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Key Remarks on the FAO High-Level Expert Forum “How to Feed the World in 2050”
“Fighting farmers’ poverty will immediately resolve a large part of global poverty”
This past October 12 and 13, the FAO brought together approximately 400 experts from around the world with a view toward outlining feasible solutions to eradicate hunger by 2050. The goal was to prepare a summary document for the World Summit of Heads of State and Governments on Food Security to be held in Rome on November 16, 17 and 18, 2009.
Several scant shared analyses are emerging and it is interesting to observe a slow but manifest evolution of the dominant ideology. The next level to be reached must be that of a clean break with implemented policies.
The wind is shifting, especially concerning the Doha Talks that, auspiciously, are no longer seen as the only solution... Far from it.
What can we take away from the Forum’s two days? Beyond the highly interesting debates on the various paths to stimulate private and public investment, facts on available agricultural resources, challenges presented by global warming and technological concerns, momagri noticed several key ideas that deserve to be mulled over:
|1. “We have entered a new paradigm: Agriculture must be at the heart of economic development policies”; |
2. “We are at loose ends in the face of the relentless rise of poverty, the food crisis and the volatility of prices”;
3. “Hunger is first and foremost an issue of income and prices”;
4. “We must recognize our inability to plan ahead: The biggest mistake would be to believe that we already know how to do it”; “Recent events have shown that markets behave imperfectly”;
5. “We must lessen risks without delay to initiate the foundations of genuine agricultural development and, consequently, a decline of poverty and hunger”.
These five concepts were pointed out during the two-day conference.
While momagri is very pleased about statements of intent for a general mobilization to fight the plight of hunger, it nevertheless regrets that the discussions did not get to the heart of the matter concerning the need for regulation––a term that was barely touched upon.
1. In the Forum keynote address, Alain de Janvry, Professor of Agricultural and Resource Economics at the University of California at Berkeley, stated that we have entered into a “new paradigm”. According to the official definition, it means that the international community must now look into new issues and design new methods to resolve them. To that end, “it is imperative to develop expertise, work with new talents and make use of new approaches1 » .
momagri praises the fact that such position finally is taken in an international arena, while it can but deplore the time lost up to now. Since 2005, momagri has been sharing the same thoughts to provide political leaders, as well as the agricultural and scientific communities, with new decision-making tools that are better tailored to the reality of agricultural markets.
2. SFollowing a presentation on the expectations regarding hunger and poverty, most experts claim to be at loose ends. Three figures must be kept in mind:
- 1.2 billion people currently suffer from chronic hunger, that is to say more than one out of six persons! 3. Mamadou Cissokho, Honorary President of the Network of West African Farmer and Producer Organizations, repeatedly called the attention of the participants to remind them “hunger is a poverty issue that is directly tied to farmers’ poverty.”.
- Close to 2 billion people suffer from malnutrition;
- In total, close to 40 percent of the world population live in a critical state of poverty and malnourishment.
Josef Schmidhuber, Senior Economist at the FAO, confirmed it: Rural areas generate 75 percent of global poverty. Likewise, Professor Marcel Mazoyer has been leading such a fight for years: “Fighting farmers’ poverty will immediately resolve a large part of global poverty”..
“Hunger is first and foremost an issue of income” summed up Csaba Csaki, Professor of Economics, at the Corvinius University in Hungary, and we must act upon this variable factor.
This is why momagri considers that, as long as policies do not outline mechanisms to ensure fair revenues to farmers, agriculture will be confronted to a succession of crises, and poverty as well as hunger will increase. We must turn our backs on this ideological rationale to adopt a genuine policy of regulation.
A professor at the American University in Cairo a même proposé de even recommended re-examining the notion of « fair price » eby pointing out that « the price-fixing system represents the core of the problem. » momagri is working in that direction to identify, by large homogenous geographical development zones, “equilibrium prices for farmers and baseline prices for consumers” that could constitute the linchpin of regulation policies.
