Food multinationals threaten fight against poverty - new report (26/1/2005)

You can download Action Aid's new report, 'Power Hungry: six reasons to regulate global food corporations' from

This report is part of ActionAid's new campaign to curb the power of multinational food retailers over small farmers.

1.ActionAid Press release - excerpts
*No justice from Bayer poisonings
*Corporate concentration in national and global agrifood markets
*Intellectual property rights on plants and seeds
*Monsanto et al's child labour in India

1.Food multinationals threaten fight against poverty
ActionAid Press release (excerpts)

Multinational food companies are growing too big and powerful and are threatening the fight against poverty in developing countries, says a new report by development agency ActionAid.

The report - Power hungry: six reasons to regulate global food corporations - reveals that the activities of multinational food and agribusiness companies and their subsidiaries, such as Nestle, Monsanto, Parmalat, Syngenta and Unilever, threaten the livelihoods of hundreds of thousands of poor farmers and undermine basic rights.

ActionAid's evidence from Brazil shows that 50,000 dairy farmers have been forced out of business, after a series of takeovers by Nestle and Parmalat. In India, an estimated 12,000 children worked last year on cotton seed farms supplying subsidiaries of Bayer, Monsanto, Syngenta and Unilever. Many children were also exposed to dangerous pesticides.

These cases provide condemning evidence of the impact of increasing corporate power within the global food chain. The statistics are alarming:

Julian Oram, policy officer from ActionAid. "Our research shows that the world's poorest farmers are in effect subsidising the world's largest food companies, and in many cases are paying with their health, livelihoods and basic rights."

For more information on ActionAid's 'Stop corporate abuse' campaign visit: <>


To down load a copy of the full report visit

No justice from Bayer poisonings

"The kids were screaming, vomiting and grabbing their bellies. Some were dead, others were writhing on the grass and still more were on the school patio. We had no idea what to do." A villager from Tauccamarca, Peru, where 24 children died after swallowing a pesticide sold by Bayer

Five years after 24 children died in Tauccamarca in Peru after accidentally consuming a hazardous pesticide sold by the agrochemical company Bayer, their families are still waiting for justice.
a Peruvian Congressional Subcommittee found evidence of criminal responsibility on the part of Bayer and the Peruvian Ministry of Agriculture, and recommended they compensate the families. Despite this, the families have received no assistance, compensation or an apology from the company, which blocked a lawsuit brought by the families.

The Peruvian villagers are not alone in facing barriers to obtain justice against TNCs.

Corporate concentration in national and global agrifood markets

"For people who want to buy corn, there really isn't much choice but to come to us. " Bob Kohlmeyer, former manager, Cargill corporation

1) Seed and agrochemicals
* Six TNCs – BASF, Bayer, Dow, DuPont, Monsanto and Syngenta – now control 75-80% of the global pesticides market, down from 12 corporations in 1994.

* DuPont and Monsanto together dominate the world seed markets for maize (65%), and soya (44%).

* Monsanto controlled 91% of the global genetically modified (GM) seed market in 2001 and took over 60% of the Brazilian non-GM maize seed market in the space of two years (1997-1999).

* Bayer controls 22% of the Indian pesticide market.

Intellectual property rights on plants and seeds

"Patents held by northern multinationals deprive poor farmers of access to the means of growing their food." Jean Ziegler, UN Special Rapporteur on the right to food, 2003

The WTOs rules on IPRs have raised the cost of some agricultural inputs and encouraged anti-competitive practices in the industry. As these rules begin to be applied more widely in the South, their impacts are likely to have other marginalising effects on smallholder agriculture. IPRs could be granted very broadly to allow monopoly rights over individual plant varieties, genes and their characteristics.

This extension of IPRs further threatens food security in the South by removing farmers' customary rights to save, use, exchange and sell farm-saved seed. Increasing use of IPR-protected GM plants and seeds could make smallholders dependent on TNCs such as Monsanto, Syngenta and DuPont that hold the patents and IPRs. This, in turn, could fundamentally change the way agriculture is practised in developing countries by
facilitating the growth of large-scale agribusiness and the decline of small farms and biodiversity still further.

