By Kelly Hilditch
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Sugar — a sweet and deadly multinational racket

This article is over 17 years, 3 months old
Our series on commodities turns its attention to the global sugar trade
Issue 1949

Sugar is as much bound up with the history of slavery and colonialism as cotton, which this column looked at last week.

The sugar trade began in 1493 when Christopher Columbus first carried sugar cane from the Canary Islands in the eastern Atlantic to the so called New World — the Caribbean and Americas.

Sugar production was based on slavery — and it is to that brutal forced labour that companies such as Tate & Lyle owe their fortunes today.

Another form of unfree labour was deployed in colonised Australia. In the 19th century South Sea islanders were often kidnapped and forced into indentured labour — a form of binding contract — for a minimum of three years on the sugar plantations of northern Australia.

Since then sugar production has come to take place in a thoroughly capitalist fashion — just like cotton. But the key difference is that the commodity produced is deadly.

Obesity is a growing problem in the West, and sugar is an important part of the problem. It makes up a significant part of people’s diets — from the obvious sweets and fizzy drinks to the hidden sugar in prepared meals.

World Health Organisation (WHO) research for two health reports — in 1990 and 2003 — recommended that sugar should make up no more that 10 percent of a healthy diet. But the nutritional plan of action in the 1990 report failed even to mention sugar.

It’s not hard to discover why. In 1978 Coca-Cola set up the innocuous sounding International Life Sciences Institute.

It quickly gained backing from other food conglomerates — PepsiCo, General Foods, Kraft, and Proctor & Gamble — all of which promote sugar consumption as part of processed food.

Incredibly, the institute gained accreditation to the WHO and to the UN’s food and agriculture organisation. That put the multinationals in a strong position to influence the recommendations made by those organisations.

The sugar industry claims that international experts who decided on the 10 percent limit used scientifically flawed techniques. It insists other evidence indicates that a quarter of our food and drink intake can safely consist of sugar.

In a letter to the director of the WHO, the Sugar Association stated, “If necessary we will promote and encourage new laws which require future WHO funding to be provided only if the organisation accepts that all reports must be supported by the preponderance of science.”

That amounts to a threat — “Either use our tame researchers, or we cut the US’s $406 million funding of the WHO.”

Funding is not a problem for the sugar industry itself. It is the beneficiary of vast subsidies in the advanced capitalist countries.

The Common Agricultural Policy in the European Union (EU) produces an annual harvest of subsidised profit for food processors and big farmers. That perpetuates unfair trade between Europe and the developing world.

The European sugar regime is a notoriously complex system, but it produces a problem that can be very simply stated — too much sugar.

Each year, the continent generates an export surplus of approximately five million tons. This surplus is dumped overseas through a system of direct and indirect export subsidies, destroying markets for sometimes more efficient producers in the process.

It costs twice as much to produce sugar from the beet grown in Europe than from the cane grown elsewhere.

High trade barriers keep imports out of Europe. The result is that the EU is spending £3.30 in subsidies for every £1 worth of sugar it exports. Meanwhile domestic prices are maintained at three times those on world markets.

The whole system amounts to corporate welfare at the expense of consumers and tax payers in Europe, and of producers in poorer parts of the world.

The EU likes to boast that it allows the very poorest sugar producing countries to export to Europe. But this export permit is limited to 1 percent of the volume of EU sugar consumption.

In other words, a group of 49 of the world’s poorest countries are allowed to supply Europe, one of the world’s richest regions, with only four days’ sugar consumption a year.

Last year Mozambique and Ethiopia, two of the world’s poorest countries, could export less sugar to Europe than 15 of the biggest sugar farms in the county of Norfolk.

None of this stops the World Bank and the IMF telling poorer countries to produce commodities like sugar, supposedly to trade their way out of poverty.

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