Wealth of Trans National Corporations and the vision of localization
Adam Smith, who misread future economic history, wrote "The Wealth of Nations," in the year 1876. Since then the world underwent dramatic changes. What we observe today is poverty of nations instead of wealth of nations and simultaneous wealth of transnational corporations. The wealth of the world has increased -- multinationals are becoming wealthier, but the majority of the people of the world and most nations of the world, the Least Developed Countries (LDCs), are becoming poorer.
The money levied on the industrial countries by the oil –producing countries during late seventies and early eighties was invested in American banks which were looking for borrowers all over the world, and especially in Latin America. The economy was globalised . Globalisation is accelerating the process of further marginalisation of the primary producers in the LDCs as we shall see in the subsequent paragraphs. Amartya Sen explains in his well known theory of entitlements, the Bengal famine was not the result of a drastic slump in food production but because the colonial masters had diverted food for other commercial purposes. Recent development adequately shows -- the past is very much alive.
SAPs pressurised for withdrawal of subsidies in our countries while heavy subsidies are allowed in the rich northern countries. Livestock subsidies in the northern countries of one dollar per day per cow contributed to collapse of our milk industry. The Earth is one -- but the world is not. What is play to them is death for us. Tanzania, once being respected for Ujama model of self reliance, is now categorised as a heavily indebted poor country (HIPC) with debt at two and half times its revenue. Recent debt relief under HIPC initiative took place in exchange for a new set of policy conditionalities. ActionAid research shows that donors have substantial leverage over countries'' policy choices including water privatisation. In Dar es Salam, city water was privatised despite wide spread public opposition. There has been very little meaningful public participation or consultation and no transparency around the privatisation process. Even the country’s elected Members of Parliament were kept largely in the dark. Now water tariffs have increased, water quality has not improved. Higher tariffs means that people living in the poorer areas without water connections are likely to face higher water bills from their neighbours and water vendors.
These problems originate from a common source of global power structure. During the earlier decades, by the powerful states directly and recently by the market forces in collusion with the powerful states, inflicted one sided decisions on the weaker states. Nobel prize-winning economist Joseph Stiglitz has written: "Globalisation today is not working for most of the world's poor, for much of the environment, for the stability of the global economy. The West has seriously mismanaged the process of privatisation, liberalisation, and stabilisation. By following its advice, many third world countries today are actually worse off now." For example, under pressure from her creditors, Malawi exchanged maize her people's main staple -- for dollars to repay debt. And now it is getting another loan to purchase genetically modified food from the United States. The impending famine in sub-Saharan Africa opens up a new market to sustain the multi-billion dollar biotechnology industry. What happens to human health in the South is not at all a concern in the immoral Washington consensus.
What is true for one village is also true for the other 85 thousand villages of the country nay for the rest of the LDCs. Poor cow-raising women in the remote villages of Bangladesh receiving micro-credit under harsh conditions find it very difficult to earn a livelihood despite hard work, and encounter a hostile market to sell milk even though their product is cheaper than bottled water because of dumping of powdered milk. Similar is the case with rice farmers. SAPs insist on reducing service sector, prioritising export oriented productions rather than producing necessary consumer items for meeting domestic needs, and removing steps meant for protecting domestic industries.
Impact of Market Globalisation as seen in a Bangladesh village
Livelihood of the poor is under attack by the market forces. Such forces not only took away livelihoods of the poor in the village Golia Khali but also created human disability. One Civil Society Organisation survey shows that disability in Sitakunda is highest in Bangladesh (17%) while national average is thirteen percent. There are as many as fifty mills and factories in the Sitakunda vicinity employing only five persons from this village. Most mills and factories polluted land, water and forests along with health hazards. No scientific research is yet to be undertaken with authentic analysis on the impact of industries in the vicinity on the health of the local people. The local people complained that the worst of them are ship breaking and PHP. Such pollution destroyed fish breeding ground in the adjacent Sandeep channel. Fisher folks can no more fish enough for their livelihood. Market globalisation has been exhausting biodiversity resources depleting the livelihood options.
