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“The Baby trade is likely to continue to grow, partly it is no longer simply a response to wars and humanitarian crises. For better or worse, it now behaves much like a commodities market, with demand informing supply; and neither demand nor supply is likely to subside.” – Ethan Kapstein 2003
Since Madonna and Angelina Jolie famously adopted children from Africa, the international adoption system is under fire. The suspicion is that the system may be driven by market forces and profit seeking, and that regulations and international conventions just camouflage (illegal) market practices and facilitate the trafficking of children. Clearly, international adoptions are serious normative and political issues for the “sending” countries because children are normally understood as “sacred” and are loaded “with sentimental or religious meaning” (Zelizer 1985: 11). They should be protected, educated and loved.
The international dispersion of these ideas is reflected in the UN Convention on the Rights of the Child (UNCRC), which has been signed by 193 countries until now, who
proclaimed that childhood is entitled to special care and assistance … [children] should grow up in a family environment, in an atmosphere of happiness, love and understanding … in particular in the spirit of peace, dignity, tolerance, freedom, equality and solidarity.
Extra commercium
The idea of child protection clearly reserves them “a separate noncommercial place, extra-commercium” (Zelizer, ibid.). However, although it is prohibited, child trafficking is still a worldwide phenomenon. Usually it takes place between “Third World” countries and the industrialized western world, and it appears in different forms. Especially the practice of “child laundering” has gained high attention. Read the rest of this entry »
Why should Africa adopt IFRSs? Adoption is less of the story.. not practicing what you preach is the bigger evil.
In the past decade the rise in the use of the International Financial Reporting Standards (IFRS) in many countries around the world has moved the wave towards developing countries considering adopting these standards. Factually, about 120 countries presently use IFRS across the globe. Out of this number about 13 countries in Africa have already adopted (i.e as issued by the IASB without any modification) or adapted (.i.e with modification to meet local socio-economic needs of a particular accounting jurisdiction) to IFRS.
A diverse Continent a uniform accounting standard? Primarily, former Anglo-Saxon colonies have adopted IFRSs.
(Source: Data from PwC IFRS map, Own drawings)
However, it is quite surprising that Africa as whole is considering adopting IFRS given the chaotic nature of these standards on the international front and the often unseen justification given for the adoption of IFRS particularly in Africa. Many international organizations like the World Bank , the World Trade Organization , USAID and UNCTAD have all been arguing for the adoption of IFRS in less developed countries . There are many reasons why Africa should not adopt IFRS. I will try to explain and to some extent justify this line of reasoning.
Politics over Economics
First, the merits of IFRS often mentioned include, improved comparability and uniformity of financial statements among companies and countries, resulting in a decrease in the equity cost of capital, improved transparency, a decline in information processing cost and a reduction in risk of international investment decisions amongst others. Whilst these benefits look very desirable, it is also the case that these benefits cannot be reached in every economy.
To be clear, IFRSs were designed for developed and matured capital markets. At least the economics speaks for itself. It is an undeniable fact that financial statements assist investors in making critical investment decisions. As pointed out in the general purpose of financial statements in the conceptual framework of the IASB, financial statements should aid users in valuing securities, be it when buying or when selling.
The argument for the use of IFRSs in developed countries in plausible. However, what I find puzzling is the push for IFRS adoption even in countries that have no stock markets or stock market listed companies. I do not deny that quality financial reporting should be present in economies where there are no capital markets. But I also admit that such countries have totally different financial reporting needs than industrialized countries. Accounting systems of a country are traditionally shaped by its socio- economic, cultural and political environment. Some economies are totally different from others and therefore we must recognize that these differences in accounting needs shape financial reporting.
The diamond trade hasn’t exactly enjoyed a great reputation over the past years. Not least thanks to Hollywood movies like Blood Diamond, these gems are inextricably percieved as covered with the blood spilt in civil wars all over Africa.
But diamonds are also a key export of many poor African nations.
Despite some initial progress being achieved by the Kimberly Process certification scheme, diamonds’ persisting bloody reputation isn’t exactly undeserved. Many still find their way into the world market, dominated by De Beers, from appalling sources.
Groups like Amnesty International and One Sky have criticised the certification scheme as lacking impartial, obligatory monitoring. Global Witness, an NGO specialising on the link between natural resource exploitation and violence reported the scheme to be failing to address issues of non-compliance, smuggling, money laundering and human rights: “The clock is running out on Kimberley Process credibility.”
Other problems include that diamonds from conflict-ridden Zimbabwe are still considered legitimate under the Kimberly Process; and the mind boggles as to what real effects membership of countries like the Democratic Republic of Congo may have on the ground. Several civil wars currently rage within the Congo’s boundaries.
governancexborders.com 