Friday, January 30, 2015

Ethiopia aims to soothe Egypt fears over the Nile





Ahead of the upcoming African Union Summit in Addis Ababa, Ethiopia’s prime minister has sought to soothe Egyptian fears over the potential impact of the Grand Ethiopian Renaissance dam on the Arab country’s share of Nile River water.

In an interview conducted by Egyptian journalistAbdel Latif Elmenawy for Al Tahrir television channel on Wednesday, Prime Minister Hailemariam Desalegn said his country had “no reason” to make “the Egyptian people feel that they are threatened because of the Nile River.”
 
“We say that this is a God-given resource for all of us, and we have to use this resource in both a rational and reasonable way. That both Ethiopia develops and Egyptian people get their safe share to develop from the Nile water,” Desalegn said.
  
“I think we can share this resource without harming each other, without impeding Ethiopian development, without making insecurity in Egypt. We know that it is a bloodline. The Nile is a bloodline to Egypt. To the people of Egypt,” Desalegn added.

Egyptian President Abdel Fattah el-Sisi is expected to fly this week to Ethiopia to attend the African Union summit where he will meet with Prime Minister Desalegn in a rare opportunity for direct talks between the two countries.
  
Ethiopia - nicknamed “Africa’s water tower” - is the source of about 80 percent of Nile water, but Egypt is the most dependent on the river. Cairo fears that Ethiopia’s Grand Renaissance dam could cut its share of the water.

The legal framework that governs the management of the Nile is a 1929 treaty between Egypt and colonial Britain and a 1959 treaty between Egypt and Sudan. Ethiopia considers the arrangement to be unfair, because it was not colonized and Britain did not speak on its behalf.

The Ethiopian prime minister said Egypt should not be concerned about the Renaissance dam, saying: “There is a scientific way” of ensuring everyone gets their fair share of the water.

“The filling of the dam is scientifically determined, in what period of time whatever has to be decided.” 

He said his country has taken an initiative to establish an international panel of experts to study the impact of the dam on countries downstream from the structure, “especially Sudan and Egypt.”

He said he believed differences with Cairo could be resolved through dialogue, saying any use of threats on the part of Cairo would be a ‘failed strategy,’ referring to previous threats made by ousted president Mohammad Morsi.

“The era of the Egyptian leadership during the Muslim Brotherhood - especially president Mursi - was a tough time. A very complicated era, because you know a statesman, in a televised way, threatening Ethiopia that he was going to take military actions against us, which is an open televised statement,” the Ethiopian prime minister said.
  
“It is a failure, when you think to threaten a country militarily, it’s from the inception, it is a failed strategy.”

‘When al Sisi came to power we came to understand that he is a man of sincerity, a man of understanding, and also a man of genuine engagement with countries, with Ethiopia,” he added.

Sunday, January 25, 2015

Erdoğan's visit draws Ethiopian media's extensive attention




A recent visit to Ethiopia by Turkish President Recep Tayyip Erdogan continues to be fodder for Ethiopian media.

The Turkish President arrived in Ethiopian capital Addis Ababa on Thursday and his visit lasted for a day, but this one-day visit is proving to be an important topic for Ethiopian media on Saturday for the third day in a row.

Soon after Erdogan started his visit to Ethiopia and until now, the Amharic daily Addis Zemen, the English daily Ethiopian Herald and the Ethiopian Broadcasting Corporation, which runs both the state television and radio, a handful of newspapers and webpages, have been analyzing Turkish-Ethiopian relations.

These media outlets have also dwelt on the economic, political, social and diplomatic aspects of these relations as well as on the results of the one-day visit of the Turkish President to Addis Ababa.

During his visit, Erdogan was keen to highlight the fact that his country's relations with Ethiopia were not based on narrow interests.

He said Turkey was keen on offering technological assistance to Ethiopia so that the Horn of Africa state could benefit from its natural resources.

"We think that what we contribute to Ethiopia is very little compared to our love for the country," Erdogan said.

