t care if the wood they are buying is legal or not,” said Oberdan Perondi, a co-owner of a concession that is five times as large as Amata’s and also competes with illegal loggers.

Excerpt from Paulo Trevisani and Juan Forer, Brazil Wanted to Harvest the Amazon Responsibly. Illicit Loggers Axed the Plan, WSJ, Oct. 28, 2020

The Unrepentant Banker: How Banks Rig the Markets

Many of the big market-manipulation scandals over the past decade have much in common: huge fines for the investment banks, criminal charges for the traders and an embarrassing paper trail revealing precisely what bank employees got up to. Interest-rate traders who manipulated the London Interbank Offered Rate (LIBOR)… infamously called a chat room in which they discussed rigging exchange rates “the cartel”.

The case against JPMorgan Chase for manipulating precious-metals and Treasury markets has many of the usual features. On September 29th, 2020 it admitted to wrongdoing in relation to the actions of employees who, authorities claim, fraudulently rigged markets tens of thousands of times in 2008-16. The bank agreed to pay $920m to settle various probes by regulators and law enforcement… Some of the traders involved face criminal charges. If convicted, they are likely to spend time in jail.

The traders are alleged to have used “spoofing”, a ruse where a market-maker seeking to buy or sell an asset, like gold or a bond, places a series of phony orders on the opposite side of the market in order to confuse other market participants and move the price in his favor. A trader trying to sell gold, for instance, might place a series of buy orders, creating the illusion of demand. This dupes others into pushing prices higher, permitting the trader to sell at an elevated price. Once accomplished, the trader cancels his fake orders… According to prosecutors one JPMorgan trader described the tactic as “a little razzle-dazzle to juke the algos”. In the past two years Deutsche Bank, HSBC, Merrill Lynch and UBS have all paid penalties on spoofing charges…

Excerpt from Spoof proof: JPMorgan Chase faces a fine of $920m for market manipulation, Economist, Oct. 3, 2020

Paper Parks, their Elephants and Marginal People

Since 2010 Chad has taken a step that other African countries are increasingly following. It handed management of its national park to an NGO. Since African Parks took over, the elephant population has begun to rise. In 2011 just one calf was born; in 2018, 127 were. The revival is emblematic of broader success that public-private partnerships (PPPs) are having in conserving some of the most precious parts of the planet.  Sixty years ago, when decolonization was sweeping the continent, the UN counted 3,773 “protected areas” in Africa and its surrounding waters. By 1990 the figure was 6,075; today it is 8,468. Some 14% of the continent’s land has been categorized as protected, according to the World Database on Protected Areas…

Most “protected areas” are “paper parks”, argues Peter Fearnhead, the chief executive of African Parks. In theory their demarcation denotes stewardship; in practice there is often very little care. Since its founding in 2000 the NGO has grown to manage 19 parks in 11 countries. It is the largest of an expanding number of ppp operators across the continent. The African Parks model relies on “three ms”, explains Mr Fearnhead: a clear mandate from a government (which keeps ownership of the area but hands over the running to the NGO); sound management; and money from donors such as the EU.

Zakouma is African Parks’ flagship operation. When it took over its management the priority was security. The national park was caught up in Chad’s civil conflicts in the 2000s, when rebel groups, some backed by Sudan, took on government forces. Janjaweed militias, notorious for mass murder and rape in Darfur, took advantage of the vacuum to slaughter Zakouma’s elephants and launch attacks on nearby villages.
The approach to security is a blend of low and high tech. It relies on residents of surrounding areas to alert it to poachers. Local intelligence is then combined with satellite tracking of the elephants. This helps anti-poaching rangers to know where to go.

Winning the support of people on the edge of the park has been crucial. Locals are happy to help report sightings of the Janjaweed, since they fear being robbed or murdered by them. African Parks also negotiates with nomads to ensure their caravans of camels do not go through the park.

Excerpts from Elephants’ graveyard no more: African governments are outsourcing their natural areas, Economist, Oct. 22, 2020

Modern Slavery and the Collapse of Fisheries

Illegal, unreported and unregulated fishing accounts for a staggering 20-50% of the global catch. It is one reason fish stocks are plummeting: just a fifth of commercial species are sustainably fished. Illegal operators rob mostly poor coastal states of over $20bn a year and threaten the livelihoods of millions of small fishermen. A huge amount of illicit fishing happens on licensed boats, too. They might catch more than their quota, or falsely declare their catch as abundant albacore tuna instead of the more valuable bigeye. In port fisheries inspectors are always overstretched. If an operator is caught, for instance, fishing with too fine a net, the fine and confiscation are seen as a cost of doing business. Many pay up and head straight back out to sea.

The damage from illicit fishing goes well beyond fish stocks. Operators committing one kind of crime are likely to be committing others, too—cutting the fins off sharks, or even running guns or drugs. Many are also abusing their crews… A lot of them are in debt bondage…. Unscrupulous captains buy and sell these men and boys like chattel

Too often, the ultimate beneficiaries of this trade are hard to hook because they hide behind brass-plate companies and murky joint ventures. Pursuing them requires the same kind of sleuthing involved in busting criminal syndicates. An initiative led by Norway to go after transnational-fisheries crime is gaining support. Much more cross-border co-operation is needed.

At sea, technology can help. Electronic monitoring promises a technological revolution on board—Australian and American fleets are leading the way. Cameras combined with machine learning can spot suspicious behavior and even identify illicit species being brought on board…. Equally, national regulators should set basic labor standards at sea. If countries fail to follow the rules, coastal states should bar their fishing fleets from their waters. Fish-eating nations should allow imports only from responsible fleets.

Above all, governments should agree at the World Trade Organization to scrap the subsidies that promote overfishing. Of the $35bn a year lavished on the industry, about $22bn helps destroy fish stocks, mainly by making fuel too cheap. Do away with subsidies and forced labor, and half of high-seas fishing would no longer be profitable. Nor would that of China’s environmentally devastating bottom-trawling off the west African coast. 

Excerpt from Monsters of the deep: Illicit fishing devastates the seas and abuses crews, Economist, Oct., 22, 2020

What really happens in the seas? GlobalFishing Watch, Sea Shepherd, Trygg Mat Tracking

Just Forbid It – Fishing: Fishing and Marine Protected Areas

Fish, whether wild caught or farmed, now make up nearly a fifth of the animal protein that human beings eat….In this context, running the world’s fisheries efficiently might seem a sensible idea. In practice, that rarely happens. Even well-governed coastal countries often pander to their fishing lobbies by setting quotas which give little respite to battered piscine populations. Those with weak or corrupt governments may not even bother with this. Deals abound that permit outsiders legal but often badly monitored access to such countries’ waters. And many rogue vessels simply enter other people’s fishing grounds and steal their contents.

There may be a way to improve the supply side: increase the area where fishing is forbidden altogether.  This paradoxical approach, which involves the creation of so-called marine protected areas (MPAs), has already been demonstrated on several occasions to work locally. A new study “A global network of marine protected areas for food “in the Proceedings of the National Academy of Sciences…explores the idea of extending MPAs elsewhere. If the right extensions are picked designating a mere 5% more of the world’s oceans as MPAs—which would triple the area protected—could increase the future global catch of the 811 species they looked at by more than 20%. That corresponds to an extra 10m tonnes of food a year.

The idea that restricting fishing would permit more fish to be caught may seem counterintuitive, but the logic is simple. Fish in MPAs can grow larger than those at constant risk of being pulled from the ocean. Larger fish produce more eggs. More eggs mean more fry. Many of these youngsters then grow up and move out of the safe zone, thus becoming available to catch in adjoining areas where fishing is permitted…

MPAs are especially beneficial for the worst-managed areas, most of which are tropical—and in particular for overfished species…They also have the virtue of simplicity. The setting of quotas is open to pressure to overestimate of how many fish can safely be caught…This is difficult enough for countries with well-developed fisheries-research establishments. For those without such it is little more than guesswork…Setting the rules for an MPA is, by contrast, easy. You stick up a metaphorical sign that says, “No fishing”. Knowing who is breaking the rules is easy, too. If your gear is in the water, you are fishing illegally.

Excerpt from Fishing: Stopping some fishing would increase overall catches. Economist, Oct. 31, 2020

The Industrial Chicken and the US-China Rivalry

Animal diseases, the US-China trade war and covid-19 have all disrupted, or threatened to disrupt, industrial chicken supplies and supply chains…The unsentimental logic of high-performance poultry-rearing is easy to grasp. “White-feather meat chickens”, as they are known in China, grow to 2.5kg in 40 days. Homegrown varieties of “yellow-feather chicken”, descended from backyard fowl, take twice as long to mature and will only ever weigh half as much…

Half a century ago meat in China was a rare luxury. Now, many see it as a daily necessity. In the meantime, the country’s supplies of farmland and clean water have not grown. Agriculture remains blighted by food-safety scandals, the rampant use of fake or illegal animal medicines, and disease outbreaks. Small surprise, then, that Chinese leaders give frequent speeches about food security. A puzzle lurks, though. Leaders also call for self-reliance in key technologies. And in the case of broiler chickens, those two ambitions—rearing meat efficiently and avoiding dependence on imports—are in tension.

The chicken imported into China are the fifth-generation descendants of pedigree birds whose bloodlines represent 80 years of selection for such traits as efficient food-to-meat conversion, rapid growth, strong leg bones and disease resistance. After waves of consolidation, the industry is dominated by two firms, Aviagen (based in Alabama and owned by the ew Group of Germany) and Cobb (owned by Tyson, an American poultry giant).

The most valuable pedigree birds never leave maximum-security farms in America and Britain: a single pedigree hen may generate 4m direct descendants. Their second-generation offspring are flown to breeding sites dispersed between such places as Brazil, Britain and New Zealand, in part to hedge against supply shocks when avian influenzas and other diseases close borders. Day-old third-generation chicks are air-freighted to Jinghai Poultry, a company in China, and other places, which spend six months growing them and breeding them in climate-controlled, artificially lit indoor facilities. In all, China imports 1.6m third-generation white-feather chicks a year.

Jinghai  Poultry hatches 8m fourth-generation, “parent stock” chickens annually. The company sells some to other agri-businesses. It breeds from the rest to produce fifth-generation chicks. These are “meat chickens”, consumed in fast-food outlets, schools and factory canteens, or as chicken parts sold in supermarkets. Yellow-feather chickens, deemed tastier by Chinese cooks, account for most whole birds sold in markets.

Chinese breeders have long tried to create local varieties with bloodlines available in-country… In September 2019, the State Council, China’s cabinet, issued a paper on livestock-rearing that set self-sufficiency in poultry as a goal, calling meat-chicken breeding a priority. Big foreign firms have resisted appeals from officials to send second-generation stock to China….Dependence on foreign bloodlines does carry risks. For several months recently New Zealand was one of the only countries able to send third-generation chicks to China, after other exporters suffered bird-flu outbreaks.

Li Jinghui, president of the China Broiler Alliance, an industry association, calls conditions ripe for China’s “brilliant” scientists to develop local birds… But to develop a domestic breed from scratch would take years, and if it does not meet market needs, a firm could spend a fortune “without much to show for it”…Without a stronger animal-health system and environmental controls, biotechnology alone cannot help China to develop world-class agriculture. Moreover, a long-standing Chinese strategy—bullying foreign firms to hand over intellectual property—is counter-productive now.

Excerpts from High-tech chickens are a case study of why self-reliance is so hard, Economist, Oct. 31, 2020

Lots of Money Forever for Waste that Lasts for Forever: Nuclear Waste in Japan

Since August 2020, two local governments on the western shore of Hokkaido in Japan have said they will apply to the central government for a survey that could eventually lead to their municipalities hosting a permanent underground repository for high-level radioactive waste. The fact that these two localities made their announcements about a month apart and are situated not far from each other was enough to attract more than the usual media attention, which revealed not only the straitened financial situations of the two areas, but also the muddled official policy regarding waste produced by the country’s nuclear power plants.

The respective populations of the two municipalities reacted differently. The town of Suttsu made its announcement in August 2020, or, at least, its 71-year-old mayor did, apparently without first gaining the understanding of his constituents, who, according to various media, are opposed to the plan…. Meanwhile, the mayor of the village of Kamoenai says he also wants to apply for the study after the local chamber of commerce urged the village assembly to do so in early September 2020. TBS asked residents about the matter and they seemed genuinely in favor of the study because of the village’s fiscal situation. Traditionally, the area gets by on fishing — namely, herring and salmon — which has been in decline for years. A local government whose application for the survey is approved will receive up to ¥2 billion in subsidies from the central government… Kamoenai, already receiving subsidies for nuclear-related matters. The village is 10 kilometers from the Tomari nuclear power plant, where some residents of Kamoenai work. In exchange for allowing the construction of the plant, the village now receives about ¥80 million a year, a sum that accounts for 15 percent of its budget. According to TBS, Kamoenai increasingly relies on that money as time goes by, since its population has declined by more than half over the past 40 years.

Since Japan’s Nuclear Waste Management Organization started soliciting local governments for possible waste storage sites in 2002, a few localities have expressed interest, but only one — the town of Toyo in Kochi Prefecture — has actually applied, and then the residents elected a new mayor who canceled the application. The residents’ concern was understandable: The waste in question can remain radioactive for up to 100,000 years.

The selection process also takes a long time. The first phase survey, which uses existing data to study geological attributes of the given area, requires about two years. If all parties agree to continue, the second phase survey, in which geological samples are taken, takes up to four years. The final survey phase, in which a makeshift underground facility is built, takes around 14 years. And that’s all before construction of the actual repository begins.

Neither Suttsu nor Kamoenai may make it past the first stage. Yugo Ono, an honorary geology professor at Hokkaido University, told the magazine Aera that Suttsu is located relatively close to a convergence of faults that caused a major earthquake in 2018. And Kamoenai is already considered inappropriate for a repository on a map drawn up by the trade ministry in 2017.

If the Nuclear Waste Management Organization’s process for selecting a site sounds arbitrary, it could reflect the government’s general attitude toward future plans for nuclear power, which is still considered national policy, despite the fact that only three reactors nationwide are online.

Japan’s spent fuel is being stored in cooling pools at 17 nuclear plants comprising a storage capacity of 21,400 tons. As of March 2020, 75 percent of that capacity was being used, so there is still some time to find a final resting place for the waste. Some of this spent fuel was supposed to be recycled at the Rokkasho Reprocessing Plant in Aomori Prefecture, but, due to numerous setbacks, it doesn’t look as if it’s ever going to open, so the fuel will just become hazardous garbage.

According to some, the individual private nuclear plants should be required to manage their own waste themselves. If they don’t have the capacity, then they should create more. It’s wrong to bury the waste 300 meters underground because many things can happen over the course of future millennia. The waste should be in a safe place on the surface, where it can be readily monitored.  However, that would require lots of money virtually forever, something the government would prefer not to think about, much less explain. Instead, they’ve made plans that allow them to kick the can down the road for as long as possible.

Excerpt from PHILIP BRASOR, Hokkaido municipalities gamble on a nuclear future, but at what cost? Japan Times, Oct. 24, 2020

How to Exploit the Secrets of the Ocean: DARPA

PARC, A Xerox Company, announced on October 22, 2020,  it has been awarded a contract by the Defense Advanced Research Projects Agency (DARPA) for the next development phase in the Ocean of Things. Initially announced by DARPA in 2017, the Ocean of Things project is deploying small, low-cost floats in the Southern California Bight and Gulf of Mexico to collect data on the environment and human impact. This includes sea surface temperature, sea state, surface activities, and even information on marine life moving through the area.

Xerox Ocean Float is Equipped with Camera, GPS and other sensors. Ocean of Things

“Oceans cover more than 70 percent of the earth’s surface, but we know very little about them,” said Ersin Uzun, vice president and general manager of the Internet of Things team at Xerox. “The floats gather data that we could never track before, enabling persistent maritime situational awareness.” Each solar-powered drifter has approximately 20 onboard sensors, including a camera, GPS, microphone, hydrophone, and accelerometer. The different  sensors can provide data for a broad array of areas including ocean pollution, aquafarming and transportation routes…Among other things, the float needed to be made of environmentally safe materials, be able to survive in harsh maritime conditions for a year or more before safely sinking itself, and use advanced analytic techniques to process and share the data gathered…PARC built 1,500 drifters for the first phase of the project and will deliver up to 10,000 that are more compact and cost-effective for the next phase. 

Excerpt from DARPA Awards PARC Contract to Expand Ocean Knowledge, XEROX Press Release, Oct. 22, 2020

The Unbankables: Fossil-Fuel Companies

Defenders of the oil-and-gas industry in Washington are fighting back against big banks who want to stop financing new Arctic-drilling projects, fearing it could be a harbinger of an unbankable future for fossil-fuel companies. Five of the six largest U.S. banks— Citigroup, Goldman Sachs,  JPMorgan Chase, Morgan Stanley, and Wells Fargo have pledged over the past year to end funding for new drilling and exploration projects in the Arctic.  Alaska Sen. Dan Sullivan has been lobbying the Trump administration to examine whether the federal government can prevent banks from cutting off financing.

“That these banks would discriminate against one of the most important sectors of the U.S. economy is absurd,” Mr. Sullivan said in an interview. “I thought it was important to push back.” The American Petroleum Institute, one of industry’s most influential lobbying groups, has said it is working with the Trump administration on the issue, which it called a “bad precedent.” API, Mr. Sullivan and others have also suggested the White House should examine whether it could cut off the banks’ access to funding under coronavirus relief packages.

Wall Street has been pulling back from the oil-and-gas industry after years of dismal returns from it and is under increasing pressure from environmentalists and others to limit fossil-fuel lending. While broader market conditions during the coronavirus pandemic this year have dried up capital for new exploration, some analysts have said a lack of bank financing could deter drilling in the Arctic National Wildlife Refuge, which the administration opened to exploration in August 2020…

Capital flight remains one of the primary risks facing the oil industry, according to Moody’s Corp. If the world were to accelerate a transition to renewable sources of energy, oil-and-gas reserves could become uneconomic and turn into a credit liability for producers, making it difficult to access longer-maturity loans, Moody’s said.

Alaska’s economy is almost entirely dependent on the fossil-fuel industry, which has historically funded about 90% of the state’s general fund through tax revenues. Energy executives worry the pledges that banks are making could spread to other regions and parts of the industry as pressure mounts from environmental groups, and companies face the prospect of tighter government regulations. This week, JPMorgan pledged to push clients to align with the Paris climate accord and work toward global net zero-emissions by 2050.

“If it is successful, why would they stop with the Arctic?” said wildcatter Bill Armstrong, founder of Armstrong Oil & Gas Inc., which has discovered more than 3 billion barrels of oil in Alaska. “A lot of misguided people are trying to make oil and gas the new tobacco.

Excerpt from Christopher M. Matthews and Orla McCaffrey, Banks’ Arctic Financing Retreat Rattles Oil Industry, WSJ, Oct. 9 2020

The $1Million Narco-Submarines

South America is awash with cocaine, and traffickers are turning to new ways of getting it to Europe…. Submarines that carry illicit drugs dubbed ‘narco-subs’ are described as low-tech, uncomfortable and hazardous, earning them the nickname ‘water coffins.’

Narco-subs have ferried cocaine from Colombia to Central America since the 1990s and recently proliferated. Rarely true submarines, they are generally semisubmersibles that float mostly but not completely below the waterline and are nearly undetectable. Most are built out of sight in South American jungles for around $1 million a piece. The discovery of a narco-sub, in November 2019,  off Spain’s northwestern coast, according to law-enforcement officials, was the first confirmation of rumors that such a vessel could reach Europe.

