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STILL HUNGRY

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Title: STILL HUNGRY


1
STILL HUNGRY!
  • What's wrong in the food market and food
    production?

Sostenibilità, commercio equo, comunicazione
Monica Di Sisto vice presidente
2
Some evidences of the food crisis and more
  • At the World Food Summit in 1996, when there were
    an estimated 830 million hungry people,
    governments pledged to halve the number by 2015.
    Many now predict that the number will instead
    increase by 50 to 1.2 billion threatened by 4
    crises environmental, financial, economic and
    social crisis.
  • Fao (Sofa 2008) says that The real food price
    index began rising in 2002, after four decades of
    predominantly declining trends, and spiked
    sharply upwards in 2006 and 2007.
  • By mid-2008, real food prices were 64 percent
    above the levels of 2002.
  • Vegetable oil prices have risen twice as fast as
    average incomes since 2000, and other commodity
    prices have also risen substantially relative to
    incomes wheat by 61 percent, maize by 32 percent
    and rice by 29 percent.
  • These rapid increases have led to a substantial
    loss of purchasing power.

3
The food production is growing worldwide
4
The food production is growing worldwide/2
5
What about trade?
  • Global food-import expenditures, in value terms,
    are forecast to reach US1 035 billion dollars in
    2008, 26 higher than the previous peak in 2007.
  • The bulk of the anticipated growth in the world
    food import bill would come from higher
    expenditures on rice (77 percent), wheat (60
    percent) and vegetable oils (60 percent).
  • Import bills for livestock products are expected
    to register smaller increases, owing to moderate
    rises in global prices together with subdued
    trade.
  • Higher international commodity prices are
    responsible for most of the increase, but freight
    costs, which have almost doubled for many routes,
    also contribute.
  • Among economic groups, the most economically
    vulnerable countries are set to bear the highest
    burden in the cost of importing food, with total
    expenditures by least-developed countries and
    low-income food-deficit countries expected to
    climb 37 percent and 40 percent, respectively,
    from 2007, after having risen almost as much in
    the previous year.
  • The sustained rise in imported food expenditures
    for these vulnerable country groups is such that,
    on current expectations, by the end of 2008 their
    annual food import basket could cost four times
    as much as it did in 2000.

6
Export still a dream for LDCs
7
Imports still growing for LDCs
8
A fairy tale the International Trade
Organisation
  • The World Bank and the International Monetary
    Fund (IMF) were set up at a meeting of 43 winner
    countries of the II World War held in Bretton
    Woods, New Hampshire, USA in July 1944.
  • Their aims were to help rebuild the shattered
    postwar economy and to promote international
    economic cooperation. The original Bretton Woods
    agreement also included plans for an
    International Trade Organisation (ITO)..
  • The Ito has been ratified in 1948 during the
    United Nation Conference in LAvana participated
    by 56 countries (32 were poor countries).
  • The Charter provided for the establishment of the
    ITO, and set out the basic rules for
    international trade and other international
    economic matters. The ITO Charter, however, never
    entered into force while repeatedly submitted to
    the US Congress, it was never approved.

John Maynard Keynes and Harry Dexter White at the
Bretton Woods Conference
9
The Gatt and then
  • On December 6, 1950 President Truman announced
    that he would no longer seek Congressional
    approval of the ITO Charter. In the absence of an
    international organization for trade, a General
    Agreement on Trade and Tariffs (GATT) reduced
    trade barriers through progressive rounds of
    negotiations till 1995.
  • The 40 years GATT agreement reduced tariffs,
    introduced anti-dumping policies, tackled non
    trade barriers (as quality standards). The
    protections go down by 40.
  • The GATT still exists as the WTO's umbrella
    treaty for trade in goods. In fact, the
    agreements fall into a simple structure with six
    main parts an umbrella agreement (the Agreement
    Establishing the WTO) agreements for each of
    the three broad areas of trade that the WTO
    covers goods and investment (the Multilateral
    Agreements on Trade in Goods including the GATT
    1994 and the TRIMS), services (GATS), and
    intellectual property (TRIPS) dispute settlement
    (DSU) and reviews of governments' trade policies
    (TPRM).

