Finance industry’s demand for new sources of capital worldwide is having a serious negative impact on the enjoyment of human rights, a group of UN-appointed independent rights experts has warned.
The group noted in a statement issued in New York on Wednesday that the demand had always been targeted at satisfying investors.
Among the rights at risk from increasing speculation in the financial markets by hedge funds and other investment funds, are the right to safe drinking water and sanitation, it said.
The group added that food, adequate housing, development, and a healthy and sustainable environment, among others, were also at risk.
The Independent Special Rapporteurs and other experts expressed concerns about the gradual encroachment by financial speculators into new areas of economies, putting human rights at risk.
The statement was signed by 17 independent UN rights experts appointed by the Human Rights Council. It works on a voluntary basis.
Members serve in their individual capacities, and are neither employees nor do they receive salaries from the UN.
The group highlighted in particular, trading in areas essential for the enjoyment of human rights of marginalised, indigenous peoples, Afro-descendants and peasant communities.
Also listed are persons with disabilities, older people, persons living with albinism, as well as those living in conflict regions.
The experts also pointed out that so-called “financialisation’’ – the growth in new financial instruments since the 1980s managed by new financial services – had a disproportionate impact on the enjoyment of rights by women and girls.
Women and girls, it pointed out are systematically victims of discrimination.
On adequate housing, a former Special Rapporteur noted that in recent years massive amounts of global capital had been invested in housing as a commodity; as security for financial instruments that were traded on global markets, and as a means of accumulating wealth.
When the 2008 global financial crisis hit, however, many houses suddenly lost much of their value, and individuals and families were made homeless overnight, the rapporteur noted.
The expert also pointed out that in the Global South, informal settlements in southern cities were regularly demolished for luxury housing and commercial development intended for the wealthiest groups of the population.
This process of “financialisation’’ of assets has only been reinforced during the COVID-19 pandemic, the expert said.
In agricultural markets, the experts described how the same big international banks responsible for the global financial crises, invested billions of dollars in food futures.
This, they noted, generated increases in the prices of raw materials such as wheat, corn and soybean, which doubled and even tripled in a few months, creating a new speculative food bubble.
According to the World Bank, between 130 million and 150 million more people were pushed into extreme poverty and hunger, mainly in low-income countries depending on food imports to feed their populations.
The experts highlighted how the “financialisation’’ of housing and food had exacerbated inequalities and exclusion, disproportionately affecting heavily-indebted households and those in low income groups.
Applying speculative logic in these areas violates the human rights of people in poverty, exacerbates gender inequality and aggravates the vulnerability of marginalised communities, they stated.
The growing monetisation and commodification of ecosystem services, such as carbon storage, were also noted by the experts.
They warned that they threatened the sustainability of ecosystems, marginalised natural and cultural values that had no apparent economic value, and weakened the control of indigenous peoples and local communities over their territories.
The right to pollute and destroy nature is gradually being legitimised and commercialised, they also noted.
They pointed out that addressing the climate emergency often ignored both the impacts on people in poverty, and undermined the human rights and livelihoods of the poorest.
The eviction of indigenous peoples from forests or the replacement of complex old-growth forests with monocultures of fast-growing non-native tree species was highlighted as an example of this.
Treating housing, food or the environment as assets to be traded by hedge funds and other financial actors in financial derivatives markets represented a direct attack on peoples’ enjoyment of human rights, the experts submitted.