Life Science/Biotech Corporations Prepare for Global Dominance

THE
AGRIBUSINESS
EXAMINER
December 8, 2003, Issue #310
Monitoring Corporate Agribusiness
>From a Public Interest Perspective

EDITOR\PUBLISHER; A.V. Krebs
E-MAIL: avkrebs@earthlink.net
WEB SITE: http://www.ea1.com/CARP/
TO RECEIVE: Send name and address

ETC. GROUP STUDY:
CORPORATE AGRIBUSINESS OLIGOPOLY
OVERWHEMING GOVERNMENTS AND
SUBVERTING NATIONAL SOVEREIGNTY

Formerly known as the Rural Advancement Fund International (RAFI), the ETC
Group has released a new report on concentration in corporate power. The
18-page report entitled, "Oligopoly, Inc.," documents eye-popping trends in
corporate consolidation in the life sciences industry. The full report is
available at:
http://www.etcgroup.org

For the past 20 years [ETC] has monitored corporate concentration in
commercial farming, food and health. This year, ETC Group's report also
includes the emerging field of nanotechnology. Nanotechnology refers to the
manipulation of matter at the level of atoms and molecules, the building
blocks of the entire natural world.

According to ETC Group's report, transnational firms are overwhelming
governments and subverting national sovereignty. Based on 2002 statistics,
over half of the world's 100 largest economic entities are transnational
corporations, not nations. Wal-Mart is bigger than Sweden; Home Depot (a
hardware and building supply retailer) is a bigger economic entity than New
Zealand. When governments serve corporate interests rather than the
interests of citizens, democracy is undermined, diversity is destroyed and
human rights are jeopardized. "Oligopoly, Inc." examines the following
sectors in more detail:

* PHARMA: The top ten companies control an estimated 53% market share of the
world's leading 118 drug firms.
* BIOTECH & GENOMICS: The top ten firms account for 54% of the biotech
sectors' $42,000 million ($42 billion) revenues.
* ANIMAL PHARMA: The top ten companies control 62% of the $13,400 million
world market.
* SEEDS: The top ten companies control one-third of the $23,300 million
commercial seed market.
* PESTICIDES: The top ten firms control 80% of the $27,800 million global
pesticide market.
* FOOD RETAIL: The top ten mega-grocers control 57% of the total sales of
the world's leading 30 food retailers.
* NANOTECH: Public & private sector investment in nanotechnology is an
estimated $5,000-$6,000 million per annum.

Corporate consolidation and converging technologies are driving economic,
social and political issues that range far beyond the borders of any single
country. In addition to campaigns waged by civil society and peoples'
movements at the local and national levels, reform of corporate governance
will require that the United Nations gain the capacity to monitor and
regulate corporate governance. Beyond governance, the international
community must create the capacity to track, evaluate and accept or reject
new technologies and their products through an International Convention on
the Evaluation of New Technologies (ICENT).

In the past the ETC Group has monitored trends in corporate power and the
so-called life sciences industry. In its earlier reports it noted that it is
increasingly difficult to distinguish between industry sectors. Today, the
boundaries between seeds and agrochemicals, pharmaceuticals, genomics and
biotech continue to blur.

After decades of mergers and acquisitions, extraordinarily powerful
corporations are using new tools to expand geographically and to reinforce
oligopolistic control of markets. In a world where a handful of global
technopolies dominate, patents
become less relevant because other tools of monopoly are cheaper and more
far-reaching.

Some corporations are eschewing the merger and acquisition strategy in favor
of alliances and "nonmerger mergers." As one industry analyst notes:
"Cooperation is becoming as common as competition among the industry's
leading corporations." In other words, it can be far more profitable for
companies to cross-license technologies and bury the patent-litigation
hatchet in order to create "global technology cartels" that
operate below the radar screen of anti-trust regulators.

Today we are witnessing not only corporate convergence, but also
technological convergence. In the 1990s, for example, the Gene Giants
combined molecular biology and information technologies to create a new
platform for developing drugs,
agrochemicals, plant breeding, food and more based on genomics research.
Today, within the field of nanotechnology, the quest to integrate science
and technology is taking a giant step down --- from genomes to atoms.

Whereas biotechnology gave us the tools to break the species barrier (to
transfer DNA to and from unrelated organisms), nanotechnology enables
scientists to shatter the barrier between living and non-living. At the
nanoscale the same atoms can be rearranged to construct a gene (the basic
unit of genetic code) or to construct a bit (the basic unit of digital
information) or to construct a neuron (the basic unit of brain
function).

Because of this "material unity at the nano-scale," the investment in
nanotech R&D is not limited to life industry players and nanotech is
attracting more public funding than any single area of technology. Nanotech
blurs the boundaries between all industry sectors.

The world's largest companies --- from military, mining and manufacturing to
energy and electronics, to food processing and chemicals are all major
players. Today, transnational corporations often have revenues far exceeding
the total GDP of the
countries where they do business. Fifty-one of the world's 100 largest
economic entities are transnational corporations. Of the world's 50 largest
economies, 14 are corporations (28%).

In addition to Wal-Mart and Home depot's domination of the oil-rich
countries in the Middle East, only Saudi Arabia and Iran made it into the
top 100, but six oil companies
appear on the list.

Combined sales of the world's 200 largest corporations accounted for 29% of
world economic activity in 2002, but the top 200 corporations provide only a
tiny fraction of the world's jobs. In 2002, the top 200 multinational firms
employed less than one percent (0.9%) of the world's workforce.

Combined sales of the world's top 500 corporations in 2002 were equivalent
to 43% of the world's GDP.8 These companies collectively employed only 1.6%
of the world's workforce.

Trends in corporate concentration are mirrored by growing disparities
between rich and poor, both within and between OECD nations and the South.
Though not an adequate measure of poverty, more than 1.2 billion people ---
one in every five on
Earth --- survive on less than $1 a day.

Overseas Development Assistance (foreign aid to poor nations) totals
approximately $50,000 million per year worldwide. By contrast, global
military expenditures in 2002 were estimated to be at least $700,000
million.

OECD countries provide more than $300,000 million in agricultural subsidies
each year. Subsidies to the U.S. cotton industry equal more than triple the
amount of U.S. government aid to sub-Saharan Africa.

At the end of 2002, the number of jobless people in the formal sector
worldwide reached a record high of 180 million, and the situation is
"deteriorating dramatically," warned Juan Somavia, the Director-General of
the International Labour Organization. The ILO's unemployment statistics do
not include the informal sector and the "working
poor" who live on $1 or less a day (again, a less than perfect measurement
of poverty).