Brookings: Topics - Global Food Crisis

Obama’s Budget and International Affairs: Level Funding but Noteworthy Changes

George Ingram — Thu, 11 Apr 2013 16:39:00 -0400

There has been lots of reporting and analysis of President Obama’s FY 2014 budget, particularly on key domestic elements and on defense, but little attention has been given to the international part of the budget.

The most thorough and careful analysis of the international affairs account was released yesterday by the U.S. Global Leadership Coalition.

No need to repeat the analysis here, but I will highlight several noteworthy elements in the budget:

Funding is straight lined from FY 2013 spending levels (includes sequestration), which is about a 15 percent reduction from 2010 levels.
Funding for a range of development activities would increase, including for the development assistance account, health, women and girls, food security, multilateral development banks, and disaster assistance.
Funding to engage the U.S. private sector in development is up significantly – funding for the Overseas Private Investment Corporation increases by one third and for the Trade and Development Agency by a quarter.
Selectivity is alive, with hard decisions being made to reduce the USAID presence in 11 countries, funding for agriculture and HIV/AIDS programs in select countries, and funding for frontline states (Iraq, Afghanistan, and Pakistan).
Embassy security would receive significantly higher funding.

While there are a number of significant changes proposed in the budget, the one that has received the most attention – beginning with leaked information six weeks ago and again with the release of the budget – is the proposal to bring greater efficiencies to food assistance. The heart of the proposal is to reduce the requirement to purchase U.S. commodities and to transport them on U.S. ships, which are costly in terms of time and money, and to allow greater flexibility in purchasing required food items on the open market. Another aspect of the change is to substitute cash payment for “monetization”. Under monetization, U.S. NGOS receive U.S. commodities, ship them to a developing country, and sell the commodities in the local market. The cash is then used to fund important development activities. But there are losses at the several steps in this process so it is an inefficient means of financing development. The same amount of cash directly to the NGOS would reach more beneficiaries.

The proposed reform of food assistance has engendered intense interest and debate within the NGO development community, with some strongly supporting the reform proposals and others more concerned resources could be lost in the legislative process. Two groups, the Modernizing Foreign Assistance Network and Interaction, released statements yesterday, both supportive of reform, but one emphasizing the benefits of reform and the other also seeking to ensure that benefits of the current system not be lost.

However, initial reactions on Capitol Hill have been mixed.

Authors

George Ingram

Image Source: © Kevin Lamarque / Reuters

CAADP at 10: Progress Toward Agricultural Prosperity

Mwangi S. Kimenyi, Brandon Routman, Andrew Westbury, John Omiti and Tunji Akande — Mon, 14 Jan 2013 12:21:00 -0500

Food security remains one of the key challenges that African countries confront today. This problem is most visibly evidenced by frequent food shortages and famines, such as the crisis in the Horn of Africa that lasted from July 2011 to February 2012 and impacted some 13 million people. But it is also illustrated in less visible, but no less dramatic, ways: The Food and Agriculture Organization (FAO) estimates that 26 percent of Africa’s population is undernourished. Such a figure is not only tragic, but also has devastating long-term consequences for Africa’s economic development. There is a clear link, for instance, between malnourishment and poor health and low education attainment, both important components of human capital.

Thus, for sustainable development to take root, Africa must attain food security, which should be accomplished largely through increasing its own production. Unfortunately, at present, Africa’s agricultural productivity is extremely low. For instance, in 2010, the continent’s cereal production was roughly 1,300 kilograms per hectare, roughly half of that of South Asia (World Bank, a). This poor performance is a result of a number of factors. First, the percentage of arable land that is irrigated in Africa is low, much smaller than an analogous percentage for Asia, 3 percent versus 47 percent (FAO, 2012). In addition, Africa uses less fertilizer than other regions of the globe; compare its 11 kilograms per hectare of arable land versus South Asia’s 169 kilograms (World Bank, a). It also utilizes less machinery: In 2003, there were 1.3 tractors per hectare of arable land in the sub-Saharan region, while the Asia and the Pacific region averaged 14.9 (Ashburner and Kienzle, 2011).