He described Ethiopia as Turkey's "gateway" to the African continent, noting that his country's relations with Ethiopia dated back to the Ottoman era.

Talks between Erdogan and Ethiopian Prime Minister, Hailemariam Desalegn, focused on means of bolstering relations between the two states in all fields.

The Turkish President said he had hoped to elevate Turkish-Ethiopian relations to people-to-people levels. 

Source: dailysabah.com

Egyptian dictator Sisi to head to Ethiopia within days


President Abdel Fatah al-Sisi - YOUM7

CAIRO:  President Abdel Fatah al-Sisi is heading to  Ethiopia within days to participate in the Egyptian-Ethiopian Business Forum conducted in Addis Ababa, Youm7 reported.

It added that a high-level delegation traveled to Addis Ababa Saturday night as part of the preparations before President Sisi arrives.

The summit is scheduled  to take place during from January 26 to 31.

Saturday night, Sisi returned from Saudi Arabia after offering his condolences to the new Saudi Monarch Salman bin Abdulaziz al-Saud over the death of late King Abdullah bin Abdulaziz al-Saud.

The presidency issued a statement after the meeting saying that Sisi offered his condolences on behalf of all the Egyptians; assuring that Egypt trusts that “King Salman will continue the rule of the kingdom,  leading it to the future in both nations’ interests.”

Source: thecairopost.com

Friday, January 23, 2015

Apply to theGlobal Forest Watch Small Grants Fund


Deadline: 1 March 2015

Global Forest Watch’s (GFW) Small Grants Fund (SGF) seeks to promote broad uptake and innovative use of Global Forest Watch by civil society around the world.

The SGF provides financial and technical support to empower civil society organizations to apply Global Forest Watch data and technology in support of their work to strengthen local forest management and conservation practices, conduct evidence-based advocacy and campaigning, and promote greater transparency in the forest sector.

Eligibility:

The Small Grants Fund seeks applications for projects that use or contribute to Global Forest Watch. Potential project concepts may include but are not limited to:

Using GFW to monitor, assess, or map forest landscapes to support sustainable forest management, law enforcement, biodiversity conservation, land use planning, and/or recognition of the forest tenure rights of local communities;

Using GFW to support evidence-based advocacy, campaigning, education, or training;

Increasing forest transparency by (a) promoting disclosure of geospatial data by companies, governments or communities, by (b) aggregating and surfacing existing forest data, or by (c) developing new geospatial data for GFW;

Using GFW for journalism or other evidence-based storytelling to support broad communication and to raise awareness about a specific issue;

Generating original, policy-relevant research or analysis to discern spatial or temporal trends in land use, forest change or drivers of deforestation;

Supporting baseline setting or measurement, reporting and verification (MRV) for REDD+ projects;

Building a customized app (web- or mobile-based tool) using GFW’s open source API;

Using GFW to support legal investigations and/or court cases related to forest crimes.

Eligibility is restricted to organizations that meet the following requirements:

Certified non-profit and non-governmental
Implementing projects at a regional, national or sub-national level
Annual budget of greater than $30,000 USD
Computerized financial systems for tracking and recording expenses

Ability to fill out an organizational assessment document (containing questions regarding organization finances) in fluent English

Other considerations: Although not required, special consideration will be given to projects that promote gender equity or benefit women, and to projects that support poverty reduction and/or social justice.

For more information, visit this link.

