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At the UN, Speeches While Gaza Stays Lightless and Insurance Not Yet Paid

Byline: Matthew Russell Lee at the UN

UNITED NATIONS, July 21 -- In the midst of forty-some speeches on the Security Council floor, questions were asked and partially answered concerning the Gaza power plant which was bombed and transformers destroyed three weeks ago. According to UN envoy Alvaro de Soto, the plant will take up to a year to rebuild. In the meantime Israel has resumed allowing gas into Gaza through the Nahal Oz pipeline "at the rate deemed to be the minimum... but it doesn't solve the problem" of trying to run hospital and sewage systems on backup generators. Video here, at Minute 16 through 18.

Palestine Electric Company smoldering

            At a post-Gaza, pre-Lebanon bombing briefing, UN humanitarian chief Jan Egeland mentioned that the plant was "insured by an American insurance company" which might not pay, due to the sanctions on the Hamas government.  Following that briefing, Inner City Press' inquiries in Gaza found that the insurer is the U.S. government's Overseas Private Investment Corporation, OPIC, and that the plant is one-third owned by the Connecticut-based Morganti, successor to Enron's interest in the plant.  On Friday Inner City Press asked Jan Egeland if he had any update on the plant being rebuilt, and on power plants in Lebanon.  Mr. Egeland answered that it is still "not clear who will pay and how," and that the current situation includes "most people in Gaza, in the blistering heat of summer, spending most of their time without electricity or water." Video here, at Minute 29 through 31. Mr. Egeland described this as a clear violation of humanitarian law, adding that he is not a lawyer. (Similar, Alvaro de Soto said, "We are in the good offices business, not the legal industry.")

            OPIC's $48 million insurance policy is for the one-third of the Gaza power plant that is owned by Morganti. Further inquiries by Inner City Press have found that while U.S.-based, Morganti is controlled by Palestine-born businessman Said Khoury. One surmises that Mr. Khoury would not take the insurance proceeds, assuming they are received, and not try to rebuild the power plant. But as Mr. Egeland said Friday, all six of the plant's six transformers were destroyed, and four were manufactured to specifications by Sweden-based ABB. While a call for contributions to the humanitarian situation in Lebanon will be announced Monday, it will be months before normal power is restored in Gaza, and now in Lebanon, given the destruction of such power plants as that at Jiyeh.

            On a parallel track, Iran has for now been offered an $800 million nuclear power plant in exchange for committing to no nuclear weapons.  Many at the UN, particularly after seeing Condoleeza Rice's Washington remarks on Friday afternoon, now suspect that the U.S. may try to link the Lebanese and Iranian questions. Asserting Iran's support to Hezbollah, the attempt may be to require action on Iran as part of the "comprehensive solution" now being alluded to. 

   At the UN, at least among the press corps, frustration began to mount that after being away for weeks, Kofi Annan has yet to take any questions, but will reportedly appear Friday night on Larry King Live. Carefully scripted Kofi?  Many speeches but little information.

            Meanwhile in other, largely ignored world news, it is reported that Ethiopian troops have crossed into Somalia, to confront Islamic Courts.  Since the UN is "seized of the matter," as they say, and the Secretary-General has a special envoy covering Somalia, at Friday's noon briefing Inner City Press asked for information and comment on the incursion.  "We have seen the media reports," spokeswoman Marie Okabe said, "but we are unable to confirm them. The Secretary-General urges all nations to respect the territorial integrity of Somalia." Video here, from 9:23. It's said that UN envoy Francois Lonseny Fall is following events closely. We'll see. Friday afternoon in the stakeout's lull, Inner City Press asked Security Council presidential staff about Somalia and the reported incursion by Ethiopia. "It's just that, reported," the staffer said. "We have no confirmation." There's this AP story, reported from Mogadishu and Nairobi. No reporters in Baidoa? Developing...

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At the UN Poorest Nations Discussed, Disgust at DRC Short Shrift, Future UN Justice?

Byline: Matthew Russell Lee at the U.N.

UNITED NATIONS, July 20 -- The plight of the 50 least developed countries on Earth was the topic of discussion Thursday at the UN, at the margins of dueling stakeouts between the Ambassadors of the U.S. and Lebanon, Israel, Peru and Kofi Annan's band of three envoys to the Middle East.

