Title

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Canada Considers Next Steps in Extractive Industry Transparency; Roundtable in Toronto is Forum for Discussion on Harmonization of Canadian and U.S. Reporting Requirements
Friday, February 04, 2011

By Shelly Han
Policy Advisor

The oil, gas and mining sector play an important part of Canada’s economy, not only in terms of its domestic industry, but also the global reach of Canada’s extractive companies and the importance of its capital markets for international mining companies. According to recent reports, Toronto is the mining finance capital of the world, raising 30 to 40 per cent of the world’s mining equity almost every year, and Canadian mining companies account for a world-leading 40 percent of global exploration expenditure.

With passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010, a new law was created that requires greater transparency by oil, gas and mining companies in all markets, both domestic and international. The law, sponsored by Senators Ben Cardin and Richard Lugar, requires all companies listed on U.S. stock exchanges to report to the Securities and Exchange Commission (SEC) the payments they make to U.S. and foreign governments for natural resource exploration and extraction. The SEC rule to implement this law is currently being drafted and will become final in early April of 2011.

In order to make this transparency initiative even more effective, supporters of the measure are working to enact similar initiatives in other major capital markets such as the EU, Canada, Hong Kong and elsewhere. On January 18, 2011, the Publish What You Pay Coalition of Canada convened a roundtable discussion to consider ways that Canada might harmonize its exchange reporting regulations with the new requirements enacted in the United States. At the event were key players in the Canadian extractives industry sector, the regulatory agencies, academics and non-governmental organizations. Strong support was expressed by some participants for harmonization with the U.S. because of Canada’s pivotal role in providing mining capital. And even though Canadian companies and the Canadian Government have made a tremendous push toward increasing corporate social responsibility in the mining sector, it was noted by one of the participants that Canada is about to be severely criticized by the Organization for Economic Cooperation and Development (OECD) following completion of an assessment of their enforcement of anti-bribery laws.

During the discussion, the participants noted that a complicating factor in harmonization was the fact that Canadian capital markets are administered at the provincial and territory-level, meaning that unlike the practice in the United States where this is just one federal regulator, Canada has 13 separate securities regulators. Currently pending legislation in the form of a draft Securities Act, however, may create an overarching federal securities body, but some participants expressed doubt about the passage of this bill. Even absent creation of a federal agency, some participants noted that if the major exchanges in Toronto and Ontario moved to harmonize first, then other provinces were likely to follow suit.

Regardless, Canadian regulators are unlikely to move forward until a final SEC rule is issued in April. At that time groups such as the Publish What You Pay Coalition and others will likely move forward with a renewed push for harmonization with new global standard on transparency for the extractive industries.

