By Helmut W. Ganser
HAMBURG, Germany, Feb 6 2023 – The decision of Germany and other NATO states to supply modern battle tanks and other armoured infantry vehicles to Ukraine takes the West’s involvement in the war to a new level.

Presumably, in the further course of the war, the numbers mentioned so far will not be enough; the decision to provide tanks immediately sparked an international debate on delivering fighter planes as well.

We are also hearing initial calls for NATO troops to be deployed to Ukraine as a ‘deterrent’, which would mean NATO becoming embroiled in the war. However, the discussion about the objectives in the Ukraine war mustn’t be muddied, even if clarifying these leads to a fierce dispute both within and amongst the NATO states. There is just too much at stake.

The American and German governments indicate that they want to enable Ukraine to hold the frontline which it has fought for so far and liberate more areas wherever possible. All occupied territories, including Crimea, would probably be regained through a strategic approach of lengthy negotiations under the pressure of overwhelming Western sanction packages.

This objective comes with the broader demand that Ukraine be enabled to reconquer its entire territory through military counterattacks, something also put forward by the Ukrainian leadership. The serious risks of escalation associated with this must be thoroughly analysed, which has largely been skirted around in the discussions so far.

The fog of war prevents us from predicting how things will play out. All professional military policy experts are aware that their analyses, evaluations and forecasts are clouded by this; there are always bound to be frictions and surprises. However, looking at various scenarios can help us refine our assessments of what might be on the horizon.

We will attempt to assess the potential effects of the new tank deliveries to Ukraine, using two scenarios that look ahead to the early summer of 2023. In both scenarios, it is assumed that the Ukrainian army will gradually receive about 100 Western battle tanks, most of the Leopard model, and around 100 largely German and American infantry vehicles by early summer 2023.

The 31 M1 Abrams tanks previously promised are unlikely to be delivered by this point. Two tank battalions and two tank grenadier battalions – roughly equivalent to a brigade – will be equipped with the new heavy weapons systems by the early summer under both scenarios.

Another assumption is that the widely anticipated Russian spring offensive, targeting the Luhansk or Donetsk area, will begin around the end of February or March. Very few Western battle and infantry vehicles, if any, are likely to be used, in what are expected to be highly intense battles with severe casualties.

It is assumed with some uncertainty that the more professional and mobile Ukrainian defence can ward off larger operational gains from the major Russian units. These two scenarios look to the early summer after the Ukrainian army has taken delivery of the tanks from the West.

By the late spring, it becomes clear that the Ukrainian military intends to push hard towards the south from the area east and southeast of Zaporizhzhia. The goal is to advance over about 100 km to the Sea of Azov and cut the Russian troops off south of the river Dnieper and, more than anything, to stop Crimea from being supplied via the land bridge.

The terrain in this area is mostly open and flat – highly beneficial to tanks – and, with the exception of the town of Melitopol, is only dotted with small villages. In the early summer of 2023, Ukraine makes bold advances south under favourable weather conditions, targeting the Sea of Azov coast.

This results in the first major tank battle of the war, which sees German Leopards and Marders deployed at the front, as well as the American Bradleys and Strikers. With their better armour, agility and weapon effect, they clearly come out on top in a head-to-head battle.

Ukrainian commanders, however, struggle to master the complexity of mixed-weapons combat, in which battle tanks, armoured infantry vehicles with tank grenadiers, artillery, sappers and air support must work together in close coordination to achieve the full force of impact. Heavy Russian tank and infantry forces withstand the advancing units.

The Ukrainian counterattack progresses for about 30 km but then gets bogged down in the huge defensive firing, after Russian mechanised units succeed in pushing into the flank of the Ukrainian tank formations, jeopardising their supply. Soldier and material losses are severely high again on both sides.

Pictures of destroyed Leopard tanks are plastered across the internet. German television channels and online media increasingly draw parallels with historical footage of German tanks during the Second World War in the same region.

From a political and strategic perspective, attrition warfare has been consolidated in this scenario, despite tactical gains on both sides. Russia still has about 10 to 12 per cent of the Ukrainian territory under its control.

The extensive exhaustion of weapons systems, spare parts and ammunition from the German and American armies is increasingly running down the operational capability and perseverance of the NATO forces on both sides of the Atlantic.

