Posted September 20, 2013 by Ben Lilliston
Transformative changes are needed in our food, agriculture and trade systems in order to increase diversity on farms, reduce our use of fertilizer and other inputs, support small-scale farmers and create strong local food systems. That’s the conclusion of a remarkable new publication from the U.N. Commission on Trade and Development (UNCTAD).
The report, Trade and Environment Review 2013: Wake Up Before it is Too Late, included contributions from more than 60 experts around the world (including a commentary from IATP). The report includes in-depth sections on the shift toward more sustainable, resilient agriculture; livestock production and climate change; the importance of research and extension; the role of land use; and the role of reforming global trade rules.
The report links global security and escalating conflicts with the urgent need to transform agriculture toward what it calls “ecological intensification.” The report concludes, “This implies a rapid and significant shift from conventional, monoculture-based and high-external-input-dependent industrial production toward mosaics of sustainable, regenerative production systems that also considerably improve the productivity of small-scale farmers.”
The UNCTAD report identified key indicators for the transformation needed in agriculture:
IATP’s contribution focused on the effects of trade liberalization on agriculture systems. We argued that trade liberalization both at the WTO and in regional deals like the North American Free Trade Agreement (NAFTA) had increased volatility and corporate concentration in agriculture markets, while undermining the development of locally-based, agroecological systems that better support farmers.
The report’s findings are in stark contrast to the accelerated push for new free trade agreements, including the Trans Pacific Partnership (TPP) and the U.S.-EU Trade and Investment Partnership (TTIP), which expand a long discredited model of economic development designed primarily to strengthen the hold of multinational corporate and financial firms on the global economy. Neither global climate talks nor other global food security forums reflect the urgency expressed in the UNCTAD report to transform agriculture.
In 2007, another important report out of the multilateral system, the International Assessment of Agricultural Knowledge, Science and Technology for Development (IAASTD), with contributions from experts from over 100 countries (and endorsed by nearly 60 countries), came to very similar conclusions. The IAASTD report concluded that “Business as Usual is Not an Option,” and the shift toward agroecological approaches was urgent and necessary for food security and climate resilience. Unfortunately, business as usual has largely continued. Maybe this new UNCTAD report will provide the tipping point for the policy transformation that must take place “before it’s too late.”
Posted September 19, 2013 by Shiney Varghese
In the midst of worrisome news about droughts, desertification, unreliable monsoons and growing concerns around water security around the world, the announcement by the UNESCO and Kenyan officials at the recent International Water Security Conference in Nairobi was anything but gloomy. The finding of potentially huge groundwater resources in northwestern Kenya is indeed a blessing, not only for the herding communities of drought-prone Turkana, but also for the region as a whole.
Until very recently the region was best known to the global water community both for the lack of access to water that mark the lives and livelihoods of indigenous communities that live there, and for their efforts to save Turkana Lake, the largest permanent desert lake in the world according to International Rivers.
But a recent survey by RTI, a company hired by U.N., found groundwater systems with a potential of storing about 250 billion cubic meters (or about 66 trillion gallons) in the Kachoda, Gatome, Nkalale and Lockichar areas, with the largest aquifer being located in the Lokitipi Basin—all of them in Turkana county, one of the 47 counties in Kenya. Of these, the three smaller aquifers combined are estimated to store about 30 billion cubic meters of water, once confirmed by drilling.
But the Lotikipi Basin Aquifer, the largest of them—it has already been confirmed—is likely to store about 207 billion cubic meters, and has a recharge rate of 1.2 billion cubic meters or about 317 billion gallons a year, equivalent to 40 percent of the current annual water use in Kenya. Kenyan water resource planners, with their ability to estimate the recharge rate, are in a better position today to plan and keep the water withdrawal below this rate. The Kenyan government, which has ushered in policy reforms in several sectors, might be in a position to ensure this environmental cap.
Yet, some of the issues I raised in an earlier blog come to mind. Referring to a Guardian report on a study that looked at rising sea levels from a new angle, we urged caution. That study found that efforts to meet increasing freshwater demand by harnessing “fossil” groundwater [which cannot be replenished for millennia under current climate conditions] contributes more to rising sea levels than melting glaciers. The authors were particularly concerned about deep tube-well drilling—a technology adapted from the oil industry—which has contributed to a number of problems associated with irrigated agriculture. New initiatives in groundwater development could learn from past lessons (India, China and the United States to list a few), and in view of these experiences the temptation to promote groundwater development in Kenya needs to be tempered with caution.
This is especially important in the Kenyan context. Along with the new ground water resources, RTI has also located some oil reserves in the region. As far as the Kenyan government is concerned, the temptation to exploit oil will be high, as will the temptation to extract water to ensure food security. As far as international investors and international institutions are concerned, the temptation to appropriate the newfound wealth for global good will be high.
Turkana is also the poorest county in the country, ranking 47th in poverty rate (94.3 percent, while the national average is 47.2 percent as per the Kenya Household and Budget Survey). Most people who live there, especially in the rural areas, belong to herding/ fishing communities which have a different relation with natural resources as well as with cash economy. As the state and private sector begin investing in the region, it is up to democratic institutions in Kenya to ensure that marginalized groups amongst the Turkana inhabitants have a say in the development of these water resources.
