Daily Sun
Anniversary issue
October, 22, 2012
M.
Serajul Islam
A
major thrust of the AL Government in foreign policy in its last term in office
(1996-2001) was emphasizing upon the importance of economic diplomacy. In fact,
economic diplomacy was the cornerstone of the Government’s foreign policy goals
in that term. On her official visits to
China soon after assuming office in July, 1996 and to Japan a year after,
economic diplomacy was the key element of Prime Minister Sheikh Hasina’s
foreign policy initiatives. Wherever she went abroad on that term, the Foreign
Ministry and its Embassies/High Commissions were mandatorily required to
arrange investment seminars, meeting business people and investors, etc, to
allow the Prime Minister to pursue economic diplomacy.
In
that term, the AL had come to power through a democratic election held under a
caretaker government that it had forced upon the BNP led government that
introduced the amendment to incorporate the Caretaker Government (CG) system in the constitution. It went before
the world to claim that the CG system was its contribution to democracy; to
help developing countries hold free and fair elections to reflect popular will
in the change of government. In that term, Sheikh Hasina went to the World
Summit on Micro-credit in Washington in 1997 holding the hands of Dr. Mohammad
Yunus claiming with him credit for establishing micro-credit on the world stage
that was then beginning to capture the imagination of the western world.
The
Prime Minister was also able to push Bangladesh-India relations ahead achieving
an agreement on the Ganges Water Sharing and the Chittagong Hill Tracts Accord
in that term. She was under no external
pressures. In the country she was in control of domestic politics except for
the usual pressure from the opposition.. Thus she was able to lead the
government with a sense of direction and purpose where pursuit of economic
diplomacy fitted into foreign policy and governance like the hand into the
glove.
In
her current term in office, the performance of her government in economic
diplomacy has become a victim of the government’s over-all failure in
governance. The mess made by the
government with the funding for the Padma Bridge is in everybody’s mind and the
major subject of discussion in the country at present. Its failure to deal with
the World Bank diplomatically on the latter’s concerns over allegations of
corruption led to Bank to postpone its loan of US$ 1.2 billion and later cancel
it altogether. With the World Bank actions, the two other co-financiers, the ADB
and JICA, also withheld their contributions for the US 2.7 billion project.
The
government went on media campaign against the WB after the cancellation instead
of negotiating with it to meet the latter’s concerns. The Prime Minister, her
ministers and party leaders accused the World Bank in undignified languages
that insulted an international financial institution that has so far
contributed over U$ 16 billion to Bangladesh’s development efforts and with
over US$ 4 billion in the pipeline without accounting for the amount for the
Padma Bridge, all at highly concessional rates. The Prime Minister promised to
build the PB from domestic resources to raise nationalistic passion against the
WB that led to frenzy for collecting money resulting in the death of a student
in Rajshahi. The Prime Minister was hailed for her courage and the WB projected
as a corrupt, oppressive financial institution by the government and AL
leaders.
In
the end, however, the government went back to the WB and submitted itself
totally to the conditions of the Bank to reactivate the loan, conditions that
are so humiliating that the Bank never dared to impose such conditions on any
other country before. The government sacked a Minister; sent an Adviser and a
Secretary on leave and cancelled the contractual appointment of another senior
bureaucrat to convince the Bank that it was ready to accept all its demands for
reactivating the loan. The Prime Minister’s Adviser Dr. Gowhar Rizvi was sent
to Washington to personally inform the WB that the Government was ready to
accept the three remaining demands that the Bank had made many months earlier
to provide the loan.
One
demand included the creation of an international panel of experts that will
decide on the “progress, adequacy and fairness” of the ACC’s investigations on
the Bank’s allegations of corruption. Under this demand, the Bank’s
representatives will be a part of the ACC’s investigation team and the ACC will
have no power to withhold anything. This demand has not just taken away the
ACC’s independence; it has taken away a little of the country’s sovereignty.
Another demand will put the Bank and its co-financiers in control of
procurement that has led some analysts to call the project as a turnkey one. The
Bank also mentioned categorically that the funds will be released only after
these conditions are fulfilled no doubt openly flagging its distrust of the
government.
The
government’s handling of the PB loan will stand out as an example of economic
diplomacy at its worst. It messed up negotiations by dismissing the Bank’s
allegations on corruption outright when made at first and going on the
offensive. Its cardinal error was to fight the Bank in the media instead of
negotiations; allowing party and government leaders to abuse the Bank at will
and then meekly surrendering to all the demands of the Bank to get the loan. Once the Bank agreed to
return conditionally, it went to the media to claim victory for the government!
In fact the Prime Minister said that the Bank activated the loan because it did
not find any proof of corruption. This led the Bank had to issue a harsh
statement accusing the government of “misrepresenting” facts and reminded it
that loan will not be activated till its concerns about corruption are resolved.