As production capacity remains limited, there is increasing support for an agreement between the US, Ukraine and Russia to bring an end to the war. In Ukraine, the devastating losses are affecting more and more families, leading to political demands for a ceasefire. Opposition politicians demand that their president publish the actual losses incurred since the war began.

Scenario 2 is identical to scenario 1 up to the Ukrainian army’s counterattack from the area east of Zaporizhzhia. But in this scenario, operations are proceeding as planned by the Ukrainian General Staff. Kyiv has deployed forces equipped with Western tanks and infantry vehicles to the heart of the battlefield.

With the superior firepower, armour and agility of the Leopard 2 tanks, they advance towards intermediate targets northeast of Melitopol after a few days. Leadership, fighting strength and motivation are once again proving weak amongst Russian ranks, while the Ukrainian troops’ command of mixed-weapons combat is better than initially expected by Western military experts.

Leopard spearheads reach villages just off the coast, opposite Crimea. As Ukrainians advance, American-made HIMARS rockets destroy the new Russian bridge near Kerch in some places, rendering it unusable for supplying Crimea. Russia responds with the most intense air raid ever launched on Kyiv, with numerous casualties reported and electricity supply destroyed.

The Russian president makes a brief statement following a stage-managed press conference with his General Staff. Putin first states that the Russian Federation now considers the NATO states that supplied heavy weapons to Ukraine as direct opponents in the war, regardless of any fine details in international law.

The ongoing attack on Russian-occupied Crimea could only have come about through the massive involvement of Western states. The war has now created an existential dimension for the Russian Federation. As far as Russia is concerned, the entire war zone now extends to the territory of the Western states supporting Ukraine.

He refrains from verbal warnings of nuclear war because his earlier threats were not taken seriously. Putin says he has ordered his Defence Minister and General Staff to supply some of the nuclear-capable missile troops with the nuclear warheads stored in depots.

If the blockade of supplies to Crimea via the land bridge is not removed, Russia must use force through its tactical nuclear weapons. Russian bloggers report that the course of the war has brought unity to Kremlin leaders and only made them more determined to see it through, but this cannot be verified.

A few hours later, American satellites pick up Russian convoys beginning their journey from the nuclear weapons storage facilities to the nuclear missile battalion deployment areas. This secret intelligence becomes public across the world.

In a widely unexpected twist, China announces the largest mobilisation of its naval forces ever in the Strait of Taiwan. Its first fleet of warships has already set sail. The US and its NATO partners are now on the verge of a nuclear face-off that has escalated faster than many had believed, with consequences unimaginable for the whole of Europe.

Western governments, the NATO Council and Military Committee, as well as the UN Security Council, meet day after day. Commentators can’t help but compare it to the height of the Cuban crisis. But NATO leaders clash on their assessments of the situation and their approach. In Berlin, huge demonstrations are held calling for an immediate end to the war, with the slogan ‘Stop the madness’.

Of course, more optimistic scenarios can also be envisaged in which the Kremlin hands back Crimea without nuclear escalation. The powers that be, including those in Berlin, Washington and Paris, have so far held firm on their objective of not stepping into the grey area of getting directly involved in the war.

But the danger of slowly and unintentionally sleepwalking into what would be the biggest catastrophe for the whole of Europe is growing and growing. Unexpected twists and turns (sometimes referred to as black swans or wild cards) can also create dynamic developments that are likely to be extremely difficult to control and contain.

As more German tanks are sent to Ukraine, Germany’s share of responsibility for the course that the war takes – and the consequences thereof – increases and ultimately so does its right and need to influence the leadership in Kyiv.

Helmut W. Ganser, Brigadier General (retd), is a graduate psychologist and political scientist, who acted as Deputy Head of the Military Policy Department at the Ministry of Defence in Berlin, lecturer on strategy at the German Armed Forces Command and Staff College and military policy advisor to the German Permanent Representatives to NATO and to the UN.

Source: International Politics and Society (IPS)-Journal published by the International Political Analysis Unit of the Friedrich-Ebert-Stiftung, Hiroshimastrasse 28, D-10785 Berlin

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By Mario Osava
BOA VISTA, Brazil, Feb 6 2023 – Roraima, the northernmost state of Brazil, on the border with Guyana and Venezuela, is undergoing an energy transition that points to the dilemmas and possible solutions for a safe and sustainable supply of electricity in the Amazon rainforest.