  In from the Palais des Nations in Geneva, the UN's Charles Gore spoke with passion and at length about how countries in Africa are now inundated with food exported by more developed countries which subsidize its production and export.

  While not responding directly to Inner City Press' request for his analysis of the World Trade Organization regime and protectionism and subsidies by Europe and the U.S., Mr. Gore noted that fully 47% of aid actually transfers capital to the beneficiary nation. For the U.S.'s aid, said Mr. Gore, only 10% involves capital transfer. The rest is debt cancellation, emergency and food aid and "technical assistance," which is often just a transfer to the donor nation's own technocrats, as Ugandans have complained of the UNDP's aid.

Afghan Herat per UNHCR

          The reported increase in aid is largest attributable, Mr. Gore said, to Afghanistan and the Democratic Republic of the Congo, DRC. Out on the second story's main floor, the DRC and its looting for resources for armed insurgent groups was on the Security Council's agenda. Due to the Lebanese crisis and briefing by Kofi Annan, the DRC agenda was by all accounts rushed through. A three page draft resolution was perfunctorily dropped by the head of the sanctions committee Oswaldo de Rivero, the UN envoy from Peru.

            Amb. Rivero also came to the stakeout, to speak of Lebanon. He sounded suspiciously Boltonesque, stressing that it is impossible to negotiate a ceasefire with a terroristic group. Earlier Amb. Bolton went further, asking what a ceasefire would mean to any non-elected government. Given the number of UN member states, including U.S. allies, which are not democracies, it seemed a loaded question.

            At Amb. Rivero's stakeout, Inner City Press asked what countries were pushing-back on the proposals for a ceasefire or cessation of hostilities in Lebanon. He answered non-committally that the Council is united, at least on matters humanitarian. After the stakeout, at he re-entered the Council chamber, Inner City Press asked him why Peru had abstained from the Gaza resolution on July 13.  "Because these two are connected," Amb. Rivero answered, gesturing into the Council.

            "Gaza and Lebanon?"

            "Exactly. They have to be solved together," he said.

            "It wasn't that you thought the resolution should be directed less at Tel Aviv?"    "No, no," Amb. Rivero insisted. "It was because Lebanon had to be included. That's the only reason we abstained."

            Perhaps... Substantively on the Congo, while still awaiting straight answers, more information emerged Thursday about the UN's negotiations with Peter Karim, who parlayed the kidnapping of seven UN peacekeepers into a job as a colonel in the DCR army. Not only did Karim demand shoes, and lots of them -- he also insisted that his motorcycle be returned to him by Congolese authorities. The bike was returned. And then, Peter Karim was offered a position as colonel in the Congolese national army.

            Improvements in staff justice? Thursday afternoon there was a sparsely attended briefing by the Redesign Panel on the UN Internal Justice System. Five of the members of the Panel presented their proposal, which would they said provide faster and more professional justice. Inner City Press asked if the cases and results would be public, unlike the current system. Mary Gaudron, currently a judge for the International Labour Organization Administrative Tribunal, answered the hearings would be public as would be results, unless the judge "in the interest of justice" decided otherwise.  Inner City Press asked about some current cases; a colleague correspondent of shall we say school boyish charm asked about bringing the corrupt to justice. With questions still unasked, the briefing was brought to a close. One of yesterday's questions, however, received a one-line answer. "In response to your question from yesterday: the Deputy Secretary-General met with members of the Iraq Revenue Watch as part of his briefings to understand better the issues related to the preparation of the International Compact for Iraq." Alright, then. To be continued.

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At the UN Wordsmiths Are At Work on Zimbabwe, Kony,  Ivory Coast and Iran

Byline: Matthew Russell Lee at the U.N.

UNITED NATIONS, July 19 -- "That's what we do here, we smith words," said John Bolton, U.S. Ambassador to the UN, on Wednesday afternoon. He was referring to a draft Security Council resolution on Iranian nuclear issues, but he could just as easily have been referring to the ten days spent on the North Korea resolution that passed Saturday, or North Korea's second written response to the resolution, distributed today. Or to his own non-answers about the Lords Resistance Army:

            "President Bush is meeting Thursday with Salva Kiir, president of South Sudan. Will he be discussing the Lords Resistance Army, and what is the U.S. position on the offer of amnesty to Joseph Kony?" Question at Minute 5 of this streaming video.

