Causes and Remedies

Causes and Remedies
Transnational Institute, 1974
From the Mouths of Babes: The World Food Market
LINK (IPS/Transnational Monthly) 3, November 1974

Jacques Chonchol (former Minister of Agriculture in Chile), Rene Dumont (French agriculturist), Edmundo Flores (Mexico's ambassador to the Food and Agriculture Organisation), and David Baytelman (a Chilean professor of agronomy) prepared the report and led the seminars.
Another Chilean, Sr. Santa Cruz, who narrowly missed election as the Third World's candidate for Director General of the FAO, joined the IPS/TNI delegation after the report was issued. The 83-page report concludes that:

It is an historic imperative that the break with the status quo of food distribution come from within the boundaries of the underdeveloped countries. After generations of static productivity rates, these countries must increase their rates significantly. But for this to happen, we must give new meaning to an old axiom: no sustained agricultural development can be achieved without social progress; and social progress is impossible without sustained progress in agriculture. As staggering as is the number of hungry people in our world, for the profit-oriented 'food industry' they are virtually non-existent. With little or no 'buying power' they cannot compete with even low-income consumers in developed countries. Precisely in creating a global market, the food firms have thrust the hungry into direct competition with the affluent. Only a few years ago in many an underdeveloped country the national production of such commodities as fruits and vegetables was large enough to enable even the poor or, in some cases, the bottom half of the population to eat their native foods at least occassionally.
The most powerful instruments of neo-colonialism are the multinational companies which seek only to maximise their profits. For them 'underdevelopment' means raw materials, cheap labour, and highly profitable markets. Modern multinationals have generally abandoned their initial interest in owning land or holding concessions in the underdeveloped countries. They prefer to control in-coming technology, marketing, transportation, and the primary manufacturing industries set up either in the home country or in the neo-colony. With this system, they can market bananas, for example, in such a way as to obtain 90 percent of the final value of the product for themselves. Only 10 percent stays in the producing country. A similar pattern occurs in marketing the surpluses of developed countries like the US. In the case of wheat, companies appropriate all the margins, including government subsidies, while US farmers do all the productive work.