The
government’s failure in economic diplomacy has been visible in many other
instances as well. Its dealing with Japan is an excellent case study for
assessing the government’s disappointing performance in economic diplomacy.
When the Finance Minister was making frantic efforts to pull off a positive
reaction from the WB after accepting most of its demands before the
government’s most recent capitulation, he had said that the President of JICA
will talk on Bangladesh’s behalf with the President of the WB. In fact, the way
the news was given to the media, the Minister tried to give the impression that
the President of JICA had gone to Washington mainly to plead Bangladesh’s case.
In expecting Japan to take up Bangladesh’s cause with the WB, the Finance
Minister was blissfully unaware about the way the government has handled its
bilateral relations with Japan.
Japan
has been Bangladesh’s most important development partner since Bangladesh’s
independence. In the past four decades,
Japan has contributed to most of the major economic infrastructure projects of
the country. In addition, Japan has also contributed to critical areas of
socio-economic development of Bangladesh. Yet this government treated Japan like
Japan should be grateful to Bangladesh and not the other way round. For
instance, Bangladesh kept the Ambassador’s post in Tokyo vacant for over a year
and a new Ambassador has been sent to the post just recently. The previous
Ambassador was withdrawn under embarrassing circumstances. He was accused by a
Japanese woman who worked in the Bangladesh Embassy of sexual harassment, a
charge that in the Japanese context is as demeaning and offensive as it can
get.
The
Ambassador was kept in his post while the Bangladesh government conducted its
investigation! Common sense should have
dictated the Bangladesh Government to withdraw him using one of the many
options that are available in conduct of diplomatic relations to take care of
Japanese sensitivities. The Ambassador was withdrawn after a delay on many
months for investigations to be completed that found him guilty as charged. On
return, he has been allowed to carry on with his job in the Foreign Ministry as
a Director-General like business as usual.
Other
countries send their best senior career diplomats or in case of political appointments,
individuals of highest distinction, as Ambassador to Japan. Vice President Walter Mondale was US
Ambassador to Japan. It is common place in Japan’s diplomatic circles to come
across many ex-ministers as Ambassadors representing their countries. Yet for
some unknown reason, the government chose a junior Joint Secreteray who turned
out to be an embarrassment for the Government as its Ambassador to Japan. His
appointment must have made Japan unhappy; the failure to withdraw him
immediately after the accusation of sexual harassment and to have allowed him
to join MFA as Director-General without any action against him must have
seriously offended Japan.
It
is a wonder of sorts that after such faux pas, the government lacked the sense
to keep the post vacant for over a year!
In the diplomatic parlance, a post at Ambassador’s level is kept vacant
this long to send a negative message. One wonders what message the Bangladesh
Government was trying to send to Japan. After a year of dementia (there is no
other way to explain why Tokyo was kept vacant for a year), the Ambassador to
Italy has been sent to Japan. Unfortunately, the new appointment has come too
late to undo the diplomatic damages already done. The insensitivity over the
issue of recalling the last Ambassador and the long delay in sending the new
one no doubt are examples of poor conduct of diplomatic relations in general and
economic diplomacy in general given Japan’s unquestioned importance to Bangladesh.
The
Finance Minister’s briefing to the media about JICA President’s offer to plead
the case of Bangladesh to the WB to reactivate the PB loan after it was
cancelled last June is another example that showed little awareness of Japanese
sensitivities. For those who understand Japan and the WB know that on the
cancellation of the PB loan, the WB must have consulted JICA in a professional
manner, outside the media where both were on the same page before the WB made
its announcement. Even if there was a
possibility of Japan requesting the WB for reactivating the loan after
Bangladesh government submitted to the demands of the WB, it was another
diplomatic faux pas to have revealed it in the media as the Finance Minister had done. Diplomacy does not
work that way.
The
Finance Minister and other Ministers of this government unfortunately seem
unaware that the conduct of diplomacy is delicate where confidentiality and
discretion are matters of essence.
People at WB/JICA do not conduct diplomacy through the media because it
is the surest way to kill diplomatic initiatives. In this term, it is not just
diplomatic sensitivities that this government has forgotten; it has even
forgotten how Japan conducts its aid relations.
The way it handled another mega project, namely the 22 km metro rail project in Dhaka is an
example where those conducting economic relations have shown a sudden lack of
awareness about Japan’s way of conducting aid relations that they should have
known like the back of their hands from nearly 4 decades’ experience of aid
relations with Japan.
