Between free trade and local markets: Thailand's attempt to enter CPTPP negotiations meets opposition again

In April 2020, Thailand's military dictatorship made another effort to join the Trans-Pacific free trade agreement, CPTPP, even as the country was in the midst of the Covid-19 pandemic. But, once again, opposition from the people’s networks, civil society and farmers networks were able to stop it.

FTA Watch joined other civil society organisations, farmers' organisations, and the general public in a mass protest that forced the government to delay the process for joining the CPTPP negotiations and to set up a subcommittee to consider the impacts prior to moving forward. Up until now, the Thai government has not been able to formally submit its intention to join the negotiations.

The CPTPP would oblige Thailand to liberalise markets for agricultural commodities by eliminating all tariffs on over 95-99% of its agricultural commodities. This will have widespread impacts on Thai farmers, whether they are in livestock, field crops, vegetables or fruits, as well as people's health. Small-scale pig farmers, for instance, will have to compete with cheap imports from exporting countries such Canada, where pigs can be fed with growth and leanness enhancing drugs banned in Thailand for health reasons.

The CPTPP could also force Thailand to allow imports of GM products based on risk assessment made by other countries that are less stringent than Thailand's Biosafety Act, which is based on the precautionary principle and which considers socio-economic impacts. The end result will be more control over Thailand’s food system by a small number of giant corporations, leaving consumers with hardly any alternative sources for their food.

Thailand's experience with the Covid-19 pandemic has clearly shown that our highly diverse, small-scale food systems are critical and resilient. A survey of rural communities in different localities found that communities have suffered very few impacts to their local food systems. Fresh markets continued to operate to distribute food to local people continuously without fail throughout the last 3-4 months of lockdown. A significant number of farmers have increased their production of vegetables and are taking them for direct sale in local markets.

There has also been a rise in itinerant sellers visiting neighboring villages and of people going directly to farms to purchase foods. Some farmers have experienced increase incomes, because there is an increase demand for fresh vegetables. Farmers who produce using sustainable agriculture methods have received much greater interest. Farmers who produce for the export or large-scale markets, which have to rely on transport, have experienced serious problems in selling their produce, when middlemen stopped coming to buy from them.

Moreover, we found that people in the big cities, relying on food from the modern trade system, are beginning to understand more about food security, realising that they may not able to rely on large corporations alone for their food needs, but must also preserve the food production and distribution system in the hands of smallholder farmers and local markets. The fight against the CPTPP and corporate monopoly this time reflects the movement of an increasingly broad alliance to protect a sustainable and diverse food system.

Street vendors provide essential services in cities across the globe, particularly in Africa, Asia and South America, where residents rely on them for basic needs. They are part of a vast informal food system that keeps much of the world from going hungry. But the pandemic has devastated the livelihoods of street vendors, disrupting their ability to do their jobs and leaving many in a fight for survival.In this installment of WIEGO’s global analysis of news related to street vendors, we dive into the impacts of measures to prevent the spread of COVID-19 on vendors but also look at how street vendors are innovating in the current situation.

Lockdowns being enforced across the globe have thrown the world’s two-billion informal workers into turmoil – and street vendors, whose livelihoods rely on being in public spaces – have been particularly hard hit.

Some cities and countries have allowed trading to go on, but vendors have had to make serious adjustments to their work and home life. In Uganda, vendors resorted to sleeping in markets so they could continue to earn a living while avoiding contact with their families. Even in cities where they are allowed to vend, street vendors reported a 90-percent drop in their income due to reduced foot traffic in places such as México City, Accra, Los Angeles, and New York City.

Other countries have implemented bans on vending altogether, making the situation dire. With cities deserted or closed, street vendors say that if they are not able to work, their families will simply die of hunger. From Latin America to South Africa to Nigeria to India, the ban on street vending has left street vendors out of work or unable to trade. Many street vendors expressed fears over their inability to feed their families during the lockdown, which could leave many fighting starvation next.

Street vendors themselves will not be alone in the fight for food. Low-income households that rely on street vendors for their food supply now have to pay more to access food. That could have widespread impacts. A UN report warns that this pandemic could double the number of people suffering acute hunger, create a global recession that could disrupt food supply chains, and add to the struggles and particular concerns of people working in the informal economy.

Unfortunately, some media coverage accuses informal food vendors of being vectors of infections, which only adds to the burdens of an already vulnerable group of workers who are putting themselves at risk to earn a living. These kinds of reports overlook the role of city governments in ensuring they manage and reduce these workers’ occupational health and safety risk as they keep food supply chains running.