Posted September 12, 2013 by Shefali Sharma
Last week, the U.S. treasury approved the largest takeover by an international firm of a U.S. food company. It paved the way for China’s largest pork processor, Shuanghui, to merge with Smithfield, the U.S.’s largest pork processor. The fact that it was a Chinese company stirred up so much controversy that the Senate Agriculture Committee held a hearing July 10 entitled, “Smithfield and Beyond: Examining Foreign Purchases of American Food Companies.” A major concern was foreign ownership of the U.S. food supply and whether the U.S. review process of foreign takeovers addresses food safety and “protection of American technologies.” There was little doubt that this merger would be approved by Treasury’s Committee on Foreign Investment in the United States (CFIUS): Shuanghui is willing to absorb over $2 billion of Smithfield’s debt; U.S. hog exports to China are expected to increase; and private equity firms on both sides of the Pacific will profit from a much stronger global hog processing company in two of the largest pork markets in the world (See IATP's blogs Two Converging Rivers: Understanding Shuanghui’s acquisition of Smithfield and Shuanghui acquires Smithfield: The view from China and IATP's webinar China, Smithfield and the Global Meat Industry)
This was a rare time when the U.S. Senate agriculture committee tackled the question of how developments in the food industry affect national security and whether this deal sets a bad precedent. Their analysis of course was limited to whether China would steal U.S. technology on pork genetics, feed and slaughtering, whether the deal would weaken U.S. food safety, result in job losses and hurt U.S. hog exporters. What the hearing could and should have addressed is how this deal will exacerbate the extreme corporate concentration of the U.S. (and global) meat industry, the resulting impact on hog farmers and rural communities, working conditions in processing plants and the continued offloading of environmental and public health costs generated by global companies like Smithfield and Shuanghui onto the American (and Chinese) public.
Rather than curbing corporate concentration, the House of Representatives has gone one step further in its version of the Farm Bill to limit USDA’s authority to protect against unfair practices in the livestock and poultry sectors. A letter sent September 9 by over a 140 U.S. organizations (including IATP) to the Senate and House agriculture committees called for a rejection of such a provision in the House version of the 2013 Farm Bill. The letter states:
During the 2008 Farm Bill process, Congress heard extensively from livestock and poultry producers, farmer organizations, and consumer groups about anti competitive and unfair business practices that unfortunately have become commonplace in the livestock and poultry sectors of our agricultural economy. As a result, the final 2008 Farm Bill included provisions to require USDA to write regulations to address the most egregious of these practices and to define certain terms in the statute. Section 11102 of the House version of the 2013 Farm Bill would repeal the 2008 Farm Bill provision that addressed these concerns and place a broad limitation on USDA’s authority to enforce many aspects of the Packers and Stockyards Act of 1921.
The critical issue here is the concentrated power of the livestock industry. And we are heading in the wrong direction. The Shuanghui-Smithfield deal fundamentally highlights the global nature of this industry and its trend towards further concentration. The CFIUS approval shows U.S. administration support for that trend as does the House version of the Farm Bill. Isn’t the corporate takeover of the U.S. food supply a national security issue?
In 2010, the U.S. Department of Justice and the Department of Agriculture held five public hearings on the role of antitrust in U.S. agriculture—the livestock industry was a critical part of that discussion. Sadly, there was little follow up after the rigorous examination of the industry. Over 15,000 comments were submitted by farmers, consumers, researchers, industry and elected officials.
The Global Development and Environment Institute (GDAE) submitted a paper titled Buyer Power in the U.S. Hog Markets: A Critical Review of the Literature. They found that the U.S. pork industry has gone through rapid concentration in just 25 years—with four packers controlling two-thirds of the market. Smithfield controlled 31 percent of that market, being the only buyer in the U.S. Southeast. The share of hogs sold in the open market dramatically dropped from 62 percent to just 8 percent in 15 years (1995-2010). This is the oppressive effect of the meatpacking industry on small and independent livestock producers. And it has left producers with little choice and little power, forcing low spot prices for hogs in the market (below the cost of production) and “unusually large variation in prices.” Trade union representatives of workers in meat packing plants also complain of the concentrated power of the food retail industry in further pushing down the supply chain and forcing poor worker conditions. According to GDAE, the top four U.S. food retailers went from 19 percent control of the market to nearly 60 percent in a period of 12 years (1997–2009). Farmers, workers and the public all lose in such a scenario. And it makes our food system beholden to corporate greed.
In a letter submitted to the U.S. Administration on the Smithfield deal, a group of organizations raised several objections about the Shuanghui-Smithfield merger. They also underlined problems with Smithfield:
While Smithfield’s safety record is better than Shuanghui’s, the company is not without blemishes. In 2013, Smithfield recalled 38,000 pounds of sausage over concerns that the products might contain plastic fragments. In 2012, Smithfield’s packing plants in Poland recalled 13,600 pounds of meat products for microbial or labeling issues. In 2011, Smithfield recalled 216,000 pounds of flavored pork loins that may have contained unlabeled dairy ingredients that could pose an allergy risk to consumers.
