Life on Earth: Who wins, the corporations or people?

The Jakarta Post, 5 June 2003 – HEADLINES

Yanuar Nugroho,

“Control your destiny, or someone else will,” is the famous phrase of business consultant Welch (1992) when explaining how strategic management in industry would very much affect the progress of corporations. The saying might be right.

On June 1 to June 3, representatives of countries known as the Group of Eight (G-8): Britain, France, Germany, Italy, the United States, Canada, Japan and Russia, met on the shores of Lake Geneva in the French Alpine city of Evian, France, to “control their destiny”.

Promising to discuss a “global plan” to meet the Millennium Development Goal, its agenda also could not but touch upon the implications for the rest of the world, i.e. the poorest of the poor. This concern was shown in rallies during the summit.

The summit seems not to have fulfilled its own agenda and to have failed to address pressing issues on the environment, development and health, facing the global economy. This failure does not only apply to G-8 Evian but also to other world-level summits, which have shown that the people’s interests are desperately neglected.

On environmental issues, the preparatory meetings held in Paris in late April abstained from unequivocal statements that would have enhanced the safety of marine transportation of dangerous chemical substances, especially crude oil. Under pressure from Japan, the G-8 environment ministers lifted the ban on single-hulled oil tankers to serve as carriers of chemical substances. Japan also opposed the strengthening of legal responsibility of ship owners, which reflects Japan’s economic specific interests, such as the defense of its ship manufacturing industry, and its heavy dependence on imported oil.

It reflects one of the most dangerous approaches to our earth — if only we could know how much our environment has suffered. Today, 78 million barrels of oil are extracted per day and natural gas production has reached 95 trillion cubic feet per year, in addition to about 4 billion metric tons of natural gas mining. Meadows (2000) stated that the production of natural gas creates massive pollution, since it is extracted (and spilled), shipped (and spilled), refined (generating toxins) and burned to produce numerous pollutants, including carbon dioxide, which traps outgoing energy and heats up the atmosphere. As a result, carbon emissions have reached a rate of 6.5 million metric tons this year, as global vehicle usage has reached 730 million –not including air traffic, which has increased by a factor of six since the 1970s.

On the water issue EU trade negotiators are using the World Trade Organization (WTO) to open up other countries’ water sectors for the benefit of Europe’s private sector water industry, thus failing to meet its own ambition of halving the proportion of people without access to safe drinking water and sanitation by 2015.

According to Europe-based, non-governmental organization the Corporate Europe Observatory (CEO), in early April the first proposal for a new 1 billion euro (US$1.17 billion) fund for water investment in 77 developing countries was released. The countries included those in Africa, the Caribbean, and the Pacific (ACP), all former colonies of EU member states. This proposal seemed more about corporate welfare than helping the world’s poorest, as then acknowledged by the EU Water Fund presented at the G-8 meeting, based on proposals made by a panel mostly financed by private multinationals managing water resources.

The panel was directed by former International Monetary Fund director Michel Camdessus, and last March, at the third World Water Forum, it issued a report, titled Financing Water for All, or the Camdessus Report, which openly advocates the “full cost recovery” of private investment in water. “Full cost recovery” means that governments in the poorest countries would guarantee private investment in water infrastructure, either through raising water tariffs, or by subsidies, in case users could not pay high water prices.

On health issues, the G-8 plan of action to improve the access of the poorest countries to medication has been ignored. A global health crisis and critical situation has arisen due to a lack of low-cost medicine in Africa, Latin America and Asia; and an integrated framework to improve access to medical treatment and medicine is desperately needed in the poorest countries.

Last year the WHO revealed that in the poor or less-developed countries every year 4 million people die due to respiratory infections, 2.2 million (cholera, typhus and dysentery), 1.7 million (tuberculosis), 1 million (malaria), 900,000 (blood-related illnesses) and 3 million (AIDS). Clearly, the agenda in the health sector should include the boosting of local medicine production in the countries of the South, and the transfer of technology from highly developed to developing countries. However, the U.S. government rejected the move, which led to a downgrading of the health issue at the G-8 meeting.

In short, it seems the health sector (or industry) only favors those who can pay. As of 1997, the largest pharmaceutical markets were developing countries — the U.S. and Canada (36.1 percent of the global market), Europe (29 percent), Japan (15.9 percent), Latin America (7.7 percent), other Asian countries (7.3 percent), the Middle East (1.9 percent), Africa (1.2 percent) and Australia-Pacific (0.9 percent). In 1999, 26 million of 33 million people with AIDS were in Sub-Saharan Africa, but the pharmaceutical market in Africa was only 1.3 percent of the world total (Business Watch Indonesia, 2003).

This sad fact might be in line with the U.S. proposal for health at the G-8 meeting, which underlined the “importance of a powerful private sector role” in health questions and simply dismissed the notion that the price of medication might be the principal obstacle to health improvement. Thus, the new “Plan of Action for Health” discussed by G-8, might fail, just as it did three years ago. At that time the G-8 met at Okinawa, with ambitious objectives to reduce the spread of AIDS. But since then the number of AIDS victims has increased.

So as the world celebrates Environment Day we should ask ourselves: Should we really run such businesses, whose profits are accumulated at the cost of endangering millions of lives? Can we really sacrifice our own grandchildren? Do we really want to control not only our destiny but also others’ — especially those who are powerless and poor and have thus become our dependents?

If the answer is still “yes”, we shouldn’t be surprised if people blame us and we would all end in a brutal autumn at the end of our lives.

The writer is the Executive Director of the Business Watch Indonesia and lectures at the Sahid University in Surakarta, Central Java.

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