The Role of Multinational Corporations in Conflict in Sierra Leone - Research Paper Example

The Role of Multinational Corporations in Conflict in Sierra Leone - Research Design Introduction Natural resources have been a very critical source of national wealth and pride since the beginning of regionalization and the pre-colonization era. Nations and civilizations alike have gone to war-both internally and externally-for the sole occupation over and exploitation of natural resources. Under the modern globalized trading environment, countries endowed with natural resources ranging from minerals, oil, wildlife, gas and so forth have been able to accrue revenues from exploration and trade of said minerals with other countries of the world. Foreign exchange earned from the legitimate trade in the resources has been a critical drive for economic development providing employment and revenues to governments for the provision of essential public services including education, infrastructure and national security. Another significant impact of the globalization of trade and production, as well as the relative ease of mobility of capital compared to labor, is the emergence of business entities that are operated across borders, regions and continents but have a central office at the homeland from where all its global management is conducted. Such entities are often referred to as multinational or transnational corporations or enterprises [Glo]. Such global-often private-firms and international institutions are presently observed to be primary actors and vital agents for the transformation of the state, region and international political, social and economic environment. The question, therefore, is; how do MNCs develop ties with government, if such ties exist at all? In an ever increasing competitive landscape, countries of all levels of development-particularly through their governments-are emphasizing policies and channeling resources into new ways of attracting foreign direct investments into their countries. This is in accordance with the high prioritization of both micro and macroeconomic goals including sustained high levels of economic growth, stability of inflation and foreign exchange, increased employment and improved living standards of the population. MNCs play an important role in the efficiency and growth of the economy. This it achieves by contributing to the availability of capital resources for global investment purposes [Hel]. Sierra Leone is located at the south-western part of West Africa between the seventh and tenth latitudinal parallels north of the Equator. It has a land mass measuring approximately 71,740 square kilometers and a total coastline of 402 kilometers [www125]. It is most difficult to measure the exact population in Sierra Leone due to the long and deadly civil war that mushroomed since 1991. However, the total population was estimated in 2000 to be around 5.2 million [www125]. A large part of this population is of African descent consisting of approximately 18 different native African ethnic groups. Sierra Leone’s gross domestic product estimated at purchasing power parity in 2000 was approximated at $2.7 billion greatly influenced by its chief exports including diamonds, fish, rutile, cocoa and coffee. Sierra Leone has been a major producer of diamond for almost a decade. Diamonds are believed to have been discovered in 1930 in the Kono and Kenema Districts especially along the Sewa River and the Koidu and Tongo fields [Dov12]. Majority of the locals involved in the diamond mining lack ownership over the diamonds they are extracting as ‘tributors’ or non-wage laborers [KMP05]. Legitimate diamond production in Sierra Leone was approximated at 600,000 carats in 1999, 2000, and 2001 with most production by artisanal miners [Dov12]. From the onset, there were semblances of challenges to come related to its exploitation. For almost a quarter century, the exploration was conducted exclusively by the Consolidated African Selection Trust who remitted to the government a paltry 27.5% of its annual net profit. This, coupled by the easy availability of gems closer to the surface, encouraged the birth of early illegal mining and exporting that the government was forced to renegotiate its terms with the sole miner in 1955. Further reforms have been done by the government subsequent to this, including, the setting up of the Alluvial Diamond Mining Scheme in 1956; the setting up of the Government Diamond Buying Office in 1985 and the later attempts to return diamond exportation activities to private firms in a bid to maximize returns and curb illicit mining and exportation in 1991. Soon after, Sierra Leone plunged into bloody civil war that stretched from 1991 to 2002. Sierra Leone’s diamond exports would be infamously during this period and henceforth gain the tainted name of “blood diamonds” associating it to the massive loss of lives that were perpetuated by the rebel militia, the Revolutionary United Front (RUF) and the South African Executive Outcomes mercenaries [KMP05]. This research, therefore, aims to evaluate-specifically-how the actions and/or operations of multinational corporations particularly within the international diamond trade served to influence the conflict. It will examine