In this edition of the Supermarkets Watch Asia Bulletin, we look at the expansion of multinational food companies and retailers from a widened point-of-view. These companies are adopting new strategies to expand their presence in Asia and across the globe. The editorial of this number of the Bulletin focuses on the aggressive actions of multinational supermarket chains in Africa. Their impact on local food systems has given birth to a new struggle across the African continent, led by small farmers, small vendors and consumers.
Supermarket Watch Asia Bulletin
Supermarket watch Asia is a quarterly email bulletin for social movements about developments in food retail and distribution in Asia produced by GRAIN.
In Thailand, the development of modern retail puts consumers and farmers at a loss. According to BioThai, 75 percent of the price of a banana sold in a modern retail outlet goes to the retailer and its suppliers, while only 25 percent goes to the farmer. Moreover, the price of a banana in Thailand is almost the same as the price of one sold in Europe, where 80 percent of the price goes to the retailers and towards import taxes.
Electronic commerce is expanding rapidly into food distribution and retail across Asia. In particular, the emergence of online food delivery services is generating significant changes to farm-to-fork food supply chains. Yet very few countries have regulations covering online food distribution, including food safety and health hazards, or even regulations covering cross-border e-commerce for food. Some of the world's largest e-commerce and retail companies are moving aggressively to take control of and expand online food retail, with major implications for local food systems, small vendors and farmers.
It has been two years since we first published this quarterly information bulletin about developments in the food retail and distribution sector in Asia. A few months ago, we thought it was time to assess whether the bulletin served its purpose and how it could improve. So we decided to run a survey and dedicate this issue to sharing some of its results.
According to different sources, transnational supply chains currently account for 30 to 60 per cent of all global trade, and depend on the work of over 100 million workers globally. On average, companies relying on transnational supply chains only directly hire 6 per cent of the labour force they actually employ. The rest is “outsourced”, often scattered across several countries and amongst thousands of suppliers.
In June 2017, Amazon, the world’s third largest e-commerce company, announced its acquisition over Whole Foods Market for US$ 13.7 billion. Amazon’s move seems to follow the footsteps of Alibaba, the world’s largest e-commerce company that invested US$ 1.25 billion in buying the Chinese online food delivery service Ele.me in late 2015.
Concerns about food safety and hygiene have underpinned some governments’ decision to ban street vendors and close down fresh markets in recent years. Bangkok’s street vendors are the latest victims of this ban as the city government announced it will clean out all street vendors by the end of 2017.
Fresh markets sustain the economies and livelihoods of millions of people. Despite this reality, the governments of many Asian countries are systematically adopting policies that undermine local markets and the people who rely on them. From Hong Kong to Hanoi, governments are banning fresh markets or scaling back market interventions that once kept corporations and price volatility in check. In Indonesia, for instance, the government lifted commodity price regulations, eroding the food security of farmers, small traders and poor consumers.
In 2014, the Committee on World Food Security (CFS) established a special work area or “work-stream” on Connecting Smallholders to Markets with the aim of exploring the relationships between markets, food security and smallholder agriculture. Organisations of small-scale food producers in the CFS’s Civil Society Mechanism (CSM) decided to participate in this work-stream because it offered an opportunity to recognise the contributions of small-scale food producers to global food security and nutrition.
This issue of Supermarket watch Asia bulletin highlights the impacts of trade and investment agreements on farmers, fishers and street vendors. We begin with a statement from the international peasant movement La Vía Campesina on trade, markets and development, which was issued during the Fourteenth Session of the United Nations Conference on Trade and Development (UNCTAD), 17 – 22 July 2016 in Nairobi, Kenya. We then look at how Hanoi, Vietnam has criminalised street vendors who are already threatened by the expansion of foreign retailers caused by new trade regulations. Finally, we examine the experience of a food safety organisation in Thailand that is suing the Thai government over its failure to protect food safety with regards to fruits and vegetables sold in supermarkets.