Excerpt from James Marson, Narco-Submarine’ Caught After Crossing the Antic,  WSJ, Oct. 18, 2020

Turtle Eggs Can Fool Poachers

The InvestEGGator is used to reveal illegal trade networks and better understand what drives sea turtle egg poaching. The scientists deployed around a hundred of the fake eggs in sea turtle nests across four beaches in Costa Rica and waited. Each egg contained a GPS transmitter set to ping cell towers every hour, which would allow scientists to follow the InvestEGGator eggs on a smartphone app…Five of the deployed eggs were taken by unsuspecting poachers. The shortest route was roughly a mile, but one InvestEGGator traveled more than 80 miles, capturing what researchers were hoping for: the complete trade route, from the beach to the buyer. “Having that moment where the trade chain was complete….that was obviously a very big moment,” says Pheasey.

The InvestEGGator was the invention of Kim Williams-Guillén… The trick, says Williams-Guillén, was designing a device that looked and felt like a sea turtle egg while being precise enough to reveal trade routes. Sea turtle eggs are the size of ping pong balls, but unlike brittle chicken eggs, their shell is leathery and pliable. “Making [the trackers] look like eggs from far away was not going to be an issue, it was more making them feel like turtle eggs,” says Williams-Guillén. “One of the ways that [poachers] know that a turtle egg is good when they’re sorting their eggs is that it’s still soft and squishy.”…

Of the nests containing decoy eggs, a quarter were illegally harvested. Some of the eggs failed to connect to a GPS signal, while other eggs were spotted by poachers and tossed aside. Five of those poached eggs gave the team useful tracking data…This illegal trade network revealed that eggs are sold and consumed locally… The routes they discovered also suggest that most egg poachers in the area are individuals looking to make quick money, not an organized network.

Excerpt from Corryn Wetzel, 3-D Printed Sea Turtle Eggs Reveal Poaching Routes, SMITHSONIANMAG.COM, Oct. 7, 2020

Government Intervention is Great: What China is Learning from the United States

A study published by the China Aerospace Studies Institute in September 2020′China’s Space Narrative: Examining the Portrayal of the US-China Space Relationship in Chinese Sources‘ used publicly available Chinese language resources to draw insights on how the Chinese view the U.S.-China space relationship. According to the study:

“Chinese sources weave a space narrative that portrays China as a modernizing nation
committed to the peaceful uses of space and serving the broader interests of advancing humankind through international space cooperation, economic development, and scientific discovery. Chinese sources minimize the military role of China’s space program.

In contrast, the same sources portray the United States as the leading
space power bent on dominating space, restricting access to space, and limiting international space cooperation to countries with similar political systems and level of economic development.

The report concludes that the United States and China are in a long-term competition in space in which China is attempting to become a global power, in part, through the use of space. China’s primary motivation for developing space technologies is national security…China’s space program is one element of its efforts to transition the current U.S.-dominated international system to a multipolar world….

Many Chinese writings on commercial space analyze the experiences of U.S. companies, with a particular focus on SpaceX. Chinese space experts call SpaceX the “major representative company” for commercial space worldwide. A report from Hong Kong media claims that Chinese investors view SpaceX as the “benchmark company” for emerging commercial space companies in the mainland. Chinese authors also follow developments in other U.S. commercial space companies, such as Digital Globe
and Rocket Lab.

Chinese authors also pay attention to the ways in which the U.S. government uses various policies and incentives to create a favorable ecosystem for the growth of new commercial space companies. Chinese writings analyze ways in which NASA has supported private companies with funding, technology transfer, consulting, and infrastructure leasing. Although their specific recommendations vary, Chinese authors view strong government oversight and intervention as crucial toward the success of the domestic commercial space industry.”

Your Brain on Electro-Magnetic Fields

Current cockpits are flooded with radio frequency (RF) noise from on-board emissions, communication links, and navigation electronics, including strong electromagnetic (EM) fields from audio headsets and helmet tracking technologies. Pilots often report minor cognitive performance challenges during flight, and from 1993 to 2013, spatial disorientation in US Air Force pilots accounted for 72 Class A mishaps, 101 deaths, and 65 aircraft lost. It has been hypothesized that the cockpit RF and EM fields may influence cognitive performance including task saturation, misprioritization, complacency and Spatial Disorientation. However, EM fields and radio waves in cockpits are not currently monitored, little effort has been made to shield pilots from these fields, and the potential impacts of these fields on cognition have not been assessed.

Recent DARPA-funded research has demonstrated that human brains sense magnetic fields, like those used by animals for navigation, and that this process is “jammed” (i.e., disrupted) by radio waves (RF), impacting brainwaves and behavior. Furthermore, recent findings were the first to show that even weak RF fields and “earth strength” magnetic fields have measurable, reproducible effects on human brainwaves and unconscious behavior in a controlled environment. Current tactical audio headsets project magnetic fields up to 10 times earth strength, the effects of which can now be measured experimentally in a similar controlled environment.

[Phase II of the project will involve] developing next generation sensor suite capable of measuring the ambient EM/RF conditions in a military aircraft cockpit environment or a suitably similar analogue. This system must enable measurement of RF intensity vs frequency as well as RF absorption by various tissues in the human body and brain…The goal of Phase II experimentation will be to, not only identify any impacts of the cockpit EM/RF conditions that negatively impact pilot cognitive function or physiological sensor function, but also to develop and test various mitigation strategies to protect against these effects…


If this research and development effort reveals negative impacts of cockpit EM/RF environments on human cognitive function or physiological sensor performance, it is expected to generate interest from the commercial airline industry as well as other industries in which humans are exposed to similar EM/RF conditions

Excerpts from Impact Cockpit Electro-Magnetics on Aircrew Neurology (ICEMAN), DARPA, 2020
 
 
 
 
 
 
 
 
 

Beautiful Coal and Other Maladies

President Trump hasn’t been able to bring back “beautiful, clean coal” as he promised four years ago. As mines and power plants continue to close, the question many are asking in the diminishing American coal industry is—what now?

The use of coal to generate electricity in the U.S. is expected to fall more than a third during Mr. Trump’s first term, data from the U.S. Energy Information Administration show, as a glut of cheap natural gas unlocked due to fracking and increasingly competitive wind and solar sources gained market share. More than half of that drop happened before the new coronavirus outbreak. That compares with a decline of about 35% in coal consumed for power generation during Mr. Obama’s eight years in office.

In 2019, the U.S. consumed more renewable energy than coal for the first time since the 1880s, federal data show…“Coal isn’t coming back. You can’t legislate it,” said Karla Kimrey , previously a vice president at Wyoming-based coal producer Cloud Peak Energy Inc., which filed for bankruptcy protection last year. Domestic demand has continued to drop as utilities retire coal power plants and turn to cheap natural gas and renewables to make electricity, trends that have only accelerated as economies have slowed due to the pandemic. With less demand for power, many utilities have cut back on coal generation first, as it is generally more expensive

Meanwhile the rise of “ESG” or environmental, social and governance investing is constricting the industry’s ability to obtain capital, current and former executives say.  As major investors such as JPMorgan Chase & Co. and BlackRock Inc., the world’s largest asset manager, turn away from coal over concerns about climate change, coal companies are struggling to secure the insurance they need to operate. That hurts not only companies that mine the thermal coal used to generate electricity, but also those that mine metallurgical coal to make steel.

Excerpts from Rebecca Elliott and Jonathan Randles, Trump’s Promise to Revive Coal Thwarted by Falling Demand, Cheaper Alternatives, WSJ, Sept. 17, 2020

Addictive Ads and Digital Dignity

Social-media firms make almost all their money from advertising. This pushes them to collect as much user data as possible, the better to target ads. Critics call this “surveillance capitalism”. It also gives them every reason to make their services as addictive as possible, so users watch more ads…

The new owner could turn TikTok from a social-media service to a digital commonwealth, governed by a set of rules akin to a constitution with its own checks and balances. User councils (a legislature, if you will) could have a say in writing guidelines for content moderation. Management (the executive branch) would be obliged to follow due process. And people who felt their posts had been wrongfully taken down could appeal to an independent arbiter (the judiciary). Facebook has toyed with platform constitutionalism now has an “oversight board” to hear user appeals…

Why would any company limit itself this way? For one thing, it is what some firms say they want. Microsoft in particular claims to be a responsible tech giant. In January  2020 its chief executive, Satya Nadella, told fellow plutocrats in Davos about the need for “data dignity”—ie, granting users more control over their data and a bigger share of the value these data create…Governments increasingly concur. In its Digital Services Act, to be unveiled in 2020, the European Union is likely to demand transparency and due process from social-media platforms…In the United States, Andrew Yang, a former Democratic presidential candidate, has launched a campaign to get online firms to pay users a “digital dividend”. Getting ahead of such ideas makes more sense than re-engineering platforms later to comply.

Excerpt from: Reconstituted: Schumpeter, Economist, Sept 5, 2020

See also Utilities for Democracy: WHY AND HOW THE ALGORITHMIC
INFRASTRUCTURE OF FACEBOOK AND GOOGLE MUST BE REGULATED
(2020)

Living Insecticides: OX5034 Mosquito Obliterates Iteslf

A plan to release over 750 million genetically modified mosquitoes into the Florida Keys in 2021 and 2022 received final approval from local authorities, against the objection of many local residents and a coalition of environmental advocacy groups. The proposal had already won state and federal approval.

Approved by the Environment Protection Agency in May 2020, the pilot project is designed to test if a genetically modified mosquito is a viable alternative to spraying insecticides to control the Aedes aegypti. It’s a species of mosquito that carries several deadly diseases, such as Zika, dengue, chikungunya and yellow fever.  The mosquito, named OX5034, has been altered to produce female offspring that die in the larval stage, well before hatching and growing large enough to bite and spread disease. Only the female mosquito bites for blood, which she needs to mature her eggs. Males feed only on nectar, and are thus not a carrier for disease. The mosquito also won federal approval to be released into Harris County, Texas, beginning in 2021, according to Oxitec, the US-owned, British-based company that developed the genetically modified organism (GMO)…

In 2009 and 2010, local outbreaks of dengue feverleft the Florida Keys Mosquito Control District desperate for new options. Despite an avalanche of effort — from aerial, truck and backpack spraying to the use of mosquito-eating fish — local control efforts to contain the Aedes aegypti with larvicide and pesticide had been largely ineffective.
And costly, too. Even though Aedes aegypti is only 1% of its mosquito population, Florida Keys Mosquito Control typically budgets more than $1 million a year, a full tenth of its total funding, to fighting it…

The new male mosquito, OX5034, is programmed to kill only female mosquitoes, with males surviving for multiple generations and passing along the modified genes to subsequent male offspring….Environmental groups worry that the spread of the genetically modified male genes into the wild population could potentially harm threatened and endangered species of birds, insects and mammals that feed on the mosquitoes.


Excerpt from Sandee LaMotte, 750 million genetically engineered mosquitoes approved for release in Florida Keys, CNN, 

Under Zero Trust: the U.S. Chip Resurgence

The Defense Advanced Research Projects Agency launched its Electronic Resurgence Initiative (ERI)  to help reboot a domestic chip industry that has been moving steadily offshore for decades…. Program officials and chip industry executives foresee the emergence of a “5th generation of computing” based on current cloud infrastructure while combining AI, the Internet of Things (IoT) and 5G wireless networks to deliver big data.

“The U.S. microelectronics industry is at an inflection point,” Ellen Lord, undersecretary of defense for acquisition and sustainment, told the virtual ERI summit. After decades of offshoring of chip fabrication, packaging and testing capabilities, “How do we reverse this trend?”  The Defense Department is expanding its technology base efforts by implementing a “step-by-step process for reconstituting the microelectronics supply chain,” focusing on various segments of the semiconductor ecosystem, including memory devices, logic, ICs and advanced packaging along with testing and assembly.

“While DoD does not drive the electronics market,” constituting only about 1 percent of demand, “we can drive significant R&D,” ERI is advancing public-private partnerships that provide a framework for commercial innovation. The result would be “pathfinder projects” geared toward a renewal of U.S. chip manufacturing. As trade frictions with China grow, ERI is placing greater focus on ensuring the pedigree of U.S. electronics supply chain. “We need to find a path to domestic sources,” said Lord.

While nurturing government-industry partnerships as part of an emerging next-generation U.S. industrial policy, this year’s DARPA summit also emphasized chip standards and processes for securing fabs, foundry services, devices and foundational microelectronics. In that vein, U.S. officials stressed new chips metrics like “quantifiable assurance” to secure dual-use devices that could end up in weapons or an IoT device.

“Our interests to protect both the confidentiality and the integrity of our supply chain are aligned with commercial interests, and we will continue to work across government and industry to develop and implement our quantitative assurance strategy based on zero trust,” said Nicole Petta, principal director of DoD’s microelectronics office. The “zero trust” approach assumes no device is safe, and that all microelectronics components must be validated before deployment. The framework marks a philosophical departure from DoD’s “trusted foundry” approach instituted in the 1990s, largely because “perimeter defenses” failed to account for insider threats…

DARPA Chip Efforts Pivots to Securing US Supply Chain, https://www.hpcwire.com, Aug. 24, 2020

Buy Carbon Stored in Trees and Leave it There

For much of human history, the way to make money from a tree was to chop it down. Now, with companies rushing to offset their carbon emissions, there is value in leaving them standing. The good news for trees is that the going rate for intact forests has become competitive with what mills pay for logs in corners of Alaska and Appalachia, the Adirondacks and up toward Acadia. That is spurring landowners to make century-long conservation deals with fossil-fuel companies, which help the latter comply with regulatory demands to reduce their carbon emissions.

For now, California is the only U.S. state with a so-called cap-and-trade system that aims to reduce greenhouse gasses by making it more expensive over time for firms operating in the state to pollute. Preserving trees is rewarded with carbon-offset credits, a climate-change currency that companies can purchase and apply toward a tiny portion of their tab. But lately, big energy companies, betting that the idea will spread, are looking to preserve vast tracts of forest beyond what they need for California, as part of a burgeoning, speculative market in so-called voluntary offsets.

One of the most enthusiastic, BP PLC, has already bought more than 40 million California offset credits since 2016 at a cost of hundreds of millions of dollars. In 2019, the energy giant invested $5 million in Pennsylvania’s Finite Carbon, a pioneer in the business of helping landowners create and sell credits. The investment is aimed at helping Finite hire more foresters, begin using satellites to measure biomass and drum up more credits for use in the voluntary market.  BP has asked Finite to produce voluntary credits ASAP so they can be available for its own carbon ledger and to trade among other companies eager to improve their emissions math. As part of its shift into non-fossil-fuel markets, BP expects to trade offset credits the way it presently does oil and gas.“The investment is to grow a new market,” said Nacho Gimenez, a managing director at the oil company’s venture-capital arm. “BP wants to live in this space.”

Skeptics contend the practice does little to reduce greenhouse gases: that the trees are already sequestering carbon and shouldn’t be counted to let companies off the hook for emissions. They argue that a lot of forest protected by offsets wasn’t at high risk of being clear-cut, because doing so isn’t the usual business of its owners, like land trusts, or because the timber was remote or otherwise not particularly valuable.

If other governments join California and institute cap-and-trade markets, voluntary offsets could shoot up in value. It could be like holding hot tech shares ahead of an overbought IPO. Like unlisted stock, voluntary credits trade infrequently and in a wide price range, lately averaging about $6 a ton, Mr. Carney said. California credits changed hands at an average of $14.15 in 2019 and were up to $15 before the coronavirus lockdown drove them lower. They have lately traded for about $13.

These days, voluntary offsets are mostly good for meeting companies’ self-set carbon-reduction goals. BP is targeting carbon neutrality by 2050. Between operations and the burning of its oil-and-gas output by motorists and power plants, the British company says it is annually responsible for 415 million metric tons of carbon emissions.

Excerpts from Emissions Rules Turn Saving Trees into Big Business, WSJ, Aug. 24, 2020

The Green Climate Fund and COVID-19

 The Green Climate Fund has promised developing nations it will ramp up efforts to help them tackle climate challenges as they strive to recover from the coronavirus pandemic, approving $879 million in backing for 15 new projects around the world…The Green Climate Fund (GCF) was set up under U.N. climate talks in 2010 to help developing nations tackle global warming, and started allocating money in 2015….

Small island states have criticised the pace and size of GCF assistance…Fiji’s U.N. Ambassador Satyendra Prasad said COVID-19 risked worsening the already high debt burden of small island nations, as tourism dived…The GCF  approved in August 2020 three new projects for island nations, including strengthening buildings to withstand hurricanes in Antigua and Barbuda, and installing solar power systems on farmland on Fiji’s Ovalau island.

It also gave the green light to payments rewarding reductions in deforestation in Colombia and Indonesia between 2014 and 2016. But more than 80 green groups opposed such funding. They said deforestation had since spiked and countries should not be rewarded for “paper reductions” in carbon emissions calculated from favourable baselines…. [T]he fund should take a hard look at whether the forest emission reductions it is paying for would be permanent.  It should also ensure the funding protects and benefits forest communities and indigenous people…

Other new projects included one for zero-deforestation cocoa production in Ivory Coast, providing rural villages in Senegal and Afghanistan with solar mini-grids, and conserving biodiversity on Indian Ocean islands.  The fund said initiatives like these would create jobs and support a green recovery from the coronavirus crisis.

Excerpts from Climate fund for poor nations vows to drive green COVID recovery, Reuters, Aug. 22, 2020

New Loan Sharks? Microfinance

Bangladesh may be the homeland of microcredit, but no country is keener on it than Cambodia. According to its central bank, there were some 160,000 branches of microfinance institutions around the country in 2016—one for almost every square kilometre of Cambodian territory. Almost 2.2m of Cambodia’s 10m-odd adults have a microcredit loan outstanding, according to the Cambodian Microfinance Association (CMA), an industry group. The average debt is $3,320—roughly twice the country’s annual gdp per person. Credit is growing by 40% a year.

The microfinance boom has brought many benefits. An obvious one is a decline in the use of loan sharks….But the industry’s breakneck growth may not be sustainable. Household debt has swollen as the size of loans has ballooned. According to the World Bank, the average loan grew “more than tenfold” over the past five years. …“[Cambodia] probably should have had a crisis by now,” admits Daniel Rozas, an adviser to the cma, “but somehow it hasn’t.”

That may be in part thanks to the efforts of the National Bank of Cambodia, the central bank, to tame the industry…Some regulations, however, may be exacerbating the industry’s excesses. The central bank’s introduction of an interest-rate cap of 18% a year in 2017 seems to have backfired. Because of the cap, the CMA says, microfinance institutions can turn a profit only by lending more than $2,000. The number of loans of $500 or less declined by 48% after the rule’s introduction, the World Bank estimates. Some fees rose, too.

The CMA says defaults are minimal, with only 1% of loans in serious arrears at the beginning of the year. But there are hints that borrowers are getting into difficulty. The typical loan uses land as collateral... Lenders seldom take borrowers to court to repossess land; it is not worth the time and expense for a loan of just a few thousand dollars. But many conscientious borrowers appear to sell their land voluntarily to pay up. Government surveys show that the proportion of people who are landless rose from 32% in 2009 to 51% in 2016. Among the many reasons given for selling land, one of the most common was to repay debts. Given that the government does little to monitor the conduct of lenders, and many land sales are informal, it is hard to tell how voluntary such transactions really are.