How to summarize a Full Proposal into a Short Concept Note


The submission of concept notes is increasingly becoming the first step in the application for funding to the main agencies and private donors. This is how your potential donor will make the first selection among a large group of project proposals to assess their potential. Accordingly, concept notes could be solicited directly by the donor, but they could also become the way in which an NGO approaches a potential sponsor to test their interest in the NGO’s ongoing activities. Thus, concept notes must be clear, specific, and attractive to the reader.
Concept notes are a shorter version of a project proposal and their length typically spans from 3 to 5 pages (if the sponsor you are approaching does not give a clear indication, keep it to 3 pages; the shorter the better). The main difficulty with writing concept notes is producing a summary that simultaneously catches the attention of the reader and elaborates the main issues at stake, all the while keeping the amount of information given at minimum. Do not overwhelm the reader. The concept notes must capture the audience’s attention and make your potential sponsor curious about your project, and willing to get to know you and your ideas better.
How to Summarize a Full Proposal into a Short Concept Note
Start with an eye-catching title.
First paragraph: background of the project. Explain why this project is important, for whom, and what has already been done in the selected field of intervention.
Second paragraph: objectives and beneficiaries. Limit your objectives to a maximum of three. Remember that your objectives must be connected to the background of the project. Once you have singled out the problems you are targeting, be specific about how your project will address these problems and what the desired results will be. It is important to be specific and clear about each of your objectives and explain who will benefit from the development of the project. Specify who your target group is, why it is important to work with this target group, and how the participants in the project will benefit from your activities. Remember that on the one hand, the target group will receive immediate benefits from the completion of the projects (such as attending workshops, training etc) but also the community will benefit from the various projects implemented by your NGO in the long run. Accordingly, write a sentence explaining how this project will benefit your community by looking at the big picture (you can address the social, political or economic situation of your community and link this project with the main goals of your NGO).
Third paragraph: outputs. For each of your objectives there must be an output. It is of crucial importance that the donor understands how your objectives are to be assessed in order to monitor the development of the project and its results; therefore outputs must be concrete and tangible.
Fourth paragraph: activities and duration. The activities are the ways in which your objectives will produce an output. Accordingly, activities must be concrete and they should give an idea of how you aim to reach a given goal. Importantly, each activity must have a beginning and end point, so make sure they all have a set duration, which will depend on the length of the overall project.
Fifth paragraph: monitoring and evaluation. How will the donor assess the results of your project? Elaborate on the methods necessary in order to enable your sponsor to monitor the development of the project and to evaluate its partial and final results in a practical way (how do you measure the fulfilment of set objectives?)
Include a budget only if specifically required.

Friday, January 16, 2015

How Scared Should You Be of Al Qaeda’s New Butt Bomb?



The most recent issue of al Qaeda’s 
magazine Inspirecontains what the editors call a special surprise: a recipe for a new kitchen-made bomb, which the magazine urges readers to use on American commercial aircraft.

Without going into excessive detail, the main ingredients of the bomb are a certain amount of an explosive substance derived from broken down matches (don’t buy all your matches at once! it urges) as well as a variety of other household ingredients like nail polish.

The end result is a bomb, about the size of a water bottle, filled with processed match powder and other chemicals. The magazine tells the reader to cover the bomb with about a half a centimeter of silicon to ensure that it doesn’t trigger detection at airport screening. But even with a healthy coat of silicon, it’s the sort of object that would show up under routine inspection or x-ray. So what’s a would-be terrorist to do to get their new kitchen bomb aboard a plane

First, don’t stick it in your underwear. That’s something that the Transportation Security Administration is on the lookout for, thanks to that 2009 incident when Umar Farouk Abdulmutallab, the so-called “Underwear Bomber,” attempted to blow up an Amsterdam to Detroit-bound airplane on Christmas Day. John Pistole, head of TSA, has said that Abdulmutallab was “very close” to executing the attack and would have gotten away with it if not for the fact that he was carrying around the device for weeks and hadn’t changed his underpants. “The efficacy was degraded,” Pistole remarked to the audible discomfort of the entire Aspen Security Forum in July. Eww. 

