January 20, 2009
Nourish the Hungry
Greenwire reported on the Madrid meeting next week that will be examining progress on addressing the worldwide food crisis -- where one of every seven people in the world is hungry. What a wonderful time to begin to make a difference! Although the crisis in food prices that fueled the Rome discussions last summer has abated, the long-term problem remains. And, if the Administration is swift and sure-footed enough, President Obama can use the discussions in Madrid to signal that the United States is serious about fulfilling his inaugeral promises:
UNITED NATIONS -- One of President Barack Obama's first forays into into multilateral diplomacy will be following up on a food crisis that engulfed the world's poorest countries last year. Though food prices have fallen sharply in recent months, diplomats will gather Monday in Madrid to see whether they are keeping their promises of food aid and support for agricultural development made at U.N. Food and Agriculture Organization (FAO) talks in Rome last June. "The Madrid meeting will raise the political profile of food security," said David Nabarro, coordinator of a U.N. task force established last year by Secretary-General Ban Ki-moon to address the crisis. "The food systems of the world have been in crisis, continue to be in crisis and will go on being in crisis until we're able to create a situation where they work in the interests of poor people."
U.N. officials estimate that about 1 billion people are undernourished and at least 100 million would face imminent starvation were it not for emergency food assistance. Last year, record oil prices, burgeoning demand for food, and failing crops contributed to a upward spiral in the price of most food basics, especially rice, wheat and corn.
U.S. farm income rose by about 50 percent during the boom, but most of the world suffered. Food prices have since plunged, but Nabarro told reporters here yesterday that food commodities are still much more expensive than they were in decades past. And officials fear that under-investment in agriculture expected during the current market slump is only setting the stage for greater problems down the road. "The food crisis is not the story that's on the tip of everybody's tongue right now. It's the financial crisis," said J.B. Reed of the nonprofit Nuru Project, which staged a New York photography exhibit last month showing images of starving people and Third World food riots. "But the financial crisis has implications for the food crisis."
Average food prices more than doubled worldwide over three years. Farm subsidies in wealthy countries, the popularity of biofuels and market speculators were among the culprits blamed. But a long neglect of the importance of Third World agricultural productivity by organizations like the World Bank, the International Monetary Fund and the U.S. Agency for International Development contributed greatly. For 20 years, aid efforts have focused mostly on industrial infrastructure, figuring the developing world could simply import cheap food grown efficiently in the West. Agriculture enjoyed about 20 percent of international aid dollars back in the late 1980s, but skewed priorities have shrunk its share to just barely 3 percent today. FAO estimates that by mid-2008 food prices were 64 percent higher than 2002 levels. The only other time prices shot up so quickly was in the wake of the oil shock of the 1970s.
In total, governments pledged about $6.6 billion in new spending on food aid and agriculture programs in Rome last year. The lion's share of commitments came from Washington, which pledged to spend $5 billion over the next two years. Since then, the global financial crisis has diverted hundreds of billions of dollars in government resources to shoring up banks and protecting deposits. Meanwhile, collapsed commodity prices and rising food stocks have largely eliminated any sense of urgency. "Actually, most countries that pledged in Rome have followed up, but the follow-up has been a lot slower than we would like," Nabarro said. "One of the things we will be doing in Madrid is tracking that follow-up." Experts who have stayed focused on food security issues worry that the financial crisis will affect future food production more than many appreciate. Falling prices and weaker demand mean farmers in developed countries have little incentive to grow more this year. And the tight credit environment makes it difficult for farmers to finance expanded yields even if they wanted to....
U.N. leaders have said that between $20 billion and $40 billion in new annual spending on agriculture is needed over the next several years to keep up with population growth and expanding demand as nations like India and China grow richer. Nabarro said he hopes at least some new commitments for additional spending will materialize in Madrid, with the new Obama administration playing a lead role. "We take a view that in a world where 14 percent of the population remains hungry ... that is an extremely unsatisfactory situation," Nabarro said. "That is a representation of a crisis."
Lower food costs give public policymakers some breathing room as they focus on halting the decline in the global economy, which began in the developed world but is now hitting developing countries hard, as well. Agricultural economists predict that prices for most food commodities will stay low for much or all of 2009. "World production of wheat, maize and rice is expected to exceed demand and contribute to a partial replenishment of stocks," experts with the U.N. Department of Economic and Social Affairs say in their latest global economic outlook. But economists warn that once the financial system recovers, so will food markets. And price declines over the last few months still don't make up for much of the increases experienced over three years. The World Food Programme's budget for 2009 is estimated at $5.2 billion, a record....
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