A Billion Hungry People – remember the food price crisis?

January 26, 2009

     By Duncan Green     

Read this paragraph: ‘Despite the recent creation of a United Nations High Level Task Force, there is still little coordination or collaboration among UN organisations, the World Bank/International Monetary Fund (IMF) and other donors. There is no functioning global mechanism to ensure coordination and policy coherence of the various actors, thus adding complexity to the response effort and reducing efficiency, particularly at country level. Reform of this ‘global architecture’ is pressing.’

Global financial crisis, right? Wrong – it’s about food, from a new Oxfam paper, ‘A Billion Hungry People’, published today to coincide with the latest meeting of that UN Task Force (on the food crisis), in Madrid.

Soaring food prices and rising hunger dominated development debates until the spotlight moved to the economic meltdown in the second half of last year. Countries and poor people were caught in a multiple crunch of energy and water shortages, rising food prices and increasingly unreliable weather. They still are – food prices have fallen back, but are still higher than at the onset of the crunch (see graph). The billion hungry people are still hungry, and now the global financial crisis is hitting developing country governments, jobs and economies.

Stand back a bit and the food price crisis illustrates three wider issues:

1. Volatility and ‘shocks’ are often as important (and damaging) for poor people and development as absolute levels of income or access, and the global economy is going through a period of multiple volatility – of exchange rates, prices, weather.

2. It’s time to re-regulate after 30 years of state withdrawal and laissez faire: Although earlier state institutions, such as grain marketing boards, were costly and often poorly managed, their elimination or privatisation has generally increased vulnerability of chronically poor communities.

3. Shocks are often harbingers of change: they highlight the weaknesses of existing institutions and policies, and galvanize both leaders and public demands for reform. Hence the importance of the Madrid meeting – the danger is that last year’s momentum will be lost as the political caravan moves on to the global meltdown, and the chance to sort out the global food system will be missed.

What needs to happen? Read the paper for detailed recommendations, but in a nutshell: better hunger early warning systems; social protection; food reserves; risk reduction; an enabling environment for private sector and citizens (e.g. via access to credit and insurance); end counterproductive rich country programmes such as biofuels subsidies, and give more and better aid.