Al Qaeda learned a lesson from the experience. The magazine’s feature article on the newest bomb suggests that the would-be-bomber aspire to, shall we say, more ambitious measures to ensure concealment. In a piece for the Intercept, gloriously titled “Al Qaeda Claims New Butt Bomb,” reporters Jana Winter and Sharon Weinberger describe it this way:

“This time around…the Inspire article obliquely references the need to go where Abdulmutallab was perhaps unwilling to go, and place the bomb directly inside the terrorist’s body. The magazine cites the example of Abdullah al-Asiri, an AQAPmember who died in 2009 trying to kill a senior Saudi government official; al-Asiri reportedly hid the bomb in his rectal cavity.”

How safe are we from the new butt bomb?

Tal Hanan, a security and explosives expert at Demoman International in Israel said that the type of bomb featured in the article, which is also called a triacetone triperoxide orTATP explosive, “is more myth then operational tool.
“And we should encourage them to use it.”

TATP bombs aren’t new. Richard Reid, the so-called “Shoe Bomber,” attempted to use one in a December 2001 plot to blow up a plane flying from Paris to Miami. Because of the volatility of the chemicals involved, a would-be bomber has a very good chance of blowing up his kitchen in the cooking process, says Hanan. If the cook succeeds in making a bomb without losing his fingers, he would probably want to use the device sooner rather than later as the material becomes increasingly volatile as it dries. That increases the chances of explosive material remaining on the hands, where it could be detected via swab. (But that’s hardly a foregone conclusion.) 

If the bomber is able to get his device to the airport, wouldTSA be able to spot it at a checkpoint? Good chance. Even al Qaeda in the article acknowledges that the device could be detectable to millimeter wave scanners.

In 2007, TSA moved to install new screening technologies into airports across the country. The most famous of which is the so-called backscanner ray. It sends radiation through a person’s clothing where it bounces off the skin or other objects that have relatively high atomic density. This creates that grainy but revealing nude shot that’s become synonymous with invasive, mechanical airport screening. 


Less well known is millimeter wave scanning, which sends an electromagnetic wave between the 1 and 10 millimeter range toward the subject, passing through the person’s clothing. The beam bounces off of skin as well as explosive materials, cash and liquids. Most millimeter wave scanners are also equipped with automated target recognition software. That allows the machine to better identify strange objects, which most millimeter wave scanners display as little yellow boxes on the outline of the subject in a computerized display.
Here’s how TSA describes it:
“TSA currently uses millimeter wave [advanced imaging technology] to safely screen passengers for metallic and nonmetallic threats, including weapons and explosives, which may be concealed under clothing without physical contact to help TSA keep the traveling public safe.  There are close to 740 AIT units deployed at nearly 160 airports nationwide…All millimeter wave AIT units deployed at airports are outfitted with software designed to enhance passenger privacy by eliminating passenger-specific images and instead auto-detecting potential threats and highlighting their location on a generic outline of a passenger that is identical for all passengers.”
Hanan says that the device outlined in the Inspire article should actually be detectable to backscanner technology as well as millimeter wave scanning. “As it [is] not looking for the explosive, rather for foreign objects/containers concealed on the body… Regardless of the substance,” he said.
Here’s where things get intimate. Is there enough tissue protection in the body cavity  to shield the bomb from scanning radiation that doesn’t penetrate into the skin? Is today’s backscanner and millimeter wave scanner tech robust enough to catch a body bomb at a checkpoint, as Hanan claims, or is there an exploitable vulnerability, which what al Qaeda seems to be assuming?
As a general rule, security authorities won’t discuss the capabilities of detection technology in use at airports or other checkpoints. A U.S. government official directly involved in airport security screening told Defense One: “The issue is that what you’re asking hits at some of the most sensitive stuff with which the [Department of Homeland Security] is currently dealing.”
But al Qaeda has tried TATP bombs aboard passenger jets and failed, and that was before the wide implementation of better scanning technologies.  
The Critical Human Component of Border Protection

Hanan cautions that vigilance on the part of screening officials, and proper installation and use of screening tech, are more important factors in foiling bomb plots than any single piece of technology.