10
The World Trade Organisation
  • Before GATT's 40th anniversary, its members
    concluded that the GATT system was straining to
    adapt to a new globalizing world economy. In
    response to the problems identified in the 1982
    Ministerial Declaration (structural deficiencies,
    spill-over impacts of certain countries' policies
    on world trade GATT could not manage etc.), the
    eighth GATT round known as the Uruguay Round
    was launched in September 1986, in Punta del
    Este, Uruguay.
  • It was the biggest negotiating mandate on trade
    ever agreed the talks were going to extend the
    trading system into several new areas, notably
    trade in services and intellectual property, and
    to reform trade in the sensitive sectors of
    agriculture and textiles all the original GATT
    articles were up for review.
  • The round was supposed to end in December 1990,
    but the US and EU disagreed on how to reform
    agricultural trade and decided to extend the
    talks. Finally, In November 1992, the US and EU
    settled most of their differences in a deal known
    informally as "the Blair House accord", and on
    April 15 1994, the deal was signed by ministers
    from most of the 123 participating governments at
    a meeting in Marrakesh, Morocco.
  • The agreement, driven by Clinton think thanks,
    established the World Trade Organization, which
    came into being upon its entry into force on
    January 1, 1995, and replaced GATT as an
    international organization. It is widely regarded
    as the most profound institutional reform of the
    world trading system.

11
Trade in agriculture is growing
  • Spurred by a 14 per cent growth in prices,
    agricultural exports in 2007 expanded by 19.5 per
    cent in dollar terms in 2007, the highest growth
    rate since 2000.
  • Europe, which accounts fr 46 per cent of world
    exports of agricultural products, boosted exports
    by 19 per cent.
  • Asia, the second-largest supplier with a share of
    19 per cent, increased its exports of
    agricultural products by 20 per cent, a rate
    unmatched since 2000.
  • Exports from North America, the third-largest
    supplier, rose by 17 per cent. Its share of world
    trade has been progressively declining, from 21
    per cent in 2000 to 16 per cent in 2007, due to
    the below world average export growth during this
    period (6 per cent against 11 per cent for the
    world).
  • South and Central America registered its highest
    growth rate since 2000 (23.4 per cent).
  • Africa?

12
Trade is growing more than production
13
But what are wetalking about?
The Wto is trying to apply to agricultural
products that are mainly traded in internal
markets, rules designed by a so called
international market
14
Share of agricultural products in world trade
  • Fruit and Vegetables 1.4
  • Cereals and preparation 1.1
  • Oilseeds, veg. oil, and oil cakes1.0
  • Meat and preparation0.8
  • Coffee, tea, cocoa, and spices 0.6
  • Milk and products and eggs 0.5
  • Total 5.4

15
FAO explain trade myts free tradefair trade
  • Between 1999 and 2002 FAO undertook a series of
    23 country case studies to evaluate the impact of
    the WTO Agreement on Agriculture (AoA) on
    agricultural trade and food security in
    developing countries.
  • The objectives of these studies were to assess
    the extent to which the AoA commitments had led
    to changes in domestic agricultural policy, to
    evaluate the impact on trade flows (imports and
    exports) of developing countries and to assess
    whether implementing the AoA commitments had had
    any impact on food security.
  • An important finding was that for most of the
    countries in the sample, the implementation of
    AoA commitments did not imply any major change to
    domestic agricultural policy, including trade
    policy. The main reason was that most of the
    countries had implemented during the 1980s and
    early 1990s unilateral reforms including the
    liberalization of international trade, often as
    part of the conditionality of IMF/WB adjustment
    loans.
  • Some of these were bound as part of their
    multilateral commitments in WTO Uruguay Round.

16
Different countries similar experiences
  • The 15 countries selected are representative of
    different regions of the world and different
    stages of development, with the main
    concentration on low-income countries that are
    likely to be at greater risk of food insecurity.
  • They range from developing countries with large
    economies (e.g. China and India) to those that
    are amongst the smallest (e.g. Guyana).
  • Eleven of the countries remain at a per capita
    income of less than 1 000/year, many
    significantly (e.g. Malawi). Over the period of
    reforms, per capita GDP has fallen in seven of
    the countries (all African) and increased in the
    remaining countries, particularly so in the
    selected Asian and Latin American countries.
  • The agricultural share of GDP in these countries
    ranges from under 10 percent (Chile, Peru) to
    over 40 percent (Cameroon, Tanzania). Whereas
    this share would be expected to decrease as an
    economy develops, it has increased in five of the
    selected countries. In some, this has been the
    result of relatively high agricultural growth
    rates and relatively weak growth in other
    sectors while in others, growth in all sectors
    has been disappointing.
  • Sometimes agriculture has grown rapidly (Chile in
    the 1980s, Malawi and Guyana in the 1990s) at
    others, it has cushioned an otherwise declining
    economy (Nigeria, Guyana and Peru in the 1980s
    Cameroon in the 1990s). The sample also shows
    that sustained rapid growth in agriculture is
    possible, if not typical. Of the 30 observations
    (two time periods and fifteen countries), in six
    cases agriculture grew by more than 4.5 percent
    per annum, and in six more it grew by at least
    3.5 percent. in all the selected countries there
    has been a decline in the share of the labour
    force employed

