Tag Archives: Global Affairs Canada

SNC Lavalin the corporate face of Ugly Canadian

Former SNC Lavalin board chair Gwyn Morgan and other company directors are still seen as pillars of Canada’s business community.

While the Justin Trudeau government’s interference in the prosecution of SNC Lavalin highlights corporate influence over politics, it is also a story about a firm at the centre of Canadian foreign policy.

In a recent story titled “Canada’s Corrupt Foreign Policy Comes Home to Roost” I detailed some of SNC’s controversial international undertakings, corruption and government support. But, there’s a great deal more to say about the global behemoth.

With offices and operations in over 160 countries”, the company has long been the corporate face of this country’s foreign policy. In fact, it is not much of an exaggeration to describe some Canadian diplomatic posts as PR arms for the Montréal-based firm. What’s good for SNC has been defined as good for Canada.

Even as evidence of its extensive bribery began seeping out six years ago, SNC continued to receive diplomatic support and rich government contracts. Since then the Crown Corporation Export Development Canada issued SNC or its international customers at least $800-million  in loans; SNC and a partner were awarded part of a contract worth  up to $400 million to manage Canadian Forces bases abroad; Canada’s aid agency profiled  a venture SNC co-led to curb pollution in Vietnam; Canada’s High  Commissioner Gérard Latulippe and Canadian Commercial Corporation vice president Mariette Fyfe-Fortin sought “to arrange  an untendered, closed-door” contract for SNC to build a $163-million hospital complex in Trinidad and Tobago.

Ottawa’s support for SNC despite corruption allegations in 15 countries is not altogether surprising since the company has proven to be a loyal foot soldier fighting for controversial foreign policy decisions under both Liberal and Conservative governments.

SNC’s nuclear division participated  in a delegation to India led by International Trade Minister Stockwell Day a few months after Ottawa signed a 2008 agreement to export nuclear reactors to India, even though New Delhi refused to sign the Nuclear non-Proliferation Treaty (India developed atomic weapons with Canadian technology). Describing it as the “biggest  private contractor to [the] Canadian mission” in Afghanistan, the Ottawa Citizen referred to SNC in 2007 as “an indispensable part of Canada’s war effort.” In Haiti SNC participated  in a Francophonie Business Forum trip seven months after the US, Canada and France overthrew the country’s elected President Jean-Bertrand Aristide. Amidst the coup government’s vast political repression, the Montreal firm met foreign installed prime minister Gérard Latortue and thecompany received a series of Canadian government funded contracts in Haiti.

SNC certainly does not shy away from ethically dubious business. For years it manufactured grenades for the Canadian military and others at its plant in Le Gardeur, Quebec. According to its website, SNC opened an office  in Johannesburg, South Africa, in 1982 amidst the international campaign to boycott the apartheid regime. Later that decade SNC worked on the Canadian government funded Manantali Dam, which led to “economic ruin, malnutrition and disease to hundreds of thousands of West African farmers.”

More recently, SNC has been part of numerous controversial mining projects in Africa. It had a major stake in a Sherritt-led consortium that initiated one of the world’s largest nickel and cobalt mines in Ambatovy Madagascar. Backed by Canadian diplomats  and Export Development  Canada, the gigantic open pit mine tore up more than 1,300 acres of biologically rich  rain forest home to a thousand species of flowering plants, fourteen species of lemurs and a hundred types of frogs.

According to West Africa Leaks, SNC dodged its tax obligations  in Senegal. With no construction equipment or office of its own, SNC created a shell company in Mauritius to avoid paying tax. Senegal missed out on $8.9 million  the Montréal firm should have paid the country because its ‘office’ was listed in tax free Mauritius. SNC has subsidiaries in low tax jurisdictions Jersey and Panama and the company was cited  in the “Panama Papers” leak of offshore accounts for making a $22 million payment to a British Virgin Islands-based firm to secure contracts in Algeria. (In a case of the tax-avoiding fox protecting the public’s hen house, former SNC president and chairman of the board, Guy Saint-Pierre, was appointed to Conservative Finance Minister Jim Flaherty’s 2007 advisory panel  on Canada’s System of International Taxation.)

SNC has benefited from Ottawa’s international push for neoliberal reforms and Canada’s power within the World Bank. A strong proponent of neoliberalism, the Montréal firm has worked  on and promoted  privatizing water services in a number of countries. Alongside Global Affairs Canada, SNC promotes the idea that the public cannot build, operate or manage services and that the way forward is through Public-Private Partnerships (PPPs), which often go beyond a standard design-and-build-construction contract to include private sector participation in service operation, financing and decision making. SNC is represented on the Canadian Council for Public-Private Partnerships, which promotes PPPs globally. The Montréal firm has also sponsored many pro-privatization forums.With Rio Tinto, Alcan, Teck Resources and the Canadian International Development Agency, SNC funded  and presented at a 2012 conference at McGill University on Public-Private Partnerships for Sustainable Development: Towards a Framework for Resource Extraction Industries.

In an embarrassing comment on the PPP lobby, the year before SNC was charged with paying $22.5 million  in bribes to gain the contract to build the McGill University Health Centre (MUHC) the Canadian Council  for Public-Private Partnerships and Thomson Reuters  both awarded the MUHC project a prize for best PPP.