The economic crisis brought on by the pandemic has exposed the extreme vulnerabilities of urban migrants. In India, lockdown measures were abruptly put in place without accounting for the country’s vast informal economy – 90% of workers, with many being migrant workers who found themselves without work or shelter in a matter of hours.

Migrant workers in the United States were also left vulnerable. The economic support measures put in place left out migrant workers, many of whom are street vendors working in major cities. Some US cities are pushing for the creation of an excluded workers' fund to get relief to undocumented workers.

In Colombia, more than 1,000 street vendors demanded help from Bogota’s government, with a large majority of them Venezuelans facing evictions amid the quarantine measures. Bogota’s mayor, whose liberal policies have supported migrants during the migration crisis, released a statement on migrants (informal workers) that was seen as discriminatory during the COVID-19 crisis, adding new challenges for these workers.

Even where vendors are allowed to sell on the streets, the situation is extremely challenging. Municipalities in Peru, Honduras, and the U.S. have resorted to punitive measures against street vendors during the lockdowns, such as relocations, evictions, vending bans, and police fines.

In India, the first day of the shutdown witnessed blind police brutality against street vendors, while authorities in Oman also cracked down on street vendors. In Uganda, where police beat vendors who refused to clear the streets, human rights advocates pointed out that basic human rights should be at the center of any government response to the pandemic.

Melody Ndawana of the Zimbabwe Chamber of Informal Economy Association (ZCIEA) fears this clearing of streets, violence and harassment could carry on past the lockdown. She said, “We thought after the lockdown we could return to our workplaces, but now local authorities are destroying them.”

With many street vendors facing near total loss of customers, they say the only way to survive is to get economic help from their municipalities. This need has led to street vendors protests in México, Guatemala, Paraguay, and Colombia, as they demand financial support from their governments or safety protection in their workplace.

Street vendors are among those who may slip through the cracks of other labor protection measures. Because of this, Pope Francis said it might be “time to consider a universal basic wage” in his Easter letter. The Economic Commission for Latin America and the Caribbean (ECLAC) has accounted for more than 200 economic measures throughout the region to protect informal workers, including street vendors. In addition, South Africa, Pakistan, Brazil, Perú, Ecuador, El Salvador, and India have all given out cash grants or financial support.

Street vendors and informal workers have been raising their voices for their immediate needs and have achieved a few wins. A significant victory for the sector was recorded in South Africa, where informal food traders got the green light to trade during lockdown measures. This led to work with public health experts to develop safety guidelines for informal traders to minimize the risk of both contracting and spreading COVID-19.

Stories of solidarity and innovation have also emerged. In Spain, street vendors worked to help to deliver food and medical supplies. And in Barcelona, street vendors joined forces with a local clothing company to sew masks and aprons for health workers. In Malaysia, street vendors came up with ways to work during lockdown with a drive-through, pack and pick, and e-hailing service. In Washington D.C., in the US, street vendors worked with the city by becoming public health ambassadors to help with the work of curbing the spread of coronavirus. In Piura, Perú, street vendors and the municipality came up with a creative idea to demarcate vending spaces to allow them to trade while keeping physical distance.

Even when governments begin to lift the lockdowns, the economic impacts will have lasting consequences for many. With the UNDP warning of economic devastation for developing countries, African leaders issued a warning that if the virus spreads across Africa and the lockdown restrictions stretch to weeks or even months, an economic collapse may be inevitable.

Economic impacts on the informal sector will be felt strongly, pointing to examples like Uganda, where the informal sector contributes to 50% of the country’s GDP. The ILO chief said that the COVID-19 impact could cause the equivalent of 195 million job losses and that informal workers, such as waste recyclers, street vendors, and domestic workers, “not only carry a high risk of virus infection but are also directly impacted by lockdown measures”.

The crisis has amplified existing inequalities but is also an opportunity to “reset”. As António Guterres, UN Secretary-General, said during the launch of the Report on Socio-Economic Impacts of Covid-19, "The recovery from the COVID-19 crisis must lead to a different economy.”

At the city level there is an opportunity to address long-called for infrastructural disparities – in housing, water and sanitation – and to provide vendors shelters, water points, and storage. For informal workers in general there is an opportunity to address the long-needed incorporation into social security systems. Informal workers are fleet footed and have many solutions of their own, so it is critical to work alongside them in building people-centred alternatives for a new economic vision.

