Who controls the economy?

Writer: Mitta Xinindlu

Image: Unsplash

Economics classes has given us a perfect idea of how the world operates in terms of business. However, without even classes, it is easy to draw from logic using simple daily activities such as buying bread from a local bakery. From this, one can observe that should the buyer stops buying bread and decides to change diet, the bakery will shut down due to lack of customers. 

However, if we give a closer look at the market, we can notice that only a few companies hold a large stake of the economy, thus those who control it. Taking the South African economy, for example, (also using the bread supply chain), one can track the control of the chain to only four companies: Albany, Sasko, Sunbake and Blue Ribbon.

These brands are owned, in their respective order, by Tiger Brands, Pioneers, Foodcorp, and Premier Foods. 

Why in a country that has the land, natural production capacity of wheat, and human resources be in control of only four companies?

This can allude to the fact that the economy is not flowing freely, but controlled by a few.

” According to the commission South Africa’s four largest milling companies collectively controlling over 90 percent of the local flour market were involved in colluding with each other. The four firms (Premier Foods, Tiger BrandsFoodcorp and Pioneer Foods facilitated their pricing activities through secret meetings and telephone calls between employees of these firms at various venues, including churches, stadiums and hotels. The commission found that these price-fixing activities had a negative effect on both consumers as a whole as well as preventing smaller bakeries from being effective competitors. “

Quoted information extracted from Wikipedia.