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In addition to our work through the OECD, the United States has been working diligently to persuade the G20 countries to adopt a comprehensive anti-corruption action plan, which includes a commitment focused on adoption and robust enforcement of anti-bribery laws, implementation of the UN Convention Against Corruption, greater engagement with the private sector, and support for transparency mechanisms, to name a few. Many of these commitments require our G20 partners to enact and implement new laws and preventive measures. The United States, at ITA’s initiative, in particular, took the lead on proposals relating to the private sector and also on whistleblower protection, within the G20. In the United States, whistleblowers play a crucial role in helping to enforce anti-corruption law. This principle is also embodied in international conventions. Articles 12 and 13 of the UN Convention require States Parties to prevent corruption in the private sector and promote the fight against corruption with the business community and civil society. Unless governments can protect whistleblowers, it is unlikely that they can identify or address systemic causes of corruption. The United States believes robust whistleblower protection should be an essential part of any good governance initiative in the OSCE, and I was encouraged to hear Ambassador O’Leary indicate that this will be an area of focus under the Irish Chairmanship. The U.S. Department of Commerce has also been committed to fostering strong private sector integrity as an integral part of promoting good governance in markets worldwide. Companies are global corporate citizens, and as such, can work collectively and with governments to foster trust, and promote transparency. I hope that some our work may provide a useful model for the OSCE to consider as it looks to embrace good governance and anti-corruption as a priority for the second dimension, a goal we fully support, and which I am personally committed to supporting. For example, the ITA has championed business ethics and corporate governance reform since the early 1990s, following the fall of the Berlin Wall. Our Business Ethics Manual has been translated into Chinese, Spanish and Russian and is still one of the most widely used resources on this important topic. We have partnered with business associations and chambers of commerce to develop collective action and business ethics program in many markets. Our work on business ethics has grown. This past year, the ITA has focused on trying to heighten awareness of good governance, transparency and business ethics in sectors of vital importance to many economies – by taking a “sectoral” approach to combating corruption and promoting good business practice, the challenge of dealing with corruption becomes less daunting. The ethical issues specific to different industries vary greatly – and there is no one-size-fits-all approach to the problem. Within the G20, for example, the United States, at the initiative of the U.S. Department of Commerce, has taken the lead in calling for the G20 to endorse additional sectoral approaches to fighting corruption, beyond the Extractive Industries Transparency Initiative (EITI). We have asked G20 governments, for example, to consider supporting the Construction Sector Transparency Initiative (COST) – a new multistakeholder initiative, developed by the World Bank. COST uses similar approaches to EITI to promote greater transparency in public infrastructure projects and government procurement. I hope that the OSCE might similarly consider COST and other multistakeholder approaches to promoting transparency under the Irish chairmanship. Within APEC, the ITA has focused on developing new ethical principles for key sectors within the APEC region. I am pleased to report that under the APEC SME working group, we have coordinated a project with APEC countries and businesses to develop principles of business ethics in the construction, medical devices and biopharmaceutical sectors. These voluntary principles are meant to be used by businesses and trade associations – large andwithin the OSCE framework and the EEDIM, we might also consider focusing on business ethics in specific sectors of interest to all of our economies. I want to close by suggesting some activities to take the theme of good governance and transparency forward. In addition to encouraging the OSCE to formally endorse the Extractive Industries Transparency Initiative—a move that would send an important signal about this body’s commitment to the principles of good governance and transparency—the U.S. encourages us to explore whether there are additional sectoral initiatives that merit support from the OSCE, including the Construction Sector Transparency Initiative. The United States Government also strongly supports the Irish Chair’s goal to develop a Statement or Declaration of Transparency Principles to help guide our governments in their future activities. I want to encourage us to consider new models of bilateral cooperation to promote good governance such as the model Mr. Murray just discussed, leading to a public-private initiative in the Russian power generation sector. We at the U.S. Department of Commerce are working closely with the Center for Black Sea/Caspian Studies at American University to potentially convene a conference in May of next year that would seek to address the challenge of developing mechanisms to ensure good governance and transparency, while also balancing the goals of protecting national security and accelerating economic development faced by the countries of the Caucasus and Central Asia, as they seek to assert their role as a gateway between Europe and Asia. In addition, the conference will also focus on specific market access challenges to regional integration and economic development in the Caucasus and Central Asia such as transparency in Government procurement and privatization, and trade facilitation challenges, including customs and lack of regional harmonization. It is our hope that the OSCE will join us for this event – focused on critical areas such as transport and infrastructure – to work on tangible ideas for projects and collaborations in the OSCE region. We look forward with great interest to the 20th Economic and Environmental Forum, where we will delve deeper into all the facets of good governance. We also thank the Lithuanian Chairman-in-Office for  ensuring that their draft Ministerial Council decision on Energy Security incorporates transparency in the energy sector – in our view, considering the vital role that energy plays in modern economic life, there can be no confidence, and thus no security, without energy transparency. In the year ahead, we envision an even broader focus on transparency principles across the entire spectrum of economic and environmental activities, and will work with all of our colleagues in the OSCE to make that vision a reality. Thank you, Mr. Moderator.  