As the only state outside the national grid – the National Interconnected Electric System (SIN) – it is dependent on diesel and natural gas thermoelectric plants, which are expensive and polluting sources, that account for 79 percent of Roraima’s electric power.

The financial and environmental cost is exacerbated by the transportation of fossil fuels by truck from Manaus, the capital of the neighboring state of Amazonas, 780 kilometers from Boa Vista, the capital of Roraima.

But the people of Roraima pay one of the lowest prices for electricity in Brazil, thanks to a subsidy paid by consumers in the rest of the country.

These subsidies will cost about 2.3 billion dollars in 2023, benefiting three million people in this country of 214 million people, according to the National Electric Energy Agency regulator.

A fifth of the total goes to Roraima, which from 2001 to 2019 received electricity imported from Venezuela. This meant the state needed less subsidies while it enjoyed a degree of energy security, undermined in recent years by the deterioration of the supplier, the Guri hydroelectric plant, which stopped providing the state with energy two years before the end of the contract.

Fortunately, Roraima has natural gas from deposits in the Amazon, extracted in Silves, 200 kilometers from Manaus, to supply the Jaguatirica II thermoelectric power plant, inaugurated in February 2022, with a capacity of 141 megawatts, two thirds of the state’s demand.

Roraima thus reduced its dependence on diesel, which is more costly and more polluting.

But what several local initiatives are seeking is to replace fossil fuels with clean sources, such as solar, wind and biomass.

This is the path to sustainable energy security, says Ciro Campos, one of the heads of the Roraima Renewable Energy Forum, as a representative of the Socio-Environmental Institute (ISA), a pro-indigenous and environmental non-governmental organization.

The city government in Boa Vista, the state capital, home to two thirds of the population of Roraima, has made progress towards that goal. Solar panels cover the roofs of the city government building, municipal markets and a bus terminal, and form roofs over the parking lots of the municipal theater and the Secretariat of Public Services and the Environment.

In addition, a plant with 15,000 solar panels with the capacity to generate 5,000 kilowatts, the limit for so-called distributed generation in Brazil, was built on the outskirts of the city.

In total there are seven plants with a capacity to generate 6,700 kilowatts, in addition to 74 bus stops equipped with solar panels, some of which have been damaged by theft, lamented Thiago Amorim, the secretary of Public Services and the Environment.

In addition to the environmental objective, solar energy allows the municipality to save the equivalent of 960,000 dollars a year, funds that are used for social spending. Boa Vista describes itself as “the capital of early childhood” and has won national and international recognition for its programs for children.

The Renewable Energies Forum and the Roraima Indigenous Council (CIR), which promote clean sources, say the aim is to reduce the consumption of diesel, a fossil fuel transported from afar whose supply is unstable, and to avoid the construction of the Bem Querer hydroelectric plant.

The project, of which there are still no detailed studies, would dam the Branco River, Roraima’s largest water source, to form a 519-square-kilometer reservoir that would even flood part of Boa Vista. It would affect nine indigenous territories directly and others indirectly, said Edinho Macuxi, general coordinator of the CIR.

Bem Querer would have an installed capacity of 650 megawatts, three times Roraima’s total demand. It has awakened interest because it would also supply Manaus, a metropolis of 2.2 million inhabitants that lacks energy security, and could produce more electricity just as the generation of other hydroelectric plants in the Amazon region is declining.

Almost all of Roraima is in the northern hemisphere, and the rainiest season runs from April to September, when water levels run low in the rest of the Amazon region. The state’s hydroelectricity would therefore be complementary to the entire Brazilian portion of the rainforest.

That is why Bem Querer is a project inextricably connected to the construction of the transmission line between Manaus and Boa Vista, already ready to start, which would integrate Roraima with the national grid, enabling it to import or export electricity.

“We can connect, but we reject dependency, we want a safe and autonomous energy model. We will have ten years to find economically and politically viable solutions,” said Ciro Campos.

By Mariela Jara
LIMA, Feb 6 2023 – Latin America and the Caribbean is no longer a young region and it will be one of the regions with the largest aging populations by 2050, which poses great challenges due to the social inequalities the countries face, but also opportunities to overcome them.

“Currently in the region an estimated 8.1 percent of the population is over 65 years of age, and this percentage is projected to increase to 17 percent by 2050, higher than the global average,” said Sabrina Juran, a regional technical advisor on population and development for Latin America and the Caribbean of the United Nations Population Fund (UNFPA).