The African Union (AU) has recognized the challenges these factors and low agricultural productivity present to the long-term development of the continent. In the AU’s Second Ordinary Assembly held in July of 2003 in Maputo, Mozambique, African heads of state ratified an initiative called the Comprehensive Africa Agriculture Development Program (CAADP). The program, part of the New Partnership for Africa Development (NEPAD), was endorsed as a framework meant to create ambitious institutional and policy transformation in the agriculture sector. It was, and is, an agreed-upon process (the label “program” is, in some respects, a misnomer) that embodies unique goals and principles. For example, CAADP implementers sought to address fundamental obstacles to African agricultural development, including the sector’s reliance on external technical assistance, the lack of African political leadership and commitment, as well as poor planning and coordination between national and regional stakeholders. Other agricultural programs initiated at the same time focused predominately on issues of emergency relief, offering short-term solutions, frequently implemented independent of national systems and protocols (Simmons and Howard, 2009).

The explicit goal of CAADP is to “eliminate hunger and reduce poverty through agriculture”1. In pursuit of this aim, African governments commit to two “targets.” The first is to achieve 6 percent annual growth in agricultural productivity by 2015. The second was to increase the allocation of national budgets directed to the agricultural sector to at least 10 percent. The program also has four stated objectives, or “pillars.”

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Authors

Mwangi S. Kimenyi
Brandon Routman
Andrew Westbury
John Omiti
Tunji Akande

Image Source: © Handout . / Reuters

CAADP at 10: Progress Toward Agricultural Prosperity

Fri, 14 Dec 2012 09:00:00 -0500

Event Information

December 14, 2012
9:00 AM - 2:00 PM EST

Stein Room
Brookings Institution
1775 Massachusetts Avenue NW
Washington, DC

On December 14, the Africa Growth Initiative (AGI) at the Brookings Institution hosted a discussion on the Africa Union’s Comprehensive African Agricultural Development Program (CAADP). The event culminated in an AGI review of the program, which produced a report examining CAADP’s historical performance and future prospects. This was done in partnership with TransFarm Africa.

The event featured remarks by Mandi Rukuni, a former dean and faculty member of the University of Zimbabwe, Harare and the co-author of a report entitled, “CAADP—Sustaining the momentum in to the next decade.” Following Mr. Rukuni’s remarks were three discussion sessions. The first tackled strategies for national-level implementation of CAADP. The second assessed the role of the private sector within CAADP. The third addressed the role for regional integration within the process. The selection of these topics was informed by research undertaken by AGI. Mwangi Kimenyi, director and senior fellow at AGI, Katrin Kuhlman, president of TransFarm Africa, and John Staatz, a professor emeritus at Michigan State University, served as moderators for the sessions. A final “wrap-up” session concluded the event with remarks by Jeff Hill, the director of policy at the Bureau of Food Security at USAID, and David Nielson, the lead agricultural service specialist at the Africa Region of the World Bank.

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The Gold Effect on Inflation

Urjit R. Patel — Thu, 22 Nov 2012 13:53:00 -0500

The data flow in recent months suggests that despite considerable tightening of monetary policy by the Reserve Bank of India (RBI) over the course of 2010 and 2011, inflation, whilst having declined, has exhibited disquieting stubbornness. India has also been an outlier in relation to most of its comparators in the context of price stability. Evolution of Indian inflation has brought forth several explanations, most with some merit. Among these both monetarist theories and structural explanations have been advanced, as well as internal and external factors. In the former category, a delay or insufficient tightening early in the cycle resulted in generalised inflationary expectations to percolate widely through the economy; in other words, policy makers initially underestimated the risk. In the second category, domestic food price developments catalysed by changes in minimum support prices are drivers. In addition, it has been argued that wage push on account of government funded entitlement schemes in rural areas continues to put upward pressure on prices. Among the external causes, high oil prices since 2008 has been important in policy discourse. Another external variable that has, intermittently, lent itself as a contributor to price pressure at home is high global prices of diverse food cereals.