There have been many complaints against the company for environmental issues as well, particularly in North Carolina, home of much of the company’s production. The National Sustainable Agriculture Coalition reports that 600 residents in Wake County, North Carolina have filed complaints against Smithfield that the company’s hog waste lagoons and manure applications are causing problems for them.
China’s farmers, consumers and environment are also confronting similar problems with commercial and specialized hog production (see IATP’s Feeding China’s Pigs). The critical issue here is not the nationality of the industrial livestock company, but its size, practices and market power. It’s the ability of a few companies to change the entire system of producing livestock in a globalized world where people, the environment and public health come out as losing entities. Our government has a responsibility to rectify this injustice—reversing corporate concentration of this industry is the first step in that direction.
To better understand the role of the global meat industry around the world, IATP will be publishing a series of reports on China’s livestock sector in the coming months.
Posted September 9, 2013 by Corinne Rafferty
IATP is proud to announce the election of two new members to its board of directors, Firoze Manji and Daniel De La Torre Ugarte.
Firoze Manji is a leading African intellectual and activist. He is the founder and former editor-in-chief of Pambazuka News and Pambazuka Press, and the founder and former executive director (1997–2010) of Fahamu – Networks for Social Justice. He has published widely on health, social policy, human rights and political sciences, and authored and edited a wide range of books on social justice in Africa, including on women’s rights, trade justice, China’s role in Africa and more on the recent uprisings in Africa. In March of 2013 Firoze moved to Dakar to be head of the Council for the Development of Social Science Research in Africa (CODESRIA) documentation and information center. He shares IATP’s vision of a world in which the global commons is protected, corporate control is dismantled, and agriculture, food and energy systems are decentralized and democratized. He is the first IATP board member from Africa, and we are grateful to have his keen analytic mind in helping shape IATP’s direction.
Dr. Daniel De La Torre Ugarte, a longtime friend and ally of IATP, has been one the nation’s strongest proponents of agriculture policy which benefits farmers, the land, the environment and public health. He is a professor in the Department of Agricultural Economics of the University of Tennessee, where he is also the associate director of the Agricultural Policy Analysis Center. Originally from Peru, where he earned a degree in economics, he went on to earn a Ph.D. in agricultural economics at Oklahoma State University in 1992. Dr. De La Torre's primary areas of research have been the impacts of U.S. agricultural policy; the consequences of trade liberalization in agriculture; the feasibility of international supply management in agriculture; and the synergism of agricultural and energy policy in reducing poverty and reduced greenhouse gas emissions. He is engaged in international dialogues to develop mechanisms that would allow agricultural trade to contribute to global food security and sustainable economic development. Daniel has recently returned to his native Peru, where he will be consulting with the government in addition to continuing his work in academia.
Posted September 6, 2013 by Dr. Steve Suppan
This question was posed to me after I was detained for questioning at passport control in St. Petersburg, Russia airport. The Group of 20 Leaders’ meeting will take place here on September 5–6. I had arrived for the G-20 Counter Summit organized by the Post-Globalization Initiative, whose name was stamped on my visa as the inviting organization. Nevertheless, this was a question worth asking, if not for the apparent purpose of turning me away at the border.
After producing evidence of my hotel address, Russian contact person, return plane ticket etc., I was allowed to pass and now am free to ponder this question. More free than members of Russian civil society organizations and even Parliamentarians, who, according to the St. Petersburg Times, have been interrogated by the police about whether during the G-20, they would engage in “terrorist activities” in protest of the G-20. Shades of the aftermath of November 2001, when opposition to the World Trade Organization’s Doha agenda was affiliated with “terrorism” by proponents of that agenda. Although the technologies of official surveillance have become more sophisticated, the ideological purposes behind them have not changed so much.
The PGlobal organizers said that fundraising for the Counter Summit was not as difficult as they had anticipated. Finance-led globalization, to invoke the U.N. Conference on Trade and Development analysis, has not been good for most Russians. “Speculation” is a dirty word here, not the least because the government invested state pension funds in the derivatives market and lost heavily, according to Oskana Dmitrieva, an economist and member of Russia’s Parliament. Dr. Dmitrieva spoke on the panel “Confronting Speculation, Illicit Capital Flows and Tax Havens.” According to a Russian colleague, she spoke with unusual frankness for a Russian politician, given that some Russian politicians are the beneficiaries of banking secrecy laws that hide their tax evasion and offshore bank accounts. She said that the Russian government had sunk nearly three trillion rubles into the “virtual economy” of speculative instruments, even though the government had done little research into the risks of these instruments. Some of the money went into mortgage derivatives in Russia’s own subprime crisis
It was my role on the panel to explain the what and how of dark market (over-the-counter derivatives) speculation, and why the G-20 commitment in 2009 to make dark markets transparent had been resisted by governments who sought to restrict regulator access to trading data. While conceding that the global banks rescued by governments had seemingly unlimited budgets to lobby against financial reform, I concluded my presentation with a summary of institutional and civil society sources of support for financial reform. Not the least of these sources is a July 11 agreement between the European Commission and the U.S. Commodity Futures Trading Commission (CFTC) that “the stricter rule applies” in cases of overlapping rules. The official Over the Counter Derivatives Regulators Group summarized the July 11 agreement in its August 30 report to the G-20 finance ministers meeting just prior to the arrival of their bosses.
