Credit access

"Many studies (e.g. by the World Bank (12) and the IMF(13)) have shown that the opening of developing countries’ markets to the establishment of foreign banks often leads to the weakening of access to credit for small and medium sized industries, thus stifling domestic economic development. The EU has, in previous years, even made GATS requests that some developing countries remove existing requirement of mandatory lending to small and medium enterprises (SMEs).

Practice shows that small and poor farmers are also left behind by foreign banks and insurance companies. Such practice is in contradiction to a broad agreement in the international community, that increasing agricultural production in developing countries will be a key step towards addressing the root causes of the 2008 food crisis. (14) Improving farmers’ access to credit is one key measure to make that possible. In times of crisis and credit crunch, banks tend to lend less, especially to poor and “risky” farmers, thus further undermining food production and aggravating the food crisis. GATS National Treatment and Most Favoured Nation rules also forbid targeting incentives to those banks that are willing to support small farmers.

The promotion and use of futures trading in key agricultural commodities by the financial industry contributes to the high prices making food unaffordable to the poor. Over the past year, India has banned futures trading in key agricultural commodities over concerns that it has caused sharp increases in the price of food staples like lentils, wheat, and rice. However, such an intervention in financial markets to curb speculations on food staples by India or by any country that makes commitments on these financial services, could be challenged under the GATS dispute settlement. (15)"

From the latest TNI newsletter

Remunicipalisation

While the Arab World looks at how to privatize water, the rest of the world is taking water back under public management:

"In most countries, the expansion of modern water and sanitation systems happened as a result of public ownership and investment in response to increasing demand and public health concerns in urban areas. In the 1990s, however, many countries privatised their water and sanitation services, particularly in the South, as a result of strong pressure from neoliberal mindset governments and international financial institutions, to ‘open’ up national services.

The promises that privatisation would improve the provision of drinking and wastewater services soon faltered. Many of the privatised operations quickly began to show weaknesses as they missed targets for expanding and upgrading networks, introduced excessive tariff increases alongside connection fees which were unaffordable for low-income families. Management activities were not transparent and accountable. As a result numerous contracts with private operators were terminated often following popular unrest. Many cities, regions and even countries have chosen to close the book on water privatisation and instead embarked on remunicipalisation or renationalisation of water delivery, in which the aim is not to return to the pre-privatisation realities but to develop public-water systems that satisfy citizens’ needs.

Remunicipalisation is happening not only at municipal and community levels (such as in France or the US) but also at regional levels (as in Buenos Aires and the Santa Fe provinces in Argentina) and national levels (such as Uruguay and Mali). Around 40 municipalities and urban communities in France have already taken water services back into public hands over the last ten years, resulting in cheaper tariffs and improved services. Also cities in the US, large and small, have remunicipalised their water services as a reaction to poor service and excessive rates. In both countries, some of the private operators used sophisticated and dishonest management and financial practices to increase profits."

Search and destroy

"Compounding the negative impact of adjustment were unfair trade practices on the part of the EU and the United States. Trade liberalization allowed low-priced subsidized EU beef to enter and drive many West African and South African cattle raisers to ruin. With their subsidies legitimized by the WTO’s Agreement on Agriculture, U.S. cotton growers offloaded their cotton on world markets at 20-55% of the cost of production, bankrupting West African and Central African cotton farmers in the process.(2)

These dismal outcomes were not accidental. As then-U.S. Agriculture Secretary John Block put it at the start of the Uruguay Round of trade negotiations in 1986, “the idea that developing countries should feed themselves is an anachronism from a bygone era. They could better ensure their food security by relying on U.S. agricultural products, which are available, in most cases at lower cost.”(3)

What Block did not say was that the lower cost of U.S. products stemmed from subsidies that were becoming more massive each year, despite the fact that the WTO was supposed to phase out all forms of subsidy. From $367 billion in 1995, the first year of the WTO, the total amount of agricultural subsidies provided by developed country governments rose to $388 billion in 2004. Subsidies now account for 40% of the value of agricultural production in the European Union (EU) and 25% in the United States. "

Walden Bello on the destruction of African Agriculture

All rise

"Consumers Lebanon said on Tuesday that the prices of staples and other basic commodities rose by 47.5% in the last two years. Speaking to reporters, the President of Consumers Lebanon, Zuhair Berro, said that part of the rise in the cost of living in Lebanon can be attributed to the worldwide surge in the prices of oil and wheat.

