EU

Localising moves in four Eastern European countries

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The Romanian parliament has passed a law requiring large retailers with a turnover of 2m euros to allocate a minimum of 51% of existing space for fresh produce to products sourced locally, from a short supply chain.

The law, which came into effect last month, initially stated that products should come only from Romania but had to be amended after Brussels warned that this would be a breach of EU regulation. Under the amended text, Bulgarian and Hungarian products would also qualify as part of a short supply chain.

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French retailer Carrefour has founded an agricultural co-operative in a Romanian village to bring local fresh produce to its shelves. It includes 80 families of producers who own 60 hectares of agricultural land. Carrefour will source 5,000 tonnes of fruit and veg from the local co-op in the village of Varasti.

Through the co-op, which officially launches this month, farmers will be able to scale up production and have a single collection centre. The partnership with Carrefour guarantees them a production plan and price, and means they will receive fast payments for their products.

RetailEU described the legislation as protectionist but added that Romania is not the only country concerned about its local manufacturers; Slovakia  wanted to force supermarkets to inform customers at the entrance of the number of Slovakian products in the store and recently the Polish government introduced a “supermarket tax” on all major (and therefore foreign) retailers, as Hungary has already done.

 

 

 

Event: launch of post Brexit & Trump report commissioned by MEP

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The Brexit vote and the election of Trump have been hailed as marking the reversal of the long trend towards increased globalisation.

These changes possibly also mark the end of neoliberalism as the dominant ideology of our times. For opponents of what globalisation and neoliberalism have meant in practice these developments might be seen as welcome. Yet at the same time Brexit and Trump seem highly problematic for anyone concerned with social justice and ecological sustainability.

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A new report by Green House authors Victor Anderson and Rupert Read, commissioned by MEP Molly Scott Cato will be launched on Tuesday 28 March from 14.00 – 16.30 at Europe House in central London.

The report considers the impact of the UK’s withdrawal from the EU on trading practices and the opportunity to move to a less globalised and more localised economy. It emphasises that there are many different versions of Brexit, and aims to put a green version firmly on the political agenda.

Note: Panel discussion with Nick Dearden (Global Justice Now) and Helena Norberg-Hodge (Local Futures and International Alliance for Localisation of which Localise West Midlands is a member). Helena’s contribution will be by pre-recorded video due to prior commitments.

 

Register and get full details here.

 

 

 

Post-Brexit we need to build an economy for the many

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‘Home-grown solutions’

neil mcinroyYesterday, Ann (West Midlands New Economics Group) sent a link to an article by Neil McInroy (right), chief executive of the Centre for Local Economic Strategies. CLES focusses on economic development and regeneration, ‘promoting and implementing new progressive economic activities which create positive environmental, health and social outcomes’.

It was recently published in the New Start magazine under the title given and a few highlights are offered here:

“Framed by austerity, the economic reality behind many voters choosing Brexit was a future of little promise – insecure jobs, insecure public provision, insecure futures. As a result, many leave voters felt that they had little or nothing to lose. On the back of an economic recession eight years ago, insecurity and a social recession has been built . . .

“Maybe the game is up now? Brexit may now consume the energies of Whitehall and the treasury. The rhetoric and promise of more devolution from Whitehall may at best slow, if not stop. We can hope for more and deeper devolution, but I suspect this is a forlorn hope. More importantly, there is a pressing task in reducing the existing pain and hardship and addressing deteriorating community relations and cohesion.

“In this, the local economic development community, local politicians and potential Metro mayoral candidates have a responsibility. They must strive to protect and build progressive economic and social policy. They must look toward home-grown solutions, and radical innovations across public, social and commercial sectors. They must adopt a pro-social approach to local economic development. This is less about treasury-backed local agglomeration policies, boomgoggling promises and trickle down. This is about stimulating local demand, social investment, addressing city-wide inequalities and the economics of social cohesion. Progressive local solutions are out there. We need to be bold in accelerating them.