At its simplest, interest rate changes for controlling inflation works by tempering current investment and consumption by making it more expensive to borrow; in part, growth in aggregate demand is moderated through inducing a change in expected future market interest rates. Usually, the private sector responds to the change in incentives more than the government. Cumulatively, over the cycle, the RBI’s policy rate changes have been prima facie striking, even as the impact on inflation has been gradual and less effective than what policy makers had probably hoped for. The Repo rate was increased in thirteen steps between March 2010 and October 2011 from 4.75 percent to 8.5 percent. Inflation measured by the Wholesale Price Index has remained above the RBI’s comfort zone of 5-5.5 percent for three years now, and persists in the 7-8 percent range. The Consumer Price Index, which analysts claim is important for assessing the trend in inflation expectations has stayed in the range of 9-10 percent since April 2012; that is why the RBI has refrained from further cuts since the fifty basis point reduction in April.

There can be several plausible reasons for the relatively slow price response to an activist monetary policy including, inter alia, a deep fiscal malaise requiring persistent increases in seignorage which is feeding expectations of continuing inflation, “misbehaviour” of monetary policy transmission channels vis-a-vis the real economy, etc. It is noteworthy that seignorage as a ratio to GDP has seen an uptick in India post-2007 compared to immediately prior years in that decade.

There might be an additional explanation. Indians in recent years have benefited from a huge positive boost to their private wealth (and private net worth); this wealth effect originates in the 75 percent increase in global gold prices between October 2009 (roughly US$ 1,000/ounce) and October 2012 (about US$ 1,750/ounce); in Rupee terms the increase is more. Even while keeping aside the rise in volume (that is, inflow) of gold imports in recent years, India’s widely held private stock of gold is disproportionately large; a quick data scan reveals estimates of the stock ranging from a low of 13,000 tonnes to as high as 40,000 tonnes (the latter is probably an exaggeration). As an example, assume that the private stock of gold in India was 17,000 tonnes in 2009; the value of this in October 2012 would work out to about US$ 960 billion (over 50 percent of gross domestic product) compared to around US$ 550 billion three years earlier. The time frame is illustrative, and some other snapshot can be used.

There is little doubt that India is sui generis when it comes to the importance of gold in its citizens’ portfolio of savings instruments and stock of wealth. While gold is not the only global commodity whose price has increased appreciably, gold has characteristics that are distinctive. Households rarely hoard other commodities to pass them from one generation to the next; the exception would be oil owned by Saudi princes. Long after the “Gold Standard” become history, gold held by central banks, national treasuries and multilateral institutions is still counted as a foreign asset in official balance sheets. Physical gold as store of value and as a “guarantee to redeem promises” puts it in a class of its own among physical assets.

While the real value of most financial assets held by Indians has declined (in line with developments elsewhere), house prices have somewhat moderated and business investment has stalled against the background of poor governance, the boost in the value of the stock of gold may have engendered wealth effects that propped up household consumption (at least to some extent) even as policy has increased interest rates across the board. It is not unreasonable that enhanced feeling of well being due to higher wealth can induce a consumer to spend a higher amount from her recurring “normal” income. Of course, it is not that policy induced interest rate hikes have been ineffective for price and real economy developments; the argument is that a coincidental, essentially external, dynamic may have helped to partially offset the effects of monetary tightening. Asset prices have been known to unravel – especially instances when the run up is of the “bubble” variety rather than fundamentals driven, which may be more enduring. Therefore, households’ perception of the permanence or temporariness of the gold price increase (and their increase in wealth) is critical for determining the extent to which their consumption has been impacted on account of this channel.

In conclusion, if gold prices stay elevated or increase going forward, and wealth effects emanating from this externally generated feature are quantitatively important, than monetary policy has that much more work to do to tame inflation.

Authors

Urjit R. Patel

Publication: Business Standard

Image Source: © Ajay Verma / Reuters

Scaling Up in Agriculture, Rural Development, and Nutrition

Johannes F. Linn, Laurence Chandy and Raj M. Desai — Wed, 27 Jun 2012 14:06:00 -0400

Editor's Note: The "Scaling up in Agriculture, Rural Development and Nutrition" publication is a series of 20 briefs published by the International Food Policy Research Institute. To read the full publication, click here.