17
From policies to market
  • The key agricultural sector policy and
    institutional reforms in the countries studied
    include the followings
  • elimination of state monopolies on agricultural
    marketing in specified inputs and outputs.
    Sometimes the monopoly had controlled both
    internal and external trade, and in other cases
    either one or the other only.
  • elimination of price controls on foods.
    Interpretation of the effects of reforms is
    complicated by the fact that pricing reforms were
    sometimes ambiguous. For example, in Kenya price
    controls on sugar, maize and wheat were replaced
    with a set of floor prices and variable import
    levies designed to enforce the floor prices.
  • elimination of pan-territorial pricing and
    support prices for farmers
  • elimination of subsidies on agricultural inputs
  • privatization or closure of state agricultural
    banks, or reduction of their lending activities
    (along with elimination of credit subsidies and
    restructuring of loan portfolios)
  • privatization or closure of state-owned
    agroprocessing and storage facilities and of
    state agricultural marketing boards and trading
    companies.

18
Why do it happened?
  • One significant motivation for economic policy
    reform was the slowdown of growth in the 1980s
    accompanied by growing debt and the poor
    performance of traditional export markets.
  • Many of the countries in the study had
    experienced periods of relatively rapid economic
    growth in the 1960s and 1970s, but economic
    deterioration had emphasized the need for policy
    reforms in more recent decades. Cameroons
    economy grew at 7 percent per annum between 1970
    and 1987 before subsequently declining. The
    Tanzanian economy grew at an annual rate of 6
    percent in the 1960s, as did Ugandas, whose
    balance of payments was also in surplus, but
    where national income declined in the 1970s.
    Malawi, China and Guatemala experienced a
    long-term annual growth rate of 5 percent or more
    between 1960 and 1982. Kenyas growth rate was in
    excess of 5.5 percent during that period but then
    dropped markedly.
  • Sometimes the most evident cause of economic
    decline was internal conflict (e.g. Uganda in the
    1970s, Guatemala in the 1980s). More often, the
    proximate causes of crises were macroeconomic
    imbalances that became a drag on the economy
    (e.g. Kenya, India, Peru), unsustainable exchange
    rates (Nigeria), and the gradual but definite
    undermining of economic efficiency as a result of
    interventionist policies.
  • In some cases the reforms were precipitated by a
    specific crisis in the economy, often signalled
    by a spike in inflation, shortages of foreign
    exchange and imported goods, declines in export
    commodity prices, a worsening of unemployment and
    underemployment, or a combination of these
    occurrences

19
Barriers off, and then?
  • Some of the many reasons for heterogeneity in
    production responses to free market, have to do
    with changing world market conditions, but some
    havent. Fao states that
  • The role of public institutions in the supply of
    inputs and the marketing of crops has been left
    to the private sector. The efficiency and
    capability of the private sector to fill this
    role has been impaired by several factors. ...
    there is no incentive for committing resources
    for longer term investment in such things as
    storage facilities, processing plants, quality
    assurance systems, marketing capabilities and
    farmer support programmes... some smallholder
    farmers have failed to purchase the required
    quantity and quality of seeds, equipment and
    chemicals due to the removal of subsidies.
    Educational crop promotion seminars and extension
    services for peasants have largely been weakened
    by cuts in the budgetary allocations for such
    activities. ... Since infrastructure difficulties
    may lead to very high transport costs hence
    increased prices, private traders have
    concentrated business only in those areas with
    better facilities. Any area with ailing
    infrastructure has been deprived of marketing
    services...

