A vicious circle of misery

from The Toronto Star

As the price of basic staples soars and global aid reaches the breaking point, chronic hunger will become the norm

Olivia Ward
Foreign Affairs Reporter

In El Salvador's markets, the buzz of bargaining once echoed in the narrow streets as ordinary people tried to stretch their meagre budgets and fill their families' stomachs for another day.

Now, anger and silence have overtaken the marketplace, as the price of the most basic staples – rice, corn, flour, beans – has rocketed out of reach, and those who once barely stood their ground are falling through the floor of poverty to its basement: dependence on handouts from international donors.

"People are stunned. And it's not just the poor and hungry buyers. It's the small merchants themselves," says Trevor Rowe, a World Food Program spokesperson for Latin America.

"They're bearing the brunt of the consumers' complaints, and they have a hard time justifying the high costs. It's a brutal situation for everyone. In the rural part of the country the calorie intake was already low. Now people are plunged into chronic hunger."

El Salvador is not alone. Throughout the world, the working poor, and even the middle class, have been pushed into poverty by soaring food costs. International aid organizations and charities are faced with a crisis that is unprecedented in the last half century.

The WFP, which provides more than half of all global food aid, has made a historic "extraordinary" appeal for $500 million to fill a budget gap that has now grown to $750 million as food costs swell. So far, only half of the $500 million has arrived, some of it in pledges that may take months to collect.

The Rome-based agency has set a deadline of May 1 to consider life-and-death choices affecting the planet's poorest people: a caseload of 73 million in more than 80 countries.

"We are hopeful that we will be able to make up enough of the gap to keep us on a somewhat even keel," says Jennifer Parmelee, the agency's public affairs officer in Washington. "But if we don't, we face the very heartbreaking choice of making cuts in rations, or cutting the number of people (we feed) across the board."

Even the $750 million shortfall is burgeoning alarmingly, Parmelee points out.

"This isn't a photograph, it's a movie. Every frame is moving along as we speak. This is not the tsunami, where we could calculate to meet the needs. We are in a new situation, where we had to make an appeal on a global level that we have never done before."

Salvadoran President Elias Antonio Saca declares it a "perfect storm" that "might become a hurricane that could upset not only our economies but the stability of our countries."

His words reflect frustration over the complex causes of the price spikes, from historic lows in food stocks aggravated by global warming to higher consumption of meat and dairy products in emerging economies, to escalating energy costs, profiteering and increased production of biofuels that feed vehicles rather than people.

With food riots spreading from Haiti to Egypt, Yemen, Cameroon, Thailand, the Philippines, Uzbekistan and beyond, the link between food security and world security has never been stronger. The "six degrees of separation" between rich and poor countries are rapidly shrinking.

Increasingly, the responsibility for warding off the starvation that could trigger massive global unrest falls on the shoulders of aid providers and their donors.

For countries like El Salvador, where money buys 50 per cent less food than it did last year – and before the price spike, many were already spending more than half their incomes on food – aid is especially urgent. Agencies are only beginning to lengthen the list of destitute people who are dependent on their help.

"In Salvador the poor used to survive on rice, and beans, and perhaps a tortilla," says Rowe. "They would add the occasional piece of meat or chicken." Now, he says, "it's coming down to rice."

And less of it.

Once the fallback food of the poorest, rice is becoming unaffordable in quantities that sustain life for the most destitute. Since last January its price has leapt by 80 per cent on world markets.

The humble foodstuff almost seems targeted by a malevolent agri-god. In Australia, drought has almost halted the largest rice mill in the southern hemisphere. In North Korea, a third of the crop was decimated by floods. In the Philippines, higher fuel and fertilizer costs have escalated prices so much the government staged a dramatic crackdown on rice theft.

The upward surge in price may not last, experts say, but there's little chance of a return to the days of cheap and available rice supplies.

"We will hit a peak, and it will drop pretty quickly, but not anywhere near $300 a tonne," Robert Zeigler, head of the Philippines-based International Rice Research Institute, told Reuters. The current price is about $1,300 a tonne.

As a result, donor countries and aid agencies are wrestling with some of the toughest policy decisions in recent memory.

"There are short- and long-term things we can do to help," says Katarina Wahlberg, social and economic policy co-ordinator for New York-based Global Policy Forum.

In the short term, she says, wealthy donor countries have to increase their contributions to WFP and other aid agencies. In 2007, Canada donated about $161 million of the agency's $2.9 billion budget.

And, Wahlberg adds, donors should begin to curtail domestic subsidies for producing biofuel, which dampen incentive for growing food crops. In the long term, they must take a hard look at the side effects of globalization that make the poorest countries dependent on imported food, she says. "Small-scale farmers should be producing for local markets."