African cocoa farmers receive very little
from the price of your chocolate bar
(EPA/EMPICS)
Two sides of the coin
Globalisation sounds great for everyone – wealthier countries,
higher employment and more freedom to move around. Not so. In
this game there are winners and losers.
Supporters of globalisation say free markets and free trade are
the way out of poverty for poorer countries. But it’s not a level
playing field. Some countries are getting left behind.
It works like this. Poor countries are charged high taxes on
goods traded with rich countries. But the rich countries trade
with each other without paying the same taxes. An example of the
effect this has is that developing countries can only afford to
export raw materials. But it’s the finished products, like a chocolate
bar not the cocoa beans, that make the most profit. These trading
rules cost developing countries around $700 billion per year in
loss of profit. That’s more than they receive in aid!
Globalisation means that companies produce more goods in the
cheapest way for the biggest markets. It has enabled corporations
to grow so large that some are richer than countries. Nestlé,
for example, is richer than Ghana.
On top of this, poorer countries have cheaply produced surplus
produce dumped on them from richer countries. These means that
it costs them far more to produce it themselves, which in turn
threatens local farmers’ livelihoods.
Aid is also often ‘tied’ – subject to conditions on how it’s
spent and how quickly it can be used. This can stop poor countries
from using the money where it’s most needed. |
