Dossier:

29/07/14

European Development Agenda Puts Commercial Interests before Health

In developing countries Europe prioritises the privatisation of services, even if this agenda enhances inequalities in access to health care. Europe promotes minimal or no binding regulation for multinationals, which can have harmful consequences on health and the environment. Instead of directing its policy towards commercial interests, the European development cooperation should prioritise health.

 

Europe promotes privatisations in developing countries

The EC Development Cooperation’s ‘Agenda for Change’ describes that ‘public actors should conclude partnerships with private companies, local communities and civil society’. The European Commission wants to create a favourable business environment in developing countries and ‘catalyse private investments’. In a recent press release Andris Piebalgs, European Commissioner of Development Cooperation, confirmed that the Commission aims to foster partnerships with companies in order to ‘provide basic services, such as energy, water, health care and education’. The Commission is of the opinion that ‘the European Union should only invest in infrastructure when the private sector is not able to do so on a commercial basis’.

However, the objective of commercial companies is not to serve the common good. The defining characteristic of a company is that it should make profit for its shareholders, whose goal is to see their investments grow. Marijn Dekkers, CEO of the pharmaceutical company Bayer, said with regard to the cancer drug Nexavar: ‘Let’s be honest, we did not develop this product for the [poor] Indian market, but for Western people that can afford it’. In the Philippines, social movements are protesting against the outsourcing of health care to the commercial sector, as it endangers the poor, denying them the access to essential medical assistance.  

 

EU promotes minimal or no regulations for corporations

The European Commission encourages ‘Corporate Social Responsibility’. She asks corporations to voluntarily behave themselves in a responsible and ethical manner, which equals minimal or no binding regulations to hold corporations accountable. Some companies may indeed have supplementary objectives, e.g. ecological, but they are secondary to the profit margins.

Nevertheless, there exist numerous examples that show the negative consequences of the activities of insufficiently controlled multinationals on health and environment. Transnational companies like Chevron will in turn use charity as a pr campaign. Chevron aimed to improve their image, after they had lost a case filed against them with respect to the contamination of the rain forest and the destruction of the indigenous inhabitants’ lives.

 

Why, then, does Europe promote a privatisation agenda?

The European policy is interwoven with the interests of powerful companies. After all, multinational and transnational companies have accumulated an enormous economic power. Over a period of 30 years, the number of transnational companies increased from 7.000 to 53.600 in 1998. Mergers and acquisitions have further extended their power. 200 multinationals together own more than 182 states that cover 80% of the world population. In 2009, the pharmaceutical industry alone held 752 billion dollars, which is more than the gross domestic product of some countries. Today, the 500 largest multinationals own 70% of the international trade. 

Disposing of all the necessary resources, transnational companies have been able to accumulate a considerable amount of political power. Powerful companies influence public regulation through all available channels. They exercise their influence on policy processes in order to defend their business interests on a local, national and supranational level. For example, the lobbying of, among others, the Gates Foundation and the Buffet Foundation (two befriended business tycoons) have led to the inclusion of the Misoprostol drug on the essential drug list of the WHO, even if this drug has been proved not to be the best drug against postnatal haemorrhages. The European Commission also, is influenced by this corporate power. The expert groups that assist the EC in the process of making new bills mainly consist of company representatives. European commissioners and members of the European Parliament have been known to start a lobbying career in the commercial industry after their political career, or vice versa. Companies are capable of recruiting the best minds that conduct scientific research for them supporting their objectives, e.g. the networks of corrupted scientists that undermined scientific evidence regarding the consequences of tobacco consumption or the global warming.  

 

So, what should Europe do?

The European development policy puts commercial interests first, but should instead prioritise public health. After all, health is a fundamental human right. Economic development should be no more than a tool to help achieve human development. We cannot expect that companies voluntarily behave in a responsible manner, let alone in public services that should provide for the population’s basic needs. Instead of promoting the privatisation of public services, the European Development Cooperation should foster the development of comprehensive primary health care in developing countries. Furthermore, Europe should support binding rules for multinationals on an international level.

Photo: Corporate Europe Observatory

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