  • Commissioner Camuñez's Remarks on Good Governance

    Economic and Environmental Dimension Implementation Meeting Session 3: Good Governance Before I begin, I’d like to thank the panelists today for their excellent and informative presentations. The United States has viewed with keen interest the evolving discussions in recent years on what the OSCE’s priorities should be in the Economic and Environmental Dimension.  As our friend and colleague Mr. Svilanovic pointed out during last year’s Vienna Review Conference, we appear to have come to an appreciation that good governance is the key linking theme across the entire second dimension.  The Maastricht Strategy is very clear on this point: “Good public and corporate governance and strong institutions are essential foundations for a sound economy, which can attract investments, and thereby enable States to reduce poverty and inequality, to increase social integration and opportunities for all, and to protect the environment.  Good governance at all levels contributes to prosperity, stability and security.”  As we consider the implementation of our second dimension commitments, however, we should keep in mind why it is important to implement those commitments. The global economic downturn continues to put extreme pressure on people and governments across the OSCE region.  To be sure, some countries have weathered the storm better than others.  Still, no country can be forever immune to market forces, and even within those that have done well, there are always citizens left behind.  This is certainly the case in the United States, and for this reason President Obama is focused intently on how best to put those Americans without a job back to work.  We all know that trade and investment are critical drivers of economic growth.  Indeed, recognizing this important reality, the Obama Administration has launched the National Export Initiative, which seeks to deepen our strategic trade relationships around the world, recognizing that 85 percent of world GDP growth will occur outside the United States in the coming few years.  As we encourage more American businesses – large and small – to embrace international trade, seek opportunities in new markets, and make strategic investments that will lead to increased global trade flows, we are keenly aware of the challenges and costs posed by official corruption, weak institutions, and lack of respect for property rights, including intellectual property. Weak governance and lack of transparency constitute non-tariff barriers to trade, which we have committed ourselves to eliminating.  Furthermore, the same issues that deter trade and investment also work against comprehensive security: a lack of transparency in governance leads to diminished confidence that problems and disputes will be addressed in a fair and impartial manner.  Without trust and confidence in public institutions, there is little incentive for investors and companies to pursue trade deals or direct investment in those economies.  The effect is stagnating economic performance, which, as we have seen in the past several months and years, can lead to political upheaval.    The United States Government is deeply committed to fostering good governance and transparency in its political and economic institutions.  President Obama has made the global fight against corruption a top priority.  As he has noted, “In too many places, the culture of the bribe is a brake on development and prosperity.  It discourages entrepreneurship, destroys public trust, and undermines the rule of law while stifling economic growth.”    The real world costs of corruption and weak institutions should not be underestimated.  The World Bank estimates that more than one trillion dollars in bribes are paid each year out of a global economy of approximately 30 trillion dollars.  That's an incredible three percent of the world’s economy.   In 2009, companies lost nearly $25 billion to companies willing to pay bribes in deals for which the outcome is known.  And bribery is especially costly for small and medium-size enterprises (SMEs): a separate study has shown that up to 25 percent of SME operating capital in companies operating internationally is diverted to corruption.  That is a staggering figure that illustrates how corruption diverts scarce resources to thoroughly unproductive ends. Corruption is a global problem that knows no borders.  And that’s why corruption demands a truly global response – one that knows no limits on collaboration.  The Obama Administration is doing its part to implement its obligations under the OECD Anti-Bribery Convention by enforcing the U.S. Foreign Corrupt Practices Act (FCPA) strictly and fairly.  We are determined to ensure that U.S. businesses do not contribute to corruption in foreign markets.  At the same time, we are determined to do what we can to assist them in the fight against foreign corruption, and against the high risk and significant costs of corruption in such markets.   Regrettably, at this stage, the lack of enforcement of domestic bribery laws, and of foreign bribery laws by many nations that are Parties to the OECD Anti-Bribery Convention is extremely troubling and raises concerns about a lack of political will.  Governments can and should prosecute both those who give bribes and those who receive them, both at home and abroad.  And the OSCE should continue to encourage participating States to adopt and enforce rigorous anti-bribery regimes. Of course, the fight against corruption is not simply a law enforcement matter; rather it can also be a significant – if not the most significant – non-tariff barrier all companies face.  Accordingly, the U.S. Department of Commerce and the International Trade Administration (or ITA) are committed to working with our trading partners to level the playing field and to promote transparent and corruption-free markets globally.  Our work to promote clean and ethical business environments occurs at both the multilateral and bilateral level.  At the multilateral level, the ITA is pressing its counterparts to lead by example and to implement comprehensive anti-corruption measures.   In addition to our work through the OECD, the United States has been working diligently to persuade the G20 countries to adopt a comprehensive anti-corruption action plan, which includes a commitment focused on adoption and robust enforcement of anti-bribery laws, implementation of the UN Convention Against Corruption, greater engagement with the private sector, and support for transparency mechanisms, to name a few.  