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Ed Webb

How Goldman Sachs Created the Food Crisis - By Frederick Kaufman | Foreign Policy - 0 views

www.foreignpolicy.com/..._sachs_created_the_food_crisis

food markets speculation hunger land agriculture

shared by Ed Webb on 24 Aug 12 - Cached
  • in 1999, the Commodities Futures Trading Commission deregulated futures markets. All of a sudden, bankers could take as large a position in grains as they liked, an opportunity that had, since the Great Depression, only been available to those who actually had something to do with the production of our food
  • After World War II, the United States was routinely producing a grain surplus, which became an essential element of its Cold War political, economic, and humanitarian strategies -- not to mention the fact that American grain fed millions of hungry people across the world
  • Futures markets traditionally included two kinds of players. On one side were the farmers, the millers, and the warehousemen, market players who have a real, physical stake in wheat. This group not only includes corn growers in Iowa or wheat farmers in Nebraska, but major multinational corporations like Pizza Hut, Kraft, Nestlé, Sara Lee, Tyson Foods, and McDonald's -- whose New York Stock Exchange shares rise and fall on their ability to bring food to peoples' car windows, doorsteps, and supermarket shelves at competitive prices. These market participants are called "bona fide" hedgers, because they actually need to buy and sell cereals. On the other side is the speculator. The speculator neither produces nor consumes corn or soy or wheat, and wouldn't have a place to put the 20 tons of cereal he might buy at any given moment if ever it were delivered. Speculators make money through traditional market behavior, the arbitrage of buying low and selling high. And the physical stakeholders in grain futures have as a general rule welcomed traditional speculators to their market, for their endless stream of buy and sell orders gives the market its liquidity and provides bona fide hedgers a way to manage risk by allowing them to sell and buy just as they pleased.
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  • Every time the due date of a long-only commodity index futures contract neared, bankers were required to "roll" their multi-billion dollar backlog of buy orders over into the next futures contract, two or three months down the line. And since the deflationary impact of shorting a position simply wasn't part of the GSCI, professional grain traders could make a killing by anticipating the market fluctuations these "rolls" would inevitably cause. "I make a living off the dumb money," commodity trader Emil van Essen told Businessweek last year. Commodity traders employed by the banks that had created the commodity index funds in the first place rode the tides of profit
  • dozens of speculative non-physical hedgers followed Goldman's lead and joined the commodities index game, including Barclays, Deutsche Bank, Pimco, JP Morgan Chase, AIG, Bear Stearns, and Lehman Brothers, to name but a few purveyors of commodity index funds. The scene had been set for food inflation that would eventually catch unawares some of the largest milling, processing, and retailing corporations in the United States, and send shockwaves throughout the world
  • Not only does the world's food supply have to contend with constricted supply and increased demand for real grain, but investment bankers have engineered an artificial upward pull on the price of grain futures. The result: Imaginary wheat dominates the price of real wheat, as speculators (traditionally one-fifth of the market) now outnumber bona-fide hedgers four-to-one.
  • a problem familiar to those versed in the history of tulips, dot-coms, and cheap real estate: a food bubble
  • when the global financial crisis sent investors running scared in early 2008, and as dollars, pounds, and euros evaded investor confidence, commodities -- including food -- seemed like the last, best place for hedge, pension, and sovereign wealth funds to park their cash. "You had people who had no clue what commodities were all about suddenly buying commodities," an analyst from the United States Department of Agriculture told me. In the first 55 days of 2008, speculators poured $55 billion into commodity markets, and by July, $318 billion was roiling the markets. Food inflation has remained steady since
  • The more the price of food commodities increases, the more money pours into the sector, and the higher prices rise
  • from 2005 to 2008, the worldwide price of food rose 80 percent -- and has kept rising
  • speculation has also created spikes in everything the farmer must buy to grow his grain -- from seed to fertilizer to diesel fuel
  • The average American, who spends roughly 8 to 12 percent of her weekly paycheck on food, did not immediately feel the crunch of rising costs. But for the roughly 2-billion people across the world who spend more than 50 percent of their income on food, the effects have been staggering: 250 million people joined the ranks of the hungry in 2008, bringing the total of the world's "food insecure" to a peak of 1 billion -- a number never seen before.
  • I asked a handful of wheat brokers what would happen if the U.S. government simply outlawed long-only trading in food commodities for investment banks. Their reaction: laughter. One phone call to a bona-fide hedger like Cargill or Archer Daniels Midland and one secret swap of assets, and a bank's stake in the futures market is indistinguishable from that of an international wheat buyer. What if the government outlawed all long-only derivative products, I asked? Once again, laughter. Problem solved with another phone call, this time to a trading office in London or Hong Kong; the new food derivative markets have reached supranational proportions, beyond the reach of sovereign law
  • nervous countries have responded instead with me-first policies, from export bans to grain hoarding to neo-mercantilist land grabs in Africa. And efforts by concerned activists or international agencies to curb grain speculation have gone nowhere. All the while, the index funds continue to prosper, the bankers pocket the profits, and the world's poor teeter on the brink of starvation
Ed Webb

Imperialist appropriation in the world economy: Drain from the global South through une... - 0 views

