Home > Human rights, Land, mining > Who is writing Bougainville’s new mining policy and law? Some background on Adam Smith International

Who is writing Bougainville’s new mining policy and law? Some background on Adam Smith International

September 12, 2014 Leave a comment Go to comments

It has recently been publicised that Adam Smith International is the organisation who will assist the Bougainville government to draft a permanent mining law and policy. This law and policy will have far reaching impacts on future generations, so it is important they reflect the wishes and interests of all Bougainvilleans, but especially landowners. Adam Smith International sadly does not have a history of working with communities or defending their interests.

Here are some key facts about Adam Smith International:

1) ‘Far Right Wing lobby group’

Adam Smith International was set up by staff from the British based Adam Smith Institute, an organisation that is described by the respected UK journalist, George Monbiot, as a ‘far right-wing lobby group’; which means they support a world where big-business can own and exploit all key resources, such as land, minerals, oil, and water, in addition to using labour cheaply, without protecting workers rights. The Adam Smith Institute in particular champions policies that minimise or remove taxes and regulations for corporations/big companies (like environmental/labour protections). Corporations (big companies) are also among their primary donors.

2) Community ownership

Both the institute, and Adam Smith International, do not believe in the common or community ownership of property, and strongly advocate for the privatisation (private company ownership) of resources, including land and water.

3) Pushing privatisation on ‘unwilling populations’

In a statement to the UK Parliamentary Select Committee on International Development the respected NGO, World Development Movement, which campaigns against economic injustice, claimed Adam Smith International makes money from aid by pushing privatisation on unwilling populations. That is, they push for changes in property systems so big companies can buy up land, minerals, water and other communal or publicly owned resources. The NGO observes:

‘The consultancy firm Adam Smith International (ASI) received £270,000 of UK aid money in 1999 to produce a PR campaign in Tanzania involving the use of a national comedian in a series of TV adverts as well as a pop video—all promoting the country’s privatisation programme. The pop video had the following lyrics: “Young plants need rain, businesses need investment. Our old industries are like dry crops and privatisation brings the rain. When the harvest comes, there is plenty for everyone.”

More generally, ASI notes that it has the ability to “help muster the critical political support necessary to carry policies through to their successful conclusion”. It has built up a reputation as the consultant that “sells” privatisation to an unwilling population. In Ghana, DfID funded a “public awareness raising programme” about the benefits of privatisation. In India ASI was given aid money to produce a film about the benefits of privatisation’.

4) Mass suicide

In India, Adam Smith International were paid £1.65m by the British government to support local government policies that convinced local farmers to shift from subsistence gardens to cash crops. Many fell into debt they could not pay, which led to mass-suicides. According to The Independent ‘thousands of peasant farmers who were forced to approach unscrupulous money lenders to fund fertilisers, pesticides and water boreholes that produce little or no financial return. Among the methods of suicide chosen by victims has been to drink the pesticide they hoped would transform their economic prospects’.

5) Boomerang aid

Adam Smith International has made large amounts of money in Britain from aid work (sometimes known as boomerang aid). According to Britain’s Foreign Minister the company was awarded the following amounts between 2008-2013: 2008-9: £42,266,339 (K170 million); 2009-10: £13,785,832 (K60 million); 2010-11: £33,273,602 (K133 million); 2011-12: £66,409,259 (K260 million); 2012-13: £16,356,209 (K65 million).

6) Large fees and salaries

According to Britain’s Public Accounts committee, a parliamentary committee responsible for making sure public money is not wasted, Adam Smith International award its executives and directors large fees and salaries. The committee observed:

‘Our attention has been drawn to Adam Smith International, which received £37 million (K150 million) from the Department [of International Development] in 2010-11. One of Adam Smith International’s Directors received remuneration of over £250,000 (K1 million) in 2011. A Director also received a dividend in 2010 of over a million pounds. Such excessive payments undermine public confidence that the Department’s aid money is being spent well. We were told that the Secretary of State has committed to holding discussions with those involved in delivering its international aid, including Adam Smith International, to emphasise the need to ensure value for money for the taxpayer’.

The Chair of the Public Accounts Committee added:

this ‘feels like an absolutely outrageous and appalling waste of this very precious money that you have secured to invest in developing countries and it is really depressing to read about’.

7) ASI in Bougainville

Adam Smith International have been contracted by the Autonomous Bougainville Government to design Bougainville’s mining policy and help draft the final mining legislation.

8) Errors in Bougainville reporting

Adam Smith International reporting on Bougainville features serious errors. They refer to the conflict as ‘social unrest’. In some reporting they claim the war lasted for several years, in other they suggest it went from 1990-2000.

9) Professor Otto and the World Bank

A leading expert taking charge of the ASI project is Professor Otto, who has done contracted work for the World Bank and the International Monetary Fund, organisations that share Adam Smith Institute’s ideology (all resources should be privately owned and controlled by large companies). He was also the Rio Tinto Senior Lecturer at the University of Dundee, and a Director at Battlefield Minerals.


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