how the corporates took advantage of the lapsed structures of governance and at times, deliberately in cohort with other active organs, funded and sustained the links between the slave and murder zones, that is, Sierra Leone’s mineral regions and the largely European market. Additionally, it will purpose shed light on how such extractive sector firms and in particular multinational corporations can commit to greater standards of good governance. Research objectives 1. To examine the role of multinational corporations in the growth and development of diamond-and by extension natural resource-industry in Sierra Leone 2. To examine the role of multinational corporations in the conflict in, Sierra Leone between 1991-2002 Research hypothesis Multinational Corporations have a participatory and perpetuating role in the conflicts within mineral rich regions of the world such as Sierra Leone Research questions 1. What is the role of multinational corporations in Sierra Leone’s diamond industry? 2. What roles did the multinationals operating within Sierra Leone play in regard to its extended civil conflict of 1991-2002? Theoretical framework The approach of this research would be centered on Karl Marx’s conflict theory. The conflict approach emphasizes a materialistic interpretation of historical events. It begins with the assertion that the most dominant determinant of social life is employment; employment that will particularly determine the possibility and capability of meeting basic needs of society such as food, shelter and clothing. Karl Marx believed that everything of value to society originates from human labor. This is because the fair reward for effort, time and skill or expertise influenced heavily the direction and supply of human resources (capital) subsequently influencing the development and differentiation of classes within the society. This theory, therefore, suggests that any disproportionate distribution in any of these inherent elements of societal classes is a potent source for conflicts in any nation. Secondly, the conflict theory was further subdivided into stages; the most essential being feudalism, capitalism and socialism. Capitalism as aforementioned was the dominant economic theory of the 19th and 20th century. According to the conflict theory, the core institution of the model was the policy of private property. This system intentionally influences the distribution of capital in production activities by concentrating into the hands of relatively fewer members of the society. It leads to the emergence of two classes: bourgeoisie or the owners of the capital and the proletariat or the workers. These classes are in opposition with the former wanting to make more profits through less payment to the latter for their labor and time. This effectively leads to exploitation of the larger lesser class economically. As such, the theory further postulates that economic oppression directly leads to political oppression as the owner of the capital try to influence and take over policy making within the state to make it servant to the economic interests of the bourgeoisie. Where there is a fusion of capital power and policy-making power, through deliberate influence or through a disintegration of governance systems, as is the case in excessively corrupt states, the potentiality of societal conflicts is quite rife due to heightened class struggle. Research Methodology The research would make strong use of secondary data. The reason for this choice of data is influenced due to practical considerations of time, cost and the relative ease with which such data are available [Jud05]. The sources of secondary data would include a wide array of print sources including but not limited to reports especially by commissions of inquiry into the civil war of Sierra Leone such as those by the United Nations, journals, periodicals and relevant books. Additionally, materials based on other civil wars related to natural resources especially within the African region will be computed to create a scope from which the researchers can enrich the arguments and interrogate the hypotheses. The risk inherent with this type of data and its sources include the lack of conduction of further research on the matter; thereby accepting the findings of the sources as empirical during the compiling of a report on the research topic. Similarly, the virtual unlimited nature of secondary sources means that the researcher cannot conclusively include all findings by other authors and researchers due to inability to capture and read on all their works as well as the limited duration of time with which to conduct the overall research and compile a report. In overcoming this risk, the researcher shall be confined within the scope as outlined by the research title hence only retrieving data that relate directly to the underscored subjects. Secondly, the use of peer reviewed sources will help increase the credibility of current findings as the validity of sources is not in question but purely considered as empirical. Works Cited Glo: , (Garry and Litan 75), Hel: , (Held and McGrew 111), www125: , (www.nationsencyclopedia.com), Dov12: , (Dove Diamonds & Mining Inc.), KMP05: , (Powlick 30), KMP05: , (Powlick 31-35), Jud05: , (Bell 52), Read More