Export at Any
Cost - Oxfam's Free Trade Recipe
for the Third World
by Vandana Shiva
Oxfam International's report
"Rigged Rules and Double Standards" on Trade, globalisation
and the fight against poverty is a brave attempt at combining two paradigms.
However, when two paradigms are incommensurate, putting them together
only creates a schizophrenic analysis. And this is the fate of Oxfam's
report on globalisation.
Oxfam International makes
a failed attempt to mix two paradigms -- one which gives precedence
to people's democracy, another which gives precedence to trade, commerce,
markets. The first paradigm on globalisation is based on principles
of justice, democracy, sovereignty and sustainability and is held in
pluralistic ways by the anti-globalisation movement which has exposed
the distorted and unjust rules of trade in the W.T.O. and the World
Bank/IMF trade liberalisation programmes, the second paradigm of globalisation
as promoted by these organisations.
The first paradigm contextualises
and embeds trade in more fundamental policies based on people's rights,
democratic participation, and ecological sustainability. The second
paradigm dismantles democracy, sovereignty and sustainability as "trade
barriers", puts trade above other policy instruments. In disembedding
trade from its social and ecological context, it dismembers society
and disintegrates ecosystems. It creates poverty by destroying the fabric
of economic and ecological security.
Ninety per cent of the Oxfam's
report reproduces the critiques of globalisation, even though it fails
to acknowledge its debts to the anti-globalisation movement and attempts
to ridicule it by coining the term "globo phobe". The anti-globalisation
movement is not globo phobic, it is based on deep internationalism and
solidarity. What it is against is the rules of free trade unregulated
by ethics, justice, democracy and ecological limits.
Oxfam also seems to be against
these "rigged rules" of trade except when it comes to chapter
4 on Market Access and Agricultural Trade". In this chapter trade
liberalisation and unregulated markets become the be all and all of
economic policy. The chapter begins with the standard W.T.O./World Bank
assumption -- Trade can provide a powerful engine for economic growth
and poverty reduction. For that engine to function, poor countries need
access to rich-country markets. Expanding market access can help countries
to accelerate economic growth, while at the same time creating new opportunities
for the poor. This is especially so for agricultural products and labour
intensive goods, since the livelihoods of so many people living below
the poverty line are concentrated in these sectors.
Market access is supposed
to be magic potion for pulling the poorest out of poverty. However,
market access is just another word for export orientation and export
domination. Trade is after all a relation between an exporting country
and importing country. By putting all focus on market access to rich
importing countries Oxfam hides and renders invisible the economic,
social and ecological costs generated by export obsessed and export
dominated policies of agriculture in poor Third World countries. While
the market access suggests that rich countries are being called to make
a sacrifice, it is the poor in poor countries from whom the real sacrifice
is being demanded.
Increased exports in agriculture
and market access also implies increased consumption in countries where
non-sustainable consumption is already pushing the earth's limited resources
beyond carrying capacity. How many more shirts and jeans can rich consumers
wear, how much more green beans and strawberries can they eat? The Oxfam
report is blind to the implications for non-sustainable consumption
based on increased exports from poor countries to rich countries. And
it ignores the fact that in agriculture more consumption in rich countries
is based on less consumption of basic needs and hence more poverty in
Since agricultural trade
is based on land, water and biodiversity, and supply of land and water
is limited, export oriented agriculture policies divert land and water
from production of staple foods for local consumption. Export domination
shifts natural resource use to produce luxury products in poor countries
at cheap cost for rich consumers in rich countries. It shifts control
over resources from small farmers and fishermen to agribusiness corporations,
destroys the natural resource base through non-sustainable use and in
the process destroys livelihoods of the small producers and creates
poverty instead of removing it.
All Third World countries
are being required by the World Bank to shift their agriculture to export
oriented agriculture with a focus on exports of meat, marine products
and flowers and vegetables. Oxfam's "new" recipe is the old
World Bank recipe of export first. The only difference is that Oxfam
labels it in the W.T.O. jargon of "market access" while the
Bank calls it trade liberalisation and economic reforms. The recipe
fails the poor on 3 counts.
Firstly, it diverts scarce
land and water resources from meeting local food needs to providing
for export markets thus creating hunger and conditions for famine of
the most vulnerable and marginal communities. This is what happened
during colonialism and is happening under the recolonisation of globalisation.