Market offered very little to the hard core poor. When the fortunate children go to school for building their better future; hard core poor children, fighting for their immediate survival, go to catch shrimp fingerlings in the sea beach, to contribute to their deficit family income or gleaning the last rice from the rats’ burroughs. Hard core poor families who can’t send their children to school today, generates third generation of hard core poor where poverty will perpetuate beyond MDG time frame. Market opened catching shrimp fingerlings but privatised schools where hard core do not qualify to participate. Such unjust system kills globally fifty thousand humans per hour.
Though market offered very little for the poor, albeit taking the bigger share of the cake. Shops are every where in the village. All the shops are replete with cold drinks even hot drinks recently being popular in a particular age bracket. Most Golia Khali rustics who earlier used to travel to Sitakunda for daily essentials now buy at their door steps. People are not no more going to the market. Market is going to their door steps. Much of remittance as well as micro finance are being siphoned off as it happened in some Latin American countries before crash. If World Bank model did not work in the Latin American countries, it can not work here for the same valid reasons. In addition, market globalisation is destroying local culture through TV /CDs as more and more sub continental culture is penetrating the village. All the shops have TVs to attract customers, through advertisement, in a village where enough money is entering from remittance.
Farmers complained about high input costs of agriculture as well as degradation of land through application of chemicals and pesticides, which are very much part of market globalisation these days. According a local civil society investigation - about two hundred such local varieties of rice has already depleted. Farming is no more lucrative. More and more farmers these days are working in the Middle East as unskilled laborers. High costs in agriculture pushed them out of agriculture and migrate to new destinations. Under a different imaginary situation within the same theoretical construct, with better control over inputs as well as product market, agriculture could experience transformation, absorbing more people working both in backward linkage as well as forward linkage activities. In the era of Information Communication Technologies (ICT) water melon is sold in the village at taka four to five to the intermediaries. This means – super profit for the intermediaries, rather than for the producers. Pro producer economic leadership, linking the producer with the consumers, is yet to emerge here. Is it very difficult to connect the direct producers with Agora / Meena bazaar for fair trade, while mobile phones are every where! Leadership, to spawn localisation as alternative to globalisation, is the need of the time.
Agriculture is a loosing concern but agro business is a profitable and beyond the reach of the farmers. Agricultural technologies, in tilling, water extraction, all the technologies are external. Without knowledge and technology control along with emerging menace of global seed business, the slogan of self reliance needs to be revisited in the new context. Market globalisation offers very little where the farmers can flourish through hard work and knowledge integration. Such inner transformation/ weaving of agrarian society from within is not achievable as long as market globalisation will continue to bulldoze the small local economies. Yearly about six million taka incoming remittance and about three million taka micro finance in Golia Khali failed to generate such inner momentum to flourish from within in a milieu of hostile external context. Too much money chasing too many external goods- means – local economy is suffering impotence. The environment under market globalisation is hostile where the state agencies are yet to play active pro citizen role under given global power structure. How subsidies in American agriculture negatively affect our farmers in Bangladesh needs to be sorted out. Decisions are remote these days. Glorification of local wisdom needs to be seen in proper perspective. Experience of the farmers is no more singularly answers all the questions. Remote information that affect out reach villages are now playing more crucial roles. A shift from agriculture increasingly towards agro industries is the future of this agricultural country where protection during industrial infancy must come from the state agencies, appointed and elected. If an economy facing problems to transform from primary into secondary and from secondary into tertiary, decidedly the economy is a sick economy. Forces, blocking such transformation, must be resisted.
Community scores functioning of state agencies, NGOs and the market forces
Community of Golia Khali gave highest score to the state agencies and lowest to the market forces rather in most cases negative. Role of the state agencies in building roads, installing education institutes, electricity, embankment and afforestation along the beach that protected and promoted their land were highly appreciated. They could not imagine such change triggered by state agencies before liberation. Nation’s liberation three decades ago started giving premium. They gave more scores to the role of the state agencies including appointed and the elected, for protecting land from salinity. And expected more in evolving system where costs of agricultural inputs. (How much subsidy do we give to our farmers compared to the other countries?)
