GEOG 128
Geography of International Affairs

The International Economic Order - Neoliberal Capitalism


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Summary of the film

Click for a transcript of "Luckiest Nut in the World" video.


SINGER: This is a film about nuts.

CHORUS: Nuts, nuts, nuts.

SINGER: It's a film about nuts.

CHORUS: Nuts, nuts, nuts.

SINGER: That's right. Like peanuts and pecans, pistachios too.

BASS SINGER: Brown nuts, Brazil nuts, and the cashew.

CHORUS: It's nuts.

SINGER: That's what I said. It's a film about nuts.

SINGER 2: It's a film about trade and economics.

CHORUS: It's about nuts.

SINGER 2: It's a film about globalization.

CHORUS: Nuts are grown all over the world.

BASS SINGER: Touching every life in every nation.


PRESENTER: Starring Mr. Peanut, the luckiest nut in the world. And the rest of his gang. Hit it, boys.

CHORUS: Just in case you forgot what this film is about.

SINGER: This is a film about nuts.

CHORUS: Nuts, nuts, nuts, nuts.

PEANUT: OK. Let's get started. This is a bowl of nuts.

PRESENTER: Typically eaten as a savory snack, nuts have a wide range of culinary uses. Nuts are grown all over the world and often traveled many miles to get to your table.

PEANUT: And some of them have had a bumpy ride, but not me. Because I'm an American peanut. I was born in Georgia, in the deep South, with a silver spoon sticking out of my mouth. I sure was surprised when I realized I was allowed luckiest nut in the world. I traveled around all over the globe. And I was pretty shocked at what I seen. All around there were nuts struggling to survive.

CHORUS: While he was living the American dream.

PEANUT: Our politicians tell us that trade liberalisation is going to make things better. But what exactly is trade liberalisation?

PROF BROWNE: Liberalization is the process of becoming more liberal or free. Trade liberalisation is therefore making trade more free by removing trade restrictions.

PEANUT: Well, I suppose in theory it sounds pretty good. We all like freedom. But from what I've seen, things aren't exactly working out as planned.

CHORUS: We're going to tell you some stories that'll make it clear why these problems won't disappear.

PEANUT: By making trade free indiscriminately,

CHORUS: It's only making things worse. It's not a blessing, but a curse.

PEANUT: And it's happening more every year.

This is a groundnut.

CHORUS: He's a ground nut.

PEANUT: Ground nuts are part of the peanut family.

CHORUS: Cousin of the peanut.

SPEAKER 1: Did you know that peanuts and ground nuts aren't really nuts at all?

SPEAKER 2: What are they, then?

SPEAKER 1: They're legumes.

PEANUT: This groundnut originated in Senegal, a country in west Africa.

CHORUS: Ground nuts have been grown in West Africa for centuries.

PEANUT: They were brought to Africa by the Portuguese in the 16th century. And later on--

CHORUS: Ground nuts replaced slavery as Senegal's biggest industry.

PEANUT: And by the time Senegal got their independence in 1960, ground nuts were their main export crop.

PROF BROWNE: By specializing in the thing that a country does best and then trading for the other things it needs, it maximizes its productivity.

CHORUS: But like many newly independent African states,

PEANUT: Senegal lacked the resources to invest in their development.

CHORUS: They needed cash.

PEANUT: So they got some help from the World Bank.

SINGER: There's a lot that you need if you want to succeed as a viable industrial nation. You need car parts and roads, bridges, telephones, dams, drains, and irrigation. If you need a little cash, we'll help you in a flash. The World Bank will come to your aide. We'll loan you some dough, so that you can grow and compete in international trade.

LENDER: We're satisfied as to your credit and income and we're glad to make you the loan.

PEANUT: The World Bank encouraged Senegal to focus on exports to earn the cash to repay this debt.

CHORUS: And Senegal's main export was groundnuts.

