Monday, December 2, 2013

Wendy Bacon on the Graincorp decision : A small victory over corporate power?

The decision by the Abbott Government to block the sale of  the Australian Graincorp** to  Archer Daniels Midland (ADM), the multinational agribusiness conglomerate, is an important short term victory in the struggle against global corporate power in this country.

Short term because the sale is only delayed and ADM is able to increase their ownership of Graincorp over time, putting them in a stronger position to come back with a larger offer at  later date.

But despite the longer term uncertainty over the future of Graincorp, the importance of this victory must be recognised. 

As Wendy Bacon, Professor of Journalism at the Centre for Independent Journalism writes in New Matilda in this superb piece of investigative journalism, the Government's decision to block the sale was the result of a complex set of political alliances and forces that coalesced around ADM's long record of questionable corporate and financial practices.

Although the decision was portrayed in the mainstream media as the Abbott Government caving in to pressure from their National Party coalition partners, Bacon demonstrates that the decision was the result of serious public concern about ADM's record of corruption and tax minimization, its involvement in a series of court cases over unlawful and unethical practices, and concern that ADM would use its market power to the detriment of Australian growers and Australians more generally.

** Graincorp has a near monopoly of Australia's grain exports, as well as major controlling interests in the supply of seeds, oils and malt in Australia. The sale of Graincorp to ADM was widely opposed in Australia by farmers groups, the National Party and the Greens, as well as a whole range of agricultural and campaigning groups. But the sale was actively supported by Graincorp itself, the ALP Opposition Party, lobbying firms acting for ADM, various financial and corporate interests, and a whole swathe of financial and investment companies who were saw the opportunity to make a fortune out of the sale.

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