www.sciencedirect.com/...S095937802200005X

empire analysis history colonialism politics economics economy trade

shared by Ed Webb on 05 Mar 22 - No Cached
  • Unequal exchange theory posits that economic growth in the “advanced economies” of the global North relies on a large net appropriation of resources and labour from the global South, extracted through price differentials in international trade.
  • Our results show that in 2015 the North net appropriated from the South 12 billion tons of embodied raw material equivalents, 822 million hectares of embodied land, 21 exajoules of embodied energy, and 188 million person-years of embodied labour, worth $10.8 trillion in Northern prices – enough to end extreme poverty 70 times over.
  • Historians have demonstrated that the rise of Western Europe depended in large part on natural resources and labour forcibly appropriated from the global South during the colonial period, on a vast scale. Spain extracted gold and silver from the Andes, Portugal extracted sugar from Brazil, France extracted fossil fuels, minerals and agricultural products from West Africa, Belgium extracted rubber from the Congo; and Britain extracted cotton, opium, grain, timber, tea and countless other commodities from its colonies around the world – all of which entailed the exploitation of Southern labour on coercive terms, including through mass enslavement and indenture. This pattern of appropriation was central to Europe’s industrial growth, and to financing the expansion and industrialization of European settler colonies, including Canada, Australia, New Zealand and the United States, which went on to develop similarly imperialist orientations toward the South
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  • Our analysis confirms that unequal exchange is a significant driver of global inequality, uneven development, and ecological breakdown.
  • Today, we are told, the world economy functions as a meritocracy: countries that have strong institutions, good markets, and a steadfast work ethic become rich and successful, while countries that lack these things, or which are hobbled by corruption and bad governance, remain poor. This assumption underpins dominant perspectives in the field of international development (Sachs, 2005, Collier, 2007, Rostow, 1990, Moyo, 2010, Calderisi, 2007, Acemoglu and Robinson, 2012), and is reinforced by the rhetoric, common among neoclassical economists, that free-trade globalization has created an “even playing field”.
  • Emmanuel and Amin argued that unequal exchange enables a “hidden transfer of value” from the global South to the global North, or from periphery to core, which takes place subtly and almost invisibly, without the overt coercion of the colonial apparatus and therefore without provoking moral outrage. Prices are naturalized on the grounds that they represent “utility”, or “value”, or the outcome of “market mechanisms” such as supply and demand, obscuring the extent to which they are determined by power imbalances in the global political economy. Price differentials in international trade therefore function as an effective method of maintaining the patterns of appropriation that once overtly defined the colonial economy, allowing blame for “underdevelopment” to be shifted onto the victims.
  • Historians have demonstrated that the rise of Western Europe depended in large part on natural resources and labour forcibly appropriated from the global South during the colonial period, on a vast scale. Spain extracted gold and silver from the Andes, Portugal extracted sugar from Brazil, France extracted fossil fuels, minerals and agricultural products from West Africa, Belgium extracted rubber from the Congo; and Britain extracted cotton, opium, grain, timber, tea and countless other commodities from its colonies around the world – all of which entailed the exploitation of Southern labour on coercive terms, including through mass enslavement and indenture. This pattern of appropriation was central to Europe’s industrial growth, and to financing the expansion and industrialization of European settler colonies, including Canada, Australia, New Zealand and the United States, which went on to develop similarly imperialist orientations toward the South (e.g., Naoroji, 1902, Pomeranz, 2000, Beckert, 2015, Moore, 2015, Bhambra, 2017, Patnaik, 2018, Davis, 2002).
  • for every unit of embodied resources and labour that the South imports from the North they have to export many more units to pay for it, enabling the North to achieve a net appropriation through trade. This dynamic was theorized by Emmanuel (1972) and Amin (1978) as a process of “unequal exchange”.Emmanuel and Amin argued that unequal exchange enables a “hidden transfer of value” from the global South to the global North, or from periphery to core, which takes place subtly and almost invisibly, without the overt coercion of the colonial apparatus and therefore without provoking moral outrage. Prices are naturalized on the grounds that they represent “utility”, or “value”, or the outcome of “market mechanisms” such as supply and demand, obscuring the extent to which they are determined by power imbalances in the global political economy. Price differentials in international trade therefore function as an effective method of maintaining the patterns of appropriation that once overtly defined the colonial economy, allowing blame for “underdevelopment” to be shifted onto the victims.
  • Following Dorninger et al. (2021), we use a “footprint” analysis of input–output data to quantify the physical scale of raw materials, land, energy and labour embodied in trade between the North and South, looking not only at traded goods themselves but also the upstream resources and labour that go into producing and transporting those goods, including the machines, factories, infrastructure, etc.
  • Grounding our analysis in the physical dimensions of unequal exchange is important for several reasons. First, these resources – raw materials, land, labour and energy – embody the productive potential that is required for meeting human needs (use-value) and for generating economic growth (exchange-value). Physical drain is therefore ultimately what drives global inequalities in terms of access to provisions, as well as in terms of GDP or income (see Hornborg, 2020). Second, this approach allows us to maintain sight of the ecological impacts of unequal exchange. We know that excess energy and material consumption in high-income nations, facilitated by appropriation from the rest of the world, is causing ecological breakdown on a global scale. Tracing flows of resources embodied in trade allows us to determine the extent to which Northern appropriation is responsible for ecological impacts in the South; i.e., ecological debt (Roberts and Parks, 2009, Warlenius et al., 2015, Hornborg and Martinez-Alier, 2016).
  • Due to the growing fragmentation of international commodity chains, monetary databases on bilateral gross trade flows have been criticised for not accurately depicting the monetary interdependencies between national economies (Johnson and Noguera, 2012), i.e., the amount of a countries’ value added that is induced by foreign final demand and international trade relations. Trade in Value Added (TiVA) indicators Johnson and Noguera, 2012, Timmer et al., 2014 are designed to take into account the complexity of the global economy. The TiVA concept is motivated by the fact that, in monetary terms, trade in intermediates accounts for approximately two-thirds of international trade. Imports (of intermediates) are used to produce exports and hence bilateral gross exports may include inputs (i.e., value added) from third party countries (Stehrer, 2012). TiVA reveals where (e.g., in which country or industry) and how (e.g. by capital or labour) value is added or captured in global commodity chains (Timmer et al., 2014).
  • TiVA, which is sometimes referred to as the “value footprint”, is the monetary counterpart of the MRIO-based environmental footprint because both indicators follow the same system boundaries, i.e., all supply chains between production and final consumption of two countries including all direct and indirect interlinkages. Moreover, in contrast to global bilateral monetary trade flows, TiVA is globally balanced, meaning that national exports and imports globally sum up to zero. This is an important feature of the TiVA indicator that facilitates more consistent and unambiguous assessments.
  • for every unit of embodied raw material equivalent that the South imports from the North, they have to export on average five units to “pay” for it
  • For land the average ratio is also 5:1, for energy it is 3:1, and for labour it is 13:1
  • Table 1. Resource drain from the South.ResourceNorth → South flows 2015South → North flows 2015Drain from South in 2015Cumulative drain from South 1990–2015Raw material equivalents [Gt]3.3715.3912.02254.40Embodied land [mn ha]527.421,349.01821.5932,987.23Embodied energy [EJ]21.5543.5121.06650.34Embodied labour [mn py-eq]31.11219.22188.125,956.62
  • in the year 2015 the North’s net appropriation from the South totalled 12 billion tons of raw materials, 822 million hectares of land, 21 exajoules of energy (equivalent to 3.4 billion barrels of oil), and 188 million person-years equivalents of labour (equivalent to 392 billion hours of work). By net appropriation we mean that these resources are not compensated in equivalent terms through trade; they are effectively transferred gratis. And this appropriation is not insignificant in scale; on the contrary, it comprises a large share (on average about a quarter) of the North’s total consumption.
  • significant consequences for the global South, in terms of lost use-value. This quantity of Southern raw materials, land, energy and labour could be used to provision for human needs and develop sovereign industrial capacity in the South, but instead it is mobilized around servicing consumption in the global North.
  • Eight hundred and twenty-two million hectares of land, which is twice the size of India, would in theory be enough to provide nutritious food for up to 6 billion people, depending on land productivity and diet composition
  • material use is tightly linked to environmental pressures. It accounts for more than 90% of variation in environmental damage indicators (Steinmann et al., 2017), and more than 90% of biodiversity loss and water stress (International Resource Panel, 2019). Moreover, as Van der Voet et al. (2004) demonstrate, while impacts vary by material, and vary as technologies change, there is a coupling between aggregate mass flows and ecological impact. Net flows of material resources from South to North mean that much of the impact of material consumption in the North (43% of it, net of trade) is suffered in the South. The damage is offshored.
  • Industrial ecologists hold that global extraction and use of materials should not exceed 50 billion tons per year (Bringezu, 2015). In 2015, the global economy was using 87 billion tons per year, overshooting the boundary by 74% and driving ecological breakdown. This overshoot is due almost entirely to excess resource consumption in global North countries. The North consumed 26.71 tons of materials per capita in 2015, which is roughly four times over the sustainable threshold (6.80 tons per capita in 2015). Our results indicate that most of the North’s excess consumption (58% of it) is sustained by net appropriation from the global South; without this appropriation, material use in high-income nations would be much closer to the sustainable level.
  • In consumption-based terms, the North is responsible for 92% of carbon dioxide emissions in excess of the planetary boundary (350 ppm atmospheric concentration of CO2) (Hickel, 2020), while the consequences harm the South disproportionately, inflicting dramatic social and economic costs (Kikstra et al., 2021b, Srinivasan et al., 2008). The South suffers 82–92% of the costs of climate change, and 98–99% of the deaths associated with climate change (DARA, 2012)
  • Net appropriation of land means soil depletion, water depletion, and chemical runoff are offshored; net appropriation of energy means that the health impacts of particulate pollution are offshored; net appropriation of labour means that the negative social impacts of exploitation are offshored, etc (Wiedmann and Lenzen, 2018). In the case of non-renewable resources there is also a problem of depletion: resources appropriated from the South are no longer available for future generations to use (Costanza and Daly, 1992, World Bank, 2018), which is particularly problematic given that under conditions of net appropriation economic losses are not offset by investments in capital stock (cf. Hartwick, 1977). Finally, the extractivism that underpins resource appropriation generates social dislocations and conflicts at resource frontiers (Martinez-Alier, 2021).
  • the value of resources and labour cannot be quantified in dollars, and there is no such thing as a “correct” price.
  • Prices under capitalism do not reflect value or utility in any objective way. Rather, they reflect, among other things, the (im)balance of power between market agents (capital and labour, core and periphery, lead firms and their suppliers, etc); in other words, they are a political artefact
  • While prices by definition do not reflect value, they do allow us to compare the scale of drain to prevailing monetary representations of production and income in the world economy.
  • Fig. 2 shows that drain from the South in 2015 amounted to $14.1 trillion when measured in terms of raw material equivalents, $5.1 trillion when measured in terms of land, $3.6 trillion when measured in terms of energy and $20.3 trillion when measured in terms of labour.
  • Over the period 1990–2015, the drain sums to $242 trillion (constant 2010 USD). This represents a significant “windfall” for the North, similar to the windfall that was derived from colonial forms of appropriation; i.e., goods that did not have to be produced on the domestic landmass or with domestic labour, and did not have to be bought on the domestic market, or paid for with exports (see Pomeranz, 2000, Patnaik, 2018). While previous studies have shown that the price distortion factor increased dramatically during the structural adjustment period in the 1980’s (Hickel et al., 2021), our data confirms that since the early- to mid-1990’s it has tended to decline slightly. This means that the increase in drain during the period 1990–2007, prior to the global financial crisis, was driven primarily by an increase in the volume of international trade rather than by an increase in price distortion.
  • Table 3 shows that, over the 1990–2015 period, resources appropriated from the South have been worth on average roughly a quarter of Northern GDP.
  • the North’s reliance on appropriation from the South has generally increased over the period (despite a significant drop after the global financial crisis), whereas the South’s losses as a share of total economic activity have generally decreased, particularly since 2003, due to an increase in South-South trading and higher domestic GDP creation or capture within the South, both driven largely by China
  • Aid flows create the powerful impression that rich countries give benevolently to poorer countries. But the data on drain through unequal exchange raises significant questions about this narrative.
  • net appropriation by DAC countries through unequal exchange from 1990 to 2015 outstripped their aid disbursements over the same period by a factor of almost 80
  • for every dollar of aid that donors give, they appropriate resources worth 80 dollars through unequal exchange. From the perspective of aid recipients, for every dollar they receive in aid they lose resources worth 30 dollars through drain
  • The dominant narrative of international development holds that poor countries are poor because of their own internal failings and are therefore in need of assistance. But the empirical evidence on unequal exchange demonstrates that poor countries are poor in large part because they are exploited within the global economy and are therefore in need of justice. These results indicate that combating the deleterious effects of unequal exchange by making the global economy fairer and more equitable would be much more effective, in terms of development, than charity.
  • In an equitable world, the resource trade deficit that the North sustains in relation to the South would be financed with a parallel monetary trade deficit. But in reality, the monetary trade deficit is very small, equivalent to only about 1% of global trade revenues, and fluctuates between North and South. In effect, this means that the North achieves its large net appropriation of resources and labour from the South gratis.
  • The question of sectoral disparities has been moot since the 1980s, however, as industrial production has shifted overwhelmingly to the South. The majority of Southern exports (70%) consist of manufactured goods (data from UNCTAD; see Smith, 2016). Of all the manufactured goods that the USA imports, 60% are produced in developing countries. For Japan it is 70%. We can see this pattern reflected also in the industrial workforce. As of 2010, at least 79% of the world’s industrial workers live in the South (data from the ILO; see Smith, 2016). This shift is due in large part to the rise of global commodity chains, which now constitute 70% of international trade. Between 1995 and 2013, there has been an increase of 157 million jobs related to global commodity chains, and an estimated 116 million of them are concentrated in the South, predominantly in the export manufacturing sector (ILO, 2015). In other words, during the period we analyse in this paper (1990–2015), the South has contributed the majority of the world’s industrial production, including high-technology production such as computers and cars. And yet price inequalities remain entrenched.
  • if Northern states or firms leverage monopoly power within global commodity chains to depress the prices of imports and increase the prices of final products, their labour “productivity” appears to improve, and that of their counterparts declines, even if the underlying production process remains unchanged. Indeed, empirical evidence indicates that real productivity differences between workers are minimal, and cannot explain wage inequalities (Hunter et al., 1990).
  • wage inequalities exist not because Southern workers are less productive but because they are more intensively exploited, and often subject to rigid systems of labour control and discipline designed to maximize extraction (Suwandi et al., 2019). Indeed, this is a major reason why Northern firms offshore production to the South in the first place: because labour is cheaper per unit of physical output (Goldman, 2012).
  • the terminology of “value-added” is a misnomer. In international trade, TiVA does not tell us who adds more value but rather who has more power to command prices. And in the case of global commodity chains, TiVA does not indicate where value is produced but rather where it is captured (Smith, 2016).
  • our analysis reveals that value in global commodity chains is disproportionately produced by the South, but disproportionately captured by the North (as GDP). Value captured in this manner is misleadingly attributed to Northern economic activities
  • rich countries are able to maintain price inequalities simply by virtue of being rich. This finding supports longstanding claims by political economists that, all else being equal, price inequalities are an artefact of power. Just as in a national economy wage rates are an artefact of the relative bargaining power of labour vis-à-vis capital, so too in international trade prices are an artefact of the relative bargaining power of national economies and corporate actors vis-à-vis their trading partners and suppliers. Countries that grew rich during the colonial period are now able to leverage their economic dominance to depress the costs of labour and resources extracted from the South. In other words, the North “finances” net appropriation from the South not with money, but rather by maintaining the prices of Southern resources and labour below the global average level.
  • Patents play a key role here: 97% of all patents are held by corporations in high-income countries (Chang, 2008:141)
  • In some cases, patents involve forcing people in the South to pay for access to resources they might otherwise have obtained much more affordably, or even for free (Shiva, 2001, Shiva, 2016).
  • In the World Bank and the IMF, Northern states hold a majority of votes (and the US holds a veto), thus giving them control over key economic policy decisions. In the World Trade Organization (which controls tariffs, subsidies, and patents), bargaining power is determined by market size, enabling high-income nations to set trade rules in their own interests.
  • ubsidized agricultural exports from the North undermine subsistence economies in the South and contribute to dispossession and unemployment, placing downward pressure on wages. Militarized borders preclude easy migration from South to North, thus preventing wage convergence. Moreover, structural adjustment programs (SAPs) imposed by the World Bank and IMF since the 1980s have cut public sector salaries and employment, rolled back labour rights, curtailed unions, and gutted environmental regulations (Khor, 1995, Petras and Veltmeyer, 2002).
  • SAPs, bilateral free trade agreements, and the World Trade Organization have forced global South governments to remove tariffs, subsidies and other protections for infant industries. This prevents governments from attempting import substitution, which would improve their export prices and drive Northern prices down. Tax evasion and illicit financial flows out of the South (which total more than $1 trillion per year) drain resources that might otherwise be reinvested domestically, or which governments might otherwise use to build national industries. This problem is compounded by external debt service obligations, which drain government revenue and require obeisance to economic policies dictated by creditors (Hickel, 2017). In addition, structural dependence on foreign investors and access to Northern markets forces Southern governments and firms to compete with one another by cutting wages and resource prices in a race to the bottom.
  • structural power imbalances in the world economy ensure that labour and resources in the South remain cheap and accessible to international capital, while Northern exports enjoy comparatively higher prices
  • Cheap labour and raw materials in the global South are not “naturally” cheap, as if their cheapness was written in the stars. They are actively cheapened
  • the analysis obscures class and geographic inequalities within countries and regions, which are significant when it comes to labour prices as well as resource consumption. The high levels of resource consumption that characterize Northern economies are driven disproportionately by rich individuals and affluent areas, as well as by corporations that control supply chains, and enabled by internal patterns of exploitation and unequal exchange in addition to drain through trade (Harvey, 2005). For example, there are marginalized regions of the United States that serve as an “internal periphery” (Wishart, 2014). It would also be useful to explore the gender dynamics of unequal exchange within countries. These questions cannot be answered with our data, however.
  • This research confirms that the “advanced economies” of the global North rely on a large net appropriation of resources and labour from the global South, extracted through induced price differentials in international trade. By combining insights from the classical literature on unequal exchange with contemporary insights about global commodity chains and new methods for quantifying the physical scale of embodied resource transfers, we are able to develop a novel approach to estimating the scale and value of resource drain from the global South. Our results show that, when measured in Northern prices, the drain amounted to $10.8 trillion in 2015, and $242 trillion over the period from 1990 to 2015 – a significant windfall for the North, equivalent to a quarter of Northern GDP. Meanwhile, the South’s losses through unequal exchange outstrip their total aid receipts over the period by a factor of 30.
  • support contemporary demands for reparations for ecological debt, as articulated by environmental justice movements and by the G77
  • True repair requires permanently ending the unequal distribution of environmental goods and burdens between the global North and global South, restoring damaged ecosystems, and shifting to a regenerative economic system.
  • It is clear that official development assistance is not a meaningful solution to global poverty and inequality; nor is the claim that global South countries need more economic liberalisation and export-oriented market integration. The core problem is that low- and middle-income countries are integrated into the global economy on fundamentally unequal terms. Rectifying this problem is critical to ensuring that global South countries have the financial, physical and human resources they need to improve social outcomes.
  • democratize the institutions of global economic governance, such as the World Bank, IMF and WTO, so that global South countries have more control over trade and finance policy.
  • end the North’s use of unfair subsidies for agricultural exports, and remove structural adjustment conditions on international finance, which would help mitigate downward pressure on wages and resource prices in the South while at the same time enabling Southern countries to build sovereign industrial capacity
  • a global living wage system, and a global system of environmental regulations, would effectively put a floor on labour and resource prices
  • Reducing North-South price differentials would in turn reduce the scale of the North’s net resource appropriation from the South (in other words, it would reduce ecologically unequal exchange), thus reducing excess consumption in the North and the ecological impacts that it inflicts on the South.
  • Structural transformation will only be achieved through political struggle from below, including by the anti-colonial and environmental justice movements that continue to fight against imperialism today
Ed Webb