Excerpts from Service Economy: Development in Cambodia, Economist, Aug. 15, 2020

Forest Infernos and Food Self-Sufficiency

The Mega-Rice Project (MRP) — the conversion of 10,000 square km of peat forest into rice paddies — that was adopted in Indonesia in 1997, was a mega-failure. It produced hardly any rice because the peaty soil lacks the requisite minerals. Instead of spurring farming, the draining of the waterlogged forest with a 6,000km network of canals fuelled fire…. It was the biggest environmental disaster in Indonesia’s history.  Burning peat in 1997 on Kalimantan and the nearby island of Sumatra generated the equivalent of 13-40% of the average annual global emissions from fossil fuels. The MRP was abandoned in 1999 but its legacy endures in the infernos that have ravaged Kalimantan almost every year since.

As work begins in 2020 on the new plantation, is history poised to repeat itself? The government says it has learned from the past. Nazir Foead of the Peatland Restoration Agency says that tractors will steer clear of what remains of Central Kalimantan’s pristine peatlands…but the rest is covered in “shallow peat”, no more than 50cm deep, and so can be cultivated without cataclysm, he says.  Environmentalists are not convinced… Smouldering swamps belch vast amounts of carbon. In 2019, the fires that swept Indonesia emitted 22% more carbon than the conflagration in the Amazon rainforest did. 

But the government argues it must go ahead with the plantation, and quickly, in case covid-19 brings about food shortages… For decades the political elites “have been chasing this ideal of food self-sufficiency”, says Jenny Goldstein of Cornell University. Prabowo Subianto, the defence minister, is one of its greatest champions.

Excerpts from For Peat’s Sake: Indonesia’s Environment, Economist, Aug. 15, 2020

Trade in Human and Animal Hair in the 21st Century

“My outfit for the day determines what hair I will be wearing,” says Olayinka Titilope, a Nigerian wigmaker. She has a different peruke for each day of the month…She sells wigs for between $60 and $800. Those at the top end are made of human hair from Cambodia, she says.  Some African feminists argue that to wear a long, straight-haired wig or hair extension is to grovel to Western ideals of beauty. Yet wig-buyers in Nigeria seem to enjoy variety. Sellers advertise hair from everywhere. Brazilian is praised for its sheen and durability; Vietnamese, for its bounce; Mongolian, because it is easy to curl. One seller in Lagos offers “Italian posh hair” which is supposedly odour-free. Whatever the label says, much of the hair really comes from elsewhere, often China, a source some buyers deem downmarket.

It is hard even for the most conscientious hair-traders to trace where their wares came from. Most of the hair that reaches Africa travels via factories in China, where it is sorted and often treated, dyed or curled. Bundles of human hair may be bulked up with horse mane or goat thatch….“The demand for hair generally exceeds supply, fuelling an almost constant sense of scarcity,”…

In the past decade Myanmar has quadrupled the volume of hair it ships out and is now the world’s fourth-largest exporter. Nay Lin, a hair-trader in the former capital, Yangon, says he knows when the economy is bad because more women turn up at his shop to sell their tresses. …Some 500km north of Yangon, in the town of Pyawbwe, farmers who once harvested onions and chillies now spend their days unpicking hairballs. These are often gathered by door-to-door collectors, who buy hair from people’s combs and bathroom plugs. Some hairballs arrive in sacks from India and Bangladesh. Workers in Pyawbwe (which has earned the nickname “Hair City”) make about $1.20 a day untangling them and removing lice or white strands. This hair is so common in Chinese factories that it is referred to as “standard hair”. It costs more than the fake stuff, but less than locks cut straight from a head. “We call that stuff factory trash,” scoffs Ms Titilope, who insists that none of it goes into her products…

Excerpts from Nigeria’s demand for fancy wigs fuels a global trade, Economist, Aug. 15, 2020

The End of the Mindless Self-Indulgence: the Gulf States

Algeria needs the price of Brent crude, an international benchmark for oil, to rise to $157 dollars a barrel. Oman needs it to hit $87. No Arab oil producer, save tiny Qatar, can balance its books at the current price, around $40 (summer 2020)….The world’s economies are moving away from fossil fuels. Oversupply and the increasing competitiveness of cleaner energy sources mean that oil may stay cheap for the foreseeable future. 

Arab leaders knew that sky-high oil prices would not last for ever. Four years ago Muhammad bin Salman, the de facto ruler of Saudi Arabia, produced a plan called “Vision 2030” that aimed to wean his economy off oil. Many of his neighbours have their own versions. But “2030 has become 2020…” 

Still, some see an upside to the upheaval in oil-producing states. The countries of the Gulf produce the world’s cheapest oil, so they stand to gain market share if prices remain low. As expats flee, locals could take their jobs…

Remittances from energy-rich states are a lifeline for the entire region. More than 2.5m Egyptians, equal to almost 3% of that country’s population, work in Arab countries that export a lot of oil. Numbers are larger still for other countries: 5% from Lebanon and Jordan, 9% from the Palestinian territories. The money they send back makes up a sizeable chunk of the economies of their homelands. As oil revenue falls, so too will remittances. There will be fewer jobs for foreigners and smaller pay packets for those who do find work. This will upend the social contract in states that have relied on emigration to soak up jobless citizens….With fewer opportunities in the oil-producing states, many graduates may no longer emigrate. But their home countries cannot provide a good life. Doctors in Egypt earn as little as 3,000 pounds ($185) a month, a fraction of what they make in Saudi Arabia or Kuwait. A glut of unemployed graduates is a recipe for social unrest…

For four decades America has followed the “Carter Doctrine”, which held that it would use military force to maintain the free flow of oil through the Persian Gulf. Under President Donald Trump, though, the doctrine has started to fray. When Iranian-made cruise missiles and drones slammed into Saudi oil facilities in September 2019, America barely blinked. The Patriot missile-defence batteries it deployed to the kingdom weeks later have already been withdrawn. Outside the Gulf Mr Trump has been even less engaged, all but ignoring the chaos in Libya, where Russia, Turkey and the UAE (to name but a few) are vying for control.

A Middle East less central to the world’s energy supplies will be a Middle East less important to America. ..As Arab states become poorer, the nature of their relationship with China may change. This is already happening in Iran, where American sanctions have choked off oil revenue. Officials are discussing a long-term investment deal that could see Chinese firms develop everything from ports to telecoms… Falling oil revenue could force this model on Arab states—and perhaps complicate what remains of their relations with America.

Excerpts from The Arab World: Twilight of the Petrostates, Economist, July  18, 2020

A Dream Come True? the Saudi Nuclear Program

Saudi Arabia has constructed with Chinese help a facility for extracting uranium yellowcake from uranium ore, an advance in the oil-rich kingdom’s drive to master nuclear technology…Even though Riyadh is still far from that point, the facility’s exposure appears certain to draw concern in the U.S. Congress, where a bipartisan group of lawmakers has expressed alarm aboutabout Saudi Crown Prince Mohammed bin Salman’s 2018 vow that “if Iran developed a nuclear bomb, we will follow suit as soon as possible.” ….Saudi Arabia has no known nuclear-weapons program, operating nuclear reactors or capacity to enrich uranium. But it says it wants to acquire nuclear plants that Saudi authorities say will generate power and reduce its reliance on oil, its principal export…

“Yellowcake” is a milled form of uranium ore which occurs naturally in Saudi Arabia and neighboring countries such as Jordan. It is produced by chemically processing uranium ore into a fine powder. It takes multiple additional steps and technology to process and enrich uranium sufficiently for it to power a civil nuclear energy plant. At very high enrichment levels, uranium can fuel a nuclear weapon…Olli Heinonen said that…yellowcake facility alone wouldn’t mark a significant advance unless the yellowcake is converted into a compound known as uranium hexafluoride and then enriched. But Mr. Heinonen said of the Saudis, “Where is the transparency? If you claim your program is peaceful, why not show what you have?”

One Western official said the facility is located in a remote desert location in the general vicinity of al Ula, a small city in northwest Saudi Arabia. Two officials said it was constructed with the help of two Chinese entities. While the identities of these entities couldn’t be learned, the China National Nuclear Corp. signed a memorandum of understanding with Saudi Arabia in 2017 to help explore its uranium deposits. A second agreement was signed with China Nuclear Engineering Group Corp. That followed a 2012 pact announced between Riyadh and Beijing to cooperate on peaceful uses of nuclear energy.

Riyadh has expressed a desire to master all aspects of the nuclear fuel cycle. It is constructing with Argentina’s state-owned nuclear technology company a small research reactor outside of Riyadh. In recent years, the Saudis have significantly expanded their nuclear workforce, experts say, through academic nuclear engineering programs and growing research centers. In addition to its agreement with Argentina, the Saudis are collaborating with South Korea in refining the design of a small commercial reactor to be built in Saudi Arabia, and that could also be marketed to other nations in the Middle East and Southeast Asia. It also has public cooperation agreements with Jordan on uranium mining and production.

Excerpts from  Warren P. Strobel et al., Saudi Arabia, With China’s Help, Expands Its Nuclear Program, WSJ, Aug. 4, 2020

How to Poison a Population: War and Persistent Oil Pollution

Oil pollution in Syria has been a growing concern since the 2011 onset of a civil war that has taken a toll on oil infrastructure and seen rival powers compete over control of key hydrocarbon fields. In the Kurdish-held northeast, a large storage facility in the Rmeilan oil field in Hasakeh province is of particular concern, according to the Dutch peace organisation PAX. [A River of Death, pdf] Oil leaks from the Gir Zero storage facility have been suspected since at least 2014, the latest in March 2020, it said in a June report. Thousands of barrels have leaked out into creeks in the area over the past five years, threatening the health and livelihoods of people in dozens of villages….

The major Rmeilan field controlled by the Kurdish administration, located near a US airbase, has been among the Syrian Kurds’ most prized assets since regime forces withdrew early on in the war. But oil wealth comes at a heavy cost for livestock farmers
whose sheep and cows have died because they drank oil contaminated water.

Residents too suffer heavily from the pollution because  of the foul odour of gas and crude oil wafting over the area… Compounding the situation, makeshift oil refineries have cropped up across the northeast in recent years, dumping oil waste in the waterways…These informal refineries receive oil from nearby fields and process it to provide benzine, gasoline and diesel to locals.

Excerpts from Delil SouleimanBlack waters: Oil spills pollute northeast Syria creeks
by Delil Souleiman, AFP, July 23, 2020

Global Nuclear Waste Movements: from Estonia to Utah

Regulators are weighing whether a local uranium company can import the material for processing at a mill near the border of a Native American reservation. For Energy Fuels Inc , the shipment represents an economic lifeline, after the company posted an operating loss of $7.8 million for the first quarter of 2020. Its president in March 2020 described the U.S. uranium industry as being “on the cusp of complete collapse.”
But for the Ute Mountain Ute Tribe living near the facility – the only operational uranium mill in the United States – the proposal has stoked fears that tribal land will become a dumping ground for global radioactive waste. Both the White Mesa mill and the tribal reservation are in San Juan County, Utah’s poorest.

The mill, built in 1979, was only meant to process conventional uranium ores from the Colorado Plateau for up to 20 years, the tribe says. The Navajo Utah Commission and Navajo Nation have also that the company’s application be rejected. “The state of Utah must recognize and acknowledge the reality that the mill is far past its design life and no longer a conventional uranium mill, but, instead, a radioactive waste dump seeking to operate for decades, if not a millennium,” the Ute Mountain Ute Tribe said in a document submitted to the state….

The 660 tons of powdered material in question, now sitting in 2,000 drums at a plant on the Estonian coast near the Russian border, would be Energy Fuels’ first-ever radioactive import from outside North America. The powder is a byproduct from tantalum and niobium mining by Estonian company Silmet, which contains uranium. But it cannot stay within Estonia, where there is no licensed facility for reprocessing radioactive material. Energy Fuels says there is enough uranium in that byproduct that it is worth processing. Opponents say Energy Fuels is simply taking in waste, which would be stored on site. According to Energy Fuels business from the shipment would help the company keep its 70 workers employed.

Energy Fuels anticipates demand for domestic uranium could rise, after the Trump administration in April 2020 proposed a $1.5 billion federal uranium reserve that would purchase uranium from domestic producers. Such a reserve, however, would need Congressional approval – a major hurdle. The reserve was one of the main proposals to come from a federal Nuclear Fuel Working Group aimed at reviving the U.S. uranium and nuclear industry. The United States currently imports over 90% of its uranium from abroad for its reactors.

Excerpts from Valerie Volcovicin Utah, a Debate Stirs Over Estonian Radioactive Waste, Reuters, July 16, 2020

Fatalism about Plastics: Intractable Plastics Pollution

The annual inflow of plastic could nearly triple from 2016 to 2040, the study found, and even if companies and governments meet all their commitments to tackle plastic waste, it would reduce the projection for 2040 by only 7%, still a more-than twofold increase in volume.  The study’s authors, the nonprofit Pew Charitable Trust and sustainability consulting firm Systemiq Ltd., set out a range of measures to stem the flow and called on businesses and governments to do more to reduce the use of plastic. 

The study attributes the surge to a growing global population using more plastic per person. Other factors include greater use of nonrecyclable plastics and an increasing share of consumption occurring in countries with poor waste management. China and Indonesia are likely the top sources of plastic reaching the oceans, accounting for more than a third of the plastic bottles, bags and other detritus washed out to sea, according to a study published in 2015 by Jenna Jambeck, an environmental engineer at the University of Georgia.

Over the past two years China has been making strides to improve waste management, including banning the import of plastic and other waste from developed countries like the U.S., which for decades have shipped much of their trash overseas. Indonesia has implemented its own restrictions on trash coming in from overseas, while lawmakers in the U.S. are increasingly trying to find ways to improve the country’s domestic recycling rates as export markets vanish.

They found that flexible plastic packaging—particularly items like potato-chip bags and food pouches, which are made of several materials and typically aren’t recycled—accounts for a disproportionate amount of ocean plastic. The As You Sow report said companies should stop selling products in flexible plastic until it is recycled or composted in significant amounts. Companies, in response, have been redesigning flexible packaging to promote recycling. For example, Nestle recently began selling a line of Gerber baby-food pouches made from a single material. But hurdles remain, particularly around collection and sorting of the packaging…

The amount of plastic flowing into the oceans could be reduced by as much as 80% over the next 20 years through a combination of reduced plastic use, increased recycling, alternatives to problematic packaging like plastic pouches and better waste management, the Pew-Systemiq study said…

Excerpts from Saabira Chaudhuri, Ocean Plastic Is Getting Worse and Efforts to Stem the Tide Fall Short, Study Finds, WSJ, July 23, 2020

Water Conflicts: Who Owns the Nile River

The Grand Ethiopian Renaissance Dam is a giant edifice that would span the Blue Nile, the main tributary of the Nile river.  Half a century in the making, the hydro-electric dam is Africa’s largest, with a reservoir able to hold 74bn cubic metres of water, more than the volume of the entire Blue Nile. Once filled it should produce 6,000 megawatts of electricity, double Ethiopia’s current power supply. Millions of people could be connected to the grid for the first time. More than an engineering project, it is a source of national pride.

For Egypt, however, it seems a source of national danger. Over 90% of the country’s 100m people live along the Nile or in its vast delta. The river, long seen as an Egyptian birthright, supplies most of their water. They fear the dam will choke it off. Pro-regime pundits, not known for their subtlety, have urged the army to blow it up….Ethiopia wants to start filling the reservoir during this summer’s rainy season. On June 26th, 2020 after another round of talks, Egypt, Ethiopia and Sudan pledged to reach a deal within two weeks. Ethiopia agreed not to start filling the dam during that period.

Diplomats say most of the issues are resolved. But the outstanding one is big: how to handle a drought. Egypt wants Ethiopia to promise to release certain amounts of water to top up the Nile. But Ethiopia is loth to “owe” water to downstream countries or to drain the reservoir so much that electric output suffers. It wants a broader deal between all riparian states, including those on the White Nile, which flows out of Lake Victoria down through Uganda and Sudan.

Even if talks fail and Ethiopia starts filling without a deal, Egyptians will not find their taps dry. There is enough water in the reservoir behind Egypt’s Aswan High Dam to make up for any shortfall this year. But the mood in both countries is toxic. Egyptians have cast Ethiopia as a thief bent on drying up their country. In Ethiopia, meanwhile, Egypt is portrayed as a neocolonial power trampling on national sovereignty. The outcome of the talks will have political consequences in both countries, and perhaps push them to the brink of conflict—at a time when Egypt is already contemplating involvement in a war in Libya.

Ethiopia’s grand dam became a reality and a national obsession under Meles Zenawi, the longtime prime minister who ruled until 2012. His political masterstroke was asking Ethiopians to finance it through donations and the purchase of low-denomination bonds…. Most contributed voluntarily, but there was always an element of coercion. Civil servants had to donate a month’s salary at the start. Local banks and other businesses were expected to buy bonds worth millions of birr. ….

Excerpts from The Grand Ethiopian Renaissance Dam: Showdown on the Nile, Economist, July 4, 2020

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Air Pollution: the Microplastics We Breath

 Scientists measured microplastics — tiny particles and fibers of plastic that can float in the air like dust — and found that over 1,000 tons a year are falling into wilderness areas and national parks in the western U.S.  Janice Brahney of Utah State University and her team identified samples of microplastics and other particulates collected over 14 months in 11 national parks and wilderness areas to create the study published in the journal Science, on June 12, 2020.  Pieces of plastic less than 5 mm in length, or microplastics, occur in the environment as a consequence of plastic pollution…

The presence of microplastics in oceans and water supplies has been a matter of concern for some time, but the impact of airborne microplastics is a relatively new area of study. Though microplastics are found nearly everywhere on Earth, the sources and processes behind their ubiquitous distribution, or the “global plastic cycle,” remain vaguely understood.  Initially overlooked, recent studies have suggested that long-range atmospheric transport plays an important role in carrying microplastic pollution vast distances and to remote locations

Examination of weekly wet and monthly dry samples from 11 sites allowed the authors to estimate that more than 1,000 tons of microplastics are deposited onto protected lands in the western U.S. each year, equivalent to more than 123 million plastic water bottles.

The ubiquity of microplastics in the atmosphere has unknown consequences for humans and animals, but the research team observed sizes of particles that were within the ranges that accumulate in lung tissue. Moreover, the accumulation of plastic in the wilderness areas and national parks could well influence the ecosystems in complicated ways.

Excerpts, VICTORIA PRIESKOP, Scientists Find Tons of Microplastics Polluting National Parks, Courthouse News Service, June 11, 2020

An Impossible Made Possible: the Green Energy Revolution

Since the cost of renewable energy can now be competitive with fossil fuels. Government, corporate and consumer interests finally seem to be aligning.  The stock market has noticed. After years of underperformance, indexes that track clean-energy stocks bottomed out in late 2018. The S&P Global Clean Energy index, which covers 30 big utilities and green-technology stocks, is now up 37% over two years, including dividends, compared with 18% for the S&P 500.

This year’s Covid crisis will delay some renewable projects, but could speed up the energy transition in other ways. Alternative-energy spending has held up much better than spending on oil and gas. Globally, clean-energy investment is now expected to account for half of total investment in the entire energy sector this year, according to UBS.  Moreover, the crisis has pushed governments to spend money, including on renewable technologies. The massive stimulus plan announced by the European Union last month is decidedly green. The German government increased electric-car subsidies as part of its pandemic-related stimulus package rather than rolling out a 2009-style “cash-for-clunkers” program. China’s plans include clean-energy incentives, too.