Many of these commitments require our G20 partners to enact and implement new laws and preventive measures.   The United States, at ITA’s initiative, in particular, took the lead on proposals relating to the private sector and also on whistleblower protection, within the G20.  In the United States, whistleblowers play a crucial role in helping to enforce anti-corruption law.  This principle is also embodied in international conventions.  Articles 12 and 13 of the UN Convention require States Parties to prevent corruption in the private sector and promote the fight against corruption with the business community and civil society.  Unless governments can protect whistleblowers, it is unlikely that they can identify or address systemic causes of corruption.  The United States believes robust whistleblower protection should be an essential part of any good governance initiative in the OSCE, and I was encouraged to hear Ambassador O’Leary indicate that this will be an area of focus under the Irish Chairmanship.   The U.S. Department of Commerce has also been committed to fostering strong private sector integrity as an integral part of promoting good governance in markets worldwide.  Companies are global corporate citizens, and as such, can work collectively and with governments to foster trust, and promote transparency.  I hope that some our work may provide a useful model for the OSCE to consider as it looks to embrace good governance and anti-corruption as a priority for the second dimension, a goal we fully support, and which I am personally committed to supporting. For example, the ITA has championed business ethics and corporate governance reform since the early 1990s, following the fall of the Berlin Wall.  Our Business Ethics Manual has been translated into Chinese, Spanish and Russian and is still one of the most widely used resources on this important topic.  We have partnered with business associations and chambers of commerce to develop collective action and business ethics program in many markets.   Our work on business ethics has grown.  This past year, the ITA has focused on trying to heighten awareness of good governance, transparency and business ethics in sectors of vital importance to many economies – by taking a “sectoral” approach to combating corruption and promoting good business practice, the challenge of dealing with corruption becomes less daunting.  The ethical issues specific to different industries vary greatly – and there is no one-size-fits-all approach to the problem.  Within the G20, for example, the United States, at the initiative of the U.S. Department of Commerce, has taken the lead in calling for the G20 to endorse additional sectoral approaches to fighting corruption, beyond the Extractive Industries Transparency Initiative (EITI).  We have asked G20 governments, for example, to consider supporting the Construction Sector Transparency Initiative (COST) – a new multistakeholder initiative, developed by the World Bank.  COST uses similar approaches to EITI to promote greater transparency in public infrastructure projects and government procurement.  I hope that the OSCE might similarly consider COST and other multistakeholder approaches to promoting transparency under the Irish chairmanship.     Within APEC, the ITA has focused on developing new ethical principles for key sectors within the APEC region.  I am pleased to report that under the APEC SME working group, we have coordinated a project with APEC countries and businesses to develop principles of business ethics in the construction, medical devices and biopharmaceutical sectors.  These voluntary principles are meant to be used by businesses and trade associations – large and small – to guide their ethical interactions with public officials and institutions.   I hope that within the OSCE framework and the EEDIM, we might also consider focusing on business ethics in specific sectors of interest to all of our economies.  I want to close by suggesting some activities to take the theme of good governance and transparency forward.  In addition to encouraging the OSCE to formally endorse the Extractive Industries Transparency Initiative—a move that would send an important signal about this body’s commitment to the principles of good governance and transparency—the U.S. encourages us to explore whether there are additional sectoral initiatives that merit support from the OSCE, including the Construction Sector Transparency Initiative.  The United States Government also strongly supports the Irish Chair’s goal to develop a Statement or Declaration of Transparency Principles to help guide our governments in their future activities. I want to encourage us to consider new models of bilateral cooperation to promote good governance such as the model Mr. Murray just discussed, leading to a public-private initiative in the Russian power generation sector.   We at the U.S. Department of Commerce are working closely with the Center for Black Sea/Caspian Studies at American University to potentially convene a conference in May of next year that would seek to address the challenge of developing mechanisms to ensure good governance and transparency, while also balancing the goals of protecting national security and accelerating economic development faced by the countries of the Caucasus and Central Asia, as they seek to assert their role as a gateway between Europe and Asia.  In addition, the conference will also focus on specific market access challenges to regional integration and economic development in the Caucasus and Central Asia such as transparency in Government procurement and privatization, and trade facilitation challenges, including customs and lack of regional harmonization.  It is our hope that the OSCE will join us for this event – focused on critical areas such as transport and infrastructure – to work on tangible ideas for projects and collaborations in the OSCE region. We look forward with great interest to the 20th Economic and Environmental Forum, where we will delve deeper into all the facets of good governance.  We also thank the Lithuanian Chairman-in-Office for ensuring that their draft Ministerial Council decision on Energy Security incorporates transparency in the energy sector – in our view, considering the vital role that energy plays in modern economic life, there can be no confidence, and thus no security, without energy transparency.  In the year ahead, we envision an even broader focus on transparency principles across the entire spectrum of economic and environmental activities, and will work with all of our colleagues in the OSCE to make that vision a reality. Thank you, Mr. Moderator.

