[OPE-L] Free Trade & International Concentration and Centralization of Capital

From: glevy@PRATT.EDU
Date: Thu Jan 27 2005 - 11:26:35 EST

A report from ActionAid is set to highlight how power in the world
food industry has become concentrated in a few hands.  Can it be
shown, more broadly, that free trade policies have historically
increased the international concentration and centralization of
capital in agriculture, industry, and finance?

In solidarity, Jerry

Free trade leaves world food in grip of global giants
John Vidal in Porto Alegre
Jan. 27, 2005, The Guardian

Global food companies are aggravating poverty in developing countries  by
dominating markets, buying up seed firms and forcing down prices  for
staple goods including tea, coffee, milk, bananas and wheat,
according to a report to be launched today.

As 50,000 people marched through Porto Alegre, in southern Brazil, to
mark the opening of the annual World Social Forum on developing
country issues, the report from ActionAid was set to highlight how  power
in the world food industry has become concentrated in a few  hands.

The report will say that 30 companies now account for a third of the
world's processed food; five companies control 75% of the
international grain trade; and six companies manage 75% of the global
pesticide market.

It finds that two companies dominate sales of half the world's
bananas, three trade 85% of the world's tea, and one, Wal-mart, now
controls 40% of Mexico's retail food sector. It also found that
Monsanto controls 91% of the global GM seed market.

Household names including Nestlé, Monsanto, Unilever, Tesco, Wal-
mart, Bayer and Cargill are all said to have expanded hugely in size,
power and influence in the past decade directly because of the trade
liberalisation policies being advanced by the US, Britain and other  G8
countries whose leaders are meeting this week in Davos.

"A wave of mergers and business alliances has concentrated market  power
in very few hands," the report says.

It accuses the companies of shutting local companies out of the
market, driving down prices, setting international and domestic trade
rules to suit themselves, imposing tough standards that poor farmers
cannot meet, and charging consumers more.

The report says the 85% of all the recent fines imposed on global  cartels
were paid by agrifood companies, with three of them forced to  pay out
$500m to settle price-fixing lawsuits.

"It is a dangerous situation when so few companies control so many
lives," said John Samuel of ActionAid yesterday.

The ActionAid report argues that many food behemoths are wealthier  than
the countries in which they do their business. Nestlé, it says,  recorded
profits greater than Ghana's GDP in 2002, Unilever profits  were a third
larger than the national income of Mozambique and Wal- mart profits are
bigger than the economies of both countries combined.

The companies are also said to be taking advantage of the collapse in
farm prices. Prices for coffee, cocoa, rice, palm oil and sugar have
fallen by more than 50% in the past 20 years.

The report feeds into growing calls at Porto Alegre for the
regulation of multinational food companies. A coalition of the
largest international environmental, trade and human rights groups,
including Greenpeace, Friends of the Earth, Amnesty, Via Campesina  and
Focus on the Global South, yesterday said they would be working  together
to press for corporate accountability.

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