The economic crisis arrived as poor countries were already struggling to cope with high food prices and floods, droughts and food shortages linked to climate change.
“Green shoots of economic recovery have not reached the poorest countries which are now suffering severely in the global downturn,” said Max Lawson, Oxfam senior policy advisor.
Oxfam analysis of economic data has discovered that governments in Sub-Saharan Africa will be $70 billion worse off this year as a result of the global slump. Unlike rich countries they cannot borrow their way out of trouble. Without outside help governments will find it increasingly difficult to respond to the climate, food and economic crises and to avoid cutting spending on schools, clinics and other anti-poverty programs.
“Despite feeding their own economies a much-needed stimulus, the G20 has not yet provided even half the $50 billion bailout it promised poor countries in April.”
Oxfam is calling for a $290 billion package of measures to ease the burden on developing countries without hitting ordinary taxpayers. The package includes a ‘Tobin tax’ on currency transactions, a debt moratorium and a crackdown on tax havens.
“Existing aid levels are not enough to protect the status quo never mind reduce poverty in the face of the economic crisis, climate change and rising food prices,” said Lawson.
“The G20 has the chance to change the bad habits of the past and come up with new solutions to the problems facing poor people. A currency transaction levy on the banks that helped cause the global slump could bring in $50 billion to help those suffering in a crisis they did nothing to cause. It is time bankers paid a bonus to the world’s poor.”
Oxfam is also calling on G20 leaders to fulfill a promise made by President Obama in July to deliver new funds to help poor countries cope with climate change. This funding is vital to break the deadlock in climate change negotiations leading up to the make-or-break UN Summit in Copenhagen in December. Oxfam calculates that $50 billion per year is needed to help poor countries cope with climate change and another $100 billion is needed to help them control their emissions.
“The clock is ticking on the chances of a fair deal to prevent misery for millions at risk from climate change. It is time for G20 leaders to stand up and deliver the money needed to protect poor people,” said Oxfam climate change advisor David Waskow.
]]>"Resuscitating Doha is essential to right the rigged rules of trade, but what's been simmering on the WTO stove will simply not deliver for poor countries, said Oxfam America president Raymond C. Offenheiser. "The financial crisis, which started in developed countries but is taking its worst toll on developing countries, should be the impetus for a change in course."
In a new report released today called "Empty Promises," Oxfam details how the Doha Round has become an exercise in prying open developing country markets rather than an effort to rebalance decades of unfair agricultural and industrial trade rules. In the midst of a global economic crisis, a food crisis, and a climate crisis, nations with the least blame and with the least capacity to cope with the consequent effects must not have to pay even more to enable their economies to develop, according to the report.
Over 50 million people stand to lose their jobs, remittances are collapsing, and growth in sub-Saharan Africa is predicted to fall by 70 percent this year trapping 90 million more people in poverty, because of the crisis. Food prices meanwhile remain high for poor consumers: by the end of 2008 a further 109 million people had been added to the ranks of hungry, topping 1 billion people worldwide. As the world experiences the sharpest drop in trade in 80 years, a "development" trade deal—as originally promised—remains crucial, according to Oxfam.
"Now is the time for WTO members to come back to the negotiating table, recognize that the current crisis provides an opportunity to address urgent development needs, and change the course of negotiations, much as they did nearly eight years ago in Doha," said Offenheiser. "At this time of desperate need for a change of course, the Doha Round has to step up to deliver on its development promise. There is little credit left for another failure."
The welcome political commitment from the G8 could lead to a fresh start to negotiations, but it cannot be business as usual. In the past eight years, developed countries have used the talks to continue to push to open up new export markets. Developing countries have resisted, saying they were promised a deal that would give them space to protect their farmers and new industries, an end to rich country trade-distorting agricultural subsidies, and more access to rich markets for their farmers and industries.
The widespread food price crisis has shown that food and livelihood security cannot depend solely on market forces. Development, rather than liberalization, has to be the central objective of negotiations and trade rules must respond to the needs of the most vulnerable people first and foremost, according to Oxfam. It is the responsibility of WTO member states to analyze the role of trade in the recent global crises so that the Doha negotiations take into account the new global context and contribute to a solution, rather than exacerbate the problem.
"What's on the table is no silver bullet since it continues to favor the richest and biggest farmers and industrialists in the US and Europe and sidelines the needs of the poor," said Offenheiser. "We have seen what can be done when countries find the resolve to avert problems at home, and this resolve must be translated to the multilateral trade agenda so that the much-needed conclusion of the Doha Round can be achieved in a manner that addresses developing country needs first and foremost."
]]>Urgent action is required to make the bailout work for poor countries, complete the crackdown on tax havens and speed up reform of the IMF and World Bank, Oxfam said as it published its initial analysis of the London Summit, What Happened at the G-20?
The analysis also raises question over how much of the $50 billion promised for poor countries will be new money. Money distributed through the Multilateral Development Banks, in particular, could come from existing aid budgets.
