Resolving the Food Crisis: Assessing Global Policy Reforms Since 2007

1. Resolving the Food Crisis:Assessing Global Policy Reforms Since 2007 Timothy A. WiseGlobal Development and Environment InstituteTufts University

2. Policy Report • by • Timothy A. Wise • Sophia Murphy • January 2012 • Published by: • Institute for Agriculture and • Trade Policy (IATP) • Tufts University’s • Global Development and Environment Institute (GDAE) Available at: http://www.ase.tufts.edu/gdae/policy_research/resolving_food_crisis.html

3. Assessing Global Policy Reforms Since 2007 • Research question: What has truly changed in policy and practice since 2007 price spikes? • Assessed progress in five institutions: • International Donors • World Bank and Multilateral Development Banks • United Nations (FAO, Committee on Food Security) • G-20 Countries • UN Special Rapporteur on the Right to Food • Main conclusions: • Progress in funding, some policy priorities, but… • Key reforms still urgently needed • Underlying causes of food crisis not yet addressed

6. Challenged Neoliberal Assumptions • Even with growing global population, we have the land and technology to feed everyone. • The market will allocate resources most efficiently. • State involvement will only distort those market efficiencies. • Small-scale farmers are outmoded, unimportant, an anachronism. • No need for a country to grow its own food – you can just trade for it.

7. LDC’s Soaring Food Import Bills

8. Declining Growth in Agricultural R&D, 1976-2000

10. Some new wine, in mostly old bottles: • Only $6.1 b of $22 b L’Aquila pledges represent new money, over three years • Barely returns to levels of early 1990s • Austerity budgets threaten even those gains

11. Progress, but inadequate to crisis • Encouraging signs: • Growing commitment to Agric and Rural Development • Recognition that smallholders and women are important • Respect for “country-led programs”, less top-down, e.g. CAADP, GAFSP • Acceptance of strong state role in agric development • Acknowledgment of resource constraints, climate change • But problematic policies persist: • Heavy reliance on market-based solutions • Bias toward private capital, “public-private partnerships” • Bias toward external technologies, high-input agriculture; • Limited priority to domestic food production • Little concrete action on climate change, esp. adaptation

12. Structural Changes: • Integration of: • food • fuel • finance

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14. Financial Speculation Fuels Market Distortions

15. Three Priorities for Urgent Action • Slow biofuel expansion, especially in crops that contribute to underlying rise in demand, e.g. corn ethanol.

16. Three Priorities for Urgent Action • Slow biofuel expansion, especially in crops that contribute to underlying rise in demand, e.g. corn ethanol. • Address volatility: • Strong regulations to limit financial speculation – market transparency, position limits, margins, and more • Active development of publicly held food reserves, not just for emergency humanitarian uses, but as buffer stocks.

17. New England Complex Systems Institute

18. Three Priorities for Urgent Action • Slow biofuel expansion, especially in crops that contribute to underlying rise in demand, e.g. corn ethanol. • Address volatility: • Strong regulations to limit financial speculation – market transparency, position limits, margins, and more • Active development of publicly held food reserves, not just for emergency humanitarian uses, but as buffer stocks. • Moratoria on “land grabs:” • 227 million hectares since 2001 • $91 billion in 2008 alone, dwarfing ODA to agriculture • “development in reverse” – land banking, displacement • Guidelines for “responsible agricultural investment” too little and much too late to address urgency of problem

19. Policy Space for Developing Countries African Union response to G-20: “African countries are not looking forward to depending continuously on external supplies that will remain uncertain in prices and quantities. Actually, our ultimate and unquestionable ambition is to develop our agriculture and markets…. In our opinion, we must rely on our own production to meet our food needs. In fact, importation is not Africa’s goal.” Challenge to developing countries: Taking advantage of the policy space.

20. UN Special Rapporteur on the Right to Food • Olivier de Schutter’s priorities for policy-makers: • Support countries’ ability to feed themselves. • Establish food reserves. • Regulate financial speculation. • Ensure national social safety nets against declining export revenues and rising food import bills. • Support farmers’ organizations. • Protect access to land, putting a moratorium on large-scale foreign land purchases. • Promote the transition to environmentally sustainable agriculture. • Defend the human right to food.

21. Thank you.

22. Weaknesses in Global Response to Crisis • Need more decisive action on key issues: • Funding for Agri. Rural Development • Curbing Food Price Increases and Reducing Volatility • Reducing the Impact of Energy Crops on Food Prices • Stopping “Land Grabs” and Promoting “Responsible Agricultural Investment” • Promoting a Transition to Agro-Ecology • Addressing Climate Change and Agriculture • New policies on Trade and Food • Addressing Market Power in the Food System

23. Drivers of Price Increases, Volatility • Short-term causes: • Low inventories of key food crops • Export restrictions, border measures during crisis • Weather, possibly due to climate change • Depreciation of the dollar • Financial speculation in commodities markets • Long-term causes • Expansion of crop and land use for biofuels • Decline in food-producing capacity; import dependency • Growth of meat-based diets in large developing countries • Slowing yield growth for key food crops • Reductions in publicly funded R&D • Climate change

24. World Bank: Land Acquisitions

25. Figure 1. Forestry and Agriculture as a Percent of Total Greenhouse Gas Emissions Source: Figure adapted from UN Framework Convention on Climate Change , UNFCCC 2007

26. Figure 19. Global GHG Mitigation Potential from Agriculture Source: Adapted from Metz et al. 2007a and Smith et al. 2008, available at http://www.ipcc.ch/graphics/ar4-wg3/jpg/fig-8-4.jpg