Toblerone triangle change upsets fans - BBC News - 0 views

www.bbc.com/uk-37904703

chocolate Britain UK Brexit trade commodities socialmedia

shared by Ed Webb on 08 Nov 16 - No Cached
  • Ed Webb on 08 Nov 16
     
    The cost of some key commodities globally has risen, including cocoa. The weak Pound no doubt makes them even more expensive, although the specifics are not clear and have not been made so by the company. Note that a US company selling a Swiss brand in the UK provoked this social media storm: globalization in action.
Ed Webb

African countries not ready to implement free trade from January | Financial Times - 0 views

www.ft.com/...90-d38e-4d08-a1e1-0e7f5e19be30

Africa trade economy commodities development

shared by Ed Webb on 29 Dec 20 - No Cached
  • Fifty four African nations have committed to join AfCFTA but of the 33 countries to have ratified the agreement so far many lack the customs procedures and infrastructure to facilitate tariff-free trade, said Wamkele Mene, secretary-general of the AfCFTA secretariat.
  • “If you don’t have the roads, if you don’t have the right equipment for customs authorities at the border to facilitate the fast and efficient transit of goods . . . if you don’t have the infrastructure, both hard and soft, it reduces the meaningfulness of this agreement.”
  • In 2019, 14.4 per cent of official African exports went to other African countries, a small proportion compared with the 52 per cent in intra-Asian trade and 73 per cent between European nations in the same year
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  • “We want to move Africa away from this colonial economic model of perpetually being an exporter of primary commodities for processing elsewhere,”
  • goods traded within Africa were more processed than the raw materials exported from the continent to China, India, Europe and other major trading partners
  • “Policymakers have understood that, although trade on the continent is limited, this is value-added trade,” he said. “This is where the jobs are coming from, as opposed to trade with the rest of the world, which is mostly commodities.”
  • Jeffrey Peprah, chief executive of Volkswagen, Ghana, said he hoped eventually to export cars assembled in Accra to other west African countries.
  • For the agreement to work, one western diplomat said the free trade zone must benefit producers in smaller, poorer countries as well as those in more industrialised parts of the continent. Many countries saw the free trade area as a way of boosting their exports but few had embraced the corollary that they would need to import more, the diplomat said.
Ed Webb