The questions about my presentation were not entirely new to me, but the answers still unnerve me. For example, why aren’t Commodity Index Funds banned since they have caused price volatility and increases unjustified by market fundamentals, disrupted markets and harmed consumers? I said that in U.S. commercial law it is very difficult to ban any activity that cannot be shown to be inherently fraudulent, even if it is highly damaging. Nor did I have a good answer to the question “When will the global banks finally be regulated as global entities, and not with regulations designed to stop at national boundaries?” Is it anti-globalist to require global banks and corporations to submit to globally effective regulation?
Boris Kagarlitsky, a Counter Summit organizer, said that the meeting brought together the largest group of critics of the “free” but dark market economic order ever assembled in Russia. I was among the 30 international guests who spoke to and with a small but intensely engaged Russian public, thanks to a valiant and skilled group of interpreters. It is difficult to summarize so many speakers and topics but a few themes emerged.
First, there was a huge amount of capital flight from developing countries’ banks to U.S. and European banks, resulting in developing country currencies falling sharply against the dollar. For example, thus far in 2013, the value of the Brazilian real has fallen 14 percent; the value of the Indian rupee by more than 21 percent. Capital controls and performance requirements for investment could stem some of this currency depression but the former are punished by the International Monetary Fund, while the latter are banned in Bilateral Investment Treaties and/or Free Trade Agreements.
Uncontrolled Foreign Direct Investment can have very negative effects on food security, reported Riza Damanik of Indonesia for Global Justice. The Indonesia government evaluates economic health in terms of Gross Domestic Product and invests little to support domestic agricultural production. For example, 99 percent of investment in seed production is foreign. Investment in palm oil plantations has displaced domestic rice production and resulted in environmental damage to forests and forest people when land is cleared for palm oil production, and huge import dependence both for food and agricultural inputs.
Indonesia will host the next World Trade Organization ministerial meeting, December 3–6 in Bali. Riza said that under the WTO, only corporations have rights. At the meetings his coalition and others will organize in Bali, they plan to champion human rights, including the right to food.
However, human rights, financial regulation and trade policy are overshadowed in the mass media whenever the threat of war looms. Venezuelan Edgardo Lander, a fellow at the Transnational Institute, said that the Obama administration’s threat to bomb Syria in retaliation for the Syrian government’s alleged use of chemical weapons against civilians would trigger a wider conflict. He said that the Obama administration’s resort to violence revealed a crisis of “civilizational models” since G-20 governments would bail out banks and defend corporate assets with military force, but do nothing to reduce “the greatest levels of inequality in human history.”
Even though the debate about whether to bomb Syria was not on the Counter Summit agenda, it was added in a prefatory panel. The issue was less whether chemical weapons had been used but whether the U.S. should defy likely Russian and Chinese vetoes in the U.N. Security Council and bomb unilaterally. U.S. military power, and not its control over global finance, was characterized by several Counter Summiteers as the ultimate guarantor of economic imperialism. Professor Samir Amin said that the attack on Syria would be another episode in which the military is used strategically to preserve capitalism, as in his home country of Egypt.
Dorothy Guerrero, of Focus on the Global South, provided a great example of the interconnected analyses of many Counter Summit participants: the G-20 Summit would attempt to present the broken world economy and austerity policies to slash aid to the most vulnerable as “the new normal.” But in her native Philippines, “there is no new climate normal, just climate chaos and more climate change–related migration”. Indeed, she said, if the bombing of Syria triggered military conflict in the Middle East, millions of Philippines working in Middle Eastern countries would return to a country without jobs and services for them.
Most Counter Summit participants consider the G-20 to be an illegitimate venue for global and economic governance, because it circumvents the universal representation of the United Nations. Therefore, those participants would not be involved in the G-20 civil society (C-20) meeting of what Boris Kagarlitsky characterized as the “tame and civilized NGOs.” No doubt, the C-20 process provides less room for the radical thinking typical of the Counter Summit. And no doubt, the G-20 does not represent, nor even try to represent, the demands and needs of more than 170 other U.N. members. But still it is a pity that no G-20 government representative, save for a sole Brazilian finance ministry official, got to listen and respond to Counter Summit participant views on globalization in its varied forms.
Posted September 6, 2013 by Ben Lilliston
In the wake of protests in the Philippines over genetically engineered Golden Rice, a series of articles have appeared in the U.S. mainstream press (e.g., the New York Times) and alternative publications like Slate and Grist, all coming to the vigorous defense of the latest incarnation of this wonder rice designed to prevent malnutrition. Through veiled and at times explicit condescension, the U.S. media consensus seems to be that opposition to this wonder rice is based on scientific ignorance: Why wouldn’t you want to address global malnutrition?