This is the one area on which DHS is willing to comment. On Monday, DHS Secretary Jeh Johnson said he had instructedTSA to undertake “an immediate, short-term review” of security and screening measures “to determine whether more is necessary, at both domestic and overseas last-point of departure airports.” He also announced that TSA would increase the number of random searches at airports.

“Previously, in July, I directed enhanced screening at certain foreign airports that are last points of departure to the United States. Since then, a number of foreign governments have themselves enhanced aviation security, buttressing and replacing our own measures at these airports,” he said.

In theory, vigilance on the part of border guards, coupled with correctly installed screening technologies, will catch a bomber trying to smuggle a water bottle-sized bomb onto a plane. The 1986 case of Anne-Marie Murphy demonstrated clearly that an astute guard is a better defense than any innovation in screening, Hanan said.

Murphy, an Irish-born woman who was five months pregnant at the time of what has come to be called the Hindawi Affair, attempted to smuggle 1.5 kilograms of highly explosive semtex onto a flight from London to Tel Aviv. Her Jordanian husband Nezar Nawwaf al-Mansur al-Hindawi placed the material in her luggage. She was caught simply because a border guard marked her as “suspicious,” despite Murphy not fitting any conventional profile. She was then subjected to additional screening.

The guard’s “training kicked in when this nice, innocent lady failed to make sense” in the way she answered questions, Hanan said. “Bored, poorly paid and poorly trained [security] cannot be replaced by technology, as good as it gets.”

Smuggling bombs onto airplanes is much more difficult than it was in 1986, more difficult even than a few years ago. Al Qaeda’s most recent device would be extremely dangerous to attempt to build, very difficult to transfer, may not work in practice, and has a good — but not perfect — chance of alerting security workers who have been given expanded authority to conduct screenings as well as at least one type of common security device, if not two.

In other words, you’re largely protected from the most recent al Qaeda bomb threat, but you’re really only as safe as theTSA agent standing in front of you.


The release becomes especially relevant in the context of the recent events in Paris. AQAP has taken credit for the attack that killed 12, including two police officers, at the headquarters of French satirical newspaper Charlie Hebdo. One of the two gunmen who stormed the building has been identified as having trained with AQAP.

AFRICA’S BORDERS SPLIT OVER 177 ETHNIC GROUPS, AND THEIR ‘REAL’ LINES AREN’T WHERE YOU THINK



BY CHRISTINE MUNGAI
If we were to redraw Africa’s borders to have each ethnic group in their own country, we would have at least 2,000 countries

Sign in Botswana: turn left for Namibia, right for Zimbabwe and Zambia. (Photo: Flickr/ Guitarfish). 
AFRICA’S arbitrary borders have done much to foment strife and instability on the continent. Partitioning communities, the argument goes, has led to artificial borders, ethnic struggles, and spurred civil conflict and underdevelopment.
Look at a map of Africa and you will notice the many clean lines. Nearly half (44%) of Africa’s borders are straight lines or follow lines of latitude or longitude, splitting at least 177 ethnic groups in two or more countries.
It’s obviously impractical to have all Africa’s ethnic groups with their own country, simply because Africa is such a diverse place. If we were to redraw Africa’s borders to have each ethnic group in their own country, we would have at least 2,000 countries.
Still, four in ten Africans today belong to an ethnic group that has kin across borders.
Having your community split by a border increases the risk of war, says this seminal study on the long-term effects of African borders, and makes conflict more deadly. One study showed that length of a conflict and its casualty rate is 25% higher in areas where an ethnicity is divided by a national border as opposed to areas where ethnicities have a united homeland.
There are several reasons for this high risk of conflict, the researchers say – partitioning tends to generate irredentist demands, where ethnicities that are minority groups in one country want to unify with their kin across the border.
For example, the Somali are split between five different countries – so apart from Somalia itself, Somalis can be found in northern Kenya, southern Ethiopia, Eritrea and Djibouti.
At least three wars since independence in the 1960s have been driven (partly at least) by the desire of Somalis in Ethiopia, Djibouti and Kenya to become part of Somalia. The Somali national flag is a white five-pointed star set against a blue background; the five points of the star represent these five “estranged” Somali groups.
Risk of conflict heightened
The risk of conflict is also heightened because split ethnicities may fight to gain independence or obtain automony; one historical study documented that around 20% of civil wars in Africa have a secessionist undertone.
Split groups are also more likely to be smaller, as a percentage of the total, in their respective countries, and so are likely to be marginalised and unable to access political power, and the benefits of patronage.