            "I'm sure the President is going to cover the full range of issues and as to the specifics of what he is going to cover, I really think it is up to him and to the White House to announce."

            But the White House's summary of the upcoming meeting, which listed five issues, did not mention the LRA peace talks taking place in Juba, or that the vice president of South Sudan, Riek Machar, was photographed handing thousands of dollars to Joseph Kony, indicted for war crimes by the International Criminal Court.

Smithed words in Cote d'Ivoire

            Meanwhile in much slower smithing, the UN Development Program finally provided a response to a question one week old: why does UNDP fund Robert Mugabe's Human Rights Commission, when NGOs and the Zimbabwe Lawyers for Human Rights are boycotting it?  The answer, provided at arms length through Kofi Annan's spokesman's office, runs as follows, in full:

"Facilitating the protection and promotion of human rights and the upholding of rule of law is part of the UNDP mandate under its practice area on governance. There is an agreement between UNDP and the Office of the UN High Commissioner for Human Rights to work together on the promotion and protection of civil and political as well as socio-economic rights as state in the High Commissioner’s Action Plan. Supporting and facilitating protection of human rights can be done in various ways and UNDP has in other countries facilitated the setting up and strengthening of human rights institutions.

"UNDP is working to facilitate dialogue on human rights in Zimbabwe generally and more specifically on the proposed National Human Rights Commission, with the participation of and at the request of  Zimbabwean Civil society, as represented by NANGO, the independent governing body of non-governmental organizations in the country .

"On the National Human Rights Commission, UNDP is not a decision maker nor a participant in the debate but only a facilitator of the dialogue. UNDP is not a 'funder' of the Human Rights Commission. UNDP in its facilitation role has made financial resources available for the dialogue with civil society organizations and for the Government to be exposed to National Human Rights Commission systems of other countries in Africa through study visits (example: a recent Zimbabwean ministerial delegation under UNDP auspices to study the Kenya National Human Rights Commission).

"A request was made by Government for UNDP to play an advisory role in the Human Rights Commission and this is still being considered. UNDP believes that the decision of government to establish the National Human Rights Commission presented an opportunity for dialogue and as part of its mandate seized the opportunity to bring Government and civil society together as aptly requested by the parties themselves.  UNDP believes further  that it is part of its mandate to facilitate processes that will lead to the greater protection and promotion of human rights in the country. And in its engagement with the government and civil society, UNDP has consistently emphasized that international set standards on national human rights institutions contained in the Paris Principles must be adhered to and are the yardstick for a truly independent, effective and transparent human rights commission."

   By contrast, the article linked-to above, "Civic groups to boycott human rights conference," quotes the executive director of the Zimbabwe Lawyers for Human Rights that "groups resolved that they would not attend the meeting because they did not want to be seen as supporting the state's proposed human rights commission." The article reports that "the conference, organized in consultation with the United Nations Development Programme (UNDP), was initially scheduled for this weekend but had to be  postponed to the 14th or the 21st of this month after civic groups indicated they needed more time to study the proposals.... The spokesman of the National Association of NGOs, Farai Ngirande, said civic groups wanted the government to draft a new constitution before setting up the commission. 'We want wholesale constitutional reform. You can't talk of a human rights commission without addressing issues pertaining to freedom of expression and association,' he said."

            This last is from the same NANGO with which UNDP claims to be working "more specifically on the proposed National Human Rights Commission, with the participation of and at the request of  Zimbabwean Civil society, as represented by NANGO, the independent governing body of non-governmental organizations in the country ."  We'll have more on this UNDP wordsmithing; in the interim we note that the date this UNDP statement was provided, the Mugabe government locked up demonstrators and journalists, click here for more. Our question with UNDP is what its standards are.

    In similar cognitive dissonance news, on Wednesday the Ambassador of Syria denied his government excluded UN envoy Terje Roed-Larsen. Deputy Secretary General Mark Malloch-Brown on the other hand said Roed-Larsen was kept out, but called the matter moot since his team was returning to New York anyway. A reporter called this Orwellian and Malloch-Brown looked on bemused. The UN's write-up later diplomatically said that l'affaire Roed-Larsen "seemed to be a matter of some contention" -- more wordsmithing.  Earlier in the day at the noon briefing, Inner City Press asked about the purpose of MMB's meeting with Revenue Watch. The spokesman didn't answer, then or now by press time.