While IPRs have promoted and protected research by the largest corporations, they have had the opposite effect on public research bodies, plant breeders and smaller companies. As shown above, patents on genes and genetic traits have created expensive legal barriers that make it difficult for public sector researchers and smaller companies to gain access to new agricultural technologies.

Research and development can be blocked or becomes prohibitively expensive if royalties have to be paid on the patented processes or traits required for the research.

Most corporate research is driven by the demand for profits and control of markets rather than the needs of poor farmers in developing countries. It is estimated that around 80% of public research is oriented to smallholders’ needs, compared with only 12% of corporate research.

GM crops provide a classic example: less than 1% of all GM research is targeted at small-scale producers.

Most research is directed at crops that large-scale commercial farms grow in monocultures, often with destructive effects on local communities and the environment. Since the mid-1990s, large-scale, mechanised GM soy production in Argentina – promoted by the government and TNCs such as Cargill, Dow, Monsanto and Syngenta – has expanded to cover almost 14 million hectares of land.

The technology requires virtually no farm labour and has led to an "agriculture without producers". This has triggered a rural exodus into the shanty towns surrounding Argentina's cities, according to the advocacy group GRAIN.

In light of these threats to smallholder agriculture, it is vital that state and private actors ensure that agricultural inputs are designed to be appropriate and affordable for poor farmers, and that governments protect farmers rights to save, use, exchange and sell farm-saved seed.

Case study 3

Child labour on India's cotton seed farms

Transnational corporations have been accused of benefiting from the use of child labour to produce hybrid cotton seed in India, and of not doing enough to stop the practice in their supply chains.

It is estimated that 82,875 children were employed on cotton seed farms in the southern state of Andhra Pradesh in 2003-2004 -12,375 of them on farms supplying subsidiaries of TNCs such as Advanta, Bayer, Monsanto, Syngenta and Unilever.

Campaign groups report that many child workers are under 10 years old, 85% of them are girls, and they earn an average daily wage of 14-25 rupees.

Many are migrants from low castes who have been sold into debt bondage to pay off family loans. The childrens job is usually to cross-pollinate cotton flowers by hand for up to 13 hours a day; in the process, they are exposed to toxic pesticides. They sleep communally in small huts and complain of headaches, nausea and convulsions. "It is very hard work and we get tired and bored doing the same work again and again," says Sarala, a 12-year-old girl working in Alavakona village interviewed by ActionAid.

TNCs do not employ child workers themselves, but they do work with intermediaries known as "seed organisers" who in turn work with local farmers. Campaigners say the TNCs are complicit in the use of child labour because they help set and pay such low procurement prices for cotton seed that it makes it less viable for farmers to employ adult workers. They argue that TNCs exert a high level of influence and control over the cotton seed production process by giving farmers credit, technical advice and stipulating quality controls. Corporate representatives make regular visits to farmers fields to ensure that their standards are being followed, and to advise on the use of pesticides.

Despite this, Suhasini's experience is not an isolated one. Many children are suspected to have died from pesticide poisoning and a local civil society group, the MV Foundation, is currently investigating 36 such deaths of young children.

It appears it was mainly because of the efforts of local groups, who exposed and publicised the issue in 2001, that the companies took action against child labour.

Campaigners argue that stronger international human rights obligations on TNCs would have compelled companies to act sooner, even though the major companies deny that they have any legal responsibility for the activities of local farmers.

The TNCs have jointly set up a Child Labour Elimination Group to address the problem and Unilever says it intends to fulfil long-held plans to withdraw from India's cotton seed business in 2005.

Recent campaigns, legal actions against farmers and interventions by the state government, industry groups, TNCs and civil society have brought down the number of child labourers in Andhra Pradesh - from 247,830 in 2000-2001 to 82,875 in 2003-2004.

Some observers comment, however, that the decline is due mainly to drought, and that much more must be done by TNCs to get child workers out of the cotton fields and into education.


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