Sechaba ka’Nkosi
INTERNATIONAL rights and aid organisations have called for a review of trading conditions for multinational companies in Africa to promote economic and social rights for the continent’s inhabitants.
Addressing the World Economic Forum Africa meeting in Cape Town last week, the organisations accused the international investor community of looting Africa and failing to take the continent’s developmental needs seriously.
It said governments should insist on rights such as education and health care, particularly for the youth, as a condition for making business on the continent.
“Young people are saying that business is rising at their expense,” said Amnesty International regional and youth activism director Edward Ndopu.
“Business and political leaders are focusing almost exclusively on economic growth, a measurement that ignores marginalisation and deep inequalities. The reality is that the African continent loses billions of dollars annually to illicit financial flows and corporate tax avoidance, robbing countries of resources that they could use for education, health care and the creation of opportunities for young people,” he said.
Amnesty specifically blamed large conglomerates for the continuing marginalisation of youths and women from the mainstream of economic activities on a continent rich with mineral resources. Ndopu said Amnesty international wanted the establishment of an independent continental body to monitor and track land acquisitions and forced evictions.
“Many people on the continent are forced out of their homes and thrown in the streets to make way for infrastructure projects that do not benefit them,” he said. “We must stop cheapening the lives of Africans in this way.”
Earlier, British-based aid organisation Oxfam accused multinational companies of failing to pay tax on nearly R500 billion income in 2010 alone, through a practice called mispricing where companies set artificial prices for goods and services sold between subsidiaries to avoid taxation.
The organisation said multinational companies had taken nearly R150bn out of Africa in 2010 alone, but failed to assist its member states in dealing with the outbreak of diseases such as Ebola.
Oxfam’s executive director Winnie Byanyima said international based companies had used complex tax avoidance structures and trade pricing to avoid paying their dues in countries where they were operating. Byanyima called on African leaders to introduce reforms that would make the companies accountable to areas where they operate.
“African leaders must not sit by while international tax reforms are agreed which give multinational companies free rein to sidestep their tax obligations in Africa,” Byanyima told delegates at the World Economic Forum Africa in Cape Town last week.
“Political and business leaders must put their weight behind the ever louder calls for the reform of global tax rules. African leaders must also introduce a more progressive and democratic approach to taxation – including calling a halt to tax exemptions for foreign companies,” she said.
Oxfam said the money lost through the complex tax avoidance structures amounted to six times the money needed to plug the health-care funding gap in Ebola affected countries of Sierra Leone, Liberia, Guinea and Guinea Bissau.
“Africa is haemorrhaging billions of dollars because multinational companies are cheating African governments out of vital revenues by not paying their fair share in taxes,” charged Byanyima.