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International | Food prices and protest

Taking the strain


Posted: 2008-05-12 21:32:27+05:30 IST
Updated: May 12, 2008 at 2132 hrs IST

real discontent with the FAO. An independent evaluation last year damned it for its “heavy and costly bureaucracy”. Merging all three Rome-based agencies (the WFP is there, too) would probably reduce management costs and turf warfare. But it could also stir up a hornets’ nest of discontent, and it is not clear that bureaucratic infighting would make the world’s response to higher food prices any more coherent.

To be fair, rich countries are already managing to be fairly incoherent without any UN infighting. The hope, at least among economists, was that higher prices would induce rich countries to cut state aid to farmers and—says Paul Collier, a development expert at Oxford University—“lead people to question their pleasant fantasies about GM [genetically-modified] food in Europe and biofuels in America.” So far, there are few signs of that.

True, a group of Republican senators has proposed easing legal requirements to increase the amount of ethanol used in fuel. The British government says it will be “selective” in supporting biofuels. But policy changes are thin on the ground. The current American farm bill proposes only modest cuts in ethanol subsidies. The EU has not changed its biofuels target (10% of all fuel by 2020); it continues to bully developing countries not to plant GM crops and last week refused permission to grow varieties of GM maize and GM potatoes in Europe, passing the products along to the EU’s food standards agency for more tests.

While donors squabble, poor countries face riots. But so far, these have had less political impact than many expected. Around 30 countries have suffered protests but only Haiti has seen its government fall. In the Middle East, the part of the world most dependent on food imports, there have been demonstrations and strikes in Egypt, Morocco and Jordan. But all three countries withstood more serious food riots in the late 1970s and 1980s.

In some of the poorest countries, rising food prices have been causing less distress than might have been expected because benefits have also appeared. In Bangladesh, one of the most vulnerable countries, the rice crop is up 10%, prices are about four times production costs and wages for landless peasants are soaring.

Bangladesh has a lot of rural poverty. In countries with millions of urban poor, governments have so far survived demonstrations in part because they are seen to be reacting, whether by issuing ration cards (Egypt and...

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