            Mr. Malloch-Brown had come down to speak in the place of the long-traveling Kofi Annan. Wednesday at the noon briefing, Inner City Press asked if Mr. Annan had made any statement about the North Korean missile tests, or had placed a call to North Korean leaders. "No," was the answer. He's spoke with the president of Sudan. Why not North Korea?

            A statement was distributed Wednesday to the press. In it North Korea, which Saturday used the pithy term gangster-like, became slightly more diplomatic, stating that "It is entirely unreasonable and brigandish act that the U.S. brought to the UN the DPRK's missile launch nothing contradictory to any international law after branding them as a violation." It might not made sense, but the word brigand is a thesaurus greatest hit. The DPRK statement ends, "We will firmly defend our own way the ideology and system chosen by our people, true to the Songun policy, a treasured sword."  Say what?  Many thought "gangster-like" worked better.

            Something, however, was accomplished. Or at least a Presidential Statement issued. It concerns Ivory Coast, and it states in part that the

"Council underlines that it is fully prepared to impose targeted measures against persons to be designated by the Committee established by paragraph 14 of resolution 1572 (2004) who are determined to be, among other things, blocking the implementation of the peace process, including by attacking or obstructing the action of the United Nations Operation in Côte d’Ivoire (UNOCI), of the French forces which support it, of the High Representative for the elections or of the IWG, responsible for serious violations of human rights and international law committed in Côte d’Ivoire since 19 September 2002, inciting publicly hatred and violence or in violation of the arms embargo, as provided in resolutions 1572 (2004) and 1643 (2005)."

            As supporters of president-in-overtime Gbagbo disrupt the identification process that must precede election, it's worth noting that a step yet to be taking on the Cote D'Ivoire arms embargo is an audit of revenues related to cocoa. There's also a still-handing issue about untaxed black market cocoa, which we wordsmiths here are Inner City Press are calling "Conflict Chocolate." More on that to follow.

UN Stasis as World Unravels Gives Space to Ivory Coast's Gbagbo and Others

Byline: Matthew Russell Lee at the U.N.

UNITED NATIONS, July 14 -- The world, it is reported here and elsewhere, is unraveling. And as the UN Security Council remains this Friday night on hold, canceling a meeting scheduled for 5 pm so that the Permanent Five Plus Japan can meet at the U.S. mission, in the wider world there are grabs to take or cling to power. In Cote D'Ivoire, for example, the process of identification for the already-postponed election now slated for October 30 was supposed to begin this week. It did not however begin.

            At the UN, Inner City Press asked the Security Council president Jean-Marc de La Sabliere about events in Ivory Coast. The French mission provides this transcript:

Inner City Press Q: On Côte d’Ivoire, the identification process has been suspended. Do you have a comment?

Amb. de La Sabliere A: "This is a great concern. What the Council has done this month is to listen and react to a briefing from Mr. Guéhenno who was in Banjul and Yamoussoukro with the Secretary General. We are now preparing a PRST to support the conclusions of the Yamoussoukro meeting where new commitments were made. We want those commitments to be implemented. The PRST will be adopted, I hope, very early next week. Next step: the GTI will meet in Abidjan on the 20th of July. The Council will meet on the 26th.

"Going back to your question: the identification is a major element of the agreement. It was agreed upon by the parties of Côte d’Ivoire that identification and disarmament would go along. So, we cannot organize elections if the identification process is not done. So, identification is important, and the Council will have to assess what happened yesterday. As French Ambassador, I can say that the PRST will take that into account.

Q2: As French Ambassador, would it be your view that if elections are not held…?

A2: "My answer is that there will be a Summit in September. We will see what happens then."

   Unless of course there are other higher profile crises in September... In the run-up to the 90 p.m. let down, at 5 p.m. the press corps assembled for a scheduled Council consultation. Then cell phones and Blackberries went off, announcing the meeting was cancelled. In the lull before the 9:40 conclusion (see above), the stakeout scuttlebutt, at least among reporters, was that the U.S. veto on Thursday emboldens China to veto the draft Chapter 7 resolution on North Korea. Also in the lull, some drifted over to stakeout the U.S. mission. Others retired to the Delegates' Lounge, where Inner City Press Friday interviewed the Permanent Observer from Palestine, Riyad Mansour, who confirmed Inner City Press' finding that the U.S. government's Overseas Private Insurance Corporation insured the Gaza power plant, since Enron built it, click here for that story.

