Poverty Footprint Study on how the Coca Cola - Oxfam America

The union is an excellent organization;
it helps workers, intervenes
before the management and
negotiates for everybody.
—Employee at El Angel sugar mill
Limited voice of informal sector workers
Individuals working in the informal sector rarely have
the opportunity to organize themselves into groups
or associations in order to collectively advocate for
policies and practices in their interest. The sugarcane
harvesters and independent distributors and retailers
in the Coca-Cola/SABMiller value chain are no
exception. Without a collective voice, they are often
unable to influence government or business policy
that would have the potential to improve their lives. In
Zambia, only a limited number of retail owners belong
to organizations such as the National Association
of Marketers, which advocates on issues such as
amenities in the marketplace, licensing and fees paid
to local authorities.
Influencing price negotiations
This research did not address the role of SABMiller
and The Coca-Cola Company in price negotiations.
Sugarcane producers often have little ability to impact
sugar price negotiations when selling their product
to mills. The highly oligopolistic55 nature of sugar
processing in many markets where there are very
few mills, coupled with the regulatory restrictions
such as quotas and fixed domestic pricing, means
In the company there is no union,
because the employees have
a fear of getting fired.
—Employee at El Angel sugar mill
that producers have next to no influence on price
negotiations. This is particularly true in relation to the
raw materials directed to the processor.
Smallholder farmers in Zambia interviewed for this
study report having no say in price negotiations
with Zambia Sugar. In El Salvador, sugar producers
reported that they had little power to directly negotiate
the price they receive for their sugar from the mills,
even as their costs rise. Their rising costs, which are
not accounted for in the maximum prices regulated
by the government for the domestic market, are one
of the main arguments sugarcane producers make
against increasing worker pay. There are various
sugar producer associations, such as PROCANA56 ,
as well as various producer associations, but none of
them represent all sectors and small-scale farmers
are usually underrepresented. According to the
national sugar legislation, the net income of all the
sugar and molasses produced is shared by cane
producers (54 percent) and mills (45.5 percent).
Exploring the links between international business and poverty reduction 55