Corporate Globalization and
the Global Gap Between Rich and Poor
by Robert Weissman
Multinational Monitor magazine,
July / August 2003
There is something profoundly wrong with
a world in which the 400 highest income earners in the United
States make as much money in a year as the entire population of
20 African nations-more than 300 million people.
Global inequalities persist at staggering
levels. The richest 10 percent of the world's population's income
is roughly 117 times higher than the poorest 10 percent, according
to calculations performed by economists at the Economics Policy
Institute, using data from the International Monetary Fund. This
is a huge jump from the ratio in 1980, when the income of the
richest 10 percent was about 79 times higher than the poorest
Exclude fast-growing China from the equation,
and the disparities are even more shocking. The income ratio from
the richest 10 percent to the poorest 10 percent rose from 90:1
in 19S0 to 154:1 in 1999.
Despite these numbers, there is a significant
debate among economists about whether overall global inequality
is growing in the era of corporate globalization. That is due
to the influence of China and India, huge countries which have
been growing (very rapidly, in the case of China) while most of
the developing world has been stagnant or shrinking economically
and most of the rich world has been growing slowly.
Economic inequalities between the richest
and poorest people in the world are clearly growing rapidly, however.
And, in most parts of the world, inequality within nations is
growing-this is true in the rich countries of the United States
and the European Union, most (but not all) of the transition economies
of the old Soviet bloc, China and India -or persisting at very
high levels, as in Latin America and Africa.
Much of the blame for this state of affairs
can be laid at the doorstep of corporate globalization-the rules
of the global economy as established by organizations like the
World Trade Organization, the imposed market fundamentalist demands
of the International Monetary Fund (IMF) and World Bank, the dynamics
of unregulated global financial and other markets.
There are other factors at work as well,
most importantly domestic power struggles over everything from
national tax policy to corruption to decisions over investment
in healthcare and education.
And not every aspect of corporate globalization
pushes in the direction of more inequality. For example, despite
the many and varied hardships corporate globalization imposes
on women, in many circumstances it may open up opportunities for
independence and economic self-sufficiency that traditional arrangements
denied to women.
But these caveats notwithstanding, corporate
globalization in many ways does generate, contribute to and reinforce
rising and persistent grotesque inequalities, both between and
within countries. Here is a review of a dozen mechanisms by which
1. FINANCIAL LIBERALIZATION AND ECONOMIC
Over the last decade, the International
Monetary Fund and World Bank have pressured countries to remove
restrictions on capital flows. The deregulation of the financial
sector has made it much easier to move money into developing countries.
In much of Asia and Latin America, and in Russia, foreign investment
funds have poured money into short-term investments in various
financial instruments. Capital flows to developing countries rose
from approximately $2 billion in 1980 to $120 billion in 1997,
a jump of 6,000 percent.
Deregulation has also made it easier to
move money out of countries. Because so much foreign investment
is lodged in financial instruments (as opposed to real property,
such as factories), it can easily flee developing countries. Deregulation
has displaced capital controls, including, for example, those
that might have required foreign investment to remain in a country
for a certain period of time. Such rules make it legal for foreign
investors to flee.
When things seem uncertain in a country,
foreign investors do flee, routinely. Even if the country's objective
economic circumstances are not in crisis, the fact of foreign
capital flight regularly plunges countries into crisis, or at
least crises worse than they would otherwise experience. This
has been the case over the last decade in Thailand, Indonesia,
South Korea, Russia, Brazil and Argentina, among other countries.
Financial crises in developing countries
exacerbate global inequalities-Argentina, for example, has seen
its economy sink rapidly in recent years, while Russia suffered
a 42 percent decline in Gross Domestic Product. They also tend
to increase domestic inequality, since the rich have various ways
to protect themselves, including by joining the capital flight
out of the country and housing their money in foreign banks. For
most of the middle class, however, such options may not be available,
and they may find themselves joining the ranks of the poor.
The developing countries collectively
owe $2.3 trillion to foreign creditors. Sub-Saharan African nations
owe more than $200 billion to foreign creditors. Developing countries
must pay interest on these loans and pay back the principal.
