A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

The 2016 OECD Report on Monitoring and Evaluation of Agricultural Policy: A denial of reality?

June 20, 2016

Among the seasonal papers released at the close of the first semester, it is common practice to await the publication of the OECD report on the evaluation of agricultural policies. As it reviews national agricultural policies, the report gives constantly rich contents on the range of instruments used by various countries to support their farmers, safeguard their food and sustainably manage the natural resources involved in agricultural production. But––and here is the rub––the conclusions and recommendations are always the same, year in, year out, even when the proposed indicators, which are sometimes very debatable, move in the opposite direction from the OECD existing standard.

Three trends must be noted. First, while the OECD strongly forbids aid that “distort” markets––such as market support and coupled incentives––such type of aid continues to account for the lion’s share of budgets and agricultural support systems. “Together the countries surveyed in the report provided an annual average of $585 billion (€469 billion) in direct support to agricultural producers in the years 2013-2015, and spent an additional $87 billion (€69 billion) on services of general interest supporting the sector. (…) For the 50 nations covered in the report, an average of 68 percent of support is linked to market price support, to payments based on production or on the unconstrained use of inputs.1

Secondly, at a time when the decline of government support in developing countries would allow advancing free trade conditions, which are supposedly beneficial to developing countries, it is on the contrary in developing countries that government support to agriculture is experiencing the most rapid growth: “At the same time, average support levels in the emerging economies have increased from very low or even negative level to approach the OECD average.

Thirdly, the OECD expresses its satisfaction: “For OECD countries as a whole, support has roughly halved over the past 30 years and now amounts to 17 percent of gross farm receipts.” Bearing in mind that this ratio is based on the (high) prices of the past few years, and that it is precisely in times of economic downturn that farmers most need support––as it is currently the case––we might observe a distinct degradation of this controversial ratio.

Thus, if there is indeed a reality that is unwillingly confirmed by the OECD in its report, it is the fact that agricultural support has now become a strategic priority, especially for emerging economies, whether it is to fight the instability and volatility of agricultural markets or in the name of economic development and food security. However, we are still not witnessing a review of the OECD dogma, which keeps taking for granted the virtues of the market to achieve the balance between supply and demand, and which considers all incentives for production as damaging “distortions”. Getting out of a denial of reality and considering that government must correct the numerous “flaws” affecting agricultural markets seems required to lay the foundations of a genuine cooperation between nations and their agricultural policies. Cooperation, as in the “C” in OECD.

1 http://www.keepeek.com/Digital-Asset-Management/oecd/agriculture-and-food/agricultural-policy-monitoring-(...)

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