Solar and wind are now mature technologies that provide predictable long-term returns. Big lithium-ion batteries, such as those that power Teslas, are industrializing rapidly. More speculatively, hydrogen is a promising green fuel for hard-to-decarbonize sectors such as long-haul transport, aviation, steel and cement.  Many big companies—the likes of Royal Dutch Shell, Air Liquide and Toyota —have green initiatives worth many hundreds of millions of dollars. They are, however, a relatively small part of these large businesses, some of whose other assets may be rendered obsolete by the energy transition… Early-stage electric-truck maker Nikola jumped on its market debut this month to a valuation at one point exceeding that of Ford.

Investors might be better off looking at the established specialists in between. Vestas is the world’s leading manufacturer of wind turbines. Orsted, another Danish company, has made the transition from oil-and-gas producer to wind-energy supplier and aspires to be the first green-energy supermajor. More speculatively, Canadian company Ballard has three decades of experience making hydrogen fuel cells.

Rochelle Toplensky, Green Energy Is Finally Going Mainstream, WSJ, June 24, 2020

Everyone for Themselves: COVID-19 Drug Reserved for U.S.

On June 29, 2020 the US Department of Health and Human Services (HHS) announced an agreement to secure large supplies of the drug remdesivir for the United States from Gilead Sciences through September, allowing American hospitals to purchase the drug in amounts allocated by HHS and state health departments….HHS has secured more than 500,000 treatment courses of the drug for American hospitals through September. This represents 100% of Gilead’s projected production for July (94,200 treatment courses), 90% of production in August (174,900 treatment courses), and 90% of production in September (232,800 treatment courses), in addition to an allocation for clinical trials. A treatment course of remdesivir is, on average, 6.25 vials.

Hospitals will receive the product shipped by AmerisourceBergen and will pay no more than Gilead’s Wholesale Acquisition Price (WAC), which amounts to approximately $3,200 per treatment course.

Excerpts from Trump Administration Secures New Supplies of Remdesivir for the United States, June 29, 2020

No Clean-Up, No Justice: Ogoniland, Nigeria

The UN Environment Programme in 2011 proposed the creation of a $1 billion fund to repair the damage done by decades of crude spills in the Ogoniland area in southeastern Nigeria. However, progress has been poor and the little work that has been done is sub-standard, advocacy groups including Amnesty International reported in June 2020.  “Research reveals that there is still no clean-up, no fulfillment of ‘emergency’ measures, no transparency and no accountability for the failed efforts, neither by the oil companies nor by the Nigerian government,” the groups said.

Shell’s Nigerian unit pumped oil in Ogoniland until 1993, when the company withdrew amid increasing protests against its presence. Even though the Hague-based company no longer produces crude in the area, a joint venture operated by Shell Petroleum Development Company, or SPDC, still owns pipelines that crisscross the region.

A government agency responsible for overseeing the clean-up, the Hydrocarbon Pollution Remediation Project, known as Hyprep, was finally set up in 2017 after several false starts, but it’s failing to deliver. …“Hyprep is not designed, nor structured, to implement a project as complex and sizable as the Ogoniland clean-up,” the report cites UNEP as saying in 2019

Excerpt from Clean Up Oil in Nigerial Lacks Progress, Bloomberg, June 18,, 2020

The $4 Trillion Blackmail: The Amazon is Ours not Brazil’s

More than two dozen financial institutions around the world are demanding the Brazilian government rein in surging deforestation, which they said has created “widespread uncertainty about the conditions for investing in or providing financial services to Brazil”. The call for action, delivered in a letter to the Brazilian government on June 23, 2020, comes as concerns grow that investors may begin to divest from Latin America’s largest economy if Jair Bolsonaro’s administration fails to curb environmental destruction. “As financial institutions, who have a fiduciary duty to act in the best long-term interests of our beneficiaries, we recognise the crucial role that tropical forests play in tackling climate change, protecting biodiversity and ensuring ecosystem services,” said the letter, signed by 29 financial institutions managing more than $3.7tn in total assets.

“Considering increasing deforestation rates in Brazil, we are concerned that companies exposed to potential deforestation in their Brazilian operations and supply chains will face increasing difficulty accessing international markets. Brazilian sovereign bonds are also likely to be deemed high risk if deforestation continues.” Deforestation in the Amazon rainforest has surged in Brazil since the election of Mr Bolsonaro, a rightwing former army captain, who supports opening the protected lands to commercial activity. In the first four months of 2020, an area twice the size of New York City was razed as illegal loggers and wildcat gold miners

Investors said they are particularly concerned about Brazil’s meatpacking industry, which risks being shut out of international markets over its alleged role in deforestation. Brazil’s JBS has been repeatedly accused by environmentalists of buying cows from deforested lands in the Amazon. In May 2020 more than 40 European companies, including Tesco and Marks and Spencer, warned they would boycott Brazilian products if the government did not act on deforestation. 

Excerpts from Investors warn Brazil to stop Amazon destruction, FT, June 23, 2020

Oil Spills of Sudan, Humanity for Africa, and East African Court of Justice

The East African Court of Justice delivered in June 2020 a temporary injunction order to the country’s Minister for Justice, the Greater Pioneer Operating Company (GPOC), and the Dar Petroleum Operating Company. The Court approved the application by Hope for Humanity Africa (H4HA), a non-governmental organization (NGO), which sought to highlight the environmental damage caused by oil spills… The NGO contends that: “Over 47,249 of the local population in Upper Nile State and 60,000 in Unity State are at risk of being exposed to the oil pollution this is because the local population depends on the wild foods for survival, the contaminated swamps, streams and rivers waters for cooking, drinking, washing, bathing and fishing.”…

The H4HA is looking for an injunction to stop multiple companies from exporting oil from the region, including CNPC of China, Petronas of Malaysia, and Oil & Natural Gas Corp. of India (ONGC) 

Excerpts South Sudan Suspended by African Union, Barred From Exporting Oil by East African Court, https://www.youngbhartiya.com, June 24, 2020

Leave No Oil Under-Ground: OPEC against US Frackers

In 2014-16, the OPEC waged a failed price war to wipe out American frackers. Since then the cartel and its partners, led by Russia, have propped up oil prices enough to sustain shale, but not enough to support many members’ domestic budgets. In March 2020 Saudi Arabia urged Russia to slash output; Russia refused, loth to let Americans free-ride on OPEC-supported prices. The ensuing price war was spectacularly ill-timed, as it coincided with the biggest drop in oil demand on record.  The desire to chasten American frackers remains, though. OPEC controls about 70% of the world’s oil reserves, more than its 40% market share would suggest… If the world’s appetite for oil shrinks due to changing habits, cleaner technology or greener regulations, countries with vast reserves risk having to leave oil below ground. 

Excerpts from Crude Oil: After the Fall, Economist, June, 13, 2020

Praying for Renewable Energy

In the wake of the Fukushima nuclear disaster in 2011, Fukushima prefecture itself pledged to get all its power from renewable sources by 2040.  The hoped-for transformation, however, has been “slow and almost invisible.”…Renewable generation has grown from 10% of the power supply in 2010 to 17% in 2018, almost half of which comes from old hydropower schemes. Most nuclear plants, which provided more than a quarter of the country’s power before the 2011 disaster, have been shut down… But for the most part they have been replaced not by wind turbines and solar panels but by power stations that burn coal and natural gas. The current government wants nuclear plants to provide at least 20% of electricity by 2030. It also wants coal’s share of generation to grow, and has approved plans to build 22 new coal-fired plants over the next five years. The target for renewables, by contrast, is 22-24%, below the current global average, and far lower than in many European countries.

Geography and geology provide part of the answer. Japan is densely populated and mountainous. That makes solar and onshore wind farms costlier to build than in places with lots of flat, empty land. The sea floor drops away more steeply off Japan’s coasts than it does in places where offshore wind has boomed, such as the North Sea. And although geothermal power holds promise, the most suitable sites tend to be in national parks or near privately owned hot springs.

Government policies also help stifle the growth of renewable energy. Since the end of the second world war, privately owned, vertically integrated regional utilities have dominated the electricity market. These ten behemoths provide stable power within their regions, but do little to co-ordinate supply and demand across their borders…The limited transmission between regions makes it even harder than usual to cope with intermittent generation from wind turbines and solar panels. It also reduces competition, which suits the incumbent utilities just fine…Recent reforms have attempted to promote renewables both directly and indirectly…The “feed-in tariff”, obliging utilities to pay a generous fixed price for certain forms of renewable energy—a policy that has prompted investors to pile into solar and wind in other countries. In 2016, the government fully liberalised the retail electricity market. It has also set up new regulatory bodies to promote transmission between regions and to police energy markets. In April 2020 a law came into force that requires utilities to run their generation, transmission and distribution units as separate businesses. These reforms constitute a policy of “radical incrementalism”.

Critics say the steps have been too incremental and not radical enough. Utilities continue to make it time-consuming and costly for new entrants to get access to the grid, imposing rules that are “not fair for newcomers”, according to Takahashi Hiroshi of Tsuru University. Existing power plants are favoured over new facilities, and the share of renewables is limited, on the ground that their intermittency threatens the grid’s stability.

But even if the government is timid, investors can still make a difference…. Several of Japan’s big multinationals have pledged to switch to clean power on a scale and schedule that put the government’s targets to shame. Environmental activism has made banks and businesses wary of investments in coal. Even big utilities have come to see business opportunities in renewables, especially in the government’s imminent auction of sites for offshore wind plants. Two of them, Tohoku Electric Power and Tokyo Electric Power (TEPCO), have announced plans this year to issue “green bonds” to finance renewables projects. In March 2020, TEPCO established a joint venture with Orsted, a Danish oil firm that has become a pioneer in offshore wind. 

Exceprts from Renewable Energy in Japan: No Mill Will, Economist, June 13, 2020

Amazon Rainforest: Source of Food for Vegans, Meat-Lovers

In the first four months of 2020 an estimated 1,202 square km (464 square miles) were cleared in the Brazilian Amazon, 55% more than during the same period in 2019, which was the worst year in a decade…Less attention has been paid to the role of big firms like JBS and Cargill, global intermediaries for beef and soya, the commodities that drive deforestation.  The companies do not chop down trees themselves. Rather, they are middlemen in complex supply chains that deal in soya and beef produced on deforested land. The process begins when speculators, who tend to operate outside the law, buy or seize land, sell the timber, graze cattle on it for several years and then sell it to a soya farmer. Land in the Amazon is five to ten times more valuable once it is deforested, says Daniel Nepstad, an ecologist. Not chopping down trees would have a large opportunity cost. In 2009 Mr Nepstad estimated that cost (in terms of forgone beef and soy output) would be $275bn over 30 years, about 16% of that year’s GDP.

Under pressure from public opinion, the big firms have made attempts to control the problem. In 2009, a damning report from Greenpeace led JBS, Marfrig and Minerva, meat giants which together handle two-thirds of Brazil’s exports, to pledge to stop buying from suppliers that deforest illegally. (The forest code allows owners to clear 20% of their land.) JBS, which sources from an area in the Amazon larger than Germany, says it has blocked 9,000 suppliers, using satellites to detect clearing.

The problem is especially acute in ranching, which accounts for roughly 80% of deforestation in the Amazon, nearly all of it illegal. “Cows move around,” explains Paulo Pianez of Marfrig. Every fattening farm the big meatpackers buy from has, on average, 23 of its own suppliers. Current monitoring doesn’t cover ranchers who breed and graze cattle, so it misses 85-90% of deforestation. Rogue fattening farms can also “launder” cattle by moving them to lawful farms—perhaps their own—right before selling them. A new Greenpeace report alleges that through this mechanism JBS, Marfrig and Minerva ended up selling beef from farms that deforested a protected Amazon reserve on the border between Brazil and Bolivia. They said they had not known about any illegality.

One reason that soya giants seem more serious than meat producers about reducing deforestation a network of investors concerned about sustainability, is that most soya is exported. The EU is the second-top destination after China. But companies struggle to get people to pay more for a “hidden commodity”… But few people will pay extra for chicken made with sustainable soya, which explains why just 2-3% is certified deforestation-free. ….Four-fifths of Brazilian beef, by contrast, is eaten in Brazil. Exports go mostly to China, Russia and the Middle East, where feeding people is a higher priority than saving trees. Investors, for their part, see beef firms as unsexy businesses with thin margins

According to soya growers, multinational firms failed to raise $250m to launch a fund for compensating farmers who retain woodland. “They demand, demand, demand, but don’t offer anything in return,” complains Ricardo Arioli….

Reducing deforestation will require consensus on tricky issues like the fate of tens of thousands of poor settlers on public lands in the Amazon, where half of deforestation takes place….

Excerpts from The AmazonL Of Chainshaws and Supply Chains, Economist, JUne 13, 2020

The Big Trash Burners: Does it Make Sense to Incinerate Waste?

Global waste is expected to hit 3.4 billion tons by 2050 from 2.01 billion tons in 2016, according to the World Bank. As recycling programs encounter challenges and landfills in the U.S. and Europe reach capacity or face regulations making them more expensive, incinerators are becoming the most viable option for many municipalities to deal with much of their garbage. England now burns more municipal waste than it recycles or landfills. China—already the world’s biggest trash burner—is building more incinerators. And incineration companies say, for the first time in years, expansion projects are on the table in the U.S., although the industry faces significant legal and community challenges. Overall, incinerator-plant capacity is forecast to rise 43% globally between 2018 and 2028, according to Ecoprog, a consulting firm…..

Another growth driver is a European Union target for member states to cap the amount of municipal trash they send to landfill at 10% by 2030. Local communities and environmental groups have launched strong opposition to expansion of incineration plans, citing environmental and public-health concerns. Incinerator plants are also called waste-to-energy plants since the heat from burning trash is used to generate electricity, and many governments classify that electricity as renewable energy, a characterization opponents dispute…..But advocates for clean energy…say that while some energy is recovered by burning, recycling or composting garbage would save far greater amounts of energy.

Critics also say cities that own their incinerator plants have little incentive to pursue waste-reduction efforts because the plants are designed to run at full capacity. “Many countries are over-investing in incineration to cut down on landfilling, which will eventually lock them into burning,” said Janek Vähk, development and policy coordinator for Zero Waste Europe.

Excerpts from Saabira Chaudhuri, Trash Burning Ignites as World’s Waste Swells, WSJ, June 10, 2020

The Nuclear Option: Chopping off Hong Kong from the Dollar System

China and America have begun the fraught business of disentangling their financial systems. Chinese firms with shares listed in New York have rushed to float in Hong Kong, too, after the White House signalled they are not welcome on Wall Street….But now Hong Kong itself, the world’s third-biggest international financial centre, has become a geopolitical flashpoint. Its unique role as the conduit between global capital markets and China’s inward-looking financial system means that both sides must tread carefully.

On May 28, 2020 China said it would enact a new national-security law for Hong Kong, undermining the formulation of “one country, two systems” in place since 1997, under which the territory is supposed to be governed until 2047. In response, America has said it may downgrade the legal privileges it grants Hong Kong, which treat it as autonomous from China

Hong Kong’s place in the world depends on having the rule of law, a trusted reputation and seamless access to Western financial markets. Other Chinese cities have big stock exchanges: shares listed in Shanghai and Shenzhen are together worth a lot more than those in Hong Kong. But neither has fair courts, an independent central bank, free movement of capital or a mix of Western and Chinese firms. These foundations are the basis for $9.7trn of cross-border financial claims, such as loans, that are booked in the territory. Hong Kong is also where mainland Chinese firms and banks go to deal in the dollar, the world’s dominant currency. Some $10trn of dollar transactions flowed through Hong Kong’s bank-to-bank payments system last year.

Until recently, conventional wisdom held that Hong Kong’s position would be assured for 20-30 years, because it would take that long for China either to upgrade its markets to Western standards or to become so powerful that it could impose mainland practices, and the yuan, on the rest of the world. But the trade war, a year of street protests and China’s iron-fisted response to them raise new questions about Hong Kong’s durability. Bullying from Beijing erodes the sense that it is autonomous. And there is an outside chance that America could impose sanctions or other restrictions that would stop some Hong Kong officials, firms or banks from using dollars….. America’s might bring into question whether money parked in Hong Kong is still fully fungible with money in the global financial system. If these worries spread, they could destabilise Hong Kong and cause a financial shock in China and well beyond it.

The good news is that so far there is no sign of capital flight. Hong Kong’s vast deposit base has been stable in recent weeks, say its bankers. Investors are reassured by its $440bn or so mountain of foreign reserves and a long record of capable financial management. The rush of Chinese listings will bring in new cash and drum up business in the city….Nonetheless, for China the prudent policy is to try to speed up the development of the mainland’s financial capabilities so that it is less exposed to potential American punishment…Italso means another big push to boost the global role of the yuan and reduce China’s dependence on the dollar…

Excerpts from Hong Kong: Conduit’s End, Economist, June 6, 2020

Selling War Services: the Mercenaries

Despite a UN treaty banning mercenaries, their day is far from over. Some analysts think there are now more of them in Africa than ever. But can they ever be a force for good?  ….In the years after most African countries gained independence, mercenaries were notorious for supporting secessionist movements and mounting coups. 

Western governments have in the past winked at mercenary activity that served their commercial interests. But nowadays Russia is seen as the leading country egging on mercenaries to help it wield influence. It does so mainly through Wagner, ***whose founder, Yevgeny Prigozhin, is close to President Vladimir Putin.

Wagner has been hired to prop up a number of shaky African regimes. In Sudan it tried to sustain the blood-drenched dictatorship of Omar al-Bashir. He was ousted last year after big protests. In 2018 hundreds of Wagner men arrived in the Central African Republic to guard diamond mines, train the army and provide bodyguards for an embattled president, Faustin-Archange Touadéra. In Guinea, where Rusal, a Russian aluminium giant, has a big stake, Wagner has cosied up to President Alpha Condé, who has bloodily faced down protests against a new constitution that lets him have a third term in office. In Libya, despite a un arms embargo, Wagner is reported to have deployed 800-1,200 operatives in support of a rebel general, Khalifar Haftar, who has been trying to defeat the UN-recognised government….

Mercenaries have three main advantages over regular armies. First, they give plausible deniability. Using them, a government such as Russia’s can sponsor military action abroad while pretending not to. Second, they tend to be efficient, experienced, nimble and flexible. Third, they are cheaper than regular armies. Whereas soldiers receive lifelong contracts and pensions, mercenaries are often paid by the job..

***Other firms include Dyke Advisory Group (DAG) , OAM Middle East

See also The UN Working Group on the Use of Mercenaries

Excerpts from Soldiers of misfortune: Why African governments still hire mercenaries, Economist, May 30, 2020

Japan’s Nuclear Bombs

On May 13, Japan’s Nuclear Regulation Authority announced that the nuclear fuel reprocessing plant in Rokkasho, Aomori Prefecture, had met new safety standards created after the March 11, 2011, earthquake and tsunami….The Rokkasho plant is a 3.8 million square meter facility designed to reprocess spent nuclear fuel from the nation’s nuclear reactors.  Construction began in 1993. Once in operation, the plant’s maximum daily reprocessing capacity will be a cumulative total of 800 tons per year.  During reprocessing, uranium and plutonium are extracted, and the Rokkasho plant is expected to generate up to eight tons of plutonium annually.