PEANUT: But then in the '80s, something happened that no one had counted on. Because groundnuts appeared to be a lucrative and stable export crop, other developing countries began to focus on producing ground nuts as a means of earning foreign currency.

PRESENTER: Across the globe, groundnut production is booming. From the Far East in China to the wilds of Ghana, farmers are saying goodbye to their traditional crops, hoping to get it on the ground floor of this thriving industry.

PEANUT: As more and more countries were producing groundnuts, more groundnuts were on the market. And so the price fell.

PROF BROWNE: It's the law of supply and demand. When supply goes up without a corresponding increase in demand, the price will go down.

CHORUS: With the bottom falling out of the groundnut market, Senegal, Senegal, Senegal was getting less for their nuts.

PEANUT: And they had to borrow even more money just to keep their head above water. Facing bankruptcy, Senegal implemented an economic reform program with the aide of World Bank economists.

SPEAKER 3: See, The World Bank doesn't just lend money. But the also lend expert advisors.

SPEAKER 4: Yeah, right. Experts in making sure they pay the debt.

PEANUT: This program followed the economic thinking of the time and called for--

CHORUS: Trade liberalization.

PROF BROWNE: Which begins with the removal of tariffs and duties.

PEANUT: So taxes on imports of foreign nuts were removed.

CHORUS: And privatization.

PROF BROWNE: Reducing government's involvement in industry.

PEANUT: The state-run groundnut company, Sonacost, which had guaranteed prices to the farmers was partially privatized.

CHORUS: And caps in public spending.

PEANUT: So state programs to help farmers by seeds, fertilizers, and tractors were all cancelled. They implemented the new strategy for 10 years, but the situation only got worse.

CHORUS: As the price of nuts went down, the debt got out of control.

PEANUT: And today, Senegal is officially one of the world's most indebted nations.

CHORUS: They spend more on paying their debt than they do on health and education combined.

PEANUT: So the theory goes that you should borrow to invest, and put the money in the one thing that you do best. Well, the Senegalese, they put their faith in nuts and they ain't exactly impressed. With all the payments to me, it's hard to stay on your feet, let alone compete with the rest.

PRESENTER: Now let's have a look at this cashew nut. He originated in Mozambique, a country in East Africa.

CHORUS: Cashew nuts are one of Mozambique's main exports.

PEANUT: That's right. And cashews are grown all over the country.

CHORUS: By people like this man and these two.

PRESENTER: Cashew nuts grow from trees, suspended beneath the cashew apple. Once separated from the apple, the removal of the hard outer shell must be done with care, as the shells are highly toxic. With this is achieved, the nuts can be enjoyed and have a rich, succulent flavor.

PEANUT: In the 1990s, there was a growing processing industry. Over 10,000 people were employed in the factories, shelling and roasting cashew nuts.

CHORUS: People like this man and this man and these.

PROF BROWNE: Processing increases the value of the nuts, and allows Mozambique to profit more from their exports.

CHORUS: This is what we mean by industrial development, oh yeah.

PEANUT: But a processing industry needs nuts to process, and too many raw nuts were being sold abroad.

PRESENTER: Down in Mozambique, cashew nuts are leaving in the thousands, bound for parts unknown. Good luck, Mr. Cashew. And bon voyage.

PEANUT: But the government had a plan. To keep enough raw nuts in the country, the Mozambique government would impose a tax on the export of raw nuts.

EXPORT OFFICER: I'm sorry, sir, but you will have to come with me.

PEANUT: Once processed, the nuts could leave at no charge.

EXPORT OFFICER: Right this way, sir. Good day, sir. Right this way.

PEANUT: That way, more raw nuts would stay in the country.

CHORUS: And the factories would have enough nuts to keep them busy.

PEANUT: Like Senegal, Mozambique was deeply in debt and they desperately needed some help.

SPEAKER 5: What collateral can you offer for this loan?

SPEAKER 6: I can offer only my record and my present salary.

