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Posted on Sustainabilitank.info on February 20th, 2014
by Pincas Jawetz (pj@sustainabilitank.info)

Actually – the title of the speech at the lunch organized yesterday by the Brazilian, Colombian, Ecuadorean Peruvian and Venezuelan – American Associations or Chambers of Commerce “- with Dr. Ocampo – was: “IS THE COMMODITY BOOM IN LATIN AMERICA ENDING?

The speaker who is now professor at Columbia University is very well known to us since his having been Finance Minister in Colombia, an official at the World Bank and the UN and member of many studies and panels – in effect searching our own website one finds many references to him.

Traditionally, Latin America is an exporter of Natural Resources we call Commodities because we used to say they are fungible – if the producer wants to increase price we will go to someone else who makes the same product – so exchanges just dealt with the bulk in many cases even not specializing – that is except for just a few items like sugar, coffee, cocoa, but forget wood, minerals, oil, coal – these were just means of getting the resources of the South to an industrialized North at fire-sale prices.  In the exporting countries  a few in the government circle got rich – and the many got meager salaries provided they played the game. Country economies were measured in GDP terms without any attention to who gets that income and why.

We know that the World economy had a slow down – but commodity purists say that 2004 – 2007 was the best time for commodity exports in the last three decades. Now they look at the possibility  that World Growth Prospects are slowing by much and this is not just in the movement of goods.

In effect Dr. Ocampo enlarged the subject also to Migrant flows and Remittances, and access to International Financial markets – that were best since the second half of the 1970s.

What has happened since 2011 is that growth has slowed by 30% despite a strong business cycle – not any different then in the US itself I must add – and this must be an eye opener to all those young unemployed that prepared themselves for a life on the boom. Dr. Ocampo found within the commodity business boom also a South-North regional pattern that will harm poverty reduction efforts – and he reaches the conclusion that due to the weakening of the World Trade, the space for orthodox export-led policies may be over, he said. On the other hand, a pure inwards-looking strategy would work only for very few countries – perhaps Brazil – he said.

So, he advises an aggressive export diversification strategy;
A reorientation towards Asia – that means China – but this works only with diversification;
A sponsored expansion of the domestic markets.

When it came to the Q&A – a question that seemed to me out of place was about entrepreneurs and small business. This is indeed very important for the social structure of the country, and for the economy at large – but does not touch the Commodity issue because that issue was always in BIG Hands.

I tendered a different question which I predicated by saying that I am trying to deconstruct the concept of Commodities – a concept that in my eyes never had standing in the economy.

I mentioned that some of the commodities are non-renewable and when exhausted leave only problems behind and an impoverished Nation. Within this group there are technology induced changes – like the foreseeable demise of the Copper market and a new demand for Lithium .

But then there are Commodities based on Renewable Resources that do not harm the future of the State. But even here there are effects from the outside – this like the demise of Leopard Skins or Ivory and Rhinoceros Tusks from lists of Commodities.

So, my actual question is if time has not arrived to look at each exported good separately rather then bunching them into the term of Commodities where the exporters of bananas once thought they could build up a power equal to that of OPEC.
After the talk  – I found that quite a few people were ready to give a second thought to these comments.o
I took then the 50 Street Crosstown bus to get to the UN where a group that claims solidarity with the Palestinians was hosting Mr. Emad  Burnat from the village of Bil’in – a farmer and self-styled cameraman whose documentary “5 Broken Camera”  is being promoted by activist Oscar-winning filmmaker Michael Moore.

Emad Burnat started filming in 2005 daily life in his village, and clearly had the talent to bring out the abnormal life under a foreign occupation  – that is if you consider living in the Colorado State of the Columbine shootings as normal, or life in any village in an Arab State normal.

I knew what to expect, but wanted to see how the UN sells the commodity of “Hate Israel” – because really – the hand clapping had nothing to do with trying to alleviate suffering of the Palestinians, but rather I saw there various people – some claiming Jewishness for unclear reason – and heaping it on Israel. There were so called Press or Media people that have never written a word about climate change,  and there was an Arab who lived in Brazil and loves to speak Portuguese and Spanish for his outreach.

I asked Mr. Burnat if he spoke ever with Uri Avnery – the Israeli maverick who was the one to bring to the public’s eye the problems the villagers of Bil’in were having, and who tried to help?  After all the film-maker’s statement was that it is his intent to help the villagers and himself? I said that talking with people like Avnery can help him on the ground – and what can the people in this room at the UN actually do on the ground?

As I did not get an answer to my very direct public question – just a few grunts and something that a TV reporter meant as an insult – “Zionist” I spoke to Emad after the presentation in private and then I heard from him that it is not about the village but larger, about Palestine. OK – so be it – the commodity at sale here is simple hatred – nothing else, but the problem is real and involves real people – and this is not his issue. I also said to him that in Israel people do not want to revisit the Holocaust and I would expect from him to not like the killing of the Syrian Arabs by Arabs – it does not make sense to score points over dead bodies.

I must also note that the UN DPI that posts a list of UN activities for the information of the media – had the “5 Broken Cameras” information, but then never has other topics of general interest – like the presentation today by Ms. Angela Kane – The UN Representative for Disarmament Affairs who spoke on her experiences as head of the UN spearhead on the issue of Chemical Weapons in Syria. She was very diplomatic and made sure she says only things she can prove. The Syrian Ambassador could not have had reason to doubt her impartiality.  She did her work out of her Vienna based headquarters and gave support to the UN Security Council – in case the UN wants to come up with decisions – but the question is will they?  For journalists the question is what is actually going on – and this presentation could have helped them – but the UN Department of Public Information keeps the Information commodity very close to the Arab side – whatever that might be the case.

OK, I am sure that I might have over extended the use of the term Commodities – but I do believe that there is indeed much more to this word if we try an ounce of real Aqua Vita. Individual Nations are suffering when the value of commodities is in decline – our job ought to be to explain why this happens – and the suffering – not of Governments but of their subjects.

 

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