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Theresa May to spend aid money on insurance against disasters in Africa

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Anushka Asthana and Patrick Wintour

Theresa May is planning to spend tens of millions of pounds of aid funding on buying premiums with British insurance companies to help cover the costs of natural disasters in African countries, such as severe drought.
The prime minister believes that buying up private insurance policies in the UK, in a break from more traditional forms of aid spending, could reduce the need for expensive direct humanitarian support in the future.

A senior Downing Street official said the plan was to spend £30m over four years on the initiative, after which the companies would be able to continue working directly with African countries, opening up the opportunity to make a profit.

Oxfam’s senior policy adviser, Max Lawson, said that “harnessing the resources of the insurance industry is an interesting idea”, but said it must be judged on any benefits for poor countries and not the City of London.

The prime minister could face a backlash from critics of Britain’s aid budget in the UK, who believe that more should be done to help uninsured people at home facing flooding or other crises.

May laid out the plans at the G20 summit in Hamburg as part of a £200m package that aims to boost economic growth within African countries in order to make them less dependent on aid.

“We must not forget that progress in Africa benefits the UK at home. Our international aid work is helping to build Britain’s trading partners of the future, creating real alternatives to mass migration, and enhancing our security,” she said.

May added that it was also about a “moral responsibility” to meet the humanitarian needs of the poorest people on the planet, adding: “This is the future of aid, delivering value for money for the taxpayer.”

The prime minister was trying to echo Angela Merkel, the German chancellor, who has made her Compact with Africa the centrepiece of the two-day summit, rivalling Tony Blair’s drop the debt theme at the G8 in Gleaneagles, Scotland in 2005.

The aim is to boost private investment in a select group of African countries in the hope that they can act as the pioneers of a wider growth drive across the continent.

The German initiative warns: “By 2050 an estimated 2.5 billion people will live on the continent, almost twice as many as there are now. By 2030, approximately 440 million people will be looking for work.” Yet African economic growth has been slowing, partly due to a fall in commodity prices.
The German government argued: “Only $130bn (£100bn) a year would be enough to expand African infrastructure – roughly equivalent to the total amount of public aid for the continent.”

The Merkel plan has a self-serving element, since Germany is concerned that unless Africa, with its fast-growing youthful population, finds new jobs, many of the new generation will follow the path of hundreds of thousands of Africans struggling across the Mediterranean into Italy.

May also warned that 20m jobs needed to be created in Africa every year until 2035 to absorb new entrants into the labour force, arguing that failure to provide work meant “destabilising migratory patterns will persist – with extremist causes and criminality more likely to thrive”.

The package includes the new London Centre for Global Disaster Protection, which will aim to “use world-leading UK expertise and innovation to help developing countries strengthen disaster planning and use insurance to provide more cost-effective, rapid and reliable finance in emergencies, such as the severe drought in east Africa”.

Downing Street added: “This will reduce the need for expensive humanitarian aid, reassure private investors and help people rebuild their lives. Insurance protection built through this centre could provide £2bn when crises hit to ensure that the high costs of disasters aren’t borne by people or businesses, trapping them in cycles of poverty.”

The government said a further £60m was about building up a “robust and transparent financial sector” to attract more investment. “This paves the way for a strong partnership with the City of London, creating more opportunities for London to become the finance hub for Africa.”

Max Lawson of Oxfam said stimulating growth could help the fight against poverty. “But it is important to recognise that growing economies will not automatically provide people with enough food to eat or life-saving medicines – especially as Africa is home to some of the most unequal countries on Earth. We urge the government to set out in practical terms how it will ensure those who most need our help will reap the benefits of this initiative.”

He also stressed the need to tackle climate change.

Labour MP Stephen Doughty agreed that global warming threatened the lives of millions, but called the prime minister weak in the face of Donald Trump’s withdrawal from the Paris agreement. “She has no intention to stand up to the US president’s selfish agenda on climate change and global poverty,” he said.

Doughty welcomed support for development in African economies, but said it must not be at the expense of investment in strong public health and education systems.

Briefing Room

Diplomatic leaks: UAE dissatisfied with Saudi policies

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AL JAZEERA — Abu Dhabi Crown Prince Mohammed bin Zayed (MbZ) is working on breaking up Saudi Arabia, leaked documents obtained by Lebanese newspaper Al Akhbar revealed.

