Here comes a letter to Vicky Ford on food speculation, licked into shape by Sheila, and delivered by Clare on behalf of the entire group.
Clare took it in person to the Tories’ Hardwick office on Monday, and staff promised to email it on to Vicky Ford in Brussels. Not quite a photo-opportunity, but one way to be noticed.
30 August 2013
Dear Vicky Ford
You will remember we have had some correspondence since a group of us met you in May last year to discuss the review of the Market in Financial Instruments Directive (MiFID). Experience since that meeting has underlined how this legislation provides a vital opportunity to protect the lives of millions of poor consumers worldwide.
There is a growing consensus, with evidence from a wide range of sources, that excessive financial speculation is itself exacerbating food price volatility and amplifying the impact of poor harvests, higher fuel and fertilizer costs, competition from bio-fuels and other pressures. While financial players profit, the poor face hunger and long-term damage from malnutrition, especially children. The situation in countries such as in sub-Saharan Africa dependent on food imports gets increasingly precarious.
More disturbingly, risky products & strategies that are emerging in the complex commodity derivative markets (SOMO “Challenges for Regulators – Financial Players in the Food Commodity Derivatives Markets“(Nov 2012) http://somo.nl/news-en/somo-news/challenges-for-regulators ) also reinforce the case for pro-active intervention by regulators, co-ordinated across Europe. The report highlighted the increasing role of “especially opaque financial players in commodity markets such as hedge funds and commodity exchange traded funds (ETFs)”.
In October 2012, European parliamentarians showed their commitment to tackling food speculation by ensuring position limits were mandatory rather than voluntary, and including some measures to make limits more difficult to circumvent. However, there are still more dangerous loopholes in the MiFID text that risk rendering the legislation ineffective.
As this legislation enters the trialogue phase, please will you act to ensure that these loopholes are eradicated and the need for strong mandatory position limits is reaffirmed.
Please will you write to the rapporteur for the legislation, Markus Ferber, and Kay Swinburne as the lead MEP on MiFID for your group, to ask them to support all the points included in the enclosed briefing in the final compromise text
Thankyou for the interest you have already shown in our concerns about this important issue.
pp. Sheila Brookes
On behalf of Cambridge World Development Movement