The Malinke of West Africa are among the most partitioned people in Africa, split into six different countries – Senegal, Guinea, Guinea-Bissau, Mali, Cote d’Ivoire and The Gambia.
Similarly, the Ndembu are split between Angola, Zaire, and Zambia; the Nukwe, between Angola, Namibia, Zambia, and Botswana, the Alur, between Uganda and DR Congo, and the Ibibio between Nigeria and Cameroon.
Silver lining
But there’s a silver lining to this seemingly gloomy story. You may not realise it – and African governments don’t give them enough credit – but border communities generate as much GDP as all of Africa’s offices and factories, only that it’s off the books.
Informal cross border trade represents 43% of the official GDP of the continent, thus being almost equivalent to the formal sector, according to data from the United Nations Economic Commission for Africa.
In some ways, people hardly recognise the arbitrary lines that separate them from their uncles, aunts, brothers and sisters living on the other side.
But in other ways, they are very keen to benefit from the opportunity, leveraging their mobility to make the most of price differences across borders.
One report from USAID estimates that each of about 3 million West African cross-border traders conducts an annual average of $20,000 in transactions, amounting to an aggregate amount of four billion dollars.
Overall informal exports to West Africa from Nigeria is estimated to be between $1.5 and $1.9 billion, and up to 15% of Nigeria’s imports enter Ghana informally, largely along the Benin–Nigeria border.
Livestock are some of the most informally traded commodities. In the Horn of Africa, cross border trade in camels through Ethiopia/Djibouti, South Sudan/north-western Kenya, and eastern Uganda/western Kenya is estimated to be worth $5million per year; informal trade in cattle represented more than 85% of total trade.
In this region, exports of livestock to neighbouring countries in fact at times exceed official trade by a factor of 30% or more, hence making up over 95% of total trade in livestock.
A similar study quoted by the African Development Bank noted that informal traders along the Kenya- Somalia borders were known to realise astounding growth of 500-700% in the value of their livestock and generated annual sales in excess of $11.7 million.
In Uganda, a more relaxed tax regime makes some goods in the country cheaper, leading to the curious phenomenon where goods can be imported to landlocked Uganda through Kenya, only to be re-exported to Kenya – doubling back of the same roads that they were imported through – and still sold for a profit!
Sudan and DR Congo are a major destination for Uganda’s informal exports, jointly accounting for 64%-74% of exports, largely comprising shoes, clothes, fish, beans, maize grain, flour, beer, medicines and alcohol.
A mountain of paperwork
Still, it’s not that these cross-border communities are intent on evading the law – following the legal channels is so incredibly tedious that it can be virtually impossible to comply, if your goods are ever to make it to market on time, before your tomatoes turn to mould.
In most African countries, there are two sets of documents to be filled on either side of a border, which means that the average customs transaction involves 20–30 different parties, 40 documents, 200 data elements (30 of which repeated at least 30 times), and the rekeying of 60-70% of all data at least once, according to the report from UNECA.
These administrative hurdles sharply increase trade costs (it is estimated that each day of delay at customs is equivalent to an additional 85km between the trading countries). They also encourage illicit trade and corruption in order to bypass delays at customs and border posts.
But African borders, formidable as they seem (officially), are actually not as robust in reality, particularly if there’s a common ethnic group living on both sides, as these communities are adept at squeezing through the cracks.
Generally, African governments generally adopt a “live-and-let-live” approach – even though the informal trade denies governments much-needed tax revenue, it provides even-more needed jobs.
The AfDB notes that the informal trade can have numerous knock-on effects, such as lessening the impact of food crises and help reducing price volatility, as well as give a greater availability of goods at affordable prices.