UN's Corporate Partnerships Will Be Reviewed, While New Teaming Up with Microsoft, and UNDP Continues

Byline: Matthew Russell Lee at the U.N.

UNITED NATIONS, July 13 -- The UN under Kofi Annan has increasingly worked with corporations. Questions have been raised about background checks and safeguards. A day after Inner City Press reported that the UN's Geneva-based refugee agency had not known that Swiss banker Ivan Pictet is on the UN Investment Committee when the UNHCR Kashmir Relief Note placed money with the Pictet Funds India Equity fund, the agency's spokesman mused, "Isn't the UN Investment Fund based in New York?"

            Inner City Press asked if it would have been helpful to UNHCR if the UN system had a database of the companies controlled by the outside business people who serve on bodies like the UN Investment Committee. A Google search for that committee and Pictet found close to nothing. It appears that there is no easy way to find who is on the UN Investment Committee.

            UNHCR's Ron Redmond answered that that it would "have been helpful to have that type of information... For UNHCR to look it up is labor intensive, with all the possible company names." He later added in writing, "Any additional information on prospective corporate partners is of course always welcome; it would facilitate our screening processes." Mr. Redmond states that UNHCR was never required to ask SocGen to cease using the UNHCR visibility logo, in part because the brochure that it was on was only intended to be used for a brief period. But records show that individuals high in UN Headquarters chided UNHCR for the use of such terms as UNHCR "teams up" with SocGen. Despite this in-house chiding, or perhaps because the chiders refuse in their defensiveness to comment for the record, this practice continues in the UN system to this day, literally. Click here to view the UN's World Tourism Organization's July 12, 2006 press release, "UN tourism agency teams up with Microsoft," which was published on the UN News Center just as UNHCR SocGen-derilab's April 5, 2006 press release was. They just keep teaming up.

            As the UN increasingly has intercourse with corporations, basic safeguards are still not in place. Inner City Press has previously reported on the lack of background checks when corporations are allowed to join the UN Global Compact, and has twice been rebuffed in requests to interview or ask questions of corporate CEOs who have come to meet the Secretary General or on other Global Compact business.

            At Thursday's noon briefing, spokeswoman Marie Okabe was asked if any of the individuals in the Secretariat who were asked to comment on the UNHCR - Pictet - Societe Generale transaction had in fact spoken or provided guidance. We're still working on it, Ms. Okabe answered.

            Near six p.m., Ms. Okabe called Inner City Press and said she had spoken about the matter, as requested, with Under Secretary General Mark Malloch Brown. "They are aware of the issues," Ms. Okabe said. "This case highlights the complexities of the UN's partnerships with the private sector and so current guidelines and practices of various funds and agencies and programs will be reviewed" to try to avoid "potential conflicts of interest" and misuses of UN logos.

            Great. But what about the continued "teaming up," now with Microsoft? There's more work to be done.

[A note on UNHCR's work about Uzbekistan: the agency managed to visit in Kazakhstan with Gabdurafikh Temirbaev, the Uzbek dissident threatened with refoulement back to Tashkent, and has, its spokesman said, gotten a commitment to be able to review Uzbekistan's extradition request.]

            Alongside UNHCR's work, unlike at the UN Development Programme, at least UNHCR answered the questions and acknowledged that things could be better. On UNDP and human rights, on UNDP and refusal to answer press questions, what will happen?


            On the issues surrounding UNDP, the Office of the Spokesman for the Secretary-General managed to get some response from UNDP to a question Inner City Press asked UNDP in writing more than a week ago: why does UNDP help the government of Uzbekistan to collect taxes, given the UN Office of the High Commissioner for Human Rights' finding that this government shot and killed its own people in Andijan in May 2005. Here now is UNDP's response:

"As far as your UNDP/Uzbekistan questions from the other week, here's what I can tell you... in Uzbekistan and most of the 140 developing nations where UNDP operates, UNDP works with government and civil society on a broad range of governance projects, including economic reforms, of which tax administration and fiscal policy are a significant component. Other governance projects in Uzbekistan focus on gender equality, internet access, and public administration reform. It may be worth noting that UNDP works in a wide range of political environments, from Costa Rica to North Korea, with the belief that UNDP's mandate as a development agency is to work constructively on behalf of the people of the developing world wherever and whenever possible."