Both are then turned into a mixed uranium-plutonium oxide (MOX) fuel at a separate MOX fabrication plant, also located in Rokkasho, for use in commercial reactors. Construction on the MOX facility began in 2010 and it’s expected to be completed in 2022.  Japan had originally envisioned MOX fuel powering between 16 and 18 of the nation’s 54 commercial reactors that were operating before 2011, in place of conventional uranium.  But only four reactors are using it out of the current total of nine officially in operation. MOX fuel is more expensive than conventional uranium fuel, raising questions about how much reprocessed fuel the facilities would need, or want.

The Rokkasho reprocessing plant can store up to 3,000 tons of spent nuclear fuel from the nation’s power plants on-site. It’s nearly full however, with over 2,900 tons of high-level waste already waiting to be reprocessed.

Why has it taken until now for the Rokkasho plant to secure approval from the nuclear watchdog?   Decades of technical problems and the new safety standards for nuclear power that went into effect after the 2011 triple meltdown at the power plant in Fukushima Prefecture have delayed Rokkasho’s completion date 24 times so far. It took six years for the plant to win approval under the post-3/11 safety standards…By the time of the NRA announcement on May 13, 2020, the price tag for work at the Rokkasho plant had reached nearly ¥14 trillion.

Japan is the only non-nuclear weapons state pursuing reprocessing. But as far back as the 1970s, as Japan was debating a nuclear reprocessing program, the United States became concerned about a plant producing plutonium that could be used for a nuclear weapons program.  The issue was raised at a Feb. 1, 1977, meeting between U.S. Vice President Walter Mondale and Prime Minister Takeo Fukuda.  “Reprocessing facilities which could produce weapons grade material are simply bomb factories,” noted a declassified U.S. State Department cable on the meeting. “We want to cooperate (with Japan) to keep the problem under control.”

The U.S. oppose the Rokkasho plant’s construction in 1993, following an agreement in 1988 between the two countries on nuclear cooperation. ..The U.S.-Japan nuclear agreement meant the U.S. would give advance consent for Japan to send spent nuclear fuel to the United Kingdom and France — states with nuclear weapons — for reprocessing until Rokkasho was running at full-scale.

Currently, Japan has nearly 45 tons of plutonium stockpiled, including 9 tons held by domestic utilities. Another 21.2 tons is in the United Kingdom and France is holding 15.5 tons under overseas reprocessing contracts.

Thus, Japan finds itself caught between promises to the international community to reduce its plutonium stockpile through reprocessing at Rokkasho, and questions about whether MOX is still an economically, and politically, viable resource — given the expenses involved and the availability of other fossil fuel and renewable energy resources.

Excerpts from Aomori’s Rokkasho nuclear plant gets green light but hurdles remain, Japan Times, May 31, 2020

Facebook Mobs and Facebook Profits

A Facebook team had a blunt message for senior executives. The company’s algorithms weren’t bringing people together. They were driving people apart. “Our algorithms exploit the human brain’s attraction to divisiveness,” read a slide from a 2018 presentation. “If left unchecked,” it warned, Facebook would feed users “more and more divisive content in an effort to gain user attention & increase time on the platform.”

That presentation went to the heart of a question dogging Facebook almost since its founding: Does its platform aggravate polarization and tribal behavior?  The answer it found, in some cases, was yes.  Facebook had kicked off an internal effort to understand how its platform shaped user behavior and how the company might address potential harms… 

But in the end, Facebook’s interest was fleeting. Mr. Zuckerberg and other senior executives largely shelved the basic research, according to previously unreported internal documents and people familiar with the effort, and weakened or blocked efforts to apply its conclusions to Facebook products…

An idea [proposed by those who wanted to reduce polarization at Facebook] was to tweak recommendation algorithms to suggest a wider range of Facebook groups than people would ordinarily encounter.  Building these features and combating polarization could have come, though, at the cost of lower engagement and it was “antigrowth” [meaning less profits for Facebook].

Excerpt from Jeff Horwitz and Deepa Seetharaman, Facebook Executives Shut Down Efforts to Make the Site Less Divisive, WSJ, May 26, 2020

Strangling China with Hong Kong: the Politics of Fear

The U.S. determination  that Hong Kong is no longer autonomous from mainland China, under the Hong Kong Policy Act of 1992, will have significant implications for the city’s exporters and businesses.  Sensitive U.S. technologies could no longer be imported into Hong Kong, and the city’s exports might be hit with the same tariffs levied on Chinese trade.

But the act doesn’t cover the far more extensive role Hong Kong plays as China’s main point of access to global finance.  As of 2019, mainland Chinese banks held 8,816 trillion Hong Kong dollars ($1.137 trillion) in assets in the semiautonomous city, an amount that has risen 373% in the last decade…. China’s banks do much of their international business, mostly conducted in U.S. dollars, from Hong Kong. With Shanghai inside China’s walled garden of capital controls, there is no obvious replacement.

While the U.S. doesn’t directly control Hong Kong’s status as a financial center, Washington has demonstrated its extensive reach over the dollar system, with penalties against Korean, French and Lebanese financiers for dealing with sanctioned parties. The U.S. recently threatened Iraq’s access to the New York Federal Reserve, demonstrating a growing willingness to use financial infrastructure as a tool of foreign policy.  Even though the U.S. can’t legislate Hong Kong’s ability to support Chinese banks out of existence, the role of an international funding hub is greatly reduced if your counterparties are too fearful to do business with you.

Putting the ability of Chinese banks to conduct dollar-denominated activities at risk would be deleterious to China’s ability to operate financially overseas, posing a challenge for the largely dollar-denominated Belt and Road global infrastructure initiative. It would also put the more financially fragile parts of the country, like its debt-laden property developers, under strain.  China’s hope to develop yuan into an influential currency also centers on Hong Kong’s remaining a viable global financial center—more than 70% of international trade in the yuan is done in the city.

Excerpts from Mike Bird, How the US Could Really Hurt China, WSJ, May 290, 2020

Mining the Moon: The First Mover Advantage

The US government is starting to lay down the groundwork for diplomacy on the moon. On 15 May, 2020 NASA administrator Jim Bridenstine released a set of principles that will govern the Artemis Accords on the exploration of the moon. The accords are named after NASA’s Artemis programme, the US initiative to explore the moon, with a planned launch of astronauts to the lunar surface in 2024. Other countries are also increasingly turning towards the moon, which is concerning when a landing on the moon can send up clouds of potentially hazardous dust that travel a long way across the surface and even into orbit…

At the moment, there is little practical international law governing activities on the moon. The Outer Space Treaty of 1967 deals with general space exploration, while the more specific Moon Agreement of 1984 states that “the moon and its natural resources are the common heritage of all mankind”, prohibiting the ownership of any part of the moon or any resources from the moon….However, no nation capable of human space flight has signed the Moon Agreement, effectively rendering it moot. In fact, in April 2020, US president Donald Trump issued an executive order supporting moon mining and taking advantage of the natural resources of space.

The Artemis Accords aim to protect historic locations like the Apollo landing sites but encourage mining in other areas. They also promote transparency and communication between nations, requiring signatories to share their lunar plans, register any spacecraft sent to or around the moon and release scientific data to the public.  That transparency requirement might be a stumbling block for potential parties to the accords, says Forczyk. “I really don’t know how much countries are going to be willing to share some of their more delicate, sensitive information,” she says. “

The rest of the stipulations of the Artemis Accords are about safety: nations will be able to set “safety zones” to protect their activities on the moon, they will have to work to mitigate the effects of debris in orbit around the moon and they will agree to provide emergency assistance to any astronauts in distress.

Rather than attempting to put together an international treaty, which could be difficult to negotiate before NASA’s next crewed launch to the moon, the US will sign bilateral agreements with individual countries.

Excerpts from Leah Crane, NASA’s Artemis Accords aim to lay down the law of the land on the moon, New Scientist, May 20, 2020

Builiding a Nuclear War Chest: the US Uranium Reserve

The US electricity production from nuclear plants hit at an all-time high in 2019… generating more than 809 billion kilowatt-hours of electricity, which is enough to power more than 66 million homes.  Yet, despite operating the largest fleet of reactors in the world at the highest level in the industry, US ability to produce domestic nuclear fuel is on the verge of a collapse.  

Uranium miners are eager for work, the United States’s only uranium conversion plant is idle due to poor market conditions, and its inability to compete with foreign state-owned enterprises (most notably from China and Russia) is not only threatening US energy security but weakening the ability to influence the peaceful uses of nuclear around the world. Restoring America’s Competitive Nuclear Energy Advantage was recently released by the U.S. Department of Energy (DOE) to preserve and grow the entire U.S. nuclear enterprise…. The first immediate step in this plan calls for DOE to establish a uranium reserve.   Under the Uranium Reserve program, the DOE Office of Nuclear Energy (NE) would buy uranium directly from domestic mines and contract for uranium conversion services. The new stockpile is expected to support the operation of at least two US uranium mines, reestablish active conversion capabilities, and ensure a backup supply of uranium for nuclear power operators in the event of a market disruption [such as that caused the COVID-19 pandemic]. 

NE will initiate a competitive procurement process for establishing the Uranium Reserve program within 2021.  Uranium production in the United States has been on a steady decline since the early 1980s as U.S. nuclear power plant operators replaced domestic uranium production with less expensive imports. State-owned foreign competitors, operating in different economic and regulatory environments, have also undercut prices, making it virtually impossible for U.S. producers to compete on a level-playing field.  As a result, 90% of the uranium fuel used today in U.S. reactors is produced by foreign countries.

Establishing the Uranium Reserve program is exactly what United States needs at this crucial time to de-risk its nuclear fuel supply. It will create jobs that support the U.S. economy and strengthen domestic mining and conversion services….The next 5-7 years will be a whirlwind of nuclear innovation as new fuels and reactors will be deployed across the United States.

Excerpts  from USA plans revival of uranium sector, World Nuclear News, May 12, 2020.  See also Building a Uranium Reserve: The First Step in Preserving the U.S. Nuclear Fuel Cycle, US Office of Nuclear Energy, May 11, 2020.

Will Saudi Arabia Own the United States?

In the coronavirus pandemic’s financial fallout, Saudi Arabia’s $300 billion sovereign-wealth fund has emerged as one of the world’s biggest bargain hunters, taking minority stakes worth billions of dollars in American corporations.  Saudi Arabia’s Public Investment Fund  (PIF)  in the first quarter of 2020 bought shares valued at about half a billion dollars each in Facebook, Walt Disney,  Marriott International,  and Cisco Systems.  The fund bought financial stocks, investing $522 million in Citigroup, and $488 million in Bank of America while also spending $714 million on a stake in Boeing…Crown Prince Mohammed bin Salman, the kingdom’s day-to-day ruler, tasked the sovereign-wealth fund in 2015 with diversifying the country’s economy away from oil by investing in companies and industries untethered to hydrocarbons.

PIF’s recent buying spree highlights a bold strategy of piling into global stocks even as the novel coronavirus and a crash in oil prices mean that Saudi Arabia’s financial position is now the most precarious in a decade. The Saudi government in May 2020 tripled its value-added tax rate and cut subsidies to state employees as it contends with lower oil revenue and an economy weakening under coronavirus lockdown.

Many of the stocks that PIF has targeted are trading at historic lows, bruised by the fallout from the coronavirus and rock-bottom oil prices that have battered stocks of energy companies in 2020. Teh PIF bought in 2020 undisclosed stakes in a bevy of energy companies, including Equinor (Norway), Royal Dutch Shell, Total (France) and Eni (France). The PIF invested $484 million in Shell, $222 million in Total and previously unreported stakes of $828 million in BP $481 million in Suncor Energy and $408 million in Canadian Natural Resources.

It also purchased shares valued at roughly $80 million each in: Warren Buffett’s Berkshire Hathaway; chipmakers Broadcom and Qualcom ; IBM; drugmaker Pfizer;  Starbucks; railroad company Union Pacific; outsourcer Automatic Data Processing; and Booking.com….On top of the stakes in public companies, PIF is also awaiting regulatory approval for a roughly £300 million ($363 million) buyout of U.K. Premier League soccer team Newcastle United.

Excerpts from Rory Jones and Summer Said, Saudi Sovereign-Wealth Fund Buys Stakes in Facebook, Boeing, Cisco Systems, WSJ, May 18, 2020

Nuclear Operators: Who Helps India and Pakistian with their Atomic Bombs

Using open-source data, the nonprofit Centre For Advance Defense Studies (C4ADS) report published in April 2020 provides one of the most comprehensive overviews of networks supplying the rivals, in a region regarded as one of the world’s most dangerous nuclear flashpoints.

To identify companies involved, C4ADS analysed more than 125 million records of public trade and tender data and documents, and then checked them against already-identified entities listed by export control authorities in the United States and Japan. Pakistan, which is subject to strict international export controls on its programme, has 113 suspected foreign suppliers listed by the United States and Japan. But the C4ADS report found an additional 46, many in shipment hubs like Hong Kong, Singapore and the United Arab Emirates. The father of Pakistan’s atomic bomb, AQ Khan, admitted in 2004 to selling nuclear technology to North Korea, Iran and Libya. He was pardoned a day later by Pakistani authorities, which have refused requests from international investigators to question him.

India has a waiver that allows it to buy nuclear technology from international markets. The Indian government allows inspections of some nuclear facilities by the International Atomic Energy Agency, but not all of them. C4ADS identified 222 companies that did business with the nuclear facilities in India that had no IAEA oversight. Of these, 86 companies did business with more than one such nuclear facility in India.

Both countries are estimated to have around 150 useable nuclear warheads apiece, according to the Federation of American Scientists, a nonprofit group tracking stockpiles of nuclear weapons.

Excerpts from Alasdair Pal, Exclusive: India, Pakistan nuclear procurement networks larger than thought, study shows, Reuters, Apr. 30, 2020

Wasted Energy: Methane Leakage in Permian Basin


The methane over the Permian Basin emitted by oil companies’ gas venting and flaring is double previous estimates, and represents a leakage rate about 60% higher than the national average from oil and gas fields, according to the research, which was publishe in the journal Science Advances. Methane is the primary component of natural gas. It also is a powerful driver of climate change that is 34 times more potent than carbon dioxide at warming the atmosphere over the span of a century. Eliminating methane pollution is essential to preventing the globe from warming more than 2 degrees Celsius (3.6 degrees Fahrenheit)—the primary target of the Paris climate accord, scientists say.

The researchers used satellite data gathered in 2018 and 2019 to measure and model methane escaping from gas fields in the Permian Basin, which stretches across public and private land in west Texas and southeastern New Mexico. The leaking and flaring of methane had a market value of nearly $250 million in April 2020.

Methane pollution is common in shale oil and gas fields such as those in the Permian Basin because energy companies vent and burn off excess natural gas when there are insufficient pipelines and processing equipment to bring the gas to market. About 30% of U.S. oil production occurs in the Permian Basin, and high levels of methane pollution have been recorded there in the past. Industry groups such as the Texas Methane and Flaring Coalition have criticized previous methane emission research. The coalition has repeatedly said (Environmental Defense Fund) EDF’s earlier Permian pollution data were exaggerated and flawed.

The Texas Railroad Commission, which regulates the oil and gas industry in Texas, allows companies to flare and vent their excess gas. The commission didn’t respond to a request for comment.

The use of satellites to measure methane is a different approach than the methods used by federal agencies, including the EPA, which base their estimates on expected leakage rates at oil and gas production equipment on the ground. A “top-down” approach to measuring methane using aircraft or satellite data almost always reveals higher levels of methane emissions than the EPA’s “bottom-up” approach.

Excerpts from Permian Oil Fields Leak Enough Methane for 7 Million Homes, Bloomberg Law, Apr. 22, 2020,

Crude Oil in the Bile of Fish: BP Horizon Oil Spill

Since the 2010 BP oil spill, marine scientists at the University of South Florida (USF) have sampled more than 2,500 individual fish representing 91 species from 359 locations across the Gulf of Mexico and found evidence of oil exposure in all of them, including some of the most popular types of seafood. The highest levels were detected in yellowfin tuna, golden tilefish and red drum. The study represents the first comprehensive, Gulf-wide survey of oil pollution launched in response to the Deepwater Horizon spill.

Over the last decade have examined the levels of polycyclic aromatic hydrocarbons (PAHs), the most toxic chemical component of crude oil, in the bile of the fish. Bile is produced by the liver to aid in digestion, but it also acts as storage for waste products.

“We were quite surprised that among the most contaminated species was the fast-swimming yellowfin tuna as they are not found at the bottom of the ocean where most oil pollution in the Gulf occurs,” said lead author Erin Pulster…Pulster says it makes sense that tilefish have higher concentrations of PAH because they live their entire adult lives in and around burrows they excavate on the seafloor and PAHs are routinely found in Gulf sediment. However, their exposure has been increasing over time, as well as in other species, including groupers, some of Florida’s most economically important fish. …

Oil pollution hot spots were also found off major population centers, such as Tampa Bay, suggesting that runoff from urbanized coasts may play a role in the higher concentrations of PAHs. Other sources include chornic low-level releases from oil and gas platforms, fuel from boats and airplanes and even natural oil seeps — fractures on the seafloor that can ooze the equivalent of millions of barrels of oil per year.

Excerpts from Firste Gulf of Mexico-wide survey of oil pollution completed 10 years after Deepwater Horizon, Science Daily, Apr. 15, 2020

Naked Commercial Whaling and Toxic Whale Meat

Scientific “research” was also the reason Japan’s government gave for continuing to kill whales in the vast Southern Ocean after a global moratorium on commercial whaling came into force in 1985. But international criticism along with environmental groups’ attempts to sabotage the annual hunt proved too costly to Japan’s reputation and purse (the government bankrolled the hunt). In late 2018 Japan declared it was giving up killing in the Southern Ocean .

The Southern Ocean is now a sanctuary. But it comes at a cost. Japan walked out of the International Whaling Commission (IWC), accusing the anti-whaling members of failing to appreciate the cultural significance of whaling in Japan and of imposing their values on others. Freed from the IWC’s strictures, the government said commercial whaling would resume in Japan’s own extensive waters. But…whaling in home waters is troubling. Most whale populations in the Southern Ocean are healthy. In Japanese waters, stocks are less bountiful….

The whaling lobby is powerful in Japan. For now, the subsidies continue, supposedly to help ease the switch to nakedly commercial whaling but they coud be gone in two or three years. Other fleets complain that whaling gets far more than its fair share of subsidies for fisheries.

The challenges are immense. Whalemeat consumption has fallen from 230,000 tonnes a year in the early 1960s to 3,000 tonnes today, and whale is no longer cheap. Local whales have higher accumulations of toxins (such as a mercury) than those in the Southern Ocean. One packager of sashimi admits he sources his whale meat from Norway.

