View previous stories
	The right to food is about much more than boosting supply by Olivier De Schutter UNDP, IPES-Food   It is increasingly common for big agribusiness firms to contract out the production of raw commodities to hundreds and thousands of smallholders, sometimes known as “outgrowers”. Through the contracts they negotiate with small-scale farmers, private investors are shaping agriculture in the developing world.   For example, the investment pledges gathered in the G8’s New Alliance for Food Security and Nutrition are primarily made up of plans by multinational and domestic agribusiness firms to source more widely from smallholders in a range of African countries.   Yet what matters is precisely what is agreed between investors and small-scale farmers, and small-scale food producers have been largely neglected by agricultural policies to date.   Understanding this situation is crucial to assessing the role of private investment in achieving the Sustainable Development Goals (SDGs).   In contract farming, farmers commit their output to processing or marketing firms at (generally) predetermined prices. Doing so can give them improved access to inputs and credit at one end, and easier access to markets at the other. Plugging small-scale farmers into new and lucrative market openings can help them to share the gains of globalisation.   Under certain conditions, contract farming can also help in the development of localized food chains, for instance by linking farmers’ co-operatives to the local food-processing industry or to fresh produce retailers serving urban consumers.   At the same time, however, farmers can easily become disempowered by contract farming: it may result in passing risk down to them and exposing them to markets that are volatile, while allowing agribusiness firms to consolidate their commodity supply chains.   An extensive review of the experiences of contract farming to date reveals that safeguards must be built into the scheme to ensure that the benefits of contract farming outweigh the potential costs.   Local governments need to play a role, scrutinizing contractual arrangements to check that they are transparent, viable and beneficial to both parties; that they are fair and that dispute procedures are in place; that they respect women’s rights; that quality standards are clear; and that they will not harm the environment.   It is equally important, however, to consider other development models that can provide farmers with the benefits of contract farming – such as access to credit and markets, price stability and risk spreading – without the potential drawbacks.   Farmers should be encouraged to consider forming co-operatives and joint ventures – allowing them to join together to access markets without losing power over their land and livelihoods – or direct-to-consumer food marketing, which links small-scale farmers to markets while allowing them to increase their incomes and retain control of their production.   Improving small-scale farmers’ access to markets is vital for achieving food security and improved nutrition, but we must also improve farmers’ bargaining position in food chains.   Today, the relationships between producers and buyers are deeply unequal and they will remain so unless farmers have a variety of channels through which to sell their produce, and the capacity to negotiate better deals.   In my view, this is what the right to food is all about: not simply a matter of boosting supply to meet growing needs, but of who produces, for whom, under what conditions. It is not just a question of reducing the gap between farm-gate prices and retail prices to ensure affordable food, but also of empowering the most marginal food producers, allowing them to capture a greater portion of the value of their produce. In short, it is about allowing the vast number of small-scale farmers in developing countries to reach, finally, their full potential.   * Olivier De Schutter, is Co-chair, International Panel of Experts on Sustainable Food Systems (IPES-Food): http://www.ipes-food.org/ Visit the related web page
	Is the BRICS bank tooled for sustainable development? by Juana Kweitel, Srinivas Krishnaswamy China Dialogue, Righting Finance, agencies   As the BRICS bank scales up it must outline clearly how it will ensure investments are environmentally safe.   The leaders of Brazil, Russia, India, China and South Africa met in Goa, India for the 8th BRICS Summit last weekend to advance integration and sustainable development among the countries. But one year after the launch of the BRICS New Development Bank (NDB), a central question remains; is the NDB tooled to be a real engine for sustainable development?   The NDB is up and running and approved US$911 million (6.1 billion yuan) worth of infrastructure and energy projects within the BRICS countries in its first year. This first tranche of projects includes various energy investments, with an encouraging nod to renewables, including rooftop solar and wind. Another factor distinguishing the NDB is that it has started to lend to countries in domestic currencies rather than pegging all loans to the dollar, a practice which has tended to saddle countries with more debt.   