Chocolate: Worth its weight in gold? - Features, Food & Drink - The Independent - 0 views

www.independent.co.uk/...ts-weight-in-gold-2127874.html

IR trade commodities development Africa chocolate

shared by Ed Webb on 10 Nov 10 - No Cached
  • The world could run out of affordable chocolate within 20 years as farmers abandon their crops in the global cocoa basket of West Africa, industry experts claim.
  • Farmers in the countries that produce the bulk of cocoa bought by the multinationals who control the market have found the crop a bitter harvest. The minimal rewards they have historically received do not provide incentives for the time-consuming work of replanting as their trees die off – a task that usually means moving to a new area of canopied forest and waiting three to five years for a new crop to mature. "It's hard to maintain production at high levels in a particular plot of land every time, because of pest problems that eat away at the yields and the farms need to be rejuvenated," explains Thomas Dietsch, research director of ecosystem services at the Earthwatch Organisation. "Although research into new varieties and better management methods could solve those problems, the other challenge is that cocoa is competing for agricultural space with other commodities like palm oil – which is increasingly in demand for biofuels."
  • Despite price rises on the trading floor, precious little reaches the smallholders who make up 95 per cent of growers, according to Mr. Lass, a former Cadburys trader and ethical sourcing advisor who has co-authored a book on the cocoa industry.
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  • some farmers in West Africa have turned to child labour to compensate for the manpower shortage
  • , chocolate will go back to being what it used to be – a rarefied treat
  • A spokesman from Cadburys doesn't deny the shortage of cheaper cocoa, but suggests scarcity might be averted through Fair Trade initiatives. "Together with other manufacturers and the wider cocoa industry, we have been working on a number of agricultural initiatives to both increase and improve yields," he says. "Our move into Fair Trade was a separate step, to both pay a better price to farmers, and to encourage the next generation of cocoa farmers to stay within the industry."
  • Divine Chocolate, a Ghanaian manufacturer that is 45 per cent owned by a cooperative of 45,000 cocoa farmers. "The Fair Trade system helps ensure that the value of farming is delivered directly to the farmers and their communities," says its managing director Sophi Tranchell.
Ed Webb

Donald Trump Is the First Demagogue of the Anthropocene - The Atlantic - 0 views

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climate environment politics conflict EU US USA migration refugees analysis opinion

shared by Ed Webb on 19 Oct 16 - No Cached
  • Jürgen Scheffran, a professor of geography at the University of Hamburg, has been investigating whether climate change makes armed conflict more likely for more than a decade. In 2012, he worked on a team that analyzed all 27 empirical studies investigating the link between war and climate change.“Sixteen found a significant link between climate and conflict, six did not find a link, and five found an ambiguous relationship,” he told me. He described these numbers as inconclusive. Trying to prove that climate change is linked to war, he said, would be like trying to prove that smoking causes cancer with only one available case study.
  • there is only one world, and not a million worlds, in which the temperature is rising, and you cannot associate a single event—like a single hurricane or a single conflict—to climate change. It’s a statistical problem, and we don’t have enough data yet
  • the U.S. Department of Defense already considers global warming a “threat multiplier” for national security. It expects hotter temperatures and acidified oceans to destabilize governments and worsen infectious pandemics
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  • Martin O’Malley was mocked for suggesting that a climate-change-intensified drought in the Levant—the worst drought in 900 years—helped incite the Syrian Civil War, thus kickstarting the Islamic State. The evidence tentatively supports him. Since the outbreak of the conflict, some scholars have recognized that this drought pushed once-prosperous farmers into Syria’s cities. Many became unemployed and destitute, aggravating internal divisions in the run-up to the war
  • Scheffran underlined these climate connections but declined to emphasize them. “The Syrian War has so many complex interrelated issues—and most of them are political and economic—that the drought is just one contributing factor to the instability in the region,”
  • it’s all about the exogenous shock. We were all interested in, to what extent does a big event like a flooding or a drought undermine society, or trigger a conflict outbreak?
  • Heatwaves, droughts, and other climate-related exogenous shocks do correlate to conflict outbreak—but only in countries primed for conflict by ethnic division. In the 30-year period, nearly a quarter of all ethnic-fueled armed conflict coincided with a climate-related calamity. By contrast, in the set of all countries, war only correlated to climatic disaster about 9 percent of the time
  • climate disaster will not cause a war, but it can influence whether one begins
  • Models predict that northern Africa and the Levant, both already drought-prone, will dry out significantly over the course of the century. On the phone, Schleussner also cited southern Africa and south-central Asia as regions to watch. (It’s no coincidence that some of the largest, longest wars this century have occurred in those places.)
  • a drought-and-flood-fueled armed conflict near the Mediterranean Basin could send people toward Western Europe in the hundreds of millions
  • “I wouldn’t say that there would be a mass migration to Europe, but I would expect to see a large number of people being displaced within Africa,”
  • There is literally, in legal parlance, no such thing as an environmental refugee,” says Edward Carr. “To meet the international standard for refugee, a changing environment is not a forcing. It doesn’t count.”
  • When would you attribute the decision to move to changes in the climate? Does a place have to be dry for five years? For 10 years? Does someone have to have three children die, and then they decide to move?
  • Climate change could push Western politics toward demagoguery and authoritarianism in two ways, then. First, it could devastate agricultural yields and raise food prices; destroy coastal real estate and wash away family wealth; transform old commodities into luxury goods. Second, it could create a wave of migration—likely from conflict, but possibly from environmental ruination—that stresses international reception systems and risks fomenting regional resource disputes.
  • it could erode people’s sense of security, pushing them toward authoritarianism
  • Like the CEO in the 1950s who predicted that America would see flying cars and three-day workweeks by the year 1999, I’ve assumed that every ongoing trend line can be extrapolated out indefinitely. They can’t. The actual future will be far stranger.
  • climate change must be mitigated with all deliberate speed. But he also suggests certain cultural mechanisms. Some Americans may favor more restrictive immigration policies, but—in order to withstand against future waves of mass migration (and humanely deal with the victims of climate change)—racist fears must be unhooked from immigration restrictionism. In other words, as a matter of survival against future authoritarians, white supremacy must be rejected and defeated.
  • Improving the United States’s immune response to authoritarian leadership—a response that could be repeatedly tested in the century to come—can follow from weaving its civic fabric ever tighter. I don’t know what this will look like, exactly, for every person. But here are some places to start: Volunteer. Run for local or state office. Give to charity (whether due to religion or effective altruism). Organize at work. Join a church or a community choir or the local library staff. Make your hometown a better place for refugees to settle. Raise a child well.
  • climate realists have always split their work between mitigation—that is, trying to keep the climate from getting worse—and adaptation—trying to protect what we already have
Ed Webb

Coronavirus measures could cause global food shortage, UN warns | Food security | The G... - 0 views

www.theguardian.com/...-global-food-shortage-un-warns

food security UK Britain US USA pandemics trade agriculture labor UN FAO

shared by Ed Webb on 30 Mar 20 - Cached
  • Protectionist measures by national governments during the coronavirus crisis could provoke food shortages around the world, the UN’s food body has warned.
  • a shortage of field workers brought on by the virus crisis and a move towards protectionism – tariffs and export bans – mean problems could quickly appear in the coming weeks, Maximo Torero, chief economist of the UN Food and Agriculture Organisation, told the Guardian
  • Kazakhstan, for instance, according to a report from Bloomberg, has banned exports of wheat flour, of which it is one of the world’s biggest sources, as well as restrictions on buckwheat and vegetables including onions, carrots and potatoes. Vietnam, the world’s third biggest rice exporter, has temporarily suspended rice export contracts. Russia, the world’s biggest wheat exporter, may also threaten to restrict exports, as it has done before, and the position of the US is in doubt given Donald Trump’s eagerness for a trade war in other commodities.
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  • “Trade barriers will create extreme volatility,” warned Torero. “[They] will make the situation worse. That’s what we observe in food crises.”
  • problems could start to be seen within weeks and intensify over the following two months as key fruit and vegetables come into season
  • “Fruit and vegetables are also very labour intensive, if the labour force is threatened because people can’t move then you have a problem.”
  • “We need to have policies in place so the labour force can keep doing their job. Protect people too, but we need the labour force. Major countries have yet to implement these sorts of policies to ensure that food can keep moving.”
  • Countries such as the UK, with a sinking currency and high level of imports, are also likely to see food price rises unless the government takes action or retailers absorb some of the costs
  • Individuals can also play an important role, by avoiding panic buying and hoarding of food, and cutting down on food waste. Buying too much fresh farm produce that then goes off before it can be eaten will just exacerbate food supply problems, he said. “Individuals should only buy what they need to avoid food waste.”
  • In the UK, some farming leaders have called for a “land army” of workers to replace a shortfall of workers that could reach 80,000, according to one estimate, if the 60,000 seasonal workers recruited from abroad in normal years are prevented from coming, and if some British workers fall ill.
  • Andre Laperriere, executive director of Global Open Data for Agriculture and Nutrition, which provides data on food and agriculture, said the government must make plans to ensure the food supply chain functioned smoothly.“Empty shelves in supermarkets should not be much of a concern,” he said. “It is not a supply problem – it is a logistics problem. There is enough supply for all, as long as everyone stays calm and stops hoarding. We may tend to waste food if we hoard more than required, and hoarding would also artificially increase food prices because of the pressure on the supply chain.”
  • “The food sector comes under the critical infrastructure sector, along with healthcare and emergency services,”
Ed Webb

