After two years of negotiations, the European parliament has reached a deal to clamp down on speculation in food markets
The Markets in Financial Instruments Directive restricts banks and hedge funds’ ability to bet on the prices of crops such as sugar, wheat, soya and corn – a practice blamed for food price spikes in recent years.
Campaigners say public anger over unpredictable prices created the momentum for reform. “The fact that the EU has listened to that anger is a victory for public pressure,” said Nick Dearden, director of the World Development Movement.
While the deal provides a framework for limiting speculation, its impact will depend on the specific trading caps adopted by individual nations. Still, activists said the long-awaited deal was a good start.
“This is good news for millions in the developing world,” said Marc-Olivier Herman, Oxfam’s EU economic justice policy lead. “It is also important for people across Europe struggling to cope with high and volatile prices.”
Photo title: Protesting food speculation
Photo credit: © World Development Movement