But the most interesting study on borders we have come across so far looked at two communities in Niger and Nigeria. These are the Hausa, who straddle the border between the two countries, and the Zamra, who are found within Niger and so have an “internal” ethnic border with the Hausa.
The study found that the Niger-Nigeria national border did not have such a large impact on the price difference of millet and cowpeas between the two countries, compared to other borders in the region that do not share a common ethnic community on both sides.
Intriguingly, the researchers found that the price difference within Niger, between the Zamra and the Hausa, was much more pronounced than that between the Hausa living on both sides of the Niger-Nigeria international border.
At first, it seems that linguistic differences between the Zamra and Hausa would explain the internal (ethnic) barrier to trade in Niger, as none of the Hausa traders in the study could speak Zamra, and only 20% of Zamra traders could speak Hausa.
It’s the women
But then interviews showed that it takes a very low level of linguistic proficiency to sell millet and cowpeas; just a rudimentary knowledge of simple terms and numbers in either language is enough to close a sale.
So if language isn’t the problem, what explains the price gap? The answer is surprising – women.
The researchers found a stark difference in the gender composition between the Hausa and Zarma regions. At the Hausa-Zamra “internal” border, 30% of traders operating in the Zamra markets are female, as compared with only 5% in the Hausa markets.
The percentage of female traders increases when moving farther west into Zarma regions, and decreases when moving farther east into Hausa.
The cultural difference in gender roles, as reflected by the gender composition of Zarma and Hausa markets, may be one source of the ethnic border effect if male Hausa traders are unwilling to trade with female Zamra traders.
This reluctance to trade with women reduces the optimal quantity traded between those markets – effectively segmenting the markets and creating a “real”, de facto border.
The study thus makes a stunning conclusion: that in such situations, ethnic borders may map the geography of trade more effectively than international borders do.
So if you’re a government, how do you promote trade in such an environment? Fancy customs offices and computerised border posts won’t make much of a difference. It’s easy – encourage intermarriage across communities. Market inefficiencies like this will disappear, because you’ll quickly run out of excuses why you can’t buy cowpeas from your wife’s sister.
Source: Source: Mail & Guardian


TERROR-FINANCE HUNT IMPERILS U.S. MONEY FLOWS TO WORLD’S POOREST



By Jeanna Smialek

For almost two decades, Hersi Suleiman’s relatives in Somalia have used the $100 to $500 he usually sends them each month for food, shelter and other basic needs.
Now, he’s worried that their lifeline will be cut as banks close accounts of money-transfer companies for fear of running afoul of U.S. regulations intended to staunch illegal flows of money to criminals and terrorists.
“If I did not send the money at the end of this month, it would be a huge, huge problem,” said Suleiman, 55, who lives in a Chicago suburb. For his brothers, sisters, nieces and nephews in an east African nation torn by civil war, “it’s a matter of life and death.”
Concerned that money-laundering regulations are unintentionally having a chilling effect on banks, the U.S. Treasury Department is trying to convince them they can comply with the rules and still provide services to businesses that handle the transfers. Doing so could be crucial to maintaining an affordable flow of money to needy families in countries with few banking options.
“The challenge is finding a way to meet the demand and minimize the risk,” said Robert Rowe, vice president and associate chief counsel at the American Bankers Association, a Washington-based trade group that represents the nation’s $15 trillion banking industry.
Failure to strike a balance might have another unintended consequence: driving cash underground, further from regulatory oversight.