One point should be made absolutely clear here. This write up is not meant to advocate against industrialisation rather finding a socially just basis for industrialisation, addressing social gap, adding value to the local economy. And finding a society weaved through consensus, with participation of all segments. A society built on gaps will ultimately fall apart. Recent indicators of anger expressed through violence, desired by none but a burning reality that adequately substantiates my argument.
Fisher folks were found very unhappy. Fisher folks are the victims of wrong policy. Unbridled industrialisation in the vicinity created disabilities. Polluters never learnt to compensate to the victims. Civil society is yet to generate advocacy momentum in promoting rights of the victims perpetrated by the market forces. Some scientific research on pollution, emanating out of industries in the vicinity, will add value in fomenting such momentum and giving advocacy a concrete basis. What happened in the lives of the fisher folks of Kerala through long organisational process, what happened through academic research analysing comparative analysis of livelihood versus electricity around Pakmun dam, Thailand, will it be too much for the fisher folks of Goalia to expect and dream?
Bangladesh villages are in the threshold of transformation. Whatever enabling environment, since liberation the state agencies created, the grassroots community made fuller use of those. Amid market globalisation, it will be difficult for the farmers to move ahead without civil society role (who are better equipped with remote information), cum state forces (possesses coercive power) in fighting these negative forces. Government of the Least Developed Countries (LDCs) and the civil society needs to find niche while straddling between collaboration and confrontation in hard negotiations WTO events, whatever come in the way. Wrong decisions there in a country, with nearly six billion remittance and with 13 million micro finance users where mills are closing and malls are opening, will mean economic crush as happened in the Latin American countries blindly practicing World Bank model.
Way Out: Twisting Globalisation into Localisation
Brave world citizens/academic activists have started raising their voice regarding what a world we are heading towards! Jeffrey Sachs of Columbia University rightly calculates- ending poverty is possible and within our life time . Bangladesh trend over the last decades with threefold rise in per capita income shows – poverty is not endless. However, the question is- will the tiger ever eat grass?
In a situation where the government role is gradually shrinking and proving too weak to counter external forces and market forces are increasingly taking over, civil society organisations and citizens must assert enhanced space. The government seems to be too weak, in front of the TNCs, to protect the rights of the citizens and defend the national interest. Perhaps we are heading towards a new reality -- to ponder the new paradigm of people’s sovereignty and increased CSO or citizen role to supplement weaker governments in the South, to counter greedy liberalisation. For instance, what happened in Tanzania with water privatisation could not be repeated in Bolivia due to steep resistance from the consumer citizens. Countries such as Malaysia, China, and Japan that did not follow the dictates of the IMF and World Bank are now reaping the benefit. Countries having the guts to say no and to opt for local solutions have been able to reduce poverty at a faster rate.
It is time for donors to stop tying aid. Holes are lying in trade, needs to be hard negotiated in the international events particularly of WTO. Donor conditionality should be limited to what is necessary to ensure that aid money is spent on the people it is intended to benefit. Donors need to give countries space to develop their local solutions.
The world will not change if the local economies are not strong enough for long hard talks with the global market perpetrators. Earlier local societies were built on/ weaved in local experience in their little world. Local community knew, through experience, how to manage those- matured over thousands of years. Earlier isolated local societies are now hooked by the remote TNCs. If the local leaders, including NGOs/CSOs/ local market forces/ political Society/ policy makers, do not go for necessary knowledge for action, it will be difficult to revert the process and push the counterparts to sit beyond the green rooms. Traditional MF NGOs, with resource intensive approach, without preparation with knowledge, will settle at too little in the emerging context of market globalisation. Knowledge leaders will not feel empowered without knowledge workers / the front liners, in constant in touch with the grassroots to fill in with grassroots experience and refill the community with remote information. Such a localisation process will necessitate in investing in building knowledge society at the grassroots.