A gaping hole in U.S. coverage is the perspectives of Philippine farm organizations, like the Asian Farmers Association affiliate PAKISAMA, or really anyone from the Philippines who opposes Golden Rice. By not including these voices, these reports miss a fundamental issue at the center of all issues around genetically engineered (GE) foods: power. Who controls the technology? Who controls what farmers can grow, and what people eat? Not coincidently, these questions are also at the center of addressing global hunger.
While most GE crops have virtually no benefit for eaters (they are fed to animals or used as ingredients in processed food or are non-food items like cotton), Golden Rice has always been touted as the exception. Golden Rice, still in the pipeline after more than a decade of research, intends to boost Vitamin A levels in rice and promises to address a number of nutritional challenges, including blindness, for the world’s hungry.
Opposition to Golden Rice needs to be placed in the global context of how the biotech industry has relentlessly and aggressively (with the assistance of the U.S. government) thrust this technology on the rest of the world. Resistance to GE crops is widespread around the world among both developed and developing countries, often led by farmers and aligned organizations. SEARICE (the Southeast Asia Regional Initiatives for Community Empowerment) offers insight by describing the experience of Philippine farmers after the introduction of GE Bt corn: corn farmers lost access to traditional varieties, they can no longer share or exchange seeds with other farmers, and they are paying double the cost for GE seeds for what is largely the same yield, leading to increasing indebtedness.
Farmers have had similar experiences with GE crops all over the world, where legal and policy frameworks (bolstered by global trade rules) empower biotech seed companies over the rights of farmers and communities.
SEARICE writes in their critique of Golden Rice: “The issue on GMO is not on genetic engineering per se, but on how this has been used and is being used to wrest control and access over plant genetic resources on which the farmers’ over time have been the stewards and innovators so that we would have sufficient food to eat and raw materials for the wide range of economic and industrial uses […]. Science and technology then for the farmers should be able to strengthen not supplant their traditional knowledge and it should democratize access to plant genetic resources and not control or monopolize it.”
While Golden Rice supporters argue that it is different than other GE crops—it has a “Humanitarian license” which sublicenses the technology to public research institutions and low-income farmers in developing countries free of charge—SEARICE points out that Syngenta still holds the commercial rights to the Golden Rice patent for some mysterious future use.
Suggesting that we have to pick between supporting Golden Rice or mass malnourishment is a false choice. What if the billions of dollars (and now over a decade of time) spent on developing Golden Rice had instead been invested on a program supporting food sovereignty goals linked to farmer and consumer empowerment, like what Philippine groups are calling for: increased capacity for technical support and farmer-led seed breeding; promotion of the many other locally produced natural food sources of vitamin A; and encouraging the planting of small, bio-intense gardens in homes and communities.
At the heart of efforts to push for GE labeling here in the U.S., to opposition to new GE crops in Europe, the Philippines, Chile or India, is power. Who controls seeds, who controls the research agenda, who controls what happens on the farm, and who controls what we feed ourselves? These are all issues on which the biotech industry hasn’t ceded an inch– they want it all. Power is not an issue the scientific community likes to talk about openly, but journalists can and should.
Posted September 3, 2013 by Patrick Tsai
As controversy over TransCanada’s Keystone XL pipeline has captured most of America’s attention, Minnesotans have been dealing with a different pipeline carrying tar sands bitumen to the United States. On July 17, 2013, the Minnesota Public Utilities Commission (PUC) granted Enbridge, L.P. a 120,000-barrel-per-day (bpd) capacity increase to line 67, the “Alberta Clipper”, from 450,000 bpd to 570,000 bpd.
This is the first of a two-phase capacity increase that Enbridge hopes will reach 880,000 bpd (50,000 bpd more than the projected 830,000 bpd capacity of Keystone XL). The application for Enbridge’s second-phase increase has garnered more attention and activism by Minnesota pipeline opponents, led by MN350. Comments submitted by MN350’s legal team to the PUC point out a number of contested facts found within Enbridge’s Phase 2 application. On September 4, the PUC will make a decision on whether a contested case hearing is necessary as a result of the disputed facts uncovered during the comment period. MN350 has asked the public to “pack the PUC to send the message that the contested case hearing is necessary.” There will also be an event on September 9 in Duluth organized by IEN, Sierra Club, Idle No More, MN ASAP and MN350 to resist the tar sands being transported through northern Minnesota. Contentious debate over tar sands mining and its exportation is not new to environmentalists and trade analysts alike.
Canadian crude has become a longstanding source of energy for the U.S. To keep the flow continuous and secure, the U.S. has strategically negotiated free trade agreements with an eye toward control of future Canadian energy supply and less toward sustained mutual benefit. The result is an agreement that drives energy exports from Canada, guaranteeing the U.S. a high percentage of Canadian oil and natural gas. Under NAFTA (article 605), Canada must maintain the previous three-year proportional average of energy exports of total energy supply (domestic production plus imports) to the United States. This means that if, for example, Canada has exported 50 percent of their total energy supply to the U.S. over the past three years, they must maintain energy exports to the U.S. at 50 percent or higher of their total supply, even if it means allocating more energy away from its own domestic need.
