New Internationalist

The Facts

Issue 167

new internationalist
issue 167 - January 1987

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Patterns of power
There were empires in the ancient world but they did not span the world.
It was not until ocean going ships and the guns they carried were improved
that imperialism could create a world-wide economic system. The extent of
such dominance can be seem below - along with its present-day effects.

HISTORY

THE LEGACY OF PILLAGE

The fabulous profits of opium dealing with China, slaving between Africa and the Americas and other trade with colonies helped to make possible the Industrial Revolution in Europe and the US.

  • Between 1500 and 1750 more than $1,500 million in profits and goods was acquired by Western Europe from it's overseas colonies.1

  • Between 1503 and 1660, 185,000 kilos of gold and 16 million kilos of silver arrived in Spain from the Americas, to swell European economic expansion.2

  • The total British plunder of India between 1757 and 1815 amounted to £1,000 million ($1,500 million); the national income of Britain in 1770 was about £125 million ($190 million)'. (Teresa Hayter, The Creation of World Poverty 1981).

  • Direct tribute payments to the British Crown alone as payment for monopoly control of the trade with India by the East India Company often amount to £1 million ($1.5 million) a year.3

  • Between 1760 and 1780 profits from the West Indies and India probably doubled the amount of capital investment in the Industrial Revolution in the UK.4

  • In 1789 France exported to her colonies 78 million livres of food stuffs and received sugar, coffee and other products worth 296 livres in return.5

TRADE

TRADE: EXPORTS LOSING VALUE

Nearly half the fall of inflation in industrial nations between 1980 and 1984 was paid for by the commodity price collapse in the Third World.6

[image, unknown] Between 1980 and 1985 the prices of food and raw materials exported by developing countries fell by a fifth in real terms.7 In other words, by 1985 developing countries had to export 20 per cent more sugar, cotton or tin, for example, simply to be able to import the same quantity of water pumps, trucks or fertilizer8

Between 1981 and 1985 developing countries lost $5,300 million on average every year because of damaging changes in 'terms of trade' (the movement of the prices of a nation's principal exports in the international markets in relation to those of its major imports). Commodity prices (excluding oil) fell by 18 per cent between January and September 1986 measured against a basket of world currencies Oil prices are now at halt their 1985 levels.9


POLITICS

GUNBOAT DIPLOMACY

Since 1945 the US intervened on average once every 18 months somewhere in the world.
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Since 1945 intervention
has included:

Soviet military intervention
has included:

1950

Korea

1950

Korea

1953

Iran

1953

E. Germany

1954

Guatemala

1956

Hungary

1958

Lebanon

1961

Cuba

1959

Thailand

1965

Vietnam

1959

Laos

1968

Czechoslovakia

1961

Cuba

1970

Egypt

1963

British Guiana

1975

Angola (through Cuban forces)

1964

South Vietnam

1977

Ethiopia (through Cuban forces)

1964

Brazil

1979

Afghanistan

1965

Dominican Rep.

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1968

Cambodia

1968

Laos

1973

Chile

1975

Jamaica

1981

Nicaragua

1983

Grenada

1984

Lebanon

1986

Libya


Dates given above are the first year of intervention; occasionally this becomes semi-permanent. For example Soviet intervention began in Ethiopia in 1977 and still continues.10


INVESTMENT

POUND OF FLESH

Between 1950 and 1967 new US investment in Latin America was $3,900 million. It was only a third of the $12,800 million profits repatriated from Latin America by the US companies over the same period.15

The financial rate of return on the investments of multinational companies in the Third World is twice as high as the profits in industrial countries.16

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WEAPONS

MILITARY AID

These days more weapons are sold to developing countries by the superpowers than are given away. The volume of the world arms trade is increasing by roughly 10 per cent annually.11 The weapons are sold to boost export earnings and win political friends and influence people overseas.

The US and the USSR supplied two thirds of the weapons imported by the Third World between 1981 and 1985 to a value of $44,000 million.12

The superpowers often provide sizable subsidies to Third World purchasers. The US in 1986 provided $3,100 million in military aid to Israel and Egypt, and another $4,100 million in economic aid.13

Major Arms exporters 1981 - 198514
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BUSINESS

MULTINATIONAL CONTROL

In 1983 the combined sales of the world's top 200 corporations exceeded $3,000,000 million, which is the equivalent of one third of the total gross domestic product of this planet. 40 per cent of all international trade is conducted between these multinational companies.18

In 1985 the sales of the tobacco, coffee and beer corporation Philip Morris in the US totalled $16,000 million. That is more than 3 times the gross domestic product (GDP) of Kenya, greater than the GDP of Bangladesh and only a little less than the annual GDP of Peru.19

80 per cent of the world's oil is traded by just 7 major oil companies all based in industrial countries. 75 per cent of all coffee is traded by US-based Philip Morris and Swiss-owned Nestlé. 75 per cent of the tobacco business is controlled by just 7 companies, 67 per cent of the banana business by 3 firms and 35 per cent of the tea trade handled by Unilever.20

In 1983, of the world's 200 largest industrial companies, 96 were based in North America, 60 in Western Europe, 25 in Japan and 19 had their headquarters in the Third World.

This report was compiled by John Tanner

1 Mandel, E Marxist Economic Theory, 1962.
2
Galeano, E Open Veins of Latin America.
3
Mukerjee, R The Rise and Fall of the British East India Company, 1974.
4
Mandel, E op. Cit.
5
James, C L R The Black Jacobins.
6
UNCTAD Trade and Development Report, 1986
7
UNCTAD op. Cit.
8 UNCTAD op. Cit.
9
UNCTAD (telephone enquiry)
10
Keesings Contemporary Archives and Adomeit, H Soviet Risk-Taking and Crisis behaviour 1982.
11
Peace Pledge Union, The British Connection, UK 1986.
12
1 Stockholm International Peace Research Institute (SIPRI) Yearbook 1986
13
SIPRI op.cit.
14
SIPRI Op cit
15
Galeano E Open Veins of Latin America, 1974
16
Harris, N Of Bread and Guns, 1983
17
Annual Reports of Unilever, Lonrho, Rio Tinto Zinc 1985.
18
Transnational Information Exchange (TIE) Netherlands
19
Philip Morris Annual Report 1986
20
Tanner, J Beggar My Neighbour NALGO Education Dept.
21
TIE Netherlands

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