Where loans are directed to sound investments
in projects that generate foreign exchange-which is needed to
pay back the loans that are made in foreign currencies-taking
on debt obligations may make sense. But the history of the last
25 years is replete with large-scale lending operations from official
donors and private banks that have been allocated to boondoggle
projects (example: an unopened nuclear power plant on an earthquake
fault in the Philippines), wasted on military spending or siphoned
off by corrupt government officials.
Unfortunately, even bad loans have to
be repaid. Debt repayments suck money out of poor countries, denying
them monies that could be used for everything from healthcare
to delivery of clean water. Sub-Saharan Africa alone doles out
more than $10 billion annually in _ debt payments.
Amazingly, although the Third World debt
crisis has been a fixture of the financial press since the 1980s,
little has been done to address the problem. In better-off countries
that received large infusions of foreign loans which they are
unable to repay-such as Mexico, Argentina, Brazil, Korea and Thailand-private
lenders have written down the debts, accepting less than full
repayment, or extending repayment periods. For the poorest indebted
countries, a group of 42 Heavily Indebted Poor Countries (HIPC),
mostly concentrated in Africa, which owe most of their debt to
official creditors, the IMF and World Bank have fashioned a modest
debt relief program.
Both the public and private efforts have
treated the debt problem as one that requires financial restructuring
so that countries can continue to pay back debts-even if the debts
were illegitimately contracted (e.g., via loans to dictators),
even if there is no prospect of them ever being paid back in full,
and irrespective of the impact of payment on the debtor country.
In the case of the HIPC plan, the 42 countries
that owed $218 billion in 1996 now owe $180 billion. Countries'
annual debt payments-the thing that matters most, since it is
the amount they actually pay, rather than the total amount they
owe, which is likely never to be repaid- have fallen very modestly
under the HIPC plan, by about a quarter. A little more than half
of the HIPCs have received some relief under the debt relief plan-but
about half of them maintain debt obligations that even the World
Bank defines as unsustainable, according to Jubilee Research of
The benefits flowing from the stingy levels
of debt relief that have been granted show what could be done
with full debt cancellation.
"While the money released so far
is modest-much more is needed through deeper debt cancellation
and increased aid-on a local level, the difference it is making
to individual people is tangible," concludes "Reality
Check," a report by Drop the Debt, a debt campaigning group,
issued in 2001. "With scarce resources, not everything can
be done at once. In Uganda, new schools have been built, and primary
education is now free, which has prompted a huge rise in attendance
rates, but the country desperately needs more teachers and materials
to maximize the benefits. In Mozambique, there are more health
clinics and nurses, but still a lack of drugs for them to work
3. ELEVATED INTEREST RATES
In an era of globalizing financial markets,
the very high interest rates pursued by the U.S. Federal Reserve
in the 1980s meant that the rest of the world would be forced
to adopt high interest rates as well.
Although rich countries have steadily
reduced interest rates over the last decade, globalized financial
markets have led developing countries to maintain high rates.
Given the greater risk in developing countries, free-flowing capital
demands a higher rate of return. Particularly in the wake of financial
crises or near-crises, developing country interest rates have
risen to extremely high rates-all in an effort to keep capital
On top of these market demands comes pressure
from the International Monetary Fund on developing countries to
maintain high interest rates, and not to take steps that could
stem capital flight while enabling interest rate reductions. Under
such pressures, the new Brazilian government of Lula is maintaining
interest rates of 26 percent.
The impacts of high interest rates on
inequality-both between and within countries-are severe.
The elevated global rates in the 1980s
plunged Latin America into the debt crisis, as interest rate payments
on its foreign debt soared.
The high rates that developing countries
have maintained have led to a steady flow of interest payments
out of the Third World; and, when it has appeared that countries
cannot continue to meet foreign debt payments, foreign capital
has fled, throwing nations from Thailand to Argentina into crisis.
High interest rates have dramatically
slowed economic growth in developing countries. In Brazil, now
led by a populist president, high interest rates have left growth
rates near zero.
And, within countries, high rates have
significantly exacerbated wealth inequalities.