20
Winners and looser soil
  • The truth about who profits and who loses from
    our global food system has never been more
    obvious. Take the most basic element of food
    production soil.
  • The industrial food system is a
    chemical-fertiliser junkie. In the current
    context of tight food supplies, the small clique
    of corporations that control the worlds
    fertiliser market can charge what they want and
    thats exactly what they are doing.
  • Profits at Cargills Mosaic Corporation, which
    controls much of the worlds potash and phosphate
    supply, more than doubled last year. The worlds
    largest potash producer, Canadas Potash Corp,
    made more than US1 billion in profit, up more
    than 70 from 2006. Panicking now about future
    supplies, governments are becoming desperate to
    boost their harvests, giving these corporations
    additional leverage.
  • In April 2008, the joint offshore trading arm for
    Mosaic and Potash hiked the price of its potash
    by 40 for buyers from Southeast Asia and by 85
    for those from Latin American. India had to pay
    130 more than last year, and China 227 more.

21
Winners and losers trade
  • Fertilisers are just a sideline for Cargill. Its
    biggest profits come from global trading in
    agricultural commodities, which, together with a
    few other big traders, it pretty much
    monopolises.
  • On 14 April 2008, Cargill announced that its
    profits from commodity trading for the first
    quarter of 2008 were 86 higher than the same
    period in 2007. Demand for food in developing
    economies and for energy worldwide is boosting
    demand for agricultural goods, at the same time
    that investment monies have streamed into
    commodity markets, said Greg Page, Cargills
    chairman and chief executive officer. Prices are
    setting new highs and markets are extraordinarily
    volatile.
  • In this environment, Cargills team has done an
    exceptional job measuring and assessing price
    risk, and managing the large volume of grains,
    oilseeds and other commodities moving through our
    supply chains for customers globally.

22
Absolute winners food traders
  • Bunge, another big food trader, saw its profits
    of the last fiscal quarter of 2007 increase by
    US245 million, or 77, compared with the same
    period of the previous year. The 2007 profits
    registered by ADM, the second largest grain
    trader in the world, rose by 65 to a record
    US2.2 billion. Thailands Charoen Pokphand
    Foods, a major player in Asia, is forecasting
    revenue growth of 237 this year.
  • The worlds big food processors, some of which
    are commodity traders themselves, are also
    cashing in. Nestlés global sales grew 7 last
    year. We saw this coming, so we hedged by
    forward-buying raw materials, says
    François-Xavier Perroud, Nestlés spokesman.
    Margins are up at Unilever, too. Commodity
    pressures have increased sharply, but we have
    successfully offset these through timely pricing
    action and continued delivery from our savings
    programmes, says Patrick Cescau, Group CEO of
    Unilever. We will not sacrifice our margins and
    market share.
  • The food corporations dont seem to be making
    these profits off the back of the retailers. UK
    supermarket Tesco reports profits up 12.3 from
    last year, a record rise. Other major retailers,
    such as Frances Carrefour and the USs Wal-Mart,
    say that food sales are the main factor
    sustaining their profit increases.
  • Wal-Marts Mexican division, Wal-Mex, which
    handles a third of overall food sales in Mexico,
    reported an 11 increase in profits for the first
    quarter of 2008. (At the same time Mexicans are
    demonstrating in the streets because they can no
    longer afford to make tortillas).

23
Absolute winners food traders
  • It seems that nearly every corporate player in
    the global food chain is making a killing from
    the food crisis. The seed and agrochemical
    companies are doing well too. Monsanto, the
    worlds largest seed company, reported a 44
    increase in overall profits in 2007.DuPont, the
    second-largest, said that its 2007 profits from
    seeds increased by 19, while Syngenta, the top
    pesticide manufacturer and third-largest company
    for seeds, saw profits rise 28 in the first
    quarter of 2008.
  • Such record profits have nothing to do with any
    new value that these corporations are producing
    and they are not one-off windfalls from a sudden
    shift in supply and demand. Instead, they are a
    reflection of the extreme power that these
    middlemen have accrued through the globalisation
    of the food system.
  • Intimately involved with the shaping of the trade
    rules that govern todays food system and tightly
    in control of markets and the ever more complex
    financial systems through which global trade
    operates, these companies are in perfect position
    to turn food scarcity into immense profits.
    People have to eat, whatever the cost.