Taking successful development interventions to scale is critical if the world is to achieve the Millennium Development Goals and make essential gains in the fight for improved agricultural productivity, rural incomes, and nutrition. How to support scaling up in these three areas, however, is a major challenge. This collection of policy briefs is designed to contribute to a better understanding of the experience to date and the lessons for the future.

Scaling up means expanding, replicating, adapting, and sustaining successful policies, programs, or projects to reach a greater number of people; it is part of a broader process of innovation and learning. A new idea, model, or approach is typically embodied in a pilot project of limited impact; with monitoring and evaluation, the knowledge acquired from the pilot experience can be used to scale up the model to create larger impacts. The process generally occurs in an iterative and interactive cycle, as the experience from scaling up feeds back into new ideas and learning.

The authors of the 20 policy briefs included here explore the experience of scaling up successful interventions in agriculture, rural development, and nutrition under five broad headings: (1) the role of rural community engagement, (2) the importance of value chains, (3) the intricacies of scaling up nutrition interventions, (4) the lessons learned from institutional approaches, and (5) the experience of international aid donors.

There is no blueprint for when and how to take an intervention to scale, but the examples and experiences described in this series of policy briefs offer important insights into how to address the key global issues of agricultural productivity, food insecurity, and rural poverty.

Authors

Publication: International Food Policy Research Institute

Image Source: Michael Buholzer / Reuters

@ Brookings Podcast: Food Insecurity in Africa

Mwangi S. Kimenyi — Fri, 01 Jun 2012 16:58:00 -0400

Drought, low agriculture productivity and a cascade of bad policy choices have put millions in the Horn of Africa and the Sahel at risk for starvation. Senior Fellow Mwangi Kimenyi, director of the Africa Growth Initiative, says the consequences will haunt the continent for decades to come.

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Mwangi S. Kimenyi

Image Source: © Feisal Omar / Reuters

Crisis in the Horn of Africa and the Sahel: The Cost of Late Response to Early Warnings

Tue, 22 May 2012 10:00:00 -0400

Event Information

May 22, 2012
10:00 AM - 12:00 PM EDT

Saul/Zilkha Rooms
Brookings Institution
1775 Massachusetts Avenue NW
Washington, DC 20036

The Horn of Africa is in the midst of the worst drought in more than 60 years. Although there were clear early warning signs, the international response was insufficient until the crisis reached a tipping point. Now signs are pointing to a similar situation unfolding in the Sahel region of West Africa. Since the beginning of this year, NGOs, governments and early warning systems have pointed to looming dangers in both the Sahel and Horn regions. The international community must improve its ability to prevent the worst effects of chronic crises by more effectively investing in long-term development and by accelerating the response when early warnings are in place.

On May 22, the Brookings-LSE Project on Internal Displacement, Save the Children and Oxfam America hosted a discussion on what NGOs, national governments and the international community can do to respond earlier to immediate crises and to the long-term challenges of areas with chronic food insecurity. Panelists including Catherine Bragg, United Nations Assistant secretary general of Humanitarian Affairs (UNOCHA); Paul O’Brien, vice president of policy and campaigns for Oxfam America; Michael Klosson, vice president for policy and humanitarian response at Save the Children; and Nancy Lindborg, assistant administrator for the Bureau for Democracy, Conflict and Humanitarian Assistance at USAID, discussed the international community's ability to prevent the worst effects of chronic crises. Brookings Fellow Megan Bradley provided introductory remarks and moderate the discussion.

After the program, speakers took audience questions.