"We know that the distribution of
assets in each country is very skewed, and the rate of interest
is the return on the assets," says Branko Milanovic, a World
Bank economist, in the interview in this issue. "So within
each country the rich gained from higher interest rates. On the
world level too, rich countries which are by definition capital-rich
gained from it. It is of course the rich people in rich countries
who gained the most."
4. TRADE LIBERALIZATION I - EXPANDING
Trade liberalization has heightened differences
among 1 wage earners. Unskilled workers in developing countries
and industrialized countries alike have been particularly hard
hit by international competition. The UN Conference on
Trade and Development (UNCTAD) reported
in its 1997 Trade and Development Report that "in almost
all developing countries that have undertaken rapid trade liberalization,
wage inequality has increased, most often in the context of declining
industrial employment of unskilled workers and large absolute
falls in their real wages, of the order of 20-30 percent in some
Latin American countries."
The growing gap in wages between skilled
and unskilled workers maybe explained in part by extremely intense
global competition to perform unskilled work (think of the apparel
and shoe companies that switch from sweatshops in Mexico to El
Salvador to Indonesia to Bangladesh and China in constant search
of cheaper labor).
"As a result of increased participation
of several highly populated, low-income countries in world trade
in recent years, as much as 70 percent of the labor force employed
in sectors participating in world trade is low-skilled,"
reports the 2002 UNCTAD Trade and Development Report. But because
there remains so much surplus labor in developing countries, and
because many large countries, notably China and India, are still
not fully integrated into the global economy, downward pressure
in low-skilled wages is likely to continue for the foreseeable
future, UNCTAD concludes.
5. TRADE LIBERALIZATION II - DIVIDING
THE PIE BETWEEN CAPITAL AND LABOR
The downward push in labor costs has worked
to corporations' advantage. Due to trade liberalization, UNCTAD
stated in 1997, "capital has gained in comparison with labor,
and profit shares have risen everywhere. In four developing countries
out of five, the share of wages in manufacturing value added today
is considerably below what it was in the 1970s and early 1980s."
Some of the increased share for capital
is going to corporations in developing countries, exacerbating
domestic inequality. Much of it is collected by corporations and
their owners in industrialized countries, both from the share
they are taking from workers in rich countries, and from those
in the Third World. While multinational corporations have taken
advantage of freer trade regimes to locate production facilities
in developing countries, they maintain control of all of the high
value-added design and technology.
6. AGRICULTURAL DUMPING AND AGRICULTURAL
Grain-trading companies from rich countries
are increasingly flooding developing countries with below-production-cost
food exports. Companies such as Cargill benefit from market arrangements
(especially highly concentrated markets among the trading companies
) that drive prices below the cost of production, and enable them
to buy and export grains at super-cheap prices to poor nations.
Sometimes the trading companies benefit from subsidies that are
targeted just to exports.
"Below-cost imports drive developing
country farmers out of their local markets," notes a February
2003 report from the Institute for Agriculture and Trade Policy
(IATP). "If the farmers do not have access to a safety net,
they have to abandon their land in search of other employment.
This is happening around the world, in places as far apart as
Jamaica, Burkina Faso and the Philippines."
The IATP report documents widespread and
extreme levels of dumping by the United States. IATP researchers
report the cost of production for a bushel of wheat in 2001 was
$6.24, while the export price was only $3.50-a 44 percent level
of dumping. In 2001, U.S. exporters dumped corn at 33 percent,
soybeans at 29 percent, cotton at 57 percent and rice at 22 percent.
Hypothetically, WTO rules should prevent
such dumping, but poor countries generally do not have the capacity
to bring complicated cases before the world trade body, and dumping
cases in particular turn on very elaborate and empirical economic
Instead, free trade rules have significantly
contributed to the problem of dumping. Global trade rules, and
especially International Monetary Fund and World Bank conditions,
have required developing countries to remove tariffs on agricultural
imports. That has left them vulnerable to accepting the international
market price-even if it is the product of a rigged system, and
even if it impoverishes the countries' farmers and drives them
out of their livelihoods.