However, Berro accused the government of failing to take any action to help protect consumers. He added that despite a government decision to remove the 5% tariffs on 17 basic items, the prices of these commodities continued to rise."

Lethal combination

"Although Lebanon has large tracts of fertile land and higher than average rainfall for the region, it remains unable to take full advantage of its agriculture sector. Perhaps the underlying reasons for Lebanon's failure to capitalise on its agricultural potential are a combination of failed export reforms, reliance on imports and state subsidies to supply domestic needs. Without significant change, farmers will struggle to reap a richer harvest."

New blog on food crisis

...at least new to me: http://foodcrisis.wordpress.com/

Open sesame

"BRUSSELS - European Union negotiators have initialed a deal to liberalize trade in most farm and fishery products with Egypt, the most important Middle East market for EU produce, the European Commission said on Friday.

The agreement will give EU exporters free and immediate access to the Egyptian market for around 90 percent of agriculture and fisheries products, it said in a statement.

Egypt will continue to apply existing conditions to imports of tobacco, wines and spirits and pig meat but will halve its duties on confectionery, chocolate, pasta and bakery products." (ME online)

The plagues of Egypt

From a dossier on Egypt by Wael Abdel Fateh in Al Akhbar (my summary)

Egypt, the land of the mighty Nile, is thirsty. But not all of Egypt: there is a "thirst belt", which overlaps with the misery belt, and there is a "golf belt" where the rich can go and relax in their $millions apartments, and play golf as well. There, the grass is watered freely while the rest of the country has to drink polluted water, when it can access it. In the "Marina" resort, where powerful and rich people meet, a politician was heard saying: "If things remain as they are, the hungry and thirsty will enter the resorts of the rich and eat their livers".

Meanwhile, and after 56 years of the revolution which eliminated titles and imposed equality between all Egyptians, at least in theory, the Egyptian noblesse is making a comeback. Beik and hanem and bachas are titles that are now commonly used to refer to the rich and powerful and to the members of the ruling class.

Elsewhere, a young man asks his father: "why are we poor?" The father answers: "because I am honest". The son answers: "why should I pay for this?".

Dubai

Awed by the Dubai experience? Read this interview with Mike Davis on Tadamon:

"Mike Davis: Dubai is the capital of an alternate planetary existence for the rich and the very rich. Dubai stands at the intersection of oil rich lands and an almost infinite supply of very cheap labor from South Asia. Although there have been other instant cities in world history, St. Petersburg is an example, never before has there been a plan to build what could be described as a utopian capitalist city.

Half the property and business in Dubai is owed by a single family, in Dubai there are no legal trade unions or electoral processes. Dubai is a city in which every effort is made to build attractive platforms for foreign investors, from media and telecommunications sectors to international financial firms. Every effort has been made to build an attractive city for rich foreigners, including gated communities that advertise supreme lifestyles.

Instead of having any national or city-wide policies, Dubai has created different rights and regulations for different gated enclaves. Within the Internet city for example you have more or less freedom on the Internet but not in the rest of Dubai, or within the financial district you have rules equivalent to the London Stock Exchange. In history there has never been a similar project to build a literally utopian place for international financial markets.

In two-hundred to two-hundred-fifty years of industrial capitalism there isn’t a similar example. Dubai has this ability due to enormous financial resources which leverage this incredible project, in which the ruling family in Dubai has taken what they perceive to be the best features from Singapore, Hong Kong, Disneyland and Las Vegas, literally turning sand into gold with the help of oil profits."

Palestinian water

"Average per capita consumption throughout the West Bank is 66 liters, two-thirds of the minimal amount needed according to the WHO. These figures include water for livestock, meaning that the water consumed for personal use is even less.

In comparison, average daily water consumption in Israeli cities is 235 liters, and 214 liters in local councils, 3.5 times higher than Palestinian consumption in the West Bank." (Thanks Marcy)

And remember, the situation in Gaza is ten times worse.