In 2022, the region was home to 658 million people, of whom some 52 million were older adults, creating great challenges for the countries in terms of work, health and pensions, in a context in which according to international organizations the economic slowdown will deepen in the region in 2023.

“I am 65 and employers already saw me as too old to hire at 35, and I did not manage to get another job as a nurse technician,” says Nelly García, who moved to the capital, Lima, with her parents when she was 10 years old from her hometown of Huancayo, a city in Peru’s central Andes highlands.

The case of García illustrates the labor problems faced by many older adults in Latin America, especially women whose job opportunities are often hindered by motherhood and their responsibilities to care for family members.

“Imagine at this age what chance of insurance or pensions exist for people like me or people who are even older and work in the informal sector,” she told IPS with bitterness, adding that “if the government does not care about children, it cares about us even less. They must think ‘let these old people die because they’re no good for anything anymore’.”

García lives in Breña, a working-class district of 75,000 people that is one of the 43 districts in the department of Lima. Since she failed to find work in any hospital 30 years ago, she has been selling flowers.

She had taken a break from her work as a nurse technician to raise her four children. When she sought to return to her profession, the doors of the hospitals slammed shut on her. “I was already seen as old at the age of 35,” she repeated several times.

She has social health insurance from her husband, who is about to retire from a book import company. “But his pension will be less than 200 soles (52 dollars); that will not even cover the electricity bill,” she lamented.

Peru, a South American country of 33 million people, is facing a severe economic, political and social crisis, with a poverty level that climbed during the pandemic to a national average of 30 percent, although in rural areas it is 45 percent.

There are more than four million people over 60 according to official figures, only one third or 35 percent of whom were in a pension system. And although 89 percent have access to public health insurance, coverage and quality do not go hand in hand

“I try to save up for when I’m older, although the truth is I don’t think I’ll reach the age of 75 because in my family we suffer from heart disease. But I’m not going back to the public health insurance system,” García said emphatically.

She talked about her experience of the system: “It’s an ordeal, you have to go to the hospital at dawn to make an appointment, they order tests for several months later and who knows when you’ll get the results back. If I go through the same thing now, I’ll surely die before they call me, so when it’s my time, I hope to leave in peace.”

García is referring to the Social Health Security, a public system that covers 35 percent of people over 60, which draws harsh criticism for its poor facilities, shortage of medical personnel and poor quality of care.

A group of Peruvian women take part in a demonstration for the rights of the elderly in Lima. Latin America and the Caribbean will become one of the regions with the most aging populations by 2050 due to advances in medicine and the decrease in the birth rate. Life expectancy at birth was 72 years in 2022. CREDIT: Wálter Hupiú/IPS

An irreversible path

On Jan. 12, the Division for Inclusive Social Development of the United Nations Department of Economic and Social Affairs (DESA) presented the World Social Report on demographic change, which ratifies the global tendency that the population over 65 is growing faster than younger age sets and that people are living longer.

Greater life expectancy at birth due to the advancement of medicine and the decline in the fertility rate, which stands at 2.1 births per woman, are factors contributing to this trend.

Sabrina Juran of UNFPA told IPS from Panama City, where the U.N. agency’s regional headquarters is located, that the birth rate in Latin America is 1.85 and regional population growth is below 0.67 percent per year, both of which are lower than the global rates.

She said that according to the latest U.N. projections, there would be around 695.5 million inhabitants in the region in 2030 with a peak of 751.9 in mid-2050, after which the population would constantly decrease until reaching 649.2 million in 2100.

Sabrina Juran, a regional technical advisor on population and development for Latin America and the Caribbean of the United Nations Population Fund (UNFPA), poses for a picture at the organization’s headquarters in Panama. By 2050, 17 percent of the regional population will be over 65, the agency projects. CREDIT: UNFPA LAC

Juran explained that further reductions in mortality are expected to lead to a global average longevity of about 77.2 years in 2050 and 80.6 years regionally. Life expectancy at birth in Latin America and the Caribbean was 72.2 years in 2022, three years less than life expectancy in 2019 due to the impact of the COVID-19 pandemic.

This scenario means governments in the region must focus on meeting greater demands for healthcare, employment, housing, and pensions.

