- by Razvan Prejbeanu
- Posted in Internationalization
- March 1, 2016
- 1538 views
The Eurozone’s crisis has not only monetary implications. It has also webmarketing paradigmatic shift because consummers and farmers try to bypass mass distribution in order to survive with a fair price. Lets have a look at the booing of François Hollande and his Prime Minister and how it drives a demand for farmers to sell directly to the final customers using e-commerce platforms, in the perspective of the upcoming Transatlantic Partnership.
We assume that this clash between the symbol of power (French State) and the farmers is just the top of the iceberg of a paradigmatic shift that scratch the surface regarding the among small entrepreneur’s hated TTIP (Transatlantic Trade and Investment Partnership). As a reminder, the TTIP wants the fusion of the EU and USA in a supranational superstate where some mega banks will be above the law and – very bitter cherry on the cake – above the government. It means that if the fairy tales healty food company Monsanto (sic(k)) wants to flood the market of the EU country X with its GMO, and that country X refuse, then the TTIP will give the power to Monsanto to sue the country X in front of a supranational court. In that sense the grassroots food producers will be destroyed, if Monsanto’s like companies lead the European food market.
The massacre of farmers
Each day in France 50 farms go bankrupt. Even the Minister Stéphane Le Foll said this summer that “between 22’000 to 25’000 farms will be close to bankrupcty this summer”.1 This will of course affect processed grassroots, organic and regional food, some of these companies being ones of the flagship of regiconia.com products.
As illustrated by the angry farmers at the agricultural fair these days, annual show-off of French presidents when their popularity rate dive deep, the sector is in deep trouble. Hollande then Manuel Valls (the Prime Minister) were booed by the farmers, willing the send the message that they are dying because of the small price payed by the mass distribution. In addition the mass distribution is caught between a rock and a hard place because they have to buy extra-european products. So, French products can not be competitive with extra-european or Eastern European products. Furthermore, the ultraliberal opening to cheaper agricultural products has on the one hand helped the middle-class to buy more for less but destroyed French (and tomorrow Swiss) farmers. However, according to a fresh poll, French customers by about 2/3 would agree to pay more in order to save their farmers.
It is very hypocritical that the EU has not strenghtened itself beside protectionist barriers, contrary to all the big macroeconomic players (Japan, USA, China). Has it been on purpose? If the deepening of the TTIP will be a reality we can bet it was on purpose, Whasington dictating the economic rules in favour of its corporations but to the detriment of EU and Swiss companies (remember the US war against “Swiss tax havens” favouring US tax havens like Delaware). It may be possible that the tool TTIP will be led by the USA at the detriment of Europe and it that sense of the latter’s companies. If the TTIP succeed small grassroots farmers will have no survival chance.
Threats of the Transatlantic partnership
With the eagerness with which the EU is pushing for this partnership since the beginning of the year, things are so rapidly accelerating that Swiss companies should be aware that this partnership will come sooner than expected. Too many signs show that this partnership will not only be a free-trade area, but more probably a supra-national deepened integration that will merge the EU into a bloc dominated by the USA.
Because at regiconia.com we are deeply concerned by grassroots food it is important for Swiss managers to know the answers of the following questions (put on the EC TTIP official page): “Will European supermarkets be filled with meat from American animals fed with hormones”?; “Are the negotiations being held in secret?” and “What will happen with agriculture?” The answers sounds good at first sight for small premium producers – the targeted customers of Regiconia – because Transatlantic partnership can increase their sales as quoted here below, but is it only EC propanganda? The future will tell us. The European Commission answer to the latter question is that on the one hand the TTIP will favour US producers of maize and soy and the other hand favour EU exporters of “higher value food products like spirits, wine, beer, and processed food (such as cheeses, ham and chocolate).” Especially since“[a]t the moment, some European food products, such as apples and various cheeses, are banned from the US market” or subject to high US tariffs”. The TTIP will remove these tariffs.2
We will not speculate, but ask SMEs to carefully take into account that the European Commission has too often promoted big business at the expense of small SMEs.
But everything is not dark for French and Swiss grassroot foods companies. That because the TTIP will not bring only threats to small producers but also opportunities. For example, for some European small and middle size companies, the TTIP can represent a favourable position for them, because among other things this treaty increases these companies’ market opportunities. As we know the Swissness symbolic value has high ranking upon the Atlantic ocean. Therefore the TTIP can increase Swiss SMEs’ market share, geographic markets (decrease of export papers’ bureaucracy) and in fine sales.
Mayors, public opinion and small SMEs united against GMOs and junk agriculture
In France, some villages are labelled “TTIP free area”. A lot of French mayors have put an emphasis to reject this treaty because they care of grassroots food and their farmers.
If the public pressure blocks the TTIP all across Europe, the impact for Swiss SMEs can be excellent. A better redistribution of the wealth is operated, the taxes on SMEs and private individuals are decreased. The nearshoring (like General Electric taking back is offshore China’s factories) and the European protectionism allows to keep jobs in Switzerland and in the EU thus the unemployment falls, the purchasing power of households increases on both sides of the border (remember that the Geneva Canton has a huge unemployment rate) and the Swiss SMEs see their customers increase. Of course, the picture seems too idyllic and we are not going to go into the debates which bring into conflict partisans of the austerity and their opponents. But it is a fact, if we consider that the balance sheet of Deutsche Bank and BNP Paribas exceed the world GDP while at the same time BNP limits the withdrawals of French people, it is not utopian to conclude that money exists to finance SMEs but that there lacks only political pressure on those banks to lend again to small SMEs.