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BPS IV-1
1980s
Under the guidance of key governments in the US and Europe, the World Bank
initiated market-opening structural adjustment loans and the IMF used the
opportunity of the Third World Debt crisis to press countries to export even more.
Poorer countries pushed to open their markets to financial firms. These efforts
built on agriculture sector modernisation reforms which started in the 1960s,
whereby technologies like the green revolution promoted vulnerability in
agriculture as farmers were enticed to modernise by borrowing money to
purchase imported chemical fertilizers, pesticides, and even seeds.
1990s
Neoliberal model ignored the fact that market-opening policies might leave
countries tragically vulnerable to external shocks. This shock did appear in the
Asian financial crisis that started in Thailand in 1997 and had spread around the
world.
2007
Many countries like the Philippines and Trinidad and Tobago, once self-sufficient
in food, became dependent upon imports even for their most basic cereal needs.
Too many countries struggling with the over-exploitation of their forests, fisheries
and minerals, and were suffering from the drought, flooding and uncertainty of
climate change.
2008
Global food price crisis that spread around the globe in September and October.
Environmental crisis of water and other resources also shook the world. The
crisis began on Wall Street when years of US banks offering misleading
mortgages to millions of people provoked crisis as many homeowners found it
difficult to keep up payments on those mortgages. Confidence of Wall Street
began to spin out of control in September, and several banks went under. Panic
spread across borders into a wide range of countries that had been encouraged
to open up their financial systems to foreign money flows and to banks based in
the US and Europe. While the crisis was deepest in the richer countries, it spread
beyond, hitting nations that had most opened their financial markets, that were
most dependent on the US, and Europe for trade and investment flows.
Summed up economic impact of the financial crisis in 2010 by The United
Nations Development Programme (UNDP):
Unemployment and poverty worsened sharply:
-34 million people lost their jobs
-64 million people fell under the $1.25 a day poverty threshold
The opening of markets was an advantage to the colonial powers. While economists,
politicians, and business leaders claimed that, those policies would lower prices, help
workers and bring prosperity. However, they underplayed its harmful impact on working
conditions, the environment, equality and democracy themes that became central to a
spreading critique of the model.
Brief overview of the three main crisis: Food, Finance, and Environment
Food prices are influenced by many factors, from weather to consumption habits to
speculators on futures exchanges. Throughout history, there have been periods of
volatility, but the adverse impacts of food price hikes have spread as agricultural trade
has grown. Many countries once self-sufficient in food depend heavily on imports. Price
of many food commodities rose in 2006 and 2007 and spiked early in 2008.
Walden Bello pointed out the devastating impact: By the end of 2008, the United
Nations reported that the annual food import basket in LDCs cost more than three
times that of 2000, not because of the increased volume if food imports, but as the
result of rising food prices. These developments added 75 million people to ranks of
the hungry and 125 million into extreme poverty.
For poorer nations, the food price hikes were combined with the 2008 global financial
crisis. These two crises (food and finance), interacted in many countries with another
problem that had been building around the world: Crisis of the environment. Wherein
the decades of development that encouraged countries to export food, fish, minerals
and forest product affected the worlds natural resources in which most countries were
suffering from the depletion. Industrial activities and heavy fossil fuel use sped up
climate change and its impact through rising sea levels and increasingly unpredictable
weather patterns, hitting many poorer nations hard.
The relation of triple crises
The post-2008 vulnerabilities faced by many communities and nations were the result of
conscious policies. Nations were vulnerable to food price hikes because policies
encouraged food imports. Nations were vulnerable to financial crisis because their
banking systems where consciously opened to global hot money flows. Countries
forests and fishing grounds were consciously opened to foreign firms.
This call for a new framework for development that places vulnerability at the
center of the critique. There have been alternative frames of development before
that centered on human rights, ecological balance, and living democracy, but the
paper contends that these frames can be combined and adapted to this
vulnerable era under the frame of rootedness.