Juran said the growth of the working-age population – from 38.7 percent in 1990 to 51 percent today – can help boost per capita economic growth, known as the “demographic dividend”, which offers to maximize the potential benefits of a favorable age distribution.

“But this increase in the working-age population will not remain constant: it will peak in 2040 at 53.8 percent before decreasing,” she said. “This means there is a window of opportunity to be taken advantage of.”

The region faces steep inequalities. According to the U.N. Food and Agriculture Organization (FAO) on Jan. 18, 22.5 percent of the population – in other words, at least 131.3 million people – were unable to afford a healthy diet.

“Countries must invest in the development of their human capital, guaranteeing access to healthcare, quality education at all ages, and promoting opportunities for productive employment and decent work,” Juran remarked.

She added that they must take measures to adapt public programs to the growing number of older people, establishing universal healthcare and long-term care systems, and improving the sustainability of social security and pension systems.

“At UNFPA we advocate measuring and anticipating demographic changes in order to be better prepared for the consequences that arise,” said the regional advisor.

She said the commitment is “to a world where people have the power to make informed decisions about whether and when to have children, exercise their rights and responsibilities, navigate risks and become the foundation of more inclusive, adaptable and sustainable societies.”

Achieving this demographic resilience, Juran said, starts with a commitment to count not only the number of people, but also their opportunities for advancement and the barriers that stand in their way, which requires transforming discriminatory norms that hold back individuals and societies.

By Joyce Chimbi
UNITED NATIONS & NAIROBI, Feb 6 2023 – It is a race against time to form a new global partnership to secure a better future for the world’s poorest and most vulnerable nations by 2030 in line with the UN’s SDGs. All 46 countries classified as Least Developed Countries (LDCs) are pressed for time in a bid to deliver critical development goals.

Sub-Saharan Africa has the biggest regional presence within the LDCs group. Countries in other regions include Afghanistan, Haiti and Bangladesh. All battling a common enemy and in dire, urgent need of a concerted global push to accelerate social, economic and environmental development.

With the  Istanbul Programme of Action for the Least Developed Countries  (IPoA) implementation period completed, a new conference is being held in two parts. The first part of the Fifth UN Conference on the Least Developed Countries (LDC5) led to the adoption of the Doha Programme of Action (DPoA) in New York on March 17, 2022.

Sheikha Alya Ahmed S. Al-Thani. Credit: Twitter

The Permanent Representative of Qatar to the UN, Sheikha Alya Ahmed S. Al-Thani, told IPS that the second part of the conference will be held in Doha, Qatar, on March 5-9, 2023 and is “a unique opportunity for the LDCs, development partners, major groups, and other stakeholders to come together and build momentum for effective implementation of the Doha Programme of Action (2021-2030) and to make concrete commitments that will strengthen global and inclusive partnerships to meet the special needs of the LDCs.”

She further stressed that the conference is “a key moment for the international community to advance true development and recovery that works for all people and all countries and, therefore, reinvigorate global solidarity towards the LDCs. The State of Qatar has a proven track record of responding to the needs and challenges of the LDCs, and it will spare no effort to ensure the success of the Fifth United Nations Conference on the Least Developed Countries.”

With an estimated combined population of 880 million people, translating to 12 percent of the world population, these countries are suffocating under severe structural impediments to growth. At varying levels, all 46 countries are characterized by issues such as poorly developed institutions, low saving rates, low literacy and school enrollment rates.

“I have heard it again and again that – to leave no one behind, we must start with that furthest behind – and for this aspiration to become a reality, the Doha Programme of Action for LDCs offers an excellent package. We all need to work together, to implement this programme of action – the LDCs, their partners and or friends and the UN system,” Rabab Fatima, UN Under-Secretary-General and High Representative for the LDCs, LLDCs (Landlocked Developing Countries) and SIDs (Small Island Developing States) told IPS.

Rabab Fatima, UN Under-Secretary-General and High Representative for the LDCs, LLDCs (Landlocked Developing Countries) and SIDs (Small Island Developing States). Credit: UN

LDC5 is, therefore, a critical once-in-a-decade opportunity to accelerate sustainable development in the places where international assistance is needed the most – and to tap the full potential of the least developed countries, helping them make progress on the road to prosperity.

As such, world leaders will gather with the private sector, civil society, parliamentarians, and young people to advance new ideas, raise new pledges of support, and spur delivery on agreed commitments, through the Doha Programme of Action. It is expected that leaders will also adopt a new Doha declaration.

