Winners and Losers of “Free Trade”

NC has reposted a piece by Don Quijones about free trade and its repercussions. In light of the bullshit spouted about the current attempts at sharpening IP regulations, and weakening democracy in the fact of profit, it helps to time and again reconsider the empirical evidence regarding “free trade” agreements. The prime example remains Mexico and NAFTA’s effects (my emphasis):

Post-NAFTA Mexico is as much a poster child of the potential macro-economic benefits of so-called “free trade” as it is of the micro-economic ravages it leaves in its wake. As El Observador Economico reports, the positives cannot be ignored:

Between 1993 and 1998 foreign investment in the country almost tripled.
The number of employees in industry more than doubled in the space of six years.
The total value of Mexico’s exports to the United States rose from 49.4 billion dollars in 1994 to 135 billion dollars in 2000.
Productivity increased by 47 percent between 1994 and 2001.

All of which, on the face of it, sounds impressive – enough to excite even the most impassive economist. But there is another, altogether bleaker side to the story – one, unfortunately, rarely told beyond Mexican borders:

The real value of the minimum wage plummeted by around 20 percent between 1993 and 2001.
Much of the new employment generated was in the assembly of imported component parts for re-export in semi-sweat shop facilities called Maquiladoras. The lure of the maquilas is low wages, a lack of environmental or labour regulations, low taxes, and few if any duties — the sort of conditions that are still hard to find in the more heavily regulated markets of Europe and the U.S. Products produced include apparel, electronic goods and autos.
The percentage of Mexicans living in outright poverty rose from 21 percent of the population in 1994 to 50 percent in 1998.
The exodus of campesinos to cities and the big corporate farms in the North of America and the US has accelerated: in the last 20 years millions of Mexican farmers have had to abandon their land.

He continues to discuss the last point in some more detail:

One of the conditions that former US President Bush and then President Obama put on passing the trade agreement is that Colombia would pass a law to privatise seeds. The government was more than happy to oblige, decreeing that only certified seeds could be sown.

The problem for Colombian farmers is that only big capital – i.e. multinationals – can afford the certification process. As a result, only their seeds can be grown. In the last year thousands of rice farmers have had their seed stock destroyed by police and government officials[.]
For the world’s biggest agribusinesses, free trade provides the perfect pretext to consolidate their hold over the global food chain. Already 75 percent of the global commercial seed market is controlled by six mega-corporations — Monsanto, DuPont, Syngenta, Bayer, Dow, and BASF. The result is that basic crop seeds, which for millennia have been a common good to be shared out and improved among small communities of farmers, now belong firmly in the private hands of U.S. and European conglomerates.

According to Alejandro de Coss, a Mexican internationalist who teaches at the London School of Economics, the result is that large parts of rural Latin American are once again in the process of being colonised – no longer through the actual physical possession of the land, but rather through the seeds grown on it.

In Mexico, the result has been a huge exodus of campesinos from their own lands as well as a decline in the country’s crop diversity – particularly with regard to its staple crop, corn, which was first domesticated eight thousand years ago in the Mexican states of Puebla and Oaxaca.

The country remains the fourth largest corn producer in the world but its 22,000,000 ton annual yield pales in comparison to U.S. growers who, as a result of massive U.S. government subsidies, harvest around 300,000,000 tons each year, accounting for 70 per cent of the world’s maize supply – much of which are now genetically engineered varieties. The result is that a country that once boasted the greatest diversity in corn varieties is now dependent for its own staple crop on the highly unstable international markets, where food speculation is rifer than ever.

However, Mexico and Colombia are far from the only victims of this process. From India to Africa, Asia to South America, smallholders are finding it more and more difficult to plant their own seeds, extracted from the prime produce of last year’s harvest. They are also forbidden from reusing the certified seeds and are forced to take on unpayable debts to keep buying new seeds year in, year out.

In India, more than 100,000 farmers have taken their own life as a result of the ruthless drive to use the country as a testing ground for genetically modified crops — all made possible through a bilateral trade agreement between the Indian government and the U.S. All the while, countless tons of good quality crops, together with the thousands of years of human knowledge that went into their careful selection and improvement, have been destroyed.

This is and remains also the most important argument against GMO seeds – that they can be patented, certified, their reseeding switched off! Not that they are some kind of monsterfood.

This entry was posted in "free trade", geostrategy, GMOs, standards of living. Bookmark the permalink.

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