Along with the command to open their markets
to food imports, the IMF and World Bank have pressured developing
countries to orient their agricultural sector (along with the
rest of their economies) to exports. Instead of growing food for
local consumption, the Fund and Bank instruct,
developing countries should encourage farmers (with subsidies,
technical advice and other assistance) to grow produce and other
agricultural products-from coffee to flowers- for sale in rich
In practice, exports usually favor plantations
and large-scale farmers. Small farmers often cannot meet the quality
standards demanded by rich country supermarkets; they cannot get
their products to market fast enough to serve consumers thousands
of miles away; and they do not produce in great enough quantity
to make it economically rational for multinational food traders
to deal with them.
7. LABOR MARKET "FLEXIBILITY"
The IMF and World Bank have pushed developing
countries to undermine worker protections in the name of promoting
labor market flexibility. The idea is to deregulate the labor
market-to make it easier to hire and fire, to remove wage protections,
to diminish standards contained in collective bargaining agreements-so
that employers have more freedom to maneuver. This kind of deregulation
is aimed at freeing up entrepreneurial spirits and promoting economic
Undermining worker power and protections
does give employers more room to maneuver, but there is little
evidence that this translates into economic dynamism rather than
greater worker exploitation-taking money from workers and giving
it to management.
In fact, as even the World Bank has noted
in formal statements that do not translate into policy, unionization
not only tends to enhance worker earnings and reduce wage inequalities,
it enables a more stable and productive workforce that provides
the foundation for a faster-growing economy.
An April 2003 statement by the International
Confederation of Free Trade Unions (ICFTU) notes numerous Bank
and IMF interventions to undermine worker protections:
* "In Croatia, the Bank and the Fund
have been pressing the government to reduce worker protection
on the grounds that, as the Bank's country director has stated
publicly, reduced protection will automatically result in higher
economic growth rates."
* In Colombia, the IMF complained in January
2003 that labor market reforms do "not go far enough"
because the minimum wage is still indexed to the cost of living.
* Even for Germany, the ICFTU notes, the
IMF has recommended "wage moderation," an "aggressive
elimination of spending on active labor market policies"
and reduced unemployment benefits.
In the context of government employment,
IMF and Bank policies often explicitly favor inequality, as they
urge nations to pursue a policy of "wage decompression,"
especially in the public sector. That translates into expanding
the gap between low-paid and high-paid employees, on the grounds
that higher level officials need to be paid more to retain talented
and well-educated staff. In the case of poor countries, where
the public sector often represents a significant portion of formal
employment, such wage decompression policies can have a discernible
impact on domestic inequality.
8. INTELLECTUAL PROPERTY PROTECTIONS
The World Trade Organization requires
member countries to provide U.S.-style patents for all inventions,
as well as copyright and trade secret protections.
Since the overwhelming amount of research
and development occurs in the rich countries, the vast majority
of patents are filed by inventors in rich countries, and most
important patents are controlled by rich country corporations.
In Mexico in 1996, for example, 389 patents came from domestic
residents, while more than 30,000 came from foreign residents,
mostly in the United States and European Union.
Patents enable the owners to extract royalties
and monopoly profits from users-irrespective of whether they are
industrial users or consumers-of the patented product. Given the
disparity in patent filings, global patent rules force a transfer
of royalty payments from poor to rich countries.
The World Bank estimates the United States
will net an additional $19 billion a year thanks to WTO-required
patents and Japan an additional $5.6 billion, with most of Europe
gaining a considerable amount as well. The Bank projects WTO-required
patents will cost China more than $5 billion a year, Mexico $2.5
billion annually, and Brazil $500 million a year.
Copyright protection is also increasingly
important, as it applies to the content provided over the Internet,
as well as movies, books, records and computer programs. The disparities
work in the same fashion as for patent privileges, with copyright
creating a steady stream of royalty payments from developing countries
to the industrialized world.
The costs of intellectual property protections
cannot all be measured in static dollar figures. Patent protections
for pharmaceuticals are contributing to the denial of essential
medicines for millions in developing countries, including for
HIV/AIDS treatment. And WTO rules will block developing countries
from emulating the example of the United States and most of the
industrialized world, which sped their technological development
by copying inventions from elsewhere.
