A vote in the European parliament has failed to remove loopholes in new regulations to prevent banks driving up food prices through financial speculation.
MEPs voted in favour of limits to speculation, but allowed loopholes to remain which risk rendering the new rules ineffective, reports Miriam Ross from the World Development Movement, a campaigning NGO.
Activists in Britain sent more than 14,000 messages to their European Parliament elected representatives last week, joining many others across Europe.
They asked them to stop food speculation by banks and hedge funds pushing food prices beyond the reach of millions of the world’s poorest people.
World Development Movement campaigner Christine Haigh commented: "Watertight regulation is essential if we are to stop excessive speculation fuelling devastating food price spikes."
If they remain in their current form, the controls will be too weak to properly tackle speculation. Now it’s down to Chancellor George Osborne and his fellow finance ministers to back strict rules," she added.
If the amendments to remove the loopholes had been passed, WDM points out that they would have:
* Ensured that the limits apply to all commodity contracts, for their full duration, and including any contracts that cannot be traded on exchanges;
* Enabled limits to be applied to groups of traders (for example financial speculators) as well as individual traders;
* Clarified the function of the limits;
* Ensured that regulators receive information to oversee the markets on a regular basis.
European finance ministers are now due to vote on the proposed regulation on 13 November 2012.
World Development Movement: http://www.wdm.org.uk/