“I would hope the newly-formed commission on inclusive growth . . . (will) use its influence to broaden its narrow growth-within-austerity remit, and explore how to build a truly democratic, inclusive and resilient economy within fairly-funded public services.

“The Brexit vote was in part prompted by a sense that people felt abandoned by the economy, and the state. This has created a new local economic and political reality, and with it come great dangers. As such we must avoid deepening the social recession and accelerating the divides between the haves and the have-nots. It is imperative that we now build an economy for the many and not just the few”.

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Read the whole article here: http://newstartmag.co.uk/your-blogs/post-brexit-need-economy-many/

Quantitative easing to fund climate change programmes?

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Colin Hines, co-founder of Localise West Midlands and Richard Murphy, Professor of Practice in International Political Economy, City University, London, warn that the Paris Climate talks are facing an enormous funding problem to which there is only one viable solution.

In a new report published by Finance for the Future, entitled ‘Climate QE For Paree’, they suggest that the measures to be put on the table in Paris will not go far enough to halt a disastrous global temperature rises of more than 2 degrees because no one has suggested how the enormous cost of tackling this issue is to be addressed, particularly at a time of global economic slowdown.

The paper offers a solution to this problem, using a variation on the idea of People’s Quantitative Easing that has received much attention during 2015:

‘The world has or is intending to print €7 trillion of quantitative easing to keep the financial system afloat​. In that case, why not use this mechanism in the form of Climate QE to save the planet?

The European Central Bank is already e-printing €60 billion a month under its QE [programme and is committed to doing so till September 2016.

If it allocated say €10 billion a month either from this QE programme, or from an additional QE commitment, it could use it to buy climate change bonds from the European Investment Bank. The EIB could then direct these funds to climate change programmes in both Europe and developing countries.

This could have a galvanising effect on other rich countries, putting pressure on them to introduce their own Climate QE initiatives and thus further bolster global funds towards the many hundreds of billions eventually needed to keep temperature rises at 2oC.

Importantly, since Climate QE involves one arm of the EU, the ECB, creating e-money and using it to buy assets from another arm of EU, the European Investment Bank (EIB), this will not increase Europe’s repayable debt levels. This would also hold true for countries like the United States and the UK, something that is crucial to making involvement in ‘Climate QE’ post Paris politically acceptable to all rich countries.

How the European Investment Bank Could Spend Climate QE

The EIB already invests around 10% of its funds in developing countries and prioritises climate change mitigation and adaptation (e.g. renewable energy, energy efficiency, urban transport and other projects that reduce CO2 emissions).

To achieve the goals likely to be set in Paris, Climate QE funding should be used by developing countries to fund low carbon emitting industrial and agricultural infrastructure and energy efficient buildings in cities. Such projects face difficulty attracting private finance, since the returns are harder to identify and the process of capturing and sharing them are more complex than normal investment programmes.

Rich Countries would benefit too

Colin Hines said:

‘Climate QE is not just for poorer countries. The economic and employment advantages of investing in energy efficiency and renewables is not only a way to generate economic activity in every city, town, canton and hamlet across Europe, but will also ensure our continent’s significant contribution to helping solve the biggest threat facing humanity, which is climate change.’

For further details contact:

Richard Murphy, Director of Finance for the Future LLP and Professor of Practice in International Political Economy, City University, London

Tel +44 (0) 1366 383500

Mobile +44 (0) 7775 521 797

And

Colin Hines, Convenor Green New Deal Group

Tel +44 (0) 20 8892 5051

Mobile +44 (0) 7738 164 304

A message from Delhi about growth blindness: a manufactured disease

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An economic system created by and for moneyed interests:

devinder sharma 4Analyst Devinder Sharma writes about universities, educational institutes and business schools which are churning out graduates and postgraduates who are made to believe in the magic potion of growth. Newspapers are full of reports and quotes about growth. Finance ministers everywhere in the world swear by economic growth.