  • Commissioner Camuñez's Opening Statement at the Economic and Environmental Dimension Implementation Meeting

    Economic and Environmental Dimension Implementation Meeting Opening Remarks On behalf of the United States, I would like to thank the Lithuanian Chairman-in-Office, Secretary General Zannier, Coordinator for Economic and Environmental Activities Svilanović, and of course our Austrian hosts for convening this inaugural Economic and Environmental Dimension Implementation Meeting and for providing a warm welcome to Vienna. It is an honor to be here today as head of the U.S. delegation to the OSCE, representing the U.S. Government in my capacity as an Assistant Secretary of Commerce for Market Access and Compliance (MAC) within the International Trade Administration, and as a Commissioner to the U.S. Helsinki Commission. As a Commerce Department Assistant Secretary for Market Access and Compliance, I am responsible for helping lead the effort to open new markets for U.S. companies, identifying and eliminating market access challenges such as non-tariff barriers to trade, and helping to monitor and enforce U.S. trade agreements and commitments. The work of the Environmental and Economic Dimension, especially that which focuses on transparency of markets and good governance, is closely aligned with the work we undertake in the International Trade Administration. I am here today to deliver the message that the U.S. Government is highly committed to making the second dimension even more effective and dynamic, and that we will do our part in ensuring that our economic and environmental commitments receive the same level of attention and scrutiny that those in the political-military and human dimensions currently enjoy. I will try to keep my remarks brief, but I think it is critical that we take a close look at the economic and environmental commitments as they were spelled out in the 2003 Maastricht Strategy. We still see Maastricht as the key blueprint for moving forward on all the  commitments that have come before, and in particular, note a number of areas where we could pursue significant, substantive action over the next few years to achieve measurable progress. Our commitments on economic cooperation have at their core the idea of connectedness to regional and global markets, to trade and investment networks, and to energy and transportation infrastructure, as a way to address emerging economic challenges and threats. In light of the global economic downturn, it is vital that we recommit ourselves to increasing cooperation through a variety of measures, including improving corporate governance and public management, eliminating unnecessary and discriminatory barriers to trade, continuing  to harmonize our regulations and standards where appropriate, taking further steps to combat financial crimes like bribery and money laundering, and increasing confidence through the incorporation of transparency principles in all of our public and private ventures. At the same time, in view of our progress made this year worldwide on  empowering women in the economy, first at the Invest for the Future Conference in Istanbul in January and most recently at the APEC Summit in San Francisco, we believe it is important to recognize the critical connection between women and strong economies, and to remove all barriers that prevent women from full and equal participation in the economy. I would like to focus my comments this morning on the subject of good governance, however. We have committed ourselves time and again to “good governance,” and while progress has been made, much work remains to be done. As stated in the 2003 Maastricht Strategy, achieving good governance will require a comprehensive, long-term strategic approach. In the view of the U.S. Government, good governance is the core theme within the economic and environmental dimension, and we are pleased that next year’s Forum will address the topic in a broad and detailed way. When we speak of good governance, we speak about governments having both the propensity and the competence to manage complex political and economic systems in a fair, fully inclusive, and transparent way. Anti-corruption is part of it, but not the whole picture. It’s about having transparent, clear and predictable legislative and regulatory frameworks that foster efficient and low-cost business formation and development, and most importantly allow and even encourage robust participation in the political and economic spheres by civil society. Let me say a few words about my agency’s past and current work in this area, reserving greater details and the highlights of a new proposal for Session III tomorrow. From 1998-2008, the U.S. Department of Commerce launched a Good Governance Program, focused on partnering with the public and private sectors in the countries of the former Soviet Union and Central-Eastern Europe. This work, focused on promoting sound corporate governance and business ethics, culminated in the publication of a Business Ethics Manual, a Commercial Dispute Resolution Handbook, and a Corporate Governance Manual translated into several languages and disseminated widely throughout the OSCE region. Today, we continue to work on numerous initiatives around the world, within multilateral fora such as APEC and the G20, which involve OSCE members, promoting consensus based principles focused on anticorruption. We have taken our business ethics work and branched out into new regions including Asia and Latin America. Despite a clear understanding of its importance, the lack of good governance and systemic corruption remain some of the single most important market access challenges for companies engaged in trade around the world. This is especially true for small and medium sized enterprises, which are the engine of economic growth and innovation throughout the world. The United States believes that addressing these issues can only lead to greater investment, economic prosperity and security. Over the next three days, we will discuss OSCE support for the Extractive Industries Transparency Initiative (EITI). I am pleased to report that the U.S. Department of Commerce played an important role in supporting the creation of the EITI in its initial phase. The OSCE now has a chance to follow in the steps of the G8 and G20, by endorsing the EITI, and I applaud the governments that have preceded the United States as implementers. The EITI is a great example of how shared commitments towards good governance and transparency in a vital sector to many countries can work and build sustained momentum and engagement between the private sector, governments and civil society. Tomorrow I will share more concrete information about the work that the U.S. Government and my Department have undertaken to promote good governance and to combat corruption. I am pleased to have an expert on business ethics and anti-corruption in the energy sector, as part of the U.S. delegation. Mr. Matthew Murray runs the Center for Business Ethics and Corporate Governance in St. Petersburg, Russia, and he’ll speak to you later about a good governance initiative involving public and private stakeholders in the power generation sector in Russia, which may serve as a model for similar programs in other OSCE countries. I am also pleased to have Kate Watters of Crude Accountability joining the U.S. delegation, who will provide some examples of how transparency is a critical component of enhancing security in the environmental sphere. A month ago, the Economic and Environmental Forum discussed the concept of sustainability and where efforts to promote sustainable practices stand in our region. Those discussions remind us that our commitments on sustainable development encompass a broad spectrum of activities related to efficiency, sound resource management, and the full involvement of all stakeholders in decision-making. Just to cite an example from the Prague Forum, we recognize that in order to further develop economies and markets in such varied areas as the Black Sea region and Central Asia we will need to address several problems: improving the efficiency of border crossings and building construction, tilting the energy mix towards cleaner fuels, harmonizing standards and practices across the region, and, just as critically, ensuring broad involvement of civil society in the decision-making on project proposal, design, and implementation. One thing that sets the OSCE apart from many other organizations addressing the environment is recognition of the clear connection between the environment and security. We recognize that many environmental disasters cannot be predicted or prevented. At the same time, greater transparency – through information sharing and civil society engagement – about possible security risks stemming from the environment will make it possible to prevent or mitigate more disasters, both natural and man-made. We also must recognize that failure to protect the environment is itself a security risk, putting increased pressure on populations facing dwindling resources of clean air and water, arable farmland, and adequate energy. Colleagues, The next three days provide a critical juncture and platform for finding consensus on measures that will improve our implementation of the OSCE commitments in the economic and environmental dimension. The Vilnius Ministerial is only a month and a half away; now is the time to summon the political will to find a way forward. We look forward to building consensus on decisions on energy security, to include good governance and transparency, and we welcome constructive dialogue on additional measures proposed on confidence-building initiatives and sustainable transport. We view these elements, along with sustainable development and protecting the environment, as the cornerstones of the Maastricht Strategy, and will be speaking about these over the next several days. Just a month ago, we found some convergence of opinion on discrete aspects of the second dimension. Let us expand that convergence to the entire dimension as we review our economic and environmental commitments over the next few days, with a view toward substantive deliverables for Vilnius. Thank you, Mr. Moderator.