Outgrowing growth: why quality of life, not GDP, should be our measure of success - The... - 0 views

thecorrespondent.com/...5755293390-151d5c4e

analysis opinion economy growth globalization sustainability climate energy development

shared by Ed Webb on 25 Mar 20 - Cached
  • The old fantasy that market mechanisms will somehow magically solve the climate crisis has been thoroughly dashed, and a new consensus is emerging: we need coordinated government action on a massive scale. 
  • Climate scientists are warning that it’s not feasible for high-income nations to transition to renewables fast enough to stay within the carbon budget for 1.5C, or even 2C, if they continue to pursue economic growth at the usual rates. Why? Because more growth means more energy demand, and more demand makes it all the more difficult to roll out enough renewable energy capacity. According to a team of scientists based in Canada,
  • Our dogged insistence on economic growth is making this vital task much more difficult than it needs to be. It’s like choosing to fight a life-or-death battle while going uphill, blindfolded, with both hands tied behind your back. We are voluntarily sabotaging our chances at success. 
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  • if we want a decent shot at climate stability, high-income nations will have to shift to post-growth economic principles
  • Post-growth thinking is starting to trickle into policy, too. Jacinda Ardern, the prime minister of New Zealand, captured headlines in 2019
  • Economists have long assumed that we need growth to improve people’s lives. But it turns out there’s no empirical evidence for this argument. Beyond a certain point, which high-income countries have long since surpassed, the relationship between GDP and human wellbeing completely breaks down.
  • dozens of countries beat the US in life expectancy with only a fraction of the income
  • universal public services are significantly more cost-efficient than their private counterparts. Spain spends $2,300 per person on healthcare,
  • The reason that GDP growth tends not to deliver the outcomes that we might expect is because the vast majority of it goes straight into the pockets of the rich. They are the real beneficiaries of growth. In the United States, the incomes of the richest 1% have more than tripled since the 1970s,
  • growthism
  • We can accomplish our social goals right now, without any growth at all, simply by sharing what we already have more fairly, and by investing in generous public goods. It turns out justice is the antidote to the growth imperative – and key to solving the climate crisis.
  • The less energy we use, the easier it is to accomplish a rapid transition to renewables. This is perhaps the single most important lesson that climate science has taught us in the past few years.
  • Think of all the energy that’s needed to extract and produce and transport all of the material commodities that the economy churns out each year. Think of the mining, the logging, the factories, the packaging, the container ships, the warehouses, the retail outlets and the waste disposal facilities. The material economy is a giant energy-sucking machine. By reducing the material "throughput" of our economy – the amount of stuff we produce and consume – we can reduce our energy demand. 
  • The key thing to grasp is that a huge chunk of material production in our economy is intended, literally, to be wasted. Firms desperate to overcome the limits of saturated markets resort to all sorts of devious tactics to artificially increase turnover. Take planned obsolescence, for example. The lifespan of household appliances like refrigerators and washing machines has plummeted over the past few decades.
  • Research by US sociologists has revealed that advertising expenditures have a direct impact
  • We like to think of capitalism as a system that’s rational and efficient when it comes to meeting human needs. But in some respects, it’s exactly the opposite. In pursuit of constant growth, firms resort to intentional inefficiencies. This might be rational from the perspective of profits, but from the perspective of human need, and from the perspective of ecology, it is a kind of madness. It is madness in terms of human labour, too. Think about the millions of hours that are poured into producing stuff that’s designed to break down, or that people don’t actually need in the first place.
  • We can legislate for long-term warranties, rights to repair, and mandatory take-back schemes. We can regulate marketing expenditures, and we can liberate public spaces from ads telling us to buy even more – both offline and online. The gains from this could be enormous. Think about it: if clothes and refrigerators and smartphones last twice as long, we will consume half as many. That’s half the extraction, half the shipping, half the warehouses, half the transport, half the waste – and half the energy it takes to power it all. 
  • There are also a number of other steps we can take. We can shift from private cars to public transport. We can ban food waste by supermarkets and farms. We can cut single-use packaging. And we can choose to scale down ecologically destructive and socially less necessary industries, such as SUVs,
  • But, you might ask, what about jobs? As we scale down unnecessary industrial activity, won’t that cause unemployment to rise? Under normal circumstances, yes. But ecological economists have a surprisingly simple solution to this: shorten the working week. Add a job guarantee to the mix (a policy that happens to be resoundingly popular)
  • What’s exciting about this move is that it has a substantial positive impact on wellbeing. Studies in the US have found that people who work shorter hours are happier than those who work longer hours, even when controlling for income. And it has a big impact on energy demand, too. If the United States were to reduce its working hours to the levels of western Europe, its energy use would decline by a staggering 20%. 
  • Public interest in post-growth economics has soared over the past year as the climate crisis worsens. With fires blazing through Australia and the Amazon, floods swamping northern England, droughts driving migration, and record heatwaves searing across Antarctica, people realise that the status quo has us hurtling toward disaster, and they’re increasingly open to new ideas. In the 2020s, we can expect that the climate movement will rally around the Green New Deal and a vision for a completely new economy. 
Ed Webb

Coronavirus and food supply: Visa bottleneck raises labor concerns - Los Angeles Times - 0 views

www.latimes.com/...s-agriculture-food-supply-visa

pandemics food labor US USA California foodsecurity security

shared by Ed Webb on 19 Mar 20 - Cached
  • California’s nearly $50-billion agricultural industry is bracing for a potential labor shortfall that could hinder efforts to maintain the nation’s fresh food supply amid the widening coronavirus outbreak.The immediate concern centers on a backlog in the recruitment of foreign guest workers because of the virus-related shutdown of consul offices processing agricultural H2-A visas in Mexico.
  • fears highlight a gap in the Trump administration’s market-centered approach to keeping vital industries running, which includes numerous measures aimed at supporting aid, credit and the major commodity crops in the nation’s heartland. There has been little done to address the labor-intensive fresh food crops that form the backbone of California agriculture.
  • Assurance from USDA and State were not enough to satisfy growers, shippers and contractors in California, who have been pressing for more clear answers as the scope of the pandemic comes into focus. The state has faced years of labor shortages caused by the aging of the local workforce, immigration crackdowns, improvements in job prospects in Mexico and other factors.“We don’t have enough H-2A workers coming across in normal times,”
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  • “A halt or a drastic slowdown in processing visas will have an immediate domino effect of the domestic food supply of this country,” said David Scaroni, vice president of Fresh Harvest, the country’s largest private contractor of H-2A workers. “No emergency declaration or short term provision will change this fact.”
  • “We believe because of what’s planted and what’s going to be harvested that we can meet the demand and maintain the continuity of the food supply,” Valadez said. “The question is the labor equation. The crops are going to be there. But what are we going to be able to do to get the crops out of the ground?”
  • labor contracting surges dramatically as produce shifts from the winter desert regions of California and Arizona and gets underway along the central coast. That region hosts the bulk of the state’s strawberry production and much of its spring and summer leafy greens, broccoli and cauliflower, among other crops.
  • Any shortfall or slowdown, however, would have a cascade effect across production, harvest, processing and distribution within weeks, Scaroni said. “Plants already in the ground do not know that there is a pandemic occurring. It is crucial to keep this process going as close to the prior normal to ensure a stable food supply for the coming months.”
  • deep, short-term dependency within crops and harvest areas
  • There is no evidence that contact with produce is contributing to the spread of coronavirus, federal health and safety agencies have said.
  • “Historically, farmworkers are so used to not having healthcare they just put up with being sick,” said Armando Elenes, secretary-treasurer of the United Farm Workers. “They’re going to go to work, and on the way to work, they’ll be in a car with four, five or six workers. So ‘social distancing’? Forget that.”
  • An agriculture industry source said operations dependent on food-service clients could suffer irreparable economic harm. The inability of the retail side to absorb the unused supply could leave a paradox of empty bins in grocery stores while food rots in the fields.
  • Rabobank Research predicts that effects of the pandemic will last several months. It already has affected parts of the food economy few think about, such as the boxes it’s packed in — cardboard production largely halted in China in January and February, driving up prices.
  • Wholesalers report that unusually heavy rains have created an “extreme” market for many produce items, including carrots, peppers, squash, potatoes and cauliflower. California’s citrus industry has had to slow or pause harvest during the prolonged rains of the last week, according to California Citrus Mutual. The industry had hoped to overcome most of the supply imbalances as it shifted production north and into additional states. Then the pandemic hit.
Ed Webb

