Food speculation rules face delay
16 November 2015
The financial press was buzzing last week with reports that the high profile EU legislation to tackle the financial crisis of 2007-8 is at risk of being delayed. This legislation was passed at the beginning of 2014 and thanks to public campaigning here in the UK and across Europe, includes provisions to tackle reckless betting on food prices.
Rocketing food prices during the global food crisis left millions hungry and food riots swept through major cities across the world. A key driver behind the surge in food prices was excessive speculation in the financial markets. As millions went hungry, banks raked in the profits.
And so it’s no surprise that the corporations and the financial sector have been actively lobbying to reduce the impact of the legislation. For almost two years, since the legislation was agreed, the detail of implementation has been a work-in-progress, giving plenty of time for corporate lobbyists to exert their influence to water down and now delay the legislation.
If the delay is confirmed, it will be a classic case of corporate interest trumping the interests of ordinary citizens. The financial sector and Europe’s financial regulator say they need more time to build the new systems required to support the regulations but other critical financial experts do not agree and believe the systems will be ready in time. The financial sector have known about this impending regulation for a few years and have had plenty of time to introduce the required infrastructure.
The proposed one-year delay would mean that the legislation would only start to apply in January 2018 which by then would be a good 10 years from the financial crisis of 2008.
The stakes are high – the financial sector are keen to protect their ability to profit from excessive speculation while ordinary citizens are fighting for their right to not have their food prices subject to the casino instincts of corporations.