  • U.S.-Russian Cooperation in the Fight Against Alcoholism: A Glass Half Full?

    Following a hearing on demographic trends in the OSCE region, which feature Russia as a case study, this briefing was held as a venue for discussing prospects for sharing experience, strength, and hope on treating the disease of alcoholism. Divergent approaches to treating a problem that vexes American and Russian society and is a significant factor in the alarmingly low life expectancy of Russian men were presented. Panelists speaking at this briefing discussed the institutions in place in Russia to treat alcoholism, including the Leningrad Oblast, and the need for more of these institutions to be implemented. Historical aspects of this issue were identified as a serious obstacle in presenting a solution to the problem of alcoholism in Russia.

  • 2050: Implications of Demographic Trends in the OSCE Region

    The hearing focused on the implications of current demographic trends in the expansive OSCE region through the prism of the security, economic and human dimensions.  Most of the OSCE’s 56 participating states are experiencing varying stages of demographic decline, marked by diminishing and rapidly aging populations. Such patterns were identifying as likely to have significant social, economic and security consequences for countries throughout the region, including the United States. Witnesses testifying at this hearing – including Jack A. Goldstone, Director of the Center for Global Policy at George Mason University; Nicholas Eberstadt, Henry Wendt Scholar in Political Economy of the American Enterprise Institute; Richard Jackson, Director and Senior Fellow of the Global Aging Initiative at the Center for Strategic and International Studies; and Steven W. Mosher, President of the Population Research Institute – addressed issues related to the demographic trends in the OSCE region, such as shrinking workforces in a growing number of participating States that are expected to become increasingly dependent upon foreign workers in the coming decades. A concern that these factors could contribute to mounting social tensions as demonstrated by clashes in some participating States in recent years was evident.

  • Labor Trafficking In Troubled Economic Times: Protecting American Jobs And Migrant Human Rights

    This hearing brought attention to the extremely lucrative criminal enterprise of human trafficking. Specific attention was focused on those who were most likely to be victims (i.e. people who were poor, had lost their jobs). Therefore, human trafficking, which involves forced labor, profits more in times of economic decline.

