You wouldn’t think that free-trade deals could lead to a diabetes and obesity epidemic, but they have. Today, many countries in the global south are seeing an explosion of these afflictions – all because their governments welcomed in transnational food companies looking for new “growth markets” for poor quality, heavily processed or just plain junk food.
For big conglomerates to increase their profits, they need to develop and sell products aimed at hundreds of millions of the world’s poor. Many of these people and communities still eat food that they produce themselves, or buy from informal markets that sell local produce. These local food systems and circuits are their livelihood for untold numbers of people.
To reach these potential consumers, large food corporations are infiltrating, inundating and taking over traditional food distribution channels around the world, and replacing local foods with junk, often with the direct support of local governments.
Free trade and investment agreements have been critical to their success. The case of Mexico provides a stark picture of the consequences. Over the past two decades, the government of Mexico has signed more than a dozen free trade agreements and nearly 30 investment treaties that have opened up the countryside and the retail sector to transnational companies, putting Mexico’s food system up for grabs.
The North America Free Trade Agreement, signed in 1993, triggered an immediate surge of direct investment from the US into Mexico’s food processing industry. Between 1999 and 2004, three-quarters of the country’s foreign investment went into the production of processed foods. At the same time, sales of processed foods went up by 5-10% per year.