As Utsa Patnaik, a renowned Indian economist has shown, under British
rule per capita consumption in India declined from 200kg/ha in 1918
to 150 kg in 1947. Non-food grain crops expanded 10 times faster than
food grains, feeding export markets. The Great Bengal Famine which killed
2 million people was the result. In Java, under Dutch rule, export crops
expanded by 600% while paddy consumption declined from 199kg/cop in
1885 to 162 Kg/cop in 1940.
The inverse relation between
increasing exports and declining food consumption locally and nationally
has been exhibited under export led strategies of World Bank Structural
Adjustment Programmes. In Nigeria, Ethiopia, Sudan, Kenya, Tanzania
and Zaire which account from 60% of the population of sub-Saharan Africa,
there has been a 33% decline in cereal output per head and 20 per cent
decline in overall food per head in less than a decade. All the countries
saw rising agricultural exports per head along with declining food output
of food consumption per head.
Oxfam which started as a
famine relief agency seems to have forgotten its roots and has not once
raised the issue of food entitlements and famine in its chapter on agricultural
Secondly, the figure of an
added $100b income for exporting countries hides the costs to local
ecosystems and local livelihoods when peasants and fishermen are displaced
by export corporations and agribusiness who use non-sustainable systems
to maximize gains and profits. In the preferred sectors of meat, flowers
and shrimps, a shadow cost of 10$ is left in terms of ecological, devastation
and ruined livelihoods for each $ of export earnings to companies. Oxfam's
magical figure of 100b$ increased export earning thus hides one trillion
dollars of social and ecological destruction in local economies, leaving
local communities poorer. That is why every shrimp farm, every flower
unit, every slaughter house is protested against by local people.
Three areas of exports which
have been heavily promoted under the new trade liberalisation regime
are aquaculture, floriculture and meat. According to the received ideology
of free-trade the export earnings from exports of farmed shrimp, flowers
and meat would finance imports of food and hence any short fall created
by diversion of productive capacity from growing food for domestic consumption
to growing luxury items for consumption by rich northern consumers would
be more than made up.
However, it is neither efficient
nor sustainable to grow shrimp, flowers and meat for export in India.
In each case more food production capacity is destroyed domestically
through diversion of resources and destruction of ecosystems than the
food that can be purchased on global markets through exports. In the
case of flower exports, India spent Rs. 1.37 billion as foreign exchange
for promoting floriculture exports, and a mere Rs. 0.32 billion were
earned. India can buy only one fourth the food it could have grown with
export earnings from floriculture.
Our food security has therefore
declined by seventy five percent, and our foreign exchange drain increased
by more than Rs.1 billion. In the case of meat exports, for every dollar
earned, India is destroying fifteen dollars worth of ecological functions
performed by farm animals for sustainable agriculture. Cattle in India
are the sources of organic fertilisers and renewable energy. When they
are killed for exports, these essential services given freely by the
cattle to the farmer are destroyed and we have to import chemical fertilisers
and fossil fuels, thus increasing foreign exchange outflow and leading
to increased climate instability.
In the case of one export
slaughter house Al Kabeer, based in Andhra Pradesh, the State could
have saved foreign exchange worth Rs. 360 million per year from the
first lot of animals which were be killed. Taking into account their
average remaining life span to be 5 years more, they would have saved
forex worth Rs. 360x5 - Rs. 182 billion. Following the same argument,
if all the animals which are going to be killed during (say) 5 years
of Al-Kabeer's operation live out their natural life span, then they
will be able to save forex worth Rs. 182.05 x 5 = Rs. 910 billion. This
means that against a projected earning of Rs. 200 million by Al-Kabeer
through the killings, the state can actually save Rs. 9.1 billion in
foreign exchange by non-killing.
In the case of shrimp exports,
every Rupee of export earnings has generated more than five rupees of
ecological destruction of water, biodiversity, agriculture and fisheries.
Industrial shrimp farming destroys 200 times more area than the actual
size of ponds through salinisation of ground water, pollution of coastal
waters, destruction of agriculture and mangroves. For every job created,
fifteen livelihoods are destroyed. More food production is destroyed
through destruction of domestic agriculture and fisheries than can be
purchased by the export earnings from industrially farmed shrimp. Further,
export earnings go to rich industrial houses, and the price of destruction
is paid by poor peasants and artisanal fisherman.
