The prominent non-governmental public partner, Menschen für Menschen Foundation (MfMF), on February 8, inaugurated another in a series of crucial water system projects. The new water system is located in the towns of Lemi and Robit. It cost over half a million euro and will benefit 6,240 people in the two small towns located in Wegidi Wereda, South Wello Zone, Amhara region.
According to a statement that Capital obtained from MfMF, the project consists of supplying electro-mechanical units, drilling a borehole, construction, civil engineering and installing electromechanical works, providing consultancy services, supervising construction and building the capacity of the community. It is expected to function for 30 years. To complete the Lemi-Robite Rural Towns Water Supply Project they had to build 26 water points (23 for public use and 3 for schools), 11.3km of a distribution main, a 3.56km pressure main, 5 showers (two for public use and 3 for schools), four VIP latrines (two for the public and two for schools), and a 200 cubic meter reservoir. All of this cost 576,723 euro. Out of this the total community contribution both in labor and cash was 67,251 euro.
“The project work started on December 31, 2015. This involved drilling a well that now yields 3.7 liters per second. After a deep borehole was drilled, the civil work, construction and installation of the electromechanical unit of the project started on August 26,2016,” the statement explained.
Thanks to this project,water supply, sanitation and hygiene coverage of the Lemi and Robite community has increased from 18.49 to 100 percent. It used to take an hour to fetch water in the towns but now it only takes ten minutes.
“The project has reduced the burden of women and children by supplying piped water closer to their homes and has improved the health of the beneficiary community by providing safe and adequate drinking water, environmental sanitation and hygiene,” MfMF stated.
In addition, the project has also contributed immensely toward achieving national WASH goals and targets set in the National Development Plans, such as the Universal Access Plan (UAP) and the Sustainable Development Goals (MDG) by addressing potable water supply sanitation and hygiene.
The Lemi-Robite Rural Towns Water Supply Project has beenfully funded by German Federal Ministry of Economic Cooperation and Development (BMZ) and implemented by Menschen für Menschen Foundation. Previously, the Menschen für Menschen Foundation built five rural town water supply systems, namely: Alge in Ilu Ababora zone, Lemi and Ginager in North Shewa zone, Arekit in Gurage zone and Lemi-Robite in South Wello zone. In addition, Seyo and Makafta rural town projects are also under construction in West Shewa and South Wello zones. The Foundation has also developed 2,369 hand-dug wells and springs in various parts of the country that have benefited 704,200 people.
Two rural towns get new water system from German NGO
‘Africa’s Satellite’ avoided millions using a very African Tax Scheme
The companies behind the New Dawn Satellite channeled millions of dollars through offshore companies in Mauritius, one of the continent’s premier tax havens.
At 5:37 p.m. on April 22, 2011, from a seaside launch pad in Latin America, a hulking satellite rose into the sky and came to rest over the 33rd meridian east, above northern Tanzania.
The New Dawn Satellite was proudly African – partly funded by local investors and promoted as a way for African schoolchildren, nurses, civil servants and businesses to access world-class internet and mobile phone networks.
But if its purpose was to promote African development, its tax strategy did exactly the opposite.
The companies behind the New Dawn Satellite channeled millions of dollars in payments from African companies and governments through offshore companies in Mauritius, one of the continent’s premier tax havens.
In so doing, the companies achieved a Mauritian double-whammy, using one kind of offshore company to avoid local taxes and another to pay as little as possible on bills paid from overseas using treaties signed between Mauritius and its African neighbors.
The primary money-making company estimated that it would pay $22,500 in taxes on $75 million in revenue – just 0.03 percent.
In a 17-year lifespan, the company predicted, it would earn $936 million yet never pay taxes above $300,000.
That’s according to a PowerPoint presentation from the Paradise Papers, offshore documents that include nearly seven million files from the law firm Appleby and its clients, including the satellite’s co-owner, Intelsat.
“The purpose of the tax structure is to drastically minimize the tax exposure of the company and pay as little as possible, which the company has successfully achieved,” said Alexander Ezenagu, an international tax researcher with International Centre for Tax and Development, who analyzed Intelsat’s documents.
The Mauritius arrangement lasted until 2013 when Intelsat closed the companies down after unexpectedly low financial returns. The company’s tax return that year reflects that it paid 0.09 percent tax on $31.6 million.
Intelsat told the International Consortium of Investigative Journalists that it “has a proud history of serving the African continent, providing vital connectivity and access to world-class technology since the late 1960’s.” It said Mauritius was chosen “in concert” with its South African investment partners.
“We pay taxes where we have established a taxable presence, such as our regional office in South Africa,” Intelsat said. “Where we do not have a taxable presence, in nations where applicable, our services are taxed through withholding taxes, which are paid on our behalf by our customers under our contractual agreements.” According to other tax experts, though, those payments are unlikely to be made.
The New Dawn project was terminated in 2013 “following a major satellite anomaly that irreparably reduced the commercial viability and financial returns expected from the project,” Intelsat said.
Though not a household name, Luxembourg-based Intelsat’s technologies are behind some of the 20th Century’s most enduring memories.
Intelsat’s satellites, for example, allowed millions to watch the 1969 moon landing and the 2000 Sydney Olympics. Its satellites cover 99 percent of the world’s population, allowing cell phone and internet providers to offer phone calls, online surfing and television.
In 2008, Intelsat announced plans to launch the New Dawn satellite, its first with an African focus.
The satellite, built in Virginia, used channels or “transponders” that helped send information via antennas to earth.