9. PRIVATIZATION - CONVERTING PUBLIC WEALTH
TO PRIVATE PROPERTY
Perhaps it is not inevitable that privatization
increases 1 inequalities. If publicly owned property is sold for
a legitimate price reflecting actual market value, then there
should be no transfer of wealth from the government to private
parties. Or if shares in privatized properties are distributed
evenly throughout the population, then everyone gains a direct
ownership stake in what they once owned indirectly through the
But the reality of privatization in the
developing world has rarely matched the sanitized story told in
theory. The norm has been undervalued sales, so that public assets
are transferred to new private owners-sometimes multinationals,
frequently local elites-at prices far below market value. In some
cases, privatization has been marked by extreme corruption that
has created a small class of billionaires who simply looted the
Russia Is perhaps the most extreme case.
The Russian gas giant Gazprom was privatized for $250 million.
Three years later, Gazprom's market valuation was $40 billion.
Based on its reserves, if it were valued as a company would be
in the United States, where property rights are more secure, it
would be worth between $300 billion and $900 billion. Oil, mining,
electricity and other companies were privatized at prices sometimes
less than a twentieth of their subsequent market value.
Thus were created the handful of Russian
oligarchs who came to dominate the national economy, even as the
nation sunk into an economic decline of epic proportions. Rising
oil prices have helped the national economy recover since the
late 1990s, but the country remains marked by a spectacular concentration
of wealth. The country now has 17 billionaires. Writes Paul Klebnikov
of Forbes magazine, "Considering the modest size of the Russian
economy these days, Russia may well have the highest billionaire-to-GDP
ratio in the world."
The likely runner up in the billionaire-to-GDP
contest is Mexico, which claims 11 spots on Forbes' list of billionaires.
As in Russia, the Mexican billionaire class saw its fortunes rise
thanks to a series of large-scale privatizations that took place
under shady circumstances, many under the corrupt Salinas regime.
Looking at the global experience with
privatization but relying especially on data analysis of Eastern
Europe and Latin America, two former World Bank officials conclude
in a Center for Global Development report that "privatization
programs appear to have worsened the distribution of assets and
income, at least in the short run."
10. WATER AND OTHER SERVICE PRIVATIZATION
One of the World Bank's present fads is
water privatization. Clean drinking water is a basic need for
survival, but widely unavailable in poor countries. Having failed
with an array of top-down interventions, the World Bank has decided
that the solution to the water service provision problem is privatization.
There are two key flaws in the Bank's
devotion to privatization. First, it ignores the alternative:
effective public sector water delivery. As the UN Development
Program's Human Development Report 2003 points out, a number of
developing countries operate successful public sector water systems.
Most rich countries rely on the public sector for water delivery.
The second flaw in the Bank's disposition
to privatization is that improving and expanding water services
to poor people is not profitable. The global water companies that
are supposed to improve water service provision in developing
countries have no interest in providing water to rural communities.
These communities need boreholes and community delivery, not connections
to central water systems. The costs are too high and the paying
capacity of the people there too low to interest the water multinationals.
Nor do the water companies generally care to expand pipe systems
in urban settings, for the same reason-costs are too high, and
the urban poor who are typically not connected to the piped system
can't pay enough.
What does appeal to the multinationals
is providing service to the urban middle class, and charging them
higher fees. Indeed, the Bank and other privatization purveyors
often want private companies to take over water systems in part
so that they can raise prices.
And they do. "Privatization in water
and sanitation has led to much higher fees, sometimes overnight-and
sometimes with disastrous consequences," says the Human Development
The significant impact on inequality from
privatization is not due to the profits extracted by the multinationals
that take over developing country systems. These are inconsequential
on a global scale. What does matter in global terms is the reduction
in quality of water service, and the lost opportunity for investments
in a public system that could raise efficiency and expand access.
Reduced quality water service contributes to the spread of avoidable
disease among the poor, but not better-off groups that can afford
to pay for clean water, either from the piped system or from private
water vendors. It imposes enormous time and labor burdens on poor
families-overwhelmingly borne by women and children-to collect
water from far-off points and carry buckets back home. No well
off person ever experiences such hardships.