Thus, as a society, we are
paying more in terms of food insecurity and ecological destruction than
we are earning through exports of luxury crops such as shrimps, flowers
Farmers of Andhra Pradesh
are protesting against Vision 20/20 an export led policy for which envisions
no role for the small holder but sees agriculture as the export business
Finally, export liberalisation
is bad for exports. Not only do people and the environment loose out
in an unregulated trade regime, exports too suffer. India known as the
pepper queen, which tempted waves of colonisers can no longer export
pepper because of dumping and downward competition in prices. Further,
competitive devaluation of national currencies forces countries to export
larger and larger volumes of export commodities for lower and lower
Higher exports do not therefore
mechanically translate into higher incomes, falsifying the central premise
of Oxfam's report that 1% increase in exports world contribute to 100b$.
Even if countries have doubled their export volumes, they have had no
increase in foreign exchange earnings because of declining terms of
trade. Changing the terms of trade requires structural change in the
global economy -- the kind the anti-globalisation movement is calling
With this structural change,
trade is no longer the "engine of growth". West Bengal increased
its agricultural productivity and growth not through exports but through
land-reforms. Putting resources in people's hands, and guaranteeing
small producers access to local markets is the most secure, sustainable
and inclusive way to remove poverty. Small producers need market access
to local markets which are being destroyed as global corporations dump
falsely priced, artificially cheap, subsidised products using import
International trade built
on a foundation of strong local economies and resilient ecosystems will
play a positive role. Export oriented economies built by alienating
peoples resources, destroying local livelihoods and destroying ecosystems
and local economies creates poverty at the societal level, even though
a small number of displaced people get jobs in the export sector.
By decontextualising trade,
Oxfam has become blind to the context in which export led national policies
shift from food first to export first policies, agriculture moves from
a peasant occupation of millions to a handful of agribusiness corporations,
and natural resources are no more owned and used by local communities
for their livelihoods and welfare but by corporations to service the
luxury consumption of the rich. These are the issues on which Oxfam
is silent -- there are no small farmers and peasants in the report,
only "producers", there is no sustainable agriculture in the
Oxfam vision, only market access, even though shifting from external
inputs to internal inputs has been established to be the most effective
means of improving farm incomes.
These are the issues at the
heart of food and agriculture debates worldwide. Everywhere a call is
being made to re-imbed agriculture in ecology, culture and basic needs
of food and livelihoods. Movements are working for the rejuvenation
of small farmers, defending small farmers and strengthening local markets.
This is where trade justice will be achieved. Not in the timid echo
of the World Bank, or in the "market access" chorus of the
Zoellick -- Lamy -- Short choir which Oxfam has joined as the youngest
choir boy. It talks of an "inclusive globalisation" but the
project of economic globalisation is a project of economic and political
exclusion. And it is this economic exclusion which is creating a politics
of exclusion in Europe and in India.
The genocide of Gujrat and
the rise of LaPen in France are features of the politics shaped by economic
globalisation that has destroyed livelihoods and jobs, resources and
cultures. Oxfam, and other supporters of globalisation have called the
building of strong resilient local and national economies "isolationist".
But these are the foundation of economic security and hence the only
antidote to Xenophobia and fundamentalism and forces of hatred and isolationism.
The insecuritiesm generated by globalisation are providing fertile ground
for facist isolationi m to emerge. Globalisation thus feeds isolationism,
exclusion and fragmentation of society. Strong local economies integrate
communities by generating overall security and reinforcing inclusive
The equations are clear:-
Globalisation = insecurity
and exclusion. Economic Democracy and localisation = security and inclusion.
Oxfam has a dream of building a movement for transforming the trade
system just as powerful as the movement against apartheid in South Africa.
For that Oxfam needs to walk with the movements of the people and drive
its passion and power and legitimacy from them.
Oxfam now has to make a choice
-- will it stand for trade regulated by principles of peace, justice
and sustainability or will it become a weak, coopted, voice of the dominant
free trade interests?
Will it put peace and peoples
security above commerce and trade?
Will it put people first
or trade first?
Will it put food first or
Will it go all the way in
the struggle for structural change and transformation of trade rules
and the free trade paradigm?