24
Buyer power and the commodities
  • Two and a half billion people make their living
    by producing primary agricultural commodities. As
    many as 48 developing countries depend on two
    agricultural commodities export for more than 20
    percent of their total export revenues.
  • 38 developing countries depend on a single
    commodity export for more than 50 percent of
    their total export revenues
  • Despite recent price rises for some commodities,
    there is debate about how long this peak will
    last, and for many tropical products the long
    term price trend continues to be downwards,
    punctuated by increasingly volatile short term
    price fluctuations.
  • In addition, commodity producers also appear to
    be receiving a low and declining proportion of
    the final product price

25
A picture, better than much words
Small producers suffer when they are unable to
resist retailer buyer power, forcing them to cut
prices to the point where only the most efficient
can survive. The longer-term effect will be to
threaten the viability even of efficient
producers when investments are undermined by
inability to recover fixed costs as a result of
being forced to price at (shortterm) marginal cost
26
Buyer power the banana case study
27
Least but not last biofuels!
  • In the words of Jean Ziegler, the United Nations
    special rapporteur on the right to food, the
    switch to biofuels at the expense of traditional
    forms of agriculture is nothing less than a
    crime against humanity.
  • Initially championed as a means of protecting the
    environment, biofuels have become increasingly
    identified by big business as a profitable
    alternative to increasingly expensive oil. Within
    the space of a few years, biofuel has become a
    booming private industry capable of generating
    large rates of profit.
  • Huge tracts of land across the planet have in
    recent years been switched from food crops to the
    production of ethanol or biofuel, aimed primarily
    as a supplement to oil-based gasoline. Next year,
    the use of US corn for ethanol is forecast to
    rise to 114 million tonnesnearly a third of the
    entire projected US crop.

28
Least but not last biofuels!
  • Although maize production worldwide is growing,
    the increase is being more than absorbed by
    biofuel diversification. According to the World
    Bank, global maize production increased by 51
    million tonnes between 2004 and 2007. During that
    time, biofuel production in the US alone (mostly
    ethanol) rose by 50 million tonnes, absorbing
    almost the entire global increase.
  • Subsidised by the US government, American farmers
    have diverted fully 30 percent of corn production
    into the ethanol scheme, driving up the cost of
    other, more expensive, grains that are being
    bought as substitutes for animal feed.
  • The European Union, India, Brazil and China all
    have their own targets to increase biofuels. The
    EU has declared that by 2010, 5.75 percent of all
    gasoline sold to motorists in Europe must stem
    from biofuel production.

29
Least but not last speculation!
  • Increases in global population and the switch to
    bio-fuels are important factors in the rise of
    food prices, these long-term factors are
    important, but they are not the real reasons why
    food prices have doubled or why India is
    rationing rice, or why British farmers are
    killing pigs for which they cant afford
    feedstocks. Its the credit crisis.
  • The food crisis has developed over an incredibly
    short space of time, essentially over the past 18
    months
  • The reason for food shortages is speculation in
    commodity futures following the collapse of the
    financial derivatives markets. Desperate for
    quick returns, dealers are taking trillions of
    dollars out of equities and mortgage bonds and
    ploughing them into food and raw materials. Its
    called the commodities super-cycle on Wall
    Street, and it is likely to cause starvation on
    an epic scale.

30
Least but not last speculation!
  • Under conditions of growing debt defaults arising
    from the US subprime crisis, speculators and
    hedge fund groups have increasingly switched
    their investments from high-risk bundled
    securities into so-called stores of value,
    which include gold and oil at one end of the
    spectrum and soft commodities such as corn,
    cocoa and cattle at the other. The article in the
    New Statesman points out that speculators are
    even placing bets on water prices and then
    concludes
  • Just like the boom in house prices, commodity
    price inflation feeds on itself. The more prices
    rise, and big profits are made, the more others
    invest, hoping for big returns. Look at the
    financial web sites everyone and their mother is
    piling into commodities.... The trouble is that
    if you are one of the 2.8 billion people, almost
    half the worlds population, who live on less
    than 2 a day, you may pay for these profits with
    your life.
  • Investment in soft commodities is currently
    highly recommended by leading market analysts.
    According to Patrick Armstrong, a manager at
    Insight Investment Management in London, Raw
    materials can prove to be the best investment
    class for hedge funds because the market is so
    inefficient. This results in more chances for
    profit.