Beyond Oil: Lithium-Ion Battery Minerals and Energy Security - Foreign Policy Research ... - 0 views

www.fpri.org/...y-minerals-and-energy-security

energy China resources commodities technology climate trade OPEC Saudi KSA Russia oil

shared by Ed Webb on 11 Mar 21 - No Cached
  • Should the mass adoption of electric vehicles occur, access to reliable and affordable sources of minerals like cobalt, graphite, lithium, manganese, and nickel, which are used in modern electric-vehicle batteries, will come to occupy a larger share of energy security concerns, especially since one country has already gained control over much of the world’s production and processing of those minerals
  • oil has remained abundant and affordable, despite major production disruptions during the Arab Spring from 2010-2012, in Libya from 2013-2016, and in Venezuela after 2017. In fact, oil prices had dropped 60 percent from their 2008 highs by early 2020, even before the COVID-19 pandemic had made a dent in the global economy.
  • falling oil prices throughout the 2010s may have lulled Western policymakers into believing that the Russian Federation, whose economy is heavily reliant on oil and natural gas exports, would become more docile. It did not; instead, it continued to modernize its military and intimidate its neighbors
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  • OPEC and Russia bargained for months, but talks finally broke down after Moscow refused to limit its oil production to help stabilize oil prices in the wake of the slump in global oil demand caused by the COVID-19 pandemic. Calculating that it could hurt Russia enough to force it back to the negotiating table, Saudi Arabia boosted its daily oil output by 20 percent, flooding the market with oil. Not to be intimidated, Russia responded with a short-term increase in its own oil output (possibly to strike back at Saudi Arabia or to force some American shale-oil companies out of business or both). As a result, oil prices collapsed. The futures price for West Texas Intermediate crude touched a remarkable -$37 per barrel. Although beneficial for oil consumers, the Russia-Saudi Arabia oil price war was a reminder of the influence that state-driven oil producers still had over the world’s energy security.
  • a single country, China, has gained control over much of the world’s production and processing of the cobalt, graphite, lithium, manganese, and nickel used in lithium-ion batteries, the type of electricity-storage devices favored by electric-vehicle manufacturers today.
  • Chinese companies now control almost half of the DRC’s cobalt output, which constitutes over two-thirds of the world’s production. Perhaps of greater concern, China has come to dominate the refining and processing of those minerals. Eighty percent of the cobalt sulphates and oxides used for lithium-ion battery cathodes are processed in China.
  • China’s monopoly can be largely attributed to its relatively low energy costs and less stringent environmental regulations.
  • Though China controls a smaller share of the world’s production of lithium than that of other minerals, it has been buying up stakes in lithium mines around the globe.
  • Moving up the value chain, it is expected to build 101 of the 136 lithium-ion battery manufacturing plants that are currently planned over the next decade
  • n 2010, China abruptly restricted its rare-earth metal exports to Japan, nominally to protect the environment. But after a lengthy review, the World Trade Organization ruled against China’s restrictions. Since then, worries about relying on China as a strategic-minerals supplier have continued to grow. Sometimes, China feeds those fears. In one 2019 incident, China’s state-run Global Times flaunted the country’s dominance over rare-earth metals as a strategic weapon against other countries with the headline “China gears up to use rare-earth advantage.” Such not-so-veiled threats from government-linked media only fan suspicions that China will behave no better than Russia or Saudi Arabia—and possibly worse.
  • In 2019, the U.S. Department of State launched the Energy Resources Governance Initiative to “promote resilient and secure energy resource mineral supply chains” for all kinds of renewable energy and battery storage technologies.  The initiative’s membership has grown to include Australia, Botswana, Canada, Peru,
  • the world appears to be swapping its old dependency on OPEC and Russia, a fractious bunch that until recently was losing power to American oil-shale upstarts, for a new one on China, a single country with a one-party government
Ed Webb

Africa's Choice: Africa's Green Revolution has Failed, Time to Change Course | IATP - 0 views

www.iatp.org/africas-choice

Africa food security agriculture aid development globalization trade analysis opinion sustainability

shared by Ed Webb on 29 Jul 20 - No Cached
  • My research has shown that as the Green Revolution project reaches its 2020 deadline, crop productivity has grown slowly, poverty remains high, and the number of hungry people in the 13 countries that have received priority funding has risen 30% since 2006. Few small-scale farmers have benefited. Some have been thrown into debt as they try to pay for the high costs of the commercial seeds and synthetic fertilizer that Green Revolution proponents sell them. This disappointing track record comes in spite of $1 billion in funding for AGRA and $1 billion per year in subsidies from African governments to encourage their farmers to buy these high-priced inputs.
  • For the last 14 years, governments and donors have bet heavily, and almost exclusively, on the Green Revolution formula of commercial inputs, fossil-fuel-based fertilizers and agro-chemicals. That gamble has failed to generate agricultural productivity, even as the continent has seen a strong period of economic growth. Rural poverty remains high. Hunger is rampant, with the United Nations warning that Africa could see a 73% surge in undernourishment by 2030 if policies don’t change
  • agroecology, with its innovative combination of ecological science and farmers’ knowledge and practices, can restore degraded soils, make farms more resilient to climate change, improve food security and nutrition by growing and consuming a diversity of crops, all at a fraction of the cost — to farmers and to African governments — of the Green Revolution approach
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  • AGRA, initiated in 2006, heralded a new campaign to bring the kind of input-intensive agriculture to Africa that had failed to take hold on the continent when the first Green Revolution swept through much of Asia and Latin America in the 1960s and 1970s.
  • AGRA worked with governments to speed the development of high-yield commercial seeds designed for Africa’s wide range of soils and climates and to facilitate the delivery to farmers of those seeds and the inorganic fertilizers that would make them grow.
  • Many warned that it was seeking to impose Western technologies inappropriate for the continent’s soils, farmers and food systems. Some decried the lack of consultation with African farmers on the nature of the interventions.9 Others pointed out the serious flaws in the first Green Revolution: water supplies depleted and contaminated with chemical runoff; farmers indebted due to high input costs while yields declined after their initial increases; and the loss of crop and diet diversity as Green Revolution crops took over the countryside
  • African farm groups like the Alliance for Food Sovereignty in Africa (AFSA) also warned of the loss of food sovereignty, the ability of communities and nations to freely choose how they wanted to feed themselves, as large commercial firms could come to dominate local markets backed by new government policies designed to ensure market access.
  • Only one country, Ethiopia, shows anything resembling the combination of yield growth and hunger reduction Green Revolution proponents promised, with a 73% increase in productivity and a 29% decrease in the number of hungry. Note, however, that neither of these is on track to meet AGRA’s goal of doubling productivity (100% increase) and halving the number of hungry (which would be a 50% decrease). Ghana is the only other AGRA country that shows decent productivity growth with some decrease in hunger. Malawi achieved relatively strong yield growth but only a small reduction in undernourishment.
  • These data suggest that Green Revolution programs have not produced a productivity boom through intensification but rather an extensification onto new lands. The promotion of extensification is a serious contradiction for Green Revolution proponents. The explicit goal of “sustainable intensification” is to minimize pressure on land and water resources while limiting further greenhouse gas emissions. To the extent Green Revolution programs are encouraging extensification, they are at odds with national and donor government commitments to mitigate climate change. Depending on individual countries’ land endowments, extensification can be a serious problem. Rwanda, for example, is densely populated and does not have vast tracts of uncultivated arable land.
  • Evidence would suggest that the main beneficiaries are likely not the poorest or most food-insecure farmers but rather a growing number of medium-scale farmers who have access to more land and are already integrated into commercial networks. Only a fraction of such farmers come up from the ranks of smallholders; many are new investors in farming from urban elites. One study showed that a tiny fraction of smallholders is likely to become commercial farmers.18
  • Cassava, a key staple in Nigeria, Mozambique, Uganda, Tanzania and many other AGRA countries, saw a 6% decline in yields. Overall, roots and tubers, which include nutritious crops such as sweet potatoes, experienced a 7% decline in yields. Groundnuts, another critical staple source of protein in many countries, saw an alarming 23% drop in yields.
  • The Staple Crop Index shows that Rwanda’s apparent success in maize has come at the expense of more comprehensive food crop productivity.
  • The total number of undernourished in AGRA’s 13 countries has increased from 100.5 million to 131.3 million, a 30% increase, from before AGRA to 2018. Only Ethiopia, Ghana and Mali report a significant decline in the absolute number of chronically hungry residents
  • One of the negative consequences of the Green Revolution focus on maize and other commodity crops is the declining importance of nutritious and climate-resilient crops like millet and sorghum, which have been key components in healthy diets. These are rarely supported by African governments or AGRA; meanwhile, input subsidies and supports for maize and other favored crops provide incentives for farmers to decrease the cultivation of their own crop varieties
  • AGRA seems to be feeding Africa’s worrisome trend toward locking in path dependency on input-intensive agriculture, much to the detriment of smallholder farmers
  • Unlike industrial-scale farmers in developed countries, their path has not yet been determined; there remain opportunities to chart paths different from the high-input agriculture model promoted by AGRA.
  • Agroecology is one of the systems giving farmers the kinds of innovation they need, farming with nature to promote the soil-building practices that Green Revolution practices often undermine. Building on farmers’ knowledge of local conditions and food cultures, multiple food crops are grown in the same field. Compost, manure and biofertilizers — not fossil-fuel-based fertilizer — are used to nourish fields. Biological pest control decreases pesticide use. Researchers work with farmers to improve the productivity of their seeds rather than replacing them with commercial varieties farmers need to buy every year and douse with fertilizer to make them grow.25 AFSA has documented the effectiveness of agroecology, now widely promoted among its member organizations as a key step toward food sovereignty.26 Such initiatives also achieve productivity increases more impressive than those achieved by Green Revolution programs. One University of Essex study surveyed nearly 300 large ecological agriculture projects across more than 50 poor countries and documented an average 79% increase in productivity with decreasing costs and rising incomes.27 Such results far surpass those of the Green Revolution.
  • It is time for international donors and African governments to change course, to shift their agricultural development funding toward the kinds of low-input sustainable farming that many small-scale farmers in Africa are pioneering under the banner of agroecology. With substantial support, like that provided to Green Revolution programs, agroecology can be Africa’s food future
Ed Webb

