ORIGINAL FRENCH ARTICLE: La faim profite (encore) aux banques
by Marion d’Allard
Translated Tuesday 3 March 2015, by
Two years after the first report, the NGO Oxfam France reveal that financial institutions continue to speculate on agricultural commodities.
Launching, in 2013, a campaign against speculation on agricultural commodities by French banks, the NGO Oxfam France threw a spanner in the works of this murky banking practice. Caught out by Oxfam’s revelations, mammoths Crédit agricole, BNP Paribas, Société générale and the BPCE group engaged in – or not – significant reduction in the amount of funds speculated on this market. Two years later, where are we? That is the question answered by the NGO in a report published today. And the conclusion is unquestionable: famine continues to sharpen the appetites of the big French banks. In 2013, Oxfam calculated that the total value of funds from the four big banks suspected of speculating in agricultural commodities was 2,583 million Euros. After the banks committing to reducing these figures, these same funds now account to... 3,561 million euros! Oxfam explained how only Crédit agricole respected its commitment and no longer holds any of this type of funds. BNP Paribas and Société générale speculate as much as ever and the BPCE group, who did not have the audacity to engage in the market in 2013, pushed up the total of these agricultural funds 43% in two years. A list of figures and banking packages which may seem a little technical, even obscure. Except that speculation on agricultural commodities is not anodyne. “These activities aggravate the volatility of prices and make access to basic foodstuffs more and more difficult for the world’s poorest people” state Oxfam. And if the UN estimates that 800 million people suffer famine across the world – one person in nine – food production on a world scale is amply sufficient satisfy us all.
An increase attaining 181% in three years for wheat.
The core of the scandal lies between the producer and the consumer, in the vast grey area of finance. “The agricultural markets are financed by speculation”, underline Oxfam, who specify that, “combined with the increase in agrofuels, the the political abandonment of stock-piling, the effects of climatic change and the lack of structural investment in agricultural farmers, (that) excessive speculation (…) forces millions of people into abject poverty, and augments food insecurity worldwide”. So, from February 2005 to February 2008 (the year of an unprecedented food crisis), world food prices increased by 83%, and hitting 181% for wheat! A hike in prices which “most severely affected the poorest households in the the southern hemisphere, who dedicate up to 75% of their budget to food, whereas households in developed countries, dedicate, on average 10 to 20% of their income”, explain Oxfam. In the infernal spiral of hunger, the responsibility of the banking sector is overwhelming. That of politicians too. In its report, the UN recalls that in 2012, presidential candidate Hollande committed to “putting an end to toxic financial products which make the speculators rich and menaces the economy”. Broken promise.