Judge by yourself

"Whatever scientific merit (if any) may be attached to GM food, the behaviour of Monsanto the corporate bully, is quite another thing. Their operatives, when they are not distributing the ubiquitous pesticide Roundup, function like apostolic disseminators of a creed. That creed, to use an Indian term of reference, is the second Green Revolution. (The first Green Revolution was launched in India 40 years ago.) Some of them go far in US public life – take one of its past employees in the pesticide and agriculture division, current justice of the Supreme Court, Clarence Thomas." (Thanks Kirsten)

Soy Boliviano

"The rise of this agribusiness complex has plundered the natural resources of eastern Bolivia. As the frontier for soybeans advances further into the rainforests, the older depleted lands are either abandoned or turned into extensive cattle grazing pastures. Given the highly mechanized nature of soy farming, there are few employment opportunities in the countryside for either the local indigenous population or for those who migrate from the Andes searching for work. As Miguel Urioste, the director of the Land Foundation in La Paz, explains: "This mono export model -- promoted actively by the World Bank for 15 years -- is a lamentable demonstration of how, those that decide public policies . . . in the third world, do not take into account the enormous environmental costs or the lamentable economic and political effects produced by this model. The monocultivation of soy has concentrated land in a few hands, it has transnationalized property rights, it has impeded new humanely planned settlements, and concentrated thousands of poor peasants without lands to generate wealth, employment and well being."⁵

While Bolivia ranks among the world's ten top soy exporters, the production of domestic foodstuffs by the peasantry has stagnated or declined and the urban population has come to rely more and more on imported grains. Today Bolivia imports sixty-nine percent of its wheat, forty-five percent of its rice, and forty-two percent of its corn.⁶ In 2004, even the World Bank was compelled to admit: "the rural economy is increasingly polarised between the small peasant sector producing foodstuffs, on the one hand, and the agro-enterprise sector producing cash crops for export, on the other.""(Thanks Daniel)

Export water plus

If you read Arabic, this is really worth reading: a report in the economic page of al akhbar on the export plus program that is being reinstated. It is the only "agricultural" subsidies program, it is outside the ministry of agriculture, and it consists in covering part of the costs of exports. The main beneficiaries, in spite of what many say (read the last section), were the big exporters. This is confirmed by the (not so small) farmers interviewed in this article and in the last paragraph of the following article. This other article, also from the economics page of al akhbar (have I mentionned before that it is the best daily in the Arab World?) on the potato farmers crisis. Syria has agreed to allow the transit of Lebanese potatoes in covered trucks (not in fridges) which will reduce the export costs. But read the last 2 paragraphs: farmers pump water from as deep as 700 m to irrigate the potato fields with precious groundwater. The water table has dropped by several hundred meters in the past 30 years. This is the real situation: we cheaply export water in the form of potatoes.

Badael-Alternatives

In Al Akhbar today: Badael-Alternatives. My editorial: National Unity, or how the members of the government and the oppositions are campaigning together to save the privileges of a few exporters benefiting from the Export Plus program. A report on 3 seminars addressing the food crisis and related issues in Lebanon. It is summer, beware of dehydration, says Rana. Argeeleh is a problem in Lebanon: it is harmful to health and pocket says Muhammad Muhsin. And Marianna Yazbeck is back with a short article on Aloysia.

Independence day

In red and white, Michele Sisson, US ambassador to Lebanon. Helping her cut the (US flag?) cake: Fawzi Salloukh, the minister of foreign affairs and member of the opposition Amal block, Ali Bazzi, the head of Amal's foreign relations (also opposition) and on the far end Nehmeh Tohmeh, a member of the Walid Jumblat (loyalist) block. (Official photo by Dalati and Nahra).

Aleppo pepper

"Do you know Aleppo pepper, by the way? You should: it is a dried chili generally sold roughly ground or crushed; it has the sweetness, roundness and perfume of the best kind of sundried tomatoes, but with a substantial kick behind it. It is also beautiful to look at, a rich, warm red that seems to reflect its flavor." (Thanks Leila)

What's Aleppo pepper? Anyone knows?

This is what we struggle for

I'm not a great fan of comparative advantages and of export-oriented agriculture. I am often surprised by how many "leftist" economists I encounter in Lebanon and in the Arab World are totally unaware of the problems surrounding the commodification of food and of export-oriented agriculture. For them, farming is important, regardless of the type of farming and who the beneficiaries are. In Lebanon for instance, most of those interested in agriculture (and well meaning) shower with praise the very modest successes of a couple of NGOs in exporting olive oil. This appears to be the main goal: exporting, preferably to the North. This is regardless of the fact that Lebanon is one of the Mediterranean countries where olive oil consumption is the lowest: 2.4 kg per person per year. Compare with Greece: 20.7 kg per person per year. Instead of trying to export olive oil and to import cheap GMO soy or corn oil, these organizations should promote the consumption of the healthier and tastier olive oil for all Lebanese, rich and poor.

