Don't get me wrong, MNCs do a lot that help host countries. They build invaluable infrastructure (bridges, roads, airports) and do provide employment to an otherwise destitute population. NOT ALL MNCs are bad. Many have strict policies on labour, wage rates and the like. MNCs bring in investment and foreign currency - usually stronger than the local currency, lead to the growth of new industries and some provide education and training in new skills for the local population. BUT. There is a massive but.
If a firm wants to achieve maximum profits, if that is its main motive, its main aim, it will probably do just about anything it can to achieve it. It will probably try to stay within the bounds set by the authorities and the law, but sometimes may feel the necessity to overstep that boundary just a tad in order to scrape up just a few extra billions.
So they want to make big profit. Let's take the example of a manufacturing firm. They need to lower their costs in order to achieve as much producer surplus as is possible. How to achieve producer surplus. Well first we'll need to employ a mass of labour so we can make a ton of output. Ah, problem, we'll have to pay those workers. So we need a way of keeping a lot of workers at low wage rates. We can't do that in our own country (let's say the UK or US) because of the gosh darn Minimum Wage and all those snotty workers' rights regulations... so let's move to somewhere desperate. Somewhere cheap. How about Guatemala? Sierra Leone?
So they pack up and move across the world.
Once they find a sufficient location in which to exploit low wage rates, they set up camp. Thousands upon thousands of employees flock the factories labouring for hours for a few pence. In one Nike factory it was reported that they were working for as little as $2 a day. Nike admitted to the allegations about child labour but stated that it would be hard to change policy. Pause a moment to take that in.
There have been many accusations of sexual harassments of female employees in Nike factories in Vietnam and some muslim workers stated they were kicked whilst praying by the regulators. Forgive me, I don't have the statistics for this information it's all in my geography folder and when I have time I will put them up. The evidence is all over the place, look it up and decide for yourself. Anyway I digress again.
As soon as wage rates get too high or the companies are forced to raise them, they pack up and move somewhere else - cheaper.
Chocolate. That milky, creamy treat we all indulge in. Some people call it the innocent sin. When they say this they're implying when you eat it you'll gain a few pounds. Let me enlighten you on the true sins that come wrapped in that packet of dreamy delight.
The Ivory Coast and Ghana are the world's largest cocoa producers. Around 100,000 children work in chocolate factories in the Ivory Coast, it is estimated that about 10,000 of those little children are slaves.
Here's a shocker, Cadbury Schweppes, Nestle and other major chocolate brands have stated that they cannot confirm whether the chocolate they sell has slave blood on it or not. Scary huh? Well, frankly, I think it's ridiculous. The massive MNCs that generate insurmountable amounts of profit can't even pin point who produces their cocoa? I'm sensing something very fishy here...
The Ivory coast produces 43% of cocoa around the world, so chances are we've all indulged in a bit of tainted chocolate.
Something has been done. The US congress passed a legislation that agreed to end forced and abusive child labour by 2005. The International Labour Rights Fund has stated since that little has been done.
The kids that work in these factories are constantly exposed to poisonous pesticides used on the cocoa beans, they work long hours in blazing heat, walk miles to transport their produce and face regular abuse from their 'employers'. We are talking about children here. I'm not saying that it is excusable to treat adults this way, but just think. Little children, some below the age of 10, beaten, whipped, hungry, innocent children. What hope do they have if those who have the ability to help draw them out of the poverty trap are pushing them further and further into it. They have no chance of an education, a ticket out of the degradation. By constantly consuming tainted cocoa for our own enjoyment we may be funding the most unethical, evil system on earth.
It is not easy to solve this problem. An Association Spokesperson for the chocolate companies in question, Mr. David Greenwood said ''Boycotts will not help anybody. Hand-outs to people without change will achieve nothing''. He is mostly right in my opinion. Yes it raises awareness and yes that may spark the light in a few peoples' hearts and they may opt for fair trade products (though who's to say how 'fair' these products are). However it is up to us. We can know everything about this and choose to ignore it. If you don't acknowledge it, does it exist? That's the attitude I fear a lot of people take. It is easier to ignore it, there's no doubt about that, it doesn't affect us right? Look into your hearts, see into the love you have for your children, for anyone, for yourself, would you want or let anyone go through this if you had the ability to contribute to ending it?
How do we know what is tainted and what is not? Chances are almost everything we buy has been passed through the hands of an ill-paid exploited worker at some point. Where do we draw the line? I don't know the answer, I'm still trying to figure it out. For now all I can say is that it's a choice between that shirt for £5 with no guarantee of fair trade or the one for £10 with the red label on it. Think about it.
Next post on more aspects of globalisation
If you want information or any bibliography for the above facts and figures, please let me know I'll be more than happy to assist you
Some useful links