unctad.org | Africa could gain $89 billion annually by curbing illicit financial flows - 0 views

unctad.org/...newsdetails.aspx

Africa development economy finance crime smuggling UN UNCTAD trade

shared by Ed Webb on 29 Sep 20 - No Cached
  • Every year, an estimated $88.6 billion, equivalent to 3.7% of Africa’s GDP, leaves the continent as illicit capital flight, according to UNCTAD’s Economic Development in Africa Report 2020.
  • these outflows are nearly as much as the combined total annual inflows of official development assistance, valued at $48 billion, and yearly foreign direct investment, pegged at $54 billion, received by African countries
  • From 2000 to 2015, the total illicit capital flight from Africa amounted to $836 billion. Compared to Africa’s total external debt stock of $770 billion in 2018, this makes Africa a “net creditor to the world”
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  • These outflows include illicit capital flight, tax and commercial practices like mis-invoicing of trade shipments and criminal activities such as illegal markets, corruption or theft.
  • IFFs represent a major drain on capital and revenues in Africa, undermining productive capacity and Africa’s prospects for achieving the Sustainable Development Goals (SDGs).
  • in African countries with high IFFs, governments spend 25% less than countries with low IFFs on health and 58% less on education
  • In Africa, IFFs originate mainly from extractive industries and are therefore associated with poor environmental outcomes.
  • The report shows that curbing illicit capital flight could generate enough capital by 2030 to finance almost 50% of the $2.4 trillion needed by sub-Saharan African countries for climate change adaptation and mitigation
  • Of the estimated $40 billion of IFFs derived from extractive commodities in 2015, 77% were concentrated in the gold supply chain, followed by diamonds (12%) and platinum (6%).
  • Specific data limitations affected efforts to estimate IFFs. Only 45 out of 53 African countries provide data to the UN International Trade Statistics Database (UN Comtrade) in a continuous manner allowing trade statistics to be compared over time.   The report highlights the importance of collecting more and better trade data to detect risks related to IFFs, increase transparency in extractive industries and tax collection.
  • Regional knowledge networks to enhance national capacities to tackle proceeds of money laundering and recover stolen assets, including within the context of the African Continental Free Trade Area (AfCFTA), are crucial in the fight against corruption and crime-related IFFs
  • Tax evasion is at the core of the world's shadow financial system. Commercial IFFs are often linked to tax avoidance or evasion strategies, designed to shift profits to lower-tax jurisdictions.
  • Nigeria’s President Muhammadu Buhari said: “Illicit financial flows are multidimensional and transnational in character. Like the concept of migration, they have countries of origin and destination, and there are several transit locations. The whole process of mitigating illicit financial flows, therefore, cuts across several jurisdictions.”
Ed Webb

Africa in the age of a new "Cold" War - by W. Gyude Moore - 0 views

gyudemoore.substack.com/...a-in-the-age-of-a-new-cold-war

Africa politics US USA analysis China development aid infrastructure

shared by Ed Webb on 21 Oct 23 - No Cached
  • In much of Africa, at least going by their leaders’ statements, there is a revulsion toward anything that forces a choice “for” or “against”. For many of these African countries, there was no “cold” war. Largely protected from the civil wars, murders, coups d’etat and breakdown of social order that wreaked havoc across the then “third world”, westerners are comfortable with referring to the period as a “cold” war, not because they do not acknowledge the proxy wars in former colonies, but because Western countries were not kinetic theaters. Having suffered no direct deaths and destruction, it’s not unreasonable to look favorably upon that period – a luxury many Africans cannot afford.
  • On current trends, over 80 percent of the world’s extreme poor will live in Africa by 2030. Intra-Africa trade has declined from 17 percent in the 1990s to 12.1 percent today. Foreign policy is a function of the domestic demands and the immediate environment. There is thus no incentive for African states to pursue a foreign policy of exclusion. China surpassed the United States as Africa’s largest trading partner 14 years ago. Two-way trade between China and Africa reached $282 billion last year, an 11% increase YoY. At about $40 billion, two-way trade between the US and Africa is about a fifth of China-Africa trade. It is difficult to imagine a material reduction in that economic relationship even under threat of US “punishment”.
  • The rise in China’s influence across lower- and middle-income countries did not come on the strength of Chinese ideology or the compelling logic of Chinese governance model – it has come on China’s ability to meet pressing needs in those economies, mainly infrastructure
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  • The US is still the world leader in supporting human capital development across the world. As we celebrate 20 years of PEPFAR history, it is important to recognize what an unrivaled achievement it has been. A world without PEPFAR is one of total carnage across the African continent. Over $100 billion in the fight against aids over those twenty years is the largest ever disbursement by any nation for the eradication of a single disease. US support through bilateral and multilateral channels for health, education and other social programs are crucial to the provision of those services across the developing world. It is the assumption that these acts are an argument for themselves that has left the US struggling for a narrative to “counter” its rivals. An estimated  $20  of the $55 billion commitment to Africa over the next three years will go toward health care – including pandemic preparedness and vaccine manufacturing. Without that scale of investment, we will measure the cost in lives and livelihoods across the continent. US human capital investment is thus complementary to China’s  hard infrastructure expertise. The insistence that one is better than the other or that China should reap no benefit (influence or otherwise) is ridiculous.
Ed Webb