There are tons of evidence that export-oriented agriculture does not work for the poor and that it cause more misery and exploitation. Daniel sent me this article about India:

"After the dry spell in the mid 1960s-early 1970s, making India self-sufficient in food became a rallying call. But instead of basing the methods for accomplishing this on land reform (along with really well informed, ecologically sound extension), the politically driven emphasis on mono-cropping, export for profit, and complex market chains led to an adoption of the U.S. model of agriculture based on a limited number of commodities. This approach relied on an extensive use of artificial petrochemical-based fertilizers and pesticides, with a strong emphasis on the large and very large farmers (size defined in locally relevant terms). With the so-called "liberalization" of the economy in the last 10 years, there has been a large emphasis on export crops, based on the views of economists who believed that it would be good for trade if India were to import many of its basic grains, taking advantage of what economists call "economies of scale", a concept borrowed from industry which ignores the realities of rural/agricultural life."

Here is another one about Egyptian cotton, which I had blogged before, but I find is worth blogging twice. Please read it.

"According to Hamdi Wabid, a campaigner for the Land Centre for Human Rights, an NGO that fights for cotton farmers, the Egyptian cotton we sleep on in the west comes at the end of a chain of hardship and suffering. 'Counting seeds and fertiliser, the cost of starting each year's crop has jumped from zero to hundreds of pounds,' Wabid says. 'At the same time,
cotton prices have plunged, mainly because of oversupply but also because the US, the world's largest cotton producer, provides generous government subsidies to its farmers, allowing them to sell at a far lower cost. This has led many in Egypt to blame the Americans for creating the crisis,' says Wabid.
'Those who are suffering more are the children. You can be assured that any Egyptian cotton you buy in Britain has been picked or processed or tilled by children, some as young as five and six. They have no opportunities to thrive or grow, or even, as children, to have dreams and ambitions.'"

And another one, in French about banana growing in Cameroun:

"Le salaire n'est pas bon, confirme Elysée Mbelle, un autre jeune planteur. Ce n'est pas normal que ce soit la famine ici alors que nous faisons manger les Français." Depuis les émeutes, les salaires ont d'ailleurs reçu un net coup de pouce, le salaire minimum passant à 31 000 francs CFA (46,50 euros) sans les primes, qui le portent à 45 000 francs CFA (67,50 euros), selon la direction de SPM."

"Beaucoup d'employés se font virer parce qu'ils volent des bananes. La direction ne t'en donne pas. Seuls les rebuts sont vendus sur les marchés. Ces gens-là ont voulu se venger." Les conditions de travail (douze heures payées huit selon certains), la rémunération à la tâche, sans considération du temps passé, et la discipline de fer alimentent les frustrations. "Si tu demandes une pause à cause de la chaleur, le chef te dit : "Ou tu y retournes, ou je t'inscris en refus de travail"", rapporte un intérimaire.

Let me know if you need more. Farming is a way of life. Food and land and water are basic human rights. They are not optional. Let it be known: this is what we struggle for.

Flab

In a world where federal corn subsidies and industrial fast foods have transformed Americans into fat-bearing mammals, it's no surprise that petroleum execs would see a kind of logic in harvesting human lard to fuel America's economic engine. (Thanks Leila)

Update on Lebanese Agriculture

Agriculture in Lebanon, a short study by Bassam Hamdar (in Arabic). I will retain the following figures:

It is possible to increase the area of cultivated lands by 25% or an extra 100,000 rainfed ha.

Food costs in Lebanon are $2.5 billions.
Value of agricultural production is $1.2 billions.

Self sufficiency:
Wheat: 20%
Meat: beef 9%, sheep 20%
Milk: 63%
Vegetable oils: 52%

Fruits, vegetables and poultry: 100%

Look elsewhere

Egypt's economic growth has been way higher than the population growth. So please do not just blame population for the growing impoverishment of Egypt. Look instead at how government industries were privatized, and at who controls the wealth. Mustapha Baysouni writes for Al Akhbar.