            One wag wondered if UNDP's programs in Uzbekistan might involve technical assistance on not putting political dissidents in boiling water, as the U.K.'s former ambassador in Tashkent has testified takes place. And see above, that UNHCR has managed to visit in Kazakhstan with Gabdurafikh Temirbaev, the Uzbek dissident threatened with refoulement back to Uzbekistan, where he would face torture -- perhaps with tax funds UNDP helped to collect. UNDP has still not even purported to answer the week-old question about UNDP's funding of Robert Mugabe's purported "Human Rights Council." Now the Zimbabwe Lawyers for Human Rights has called for a boycott.  What was that again, about UNDP working with civil society? To be continued.

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Conflicts of Interest in UNHCR Program with SocGen and Pictet Reveal Reform Rifts

Byline: Matthew Russell Lee at the U.N.

UNITED NATIONS, July 12, 11:45 am, updated 7 pm -- Eager to "team up" with banks Societe Generale and Pictet & Company, the United Nations' refugee agency allowed SocGen to use the UN logo in a way subsequently criticized by UN legal staff, and to invest Kashmir Relief Notes funds in a Pictet & Cie fund despite owner Ivan Pictet being a member of the UN Investment Committee. Criticized by other UN units, UNHCR agreed to cease renting out the UN logo, but said nothing can be done about the investment with Pictet et Cie.

    Inner City Press first raised these matters in April 2006. Earlier today UNHCR in Geneva finally responded, confirming but defending the investment in a Pictet fund.  UNHCR's Ron Redmond wrote to Inner City Press that

"based on the information available to us, there is no conflict of interest created for Mr. Ivan Pictet, managing partner of Pictet & Cie, and ad hoc member of the UN Investments Committee, by the fact that Pictet Funds Indian Equities is one of the funds in which KRN funds are invested. Societe Generale, the issuer of the Note, is solely responsible for choosing the funds and this selection is based on recognized risk management and hedging criteria; UNHCR plays a purely passive role as the recipient of a donation and has no interest in the performance of the Note. Moreover, Mr. Pictet's membership in the UN Investments Committee was unknown to all parties involved in drawing up this investment product, and we trust therefore that the decision to include a fund managed by Pictet & Cie was taken in good faith."

         Whether this is in keeping with current and proposed UN standards of ethics and transparency will be seen in coming days. Whether the stated lack of knowledge of Mr. Pictet's membership on the UN Investment Committee comports with minimal corporate or competence standards is also in question. The problem is a wider one: in a defensive internal memo reviewed by Inner City Press, UNHCR lawyer Helmut Buss argues that UNICEF similarly partners with FIFA and NIS Petrol Co, and that the World Food Programme does the same with TNT Airways and the World Rugby Board. Nevertheless, UNHCR has agreed to drop the logo use and the "teams up" language deployed in its April 5 press release.

            The investment in a fund controlled by a member of the UN Investment Committee UNHCR defends, including by pointing out that Morgan Stanley's Francine Bovich is also on the UN Investment Board, while the UN does much business with JPMorgan Chase. (Morgan Stanley and JPMorgan Chase, despite the comment reference to Pierpont, are not related companies.) The UNHCR memo's argument is that it's too complicated or burdensome to avoid conflicts of interest. UNHCR's earlier justification to Inner City Press argued that "we are not talking about the usual procurement procedure," when talking about an investment in a fund controlled by a member of the UN Investment Committee.

            This conflict-or-reform debate has included at least in the carbon copies Deputy Secretary-General Mark Malloch-Brown, who appears to have agreed that UNHCR's actions were improper. The paper trail may be important. The story began with a UNHCR press release on April 5 of this year, headlined "New corporate investment scheme helps fund UN quake relief efforts" and stating that "the United Nations refugee agency has teamed up with two Swiss investment companies in a scheme that will benefit its earthquake relief operation in Pakistan. The joint project launched by the UN High Commissioner for Refugees (UNHCR), Zurich-based Societe Generale Corporate & Investment Banking, and derilab s.a., a derivatives company, will allow investors to participate in a financial product that affords a unique opportunity to support reconstruction and relief efforts."