Throughout the Forum, the countless causes of the non-development of agriculture in poor countries were scrutinized: Issues related to land ownership, investment, infrastructures, irrigation, education, healthcare, even corruption sometimes…
These problems must indeed be resolved, but only in a political framework that stabilizes the macro-economic environment and investment; Otherwise the efforts carried out may not lead to the expected results.
Several arguments were raised to condemn the detrimental effects of unfettered regulation policies on the spread of global poverty and the weakening of food security. Robert Paarleberg, Professor of Political Science at Wellesley College in Massachusetts, thus questioned the line of reasoning that the WTO could still apply to convince Governments of the legitimacy of the Doha Talks methods! He also asserted that poorer countries that lowered trade barriers were facing worse situations than before. He did not receive any answer… The agricultural price volatility, which was exposed by momagri as early as 2005 as one of the major causes of farmers’ problems, was also blamed. According to a poll taken onsite during the Forum, 85 percent of experts are now convinced that agricultural prices will remain volatile in the future, thus belying the latest OECD agricultural estimates2.
4. The emergence of such consensus on volatility is regrettably slow in the economist community for a very simple reason, which was barely broached in Rome by Alain de Janvry: The inability to plan ahead and the imperfections of agricultural markets. The failures of economic tools are indeed implicated.
Yet, so that economic and political thinking can progress, models must better reflect the reality of agricultural market operations. Professor Bertrand Munier, Chief Economist at momagri, directed his studies to that objective as early as 2006. As a result, he achieved the modelization of agricultural price volatility by incorporating, among other elements, endogenous risks (farmers’ expectations as well as speculation) in the momagri economic model.
There lies the core of the problem: In order to develop efficient policies, one must have tools and indicators that are better tailored to economic situations and, most importantly, to the recognition of risks in our environment.
5. Europe, the United States and many other nations have understood that agriculture is a specific field that needs policies based on lessening the risks faced by farmers, and, by doing so, foster farmers’ expansion. All participants of the Forum’s Panel #1, from Kitty Smith, Administrator at the Economic Research Service of the US Department of Agriculture, to Homi Kharas, Senior Fellow at the Brookings Institution, acknowledged that markets alone could not manage uncertainty. We need mechanisms to regulate price volatility, which threatens farmers on one hand and, on the other, generate risks of soaring prices for consumers.
According to Hafez Ghanem, Assistant Director-General for FAO’s Economic and Social Development Department, this also represents the foremost conclusion to be gained from the Forum: Risk and uncertainty are currently the two major parameters to be considered.
We are pleased that these realities are ultimately laying the bases for in-depth examination. As early as last June3 : he economists participating to the momagri workshop also came to such consensus: “The financial and food crises have brutally reminded us of one major fact that has been neglected for many years: that risks and uncertainty are at the heart of how markets function, especially the agricultural ones. And, as Edi Karni, Professor of Economics at Johns Hopkins University in Baltimore, underlined, the players in these markets, like most experts, often forget that they do not know that they do not know.”
However, most economists still object to the notion of regulation by pleading that such action would prevent markets from operating correctly. Yet, it is the opposite. Because markets are malfunctioning, we must implement regulatory mechanisms. More and more countries are now convinced of this and the scientific community must now achieve its own revolution.
Let us hope that the up-coming Summit of Heads of State and Governments will not steer clear of these crucial issues for the future of global food security and will embark on an intellectual revolution to initiate a system of global governance for agriculture and food.
1 “Key issue is expertise, new talents have been to put forwards, we have to work with new approaches”
2 Agricultural Outlook 2009-2018.
3 Please see our June 8, 2009 article “We need a revolution in our understanding of how agricultural markets operate” by Paul-Florent Montfort, analyst at momagri www.momagri.org/UK/Points-of-view/We-need-a-revolution-in-our-understanding-of-how-agricultural-markets-operate-_509.html