Observations on poverty. By Sue Branford

Stacked by the door of a shabby supermarket in the impoverished east of the giant Brazilian city of Sao Paulo was a pile of tins of condensed milk, each bound with a red ribbon, tied in a bow. "Make your mother happy on Mothering Sunday", said the sign, against a picture of a smiling woman with a plate of brigadeiros, the popular dessert made from this sweet, thick milk.

You would never find such an advertisement in a middle-class area of the city; in this campaign Nestle was deliberately targeting the poor, presenting a cheap product as a treat to be bought on a special occasion.

For many years the multinationals ignored the very poor, considering their incomes too small to bother about, but in recent years, with sales stagnant in other market segments, this has changed. Nestle is not the only big corporation to have realised that you can make a handy profit by selling large quantities of cheap goods to the poorest of the poor.

Four billion people, or two-thirds of the world's population, fall into that category, according to C K Prahalad, professor of corporate strategy at the University of Michigan Business School, and as a pool of consumers they are, he says, "the biggest potential market opportunity in the history of commerce". Better still (in commercial terms at least), they are the segment of the global population that is growing most quickly: by 2040 they are expected to total six billion.

The poor, as individuals, may not be able to buy much, but they are avid consumers. They have access to television, watch the adverts and know how the middle classes live. Not surprisingly, they too aspire to that life, if only for a fleeting moment.

In Vietnam, boatmen travel from village to village selling bars of Lifebuoy soap and sachets of Sunsilk shampoo to the local shops. Arijit Ghose, from Unilever Vietnam, recently told Time magazine he had been to villages where there was no electricity or running water but there was Sunsilk and Omo.

For the young, the most seductive of all mass-market products is the mobile phone. Brazil has 81 million young people and an amazing 70 per cent of them, many from very poor families, have mobile phones.

Gilberto Dumas, who has written extensively about poverty and global accumulation, says the mobile satisfies a real emotional need. "Research shows that 15- to 20-year-old Brazilians yearn above everything else to own a car," he says. "As this is way out of their reach, they settle for the number-two item on their wish list - a mobile phone."

All over the world manufacturers are targeting this immense market, their advertising campaigns geared to make youngsters without mobiles feel like outcasts. They expect an extra two billion people to buy mobiles over the next decade.

In developing countries these days, rural filling stations often offer recharging facilities where, for a small fee, people without electricity at home can keep their mobiles alive. In Latin America, store owners rent out mobiles by the minute (often at exorbitant rates) to people too poor to buy their own phones.

What should we make of this? On the one hand it is undoubtedly moving to see an excited young woman who has travelled for days by bus from a smallholding deep in the Amazon forest so that, on reaching the town of Redencao, she can rent a mobile phone. She gets the store owner to take a picture of her and her baby which she sends, in real time, to her mother 3,000 kilometres away in Sao Paulo.

On the other hand, the demand among the poor for products such as Coca-Cola and Levi's is artificially created by the advertising, and absorbs resources needed to satisfy more basic needs.

Prahalad sees in the multinationals' new interest in selling to the poor the germ of what he calls "a market solution to the problem of poverty", and it is true that a few poor farmers are using their mobile phones to get better prices for their agricultural produce.

But this is unusual: generally the poor are buying cheap consumer goods that cannot be used to generate income. The process is feeding capital accumulation and income concentration, not reversing it. It is making the world more unequal, not more equal.

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