The issues surrounding hunger mobilize public opinion and debate. It is one of the major challenges of the contemporary world. To meet this challenge, the OECD, in a recent report, extract published here1
, recommends a general increase in income. According to the organization, food insecurity is due more to poverty and lack of income, than food prices. Consequently the OECD recommends the establishment of long-term strategies at national and international levels to achieve such an increase.
These strategies would be based primarily on agricultural development, the role of which is essential to generating the necessary incomes for achieving food security, especially in the poorest countries. Because, internationally, about two-thirds of the poor live in rural areas where agriculture is the dominant sector, says the report. Farming is mainly carried out on small farms, “the priority is to increase their income”, which can be done directly through increased farm incomes, and indirectly through the creation of non-agricultural employment and the diversification of rural economies.
With all due respect to the OECD, if an increase in farm incomes, particularly in developing countries, is an essential step in the fight against world hunger, obscuring the devastating effects of price volatility on global food security would be particularly detrimental. The fight against food insecurity also involves combating agricultural price volatility which has also been exacerbated by the dismantling of public support mechanisms and market regulation in recent decades.
As long as policies do not take into account intrinsic market failure marked by structural price volatility and do not define appropriate mechanisms to ensure a fair income for farmers, the agricultural sector will go from crisis to crisis and poverty and hunger will increase.
momagri Editorial Board
Eliminating hunger and malnutrition, and achieving global food security more widely, is among the most intractable problems humanity faces. While many once poor countries are now developing rapidly, the world as a whole is unlikely to meet the First Millennium Development Goal target of halving, between 1990 and 2015, the proportion of the world’s population who suffer from hunger. According to FAO figures, the total number of undernourished people in developing countries has fallen from just under a billion in 1990-92 to around 852 million in 2010-12. However, the pace of reduction has slowed and the absolute numbers remain stubbornly high.
The problem of hunger has been accentuated by high food prices. In low income countries, food consumption expenditures typically account for 50% or more of households’ budgets. In lower middle income countries, such as China and India, the figure is about 40%. Farmers are affected by food prices as both buyers and sellers. Those with sufficient access to land and other resources may gain from higher prices, but a majority of the rural poor – including many farm households – are net buyers of food staples. Even short episodes of income loss can cause poor households to sell productive assets at low prices, leading to potential poverty traps.
There were legitimate fears that higher food prices could undermine the food security of millions. Recent data suggest that, while many households have faced undeniable hardship, the worst fears have not been realised. The chief reason is that robust income growth in many developing countries has been sufficient to outweigh the impacts of higher food prices. The global picture has been helped by strong growth in populous middle income countries, including China and India, where a large share of the world’s undernourished live.
While prices levels matter, they are not the fundamental problem. The persistence of global hunger – the chief manifestation of food insecurity – is a chronic problem that pre-dates the current period of higher food prices. Indeed there were as many hungry people in the world in the early 2000s, when international food prices were at all-time lows, as there are today.
The principal cause of food insecurity remains poverty and inadequate incomes. Globally, there is enough food available, although many people are too poor to afford it. Tighter world food markets, in which food is less available, make affordability an even bigger constraint. Broad-based income growth is therefore the key to lasting reductions in global hunger. Policies and investments that stimulate income growth are likely to reduce the need for short-term fixes that cope with consequences of low incomes but do not tackle the underlying causes.
Yet there is no need for anyone to be left unprotected. If people are too poor to afford food, then national governments can provide social safety nets and nutrition programs. If governments do not have the required domestic resources, then funding gaps can be met by the international community.
Agricultural development has a key role to play in ensuring food policy
Agricultural development has a key role to play in generating the incomes needed to ensure food security, especially in the poorest economies. Approximately two-thirds of the world’s poor live in rural areas, where agriculture is the dominant sector. Most of the farming is done by smallholders, so raising their incomes is a priority. That can be achieved directly, by raising agricultural incomes, and indirectly by creating non-farm jobs and more diversified rural economies. Government strategies need to support both channels of development.
In a context of higher food prices, there are better opportunities for smallholder farmers to develop commercially viable operations than there have been for many years. Yet, the realization of those opportunities by smallholders will result in others moving out of agriculture into new, ultimately more remunerative, activities. Indeed, it is important to recognize that – as all OECD countries have experienced – the majority of future generations will have better opportunities outside agriculture than within it.
1 Read the entire report by following this link http://www.keepeek.com/Digital-Asset-Management/oecd/agriculture-and-food/global-food-security/executive-summary_9789264195363-3-en#page4