The World Bank has long advised developing
countries to impose charges for accessing primary healthcare and
education. Although the Bank has now reversed itself on primary
school fees, and recommends against fee-for-service arrangements
for basic healthcare, it does not actively oppose healthcare fees.
The legacy of Bank advocacy in these areas remains strong; user
fees for basic healthcare and education remain the norm in poor
User fees deter usage. "User fees
have great potential for impoverishing users and deterring people
from using badly needed services," concludes the UN Development
Program's Human Development Report 2003. School fees deter families
from sending their children to school. Clinic fees keep sick people
at home, and away from treatment or preventative services. Even
very small charges have a major deterrent effect on poor people's
access to primary healthcare and education.
"In Ghana, two-thirds of rural families
cannot afford to send their children to school consistently,"
according to the Human Development Report 2003, "and for
three-quarters of street children in Accra (the capital) the inability
to pay school fees was their main reason for dropping out."
There are endless examples of the same
phenomenon in healthcare. In Papua New Guinea, for instance, the
introduction of user fees led to a decline of about 30 percent
in the average monthly attendance at outpatient health centers;
in Kenya, introduction of small fees for a sexually transmitted
disease clinic in Nairobi led to a decline in attendance of 40
percent for men and nearly two-thirds for women.
One attempted remedy to these problems
are exemptions from charges for the poor. But these have proved
to be administratively difficult and have failed to ensure access
for the poor.
Removing user fees has an immediate and
tremendously beneficial effect. With the Bank's recent reversal
on education user fees-which followed a U.S. Congressional mandate
for the U.S. representatives to the IMF and Bank to oppose loans
that included user fees on primary education or healthcare-countries
are beginning to change policy. Tanzania, Uganda and Kenya have
all recently eliminated school fees-and have seen a massive surge
in school attendance. In Tanzania, three quarters of a million
children-mostly girls-previously barred from the classroom because
they could not pay charges are now attending school.
User fees create disparities between rich
and poor in access to basic services-better off families are able
to pay the charges-and in basic life conditions. Children who
do not go to school will, on the whole, be consigned to a much
more difficult future than those who are educated. User fees leave
poorer people sicker and weaker. They are left to suffer from
avoidable pain and suffering, to live shorter lives, and to live
their lives with diminished earning capacity due to physical limitations.
12. UNEQUAL DISEASE BURDENS AND ECONOMIC
The global toll of disease is wildly uneven.
People in rich 1 countries tend to die of diseases of affluence
or diseases that strike later in life, such as heart disease and
cancer. People in poor countries die in great numbers from the
diseases of poverty - diarrhea, HIV/AIDS, malaria, tuberculosis,
among others-that take relatively little or no toll on rich country
To a considerable extent, the disparity
is a reflection of wealth inequalities. Diarrhea kills more than
a million children a year in developing countries, simply because
their families lack access to clean drinking water.
Undernourishment would ideally be solved
by ensuring everyone has access to an adequate food supply; but
just the supply of micronutrients could have huge benefits. According
to the U.S. advocacy group Results, "Vitamin A supplementation,
in the form of a capsule costing two cents given to a child two
to three times a year can cut child deaths by 23 percent. There
are initial indications that giving vitamin A to pregnant women
in developing countries could reduce maternal death rates by 40
to 50 percent. Iodine deficiency is the largest preventable cause
of mental retardation worldwide; salt iodization could prevent
this at a cost of five cents per person."
Economic disparities also affect the incentives
for private parties to take action to redress health inequities.
One particularly important example is in the area of disease prevention
and treatment. Rich country governments tend to invest in research
and development to prevent and treat diseases that affect their
own people; developing countries have minimal resources to invest
in R&D. Private drug companies have no incentive to invest
R&D funds in vaccines or drugs for diseases endemic to poor
countries, because even though there is great need, there is no
sizeable market for such products. MSF/Doctors Without Borders
calls this the problem of "neglected diseases," and
points to the 90/10 problem-90 percent of medical research is
devoted to diseases that affect only 10 percent of the population.
Virtually no research is devoted to diseases, such as sleeping
sickness, Chagas' disease and visceral leishmaniasis, that only
affect developing country populations.
