Thursday, October 16, 2008

Lessons to learn from the food crisis

OXFAM has relaesed a new position paper on how the world should react to the global food crisis. The report titled Double Edged Prices has 10 actions that OXFAM would like to see the world take to prevent another food crisis.

Among the 10 steps, are the importance of investing in agriculture, having trade policies that ensure food security, and designing social protection systems that protect the poorest.

Our snippet from OXFAM includes some stats on how many people have been pushed into poverty from the food crisis, and the profits that food manufactures have made since prices went up.

The sharp rise in global food prices has pushed 119m more people into hunger, taking the global total to 967m. Higher food prices mean people are eating less and lower quality food, children are being taken out of school and farmers are being forced to migrate to cities to live in slums (see case studies below). Women are especially vulnerable because they rarely own land and have limited access to credit and other services, but they bear much of the responsibility for feeding and caring for families.

Meanwhile, some of the biggest international food companies have made windfall profits. Commodity-trader, Bunge, saw its profits in the second fiscal quarter of 2008 increase by $583m, or quadruple, compared with the same period last year. NestlĂ©’s global sales grew nearly 9% in the first half of 2008, and UK supermarket Tesco, has reported profits up 10% from last year. Seed company, Monsanto, reported a 26% increase in revenue to a record $3.6bn in the fiscal quarter that ended May 31, 2008.

Oxfam criticizes the international community’s inadequate response – both in terms of money and coordination. At an emergency meeting in Rome earlier this year, $12.3bn was pledged for the food crisis, but little more than $1bn has been disbursed so far. This is in stark contrast with the response to the current financial crisis, where huge financial resources have been mobilized by the international community in a matter of days.

OXFAM also provided some case studies that show how their suggestions are working in specific countries.

In Haiti, existing deep poverty has been exacerbated by food price rises and hurricanes. Five million Haitians live on less than a dollar a day and in 2007 almost half the population was undernourished. Haitians have labelled the food price crisis Clorox after a brand of chlorine tablets for water purification, which cause terrible stomach pains if swallowed – like permanent hunger.

In Malawi, government subsidies have successfully boosted production levels in many areas, resulting in consecutive surpluses at the national level (a reversal of previous shortages). However, pockets of serious food insecurity still exist and some poor households are already facing a food crisis, eating only one meal a day. In some areas, women have resorted to cooking wild beans, which are poisonous if not prepared properly. This means cooking them for hours, using scarce water and firewood.

In Cambodia, soaring food prices are impacting hard on the poor in both urban and rural areas. Even rice farmers who are supposed to benefit from the high prices are struggling to feed their family, as many of them are net food buyers. Overall, 1.7 million people are facing food insecurity. Von Siphou, 42, sells fruit at a stall in Phnom Penh. She says: "I am working as hard as I can and it is not good enough. The only thing left to do is to not eat."

In Honduras, which is highly dependent on imports, food consumption among the poorest families has reduced by 8%. The most affected are urban poor, subsistence farmers, day labourers, and non-farming rural poor. 60% of the rural population is affected.

In Tajikistan, an exceptionally severe winter followed by a hot spring led to large losses of livestock and crops. Locusts in the south also destroyed crops. One third of the rural population is now food insecure (at least 1.7 million people).

In Brazil, well-targeted government agricultural policies have shielded small farmers and consumers from the harshest impacts. The urban poor, among others, are however, still feeling the effects of higher prices.

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