By Aileen Kwa GENEVA - The high food prices that have sparked riots in parts of
the developing world from Indonesia, India and Bangladesh to Cameroon, Ivory
Coast and Haiti should come as no surprise. They are only the latest in a
series of events many developing countries have suffered as a result of opening
their borders and neglecting domestic agriculture.
A large number of developing countries have conscientiously implemented World
Bank and International Monetary Fund (IMF) conditions and World Trade
Organization (WTO) commitments. They have applied the given structural
adjustment policies and
have seen the damaging consequences to their domestic agricultural sector. The
consequence has been the certain erosion of their capacity to produce their own
food.
In the era of stronger state control in the 1970s and early 1980s, domestic
food markets in the developing world were often in the hands of state marketing
boards and cooperatives. Marketing boards would guarantee floor prices and
provide fertilizers and seeds. They also controlled import volumes,
redistributed food where there were production shortfalls, and purchased
commodities from cooperatives.
These marketing boards were not always run in the best possible way; there were
many instances of corruption or inefficiency, but they did fulfill certain
critical functions. Farmers were provided a market to which to sell their
produce, which meant they had a livelihood. Prices were stable even though they
were often lower than what farmers would have liked.
As a result of these policies, many developing countries were either net food
exporters, or at least were nearly food self-sufficient.
All that has changed over the past 20 years. Investment support to farmers was
done away with. Small farmers were told to produce for the international
market, and their markets were opened to producers from outside. Rather than
supporting staple crops, government support went to the export sector. Since
all would specialize in the products where they had "comparative advantage",
gains were supposed to accrue all round.
But rather than producing winners, millions of the poorest subsistence farmers
were knocked out of their own markets. Imports took over what was previously
produced by local people. Over the past 20 years, the production capacity in
many countries has severely diminished.
The Philippines has been one prime example of such policies. "During the '60s
and '70s, we were self-sufficient," Jowen Berber of Centro Saka, an
non-governmental organization (NGO)working on agrarian issues with farmers,
told Inter Press Service. "That was the time that the government was heavily
investing in rice - irrigation, infrastructure, marketing support and
production support such as credits and inputs. But when the government stopped
those incentives and subsidies, rice production slowly decreased."
Berber said "the acreage of irrigated land has also been falling because the
government has not been maintaining irrigation facilities. We also have a very
high level of post-harvest losses in rice - up to 35% because our post-harvest
facilities are very old."
Instead of supporting farmers with guaranteed prices as before, Berber said
"the government now intervenes to buy less than 1% of the domestic rice that is
produced. They are buying more imported rice than our own local rice."
A study on import surges by David Pingpoh and Joean Senahoun, commissioned by
the UN's Food and Agriculture Organization (FAO) in 2006, noted that the
Cameroon government support to the rice sector was removed in 1994 through
implementation of IMF and World Bank policies. The fertilizer market was
privatized. Rice yields of poor farmers dropped as fertilizers became
unaffordable. Tariffs were liberalized, and annual rice imports doubled from
152,000 tonnes to 301,000 tonnes between 1999 and 2004.
This opening rendered the country vulnerable to the policies of other
countries. At the time, India was de-stocking its rice surplus, and rice sales
to the Philippines from India jumped to 60,300 tonnes in 2002 from 7,900 tonnes
in 2001. As a result of this import surge, rice farmers were hard hit and many
left the sector. Land for rice cultivation dropped 31.2% between 1999 and 2004.
According to the FAO, the Ivory Coast also saw imports flooding in when the
market was opened up. As a result of implementing commitments at the WTO, the
Ivory Coast removed import restrictions on key agricultural goods, particularly
rice. Duty on all agricultural products was set at a maximum of 15%, except for
25 tariff lines.
As a result, rice imports increased at an annual rate of 6% from 470,000 tonnes
to 715,000 tonnes between 1997 and 2004. Imports were mainly from Thailand,
China and India. Domestic production dropped 40% over this period.
In Nepal, the civil society organization ActionAid documents that rice import
surges came in 1994, 1996 and 2000, with imports increasing by 175%, 55% and
800% respectively. From 24,500 tonnes imported in 1999, by the year 2000
imports had hit 195,000 tonnes. The porous borders between Nepal and India, and
the Nepal-India Trade Treaty were widely seen as the cause of these surges. In
certain areas of Nepal, domestic prices fell by nearly 20%. The southern belt
bordering India saw a multitude of rice plants and rice mills shutting down.
Today, in the latest twist of events, food prices have increased due to global
shortfalls. Food production has been redirected towards biofuel production.
Drought in Australia has contributed to shortages on the world market.
Speculators playing on commodity markets have further increased prices.
Up to 37 countries have been gripped by protests and riots. In Cameroon, seven
people were killed in the unrest in February. Food riots also took hold of
Abidjan in the Cote d'Ivoire in March this year.
At meetings in Berne in Switzerland to address the global food crisis, UN
secretary general Ban Ki-moon, World Bank president Robert Zoellick and WTO
director general Pascal Lamy again made a plea for more free trade the panacea.
But farmers remain unconvinced that more of the same policies that have
contributed to the last two decades of destruction of agriculture can help.
Reacting to the push by the WTO leadership, the World Bank and the UN to stitch
up the Doha Round so that further liberalization can assist in resolving the
food crisis, Henri Saragih, international coordinator of the global network of
peasant farmers La Via Campesina writes, "Protecting food has become a crime
under free trade rules. Protectionism has become a dirty word. Meanwhile,
countries have become addicted to cheap food imports, and now that prices are
shooting up, hunger is raising its ugly head."
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