TV anchors, most of whom have not ventured out of their plush offices for years, are hung up on economic growth because that is what they have read in the university, and if they ever try to question the growth paradigm, the business house owning the channel will throw them out.

He concludes: basically, it’s all about protecting and saving your job. Whether you are a journalist, economist, academician, credit rating analyst or a politician, singing the growth chorus will help to save your job.

  • When we are told 80% of Americans live in ‘near poverty’ we just ignore it.
  • When we read that pollution levels in China and India are reaching dangerous levels, we take it as a small sacrifice that people must make for the sake of growth.
  • When the International Panel on Climate Change (IPCC) tells us that the world is getting closer to a tripping point, we go back to textbooks which tells us that every disaster is a business opportunity – meaning more growth.

The EU’s 5th Project: transitional Governance in the Service of Sustainable Societies

Olivier de SchutterOver the years, a handful of thinkers, including some economists, have begun to question the sustainability of growth economics. Their number is growing with each passing week. While the objective of this piece is not to take you through the corridors of alternative to growth economics that is building up, look at the latest initiative by Olivier De Schutter, who till recently was the UN Special Rapporteur on the Right to Food. He called for a conference: The EU’s 5th Project: transitional Governance in the Service of Sustainable Societies, which has just been held in Brussels, May 8-9, 2014. Olivier says:

“We need alternatives to GDP growth as the goal of public policy, and we need alternatives to work and wealth accumulation as the driving forces in our lives. A genuine transition in the way we live is the only true path to sustainability. But it must be accompanied by a transition in the way we govern. This is Europe’s fifth project.”

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Booking closed well before the event as demand exceeded the number of places. Among the speakers noted were Rob Hopkins of Transition Towns, and social epidemiologist Richard Wilkinson.

The EU’s 5th Project Conference posed a few key questions. These are the basic questions that every sensible person should be asking:

There are already distinguished people working on a radical overhaul of the food system, making it more local and sustainable. There are social entrepreneurs, academicians, thinkers, writers and activists who are talking of the Economics of Happiness. There are environmental movements across the globe that are fighting for bringing in some sanity in the economic growth paradigm. Their voice is growing.

Sharma ends: “Meanwhile, stand up and be counted. It’s time to remove growth blindness. At stake is your own survival, and the future of your children. You can’t leave a dead planet behind”. #
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Extracts from a post by Devinder Sharma to Ground Reality

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Relocalisation: an under reported issue in the French elections

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In the French election, left wing socialist Jean-Luc Melenchon has stressed the need to relocalise Europe’s economy and to do so by limiting imports.

This has brought Melenchon increased votes in a country where 70% of the population favour some form of protection for domestic production from cheaper, lower waged competitors.

Colin guardian picThis French election trend prompts a call for a debate about the need for ‘progressive protectionism’ in the UK and Europe-wide

LWM’s co-founder Colin Hines explains that progressive protectionism rejects the call for open markets and the need to be internationally competitive.

Acceptance of these edicts as inevitable by the three main political parties has consequences:

  • it drives down tax rates,
  • worsens social and environmental conditions
  • kills local jobs
  • and reduces small business opportunities.

Whistling in the dark to keep up the nation’s economic spirits: promising hi tech export-led growth in an era of rising Asian dominance is the last colonial delusion

The alternative is to propose a set of practical measures for protecting and re-diversifying local economies by limiting what goods they let in and what funds they choose to enter or leave the country.

In the process they will wean themselves off of their export dependence. This will allow space for domestic funding and business to meet most of the needs of the majority in society.

Proposing policies that would result in the grounding of manufacturing, money and services here in the UK would enable politicians and activists to call the bluff of relocation-threatening big business and finance, who at present have the whip hand over all politicians who support open markets.

This is the only way to tackle the economic and environmental crises, return local control of the economy to citizens and provide a sense of security and hope for their future. If implemented it could play a crucial role in seeing off the rise of the extreme right, as this invariably flourishes when the sense of insecurity within the majority worsens.