The NDB is now looking at adding additional member countries, accepting financing outside of the five BRICS countries, and expanding operations to include lending to the private sector.   But as the BRICS Bank works to position itself as a major player for sustainable development, there are several obstacles in its way.   The NDB has not yet defined what it sees as sustainable development or set forth sustainability criteria for its investments. While the Bank has an exclusion list, which identifies certain investments as ineligible for NDB financing, that list does not include, for instance, unsustainable fuel sources like coal. If the NDB is going to be something new it will need to break away from the export-oriented, extractivist development model that has proven a failure. And that break will require a clear roadmap.   Second, while the NDB has acknowledged the importance of environmental sustainability, it has doggedly ignored the basic tenets of social sustainability; transparency and participation. The NDB did not involve civil society in the formation of its social and environmental policy framework despite repeated calls for consultation.   While the NDB released an Interim Policy on Information Disclosure, it has not put in place the necessary measures or mechanisms to ensure that all communities that might be impacted by NDB investments have the information they need, the opportunity to influence project decisions and access to remedy if they are harmed.   Finally, it is questionable whether the NDB’s new policy framework is robust enough to ensure sustainability or to prevent harm. In its social and environmental framework, the NDB opted for more aspirational principles rather than concrete requirements for environmental and social performance.   Moreover, the framework allows the NDB to preference the use of countries’ domestic systems without clear criteria or processes by which such standards will be assessed. While NDB officials have stated that they will work to ensure enforcement of local laws and regulations, this loophole is a major concern since many countries are systematically dismantling their national environmental and social protections, as is the case with Brazil.   As leaders gathered for the BRICS summit in Goa, India this month, civil society groups in BRICS countries and beyond called on the NDB and its member countries to adopt clear commitments, including the establishment of sustainability criteria, meaningful engagement with affected communities and civil society at the project and policy level, and the development of a robust policy framework that meets international standards and reflects best practice.   With a firm retooling, the NDB could position itself as an engine for sustainable development. Without it, the NDB will just be tinkering with the same old worn out development model. http://bit.ly/2e36TLV   * Access the Civil society statement to BRICS Goa Meeting via the link below.   Holes in the World Bank’s safety net, by Gretchen Gordon. (Righting Finance)   In August, the World Bank concluded a major policy review process to adopt a new Environmental and Social Framework to replace its suite of “safeguard” policies – the policies designed to ensure that development activities financed by the Bank do not cause harm to communities or the environment. The outcome of this four-year review can be summed up in ten words: The safety net got bigger, and so did its holes.   First, the good news. The new framework covers a broader scope of social issues than the old one. The policy now places social impact assessment and management more on par with that of environmental issues which historically have received greater attention in development projects. The framework now also has provisions to prevent discrimination in Bank-financed activities and requires assessment and mitigation of impacts on “vulnerable or disadvantaged” groups.   It also includes a new labor standard to protect workers and provisions requiring that new construction and services are accessible, where feasible. This expansion of the safety net to cover more people and social issues is a welcome change.   Now for the bad news, the new framework shifts from a compliance-based system with clear requirements and timelines for planning and reporting, to a more flexible “adaptive management” framework. In several areas, key requirements for Bank supervision and due diligence were eliminated, while responsibility for various aspects of assessment, reporting, and supervision was shifted from the Bank to the borrower.   This shift presents real risks for affected communities. Now key assessment and planning documents might not be disclosed and reviewed until it is too late for communities to raise concerns or for projects to be adjusted.   The “adaptive management” approach was sold by Bank management as a way to reduce what was seen by some as a “frontloaded” planning and design process, and to improve implementation throughout the lifecycle of a project.   Unfortunately, while the up-front requirements were eliminated, they were not replaced with more supervision during implementation. Safeguards compliance has always been a major challenge for the Bank. Unfortunately, rather than bolster supervision, the new framework dials it back.   