“The Doha Programme of Action provides a blueprint for LDCs to overcome the impacts of ongoing global crises, to build sustainable and inclusive recovery from the pandemic, and to build resilience against future shocks – to get us back on track on the 2030 Agenda. This can only be fulfilled by strengthening our partnerships through South-South and Triangular cooperation,” Csaba Kőrösi, President of the UN General Assembly, told IPS.

DPoA is defined by six key focus areas, including investing in people, eradicating poverty and building capacity, supporting structural transformation as a driver of prosperity, enhancing international trade and regional integration, leveraging the power of science, technology and innovation, tackling climate change, COVID-19 and building resilience as well as mobilizing international partnerships for sustainable graduation.

Csaba Kőrösi, President of the UN General Assembly. Credit: UN Photo/Eskinder Debebe

It is firmly believed that the full implementation of DPoA will help the LDCs to address the ongoing COVID-19 pandemic as well as the resulting negative socio-economic impacts, return to a pathway to achieve the SDGs, address climate change challenges, and makes strides towards sustainable and irreversible graduation.

Therefore, during the second part of the conference in Doha, it is expected that specific initiatives and concrete deliverables will be announced that will address LDC-specific challenges. Gathered leaders will undertake a comprehensive appraisal of the implementation of the Istanbul PoA.

Leaders will also mobilize additional international support measures and action in favour of LDCs and agree on a renewed partnership between LDCs and their development partners to overcome structural challenges, eradicate poverty, achieve internationally agreed development goals and enable graduation from the LDC category.

The heart of the conference is hence the recognition that global recovery is heavily dependent on extending much-needed support to LCDs. And that bold investments across all key sectors – particularly health, education and social protection systems – must be alive to the special development needs of the poorest, most vulnerable nations.

In all, the Office of the High Representative for Least Developed Countries, Landlocked Developing Countries and Small Island Developing States (OHRLLS) is the UN’s focal point for LDC5 Conference preparations.

The High Representative for Least Developed Countries will be the Secretary-General of the Conference. OHRLLS and the LDC Group have expressed their gratitude for Qatar, Turkey and Finland’s generous support to LDC5 preparations and welcome the contribution of all stakeholders for the success of the conference. – Additional Reporting: Naureen Hossain

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By Kate Lappin and Anis Chowdhury
MELBOURNE and SYDNEY , Feb 6 2023 – Australia is set to become the first country or jurisdiction to require large multinational corporations (MNCs), with a global consolidated income of at least AU$1 billion, to publicly report country-by-country (CbC) tax information. The new Labor Government announced on 25 October, 2022 in its budget paper that MNC’s public CbC tax reporting will begin from 1 July, 2023. Australia’s public CbC reporting rules will apply to all companies headquartered in Australia and companies headquartered elsewhere with sufficient nexus in the country.

Kate Lappin

The announcement received very little media attention, perhaps overlooked as a technical amendment. Yet public CbC reporting could be a vital weapon in the fight against corporate tax avoidance in Australia and, more importantly, in low-income and highly indebted countries that lose even greater proportions of public revenue to tax havens.

All countries in the Organisation for Economic Cooperation and Development (OECD), including Australia and the US, have required large MNCs to privately report CbC tax data under Action 13 of the OECD/G20 project against Base Erosion and Profit Shifting (BEPS). In November 2022, the European Parliament approved a directive to mandate public CbC reporting for large MNCs within the bloc, with a range of limitations discussed below, from 22 June, 2024.

The Australian move comes a month before a new push at the United Nations to convene a global tax body to set international taxation standards, after years of faltering efforts among the world’s richest countries at the OECD.

Losing billions
The Paradise Papers and the Luxembourg Leaks of the International Consortium of Investigative Journalism (ICIJ) shed light on tax manoeuvres of more than 100 MNCs. Apple alone shifted profits around the world to accumulate US$252 billion offshore. A 2021 ICIJ study revealed that, in one year alone, MNCs shifted US$1 trillion offshore, depriving governments of hundreds of billions in revenue.

Anis Chowdhury

Corporate profit shifting, as the practice is called, to dodge tax, costs countries US$500 billion to US$650 billion in lost tax revenue annually, according to a report by a high-level United Nations panel, published in 2021.