For years, governments and the private sector have salivated at prospects for Africa’s development – if only there were improvements to the continent’s communication black holes.
Intelsat used the Appleby law firm and accounting firm KPMG to establish the Mauritius companies behind the New Dawn satellite.
Intelsat’s Bermuda-based subsidiary and South Africa’s Convergence, a consortium of largely African investors, were initial investors. (Convergence left the partnership after one year.)
Following the satellite’s 2011 launch and the first customer orders, the African tax haven strategy proved lucrative, according to dozens of invoices, tax returns and financial statements from the Paradise Papers.
Nearly all New Dawn’s income came from cell phone and satellite companies, including Airtel, one of Africa’s major providers. Namibia’s government-owned telecommunications company, Telecom Namibia, and South Africa’s state-owned signal distributor, Sentech, were also customers.
Airtel’s subsidiaries paid Intelsat’s Mauritius-based company, New Dawn Distribution Company Ltd. for services in that included Sierra Leone, the Republic of Congo, Chad, Gabon, Madagascar, Niger and the Democratic Republic of the Congo – then the poorest country in the world. Some contracts brought in $100,000 a month.
In 2012, for example, Intelsat’s Mauritius company sent a bill to Airtel in the Republic of Congo for $201,000. Under a 2011 treaty, the Republic of Congo agreed to waive taxes on its domestic companies worth up to 20 percent on the value of services provided by companies in Mauritius, such as Intelsat’s. In this one invoice alone, then, the Republic of Congo could have forgone up to $40,000 in taxes on the $201,000 bill paid from the client to Intelsat’s Mauritian shell company.
Intelsat did not respond to ICIJ’s specific questions about whether or not its customers paid reduced or no taxes under treaties. It told ICIJ that, in general, “we pay withholding taxes, where required, through contractual terms with our customers in the countries where the services are being consumed.” Airtel declined to comment.
“That’s exactly the problem,” said Alvin Mosioma, executive director of Tax Justice Network – Africa, who described telecommunications companies as “one of the major culprits on the continent when it comes to aggressive tax avoidance.”
Using treaties in this way, Mosioma said, “shifts the responsibility to the telecommunications companies.”
The end result, Mosioma said, is that some taxes might not be paid at all. Treaties such as the one signed between the Republic of Congo and Mauritius could have allowed Intelsat to avoid or reduce tax in Mauritius and could have scrapped some taxes entirely in the Republic of Congo that would, without a treaty, be paid by Intelsat’s customer.
Financial and company laws in Mauritius, researcher Ezenagu says, “are structured to provide tax advantage to companies at the detriment of countries where the real economic activities occur and value is created.” Intesalt’s structure “takes advantage” of these laws, Ezenagu said.
“I would honestly think, by now, that tax treaties with Mauritius should have become discredited,” he said. “They simply do not grant the benefits to the countries that they were told they would.”
By Will Fitzgibbon
NEW DAWN PROJECT
International Consortium of Investigative Journalists
Tana Forum to focus on financing, reforming the African Union
Paul Kagame, President of the Republic of Rwanda and current AU Chairperson, will deliver the keynote address at the 7th Tana Forum which will be carried out in April 2018 in Bahir Dar, with the theme of:, “Ownership of Africa’s Peace and Security Provision: Financing and Reforming the African Union”. It is expected to generate convergent views on Africa’s security delivery analyzed through the lens of AU reform.
In 2016, the AU Assembly of Heads of State and Government met in Kigali, Rwanda, and made a key decision on financing the Union, agreeing to implement a 0.2% levy on all eligible imported goods to the continent. The reform process, which will be implemented between 2017 and 2018, includes institutional reforms that will realign and manage the AU efficiently at both political and operational levels, and more importantly, make provision for a more sustainable funding for peace building in Africa.
The annual Forum was conceived by the late Prime Minister Meles Zenawi. The Tana Forum is an independent initiative that seeks to provide an informal platform for African Heads of State and Government to engage in open and frank discussions with a wide spectrum of non-state stakeholders on the most pressing peace and security issues confronting the continent.
President Kagame recently noted, “Insecurity takes many forms, from terrorism to uncontrolled migration to divisive politics or even consequences of the failure to adapt to climate change. But whatever the challenge is, we can most successfully address it by working together.”
Previous keynote speakers have included Thabo Mbeki, former President of South Africa (2013), former UN Secretary-General Kofi Annan (2015) and former President of Liberia Ellen Johnson Sirleaf (2016).
“We are pleased to have President Paul Kagame as our keynote speaker for this year’s Tana Forum,” says Olusegun Obasanjo, former President of Nigeria and outgoing Chairperson of the Tana Forum. “A long-time supporter of the Forum, President Kagame’s vision is to work together at a continental level in achieving a more efficient, self-reliant and more effective African Union.”
Que Bueno!
The president of Equatorial Guinea Teodoro Obiang Nguema Mbasogo spent three days in Addis Ababa where he signed a cooperation agreement with Prime Minister Hailemariam Dessalegn.
The two countries agreed to work together to recruit workers, develop infrastructure and increase defense. The president, who came with a business delegation, said his country will strengthen its ties to do a better job than before.
Hailemariam said “we have agreed to work very closely on an international agenda. Now both of us are members of the UN Security Council and we will take the African agenda together for the issues we have to the United Nation Security Council. As the president is the most pan-African leader I think this agenda will be worked out together,” he said.
The President also visited the Addis Ababa City Administration and held talks with officials of the Administration.
The bilateral ties between the two countries started in the 1970’s. Equatorial Guinea is also one of Africa’s largest oil exporters.
