High food prices threaten struggle against poverty | Globalization | DW | 04.05.2012
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High food prices threaten struggle against poverty

The fight against child and maternal mortality is one of the Millennium Goals. But one reason for lack of progress is malnutrition and poor diet - in turn caused by rising global food prices.

Hunger and malnutrition are not only the consequences of poverty but often also the very reason for it. That's the conclusion of the Globla Monitoring Report 2012, released by the World Bank and the International Monetary Fund (IMF). Each year, the report looks into the progress made in implementing the eight Millennium Goals that the United Nations drew up in 2000 - the most important of which was to halve poverty by 2015. The status report in 2012 is sobering: the food crisis and global food price hikes have in fact turned around some of the achievements of the past years.

Food prices had already been on the rise in 2007 and 2008 but, last year, they reached new record highs which, first and foremost, hits the poor, who have less and less money available for food and therefore not only have less but also worse food to eat. In Tanzania, for instance, the number of households that can afford three meals a day has sunk by 20 percent.

Jos Verbeek

Verbeek is one of the main authors of the Global Monitoring Report

This has especially dramatic consequences for infants. "The first 1,000 days are extremely important for the development of a child," says Jos Verbeek of the World Bank and one of the main authors of the Global Monitoring Report. "If a healthy diet is not guaranteed in the first 1,000 days, the child will suffer for the rest of his or her life."

Statistics show that a child suffering from malnutrition enters school around seven months later and is likely to receive a poorer salary - as much as 17 percent less than a well-nourished child. Malnutrition is also the cause of high child mortality among the under-five-year-olds. Pregnant women and young mothers are also seriously affected by poor diet.

Cities hit hardest

High food prices especially affect people - in particular women - living in cities, who cannot grow their own food. The report's estimate suggests that some 105 million people failed to escape poverty because of the 2007/08 price hikes. Another 48 million were stuck in poverty because of rising prices in 2011/12.

Verbeek argues that developing countries have to set up their own programs to help the highly vulnerable against volatile food prices. He cites Brazil and Mexico where the governments have already successfully set up such programs. "Other countries have done nothing of the sort," he warns. "But it is important that they implement such measures as soon as possible."


Malnutrition in the first three years is extremely dangerous for young children

Without the help of the international community these measures are unlikely to succeed, but the Global Monitoring Report criticizes that so far, food security has not been getting enough attention. Only 10 percent of development aid is used for food and agriculture, only three percent are used to sustain even a basic food supply. This has to change, says Natalia Alonso, head of the EU office of NGO Oxfam International. Also, the international community should help developing countries to improve their tax systems and stop tax evasion.

Global trade liberations the answer?

In addition to that, the Global Monitoring Report suggests public investment such as so called REPOs (repurse options). Under that scheme, the government assures farmers that it will purchase food like corn at a fixed rate at a certain date. The farmers also get a reward for stocking their supplies for several months. Should the stock-piled food not be needed after all, the farmers then can sell it at the normal world market price.

The report's authors also pin their hopes on a global trade liberalization. The report argues that a sustainable food supply can only be achieved once domestic markets are not cut off from global trade flows. To make sure that the domestic agriculture sector won't suffer from that, the negotiations at the World Trade Organization ought to resume, says Brad McDonald of the IMF. Some of the proposals on the table are actually in the interests of developing countries, he says. "For instance, the subsidies that farmers in the West receive - and which indeed mess up the global food prices and threaten farmers in poorer countries - could be better regulated if the Doha talks could be wrapped up."

'Markets need regulation'

Natalia Alonso

Alonso insists that markets need more regulation

Natalia Alonso of Oxfam however warnst hat trade and competition alone are not a "magic tool" to fight price fluctuation and global food shortages, because farmers and traders are after all mostly interested in making a profit. "The market does not itself ensure that everybody has food. We need government interventions to strengthen existing potentials." For instance, in sub-Saharan Africa, only 25 percent of the potential output by small farmers is being realized, she explains. "But in order to increase their output, those farmers need access to markets, to infrastructure and services," Alonso says. "And that's why we have to invest more to help small farmers."

The IMF also says there's a need for a certain change of direction. Growth and macroeconomic development remain important for the fight against poverty and hunger but, at the same time, growth has to be accompanied by targeted measures against recession. "We cannot simply aim for growth in the medium term, we also have to learn to tackle and manage short-term fluctuation, the IMF's McDonald said.

Author: Monika Hoegen / ai
Editor: Nicole Goebel

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