Excertps from Japan wants to catch whales. But who will eat them?, Economist, Apor. 25, 2020

Made in China, Always? COVID-19, the Survival of Resilience

As they walk through the valley of the shadow of death brought by COVID-19 chief executives and corporate strategists are beginning to look to the post-covid world to come. What they think they see, for good or ill, is an acceleration. Three existing trends—the deglobalisation unpicking the business world that grew up in the 2000s; the infusion of data-enabled services into ever more aspects of life; a consolidation of economic power into the hands of giant corporations—look likely to proceed at a faster rate than before, and perhaps to go further, too…

China’s government may encourage its state-owned firms to go global by buying distressed car companies in Europe. The share price of Daimler is less than half what it was when Geely, a Chinese carmaker, bought a 10% stake in 2018. Car companies may also see offers from technology giants keen to improve co-operation between metal bashers and the engineers of autonomy—currently wary at best. The healthier airlines, such as Qantas and IAG, owner of British Airways, will snap up airport slots from their bankrupt rivals and may try to acquire others only just staying aloft. Private-equity firms, which have mountains of committed investor cash, may start buying up fundamentally sound but impecunious suppliers in various industries, aware that when demand returns such companies will see its first fruits…

In 2019 many global firms sought to reduce their dependency on China. One of their favoured strategies was to put more business into factories elsewhere in Asia.  But the acute stage of China’s covid-19 crisis made it clear how essential China remains as a provider of inputs to such factories elsewhere in Asia and around the world. “What people thought was a global supply chain was a Chinese supply chain,”…

Joerg Wuttke, president of the EU Chamber of Commerce in China, says that if there is one lesson people are drawing from the pandemic in this regard it is that “single source is out and diversification is in.” In other words, companies do not just need suppliers outside China. They need to build out their choice of suppliers, even if doing so raises costs and reduces efficiency

Excerpts from Sinking, Swimming and Surfing, Economist,  Apr. 11, 2020, at 13

Can Traditional Medicine Cure COVID-19? China’s Take

Around the world officials are advising people to be wary of alternative treatments for covid-19. The opposite is true in China, where remedies known as traditional Chinese medicine (TCM) are being heavily promoted by the state. In January 2020, as the crisis escalated, the health ministry listed TCM treatments among those it recommended for the disease. It sent nearly 5,000 specialists to Hubei to administer them to patients (including sufferers at a sports centre in Wuhan that was turned into a TCM hospital for people with mild symptoms). Now China is keen to promote its remedies abroad.  TCM practitioners have joined Chinese medical teams sent to help manage outbreaks in Cambodia, Iraq and Italy. In mid-March, 2020 state media quoted a Tanzanian health official saying that China’s use of TCM for covid-19 may be “a model” for Africa to follow…

The use of animals in TCM sometimes involves appalling cruelty. One of the TCM remedies that the health ministry has recommended for use in the treatment of covid-19 patients includes powdered bear bile. In China this is often extracted from live bears kept in grim farms even though its active ingredient can be created synthetically. In February 2020 China banned the sale of wild animals as food—close contact in markets between live specimens and merchants may have helped the coronavirus to leap from animal to human. But the new rules do not prevent trappers and breeders from selling animal parts for use in TCM.

Officials do not say that traditional remedies can cure covid-19. But they do claim that TCM can reduce death rates by preventing patients with mild or moderate symptoms from developing more serious ones. They also say that TCM can speed up recovery. A website set up by China Daily, a state newspaper, called “Fighting covid-19 the Chinese way”, says that TCM can “remove the trash which causes illness”, leaving the virus “no room to survive”.

Excerpts from Fighting it the Chinese Way: Traditional Medicine, Economist, Apr. 11, 2020

A Nasty Divorce: US-China Internet Cables

United States officials granted Google permission to turn on a high-speed internet link to Taiwan but not to the Chinese territory of Hong Kong, citing national-security concerns in a ruling that underscores fraying ties between Washington and Beijing.“There is a significant risk that the grant of a direct cable connection between the United States and Hong Kong wouldpose an unacceptable risk to the national security and law enforcement interests of the United States,” the U.S. Department of Justice said in its decision, which was backed by the departments of Homeland Security and Defense. The agencies instead urged the Federal Communications Commission to grant Google owner Alphabet  permission to start using the portion of its 8,000-mile underwater Pacific Light cable that connects California to Taiwan. .

The decision threatens to end Hong Kong’s dominance as a top destination for U.S. internet cables and puts at risk several ongoing projects, including a Facebook backed fiber-optic line linking Los Angeles to Hong Kong and a Google-backed project linking Hong Kong to the U.S. territory of Guam.

Washington is turning to the self-ruling island of Taiwan, which the U.S. supports with arms sales and unofficial political ties despite Beijing’s claims that it is part of China. U.S. officials are also considering alternatives such as Indonesia, Philippines, Thailand, and Vietnam.

Google and Facebook originally teamed up to build Pacific Light to Hong Kong in 2016, continuing the Silicon Valley giants’ long-term strategy to take more control of the network pipes that connect their data centers. The web companies and their Chinese investment partners kept building the cable even as U.S. authorities withheld the regulatory approvals they needed to start using it.

Major international data projects are subject to review by Team Telecom, a coalition of federal agencies with national-security oversight. The panel has taken a hard line against China in recent years. Team Telecom in 2018 recommended for the first time the denial of a Chinese application—that of China Mobile —to provide telecom services through U.S. networks, citing national-security and law-enforcement concerns.

President Trump on April 4 2020 signed an executive order that puts the attorney general in charge of overseeing Team Telecom and gives the panel direct authority to review existing licenses to provide such services, including those issued earlier to Chinese state-owned operators China Telecom and China Unicom.

Excerpts from Drew FitzGerald and Kate O’Keeffe, U.S. Allows Google Internet Project to Advance Only if Hong Kong Is Cut Out, WSJ, Apr. 9, 2020

Plastic Bags Back in Vogue: Blame COVID or Plastics Industry?

Plastic bags may make a temporary comback in some places because of COVID-19.
In a setback, albeit temporary, for efforts to combat plastic waste, many state and local governments have suspended plastic bag bans and are prohibiting the use of reusable bags to stem the spread of COVID-19. The plastics industry is pushing for such measures, causing environmentalists to cry foul. San Francisco, which has been at the forefront of single-use plastics restrictions, issued an order “not permitting customers to bring their own bags, mugs, or other reusable items from home” as a measure “to prevent unnecessary contact.” Maine is delaying enforcement of its plastic bag ban to Jan. 15, 2021, after originally planning to roll it out on April 22—Earth Day….

The plastics industry has been advocating for such measures. In recent weeks, Bag The Ban, an initiative sponsored by the American Recyclable Plastic Bag Alliance, has endorsed editorials in newspapers such as the Boston Herald and the New Hampshire Union Leader advocating use of plastic bags to protect grocery workers from COVID-19.

Writing to the US Department of Health and Human Services, the Plastics Industry Association made a similar point. “Single-use plastic products are the most sanitary choice when it comes to many applications.” The association cited research on reusable bags, including a 2011 study from Loma Linda University and the University of Arizona that tested bags from shoppers selected randomly at the grocery store and found bacteria such as E. coli on 8% of them. It also pointed to a 2012 outbreak of norovirus in Oregon linked to use of a reusable food bag and cited a 2019 study from Portugal that found bacteria in bags.

Alexander H. Tullo, Plastic bag bans rolled back for COVID-19, Apr. 7, 2020

U.S. Desperation for Face Masks: Wild West or Piracy?

From Europe to South America, U.S. allies are complaining about the superpower’s “Wild West” tactics in outbidding or blocking shipments to buyers who have already signed deals for vital medical supplies. …”Money is irrelevant. They pay any price because they are desperate,” one high-level official in German Chancellor Angela Merkel’s ruling CDU/CSU group told Reuters….In April 5, 2020, US President Trump said he was signing a directive to stop the export of N95 respirator masks, which provide essential protection for health-care workers, and other U.S. medical equipment. Furthermore, 3M, a US company, said that the White House had ordered it to stop all shipments to Canada and Latin America of respirators that it manufactures in the U.S., despite what 3M called “significant humanitarian implications.”

In another case, an order of 200,000 masks bound for Germany was diverted to the U.S….Germany’s Secretary of Interior Andreas Geisel called it an “act of modern piracy.” He stated that: “even in times of global crisis, you shouldn’t use Wild West methods.”

U.S. allies complain of ‘Wild West’ tactics in race for medical supplies, Reuters, April 56, 2020

Can’t Treat Covid-19 with Flip-Flops

The U.S. Covid-19 response remains a work in progress—fragmented, chaotic, and plagued by contradictory messaging from political leaders, [such as the flip-flops on the use of face masks, see Stop Buying Face Masks , Learn How to Make Your Own Face Mask]. …

 “We don’t have a national plan,” says epidemiologist Michael Osterholm of the University of Minnesota, Twin Cities. “We are going from press conference to press conference and crisis to crisis … trying to understand our response.”…Even if lockdowns succeed at halting the virus…. the United States needs to marshal massive resources to monitor for new outbreaks and quickly contain them…. Identifying cases and contacts and isolating them will require a huge increase in public health workers at the local level….The absence of nationwide coordination highlights the division of legal power between the federal and state governments…. Governors, not federal officials, typically hold police powers to shut businesses and enforce curfews. But many are reluctant to invoke those powers and suffer the political costs without clear direction from above….“The closest comparison here, in terms of national mobilization, is a war. And there is no way the United States would fight a war as 50 separate states.”

Excerpts from United States Strains to Act as Cases Set Record, Science Magazine, Apr. 3, 2020, at 6488.

Genes that Atttack Plastic

A common fixture in refrigerators, furniture and footwear, polyurethane plastic is pretty much always in high demand. Humans worldwide cycle through millions of tons of the durable substance each year, sending the bulk of what’s not recycled to garbage dumps, where it leaks toxic chemicals into the environment as it very slowly breaks down. At least one of Earth’s organisms sees the stuff as a boon: a bacterial strain called Pseudomonas sp.TDA1. This polyurethane-munching microbe seems to thrive in waste dump sites. Studying the Pseudomonas strain and the chemical strategies it deploys could someday help researchers put a small dent in the world’s plastic problem, which has cumulatively saddled the planet with more than 8 billion tons of slow-degrading synthetic material.

Pseudomonas sp. TDA1 is one of only a few microbes known to be tolerant to polyurethane plastic’s typically toxic properties. What’s more, the bacteria doesn’t just withstand the plastic’s harsh ingredients: it uses some of them as a food source… But while the bacterium can metabolize a subset of the chemicals in polyurethane plastic, it doesn’t seem able to break down these products completely. In-depth studies of Pseudomonas sp. TDA1 will reveal the genes crucial to these plastic-attacking abilities. Understanding how these genes and their products work could help scientists engineer synthetic approaches to tackling plastic in the future.

Excerpts from Katherine J. Wu, Scientists Discover Plastic-Munching Microbe in Waste Site, SMITHSONIANMAG.COM, Mar. 31, 2020

Better Alive than Dead: The Crocodile Trade

Around 6m tonnes of bush meat are thought to come out of the Congo Basin each year… The trade has emptied out parts of the forest; 39% of it is at severe risk of over-hunting, the study says. Everything from bonobos (an endangered species of ape) to cobras, antelopes and, occasionally, elephants, appear at market stalls in Mbandaka.

Over-hunting has made life more dangerous for crocodile hunters. The number of dwarf crocodiles, once common in the Congo river, is dwindling. So hunters have to chase the ferocious Nile crocodile instead. There are plenty of those. Their scaly bodies stretch to six metres and they often kill humans. Stalkers in canoes go after them at night, shining a torch while stirring the water. “The crocodile does not like that,” says Mr Nyalowala. “He begins to writhe and then comes to attack.” As the animal pounces so do its pursuers, spearing it.

A live crocodile fetches more than a dead one in the markets in Mbandaka, so hunters bind their jaws and transport them some 200km downstream in their canoes. They sell for around $150 each. A teacher at a state school, by comparison, earns around $170 a month, though many did not get paid at all last year.

Croc in the pot: The toils and spoils of Congo’s crocodile-killers, Economist, Mar. 19, 2020

Sewers: Turning Wastewater into a Valuable Resource

The world’s growing flows of wastewater offer a largely untapped, potentially lucrative source of energy, agricultural fertilizers, and water for irrigation. The opportunities will increase as the annual volume of wastewater—now 380 billion cubic meters—expands by an estimated 51% by 2050, as populations and incomes multiply, says a team led by researchers at United Nations University’s Institute for Water, Environment, and Health. About 13% of global demand for fertilizer could be met by recovering nitrogen, phosphorus, and potash from wastewater; such use provides a bonus, diverting nutrients from waterways, where they can create harmful eutrophication. Sewage also offers an alternative energy source…..

Reaping Resources from Sewers, Science, Feb. 7, 2020

Human and Environmental Costs of Low-Carbon Technologies

Substantial amounts of raw materials will be required to build new low-carbon energy devices and infrastructure.  Such materials include cobalt, copper, lithium, cadmium, and rare earth elements (REEs)—needed for technologies such as solar photovoltaics, batteries, electric vehicle (EV) motors, wind turbines, fuel cells, and nuclear reactors…  A majority of the world’s cobalt is mined in the Democratic Republic of Congo (DRC), a country struggling to recover from years of armed conflict…Owing to a lack of preventative strategies and measures such as drilling with water and proper exhaust ventilation, many cobalt miners have extremely high levels of toxic metals in their body and are at risk of developing respiratory illness, heart disease, or cancer.

In addition, mining frequently results in severe environmental impacts and community dislocation. Moreover, metal production itself is energy intensive and difficult to decarbonize. Mining for copper,and mining for lithium has been criticized in Chile for depleting local groundwater resources across the Atacama Desert, destroying fragile ecosystems, and converting meadows and lagoons into salt flats. The extraction, crushing, refining, and processing of cadmium can pose risks such as groundwater or food contamination or worker exposure to hazardous chemicals. REE extraction in China has resulted  threatens rural groundwater aquifers as well as rivers and streams.

Although large-scale mining is often economically efficient, it has limited employment potential, only set to worsen with the recent arrival of fully automated mines. Even where there is relative political stability and stricter regulatory regimes in place, there can still be serious environmental failures, as exemplified by the recent global rise in dam failures at settling ponds for mine tailings. The level of distrust of extractive industries has even led to countrywide moratoria on all new mining projects, such as in El Salvador and the Philippines.

Traditional labor-intensive mechanisms of mining that involve less mechanization are called artisanal and small-scale mining (ASM). Although ASM is not immune from poor governance or environmental harm, it provides livelihood potential for at least 40 million people worldwide…. It is also usually more strongly embedded in local and national economies than foreign-owned, large-scale mining, with a greater level of value retained and distributed within the country. Diversifying mineral supply chains to allow for greater coexistence of small- and large-scale operations is needed. Yet, efforts to incorporate artisanal miners into the formal economy have often resulted in a scarcity of permits awarded, exorbitant costs for miners to legalize their operations, and extremely lengthy and bureaucratic processes for registration….There needs to be a focus on policies that recognize ASM’s livelihood potential in areas of extreme poverty. The recent decision of the London Metals Exchange to have a policy of “nondiscrimination” toward ASM is a positive sign in this regard.

A great deal of attention has focused on fostering transparency and accountability of mineral mining by means of voluntary traceability or even “ethical minerals” schemes. International groups, including Amnesty International, the United Nations, and the Organisation for Economic Co-operation and Development, have all called on mining companies to ensure that supply chains are not sourced from mines that involve illegal labor and/or child labor.

Traceability schemes, however, may be impossible to fully enforce in practice and could, in the extreme, merely become an exercise in public relations rather than improved governance and outcomes for miners…. Paramount among these is an acknowledgment that traceability schemes offer a largely technical solution to profoundly political problems and that these political issues cannot be circumvented or ignored if meaningful solutions for workers are to be found. Traceability schemes ultimately will have value if the market and consumers trust their authenticity and there are few potential opportunities for leakage in the system…

Extended producer responsibility (EPR) is a framework that stipulates that producers are responsible for the entire lifespan of a product, including at the end of its usefulness. EPR would, in particular, shift responsibility for collecting the valuable resource streams and materials inside used electronics from users or waste managers to the companies that produce the devices. EPR holds producers responsible for their products at the end of their useful life and encourages durability, extended product lifetimes, and designs that are easy to reuse, repair, or recover materials from. A successful EPR program known as PV Cycle has been in place in Europe for photovoltaics for about a decade and has helped drive a new market in used photovoltaics that has seen 30,000 metric tons of material recycled.

Benjamin K. Sovacool et al., Sustainable minerals and metals for a low-carbon future, Science, Jan. 3, 2020

Beauty Secrets: Donkeys Exterminated for their Skin Collagen

Over the past 6 years, Chinese traders have been buying the hides of millions of butchered donkeys from developing countries and shipping them to China, where they’re used to manufacture ejiao, a traditional Chinese medicine… Ejiao, in use for thousands of years, purportedly treats or prevents many problems, including miscarriage, circulatory issues, and premature aging, although no rigorous clinical trials support those claims. The preparation combines mineral-rich water from China’s Shandong province and collagen extracted from donkey hides, traditionally produced by boiling the skins in a 99-step process. Once reserved for China’s elites, ejiao is now marketed to the country’s booming middle class, causing demand to surge

Despite government incentives for new donkey farmers, farms in China can’t keep up with the exploding demand, which the Donkey Sanctuary currently estimates at 4.8 million hides per year. Donkeys’ gestation period is one full year, and they only reach their adult size after 2 years. So the industry has embarked on a frenzied hunt for donkeys elsewhere. This has triggered steep population declines. In Brazil, the population dropped by 28% between 2007 and 2017, according to the new report.

African populations are crashing, too, says Philip Mshelia, an equine veterinarian and researcher at Ahmadu Bello University in Zaria, Nigeria. After buying donkeys at markets, traders often drive large herds to slaughter, sometimes covering hundreds of kilometers with no rest, food, or water. Those transported by truck fare worse: Handlers tie their legs together and sling them onto piles or strap them to the top of the truck, Mshelia says. Animals that survive the journey—many with broken or severed limbs—are unloaded by the ears and tails and tossed in front of a slaughterhouse. Some meet their end in an open field where humans await them with hammers, axes, and knives.

For donkey owners, selling their animal means quick cash—now more than $200 in parts of Africa…

Ironically, the booming ejiao trade, along with a developing donkey dairy industry in Eastern Europe, has stirred scientific interest in donkeys.  Zhen Shenming, a reproductive biologist at the China Agricultural University in Beijing, says Chinese efforts are focused on increasing yields, for instance through artificial insemination…Chinese breeders are also testing new nutrition programs that expedite growth, leading to an adult-size donkey in only 18 months…

“They are very observant and sentient animals, and they create very strong bonds with other donkeys.” That’s one reason the current slaughtering practice, in which the animals often await their turn while watching other donkeys being beaten unconscious, slaughtered, and skinned is abhorrent.  “They’re certainly quite well aware of what’s happening and what’s to come,” McLean says. 

Excerpts from Christa Lesté-Lasserre Donkeys face worldwide existential threat, Science,  Dec. 13, 2019

Left to their Own Bad Devices: the Future of Ogoni Land in Nigeria

The decades-overdue clean-up of Ogoniland, after years of oil spills from the pipelines that criss-cross the region, is finally under way. But the billion-dollar project — funded by Nigeria’s national oil company and Royal Dutch Shell — is mired in allegations of corruption and mismanagement.  “We are not pleased with what is going on,” said Mike Karikpo, an attorney with Friends of the Earth International and a member of the Ogoniland team that negotiated the creation of the Hydrocarbon Pollution Remediation Project (Hyprep), the government body running the clean-up… 

Nigeria is Africa’s biggest oil producer, pumping out about 1.8m barrels per day. It provides roughly 90 per cent of the country’s foreign exchange and more than half of government revenues.  The clean-up began only the summer 2019, about a year after the first of an expected five tranches of $180m in funding was released to Hyprep. Mr Karikpo complains of a lack of transparency, alleging that planning, budgeting and awarding of contracts took place behind closed doors. Work started at the height of the rainy season, washing away much of the progress as contaminated soil collected for treatment was swept back into the environment…

Ogoniland, like the broader Niger Delta, has become more polluted and development has stalled, with little to show for the billions of dollars in crude that has been extracted. Critics have now accused Hyprep of being, like much of Nigeria’s oil sector, a vehicle for political patronage and graft. This year 16 companies were awarded contracts for the first phase of the clean-up, which — to the consternation of critics — focuses on the least contaminated parts of Ogoniland.