The proportionality clause is unique in that there is no similar clause in any other trade agreement, nor does NAFTA’s other signatory (Mexico) ascribe to it (page 26). Projections by the Parkland Institute show that even a 10-percent decrease in production would cause a domestic shortfall due to trade obligations, leaving Canadians the options of importing oil from other oil exporters or importing their own oil back from the U.S. Under the proportionality clause, reductions in production caused by natural disaster do not release Canada from these trade obligations. Sovereignty can only be described as absent in cases where Canada is unable to provide its own natural resources to its own people in need.
Still other NAFTA provisions can be used to force tar sands bitumen across the border. Articles within NAFTA’s chapter 11, often referred to as investor-state provisions, could potentially be used by TransCanada to push through Keystone XL, avoiding public debate and environmental regulation. Investor-state provisions allow corporations to bring lawsuits against governments if they perceive unfair treatment or loss of projected revenue. As of March 2013, over 100 cases have been brought about using NAFTA’s chapter 11. The threat of costly legal action deters governments from creating laws and regulations that promote regional development and public safety. In order to avoid chapter 11 lawsuits, governments are inclined to dismiss or ignore proposed laws favoring environmental and public protections if they can possibly be misconstrued as impediments to industry.
Trade rules are not the only avenue through which sovereignty is violated. Due to Enbridge’s failure to procure an easement, Enbridge pipelines illegally pass through Red Lake Nation land near Leonard, Minnesota. Marty Cobenais of the Indigenous Environmental Network first discovered this infraction, and has worked to bring awareness of the pipeline and the effects it has on the environment to Northern Minnesota communities. A group of Red Lake members continue to occupy the trespassed land bringing awareness to the issue through the #RLBLOCKADE campaign.
On July 16, 2013, the EU energy commissioner Gunther Oettinger addressed an audience at the Center for Strategic and International Studies in Washington D.C. Mr. Oettinger spoke of the EU’s declining energy production, its increasing energy import dependence, and the hope that through the Transatlantic Trade and Investment Partnership (TTIP) negotiations, a “trans-Atlantic energy trade” can be established between the U.S. and EU, noting the new energy wealth the U.S. has obtained through unconventional fossil fuel resources. From a social justice perspective, NAFTA presents us with a history of failure due to trade liberalization. It is quite clear that if the TTIP and the Trans Pacific Partnership (TPP) pass with articles similar to the proportionality clause and investor-state provisions, what little voice people and their communities have to control and limit unconventional energy extraction will be handed entirely over to industry, trade representatives and corporate-influenced trade tribunals. Heeding the call to renounce the pipeline at the PUC on September 4 is the first step toward resisting unconventional energy extraction and the violations of sovereignty it brings.
On September 4, pipeline opponents won a small victory. The Minnesota Public Utilities Commission voted in favor of a contested case hearing concerning Enbridge's phase 2 application.
Posted August 30, 2013 by Dale Wiehoff
On September 3 and 4, a large-scale international Counter Summit, intended as an alternative to the September Summit of the G-20, will be held in St. Petersburg, Russia. It is taking place at the Международный Деловой Центр, nab.reki Smolenki 2, and is organized by the Post Globalization Initiative. The Summit’s ambition is to develop new principles of economic and social policy which are not based on the Washington Consensus. As part of the Summit, world renowned experts, economists, politicians and social scientists from Europe, Asia, Africa and the Americas will come together for panel discussions, seminars, and public lectures, including Dr. Steve Suppan of IATP. Dr. Suppan will address speculation in commodity markets.
Counter Summits have a tradition of their own. These major international democratic events are commonly held in response to the elites' G-20 and G-8 Summits and represent alternative points of view on the most pressing social issues. The St. Petersburg Counter Summit is especially important in light of the ongoing global economic crisis. It will suggest ways to solve the problems associated with the crisis of U.S. hegemony, "free trade" and the WTO.
Since the 1980s, neoliberal (neoconservative) ultra-market-oriented policy has been implemented throughout the world, the directives of which are largely determined by the G-8 and the G-20. The onset of the 2008 crisis, however, revealed the historical limits of neoliberalism: global capitalism had lost its effectiveness. Populations now face the task of implementing new economic policies and approaches in the social sphere. The Counter Summit ‘s ambition is to aid society in making the necessary decisions, and taking the step from criticizing neoliberalism to pursuing radical change. A transition from a weak to a strong state, from non-intervention in the economy to regulation is maturing. Recognizing the primacy of social, cultural, scientific and technological progress mandates a qualitative change in policy.
The Counter Summit’s task is to define an alternative vision: one of a multipolar world economy, free from U.S. hegemony and the dominance of transnational corporations. The relevance of these issues for Russia has become especially evident since the country’s accession to the WTO has brought to the fore once again the question of whether the domestic economy should develop in line with the Western trade and financial institutions’ recommendations, or focus on its own priorities.