   Inner City Press inquired into the release and published a round-up article on April 11 questioning the partnership: "It might well be on the level. But it's not yet clear that if it weren't, the scheme would not proceed. It would help if the follow-up questions were answered."

Inner City Press' article included at length the statement of UNHCR's Olivier Delarue:

From: Olivier Pierre Delarue
To: Matthew.Lee [at]
Sent: Thu, 6 Apr 2006 14:18:54 +0200
Subject: Re: Fwd: Press inquiry concerning how Societe Generale Corporate & Investment Banking, and derilab s.a were selected for participation with UNHCR

I work in UNHCR's Private Sector Fund Raising Service as Senior Corporate Relations Officer and your query about this fund raising initiative was forwarded to me... Based on the previous exchange of email you sent, your focus seems to be on the procurement and bidding process done by the UN. This particular initiative, however, is a fund raising project first proposed by  corporate entities and aimed at raising funds for UNHCR's humanitarian program.  Therefore, as with any fund raising project, we are not talking about the usual procurement procedure.

In my capacity as Senior Corporate Relations Officer, my role is to work on creating new partnerships with the corporate world in order to increase our donor base and receive greater financial and expertise from the private sector. In this particular case, Derilab s.a. approached us in the aftermath of the earthquake in South Asia and proposed to assist us pro bono in finding new ways of raising donations from the financial market for this emergency. As this was never done in the past, a financial product which incorporated a charity/donation component was not easy to build. Derilab presented the project to all the major banks involved in structured and derivative products. Only Societe Generale showed a serious interest in working on this new concept. As matter of principle, UNHCR screens all new partnerships with the private sector. Societe Generale, the only bank to show an interest for this project, was screened. As a result of our careful review, Societe Generale was screened positively for various reasons, including their participation in the UN Global Compact. Please note that in the case of this initiative, UNHCR is only a receiver of donations through this financial product -- but is not endorsing the product itself

  The phrase "we are not talking about the usual procurement procedure" may have been an understatement, given the investment with a company controlled by an individual who is a member of the UN Investment Committee. Regarding the last above-quoted phrase, even the UN Headquarters staff who subsequently questioned UNHCR's program apparently found dubious this last point: the use of the phrase "teams up" implies an endorsement, the question-memo noted. ICP reiterated its broader questions to UNHCR in Geneva on June 1, including directly to Mr. Delarue, to whom UNHCR's spokesman's office also forwarded the request.

     Several UN officials contacted Inner City Press about its initial story. Subsequently UN staff in New York wrote to UNHCR in Geneva, demanding an explanation including of the seemingly violative use of the UN logo contrary to GA Resol. 92(I) of 1946.  More than a month later, UNHCR's Helmut Buss sent back a multi-page memo, acknowledging the investment in Pictet Funds Indian Equity Fund, and that Ivan Pictet is on the UN Investment Committee. Mr. Buss claimed to have determined that this conflict had been stumbled into "in good faith," and that avoiding conflicts would be difficult, given for example that Morgan Stanley's Francine Bovich is also on the UN Investment Board.

   How will conflicts of interest be avoided in the future?  More than 12 hours before initial publication of this report, Inner City Press put these questions to UNHCR in Geneva, as well as to Ivan Pictet by fax at his place of work. Inner City Press' request for UNHCR's comment stated that "while it shouldn't need to be said, Inner City Press has been appreciative of UNHCR's responses, when received, on refugee-related questions on Zimbabwe, Uzbekistan, etc.. This inquiry, which began in April and was attempted to be concluded in June, is neither anti-refugee nor anti-UNHCR. As many have said, transparency is good for the UN system, in the long run. In this short-run, this is a formal request for UNHCR's written comment as quickly as possible."

            In the short and medium-run, UNHCR has declined to answer press questions about this, back in April, in early June, and now. What will happen in the longer run remains to be seen.