An investigation by the news site Premium Times found that almost all the companies were set up for other purposes, including poultry farming, car sales and construction, and had no experience of tackling oil pollution.  Meanwhile, insiders have questioned Hyprep’s capacity to handle such a massive project…

Shell and Hyprep have rejected the criticism.  Shell, which closed its Ogoniland operations in 1993, said it accepted responsibility “for spills arising from its operations”, but that some of the blame for the pollution must go to thieves who illegally tapped into pipelines and makeshift refining operations in the Delta’s creeks

Excerpts from Craft and Mismanagement Taint Nigeria’s Oil CleanUp, Financial Times, Dec. 29, 2019

540 Katrina Oil Spills Equal an Exxon Valdez Disaster

The federal agency overseeing oil and gas operations in the Gulf of Mexico after hurricane Katrina reported that more than 400 pipelines and 100 drilling platforms were damaged. The U.S. Coast Guard, the first responder for oil spills, received 540 separate reports of spills into Louisiana waters. Officials estimated that, taken together, those leaks released the same amount of oil that the highly publicized 1989 Exxon Valdez disaster spilled into Alaska’s Prince William Sound — about 10.8 million gallons…

While hurricanes gain speed due to the effects of climate change, the push for oil leasing in the Gulf of Mexico shows no sign of slowing down. In 2014, the Obama administration opened up 40 million new acres in the Gulf for oil and gas development. Four years later, the Trump administration announced plans to open up most of the rest, in what would be the largest expansion of offshore oil and gas drilling in U.S. history. Many of these 76 million acres are to be offered at reduced royalty rates to encourage additional near-shore drilling in Louisiana waters…

“In the Gulf, storms are predicted to be less frequent but more intense when they do come,” said Sunshine Van Bael, an ecologist at Tulane University who evaluated damage to marsh ecosystems from the BP oil spill. “One thing that storms do is, if oil has been buried underneath the marsh because it wasn’t rehabilitated, a storm could come along and whip that back up to the surface. So, the aftereffects of the oil spills might be greater [with climate change] since the storms are predicted to be more intense.”…

In 2009, a class-action lawsuit against Murphy Oil Corp. ended in a settlement requiring the company to pay $330 million to 6,200 claimants, including owners of about 1,800 homes in St. Bernard Parish. The damage occurred when one of Murphy’s storage tanks floated off its foundation during Katrina and dumped over a million gallons of crude oil into a square-mile segment of Meraux and Chalmette….

To date, more than $19 million has been paid out from the federal Oil Spill Liability Trust Fund to reimburse at least two oil companies for costs they incurred cleaning up oil they spilled during Katrina…

“We don’t normally penalize [companies] for act of God events,” Greg Langley of the Department of Environmental Quality said. “We just get right to remediation.”

Excerpts from Joan Meiners, How Oil Companies Avoided Environmental Accountability After 10.8 Million Gallons Spill, ProPublica, Dec. 27, 2019

How Sand Extraction Damages Ecosystems

The world uses nearly 50bn tonnes of sand and gravel a year—almost twice as much as a decade ago. No other natural resource is extracted and traded on such an epic scale, bar water. Demand is greatest in Asia, where cities are growing fast (sand is the biggest ingredient in concrete, asphalt and glass). China got through more cement between 2011 and 2013 than America did in the entire 20th century (the use of cement is highly correlated with that of sand).

Since the 1960s Singapore—the world’s largest importer of sand—has expanded its territory by almost a quarter, mainly by dumping it into the sea. The OECD thinks the construction industry’s demand for sand and gravel will double over the next 40 years. Little wonder then that the price of sand is rocketing. In Vietnam in 2017 it quadrupled in just one year.

In the popular imagination, sand is synonymous with limitlessness. In reality it is a scarce commodity, for which builders are now scrabbling. Not just any old grains will do. The United Arab Emirates is carpeted in dunes, but imports sand nonetheless because the kind buffeted by desert winds is too fine to be made into cement. Sand shaped by water is coarser and so binds better. Extraction from coastlines and rivers is therefore surging. But according to the United Nations Environment Programme (UNEP), Asians are scooping up sand faster than it can naturally replenish itself. In Indonesia some two dozen small islands have vanished since 2005. Vietnam expects to run out of sand this year.

All this has an environmental cost. Removing sand from riverbeds deprives fish of places to live, feed and spawn. It is thought to have contributed to the extinction of the Yangzi river dolphin. Moreover, according to WWF, a conservation group, as much as 90% of the sediment that once flowed through the Mekong, Yangzi and Ganges rivers is trapped behind dams or purloined by miners, thereby robbing their deltas both of the nutrients that make them fecund and of the replenishment that counters coastal erosion. As sea levels rise with climate change, saltwater is surging up rivers in Australia, Cambodia, Sri Lanka and Vietnam, among other places, and crop yields are falling in the areas affected. Vietnam’s agriculture ministry has warned that seawater may travel as far as 110km up the Mekong this winter. The last time that happened, in 2016, 1,600 square kilometres of land were ruined, resulting in losses of $237m. Locals have already reported seeing dead fish floating on the water.

 
Curbing sand-mining is difficult because so much of it is unregulated. Only about two-fifths of the sand extracted worldwide every year is thought to be traded legally, according to the Global Initiative Against Transnational Organised Crime. In Shanghai miners on the Yangzi evade the authorities by hacking transponders, which broadcast the positions of ships, and cloning their co-ordinates. It is preferable, of course, to co-opt officials. Ministers in several state governments in India have been accused of abetting or protecting illegal sand-mining. “Everybody has their finger in the pie,” says Sumaira Abdulali of Awaaz Foundation, a charity in Mumbai. She says she has been attacked twice for her efforts to stop the diggers.

Excerpts from Bring me a nightmare: Sand-Mining, Economist, Jan. 18, 2019

Viva Over-Fishing! Addicted to Over-Consumption of Fish

In 2015 world leaders signed up to a long list of sustainable development goals, among them an agreement to limit government subsidies that contribute to overfishing. Negotiators at the World Trade Organisation (wto) were told to finish the job “by 2020”. They have missed their deadline. Overfishing is a tragedy of the commons, with individuals and countries motivated by short-term self-interest to over-consume a limited resource. By one measure, the share of fish stocks being fished unsustainably has risen from 10% in 1974 to 33% in 2015.

Governments make things worse with an estimated $22bn of annual subsidies that increase capacity, including for gear, ice, fuel and boat-building. One study estimated that half of fishing operations in the high seas (waters outside any national jurisdiction) would be unprofitable without government support.

 Trade ministers were supposed to sort it all out at WTO meeting in December in Kazakhstan. But the meeting was postponed till June 2020. Moreover, the murky nature of subsidies for unregulated and unreported fishing makes their work unusually difficult. Governments do not have lines in their budget that say “subsidies for illegal fishing”, points out Alice Tipping of the International Institute for Sustainable Development, a think-tank.

Negotiators are trying to devise a system that would alert governments to offending boats, which would become ineligible for future subsidies. That is tangling them up in arguments about what to do when a boat is found in disputed territory, how to deal with frivolous accusations and how to treat boats that are not associated with any country offering subsidies.

When it comes to legal fishing of overfished stocks, it is easier to spot the subsidies in government budget lines, but no easier to agree on what to do about them. America and the European Union, for example, have been arguing over whether to allow subsidies up to a cap, or whether to ban some subsidies and take a lenient approach to the rest. The EU favours the second option, arguing that where fisheries are well-managed, subsidies are not harmful. To others this looks like an attempt to ensure any eventual deal has loopholes.

Further complicating matters is a long-running row about how to treat developing countries. All WTO members agree that some need special consideration. But as an American representative pointed out at a recent WTO meeting, 17 of the world’s 26 most prolific fishing countries are developing ones. That means broad carve-outs for them would seriously weaken any deal.

China, both the world’s biggest fisher and biggest subsidiser of fishing, has proposed capping subsidies in proportion to the number of people in each country who work in the industry. But it is the world leader here, too, with 10m at the last count (in 2016). Other countries fear such a rule would constrain China too little.

Excerpts from The World Trade Organization: What’s the Catch, Economist, Jan 4, 2020

Over Your Dead Body: the Creation of Internet Companies

Jeff Kosseff’s “The Twenty-Six Words That Created the Internet” (2019) explains how the internet was created. The 26 words are these: “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” They form Section 230 of the Communications Decency Act, itself a part of the Telecommunications Act of 1996.   Section 230 shields online platforms from legal liability for content generated by third-party users. Put simply: If you’re harassed by a Facebook user, or if your business is defamed by a Yelp reviewer, you might be able to sue the harasser or the reviewer, assuming you know his or her identity, but don’t bother suing Facebook or Yelp. They’re probably immune. That immunity is what enabled American tech firms to become far more than producers of content (the online versions of newspapers, say, or company websites) and to harness the energy and creativity of hundreds of millions of individual users. The most popular sites on the web—YouTube, Twitter, Facebook, eBay, Reddit, Wikipedia, Amazon—depend in part or in whole on user-generated content…

Because of section 230, the U.S. was able to cultivate online companies in ways that other countries—even countries in the developed world—could not….American law’s “internet exceptionalism,” as it’s known, is the source of mind-blowing technological innovation, unprecedented economic opportunity and, a great deal of human pain. The book chronicles the plights of several people who found themselves targeted or terrorized by mostly anonymous users… Each of them sued the internet service providers or websites that facilitated these acts of malice and failed to do anything about them when alerted. And each lost—thanks to the immunity afforded to providers by Section 230.

Has the time come to delete the section?

Excerpt from Barton Swaim, ‘The Twenty-Six Words That Created the Internet’ Review: Protecting the Providers, WSJ, Aug. 19, 2019

Electronic Waste: The Death of Your Phone and the Duty to Resuscitate It

E-waste is the fastest-growing element of the world’s domestic waste stream, according to a 2017 report by the UN’s Global E-waste Monitor. Some 50m metric tonnes will be produced annually in 2020 — about 7kg for every person in the world. Just 20 per cent will be collected and recycled.  The rest is undocumented, meaning it likely ends up in landfill, incinerated, traded illegally or processed in a substandard way. That means hazardous substances spilling into the environment, poisoning the ground and people living nearby.

Heavy metals such as mercury, lead and cadmium — commonly found in LCD screens,  refrigerators and air-conditioning units — as well as chemicals such as CFCs and flame retardants  found in plastics can contaminate soil, pollute water and enter the food chain.  Research last year by Basel Action Network, an NGO, linked toxic e-waste shipped from Europe to  contaminated chicken eggs in Agbogbloshie — a Ghanaian scrapyard where 80,000 residents subsist by retrieving metals from electrical waste. Eating just one egg from a hen foraging in the scrapyard would exceed the European Food Safety Authority’s tolerable daily intake for chlorinated dioxins 220-fold.

Some appliances are more likely to be recycled than others. The recycling rate for big appliances, such as fridges and cookers, is about 80 per cent. That is because they are harder to dispose of and eventually get picked up, even when they are dumped by the kerb. Of small appliances, however,  barely one in five makes it to the recycling centre.  Across the world, governments are trying different ways to reduce e-waste and limit the amount that ends up in landfill.

For some time, EU countries have operated a one-for-one take-back system — which means that distributors need to take back, for free, an older version of any equipment they sell you. But since the rapid rise of online retailers, this has been harder to implement

In the end, all e-waste needs to be reduced to core metals. “It’s a bit like a mining activity.” In certain recycling  plants robots have been programmed to dismantle flatscreen TVs, extracting  precious metals such as cobalt or lithium, whose deposits are limited and increasingly valuable.  “One of the hardest things about recycling is that you are not sure how [the manufacturers] made  it.”   Companies are encouraged  to include this information on their devices. It could be a  file with instructions readable by robots that could then proceed with the dismantling, making the process “easier, cheaper and more circular”. However, manufacturers have so far kept a close guard on the design of their products.

Many pressure groups and lawmakers have concluded that improving recycling rates will not be  sufficient to tackle the global e-waste problem. Increasingly, they are advocating for the right to repair. In October 2019, the EU adopted a package of design measures to make household appliances more repairable.  Starting from March 2021, manufacturers selling certain household appliances will have to ensure  that spare parts are available for a number of years after their product has launched; that their  items can be easily disassembled (and so use screws not glue); and that they provide access to  technical information to repair professionals.

The rules cover appliances including refrigerators, washing machines, dishwashers and televisions.  But they do not extend to IT equipment such as laptops, tablets and mobile phones.  “The road to a new product is very easy, and the road to a successful repair very difficult,” says  Martine Postma, founder and director of Repair Café International Foundation, which celebrated  its 10th anniversary last year. Since its first repair event in Amsterdam in 2009, the organisation  has grown to nearly 2,000 repair groups in 35 countries around the world.  Now, it wants to collect more data about electronic gadgets, to see if it can plot “weak points” in  design that could help manufacturers make them more repairable.

Excerpts from Aleksandra Wisniewska, What happens to your old laptop? The growing problem of e-waste, http://wiki.ban.org, Jan. 10, 2020

When the Fish are Gone: As Bad as it Could Get in the Yangtze River

China imposed a 10-year commercial fishing ban in January 2020  on the Yangtze – the first ever for Asia’s longest river – in a bid to protect its aquatic life.  Facing dwindling fish stocks and declining biodiversity in the 6,300km (3,915-mile) river, the Chinese government decided seasonal moratoriums were not enough. The ban will be applied at 332 conservation sites along the river. It will be extended to cover the main river course and key tributaries by January 1 2021, according to a State Council notice.   Dam-building, pollution, overfishing, river transport and dredging had worsened the situation for the waterway’s aquatic species.  Fishermen using nets with smaller holes and illegal practices such as the use of explosives or electrocution have also contributed to the river’s decline

 President Xi Jinping warned that the Yangtze River had become so depleted that its biodiversity index was as bad as it could get, saying it had reached what could be described as the “no fish” level… Back in 1954, the annual catch from the Yangtze was about 427,000 tonnes, but in recent years it had been less than 100,000 tonnes.
According to an official estimate, about 280,000 fishermen in 10 provinces along the Yangtze River will be affected by the ban. Their 113,000 registered fishing boats will be grounded or destroyed. The government has allocated funds to help those affected find alternative work and provide them with welfare and retraining. To counter illegal fishing, he said river authorities would be equipped with speedboats, drones and video surveillance systems. Fishermen would also be recruited to patrol the river.

Excerpts from China bans fishing in depleted Yangtze River for 10 years to protect aquatic life, South China Morning Post, Jan. 3, 2020

Swept Under the Rug: Radioactive Dust and Brine in the Oil Industry

A salty substance called  “brine,” is  a naturally occurring waste product that gushes out of America’s oil-and-gas wells to the tune of nearly 1 trillion gallons a year, enough to flood Manhattan, almost shin-high, every single day. At most wells, far more brine is produced than oil or gas, as much as 10 times more. Brine collects in tanks, and workers pick it up and haul it off to treatment plants or injection wells, where it’s disposed of by being shot back into the earth

The Earth’s crust is in fact peppered with radioactive elements that concentrate deep underground in oil-and-gas-bearing layers. This radioactivity is often pulled to the surface when oil and gas is extracted — carried largely in the brine…

Radium, typically the most abundant radionuclide in brine, is often measured in picocuries per liter of substance and is so dangerous it’s subject to tight restrictions even at hazardous-waste sites. The most common isotopes are radium-226 and radium-228, and the Nuclear Regulatory Commission requires industrial discharges to remain below 60 for each. Some brine samples registered combined radium levels above 3,500, and one was more than 8,500. “It’s ridiculous that those who haul brine are not being told what’s in their trucks,” says John Stolz, Duquesne’s environmental-center director. “And this stuff is on every corner — it is in neighborhoods. Truckers don’t know they’re being exposed to radioactive waste, nor are they being provided with protective clothing.

“Breathing in this stuff and ingesting it are the worst types of exposure,” Stolz continues. “You are irradiating your tissues from the inside out.” The radioactive particles fired off by radium can be blocked by the skin, but radium readily attaches to dust, making it easy to accidentally inhale or ingest. Once inside the body, its insidious effects accumulate with each exposure. It is known as a “bone seeker” because it can be incorporated into the skeleton and cause bone cancers called sarcomas. It also decays into a series of other radioactive elements, called “daughters.” The first one for radium-226 is radon, a radioactive gas and the second-leading cause of lung cancer in the U.S. Radon has also been linked to chronic lymphocytic leukemia.

Oil fields across the country — from the Bakken in North Dakota to the Permian in Texas — have been found to produce brine that is highly radioactive. “All oil-field workers,” says Fairlie, “are radiation workers.” But they don’t necessarily know it.

The advent of the fracking boom in the early 2000s expanded the danger, saddling the industry with an even larger tidal wave of waste to dispose of, and creating new exposure risks as drilling moved into people’s backyards. “In the old days, wells weren’t really close to population centers. Now, there is no separation,” says City University of New York public-health expert Elizabeth Geltman. In the eastern U.S. “we are seeing astronomically more wells going up,” she says, “and we can drill closer to populations because regulations allow it.” As of 2016, fracking accounted for more than two-thirds of all new U.S. wells, according to the Energy Information Administration. There are about 1 million active oil-and-gas wells, across 33 states, with some of the biggest growth happening in the most radioactive formation — the Marcellus. …

There is little public awareness of this enormous waste stream, the disposal of which could present dangers at every step — from being transported along America’s highways in unmarked trucks; handled by workers who are often misinformed and underprotected; leaked into waterways; and stored in dumps that are not equipped to contain the toxicity. Brine has even been used in commercial products sold at hardware stores and is spread on local roads as a de-icer

But a set of recent legal cases argues a direct connection to occupational exposure can be made… Pipe cleaners, welders, roughnecks, roustabouts, derrickmen, and truck drivers hauling dirty pipes and sludge all were exposed to radioactivity without their knowledge and suffered a litany of lethal cancers. An analysis program developed by the Centers for Disease Control and Prevention determined with up to 99 percent certainty that the cancers came from exposure to radioactivity on the job, including inhaling dust and radioactivity accumulated on the workplace floor, known as “groundshine.”

“Almost all materials of interest and use to the petroleum industry contain measurable quantities of radionuclides,” states a never-publicly released 1982 report by the American Petroleum Institute, the industry’s principal trade group, passed to Rolling Stone by a former state regulator. Rolling Stone discovered a handful of other industry reports and articles that raised concerns about liability for workers’ health. A 1950 document from Shell Oil warned of a potential connection between radioactive substances and cancer of the “bone and bone marrow.” In a 1991 paper, scientists with Chevron said, “Issues such as risk to workers or the general public…must be addressed.”