The new framework also allows significantly greater leeway for the Bank to decide to waive the safeguards in lieu of a country’s national laws and regulatory systems or the standards of co-financiers. The Bank asserts that the new framework will “boost protections for people and the environment and drive sustainable development through capacity- and institution-building and country ownership.”   However, it is unclear how country systems will be strengthened and where necessary resources will come from. It is also unclear whether and how the Bank will assess these alternative systems to ensure that a minimum level of protection is met.   Some of the most contentious fights in the safeguards review process were over human rights. The framework, for instance, includes a provision in the vision statement that “the World Bank’s activities support the realization of human rights expressed in the Universal Declaration of Human Rights” and “the World Bank seeks to avoid adverse impacts and will continue to support its member countries as they strive to progressively achieve their human rights commitments.”   However, the Bank declined to adopt a binding commitment to actually respect human rights.   While an earlier draft of the policies included references to human rights instruments, these were all eliminated in the final draft, resulting in several provisions that undercut human rights standards. The new labor provisions are a striking example.   “The new policy will, for the first time ask the borrowing countries to abide by some basic workers’ rights and working conditions in Bank-financed projects,” said Ahmad Awad, of the Jordan-based Phenix Center for Economics & Informatics Studies.   “Unfortunately, it leaves workers at risk by failing to include core labor standards and suggesting that freedom of association in projects financed by the Bank will not be required in countries that do not have national laws protecting this right.”   Protection for indigenous peoples is another area where the framework took one step forward and two steps backward. New provisions were added to protect pastoralists and peoples in voluntary isolation as well as a requirement for free, prior and informed consent (FPIC). At the same time, key protections, such as provisions on benefit-sharing were weakened.   “The proposed new policy represents a step forward from the existing policy in that it includes a requirement for free, prior and informed consent from indigenous peoples, however, it still fails to meet international human rights standards by defining consent as ‘collective support’ rather than ensuring respect for the results of affected indigenous peoples’ independent and collective decision-making processes,” said Prabindra Shakya, with Asia Indigenous Peoples Pact. “Further, the requirement of FPIC is restricted to very narrow situations rather than all projects that impact indigenous peoples as identified in participatory assessments.”   The Bank argues that the new framework will promote better, more sustainable development outcomes. “These new safeguards will build into our projects updated and improved protections for the most vulnerable people in the world and our environment,” stated World Bank President Jim Yong Kim upon adoption. But civil society groups see it very differently.   “The lack of binding requirements to uphold human rights and provide appropriate remedy for violations, the weakened requirements for use of national regulatory systems or financial intermediaries, as well as a lack of requirements to disclose real information about potential impacts at project level leave communities unprotected in World Bank financed projects,” said Sukhgerel Dugersuren, of OT Watch Mongolia. “I see this as an obvious move away from its mandate to reduce poverty around the world.”   The new policy framework will not take effect for another year and a half. In the meantime, the Bank will be developing the procedures, guidelines, and processes for implementation. Hopefully the Bank will engage with civil society groups in the development of procedures and guidelines so that some of the holes in the framework can be patched. And hopefully the Bank will put in place systems to assess outcomes and adjust the new framework along the way.   Either way, the new Social and Environmental Framework will pose major challenges. Communities and civil society groups will have the difficult and critical task of monitoring Bank-financed projects to catch those who fall through the safety net’s holes and to hold the Bank and its shareholders accountable for the results they have promised.   * Gretchen Gordon is Coordinator of the Coalition for Human Rights in Development, a global coalition of social movements, civil society organizations and community groups working to ensure that all development finance institutions respect, protect, and fulfill human rights. http://bit.ly/2fN29Lg   More of the Same: World Bank Doing Business Report continues to Mislead, by Anis Chowdhury and Jomo Kwame Sundaram (IPS).   The World Bank’s Doing Business Report 2017, subtitled ‘Equal Opportunity for All’, continues to mislead despite the many criticisms, including from within, levelled against the Bank’s most widely read publication, and Bank management promises of reform for many years.   