 

Forthcoming book
Forthcoming book

Progressive protectionism can tackle this insecurity far more effectively than any of the policies offered – at present – by parties of any political hue

The money markets would ferociously destabilise the challenge posed to their present dominance of the world economy by introducing progressive protectionism in one country alone. Europe is facing huge threats from the forces of international finance, yet the continent would be a powerful enough bloc to implement a programme of progressive protectionism, particularly if the politically active started to campaign for it.

The time to start the debate is now.

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Abridged from the Progressive protectionism website, written by Colin Hines. See another article on the subject here.

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The social cost of our food supply chains – inefficient and unfairly traded

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“Food supply chains in Europe are extraordinarily long and complex, involving multiple food business entities and opaque corporate structural engineering, which increases the difficulty for adequate inspection and regulation, and opens the door for fraud and criminal activity. It makes it difficult to work out who is responsible for what, and who’s to blame when things go wrong – see the lurid story in the Observer”.

alyn smith mepThese are the words of Scottish MEP Alyn Smith, SNP member of the Greens/European Free Alliance Group, in an article published on the website of the European Parliament’s Information Office in the United Kingdom.

He adds that a by-product of our system is that about 90 million tonnes of agricultural produce is wasted annually in Europe and about a third of the food for human consumption is wasted globally.

This happens at many points along the food supply chain, from harvesting losses to supermarket quality controls and – after sale – through poor purchasing decisions or food management by some consumers who only consider the sticker price.

The social costs – what kind of a world is it when:

  • those who till the soil to fill our dinner-plates can barely make enough to survive for another planting season,
  • milk and alcohol can retail at a lower price in the supermarkets than water,
  • disgusting slop can be served up to our children and our hospital patients on the grounds of “cost competitiveness”,
  • the number of malnourished people is roughly equivalent to the number of obese people
  • and when the fanatic search for lower prices amidst intense competition leads to the entry of the Mafia into our food chain?

 “We need nothing less than a food revolution”

Alyn Smith believes that this can be achieved through buying local produce and notes anecdotal evidence that sales at local butchers are up 20-25%:

“Short supply chains, farmers markets and quality labels cut out the middle men, enabling direct purchase by consumers and a guarantee for transparency and quality: it boosts the local economy as well, protects diversity in the retail sector and helps keep our farmers on the land. The Scottish Government have already invested £200,000 in farmers markets, and promoted education about healthy eating in schools.

A call for fair trade in Britain

“And we need to push harder for reforms to the EU’s competition rules, to ensure farmers can get the bargaining power they need for a fair price, and reduce the power of supermarkets to crush their smaller brethren”.

”Let’s seize the opportunity, not just to fix the immediate problems of fraud in food labelling and adequate inspections and controls, but to fix our food chain to make it fairer for producers and consumers alike”.

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Rebuilding of local economies and local politics

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It is fitting, as the last post paid tribute to LWM’s founding member George Morran, that this one takes up a theme related to the work George has undertaken for many years. LWM co-founder Colin Hines  recently wrote in response to Peter Wilby’s advice about creating:

Colin guardian pic“. . . a fairer Britain with a better balance between the returns to capital and labour . . . to build a common alternative to “the free market show” and to consider how the EU, currently a tool of international capital, can be turned into something better”.

Extract

“Site here to sell here” policies in every EU country, allied with “invest here to prosper here” constraints on cross-border money movements, would allow nation states to see off big business’s most potent threat – relocation.

Governments also need to be able to take back control of immigration in order to meet the democratic wishes of their people, to lessen pressure on social provision and to prevent the permanent loss of the brightest and the best from poorer EU countries.