Research by the Centre for International Corporate Tax Accountability and Research uncovered tax dodging by MNCs that bled money from public services and workers including in scandal ridden aged care homes in Australia. It exposed how Microsoft receives billions in outsourced government IT Contracts, while lodging over AU$2billion in profits via its Bermuda based subsidiaries where it pays little tax.

Almost 800 large corporations paid no tax in 2020-21, Australian Taxation Office report reveals. The country loses about AU$8 billion a year due to MNCs profit-shifting.

Poor countries bleed most
The 2021 ICIJ study finds African countries the most “vulnerable” to profit-shifting. In 2017, the Tax Justice Network found that low-income countries were the biggest victims of profit shifting.

In some countries such as Zambia and Argentina, losses exceeded 4% of GDP. In Pakistan the losses due to profit shifting were 40% of total tax revenues, and in Chad, the estimated losses were larger than all taxes collected (106.2% of total tax revenue)!

The State of Tax Justice 2021 finds that low-income countries collectively lose the equivalent of 48% of their public health budgets.

Low-income countries rely more heavily on corporate income tax for the revenue required to fund cash-starved public services, making corporate tax transparency vital in addressing global poverty and inequality.

Rich countries serving corporate interests
International taxation rules have been designed by rich nations, especially by their club, OECD. Tax justice activists, such as the African Tax Administration Forum allege that developing countries are “not at the table” at the OECD, but on the menu, with OECD rules designed to allow multinationals to continue to extract profits in the global south, without making fair contributions.

The OECD’s standards for MNCs tax reporting are riddled with loopholes. As Oxfam points out, the OECD rules do not allow people in low-countries to have access to information about MNCs’ profit made or tax paid in their countries and nor do most tax authorities in low-income countries.

Similarly, the European Union’s CbC reporting is seriously watered-down. Tax transparency is only required for the 27 EU member states and the 21 black-listed or grey-listed jurisdictions on their flawed list of tax havens. Oxfam points out this means secrecy is retained for more than 75% of the world’s nearly 200 countries. The EU also provide a “corporate-get-out-clause” for “commercially sensitive information” for 5 years; and limit reporting to companies with consolidated turnover above EUR 750 million, excluding 85 – 90% of MNCs.

Unions’ play a critical role
The Labour movement has taken on the fight to end corporate tax avoidance. Labour’s share in GDP has been declining since the early 1970s in advanced countries and since the early 1980s in developing countries. Some unions have recognised that corporate tax avoidance erodes the public services workers need and undermines collective bargaining, while increasing corporate power.

The global union federation, Public Services International (PSI), co-ordinated union action to in support of public CbC reporting amongst other tax reforms. PSI joined the technical committee that drafted new Global Reporting Initiative (GRI) Tax Standards and worked with union pension funds to back the standards, which are now widely regarded as the best benchmark for corporate tax accountability.

In Australia PSI and affiliates exposed corporate tax avoidance in aged care, labour hire companies and corporations receiving large government contracts and worked with unions to shape the Labor party’s policy platform.

The announcement reflects one of the recommendations PSI and the International Trade Union Congress made to the Australian Treasury in its submission on Multinational Tax integrity and enhanced tax transparency.

Can Australia lead?
Since being elected in May 2022, the new Australian government has sought to improve its international standing by setting stronger climate targets, increasing engagement with Pacific Island countries and rebuilding capacities of the Department of Foreign Affairs and Trade. If the government can make good on its promise to implement the GRI standards and require public CbC reporting, it will have significantly contributed to the global public good and set a precedent for the EU and other countries to follow.

In addition to setting new tax transparencies standards, the Albanese Government should support the push by African countries for a truly inclusive UN tax convention – which could slash the scope for tax abuse by MNCs and wealthy individuals. Together, these contributions would deliver more to low-income countries than Australia’s entire development aid budget.

Kate Lappin is the Asia Pacific Regional Secretary for Public Services International (PSI), the Global Union Federation representing more than 30 million workers who deliver public services in 154 countries and territories. Kate headed the Asia Pacific forum on Women, Law and Development (APWLD) for eight years and has worked across labour, feminist and human rights movements for more than 20 years.

Anis Chowdhury is Adjunct Professor, Western Sydney University. He served as Director of Macroeconomic Policy & Development and Statistics Divisions of UN-ESCAP (Bangkok) and Chief, Financing for Development Office of UN-DESA (New York).

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