Zoellick stresses fight against hunger

from the Financial Times

By Krishna Guha and James Politi in Washington

Robert Zoellick will call on world leaders in Davos this week to make the fight against hunger and malnutrition a global priority following sustained increases in food prices worldwide.

The World Bank president will tell political and business leaders that failure to find ways to help the world’s poor cope with higher food prices could bring about a “loss of hope” that might undermine development strategies.

The Bank president will also warn that the global economic turmoil poses a serious threat to a group of poor countries – mostly in Africa – that are vulnerable to a combination of slowing global growth and high energy and food prices.

These include countries that export non-oil commodities. The price of their exports could fall much more sharply than the price of oil in the event of a US recession.

In an interview with the Financial Times, Mr Zoellick said it was essential that at a time when attention is focused on the world’s biggest economies, global leaders keep “an eye on the needs of the poor countries”.

He said there were many poor countries “including in sub-Saharan Africa that have started to build good fundamentals for growth, but that growth could be threatened by these events”.

Mr Zoellick said the Bank was doing what it could to provide “counter-cyclical” support, including by promoting domestic private sector-led growth in poor countries.

The Bank president said he would try to use the Davos gathering to “draw attention to hunger and malnutrition, the forgotten Millennium Development Goals”.

Fighting malnutrition was essential to success on other development fronts, such as reducing infant mortality, improving maternal health and strengthening primary education, he argued.

Mr Zoellick said he expected food prices – and energy prices – to stay high for a sustained period. He said: “I think biofuels is an element in the overall demand picture.” But he did not single out booming demand for non-fossil fuels as the cause of high food prices, as some development experts have done.

The Bank chief said a big contributor to rising grain prices worldwide was increasing incomes and changing diets in China, India and other large developing countries.

He said many of the poor people hard-pressed by higher food prices were in “very poor countries that have very small margins for manoeuvre” making it essential that there was a “better international response” to the problem.

Mr Zoellick said the Bank believed that, rather than regulate food prices, poor countries should consider making targeted cash transfers to the poorest sections of the population, allowing them to buy basic foodstuffs.

But he said hunger and malnutrition were problems that required a broader set of development initiatives, including efforts to boost agricultural productivity and efforts to speed the transfer of energy-saving technologies to the developing world.