Inadequate healthcare systems in developing
countries- in part due to user fees and foreign debt payments
that drain funds for public healthcare, both issues mentioned
previously-exacerbate the health challenges facing poor people.
Corporate globalization itself also in
some circumstances contributes to problems of disease spread.
In the case of HIV/AIDS, for example,
rural displacement and social disruption have been key vectors
of the virus. With agricultural liberalization, imports undermine
local farmers. Export-oriented policies have further discriminated
against small farmers in favor of large plantations. The resultant
displacement of the rural population has contributed to migration
and urbanization. Many men leave rural villages for work in big
cities or in mines, contract HIV/AIDS from casual sex partners
or sex workers, and then spread the disease to spouses in their
home village. The displacement of children and young women into
the cities has led to a sharp increase in commercial sex work
and heightened rates of HIV/AIDS.
So too has foreign investment in resource
extraction created the social conditions to spread HIV/AIDS. For
example, the construction of the Chad/Cameroon pipeline- undertaken
by a consortium of oil companies led by Exxon/Mobil-is requiring
the construction of roads and truck routes from Cameroon, where
HIV prevalence rates are high, into Chad, where they are low.
Experts funded by the World Bank concluded that the operation-even
if HIV/AIDS education programs are put into place and succeed
in reducing transmission rates by 80 percent-will result in 100
AIDS-related deaths per year. Trucking the pipe over 1,000 miles,
"drivers were to pick up their loads, and stay with their
truck-including tractor and trailer- for the duration of the trip
which would involve three overnight stops," writes William
Jobin, part of the expert team paid by the Bank to look at social
and environmental concerns surrounding the pipeline, in the Bulletin
of the World Health Organization. "This pattern is ideally
suited for transporting the AIDS virus into the interior of southern
The HIV/AIDS pandemic is now so severe
in many areas that it is itself becoming a cause of greater global
inequality, as it decimates the most economically productive members
of whole societies. "HIV/AIDS first took hold in countries
in the [Southern African] region one to two decades ago and has
been steadily targeting healthy, productive adults ever since-especially
the people who produce, transport and market crops and those who
gather and prepare food for households," and especially women,
write UN special envoys James Morris and Stephen Lewis in a March
2003 report. Morris and Lewis conclude that HIV/AIDS is a significant
contributing cause of the food crisis now facing Southern Africa-too
many farmers, particularly women, are either too sick to plant
and harvest, or have already died.
Corporate globalization-in the form of
the globalizing multinational tobacco companies-is also contributing
dramatically to the spread of cancer, heart disease and other
tobacco-related disease from rich to poor countries. More than
4 million people die annually from tobacco-related disease worldwide;
the World Health Organization estimates the total will rise to
10 million annual deaths by 2030. While tobacco-related disease
has historically been concentrated in the rich countries, WHO
estimates that 70 percent of the deaths will occur in developing
countries within two-and-a-half decades time.
Smoking rates are historically high among
men in many developing countries, and with greater wealth in Asian
nations, tobacco consumption would rise on its own, without any
But there is external prodding. And it
is making things worse.
The tobacco multinationals' future rests
on their ability to make sales in developing countries. As they
have rushed into developing country markets, they have introduced
slick marketing and promotion strategies that not only attract
current smokers, but hook new ones. Smoking rates among men are
very high in most of Asia, but very low among women. Entry of
the multinationals has led to major surges in smoking rates among
children and women. After the South Korean market was opened to
U.S. companies, for example, smoking rates among girls quintupled
in a single year.
The health-related burdens and suffering
in developing countries that flow from absolute poverty, neglect
and unequal processes of corporate globalization are cumulative.
People get sick younger and more often. Often, there is no infrastructure
to treat them or alleviate suffering. Where there is, it is frequently
priced out of reach. Families spend down their savings or borrow,
leaving them economically insecure. Or, they ration treatment
among themselves, or forego it altogether, leaving them physically
weaker and less able to care for themselves.
These are the ravages not just of poverty
but of a system where unregulated, or corporate-regulated, global
and domestic markets produce horrifying inequalities in the basic
conditions of peoples' lives.