  • OSCE 2010 Informal Ministerial: Kazakhstan Persistence Earns a Summit in Astana

    By Winsome Packer Policy Advisor Kazakhstan hosted its long-sought OSCE Informal Ministerial in Almaty July 16-17, 2010, the realization of a key aim of its Chairmanship. A second important objective of the Kazakh Chairmanship: a summit on Kazakh soil during 2010, came closer to realization during the meeting. An Astana Summit would be the OSCE’s first since the 1999 Istanbul Summit, which yielded the Adapted Conventional Armed Forces Treaty. Early and persistent calls for “substance before summit” by the U.S. Delegation and other participating States had put in doubt both the informal ministerial and the summit for months. However, a number of the participating States argued for the high level attention to wide-spread security challenges in the OSCE region and the erosion of OSCE values in some quarters. Ten years after the last OSCE summit, they argued, necessitated a meeting of heads of states and governments to reaffirm the participating States’ commitment to the organization’s values and agree on a way forward to tackle the challenges confronting the region today. Thus, six months of, at times, heated informal Corfu dialogue on security challenges in the OSCE region, which was mandated by the Athens Ministerial Declaration, yielded more than 50 “food for thought” papers from the participating States, the Parliamentary Assembly, the OSCE Secretariat, the Partners for Cooperation, think tanks and non-governmental organizations. The thematic papers evolved into an Interim Report during June, which incorporated the proposals submitted within the Corfu Process. It formed the basis for the agenda at the Almaty Informal Ministerial and for the Summit which will be held in Astana December 1-2, 2010. The Almaty Informal Ministerial saw the participation of more than forty foreign ministers, including from the Russian Federation, France, Germany, Canada, Spain, Portugal, Poland, Georgia, Turkey, Austria, and Ukraine. The Parliamentary Assembly’s delegation included President Petros Efthymiou, and Secretary General Spencer Oliver. The U.S. delegation was headed by Deputy Secretary of State James Steinberg who, in a bilateral meeting with the Kazakhstanis on July 16, affirmed U.S. support for an OSCE summit this year. The joining of consensus on the summit decision by the United States elicited private expressions of relief from many delegates, and heightened expectations for the summit which would reflect the outcome of the Corfu Process: a declaration and an action plan. The Chair-in-Office requested that the OSCE delegations work toward these aims throughout the summer. During the meeting, delegates voiced support for the summit, to be held in Astana. A majority of the participating States urged OSCE support for Kyrgyzstan, in particular, through the deployment of a police mission. The United States and many delegates stated that the substance of the summit should be based upon the four proposals put forward by the European Union to: (1) bolster the OSCE’s capabilities in all three dimensions to promote early warning, conflict prevention and resolution, crisis management and post-conflict rehabilitation, including in relation to the protracted conflicts; (2) strengthen implementation and follow-up of OSCE norms, principles and commitments in particular, human dimension commitments covering human rights and fundamental freedoms, including freedom of the media; (3) enhance the conventional arms control framework, including confidence and security building measures, through updating the 1999 Vienna Document and the Conventional Forces in Europe Treaty); and (4) increase attention to transnational threats in all three OSCE dimensions. Some delegates also called for a summit to: focus on instability in Afghanistan; intensify efforts to resolve protracted conflicts in the region, and address nuclear terrorism and the proliferation of nuclear and weapons of mass destruction. The United States called for greater military transparency, implementation of human dimension commitments and addressing inter-ethnic conflict in Kyrgyzstan. The U.S. delegation also expressed support for the expeditous deployment of a police force to Kyrgyzstan and for an action plan for the future work of the participating States. In addition to supporting the European Union’s four summit process proposals, the United States also expressed support for a focus on Afghanistan. A Chair’s Perception Paper, resulting from the informal ministerial, incorporated these concerns. Russian Foreign Minister Sergei Lavrov reiterated Russia’s support for the summit “this year.” He urged the involvement of other regional and sub-regional leaders in addressing the Kyrgyzstan situation. He expressed hope that action would be taken on Russia’s proposal for a European Security Treaty (EST) and that it would not merely remain a “subject for discussion.” Lavrov said that the summit document should reflect the post Cold War situation and the security system that emerges should be “free of dividing lines.” He said that Russia was studying NATO’s response to the EST proposal and underlined that the summit should give strong, political impetus for supporting Kyrgyzstan. Concurrent with the Informal Ministerial, draft decisions on the holding of an OSCE summit during 2010 and draft decisions on the agenda and modalities of the summit and agenda and modalities for a review conference were circulated. The review conference would be held in Vienna, Warsaw, and Astana. Negotiations on the draft decisions began on July 19.

