blamed for rise in global commodity prices
IANS, April 30,
Cartelisation is leading to
volatility in global commodity markets and keeping
the prices high, causing damage to countries like
India which is heavily dependent on imports to
meet energy requirements, a report said.
A joint publication by NGO
CUTS International and Centre for Economic Policy
Research titled "Trade, competition and pricing of
commodities" suggested that there was need for
effective cooperation among countries to curb the
menace of cartelisation.
"Cartels are both
exclusionary and exploitative," said Hassan Qaqaya,
head, competition and consumer policies branch,
United Nations Conference on Trade and Development
(Unctad) after releasing the report.
The report was released on
the occasion of the 13th Unctad meet in Doha last
Qaqaya said there was need
to improve cross-border cooperation and
intelligence-sharing among national competition
agencies. "In this regard, lessons can be drawn
from the experience of consumer protection regimes
in the world where cross border cooperation is
quite advanced and effective."
Secretary general of
Consumer Unity and Trust Society International
Pradeep S. Mehta suggested the need for creating
an "international competition fund" out of cartel
fines imposed by rich countries.
"Countries adopt a
beggar-thy-neighbour policy and thus allow export
cartels to operate freely," said Mehta.
"This is one area where
capacity building is required urgently for
developing countries to be able to deal with such
cartels through extra territorial jurisdiction.
They also need resources and effective cooperation
from the rich countries, because just the law will
not help them to deal with them," he said.
The report pointed out that many developing
countries were heavily dependent on primary
commodities but received only a small part of the
total value chain.
On the other hand, a small number of international
traders and retailers controlled the large
segments of the value chain in the commodities
like coffee, fertilisers and potash. "The
situation is exacerbated as many countries
including the USA do not prohibit export cartels."
Mehta suggested five multilateral solutions to
address the current lack of adequate governance of
These are: strict World Trade Organization (WTO)
disciplines on export restrictions; other possible
WTO remedies against injury caused by export
cartels - like reverse anti-dumping; formation of
countervailing buyer alliances; a multilateral
agreement on trade and competition and creation of
an international competition authority.
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