31
Least but not last speculation!
  • Much of the international speculation in food
    commodities takes place on the Chicago Stock
    Exchange (CHX), where a number of hedge funds,
    investment banks and pension funds have
    substantially increased their activities in the
    past two years. Since January of this year alone,
    investment activity in the agricultural sector
    has risen by a quarter at the CHX, and, according
    to the Chicago firm Cole Partners, involvement by
    hedge funds in the raw material sector has
    trebled in the past two years to reach a total of
    55 billion.
  • Large-scale investors such as hedge and pension
    funds buy futuresshares in basic goods and
    foodstuffs to be delivered at a fixed date in the
    future. When the price of the commodity rises
    significantly between the time of the investment
    and the time of delivery, the investor is able to
    take home a large profit.
  • In light of the current food crisis, substantial
    returns of profit are guaranteed. According to
    CHX figures, wheat futures (for delivery in
    December) are expected to rise by at least 73
    percent, soybeans by 52 percent, and soy oil by
    44 percent.
  • Major ecological disasters, such as the recent
    drought in Australia, which hit food production
    and drive up basic commodity prices, are good
    news for the corporate investor.

32
Least but not last speculation!
  • An article headlined Deadly Greed in the
    current edition of the German weekly Der Spiegel
    gives some details of the activities of hedge
    funds in food market speculation. The magazine
    cites the example of the hedge fund Ospraie,
    which is generally regarded as the biggest of the
    management funds currently dealing in basic
    foodstuffs.
  • The manager of the fund, Dwight Anderson, is
    nicknamed the raw materials king. Already, in
    the summer of 2006, Anderson was recommending the
    extraordinary profitability of agricultural
    crops to his shareholders. While Ospraie is
    reluctant to publicise its profit levels from
    speculation in basic commodities, a leading
    German investor is less reticent.

33
Least but not last speculation!
  • Andreas Grünewald started up his Münchner
    Investment Club (MIC) in 1989 with seed capital
    equal to just 15,000. MIC now controls a volume
    of 50 million, of which 15 million is from
    investment in raw materials.
  • According to Grünewald, Raw materials are the
    mega-trend of the decade, and his company
    intends to intensify its involvement in both
    water and agricultural stocks. MIC investment in
    wheat alone has already yielded profit levels of
    93 percent for the 2,500 members of the club.
  • The Spiegel points out that MIC and its members
    give little thought to the catastrophic
    consequences of their speculative investment
    policy for undeveloped countries. Most of our
    members are rather passive and orientated to
    profit, Grünewald notes.

34
Least but not last speculation!
  • MIC, with its 50 million, is a minor player
    compared to the finance giant ABN Amro, which
    recently acquired a unique certificate allowing
    it to speculate on behalf of smaller investors on
    the CHX.
  • In the wake of the hunger revolts that took place
    a few weeks ago, ABN Amro put out a prospectus
    noting that India has enforced a ban on exports
    of rice, which, together with poor harvests in a
    number of countries, has led to a worldwide
    decline in rice reserves. Now, ABN Amro notes
    in its prospectus, it is possible for the first
    time to have a share in the number one foodstuff
    in Asia.
  • According to the Spiegel report, those responding
    to the ABN Amro appeal were able to realise a 20
    percent rate of profit in the space of three
    weeksa period that saw a huge increase in
    investment in rice in Chicago and other major
    centres.

35
From food security
  • The Right to Food
  • The right to food is a fundamental right included
    in the universal Declaration of Human Rights
    (United Nations 1948), under Article 25
    Everyone has the right to a standard of living
    adequate for the health and well-being of himself
    and of his family, including food This right
    was later clarified in the International Covenant
    on Economic, Social and Cultural Rights adopted
    in 1966 and which took effect in 1976 The
    States Parties to the present Covenant recognize
    the right of everyone to an adequate standard of
    living including adequate food, The States
    Parties will take appropriate steps to ensure the
    realization of this right. (Article 11)
  • In its General Comment 12, the Committee on
    Economic, Social and Cultural Rights clarified
    this right The right to adequate food is
    realised when every man, woman and child, alone
    or in community with others, has physical and
    economic access at all times to adequate food or
    means for its procurement.
  • The Special Rapporteur on the right to Food, Jean
    Ziegler, clarified this definition with the
    following The right to food is the right to
    have regular, permanent and unobstructed access,
    either directly or by means of financial
    purchases, to quantitatively and qualitatively
    adequate and sufficient food corresponding to the
    cultural traditions of the people to which the
    consumer belongs, and ensuring a physical and
    mental, individual and collective, fulfilling and
    dignified life free from anxiety.
    (E/CN.4/2001/53, para. 14).
  • Food Security
  • The definition of food security adopted at the
    World Food Summit (Rome - 1996) was the
    following Food Security exists when all people,
    at all times, have physical and economic access
    to sufficient, safe and nutritious food to meet
    their dietary needs, as well as to culturally
    acceptable food preferences for an active and
    healthy life.
  • Extract from the declaration adopted at the World
    Food Summit held in Rome from 13th to 17th
    November 1999