  • Russia: U.S. Congressmen Propose Sanctions in Lawyer’s Death

    Members of the United States Congress introduced legislation on Wednesday that would impose financial sanctions and visa bans on Russian officials implicated in the case of Sergei L. Magnitsky, a Russian lawyer who died in prison in Moscow in November after being ensnared in tax inquiry. The measure’s sponsors — including Senator Benjamin L. Cardin, a Maryland Democrat, and Representative Jim McGovern, a Massachusetts Democrat — said it was intended to spur the Russian government to properly investigate Mr. Magnitsky’s death. His defenders contend that he was jailed in an effort to force him to falsify testimony against Hermitage Capital Management, a major foreign investment fund that once had large holdings in Russia. His death caused widespread outrage and focused renewed attention on police tactics and corruption in Russia.

  • Opening a Second Front

    The death in prison of Sergei Magnitsky, a young Russian lawyer, remains one of the darkest scandals in the blotchy history of Russia's criminal justice system, exemplifying a culture of impunity in which power and wealth are fungible, and those who get in the way get squashed. Mr Magnitsky died of untreated pancreatis in pre-trial detention. He hadaccused Russian officials of stealing millions of tax dollars paid by his client, Hermitage Capital Management. Energetic lobbying by the head of Hermitage, the American-born financier Bill Browder, now seems to be getting somewhere. Two senior American lawmakers, Senator Benjamin L. Cardin (a Democrat from Maryland), who is Chairman of the congressional Helsinki Commission and James P. McGovern (a Democratic congressman from Massachussetts), who chairs the Tom Lantos Human Rights Commission, have introduced laws that would prohibit some 60-odd Russian officials linked to his death from visiting the United States, and freeze any assets they hold under American jurisdiction. (The Russian officials concerned have either made no public comment, or deny all wrongdoing). Mr Cardin said: “Nearly a year after Sergei’s death, the leading figures in this scheme remain in power in Russia. It has become clear that if we expect any measure of justice in this case, we must act in the United States...At the least we can and should block these corrupt individuals from traveling and investing their ill-gotten money in our country.” Mr McGovern said: “I have introduced the ‘Justice for Sergei Magnitsky Act of 2010’ in the House of Representatives as a direct consequence of the compelling testimony at a hearing on human rights in the Russian Federation in the Tom Lantos Human Rights Commission. The death of this courageous whistleblower in a Russian prison is the consequence of an abysmal prison system and corruption aimed at defrauding the Russian Treasury of billions. We know about Sergei Magnitsky, and we know about Mikhail Khodorkovsky, but how many more Magnitskys and Khodorkovskys are currently suffering in Russian prisons? My bill addresses the root causes of these severe human rights violations -- the Russian prison system and official corruption. We should not rest until justice is achieved in Sergei’s case, and the money is returned to its rightful owners -- the people of the Russian Federation."

  • U.S. Lawmakers Push Visa Sanctions in Russian Case

    More than 60 Russians linked to the death of an anti-corruption lawyer would be barred from the United States and its financial markets under a bill introduced in the Congress on Wednesday. The measure says that sanctions would be lifted only after Russia brings to justice those responsible for the 2009 death of Sergei Magnitsky, a lawyer for what was once Russia's top equity fund, Hermitage. But the bill, introduced by Senator Benjamin Cardin and Representative James McGovern, both Democrats, faces a steep climb to get passed before Congress completes its work for the year. Human rights activists charge that Russian authorities subjected Magnitsky to conditions amounting to torture in a failed bid to force him to testify in their favor in a battle with Hermitage over a $234 million tax fraud scheme. Magnitsky died after being repeatedly denied medical treatment in pre-trial detention. He had accused Russian officials of stealing the millions of tax dollars paid by his client. A Democratic aide said the bill has drawn bipartisan interest and lawmakers might get to it when they return to Washington after the November 2 congressional election for what is expected to be a final few weeks of work. "Nearly a year after Sergei's death, the leading figures in this scheme remain in power in Russia," said Cardin, who also chairs the human rights monitoring U.S. Helsinki Commission, an independent federal agency. "If we expect any measure of justice in this case, we must act in the United States," said Cardin. "At the least, we can and should block these corrupt individuals from traveling and investing their ill-gotten money in our country."

  • Minority Political Participation in the Obama Era

    Representative Michael Honda introduced the briefing on behalf of Congressman Alcee L. Hastings, who called on strengthening work across borders to stem the growing tide of intolerance and to realize that there is much more to gain by involving minority communities in the political process than alienating them. He was joined by Congresswoman Barbara Lee, Chair of the Congressional Black Caucus, who emphasized strengthening partnerships with minority counterparts in Europe and abroad. Gay McDougall brought her expertise to the discussion and emphasized the toxic role of the media with respect to the participation of minority politicians.  

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