The Counter Summit agenda includes the following topics: problems of financial markets, the policy of IMF and World Bank, the global economic crisis, the problem of debt and budget cuts. The issues of economic regulation, food safety, environmental protection, labor and social rights, changes in the energy sector and the role of government in the economy will also be discussed. In contrast to liberal politics, the Counter Summit’s participants consider the answer to the crisis to be the welfare state and not the commercialization of public goods. They are convinced that the neoliberal era is coming to an end.
The Counter Summit in St. Petersburg will be attended by dozens of scholars and public figures from around the world, including Egyptian economist Samir Amin, American activist Kevin Danaher, Venezuelan sociologist Edgaro Lander, Canadian political scientist Pierre-Yves Serinet, and Head of Ecuador’s Anti-Monopoly Service, Pedro Paez.
Major international organizations that will take part in the Counter Summit include: Focus on the Global South, Global Exchange (U.S.), Attac France, Via Campesina, the Institute for Agriculture and Trade Policy (U.S.), Our World is Not For Sale (OWINFS), the Tax Justice Network, Latindadd, the Brazilian Network on Peoples Integration (REBRIP), the Committee for the Abolition of World Debt, Campagna per la Riforma Della Banca Mondiale, Plataforma Interamericana de Derechos Humanos, Democracia y Desarrollo (PIDHDD), the Centre for Civil Society (South Africa), Globalization Monitor (China), the Institute for Global Research and Social Movements (Russia), Indonesia For Global Justice, and the Institute for Socioeconomic Studies (INESC, Brazil).
The Post Globalization Initiative was launched in Moscow on April 30, 2013, with the participation of the Institute of Global Research and Social Movements (IGSO), the Transnational Institute (TNI), Focus on the Global South, Attac France and other international institutes. The international initiative aims to find new ways for the economy to recover from the failure of the neoliberal project. The initiative’s experts are convinced that 2008 marks the beginning of a new era. The crisis signaled the end of financial globalization (1982–2008) and paved the way for a development based on new economic and socio-political principles.
Posted August 29, 2013 by Sophia Murphy
It’s increasingly difficult to explain to anyone why multilateral trade talks–once so high on the international policy agenda—are still worth our time and attention. Such attention as international trade garners has moved on to the regional and plurilateral deals, such as the Trans-Pacific Partnership (TPP) and the talks between the U.S. and the E.U. Yet at some level it’s obvious that multilateral co-operation matters more than ever. Trade has to be made to work more effectively for a series of objectives, from reducing pollution and natural resource use to supporting livelihoods to building economies that allow a fairer distribution of benefits. At the same time as we support more decentralized and local control over food systems, we know the world also faces problems that require a multilateral framework.
So where is the multilateral trade community focused? Here is the short version:
That diluted agenda includes three “deliverables” (a favorite term in trade circles). They are agriculture, trade facilitation and an agenda for Least Developed Countries (LDCs). In agriculture the G33 proposal to allow developing countries more leeway to spend public money on grain reserves is taking the lion’s share of negotiators’ time, although two other proposals, one on tariff rate quotas and the other on export subsidies, are also on the table. In trade facilitation, the premise is innocuous and even important (if you are going to trade, who wants red tape and rent-seeking?) but the proposals assume a lot about how trade should work, assumptions that reinforce the already huge advantages of existing global corporations at the expense of smaller, national firms. Industrialized countries propose to tie trade facilitation to development assistance. The third agenda, on LDC issues, includes the promise of duty-free-quota-free market access (at one point known as Everything But Arms but in practice not so generous); preferential treatment in the services agreement; clarification on rules of origin (never simple but vastly more complex in an age of global value chains); and, cotton (in particular, ending the U.S. trade distortions that deprive a number of LDCs of potential export markets). (This article from Third World Network provides a good summary of the issues.)
Meanwhile, the trade issues taking most governments’ attention are not on the Doha Agenda at all. The WTO agriculture talks do not address the causes of the global food price crisis. There is no readiness to confront distorting biofuels mandates and subsidies; nor to address natural resource limits and climate change, which is directly affecting production and, combined with low global stock levels and poorly regulated commodities exchanges, increasing price volatility. There is no discussion of the changed context, from one of abundance to one of scarcity, a change that leaves many of the WTO rules impotent. There is no clear idea on how to rebalance rules to reflect the emergence of new dominant trade powers (for example, by re-thinking how to differentiate among countries beyond “developed”, “developing” and “least developed” – not least when some OECD members are still considered developing countries in the WTO rules), nor any discussion of the implications of the replacement of state-trading exporters with an expansion of the existing private grain oligopoly, which has further decreased competition and transparency in grain markets.
And yet multilateral trade talks are important—perhaps more important than ever. The high profile regional and plurilateral deals now in discussion (particularly the TPP and the Trans-Atlantic Trade and Investment Partnership) are full of issues transnational companies want and rich country governments think important: more restrictive intellectual property rights; further deregulation of the laws governing services such as banking; freer rules for foreign investment; harmonization of trade standards to facilitate intra-firm trade. They have nothing to say about balancing interests among countries facing very different levels of economic vulnerability. But the rules they develop could very well circle back to become the new norm for trade rules with other countries, and potentially shape the WTO agenda in future. For all of its failings, the WTO is at least a forum in which all countries have a voice in making those decisions, or in pushing hard for a different course.