Literatures on Vulnerability
It ignores the issue of vulnerability. It claims that: it can prove that open free
market politics will lead countries to focus exports on their relative comparative
advantage, which creates the maximum economic gain in the most efficient
manner. At an individual level, the theory subsumes vulnerability under its
category of risk and sees risk-taking behaviour as a potentially good thing:
individuals who are the least risk-averse stand to be rewarded the most, and
James Scott
Argued that one needs to focus on the moral economy of the peasant to
understand that what the neoclassical economists view as primitive and irrational
behaviour is actually sophisticated and rational; that small farmers are primarily
focused on meeting the subsistence needs of their families and are, hence,
rationally risk-averse. Scott found that farmers avoid changes that might increase
their vulnerabilities; farmers embrace changes only when they see a virtual
Various parts of the United Nations have worked more concretely on the
measurements on the types of vulnerability. One of these is the UNU-WIDER that
work to develop concepts of vulnerability at micro and macro levels. At the micro
(individual) level, UNU-WIDER focuses on the risks that lead to individuals or
households falling into poverty. At the macro (country) level, it focuses on
vulnerability to both natural crises, like earthquakes, and human-made crises like
Concept of Subsidiarity
It is necessary to create new rules and structures that consciously favour the
local and follow the principle of subsidiarity that is, whatever decisions and
activities can be undertaken locally should be Only when additional activity is
required that cannot be satisfied locally should power and activity move to the
next higher level, that of region, nation, and finally the world.
sustainable and 'rooted organic farming practices. There were groups and institutions
established to further understand the community and household level better.
1. Davao Provinces Rural Development Institutes (DPRDI) - helps farmers adopt a wide
range of natural fertilisers and pesticides that demonstrate a sophisticated
understanding of natural systems.
2. Philippine Rural Reconstruction Movement - launch a large Go-Organic coalition in
2009 that aims to increase organic rice farming to 10% of the Philippine total.
3. Rice Watch and Action Network (R1) - provides policy ideas to encourage the
government, with its army of agricultural extension workers and its key role in upgrading
irrigation canals, to transform its role to support organic, local agriculture. Reinforcing
James Scotts finding about the rational risk-averse nature of small farmers, the authors
showed that farmers shifted to organic rice only when the benefits were clear and
demonstrated. They suggested that sustainable farming in the Philippines is positive
socially, environmentally and economically on a local level because it: leads to more
social cohesion and rootedness at a local level reduces debts reduces the power of rice
traders, of middlemen, and gives more social power to people. How was the national
government responded to this particular shift towards a more rooted future? The new
administration (Benigno 'Noynoy' Aquino) under pressure from farmers and nongovernmental groups, had passed an Organic Agriculture Act in April 2010.The act
mandates the government to promote and further develop the practice of organic
farming in the Philippines, in part through farmers and consumers education, but very
little funding was passed. The president also appointed a major advocate of organic
farming, Proceso Alcala, to be a Secretary of Agriculture. Then again, under pressure
from farmers and advocacy groups, the government created a National Rice Board
made up of people from all parts of the rice sector to work out an action plan to pursue
their goals.
A Carribbean island nation with ample fossil fuels and a very open economy. It became
the largest economy in the Carribbean. When the large oil exporting nations quadrupled
the price of oil in 1973 and again in 1979, Trinidad and Tobago and the many foreign oil
firms there reaped some of the windfall. Having won independence from the British in
1962, the postcolonial government ploughed the new revenues into more exploration
and transformed the capital city into the financial centre of the Caribbean. And also, it
invested in heavy industry. Through this, the following happened: Leaving farmers and
fishers by the wayside, Farmland was abandoned, Artisanal fishermen, who were given
subsidies to expand in the 1950s, were largely forgotten, Finance, industry and tourism
were the considered as the future, The government also built high-end tourism aimed at
Europeans on Tobago, which likewise brought in foreign exchange. The development of
Trinidad and Tobago lead to its vulnerability when in 2009, most of its earnings came
from oil, gas, finance and tourism wherein US served as Market. Moreover, oil, gas,
finance and tourism all proved extremely vulnerable to the shocks of 2008, to the extent
that the countrys economy plunged into negative growth in 2009, with its GDP falling
3.5 per cent that year. Hence, after years of neglecting small-scale fishing and
agriculture, the country imports most of its corn, rice and wheat. To counter the struggle
of Trinidad and Tobago, it elected a new reform government led by Kamla PersadBissessar wherein there were signs of more receptivity to rooted alternatives. In line
with the reforms to defeat vulnerabilities be deepened, there were small acts
constructed. The most high-profile of these involved the planned construction of:
Multibillion Dollar Aluminium smelter - that would have processed bauxite from nearby
Guyana and exported the finished product to countries like China. Fisher groups and
other activists opposed it and invoked a 1995 Environmental Impact Assessment law.
Hence, new government of Persad-Bissessar cancelled the contract in mid-2010. Longstanding fight over a road not built - there is a 17-mile roadless stretch in the middle of
the northern coast, filled with gorges, rivers and bays, which makes road construction
difficult. Some think that it would help people in the northeast get their products to the
capital city. It would integrate the north coast, and it would make money for developers.
