Mthandazo Ndlovu

  • In July 2014, the following Civil Society Organizations and Networks: South Africa Network on Inequality (SANI) at Economic Justice Network (EJN) of FOCCISA, South African Forum for International Solidarity […]

  • Guest blog post by Lesego Loate from PLAAS, Institute for Poverty, Land and Agrarian Studies, originally posted at http://www.plaas.org.za on 21 Jul 2014

    PLAAS

    The C20 Summit held on the 21-22 June 2014 released a communiqué that outlined the policy positions of civil society in the lead up to the G20 Summit in November 2014. The communiqué touched on a number of issues including climate change and resource security, governance, infrastructure, and equity and participation. As important an opportunity as the C20 Summit was to influence the economic agenda of G20 leaders; it unfortunately largely failed to reflect the challenges and therefore solutions that the developing global South requires not just for sustainable economic growth but also sustainable livelihoods for poor communities.

    The communiqué calls for economic growth that delivers positive social and environmental outcomes. This seems to be an incorrect analysis of global capitalism which is not concerned with social and environmental outcomes, but rather with profits. Moreover it asks for a global economy that creates employment for all and not just wealth for some and that incorporates “efficient and effective market based mechanisms that are acceptable and responsive to the needs of all people, fair and environmentally friendly.” Clearly this is contradictory as the very same “efficient and effective market based mechanisms” are the technological systems and machineries that have led to jobless growth (and rising unemployment), increased exploitation of natural resources by multinationals to the detriment of, and marginalisation of the most vulnerable in societies.

    There is also a call within the communiqué for the establishment of social protection systems in G20 countries to ensure fair and just societies. This seems to be in line with the argument that social protection needs to be expanded to take care of those that fall to the margins of society as the losers of global capitalism. This perspective presupposes that countries have the resource base to fund an expanded social protection system. A struggling global economy means that countries are generally facing difficulties in raising sufficient revenue to expend on social services such as social protection. Even though tax avoidance has been elevated as an issue to be pursued, as highlighted even in the communiqué, the reality is that many multinationals investing in countries (particularly the global South) still avoid paying tax, leaving their host countries’ treasuries lighter than they should be.

    The communiqué calls for global economic growth that is inclusive and does not exclude any groups of people. However; it fails to deal with the need for regulation of agricultural multinationals (as one of the root causes of economic exclusion for poor rural people) operating in the global South to ensure that their investments occur in a manner that does not threaten rural communities’ access to natural resources and thus sustainable livelihoods. The communiqué makes no reference even to agricultural multinationals committing themselves to existing voluntary frameworks on good practice for large scale land based investments. Given that in the global South women are the major stakeholders in small scale farming they are the ones most affected by the multinationals’ inequitable exploitation of natural resources such as land and water to the detriment of their economic participation.

    The communiqué recognises the need for a pluralistic food system to ensure that the global South can deal with the challenge of food security. However, the emphasis is only on the need to support small scale farmers instead of a holistic approach that also deals with the way small scale farmers are adversely incorporated into commercialised agricultural value chains which force even large commercial farmers to be price takers. The consequences of farmers being forced to be price takers in the global South have been devastating for rural employment and farm labourers’ income levels.

    There is also a call for the G20 to ensure equitable employment opportunities as a means of creating trust in the market based economy. This is problematic in that sustainable livelihoods should be the end rather than trust in the market based economy. Moreover, this ignores how the global economy has developed in such a manner that it now has (particularly in the global South) a structural unemployment crisis as characterised by the reality of jobless growth. This market bias is reflected in the deeply problematic policy ask in the communiqué for a world market to trade water. In the context of large scale land based investments in the global South that are so detrimental to local economic activities that they are often characterised as ‘land grabs’ and ‘water grabs’ this suggestion should really be a non-starter for G20 countries in the global South.

    There is rightfully an emphasis on dealing with corruption and the communiqué also comes out strongly on tax avoidance by asking for the G20 to adhere to policy frameworks relevant to these issues. However, the communiqué concentrates on state actors without explicitly putting the same demands on multinationals as major economic actors that need not only to be regulated but also need to reform their practices so their investments ensure sustainable natural resource use and economic development for local communities.

    The C20 reflects a lost opportunity for global civil society to make the kinds of policy asks on the G20 that would have ensured that the excesses being experienced by rural and urban communities in developing countries due to the global economy in general and agricultural multinationals in particular, are curbed. It also illustrates the divisions in civil society as the economic, poverty and inequality realities of countries in the North and South are different as well as (to an extent) the corporate behaviour of multinationals; given that countries in the South are less well regulated as those in the North. There is also a characterisation of the global economy that is removed from the major trends of the global economy.

     

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