It is time that governments undertook another stock-taking exercise (as they did before the Seattle Ministerial), salvaging what is worth salvaging from the Doha Agenda but more importantly looking at what the world needs today from its multilateral trade system. Many food movements are understandably focused on building local production and local markets. Some regions are establishing links that will strengthen food security and improve the possibilities for viable and varied agricultural production. But there is a multilateral agenda that requires attention, from climate change to the regulation of oligopolies in international markets. And there are important benefits for the majority of countries (which are neither industrialized nor yet emerging economics), who are not as easily picked off or marginalized in the multilateral system as they are in the often grossly unequal regional deals between rich and poor countries.
So with low expectations but acutely aware that regional rules alone will not be sufficient, IATP is engaging directly in the agriculture agenda and watching the overall balance of the negotiations to see if and where there is any room to manoeuvre. A narrow range of rich country and rich firm interests has scripted the trade agenda for too long. We wish the new Director General, Brazil’s Roberto Azevêdo, well as he begins his four-year term in September. He has an important and difficult task ahead of him: the establishment of trade rules that better serve the public interest.
Posted August 29, 2013 by Karen Hansen-Kuhn
Last week more than 200,000 Colombians converged on Bogota for a nationwide strike to protest free trade, privatization and poverty. According to Common Dreams, the strike began as a protest by campesinos and spread to encompass teachers, miners and other sectors of society.
I have to admit I was surprised to see that farmers had been hit so hard, since prices for grains have been pretty high over the last few years. Back in the early 2000s, when the U.S.-Colombia Free Trade Agreement (FTA)—and the U.S.-Central America FTA, U.S.-Peru FTA, and others—was negotiated, the concern was that U.S.-grown commodities would be dumped by agribusiness at artificially low prices onto foreign markets. This was certainly Mexico’s experience under NAFTA. U.S. corn exports to Mexico quadrupled after NAFTA went into effect, and many small-scale farmers were unable to compete. More than two million Mexicans were driven from their lands.
But that was before the 2008 food price spike, when soaring grain prices sparked food riots around the world and, to some degree, a rethinking of agricultural development policies. Concerns over dumping were replaced by attention to extreme food price volatility and the prospect that prices would continue to increase for the foreseeable future.
So, if prices of key global commodities are higher (although not as high as they were in 2008), why are Colombian farmers still being hurt by the trade deals? I contacted Colombian economist Héctor Mondragón, and he explained that the problem is more complicated than just the price of corn. The economy has shifted away from production of coffee and other goods to mining, which, along with the financial sector, has grown dramatically in recent years. The influx of foreign investment and financial speculation that came in after the U.S.-Colombia FTA was ratified in 2011 (along with similar FTAs with the EU, Canada, Switzerland, South Korea other countries) overwhelmed the economy.
Economists call that problem the “Dutch Disease,” as it mirrors the Netherland’s experience in the 1960s when huge economic inflows resulting from discoveries of natural gas disrupted the local economy, shifting economic activity away from manufacturing, in that case. The inflows of foreign investment caused the currency to appreciate, making exports relatively more expensive, and imports cheaper. In the wake of the trade deals, the Colombian currency has appreciated, so once again imports of grains and other agricultural commodities enter the country at prices that are hard for local farmers to beat.
Mondragón explained that there’s also a bit of the “Cyprus Disease,” as those inflows were coupled with deregulation of the financial sector and massive new speculation. But to really understand what’s going on with agriculture, we have to look at what’s happened under what he calls the “Colombia Disease” of speculation on land. That disease, he explains, is characterized by increasingly high concentration of land ownership, and land grabs, together with the decline of large tracts of farmland, with 16.6 million hectares of arable land now standing idle. Land prices have soared, and government land reform programs have favored big businesses—domestic and foreign—over supposedly less efficient small-scale farmers. In many cases, the investors are just holding onto the land in hopes that it’s value will continue to increase, and making it even harder for smaller-scale farmers to access the land they need for production.
"Years ago Colombian farmers lost the markets for wheat, barley and 70 percent of the corn market to imports," he adds. "Now they are dealing with increases in fertilizer prices, measures to prohibit unregistered seeds, scandals around land grabs by big businesses, along with big increases in imports of potatoes and milk, setting off the current strike and those that are sure to follow later this year.”
Financial deregulation, restrictive new patent protections, along with the trade liberalization that has led to surges in food imports, are all central elements of the FTAs Colombia negotiated with the U.S. and other countries. These characteristics are virtually identical to negotiations that are underway now among other countries involved in the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP, or TAFTA, which very much rhymes with NAFTA). Before surging ahead blindly with further free trade agreements that primarily benefit big financial and corporations, we should carefully review the impacts previous agreements have had on the public good, including farmers and food sovereignty, consumers and health, and control over natural resources and the commons. It’s time to break the cycle of deregulation and expansion of trade and financial flows at all costs through trade deals, and begin rebuilding local food and economic systems around the world.