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When the government of India shut down the country on March 24, a certain sector received special protections: e-commerce. The lockdown order granted no such privileges to the Food Corporation of India, the agency that the poorest depend on for food rations—yet retail platform companies in food, medicine, and medical equipment were categorised as essential services and allowed to continue their operations.

This unequal treatment was a candid admission that e-commerce companies have become infrastructural utilities indispensable to India’s aspirational middle class. Prior to the lockdown, Flipkart, an Indian e-commerce unicorn acquired by Walmart for USD 16 billion in 2018, had extended a hand to the government, offering to partner in any programme for the delivery of essential commodities. Then, immediately after the lockdown began, Indian e-commerce companies met with the Minister of Commerce and Industry, asking for an expedited channel for trucks and suggesting that consumers, and not the government, should decide which items are essential.

History has shown that wars, natural disasters, and epidemics are often followed by disaster capitalism: calculated, free-market “solutions” that exploit and exacerbate existing inequalities. During the COVID-19 crisis, disaster capitalism is evident in the zeal that e-commerce platforms in India have displayed. For these companies, the lockdown is the moment to consolidate their dominance in the market. The pot at the end of the rainbow must be claimed now, and the traditional retail sector—grocers, pushcart vendors, neighborhood traders who have actually been catering to the public in these trying times—rendered irrelevant.

Indian commerce in the time of COVID-19

The pandemic has intensified the already snowballing crisis for small retail. Social distancing measures and fears of contagion have led to lost revenue that exacerbates the financial stresses on the sector, according to the Retailers Association of India. The lockdown has worsened the cash flow crunch as consumers rapidly switched from brick-and-mortar retail to e-commerce.

Even prior to the outbreak of the pandemic, e-commerce had already been poised for a phenomenal breakthrough in India. Industry analysts estimate that over 175 million Indians will shop online in 2020, a 46 percent jump from 2018. Then came COVID-19. Surveys of the Indian market indicate that hyperlocal e-tail businesses (such as grocery) registered a 45 to 50 percent growth in overall gross merchandise volume in the first two weeks of March when compared to the same period in February. During the lockdown period alone, Amazon and Flipkart, as well as e-grocers such as Alibaba-backed BigBasket and Grofers, reported a two- to threefold increase in orders.

Companies are diversifying as well. At the height of the crisis, BigBasket acquired the milk delivery start-up DailyNinja, gaining control over the latter’s network of 110,000 consumers and 2000 dairy producers across the country. Food-delivery platform Zomato is launching a new business-to-business grocery vertical called Hyperpure to focus on supplying farm produce to restaurant partners, while Swiggy, a similar start-up, is re-deploying its food delivery workforce as grocery delivery and concierge services. The landscape has changed and when the crisis passes, it can never return to normal as we knew it.

In this re-engineering of supply chains, e-commerce companies have one critical actor to reckon with: the kirana store, or the neighbourhood, mom-and-pop retail outlets. The kirana stores were vulnerable before the pandemic, as changes to economic policy in India between 2016 and 2019 led to a slump in consumption, pushing them into a corner. Still, current estimates suggest that the humble kirana store accounts for over 90 percent of the USD 44 billion of fast-moving consumer goods sold in India each year. The battle for the Indian e-commerce market cannot be won without a strategy for capturing the kirana stores, and major e-commerce players recognise this.

In late 2019, in the months just before the pandemic, e-commerce companies were busy wooing the beleaguered kiranas. JioMart—the e-tail offering of Reliance Jio, the largest telecommunications company in India—launched the Jio point-of-sale (PoS) machine for kirana store vendors in order to gain a firm hold over its distribution segment. In late April, spurred on by a USD 5.7 billion Facebook investment, Reliance Jio started a Whatsapp-based hyperlocal grocery service on Jiomart, connecting customer orders to local kirana store partners. Amazon and Flipkart have launched very similar initiatives through their ‘Local Shops on Amazon’ and ‘Buyzones’ programme, and have pushed their payment wallets AmazonPay and PhonePe. (Amazon is also in early-stage talks to buy a stake in Bharti Airtel, Jio’s telecom rival.)

If they are to survive, these local stores (and even wholesalers and distributors) may have no option but to integrate into one of these big platform companies. Yet, roped in as ‘partners’ in a highly skewed equation, kirana stores now subsidise e-commerce big business in stocking, inventory management, and the delivery of goods. Reports from the ground suggest that e-commerce platforms are already using the data from kirana partners to acquire intelligence about hyperlocal consumer demand and launch their own ‘dark stores’ network, or distribution outlets that only fulfill online orders.