Oxfam's recommended next steps towards for a 'new world order' are:
"The G-20 could mark an historic turning point but we have been here too many times in the past to take rich countries' promises at face value," said Duncan Green, Oxfam spokesperson. "World leaders need to take decisive steps to turn their rhetoric about a new world order into reality.
"That means an end to the damaging conditionality imposed on poor countries when they ask for assistance from the IMF. If the price of a bailout is to close health clinics and schools then the financial medicine offered by the G-20 will make the patient worse, not better.
"And it means real action to tackle climate change. It would be a tragedy if having benefited from an economic bailout, the world economy and the millions of poor people at greatest risk, quickly become the victims of climate change."
]]>Against this backdrop, how did the G20 leaders perform?
]]>Five men from the Community Cooperative for Rural Development, or CCRD, an Oxfam partner organization, stood along the mill's perimeter, watching it work. Serious and proud, they admired their prize: the only certified organic rice mill in the country.
Cambodian rice farmers, long vulnerable to fluctuating prices and heavy regional competition, are looking to organic rice to help them carve out a niche in the market. As eating healthily has become more popular around the world, so has organic food. Organic products sell for a higher price than conventionally farmed food. In a country where more than a third of the population lives on less than $1 a day and more than half depends on agriculture, the organic advantage could translate into a reliable and steady income.
"The momentum is really growing," said Le Thi Nguyet Minh, an Oxfam America program officer in the East Asia office. "We need to maintain it."
Maintaining the organic momentum requires establishing farming cooperatives, which are equipped to work in the organic market. This transition represents a huge practical and emotional leap for many Khmer farmers.
The bloody civil war and subsequent genocide that ravaged Cambodia left many Khmer people distrustful of both their neighbors—and any sort of collective work, said Yann Omer-Kassin, an Oxfam Quebec field advisor supporting CCRD.
Even the words "farming cooperative" pose a problem. In Khmer, they translate into "work camp," a term that conjures up painful fears or memories of Khmer Rouge death camps. Many of the people Kassin talked to in Pursat said they were wary of joining a farming coop "because it's linked to a horrible past."
Because of these cultural sensitivities, CCRD staff work slowly and patiently to convert farmers to organic production. They spend much of their time simply building trust in the cooperative concept. They point to the tangible benefits of organic production.
Farmers are encouraged to use animal manure instead of chemical fertilizers—a requirement of organic certification. The resulting savings can be used—to grow other crops, or send children to school. If farmers use natural fertilizer, they can also prevent illness. Many farmers and farm workers get sick because they can't read the labels on the chemicals they use. Many of the chemicals are so dangerous they're prohibited in other countries.
Tang Eum, 47, a rice farmer in Pursat, said she began farming organic rice three years ago. She said natural fertilizer doesn't always produce as much rice as chemical fertilizer. But she's willing to accept that tradeoff if it means her family and friends won't get sick.
CCRD has converted at least 75 of the 1,500 farmers in its collective to farm organic. Their support is crucial. Many of the rice farmers face the same challenges organic and fair trade coffee farmers saw when they first learned about the new model. Many have farmed small plots with chemicals for generations. They need help learning new agriculture techniques so that they can someday grow as much rice as they had before.
Then they need help getting the experience, technical assistance, and market access to pull it all off.
It is a challenging task, CCRD workers said. But knowing what they do about the potential benefits keeps them motivated. Eventually they want to help local farmers not only farm organically, but take the next logical step, and sell to the fair trade market.
Fair Trade Certified™ products are high quality and grown through practices friendly to the environment. Farmers receive a minimum price even when the market price is low. According to a 2005 market study, if farmers made the transition from conventional growing to fair trade organic they could see their profits more than double.
Sitting at a wood table outside her house in Pursat, Tang Eum said she knows what she wants to do with that extra money. A mother and a businesswoman, she would use it to support her family and sell her rice.
"I want to use the money to send my children to school," she said. "And I want to buy a moto to go to the market in town."
]]>Amid cheers from a throng of enthusiastic supporters and international media, Make Trade Fair won the day.
Oxfam's trade campaign was launched.
Within hours of the Hong Kong debut, events were held in 25 cities including Brussels, Dublin, Geneva, Mexico City, San Salvador, and Washington, D.C. These events ranged from press conferences and symposiums to a rock concert in London’s Trafalgar Square.
Oxfam's trade campaign seeks to unite concerned citizens around the world in calling for fair trade policies that will help move millions of people out of poverty.
Nobel Prize Professor Amartya Sen, UN Secretary-General Kofi Annan, and musician and social activist Bono were among those who endorsed the campaign. "Oxfam has got it right," said Bono. "It wouldn't cost much to change the rules of trade so that poor countries can work their way out of poverty. But the world's leaders won't act unless they hear enough people telling them."
Also in this issue of EXCHANGE, writers Frances and Anna Lappé discuss their book Hope's Edge: The Next Diet for a Small Planet, and we bring you updates on Oxfam's work with water and sanitation, drought in Ethiopia, and indigenous women in the highlands of Peru who are speaking out after decades of violence.
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