Its Foreword claims, “Evidence from 175 economies reveals that economies with more stringent entry regulations often experience higher levels of income inequality as measured by the Gini index.” But what is the evidence base for its strong claims, e.g., that “economies with more business-friendly regulations tend to have lower levels of income inequality”?   Closer examination suggests that the “evidence” is actually quite weak, and heavily influenced by countries closer to the ‘frontier’, mainly developed countries, most of which have long introduced egalitarian redistributive reforms reflected in taxation, employment and social welfare measures, and where inequality remains lower than in many developing countries.   The report notes that relations between DB scores and inequality ‘differ by regulatory area’. But it only mentions two, for ‘starting a business’ and for ‘resolving insolvency’. For both, higher DB scores are associated with less inequality, but has nothing to say on other DB indicators.   Other studies — by the OECD, IMF, ADB and the United Nations — negatively correlate inequality and the tax/GDP ratio. Higher taxes enable governments to spend more on public health, education and social protection, and are associated with higher government social expenditure/GDP ratios and lower inequality. The DBR’s total tax rate indicator awards the highest scores to countries with the lowest tax rates and other contributions (such as for social security) required of businesses.   The DBR’s bias to deregulation is very clear. First, despite the weak empirical evidence and the fallacy of claiming causation from mere association, it makes a strong general claim that less regulation reduces inequality. Second, in its selective reporting, the DBR fails to report on many correlations not convenient for its purpose, namely advocacy of particular policies in line with its own ideology.   The World Bank had suspended the DBR’s labour indicator in 2009 after objections — by labour, governments and the ILO — to its deployment to pressure countries to weaken worker protections. But its push for labour market deregulation continues. For example, Tanzania’s score is cut in 2017 for introducing a workers’ compensation tariff to be paid by employers while Malta is penalized for increasing the maximum social security contribution to be paid by employers.   New Zealand beat Singapore to take first place in the latest DBR rankings following reforms reducing employers’ contributions to worker accident compensation. Nothing is said about how it has become a prime location for ‘money-laundering’ ‘shell’ companies.   Meanwhile, Kazakhstan, Kenya, Belarus, Serbia, Georgia, Pakistan, the United Arab Emirates and Bahrain — eight of DB 2017’s ‘top 10 improvers’ –– have recorded poor and, in some cases, worsening workers’ rights, according to the International Trade Union Confederation. A DBR 2017 annex claims that labour market regulation can ‘reduce the risk of job loss and support equity and social cohesion’, but devotes far more space to promoting fixed term contracts with minimal benefits and severance pay requirements.   In support of its claim of adverse impacts of labour regulations, DBR 2017 cites three World Bank studies from several years ago. Incredibly, it does not mention the extensive review of empirical studies in the Bank’s more recent flagship World Development Report 2013: Jobs, which found that “most estimates of the impacts [of labour regulations] on employment levels tend to be insignificant or modest”.   DBR 2017 adds gender components to its three indicator sets — starting a business, registering property and enforcing contracts — concluding: “For the most part, the formal regulatory environment as measured by Doing Business does not differentiate procedures according to the gender of the business owner. The addition of gender components to three separate indicators has a small impact on each of them and therefore a small impact overall”.   Should anyone be surprised by the DBR’s conclusion? It ignores the fact that the policies promoted by the Bank especially adversely affect women workers who tend to be concentrated in the lowest paid, least unionized jobs, e.g., in garments and apparel production or electronics assembly. The DBR also discourages regulations improving working conditions, e.g., for equal pay and maternity benefits.   Despite its ostensible commitment to ‘equal opportunities for all’, the DBR cannot conceal its intent and bias, giving higher scores to countries that favour corporate profits over citizens’, especially workers’ interests, and national efforts to achieve sustainable development.   Sadly, many developing country governments still bend over backwards to impress the World Bank with reforms to improve their DBR rankings. This obsession with performing well in the Bank’s ‘beauty contest’ has taken a heavy toll on workers, farmers and the world’s poor — the majority of whom are women — who bear the burden of DBR-induced reforms, despite its proclaimed concerns for inequality, gender equity and ‘equal opportunities for all’. http://bit.ly/2gPAn6i Visit the related web page
	View more stories