The end game for JioMart, Amazon, and Flipkart is to push their own grocery and private-label business through the kirana stores. Irrespective of which e-commerce platform wins the race, kirana vendors will eventually lose their space and autonomy in the datafied retail market.

Only e-commerce giants will have the ability to gain resilience post-COVID and achieve economies of scale in this context, in terms of sophisticated AI, robotics, and IoT. E-commerce platforms dream big and their cash burn models are built to embrace ventures across different sectors. For example, Amazon in 2018 acquired the US online pharmacy PillPack and established its ambitions in health care (which partly explains Jeff Bezos’ public-spirited motivation during this crisis). As a result, retail is poised to see a second digital disruption, a new normal with significantly higher concentration of market power.

The longer-term prognosis is worrisome. Governments fighting job loss and recession may find it easy to give in to these corporatised, new age public utilities, allowing them to lead the way and looking away from their predatory market practices.

The critical policy questions for the coming years will be how governments can regulate companies and prevent market consolidation by digital behemoths. What will an ideal version of the e-commerce policy look like? Will the proposed ‘equalisation levy,’ a tax proposed on non-resident e-commerce companies be imposed? How are ‘foreign direct investment in e-commerce’ norms likely to change? Will they be re-clarified to allow e-commerce platforms to invest in or even acquire a majority stake in traditional retail?

The opportunity to reimagine e-commerce is immense. Policy measures must promote public infrastructure—digital and physical connectivity, warehousing, smart logistics and delivery—that encourages alternative, locally embedded platform marketplaces to secure the future of the small and medium retail sector. For instance, it is possible to set up an e-commerce platform marketplace that is owned by a cooperativist federation of small producer/retail enterprises, operating on a fixed fee rather than a commission basis, and deploying responsible data practices for the collective benefit of enterprises on the platform. With policy and financial support, such cooperativist platforms linked to local production and consumption can play a strong role in reviving local economies.

They can also help create a more equitable digital economy. Just as in the United States, in India, too, workers associated with e-commerce platforms have mobilized against exploitative conditions during the crisis, while activists are starting to worry about the economic impact of market concentration in the sector on issues of strategic concern such as food sovereignty. Small traders in India attempted to partner with the government to launch an alternative e-commerce marketplace that works for traders, workers and consumers. The old model of retail will not come back, but policy actions to promote a new digital regime that works for all can avert the devastating consequences of post-corona disaster capitalism.

The cruel irony is that interest in local food and demand for emergency food needs have skyrocketed during the pandemic, making the work of farmers’ market operators more important than ever. And yet, they have largely been left out of relief efforts, both public and private.

Recognizing that the lockdown to contain the spread of Covid-19 would break the food supply chain, the Municipal Corporation of Ahmedabad, India, announced an innovative initiative called “Vegetables on Wheels” to deliver fresh vegetables and milk to curfew wards of the city by e-rickshaws (electric 3-wheel rickshaws). The initiative is in partnership with Self-Employed Women’s Organization (SEWA), a trade union of nearly two-million women informal workers including fresh vegetable and fruit vendors based in Ahmedabad.

The initiative works like this: street vendors are engaged to provide essential food and milk to the citizens in areas of the city that are under curfew due to high concentrations of COVID-19 cases. The AMC issues a curfew pass to the designated vegetable vendors that allows them to go to the wholesale markets in the early morning to buy vegetables, which they transport back to their homes.

A “just recovery” from the Covid-19 crisis requires that we think beyond food relief, and make changes to our food system now. Those who are most vulnerable are often those who are producing food – including the farmworkers and the small-scale farmers. Spikes in food prices in the supermarkets are at the cost of the poor – both as producers and as consumers. This need not be the case.

Covid-19 shows in sharp relief how markets fail. Markets are social institutions. We build them, and we can change them. Let’s start now.

Facebook announced it was investing US$5.7 billion in Reliance Jio Platforms to secure a 9.9% stake of the Indian firm, a subsidiary of Reliance Industries, the most valued firm in India. It was said that more than 1,200 neighborhood stores are engaging in the pilot program. Meanwhile, Walmart is leading a US$1.2 billion funding round into its Indian e-commerce service Flipkart as it faces challenges from the coronavirus pandemic and the entrance of rival platform JioMart.