Al Akhbar said that the leaked documents contained secret diplomatic briefings sent by UAE and Jordanian ambassadors in Beirut to their respective governments.

One of the documents, issued on September 20, 2017, disclosed the outcome of a meeting between Jordan’s ambassador to Lebanon Nabil Masarwa and his Kuwaiti counterpart Abdel-Al al-Qenaie.

“The Crown Prince of Abu Dhabi Sheikh Mohammed bin Zayed is working on breaking up the Kingdom of Saudi Arabia,” the Jordanian envoy quoted the Kuwait ambassador as saying.

A second document, issued on September 28, 2017, reveals meeting minutes between the Jordanian ambassador and his UAE counterpart Hamad bin Saeed al-Shamsi.

The document said the Jordanian ambassador informed his government that UAE believes that “Saudi policies are failing both domestically and abroad, especially in Lebanon”.

“The UAE is dissatisfied with Saudi policies,” the Jordanian envoy said.

The Qatar vote
According to the leaks, UAE ambassador claims that Lebanon voted for Qatar’s Hamad bin Abdulaziz al-Kawari in his bid to become head of UNESCO in October 2017.

“[Lebanese Prime Minister Saad] Hariri knew Lebanon was voting for Qatar,” the UAE ambassador said in a cable sent to his government on October 18, 2017.

In November last year, Hariri announced his shock resignation from the Saudi capital Riyadh.

He later deferred his decision, blaming Iran and its Lebanese ally in Lebanon, Hezbollah, for his initial resignation. He also said he feared an assassination attempt.

Officials in Lebanon alleged that Hariri was held hostage by Saudi authorities, an allegation Hariri denied in his first public statement following his resignation speech.

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Somalia’s Puntland region asks UAE to stay as Gulf split deepens

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BOSASO, Somalia (Reuters) – Somalia’s semi-autonomous Puntland region urged the United Arab Emirates not to close its security operations in the country after a dispute with the central government, saying the Gulf power was a key ally in the fight against Islamist militants.

The dispute goes to the heart of an increasingly troubled relationship between Gulf states – divided by their own disputes – and fractured Somalia, whose coastline sits close to key shipping routes and across the water from Yemen.

Analysts have said the complex standoff risks exacerbating an already explosive security situation on both sides of the Gulf of Aden, where militant groups launch regular attacks.

The central Somali government said on Wednesday it was taking over a military training program run by the UAE.

Days later the UAE announced it was pulling out, accusing Mogadishu of seizing millions of dollars from a plane, money it said was meant to pay soldiers.

“We ask our UAE friends, not only to stay, but to redouble their efforts in helping Somalia stand on its feet,” said the office of the president of Puntland, a territory that sits on the tip of the Horn of Africa looking out over the Gulf of Aden.

Ending UAE support, “will only help our enemy, particularly Al Shabaab and ISIS (Islamic State),” it added late on Monday.

SUSPICION, RESENTMENT

The UAE is one of a number of Gulf powers that have opened bases along the coast of the Horn of Africa and promised investment and donations as they compete for influence in the insecure but strategically important region.

That competition has been exacerbated by a diplomatic rift between Qatar and a bloc including the UAE. In turn, those splits have worsened divisions in Somalia.

Puntland, which has said it wants independence, has sought to woo the UAE which runs an anti-piracy training center there and is developing the main port. The central government in Mogadishu last year criticized Puntland for taking sides in the Gulf dispute. Qatar’s ally Turkey is one of Somalia’s biggest investors.

One Somali government official said last week Mogadishu had decided to take over the UAE operation because the Gulf state’s contract to run it had expired. Another official said the government was investigating the money taken from the plane.

The competition among Gulf states in Somalia has fueled accusations of foreign interference and resentment in many corners of Somali society.

The loss of the UAE program could have a destabilizing effect, said one security analyst, speaking on condition of anonymity.

“The value of the UAE trained forces was two-fold – they were relatively well trained but, most importantly, they were paid on time,” unlike other parts of the security forces, the analyst told Reuters.

Somalia has been mired in conflict since 1991.

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Puntland President calls UAE continue its mission in Somalia

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