SPEAKER 5: I'm very sorry, but I'm afraid we can't accommodate you.

PEANUT: Then the IMF and the World Bank came to their aide.

CHORUS: Oh, oh, oh, they would be saved.

SINGER: If you get it in a sweat because you can't pay your debt, things aren't working out as planned. The International Monetary Fund will come and lend a helping hand. The first thing they'll do is they'll give to you a little bit of emergency lending. We'll send our top economists who will probably insist you embrace free trade, open up your markets and cut back on public spending.

PEANUT: But the help would come at a price. As a condition of their loan, Mozambique would have to abandon its plan to tax raw nut exports.

PROF BROWNE: The IMF's policy was based on the concept of the free market.

PEANUT: Their economists believed that a free trade in cashew nuts would allow the farmers to sell to the highest bidder.

AUCTIONEER: And let's have the beginning bid. Thank you, sir. Thank you at the back. Yeah.

PEANUT: The Mozambique government disagreed with this analysis, but the IMF insisted.

CHORUS: Oh, oh, oh, they put their foot down.

PRESENTER: Of course, Mozambique didn't have to comply. But if they didn't, they face bankruptcy.

PEANUT: At first, it seemed that the IMF was right.

CHORUS: For a while, the price of cashews did go up.

PEANUT: Farmers were getting more for their nuts, as foreign companies competed with local factories to buy their crops.

CHORUS: Yeah, the price went up, up, up.

PEANUT: The price went so high, the local factories could no longer afford to buy them. The industry dwindled.

CHORUS: And one by one, the factories shut down.

PEANUT: By 1999, 9,000 people had lost their jobs.

SPEAKER 7: Unemployment is just a fact of life.

SPEAKER 8: Yeah, and what I hear is, it was good for the farmers. And there's over a million of them.

PEANUT: But that was only the beginning. With no competition from the local factories, the market became dominated by two export companies, who could dictate their price.

AUCTIONEER: Sold at half the going rate.

PEANUT: The farmers had to sell their nuts to them, whatever the offer.

CHORUS: And the price went down, down, down, lower than it was before.

PEANUT: So within a few years, the cashew processing industry had been destroyed. Thousands of factory workers were without jobs and the farmers were getting less money for their raw nuts.

CHORUS: No, things haven't worked out well for Mozambique.

PEANUT: And now after all this, the IMF has conceded that they were wrong and is allowing Mozambique to implement their original plan. So you see what havoc the free market can wreck on a poor country like Mozambique. Free trade may be swell when you're doing well, but it ain't always great for the weak.

NUT 1: Coming up--

NUT 2: The Brazil nut.

PEANUT: This is a Brazil nut.

CHORUS: Brazil nuts only grow in the Amazon rainforest.

PEANUT: But unlike the name suggests, most Brazil nuts don't come from Brazil. They come from Bolivia.

CHORUS: Three quarters of the world's Brazil nuts come from Bolivia.

PEANUT: Brazil nut trees can only grow under the protection of the rainforest canopy.

PRESENTER: This specific species of bee, which pollinates the Brazil nut flower lives in the orchids which occur naturally in the grooves surrounding the Brazil nut trees. The trees will not bear fruit without these little helpers.

PEANUT: And because they provide an economic alternative to clear cutting and open mining--

CHORUS: Brazil nuts have been singled out as a good example of sustainable agriculture.

PRESENTER: The traditional harvesting method involves waiting for the pods to fall to the ground, and then gathering them from the rainforest floor. The pods are then opened with a hatchet or similar tool, and the nuts taken to the processing plant to be deshelled.

PEANUT: Brazil nut harvesting encourages the Bolivian people to take advantage of the natural resources of the rainforest.

CHORUS: Oh, that's conservation.

PEANUT: Like Mozambique, Bolivia has encouraged the development of a processing industry to get added value from their nut exports.

CHORUS: That's industrialization.