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To Food Sovereignty!
  • Food Sovereignty
  • In 2001, Via Campesina specified their definition
    of food sovereignty Food sovereignty is the
    right of peoples to define their own food and
    agriculture to protect and regulate domestic
    agricultural production and trade in order to
    achieve sustainable development objectives to
    determine the extent to which they want to be
    self-reliant to restrict the dumping of products
    in their markets
  • Food sovereignty requires
  • - Placing priority on food production for
    domestic and local markets, based on peasant and
    family farmer diversified and agro-ecologically
    based production systems
  • - Ensuring fair prices for farmers, which means
    the power to protect internal markets from
    low-priced, dumped imports
  • - Access to land, water, forests, fishing areas
    and other productive resources through genuine
    redistribution
  • Recognition and promotion of womens role in food
    production and equitable access and control over
    productive resources
  • - Community control over productive resources, as
    opposed to corporate ownership of land, water,
    and genetic and other resources
  • - Protecting seeds, the basis of food and life
    itself, for the free exchange and use of farmers,
    which means no patents on life and a moratorium
    on genetically modified crops and
  • - Public investment in support for the productive
    activities of families, and communities, geared
    toward empowerment, local control and production
    of food for people and local markets

37
Why do we have to change the rules?
  • KPMG 2008 CSR report stated that
  • Over the largest 250 companies, nearly 80 issued
    CSR reports
  • Theyre only 45 if we consider the whole target
    of the report (2200)
  • TNCs are 64.000 worlwide and at least 10 issued
    CSR reports.
  • Only half of the top 250 disclosed the details of
    the monitoring for their supply chain code of
    conducts

38
When will the poor start getting richer?
39
Quick answer from fair trade principlespractices
  • Adam Smith prize for fair trade!!
  • Helps reduce trade imbalances
  • Supports access to credit
  • Stabilizes prices
  • Establish long term relationship
  • Invests part of the income in social goods and
    services
  • Offers parallel distribution opportunities
    through the world shops
  • More and more builds win-win north-south and
    south partnerships

40
Trying to innovate supply chains
  • Fair (www.faircoop.it) is a small organization
    born with the mission to create and support
    innovative fair trade and solidary economy supply
    chain schemes.
  • MADE in NO (www.made-in-no.com) (as NOvara but
    also as No to exploitation of small scale
    producers), for instance, is a new project that
    connect
  • - The Sartoria Giuseppe Bruzzese of Galliate
    (province of Novara, Italy), its a small scale
    enterprise specialized in tailoring swimsuits,
    that lead a group of artisans and manufacturers
    of his territory, to share and analyze impacts of
    the delocalization and liberalization of the
    textile sector.
  • Justa Trama, a brand-new textile brand that
    process fibers following ecological and solidary
    criteria, a dream became reality through the
    efforts of workers of different regions of
    Brazil. Over 700 families, farmers and artisans,
    have decided to take the lead of their lives and
    develop an economy that respects and preserves
    the environment and themselves.
  • Remei AG that promote organic farming, fairness,
    ecological processing, top quality, and full
    transparency of supply chain linking over 6000
    family farmers in India and Tanzania
  • World shops and Solidary purchasing groups in
    Italy (we call them GAS, Gruppi dacquisto
    solidale)

41
Result? Small steps
  • Clean food and better wages to the brazilian and
    indian farmers
  • Access to solidary economy networks and
    opportunities to survive to crisis for brazilian,
    indian and italian producers
  • A fantastic organic, fair trade and
    participated cotton underwear!!!

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But a growing solidary economy movement!
43
Still hungry?
  • Thanks for your patience/Grazie
  • per la pazienza!
  • Infos monica.disisto_at_faircoop.it
  • www.faircoop.it

Professionisti capaci di futuro Monica Di Sisto
vice presidente
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