“There is no one federal agency that specifically regulates the radioactivity brought to the surface by oil-and-gas development,” an EPA representative says. In fact, thanks to a single exemption the industry received from the EPA in 1980, the streams of waste generated at oil-and-gas wells — all of which could be radioactive and hazardous to humans — are not required to be handled as hazardous waste. In 1988, the EPA assessed the exemption — called the Bentsen and Bevill amendments, part of the Resource Conservation and Recovery Act — and claimed that “potential risk to human health and the environment were small,” even though the agency found concerning levels of lead, arsenic, barium, and uranium, and admitted that it did not assess many of the major potential risks. Instead, the report focused on the financial and regulatory burdens, determining that formally labeling the “billions of barrels of waste” as hazardous would “cause a severe economic impact on the industry.”…

There is a perception that because the radioactivity is naturally occurring it’s less harmful (the industry and regulators almost exclusively call oil-and-gas waste NORM — naturally occurring radioactive material, or TENORM for the “technologically enhanced” concentrations of radioactivity that accumulate in equipment like pipes and trucks.”…

In Pennsylvania, regulators revealed in 2012 that for at least six years one hauling company had been dumping brine into abandoned mine shafts. In 2014, Benedict Lupo, owner of a Youngstown, Ohio, company that hauled fracking waste, was sentenced to 28 months in prison for directing his employees to dump tens of thousands of gallons of brine into a storm drain that emptied into a creek that feeds into the Mahoning River. While large bodies of water like lakes and rivers can dilute radium, Penn State researchers have shown that in streams and creeks, radium can build up in sediment to levels that are hundreds of times more radioactive than the limit for topsoil at Superfund sites. Texas-based researcher Zac Hildenbrand has shown that brine also contains volatile organics such as the carcinogen benzene, heavy metals, and toxic levels of salt, while fracked brine contains a host of additional hazardous chemicals. “It is one of the most complex mixtures on the planet,” he says…

“There is nothing to remediate it with,” says Avner Vengosh, a Duke University geochemist. “The high radioactivity in the soil at some of these sites will stay forever.” Radium-226 has a half-life of 1,600 years. The level of uptake into agricultural crops grown in contaminated soil is unknown because it hasn’t been adequately studied.

“Not much research has been done on this,” says Bill Burgos, an environmental engineer at Penn State who co-authored a bombshell 2018 paper in Environmental Science & Technology that examined the health effects of applying oil-field brine to roads. Regulators defend the practice by pointing out that only brine from conventional wells is spread on roads, as opposed to fracked wells. But conventional-well brine can be every bit as radioactive, and Burgos’ paper found it contained not just radium, but cadmium, benzene, and arsenic, all known human carcinogens, along with lead, which can cause kidney and brain damage.

Brine as dust suppressant

Ohio, because of its geology, favorable regulations, and nearness to drilling hot spots in the Marcellus, has become a preferred location for injection wells. Pennsylvania has about a dozen wells; West Virginia has just over 50. Ohio has 225. About 95 percent of brine was disposed of through injection as of 2014. Government scientists have increasingly linked the practice to earthquakes, and the public has become more and more suspicious of the sites. Still, the relentless waste stream means new permits are issued all the time, and the industry is also hauling brine to treatment plants that attempt to remove the toxic and radioactive elements so the liquid can be used to frack new wells.

Excerpts from America’s Radioactive Secret, Rolling Stone Magazine, Jan. 21, 2020

Out-of-Fashion: Aggressive Tax Planning

In December 2019, Royal Dutch Shell voluntarily published its revenue, profit, taxes and other business details in each of 98 countries. The disclosure aligns with a drive by the energy company, which often attracts criticism from environmental activists, to present itself as forward-thinking, transparent and socially-minded.  That didn’t stop the information feeding a predictable host of headlines in the U.K., where the company is partly based, that it didn’t pay taxes in the country (because of losses carried forward and tax refunds). In the U.S., Shell accrued $137 million of tax—a rate of 8%.  This kind of detailed reporting is required by tax authorities in about 100 countries including the U.S. since 2017, based on rules agreed by the Organisation for Economic Cooperation and Development, but it is rarely made public.

Companies that don’t jump may soon be pushed. Economy ministers from European Union countries are considering a proposal that would require all large companies with total revenue of more than €750 million ($834 million) operating in the bloc to publish the information annually. The Global Reporting Initiative, an organization that establishes sustainability standards, recently agreed to include a similar requirement. Greater transparency could also spur reform efforts and reduce incentives for complex tax arrangements. Companies, investors and states all agree that it is best to find a global solution to the problem of aggressive tax planning.

Excerpts from Rochelle Toplensky, Beginning of the End of Tax Secrecy, WSJ, Dec. 20, 2019

The Eco-Villain of the 2020s: Moving

[E]ven “green” transport risks becoming a villain… Transport has been the only sector in which greenhouse-gas emissions have consistently risen both in the U.S. and in the European Union… Road, aviation, waterborne and rail transportation put together now account for eight metric gigatons of carbon-dioxide equivalents, which is 24% of global greenhouse-gas emissions, according to the International Energy Agency. In the U.S. this figure rises to 34%….To be consistent with the existing Paris Agreement goals, transport emissions need to peak around 2020 and then fall around 70% relative to 2015 levels, estimates by the International Energy Agency show.

In theory, electric and plug-in hybrid vehicles chart a clear path to lower emissions. Even once the costs of making the batteries and generating the electricity that feeds them is taken into account, most estimates suggest that they emit roughly half as much greenhouse gases as a gasoline car. But recent experience proves that consumer tastes can easily sabotage steps toward sustainability: In the U.S., rising demand for pickup trucks has offset any gain from electric vehicles. And faster economic development in emerging nations will inevitably mean higher emissions, even if each vehicle pollutes less.

In China and India, the number of motorized vehicles per person quintupled and tripled, respectively, between 2007 and 2017, according to U.S. Department of Energy data. Catching up with U.S. levels of motorization—which admittedly are very high—both countries would need two billion extra vehicles. Even if 100% of those were electric, they would add more emissions on their own than the total level allowed by the Paris goals.

Greenhouse gases coming from aviation also keep surging despite the fact that planes are becoming increasingly fuel efficient because air traffic growth has surged. Furthermore, while environmental policies have tended to focus on passenger transport, this misses a big chunk of the picture, because almost half of transportation emissions now come from freight.

Adoption of rail, a cleaner alternative, isn’t picking up. Meanwhile ocean freight, which is by far the most efficient form of transport per ton mile, faces a reckoning from new rules that take effect in January 2020 because it relies on the dirtiest fuel to be so economical.

Excerpts from  Jon Sindreu, In the Green Transition, Transportation Is the Next Big Baddie, WSJ, Dec. 23, 2019

The Global Flows of Dirty Recyclables

For decades, America and much of the developed world threw their used plastic bottles, soda cans and junk mail in one bin. The trash industry then shipped much of that thousands of miles to China, the world’s biggest consumer of scrap material, to be sorted and turned into new products.  That changed last year when China banned imports of mixed paper and plastic and heavily restricted other scrap. Beijing said it wants to stimulate domestic garbage collection and end the flow of foreign trash it sees as an environmental and health hazard. Since then, India, Malaysia, Vietnam, Thailand and Indonesia—other popular markets for the West’s trash—have implemented their own restrictions…China’s 2018 restrictions on a variety of waste imports radically changed global flows of plastics, including polyethylene, a popular type used in shopping bags and shampoo bottles.

 
For years, the world’s bottles and boxes made their way to China on ships that offered deep discounts to avoid returning empty after dropping off cargo in the U.S. and other countries. Since 1992, China has imported 45% of the world’s plastic waste, according to data published in 2019 in the journal Science Advances. “It was a great relationship, where we bought their goods and sent them back the empty boxes,” says Brent Bell, vice president of recycling for Houston-based Waste Management, the largest waste management company in the U.S. In 2018, China instituted a ban on 24 categories of waste—including, for example, plastic clamshell containers, soda and shampoo bottles, and junk mail. It said foreign garbage was “provoking a public outcry.”

China accepted dirty and mixed recyclables because it had low-wage workers to sort out unwanted material, often by hand. That gave American contractors little incentive to weed out food scraps, plastic bags and nonrecyclable junk stateside. After China rejected imports, a flood of trash was rerouted to countries such as India, Indonesia and Malaysia. Many of those places now say they are overwhelmed and have imposed their own restrictions on paper or plastic imports. The countries also want to focus on developing their own waste collection industries.

Malaysia in May 2019 began sending back 60 containers of imported trash to the U.S. and other countries, complaining it had become a dumping ground for rich countries. The containers were meant to contain plastic scrap but were contaminated with other items such as cables and electronic waste. A government spokeswoman said more containers will be returned as Malaysia ramps up inspections.

Japan, which historically sent most of its plastic exports to China, had been redirecting trash to Malaysia, Thailand and Vietnam after China’s ban. But when those countries began turning dirty recycling away, Japanese collectors started stockpiling, in hopes a new market would arise. Over the past year, Japan has amassed 500,000 tons of plastic waste, according to Hiroaki Kaneko, deputy director of recycling at the environment ministry. Japan, the second-biggest exporter of plastic waste behind the U.S., is trying to stimulate domestic processing by earmarking billions of yen to subsidize plastic recycling machinery for private companies.

The U.K. is burning more of its trash, including dirty or low-value recycling. Attitudes toward incineration vary greatly by country. In the U.S., where space is plentiful, it has long been cheaper to send materials to landfills, and incineration has remained unpopular. Across much of Europe, by contrast, trash burned for energy has been popular for years. ….“The China ban has highlighted that we can no longer export our problem,” said managing director Bill Swan. Paper Round’s buyers have much higher standards now, he said, such as checking moisture levels, which can decrease the quality of paper.

Excerpts from Saabira Chaudhuri, Recycling Rethink: What to Do With Trash Now That China Won’t Take It, WSJ, Dec. 21, 2019

Does Fracking Cause Cancer? The Right to Know and the Duty to Protect

An increase in the number of teens and young adults diagnosed with a rare cancer in the southwest corner of Pennsylvania has caused the state to look for a link between fracking and the disease.The investigation was sparked by a spate of Ewing’s sarcoma cases in and around Washington County, which has more Marcellus Shale gas wells than any other county in the state. In April 2019 state Department of Health found that the cases didn’t constitute a statistically significant cancer cluster. But affected families and other residents lobbied the governor for an investigation.

 The region is home to coal mining, oil drilling, chemical plants and a former uranium-processing facility.  Each year, about 250 children in the U.S. are diagnosed with Ewing’s sarcoma, a rare cancer of the bone or surrounding soft tissue, according to the National Institutes of Health.  In four counties in southwest Pennsylvania, 31 people were diagnosed with Ewing’s sarcoma from 2006 through 2017, according to state cancer data. That is a roughly 40% increase from the period from 1995 through 2005, when 22 people in the same area were diagnosed, according to state data. Residents point to two additional cases in 2018. Most troubling to many local residents is that the six cases in Washington County since 2008 occurred in one school district.

Other communities are studying potential health risks of fracking. In October 2019, Colorado regulators said they would tighten regulation of drilling after a state-funded study found that people living within 2,000 feet of oil-and-gas wells could have, in worst-case scenarios, an elevated risk for infrequent, short-term health effects such as nosebleeds and headaches from emissions.

Evelyn Talbott, a professor of epidemiology at the University of Pittsburgh, said Pennsylvania investigators should look at residents’ potential exposures to chemicals and to radiation from natural-gas sites. She said they also should look at the sealed waste site of the defunct uranium-processing plant…Since Pennsylvania’s first Marcellus Shale well was drilled in Washington County in 2003, more than 1,800 wells have been fracked there. Compressor stations, processing plants and pipelines have followed. Some residents worry that pollutants such as benzene from air emissions or radium from wastewater could affect people’s health.

Kris Maher, Cancer Cases Raise Fracking Fears, WSJ, Dec. 21, 2019

See also Shale gas development and cancer incidence in southwest Pennsylvania

How to Pull off an Economic Coup: China in Guinea

The Simandou mine is a large iron mine located in the Simandou mountain range of southern Guinea, Simandou represents one of the largest iron ore reserves in Guinea and in the world, having estimated reserves of 2.4 billion tonnes of ore grading 65% iron meta. Since November 2019, Simandou is owned by a Chinese consortium: SMB, a joint-venture which includes Winning Shipping, a Singaporean maritime firm, UMS, a Guinean-French logistics company, and Shandong Weiqiao, a big Chinese aluminium producer. The entity, in which Guinea’s government holds a 10% stake, will pay $15bn to develop the site, build a new deepwater port and a 650km railway to link the two.

The successful bid is a coup for SMB, which is barely known outside the west African nation. The private joint-venture keeps its finances close to its chest but Bob Adam, an expert on mining in Guinea, reckons that after taxes, royalties and operating costs smb is making about $800m profit a year. “They are now the most significant economic enterprise in Guinea,” he says—and the only one among the world’s biggest bauxite producers with a direct link to China.

A shift into iron ore presents challenges. Building a port and a railway through the country’s malaria-infested forest will take years and could cost much more than the estimated $10bn. Also, the Boké region has been plagued by riots. Many local residents are angered by lack of access to clean water or health care. But China is keen on Simandou’s high-grade iron ore, which emits less pollution when processed.It also wants to lock in supply

Galvanised:  SMB Winning pays $15bn for rights to Guinea’s iron mountain, Economist, Dec. 7, 2019

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Imperfect Tools Used Imperfectly: 400 000 Malaria Deaths

According to a report, published on December 4th, 2019 by the World Health Organization,  there were 228 million cases of malaria in 2018, which resulted in 400,000 deaths. Most victims were young children in Africa. That is a far cry from targets set in 2015 for the near-elimination of malaria by 2030.  These targets depended on a $6 billion a year being poured into malaria-control efforts. Funding in recent years, however, has been about $3 billion a year. More money would surely help. But substantial gains can be made by doing things more efficiently—something at which malaria programmes have been dismal.

Stopping malaria relies on three things: insecticide-treated bed nets to prevent nocturnal mosquito bites; the spraying of homes with insecticides; and the treating of pregnant women and children with rounds of preventive medication. These are all “imperfect tools, often used imperfectly”, says Pedro Alonso, head of the malaria programme at the World Health Organisation. Countries usually deploy the same package of measures everywhere, even though infection rates and their seasonal patterns vary a lot between regions, and particularly between cities and the countryside. Transmission reaches a peak in the rainy season, when mosquitoes are abundant, so preventive mass-treatment of children then can make a huge difference. Regional variations are particularly pronounced in large countries like Nigeria—a place that, by itself, accounts for a quarter of the world’s malaria cases.

The typical approach of a malaria-control programme is to bombard a country with bed nets and then use whatever cash remains for sporadic rounds of preventive medication. But in many big cities, such as Dar es Salaam and Nairobi, cases are few and far between, so deploying nets there is a waste. Overspending on nets at the expense of other things happens partly because nets are easy to count—a feature that aid programmes are particularly fond of. Results which cannot be attributed directly to money a donor spends tend to fall further down that donor’s list of priorities. This kind of reasoning tips the scales, because foreign aid accounts for two-thirds of the money spent on malaria.

Excerpts from Tropical disease: Malaria infections have stopped falling, Economist, Dec. 7, 2019

The Biometrics Bonanza: Measuring and Identifying Humans

Many African  governments have unwisely bought biometric proprietary systems of private companies, meaning that they are forced to go back to the seller for maintenance, upgrades and new components. That can be expensive. When Nigeria wanted to use its own card-printing machines, the firm that had sold it software tried to insist that Nigeria buy its machines as well… They eventually got help from Pakistan, which had software that worked on any machine.

But there are signs of change coming from within the industry itself, spurred by developments in an entirely different part of the world: India. Like Africa, it is vast, poor and home to more than a billion people. Yet as a single country India has tremendous negotiating power. When India developed its “Aadhaar” identity programme it invited leading firms to bid—but with the caveat that they provide open-source software, or code that can be examined and changed by others. This allowed engineers to knit together different bits of a system such as databases, enrollment software, fingerprint scanners and so on. The suppliers agreed because they did not want to miss out on the biggest identity bonanza the world had ever seen. Moreover, India’s spending led to a big increase in production, which caused prices to fall across the industry.

Even as governments think about the technical problems of recording identity, they also need to grapple with the far more consequential ones around rights, governance and privacy. The starkest warning of the misuse of identity was in the Rwandan genocide, where ID papers listed ethnicity, making it easy to target Tutsis. Since data on religion and ethnicity are not needed to provide services, governments should not be hoovering it up.

States should also be wary of denying people their rights by creating a class of citizens without papers. In Kenya, for example, the government wants everyone to register for ID  cards, but it discriminates against members of the Nubian minority by forcing them to appear before a security panel to prove their nationality. Modern identity systems promise to bring many benefits to Africa. But as they proliferate, so too will the temptation for politicians to misuse them

Excerpts from Identity Documentation in Africa: Papers Please, Economist, Dec. 7, 2019

Ethical Mining 2020

Less than half of the world’s larger miners have released safety and environmental details about their mine-waste dams, showing the mixed success of investors’ demands for greater transparency after the deadly Brumadinho dam collapse in Brazil. In January, 2019, 270 people died following the collapse of a tailings dam owned by Brazil’s Vale SA. The incident prompted a coalition of investors who manage more than $13 trillion to ask 726 companies in the mining and oil-sands business to disclose information on their dams. Nearly 55% of companies hadn’t delivered as of November 2019. While some of the largest miners—including Vale, BHP , and Anglo American have disclosed their information, others have yet to do so. Investors are increasingly examining ethical issues when looking at mining.

Tailings, the waste material from extracting valuable minerals, are often held for decades behind dams that can be risky if they are poorly constructed, ill-maintained or filled with too much waste. Major failures of tailings dams have become more frequent as mining companies ramp up production to meet the world’s growing demand for commodities. Norilsk Nickel one of world’s most valuable miners with a market capitalization of roughly $43 billion, hasn’t publicly released details on its tailings dams. In 2016, heavy rainfall caused a Norilsk Nickel tailings dam in northern Russia to overflow, coloring a local river red. Miners of potash and phosphate—minerals used mainly in fertilizers—have been slow to disclose.

Another big company that has not released details is Canada-based Nutrient. Satellite images show two of the company’s six Saskatchewan mines are located a few miles from residential communities and one neighbors a bird-breeding area. A tailings pond at the company’s North Carolina phosphate mine is located next to the Pamlico River, which feeds into the state’s largest estuary.

In 2017, Israel Chemicals reported that the partial collapse of a subsidiary’s dike in Israel released 100,000 cubic meters of acidic wastewater that flowed into a nearby nature reserve. The wastewater resulted from the production of phosphate fertilizer.Vancouver-based Imperial Metals Corp.is tied to what is considered one of Canada’s worst environmental catastrophes. In 2014, a British Columbia dam owned by the company burst, sending some 25 million cubic meters of mining waste pouring into a pair of glacial lakes

Large Chinese miners such as Jiangxi Copper, Zijin Mining Group Co.  and Zhongjin Gold Corp. also haven’t shared information with the investor coalition. There are 8,869 documented tailings dams, of which 16% are within about half a mile of a residential area, school or hospital, according to research led by the School of University of Science and Technology in Beijing. Karen Hudson-Edwards, a mining specialist at Britain’s University of Exeter, said the actual number in China is estimated at around 12,000 dams and there is little transparency on tailings risk in the country. There have been at least 12 serious tailings-dam accidents in China since the 1960s, with one in 2008 killing 277 people, according to the World Information Service on Energy, a Netherlands-based nonprofit.

Alistair MacDonald et al, Many Mining Companies Fail to Provide Waste-Dam Data, WSJ, Dec. 18, 2019