Further proof that in the corporate world what is good for SNC is seen as good for Canada, the Canadian Institute of Chartered Accountants gave SNC its award for excellence in corporate governance in seven of the ten  years before the company’s corruption received widespread attention.

In an indication of the impunity that reigns in the corporate world, the directors that oversaw SNC’s global corruption have faced little sanction. After the corruption scandal was revealed board chairman Gwyn Morgan, founder of EnCana, continued to write a regular column for the Globe and Mail Report on Business (currently Financial Post) and continues his membership in the Order of Canada. Ditto for another long serving SNC director who is also a member of the Order of Canada. In fact, Conservative Senator Hugh Segal was subsequently made a member of the Order of Ontario. Another Order of Canada and Order of Ontario member on SNC’s board, Lorna Marsden, also maintained her awards. Other long serving board members — Claude Mongeau, Pierre Lessard, Dee Marcoux, Lawrence Stevenson and David Goldman – received corporate positions and awards after overseeing SNC’s corruption.

The corporate face of this country’s foreign policy is not pretty. While Trudeau’s SNC scandal highlights corporate influence over politics, it’s also the story of the Ugly Canadian abroad.

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Canadian ‘aid’ to Venezuela part of plan to overthrow government

Canadian ‘aid’ has long accompanied war and coups designed to protect ‘Western interests’

If more people understood that “aid” often goes hand in hand with military intervention there would be less uncritical support for it.

An important, though little acknowledged, principle of Canadian ‘aid’ policy is that military intervention elicits international assistance. Or, in the case of Venezuela ‘aid’ is a tool being used to stoke military conflict.

In fact, a long-standing element of foreign policy is that wherever Canadian and US troops kill Ottawa provides ‘aid’. This military-intervention-equals-aid pattern dates back at least to the 1950-53 Korean War when the south of that country was a major recipient of Canadian assistance. Canadian ‘aid’ flowed  to south Vietnam during the U.S. war there and to Grenada after the 1983 US invasion. During the 1990-91 Iraq war Canada provided $75 million in assistance to people in countries affected by the Gulf crisis. Hundreds of millions of dollars flowed into Haiti after Canadian troops helped overthrow the country’s elected government in 2004. In the years after the invasions, Afghanistan, Iraq and Haiti were the top three recipients of Canadian ‘aid’. A sizable proportion of the $2 billion in ‘aid’ Canada spent in Afghanistan was a public relations exercise to justify the war.

The intervention-equals-aid pattern is an outgrowth of the primary objective of Canadian overseas assistance, which is to advance Western interests, particularly keeping the Global South tied to the US-led geopolitical order (as articulated  in 1950 when Ottawa began its first significant non-European allocation of foreign aid through the Colombo Plan).

Justin Trudeau announced Canada would deliver $53 million in ‘aid’ to Venezuelans at the most recent “Lima Group” meeting. The Ottawa gathering also called on the Venezuelan military to oust  the elected president and urged the military not to impede humanitarian assistance from entering the country. The US and self-appointed interim president Juan Guaidó have made delivering ‘aid’ central to their campaign to oust Maduro. US military planes have transported hundreds of tons of ‘aid’ to the Colombian border City of Cucuta. To test the military’s loyalty to the government, Guaidó announced plans to force ‘aid’ into the country.The US and Colombia clearly aimed exploit this moment to intervene.

Billionaire Branson’s concert drew a much smaller crowd than the 300,000 predicted.

Whether it reaches the point of armed confrontation, the ‘aid’ gambit is a public relations strategy. The aim is to exaggerate the scope of the economic downturn and to portray Nicolas Maduro as indifferent to the population’s (real) hardships.The public relations campaign even included a “Live Aid” style Venezuela fundraiser put on by billionaire Richard Branson in Cucuta last night before Guaido said he will seek to force ‘aid’ into the country. The concert fizzled with only about 5,000 people showing up and some artists pulling out at the last minute.

For their part, the International Red Cross and UN have refused to participate in the US led ‘aid’ endeavor. A UN spokesperson called Washington’s ‘aid’ plan “politicised”.

The politics driving the ‘aid’ deployment is obvious, but some progressives have been seduced by the label. In an internal memo responding to media backlash over their principled criticism of Ottawa’s regime change efforts in Venezuela, the Canadian Union of Public Employees (CUPE) said it supports the federal government’s decision to increase humanitarian assistance to Venezuelans. But, the slow-moving coup attempt and Canadian ‘aid’ disbursements can’t be separated. They are simply different parts of a single plan.

It’s not uncommon for progressive organizations to support ‘imperial aid’ as a way to soften their criticism of international policies. At their 2006 convention, for instance, the NDP leadership sought to temper the “troops out” of Afghanistan demand pushed by activists by including language in the resolution that called for “support[ing] the continuation of development assistance to Afghanistan.” But, the ‘aid’ there was obviously designed to support Canada’s military occupation.

In the academic literature it’s understood that the Canadian International Development Agency was “not a policy maker, but a policy taker.” The dissolution of CIDA into Global Affairs Canada in 2013 further subordinated aid policy to foreign policy objectives.

Far and away the largest contribution announced, Canada’s humanitarian assistance to Venezuela is not designed to alleviate suffering. Its aim is to overthrow the government, which may spark and/or require war. If that disastrous situation develops, we need to add the ‘aid-leading-to-military intervention principle’ to our critical foreign policy lexicon.

 

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