The Ukraine War: A Global Crisis? | Crisis Group - 0 views

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shared by Ed Webb on 06 Mar 22 - Cached
  • The Ukraine conflict may be a matter of global concern, but states’ responses to it continue to be conditioned by internal political debates and foreign policy priorities.
  • China has hewed to a non-position on Russian aggression – neither condemning nor supporting the act, and declining to label it as an invasion – while lamenting the current situation as “something we do not want to see”. With an eye to the West, Beijing abstained on rather than vetoing a Security Council resolution calling on Russia to withdraw from Ukraine, and reports indicate that two major Chinese state banks are restricting financing for Russian commodities. Beijing now emphasises the principles of territorial integrity and sovereignty in its statements, a point that had either been absent from earlier statements or more ambiguously discussed as “principles of the UN Charter”.
  • the worldview that major powers can and do occasionally break the rules
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  • Beijing’s opposition to U.S. coalition building and expansion of military cooperation with Indo-Pacific countries. Overall, Beijing’s instinct is to understand the Ukraine crisis largely through the lens of its confrontation with Washington.
  • Beijing will want to ensure its position is not overly exposed to Western criticism and to safeguard its moral standing in the eyes of developing countries
  • Khan returned home with little to show from the trip, the first by a Pakistani prime minister in over two decades. He signed no agreements or memoranda of understanding with his Russian counterpart. Widening Western sanctions on Russia have also sunk Pakistani hopes of energy cooperation with Moscow, casting particular doubt on the fate of a proposed multi-billion-dollar gas pipeline project.
  • “military-technical cooperation”, which has resulted in more than 60 per cent of India’s arms and defence systems being of Russian origin
  • India also depends on Russia to counterbalance China, which has become its primary security and foreign policy concern, especially given its unresolved border tensions with Beijing. With Pakistan, India’s main rival, already close to China and cosying up to Russia, India’s worst fear is that China, Pakistan and Russia will come together
  • Relations with Washington are already strained largely because of Islamabad’s seemingly unconditional support for the Afghan Taliban. To give his government diplomatic space, Khan has sought to forge closer ties with Moscow. Those efforts could not have come at a less opportune time.
  • When Russia invaded Ukraine, India immediately came under the spotlight as at once a consequential friend of Moscow and a country traditionally keen to portray itself as the world’s largest democracy and a champion of peace. The U.S. and European countries pressured India not to side with Moscow and the Ukrainian ambassador in New Delhi pleaded for India to halt its political support for Russia. Yet under Prime Minister Narendra Modi, India has responded to the invasion with the blunt realism of a rising, aspirational power that does not want to get caught between Russia and what Modi calls the “NATO group”. India chose the well-trodden non-alignment path and hid behind diplomatic language with a not-so-subtle tilt toward Russia.
  • concerned that the fallout from the war could lead Putin to increase arms sales to anti-Western proxies along its borders, chiefly Syria and Hizbollah in Lebanon, or step up electronic measures to disrupt NATO operations in the Mediterranean Sea, affecting Israel’s own navigation systems. Thus far, Russia has assured Israel that it will continue coordination on Syria, though reiterating that it does not recognise Israeli sovereignty in the Golan Heights, which Israel occupied in 1967 and later annexed
  • The Gulf Arab countries have so far adopted an ambiguous position on the Russian aggression in Ukraine. As close U.S. partners that also have increasing ties to Russia, they sit between a rock and a hard place, unwilling to openly antagonise either side. They have landed in this conundrum because of what they perceive as a growing U.S. withdrawal from the Middle East. In response, they embarked on an effort to diversify their security relations, moving away from sole reliance on Washington. Russia is one of these new partners.
  • No Gulf power wants to give the impression of siding with the Kremlin, for fear of aggravating the U.S. – their primary security guarantor. But as international support for Ukraine and anger at those seen to support (or at least not publicly oppose) Russia grows, the damage may already have been done: the U.S. and its European allies were appalled at the Gulf states’ reticence to get in line with immediate condemnations of the Russian invasion
  • despite Iran’s own experience of losing large swaths of territory to Czarist Russia in the nineteenth century and facing Soviet occupation during and immediately after World War II, the Islamic Republic today can claim few major allies beyond Russia. Tehran sees few upsides in breaking ranks with Moscow. In comparison to the possible results of provoking the Kremlin with anything less than fulsome support, the diplomatic opprobrium it may receive from the U.S. and Europe is of little consequence.
  • Israel has substantive relations with both Russia and Ukraine: Israeli Prime Minister Naftali Bennett has spoken to both Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy since the war began, and has offered to act as mediator; Israel sees itself as, in effect, sharing a border with Russia to its north east in Syria, relying on Putin’s continued tacit approval of its airstrikes on Iranian targets there; large Jewish and Israeli populations reside in both Russia and Ukraine and over 1.5 million Russian and Ukrainian expatriates live in Israel; and Israel is a major U.S. ally and beneficiary that identifies with the Western “liberal democratic order”.
  • Israel has offered humanitarian aid to Ukraine but has refused to sell it arms or provide it with military assistance.
  • African leaders and elites generally oppose sanctions, seeing them as blunt tools that tend to punish the general population more than national leaders. In the meantime, African officials are concerned that the war will have a deleterious impact on the continent’s economies and food security, both by driving up energy prices and by restricting grain supplies from Russia and Ukraine (a particular concern after a period of poor rainfall and weak harvests in parts of the continent). These shocks are liable to be severe in African countries that are still only beginning to recover from the downturn prompted by COVID-19, although oil producers such as Nigeria, Congo and Equatorial Guinea may benefit from a hike in energy prices.
  • President Zelenskyy is the only elected Jewish head of state outside Israel. He lost family in the Holocaust. As such, Israel’s silence on Putin’s antisemitic rhetoric, such as his claim to be “denazifying” Ukraine with the invasion, is noteworthy. That said, Israel has some track record – vis-à-vis Hungary and Poland, for example – of placing what its leaders view as national security or foreign relations concerns above taking a strong stand against antisemitism.
  • In contrast to Russia, with which Pakistan’s commerce is miniscule, the U.S. and EU states are its main trading partners. The war in Ukraine could further undermine Pakistan’s economy. The rise in global fuel prices is already fuelling record-high inflation and putting food security at risk, since before the invasion Ukraine provided Pakistan with more than 39 per cent of its wheat imports. With a trade deficit estimated by one analyst at around $40 billion, Islamabad’s reliance on external sources of funding will inevitably grow. A Russia under heavy sanctions will be in no position to assist. In such a scenario, Pakistan’s powerful military, which Khan depends on for his own political survival, could question his foreign posture.
  • Since 2014, Turkish defence companies have been increasingly engaged in Ukraine, and in 2019 they sold the country drones that Ukrainians see as significant in slowing the Russian advance.
  • On 27 February, Ankara announced that it would block warships from Russia and other littoral states from entering the Black Sea via the Bosporus and Dardanelles Straits as long as the war continues, in line with the Montreux Convention (though Russian vessels normally based in Black Sea ports are exempt from the restriction, under the convention’s terms). But it also requested other states, implicitly including NATO members, to avoid sending their ships through the straits, in an apparent effort to limit the risks of escalation and maintain a balanced approach to the conflict.
  • Some fear, for instance, that Russia and its Syrian regime ally will ratchet up pressure on Idlib, the rebel-held enclave in Syria’s north west, forcing large numbers of refugees into Turkey, from where they might try to proceed to Europe. This worry persists though it is unclear that Russia would want to heat up the Syrian front while facing resilient Ukrainian resistance.
  • A prolonged war will only exacerbate Turkey’s security and economic concerns, and if Russia consolidates control of Ukraine’s coastline, it will also deal a significant blow to Turkey in terms of the naval balance of power in the Black Sea. It is likely that Turkey will draw closer to NATO as a result of this war, and less likely that Turkey will buy a second batch of S-400 surface-to-air missiles from Russia
  • Kenya, currently a non-permanent member of the UN Security Council, has taken a more strident stance in opposition to Russia’s invasion than most non-NATO members of the Council. This position springs in part from the country’s history. Nairobi was one of the strongest supporters of a founding principle of the Organisation of African Unity (OAU) prescribing respect for territorial integrity and the inviolability of member states’ colonial-era borders.
  • As in many African countries, a deep current of public opinion is critical of Western behaviour in the post-Cold War era, emphasising the disastrous interventions in Iraq and Libya, as well as the double standards that many Kenyans perceive in Washington’s democracy promotion on the continent.
  • What Nairobi saw as Washington’s endorsement of the 2013 coup in Egypt particularly rankled Kenyan authorities, who took an especially vocal public position against that putsch
  • Kenya will also push for the strengthening of multilateralism in Africa to confront what many expect to be difficult days ahead in the international arena. “We are entering an age of global disorder”, Peter Kagwanja, a political scientist and adviser to successive Kenyan presidents, told Crisis Group. “The African Union must band together or we will all hang separately”.
  • longstanding solidarity between South Africa and Russia. In the Soviet era, Moscow offered South Africans support in the anti-apartheid struggle and actively backed liberation movements across southern Africa.
  • Although just over half of African states backed the UN General Assembly resolution on Ukraine, many governments in the region have responded to the war with caution. Few have voiced open support for Russia, with the exception of Eritrea. But many have avoided taking strong public positions on the crisis, and some have explicitly declared themselves neutral.
  • Ghana, which joined the UN Security Council in January, has consistently backed the government in Kyiv. The West African bloc, the Economic Community of West African States (ECOWAS), released a statement condemning Russia’s actions. Nonetheless, not all ECOWAS members voted for the General Assembly resolution. Mali, which has drawn closer to Russia as France pulled its military forces out of the country, abstained. Burkina Faso did not vote, perhaps reflecting the fact that Russia watered down a Security Council statement condemning the January coup in Ouagadougou.
  • Russia has many friends in Africa due in part to the Soviet Union’s support for liberation movements during the anti-colonial and anti-apartheid struggles. Many also appreciated Moscow’s strident opposition to the more recent disastrous Western interventions in Iraq and Libya. Furthermore, a number of African leaders studied in the Soviet Union or Eastern Bloc countries and Moscow has done a good job of maintaining these ties over the years. Numerous African security figures also received their training in Russia.
  • The Ukraine conflict is a major problem for Turkey. It threatens not only to damage Ankara’s relations with Moscow, but also to hurt the Turkish economy, pushing up energy costs and stopping Russian and Ukrainian tourists from visiting Turkey. Some analysts estimate that a decline in tourism could mean up to $6 billion in lost revenue.
  • Since the invasion began, Bolsonaro’s affinities with Moscow have exposed the divisions within his hard-right government. From the outset, Brazil’s foreign ministry has vowed to maintain a position of neutrality, urging a diplomatic solution. But a day after the invasion, Hamilton Mourão, the vice president and a retired army general, said “there must be a real use of force to support Ukraine”, arguing that “if the Western countries let Ukraine fall, then it will be Bulgaria, then the Baltic states and so on”, drawing an analogy to the conquests of Nazi Germany. Hours later, Bolsonaro said only he could speak about the crisis, declaring that Mourão had no authority to comment on the issue.
  • Calls for neutrality nevertheless enjoy traction in Brazil. Within the government, there is concern that Western sanctions against Moscow will harm the economy, in particular its agricultural sector, which relies heavily on imports of Russian-made fertilisers. Brazil’s soya production, one of the country’s main sources of income, would suffer considerably from a sanctioned Russia.
  • Mexico depends on the U.S for its natural gas supply, and the prospect of rising prices is spurring the government to consider other means of generating electricity
  • Relations between Russia and Venezuela flourished under the late president, Hugo Chávez, who set the relationship with Washington on an antagonistic course. Under Maduro, Venezuela’s links to Russia have intensified, especially through the provision of technical military assistance as well as diplomatic backing from Moscow after Maduro faced a major challenge from the U.S.-linked opposition in early 2019.
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