Japan
agreed to fund through JICA, 80% of the estimated cost of US$ 2.7 billion for
the project. Four aid missions came to Dhaka to negotiate the details of the
project and its funding. After everything was in place and the agreement was
ready for signing, the Air Force objected to allow the metro rail project
through the old airport. The cabinet decided to change the route expecting
Japan to agree. Japan did not because it is unimaginable in the way Japan
conducts its aid reactions that changes will be made when an agreement is at
the signing stage. What our negotiators failed to realize is that once the
negotiations were complete, authorities in Tokyo went ahead and made the
necessary provisions in the budget. Once
the funding fell through, the authorities had nearly US$ 2 billion in its hand
that it did not know where to reimburse. Unlike our system, Japan’s parliament
that keeps a strict handle on Japanese ODA is very harsh on bureaucrats when something
like this happens.
Somehow
this government seems to have an attitude of self-righteousness that is hard to
explain, that if a decision is taken by the Prime Minister or at her
instruction at the Cabinet; it simply cannot be wrong. Thus when the Prime Minister decided to go
after Dr. Mohammad Yunus and the Grameen Bank, no one in government dared
remind her that she was pursuing both on reasons that are not correct and that
she was ending up on the wrong side on the most important country, namely the
United States, for Bangladesh in pursuing its international goals and goals of
economic diplomacy. Powerful development partners in the developed world have
also openly expressed their annoyance with the Bangladesh Government on Dr.
Yunus and the Grameen Bank.
Writing
for the Wall Street Journal, former US Ambassador to Bangladesh William Milam
asked the US Government and the other development partners to withhold its aid to Bangladesh to impose
some sense upon the government to stop it from destroying the Grameen Bank. Sir
Richard Branson, the founder of Virgin Airways, in a column in the Times asked
the British Government to use its US$ 1.6 billion aid package over the next 3
years to bring some sense upon the Bangladesh government on the GB issue.
The
mindset of self-righteousness that the Prime Minister can do no wrong when
dealing with nations and institutions abroad
is what has messed up with the way this government has pursued diplomacy
in general and economic diplomacy in particular. It is therefore hardly
surprising that the term economic diplomacy that was the heartbeat of the AL
government in pursuing its foreign policy goals on issues of economic aid ,
trade and foreign investment in its last
term is hardly heard or spoken in this term.
The
mindset that the Prime Minister can do no wrong has also made it impossible to
build the team work necessary for economic diplomacy to succeed. There is
apparently no coordinating mechanism for conducting economic diplomacy. Ministers and party leaders take upon
themselves the responsibility of giving views on issues of economic diplomacy
in the media caring little that expressing such views are detrimental to the
country’s interests. The way these Ministers and party leaders have gone to the
media on PB loan has highlighted this free for all style of conducting the
country’s economic diplomacy where the cardinal principle is to guess the Prime
Minister’s mind and make every attempt to please her right or wrong caring
little for the country's interests.
As
a consequence countries and financial institutions that are important for our
economic development are distancing themselves from Bangladesh. Dark clouds are
thus gathering over the RMG that contributes 60% of Bangladesh’s export
earnings where the country has fallen at odds with powerful labour groups of
the US on issues of human rights that the government refuses to acknowledge,
let alone address; again because the Prime Minister does not see any merit in
the allegations. Remittance has shown
growth but it has been largely as a result of huge amount of black money that
was siphoned off from the share market being whitened through the remittance
system. New markets have not opened for the country while traditional and huge
markets like the one in Saudi Arabia are shrinking, partly on issues of foreign
policy where the government again is pursuing this self-defeating policy of
self-righteousness. Most recently, UAE, the second largest manpower market, has
stopped renewing and issuing new work visas.
The
poor handling of the government over the Padma Bridge loan, a major focus in
economic diplomacy for the country, continues. The WB postponed sending two
scheduled teams to Dhaka to start negotiations with the Bangladesh Government
from 1st of October. When rumours came out in the local media that
the postponement has been due to the WB’s annoyance with the irresponsible
statements of the leaders of the Bangladesh Government, the local office of the
WB issued a statement in which it stated that the two teams will come “within
October”. It the statement, the local office underlined that the teams will
come only after the WB completes finalizing a 3-5 member team of international
experts in corruption that will study the findings of the WB/ACC team on the allegations
of corruption and funding for the bridge will start only after the Bank
receives a favourable report from this international panel. Poor handling by
Bangladesh has thus once again made the much needed loan from the WB uncertain
again.
The
AL came to office in its current term with a massive mandate of the people of
Bangladesh and support from abroad. It is a tragedy that it wasted great
opportunities that came its way and that of the nation on issues that it
created for reasons that beg rational explanations. When history reflects upon
this AL government , this period will no doubt be described as one when reason
and common sense had taken leave of those who ran the government. It is little
wonder therefore that economic diplomacy that was so important for the AL in
its last term has all but been forgotten in its current term. . In fact in the totally personalized style of
governance based upon the belief that the Prime Minister cannot err that
highlights the AL’s current term there is little scope for economic diplomacy
or for that matter professional governance.
The writer is a
retired Secretary and former Ambassador to Japan.
No comments:
Post a Comment