‘Black Market’

“Not sending money home is not an option,” said Timothy Ogden, managing director of the Financial Access Initiative, which is housed at the graduate school of public service at New YorkUniversity in New York City. “Those families are going to turn to black-market options.”
Money transfers to other countries haven’t been interrupted yet, Ogden said. Still, as fewer banks work with cash-sending companies, it could drive up the cost of sending money or even choke off transfers to some far-flung and conflict-stricken regions that have limited banking access.
Flows from migrant workers in developed countries to relatives back home, known as remittances, accounted for 21.1 percent of the gross domestic product of Haiti in 2013, 24.9 percent in Moldova and 28.8 percent in Nepal, according to World Bank data.
Worldwide, such flows are projected to climb to $454 billion in 2015 from $435 billion last year, making them more than three times the size of all official development assistance to impoverished countries, based on World Bank research.
The U.S. is the largest sender, with $52 billion in outflows in 2013, the highest since 2008.

Treasury’s Reaction

That makes anything which threatens U.S. remittances a humanitarian concern. According to a notice released by the Treasury’s Financial Crimes Enforcement Network in November, banks may be “indiscriminately terminating” accounts of all money services businesses in order to avoid regulatory scrutiny.
The services issue, sell or redeem money orders or traveler’s checks, cash checks and transmit money, among other functions. Banks see them as particularly risky to work with, because it can be difficult to determine where money comes from and where it’s headed.
Prominent fines, including a $1.9 billion money-laundering charge against HSBC Holdings Plc in 2012 and a $1.7 billion settlement in 2014 for JPMorgan Chase & Co. related to money-laundering controls, have reinforced the perception of danger.

‘Shrinking Number’

“Just the fact that we’re dealing with remittances — that’s what we’re judged by,” said Aden Hassan, compliance manager at Kaah Express in Minneapolis, whose company sends money to countries including Somalia, Kenya and Ethiopia. “All of these companies are having to rely more and more on a shrinking number of banks that will do business with them.”
Money services such as Kaah Express need banks to deposit funds they receive and to wire the money, Hassan said. Because the smaller companies are the only ones that send remittances to places such as rural Kenya and Somalia, shutting down their U.S. bank access could leave swaths of the region without money transfers from the world’s largest economy, he said.
Last year, the bank that handles the wiring of almost all Somalian flows informed some remittance companies that they could lose their accounts, Hassan said.
The company, Merchants Bank of California NA, has kept the accounts open for now, he said, though it hasn’t indicated its future plans. The Carson, California-based bank didn’t respond to an e-mail and a voicemail requests for comment.

Roundtable Talks

The Treasury is taking note of banks’ reluctance. This week it hosted a roundtable to swap perspectives with the industry.
Remittances pose “real money-laundering and terrorist-financing risk,” David Cohen, undersecretary for terrorism and financial intelligence, said at the Jan. 13 meeting. “But we believe emphatically that risks such as these can and should be managed, not simply avoided altogether.”
Treasury officials “take very seriously concerns that banks have been indiscriminately” terminating or refusing the accounts of all money-service businesses, he said.
The department is reaching out to money transmitters to explain the rules so that they don’t have an unnecessary chilling effect. It has told banks that it’s possible to comply with the Bank Secrecy Act, which requires financial institutions to assist the government in detecting money laundering, while providing money-transfer services, Daniel Glaser, the Treasury’s assistant secretary for terrorist financing, said in an October blog post.
Who’s Responsible?
Finding the balance could prove challenging. Banks remain unsure whether they’re responsible for knowing their customers’ customer and ensuring that the money stays in safe hands, said Rowe from the American Bankers Association.
In 2013, London-based Barclays Plc was involved in a U.K. legal case after it said it would end its business with a Somali company that provided remittance services. A court found that the bank must maintain its relationship with the company while money-laundering concerns were reviewed.
For Suleiman, who moved from Somalia 33 years ago and has spent years working in banking — including 3 1/2 at the money-transfer business Amal USA Inc. — more certainty about the process can’t come soon enough. He’s become a spokesman on the issue, even testifying before Congress in 2012.
“I’m worried about it right now: They might shut it down entirely,” he said of the money channel to Somalia.
Source: Bloomberg