HOW DO TNCS AFFECT SOVEREIGNTY? Brainstorm How do TNCs affect the sovereignty of states? Power and Influence of TNCs • Stats on page 58 of textbook. Royal Dutch Shell Case Study: Shell in Nigeria • Shell is a group of over 1700 companies all over the world, the group is owned by Royal Dutch of the Netherlands. • Shell Nigeria is one of the largest oil producers in the Royal Dutch Shell group. • 80% of oil extraction in Nigeria is in the Niger Delta, the southeast region of the country • The Delta is home to many minority ethnic groups, including the Ogoni. Case Study: Shell in Nigeria • Royal Dutch Shell accounts for more than 40% of Nigeria’s petroleum production. Beginnings of controversy • In the 1990s tensions arose between the native Ogoni people of the Niger Delta and Shell. • Concerns were that very little of the money being earned from oil was reaching the people who live there. • Environmental damage to the natural environment caused by Shell’s practices. The tension builds… • In 1993 the Movement for the Survival of the Ogoni People (MOSOP) organised large protests against Shell and the government, often occupying the refineries. • Shell withdrew from the area. • The Nigerian government raided their villages and arrested protest leaders. • Some of these protesters were later executed by the government. Kenule (Ken) Saro-Wiwa Memorial Accusations… • There have been accusations about the conduct of the Shell group in Nigeria. • One is that Shell provides over 50% of the income keeping the Nigerian dictatorship in power. • Source: http://www.essentialaction.org/shell/issues.html • 9 Activists were hung by the Nigerian government. • Emanuel Nnadozie, writing of the contributions of oil to the national economy of Nigeria, observed "Oil is a curse which means only poverty, hunger, disease and exploitation" for those living in oil producing areas. From the ‘Boycott Shell’ website: • Ogoni villages have no clean water, little electricity, few telephones, abysmal health care, and no jobs for displaced farmers and fisher persons, and adding insult to injury, face the effects of unrestrained environmental molestation by Shell everyday. • When crude oil touches the leaf of a yam or cassava, or whatever economic trees we have, it dries immediately, it's so dangerous and somebody who was coming from, say, Shell was arguing with me so I told him that you're an engineer, you have been trained, you went to the university, I did not go to the university, but I know that what you have been saying in the university sleeps with me here so you cannot be more qualified in crude oil than myself who sleeps with crude oil. -Chief GNK Gininwa of Korokoro, "The Drilling Fields", Glenn Ellis (Director), 1994 The Issues… • Natural-Gas Flaring • Oil Spills • Pipelines and Constructions • Health Impacts By the way… this is natural gas flaring: Why allow this? • Oil companies have influence on the government • 80% of Nigerian government revenue comes from oil, of which half is from Shell. • Bribes What was done? • The UN accused Nigeria and Shell of abusing Human Rights and failing to protect the environment in oil producing regions. • A report, United Nations Special Rapporteur's report on Nigeria found that; "well armed security force is intermittently employed against protesters.” • The report was unusual both because of its frankness and its focus on Shell, instead of only on member countries. The Commonwealth and the US • Nigeria's membership of the Commonwealth was suspended by Commonwealth Heads of Government on 11 November 1995. • It has not been expelled, however. • The US has threatened to take action, however it never has. Video: ‘The Case Against Shell’ • How Shell infiltrated Nigeria • http://www.youtube.com/watch?v=afL0N191IFI • UN Slams Shell over Nigeria Oil Pollution • http://www.youtube.com/watch?v=YmI3xjZk_y0 Recent Developments • In 2009 Shell agreed to pay $15.5 million in a legal settlement. • They have not accepted any liability. • In 2009 Shell was the subject of an Amnesty International report that focused on the link between Shell’s activities in Nigeria and the abuse of human rights in the country. Recent Developments • 2010 a leaked cable revealed that Shall claims to have inserted staff into the main ministries of the Nigerian government and to “know everything that was being done in those ministries” • Shell regularly made payments to the Nigerian military to prevent protests from occurring. Article • “Shell settles Nigeria Death Case” Practice Essay Question “The rise of TNCs in the post-Cold War world have diluted the concept of sovereignty.” Discuss.