            At 8:15 a.m. New York time, 12 hours after sending its written request for comment, Inner City Press telephoned UNHCR deputy spokeswoman Jennifer Pagonis in Geneva and reiterated the request for comment. Ms. Pagonis indicated that the request had already been forwarded to Mr. Delarue for response by midday. But since he had been asked back in early June to comment on developments of which Inner City Press was even then aware, and he did not respond, to await Mr. Delarue's belated second response seemed neither necessary nor appropriate. "It is not really about Mister Delarue," Inner City Press explained to UNHCR's Jennifer Pagonis. "It's about UNHCR and the wider United Nations."  Subsequently, the following was received:

From: REDMOND [at]

To: Matthew.Lee [at], BUSS [at], DELARUE [at]

Sent: Wed, 12 Jul 2006 11:01 AM

Subject: Re: Request for comment asap on UNHCR / Societe Generale's Kashmir Relief Note/ Pictet Funds - on deadline

Dear Mr. Lee,

Olivier Delarue and colleagues have looked into your questions and their reply follows.

- Use of UN name and logo: UNHCR has not authorized Societe Generale to use the UN name and logo, nor of the UNHCR official logo, both of which are indeed protected under GA/RES/92(I) of 1946. In line with the "Guidelines on Cooperation between the United Nations and the Business Community", issued by the Secretary-General on 17 July 2000, however, UNHCR has, for the sole purpose of the raising of funds for UNHCR, allowed SocGen to use, on its brochure announcing the KRN, the UNHCR "visibility logo" with the addition "in support of". For your information, Article 16 (d) (ii) of the a/m Guidelines authorizes the use of the name and emblem "to assist in the raising of funds for the Organization".

- Potential conflict of interest: Based on the information available to us, there is no conflict of interest created for Mr. Ivan Pictet, managing partner of Pictet & Cie, and ad hoc member of the UN Investments Committee, by the fact that Pictet Funds Indian Equities is one of the funds in which KRN funds are invested. Societe Generale, the issuer of the Note, is solely responsible for choosing the funds and this selection is based on recognized risk management and hedging criteria; UNHCR plays a purely passive role as the recipient of a donation and has no interest in the performance of the Note. Moreover, Mr. Pictet's membership in the UN Investments Committee was unknown to all parties involved in drawing up this investment product, and we trust therefore that the decision to include a fund managed by Pictet & Cie was taken in good faith. In any event, Mr. Pictet had no involvement whatsoever in UNHCR's decision to accept the funds thus raised by SocGen. Finally, you may also note that the volume of this investment (US$1 million shared over a number of funds, only one of which is Pictet & Cie's) cannot be considered to benefit Mr. Pictet in any substantial manner.

- Screening of Corporate Partners: Societe Generale is a member of the Global Compact . Moreover, our research at the time demonstrated that Societe Generale was rated over the past years as one of the best banks in the world, and the best in terms of derivative products. For your information, private sector partnerships are a relatively recent addition to UNHCR's fundraising strategy. In its dealings with the private sector, UNHCR consistently bases itself on the a/m Guidelines issued by the Secretary-General. In addition, UNHCR is in the process of installing an advisory board to ensure even more checks and balances. This process, by the way, was already on the way before the KRN was even first considered.

Derilab, finally, is not a signatory to the Global Compact. It is a very small Swiss company consisting of former bankers, that offered to provide its expertise in the highly specialized field of derivative products to come up with innovative approaches that could increase UNHCR's ability to raise funds from the financial market.

Apologies for the delay in getting back to you. The past month is one of the busiest times of the year at UNHCR.

Regards, Ron Redmond

Head, Media Relations & Public Information, UNHCR Geneva

Update 1 p.m. July 12 -- Asked at the noon briefing if UNHCR is correct in invoking in its defense of this program and investments Kofi Annan's "Guidelines on Cooperation between the United Nations and the Business Community," spokeswoman Marie Okabe said that UNHCR has submitted a detailed response and that she, and presumably for now the Secretariat, have nothing to add to it. While UNHCR's written response was, as always, appreciated, on-the-record inquiries will continue, first into whether this UNHCR program, SocGen's initial use of the logo and the investment with Pictet & Cie, are viewed within the Secretariat and elsewhere as comporting with current and proposed standards of transparency and ethics.  Inner City Press is aware of views within the Secretariat, not close to the ground, which are at odds with UNHCR's positions and actions. These views are being solicited, on-the-record.

If Ambassadors to the UN, even from the Permanent Five, answer questions at the Security Council stakeout about their positions on such issues as amnesty for the Lords Resistance Army's Joseph Kony, and who should repair the Gaza electrical power plant, the Secretariat should answer regarding this UNHCR program. Watch this space [and see Report of July 13, 2006, above.]

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