PEANUT: In the 1990s, with the help of charities and NGOs, the Brazil nut industry boomed in Bolivia.

CHORUS: They helped them to build factories and to get their nuts to market.

PROF BROWNE: In the Amazon region of Bolivia, 80% of households live in extreme poverty.

PEANUT: Expansion of the Brazil nut industry gave these people a significant rise in their standard of living.

CHORUS: They got roads, power, clean water, and medicine. Things were looking up.

PEANUT: However, in 1999 a change in EU health and safety regulations seemed to threaten the future of the Bolivian Brazil nut industry.

SPEAKER 9: All tree nuts are susceptible to a naturally occurring fungus, which can leave traces of a carcinogen known as aflatoxin. Aflatoxins are measured in parts per billion, which is one particle per billion other particles.

PEANUT: Because of the way Brazil nuts are harvested from the rainforest floor, they often have a slightly higher level of aflatoxin compared to nuts grown on industrialized plantations.

CHORUS: The internationally recognized safety level for aflatoxins is 20 parts per billion.

PEANUT: Bolivian Brazil nuts have complied to this standard for years.

CHORUS: Then in 1999 the EU lowered its accepted level to four parts per billion.

SPEAKER 9: Four parts per billion is easily achievable on industrialized plantations.

SPEAKER 10: But it's much more difficult in the Amazon rainforest.

CHORUS: Because you can't build a factory there.

PEANUT: So although this new health and safety regulation applied to all nuts imported to the EU, it happened to hit Bolivia the hardest.

CHORUS: So much for sustainable agriculture.

SPEAKER 11: Did you know that Europe is the biggest single market for Brazil nuts?

SPEAKER 12: Yes. And they're considered to be a luxury commodity.

PEANUT: Europe and Bolivia are both members of the World Trade Organization.

SINGER: With 137 member nations, we have no geographical affiliations. From the Sahara to the Pacific, our aim, it is quite specific. Through a process of complex negotiation, we encourage and promote trade liberalisation. We're the final arbiter in any dispute. Our members must accept our rules as absolute. We never rest in our crusade to grease the wheels of trade. We're the World Trade Organization.

PROF BROWNE: Within the WTO, countries are allowed to set their own health and safety standards for food imports. But they are expected to provide scientific evidence to back them up.

PEANUT: Bolivia argues that there is no scientific evidence to suggest that four parts per billion is any safer than 20 parts per billion. The EU claims that it is just being cautious.

DOCTOR: Just how many Brazil nuts did you say you ate?

SPEAKER 13: You know, they could just be doing this to protect their internal nut producers.

SPEAKER 14: Well, that would be difficult to prove.

PEANUT: Whether safety precaution or trade protection, the EU's new regulation is certainly causing trouble for Bolivia.

CHORUS: So what can they do about it?

PEANUT: Bolivia has complained in WTO committees.

CHORUS: So far, with little success.

PEANUT: They're planning to launch an official dispute process.

CHORUS: But that could take years and meanwhile, Bolivia's a mess.

PEANUT: So with a natural monopoly on the Brazil nut, Bolivia was onto a good thing, but one little change in EU legislation put the industry in a tough situation. If everything was equal and the playing field level, they could tell the Europeans to go to the devil. But when you need your partner more than they need you, you have to do just what they tell 


The Luckiest Nut in the World from Emily James

The film follows an animated American peanut, who sings about the difficulties faced by nuts from developing countries.

Supported by a mixture of animation and music, our American peanut takes the viewer through the stories of the cashew, brazil, and ground nuts — all of whom suffer as world trade is liberalized. But, it is a different story in America — where the peanut is protected by tariffs and heavily subsidized, and worth over four billion dollars a year to the American economy. Certainly, the luckiest nut in the world.

The film helps people to understand how the pressure to embrace “free market” economics, with its promise of a wealthy, abundant market place has actually driven many countries further into poverty.