However, some farmers and fishers said that they blocked it for reasons that range from
biodiversityto fishing to keeping the communities intact. In view of the battles over
of its exports goes to US. From this instances, when the market declines (US), its tradedependent countries will get affected. On the other hand, Brazil represents a more
rooted trade model, and it fared better in the crisis because its trade exports represents
a low percentage of GDP.
c. Openness of Economy
The openness to the global economy of a certain country can be a measure in terms of
liberalisation of trade, investment and financial flows. In terms of rootedness, it is
important to measure the country's financial, trade and legal protections to help national
enterprises and restrict foreign enterprise. For example, agreements between countries
and institutions like WTO that can limit countries' ability to favour National over global
firms.
d. Dependence of Country on Food Imports vs. Food Sovereignty Food Sovereignty
It exists in a country when its people consume safe and nutritious food largely grown by
its own small farmers. Since food is central to well-being, and since governments and
the public are increasingly understanding the dangers of over-dependence on food
imports, it is critical to measure the dependence of countries on food imports and the
overall availability of safe and affordable food for the population. Example: Trinidad and
Tobago imports all its wheat Philippines perennially one of the world's leading importers
of rice.
Environmental
a. Ability of nations to protect environment and ecosystems into the future
Environmental Sustainability - that rank countries from Finland, Norway and Uruguay on
the sustainable end to North Korea, Taiwan and Turkmenistan on the unsustainable
end. These measure each countrys natural resource endowments, its resource
extraction rates, its pollution flows and the policy responses.
b. Resource depletion - This indicator put emphasis on the speed at which a country is
depleting its forests, fisheries, biodiversity and other natural resources. This is a key
indicator of the potential of communities to pursue more rooted paths. For example, we
found that small-scale fishers in the Philippines face a great deal of damage to
mangroves and coral reefs, which has hurt fish stocks, whereas fishing grounds are less
degraded in Trinidad. This offers small fishers in Trinidad more rooted options.
c. Fossil fuel dependence Trinidad and Tobago and other countries that are endowed
with fossil fuels, both pollution and the volatility of oil and gas prices erode rooted
alternatives. However, Philippines, with limited or no fossil fuels, the dependence on
imports with volatile prices also poses great challenges for rootedness. It is in the nofossils countries that the transition to sustainable agriculture, free from fossil-fuel based
inputs, is most attractive on a cost basis.
d. Water scarcity Water is as vital as food for human survival and well-being. In some
countries, like Madagascar, Ethiopia and Afghanistan, less than half the population has
access to adequate water services.
e. Vulnerability to climate change Island nations and countries with large amounts of
farm land near oceans, like the Philippines, are particularly vulnerable.
Social
a. Availability of sustainable livelihoods and social safety nets - The key issue for most
households is the availability of livelihoods for family members and the existence of
government safety net programmes for those without livelihoods. In richer countries
most peoples livelihoods have been ensured by wage-paying jobs, although tens of
millions have lost these jobs since 2008. In most poorer nations a much higher
percentage of people meet their daily needs by growing their own food or catching their
own fish or working outside the formal sector. While it is difficult to measure the extent
to which such a countrys population has secure livelihoods, it is a vital aspect of
rootedness. The existence of such programmes is an important measure of social
rootedness.
b. Equality - The rising inequality of income and wealth in most nations is in good part a
consequence of neoliberal policies and presents a pressing moral issue. According to
the UNDP and researchers Richard Wilkinson and Kate Pickett, "more equal societies
have higher indicators of well-being across the board". Hence, equality is an important
social rootedness indicator, and good data exist for measuring income inequality
(including along gender and racial lines) and wealth inequality.
c. Human rights - Since the United Nations adopted the Universal Declaration of
Human Rights in 1948 there has been an internationally recognised framework for
measuring human rights. The rights are relatively measured, and when countries score
high in these rights, human and environmental well-being are usually higher than in
countries that score low.
d. Power/control
Peoples sense of well-being tied to how much control they have over their natural
resources and over their lives in economic, social and political terms. For example,
people have more control if they are in worker-owned or co-operatively managed
workplaces. As in the case of Trinidad and Tobago, organic farmers growing for
themselves and local markets tend to have lower costs and more control over their
decisions and destinies.
Conclusion
New approaches to development can break new ground in addressing vulnerabilities.
Furthermore, there are variety of ways wherein government can pursue its policies to
lessen vulnerabilities and encourage rootedness.