Peter Wilby is right that no one country can protect its inhabitants from the ravages of open borders and that changes have to come at a European level. However, it is unreasonable to expect such courage from politicians alone. The politically active must get out of their issue-specific comfort zones – be they social policy, environmental protection or reducing inequality – and realise that their campaigns are rendered more difficult with open borders.

The protection and rebuilding of local economies and hence the re-establishment of local political control is the goal Europe must demand.

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Full text: http://www.theguardian.com/world/2013/dec/12/eu-open-borders-hamper-fairer-uk

Would you sign this Charter if the NFU and government rethink their GMO and food export drives?

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The National Farmers Union is urging the public to sign its charter and help to turn around a decline in self-sufficiency from 1991, when the country produced 75% of its own food, to the current production of 62%.

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It states that today, August 14, is the day British food supplies would run out if everything produced in a year was stored and eaten from January.

Producing as much of our food as we can is socially, economically and environmentally advantageous, but it will require middlemen to give food producers a transparently fair deal.

Two reservations:

The move to produce more food should not be used as a lever to introduce GM crops, supported by the NFU and government as this technology cannot be contained and would ‘infect’ crops of the same family grown many miles away, removing choice from conventional and organic farmers.

National and European governments should support the policy of greater self-sufficiency instead of prioritising food exports – see the 2012 delegation to China, headed by DEFRA minister Owen Paterson and Dacian Ciolos, the EU Commissioner travelling to China in July hoping to boost the global trade in food.

 

To sign the charter go to http://www.nfuonline.com/news/latest-news/nfu-campaign-calls-for-more-british-food/

 

 

 

Civil society ‘chalks up its first success’ in the Twitter Age; shades of things to come?

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Prem Sikka, Professor of Accounting at the University of Essex Business School sends the news that the Twitter age is about to chalk up its first success in the grey world of corporate accounting.

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In an article in The Conversation, he records that – for the first time – activists have demanded and secured a standard against the wishes of the accountancy establishment.

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Bloomberg has reported that the European Union will adopt country by country (CbC) reporting to enable citizens to scrutinise corporate practices and ask critical questions.  The aim is to make large companies disclose the taxes they pay and profits they make on a country-by-country basis.

Going through the usual channels

Meetings were sought with the more traditional accounting standard setters, such as the International Accounting Standards Board (IASB) and the Financial Reporting Council (FRC), but they showed no interest.

Sikka records that considerable opposition came from the professional accountancy bodies, major accounting firms and corporations. The Institute of Chartered Accountants in England and Wales was vehemently opposed to it. Deloitte said “we do not believe that imposing incremental country by country disclosure in financial statements prepared under IFRSs is warranted”.

A survey in 2010 did not show enthusiasm for CbC among FTSE 100 directors. The usual arguments were that disclosure would be costly, even though companies should already have the information about the performance of their subsidiaries in each country of their operation. The cost of publishing this internally held information is negligible.

The ‘civil society’ process

premIn 2003, Professor Sikka – as director of the Association for Accountancy and Business Affairs (AABA) – encouraged Richard Murphy of Tax Research UK, a chartered accountant, to make the first draft of a proposal that could highlight flight of capital, profits and the mismatch between profits, employees, assets and tax. The draft was published in later 2003 and has continued to be refined.

The main turning point was the support given by NGOs, such as Christian Aid, Publish What You Pay (PWYP), War on Want, Tax Justice Network, Oxfam and many others, in the UK, the EU, developing countries and the US. The credit for this must go to Richard Murphy. This campaign was joined by some Members of the European Parliament (MEPs) and also Labour MPs. Sikka adds:

“Much to the dismay of the accounting establishment, their pressure persuaded the EU to launch a consultation exercise in 2010 and has now resulted in partial implementation of CbC. No doubt, there is more to come”.

CbC is the culmination of a decade-long campaign by civil society organisations in the social media age. When fully enacted, it will be the first accounting standard formulated and developed by civil society rather than the traditional accounting standard setters.

He concludes that in the digital era it may well be possible to mobilise alternative centres of power . . .