Participants

Panelists

Megan Bradley

Catherine Bragg

Assistant Secretary General for Humanitarian Affairs, Office for the Coordination of Humanitarian Affairs

Michael Klosson

Save the Children

Nancy Lindborg

Assistant Administrator for the Bureau for Democracy, Conflict and Humanitarian Assistance

Paul O'Brien

Vice President, Policy and Campaigns

More Effective Aid: the G8’s Approach to Food Security

David Gartner and Homi Kharas — Fri, 18 May 2012 15:11:00 -0400

As G-8 leaders meet to review their progress around the 2009 L’Aquila commitments on food security, they should borrow lessons from previous G-8 initiatives and foster more participatory and performance-based institutions. In the 21st century, the state-centric paradigm of development must increasingly embrace a greater role for non-state actors in order to successfully leverage resources, catalyze effective implementation and achieve results. The focus on private sector investment in food security at this year’s G-8 summit reflects this reality, however key governance structures have not yet adopted the best practices from earlier G-8 initiatives in fields such as global health. The Global Agriculture and Food Security Program (GAFSP) should move toward more participatory governance, especially at the country-level, and more performance-driven approaches to allocating resources to those countries facing the greatest risk of malnutrition.

As we found in a recent paper examining vertical funds across global health, education and agriculture, the structural characteristics of development institutions are critical to shaping their ultimate impact. More independent, more participatory and more performance-based vertical funds are outperforming less independent, less participatory, and less performance-based vertical funds when it comes to resource mobilization, learning and development impact. In the agriculture sector, GAFSP reflects some of these insights in that it allows civil society organizations to be non-voting members of its board and requires that 30 percent of its public sector window investments be assessed through rigorous impact evaluations. However, GAFSP does not engage adequately with non-state actors to scale up programs, has limited mechanisms for country-level participation, and does not yet explicitly tie future funding flows to performance.

In the wake of the 2009 L’Aquila commitments, there was initially a significant increase in agricultural funding in 2010. However, only seven of the 40 donors in L’Aquila have actually pledged resources to the GAFSP and less than one-quarter of the $22 billion commitment was disbursed as of last July. In addition, just 17 percent of all agricultural aid is currently directed towards the 25 countries with the highest levels of hunger. The latest round of proposals to GAFSP is slated to total less than one percent of the L’Aquila commitment and multilateral vertical funds still represent less than one-quarter of funding for the sector. In order to come close to meeting the original G-8 commitment, more effective global financing mechanisms and more diverse implementers will be required along with more robust commitments of resources from G-8 countries and private actors.

The G-8 should support a greater role for non-state actors in the governance and implementation of GAFSP resources as it seeks higher levels of investment from private actors. Specifically, it should require all national plans that it funds to be truly country-driven with civil society actors actively involved in creating and implementing the underlying strategy. In addition, GAFSP should encourage non-state actors, as well as national governments, to scale up initiatives using its resources in order to expand the capacity to rapidly scale-up impact. Finally, GAFSP should more explicitly embrace a performance-driven model of financing by requiring that funding flows for all recipients be tied to their contribution to achieving key targets, including reducing malnutrition and improving small-holder productivity. With stronger financial backing from the G8 and reforms along these lines, the GAFSP could make an important contribution to furthering food security.

Authors

Image Source: Reuters

The Other Half of the Battle: Obama, the G8 and Food Security in Africa

Mwangi S. Kimenyi and Witney Schneidman — Fri, 18 May 2012 14:21:00 -0400

Tomorrow in Chicago, President Obama will roll out phase two of his administration’s signature food security initiative, Feed the Future. In order to underscore the importance that he attaches to this flagship program, Obama has invited the leaders of Ethiopia, Benin, Tanzania and Ghana – which are all key Feed the Future partner countries – to participate in the G-8 meeting on Saturday at Camp David.

There is no question that food security deserves to be discussed as a priority at the G-8. One-quarter of the people in sub-Saharan Africa are undernourished and one-third of African children are stunted in their development. As Helen Clark, the administrator of the U.N. Development Program notes in Toward a Food Secure Future, the first ever Africa Human Development Report, “the silent crises of chronic malnourishment and seasonal hunger do not receive nearly enough attention.”

President Obama was influential in persuading the G-8 leaders to focus on food security at the 2009 G-8 meeting in L’Aquila, Italy where world leaders pledged $20 billion over three years to address the problem. The U.S. itself committed to invest $3.5 billion.

In addition to building on Feed the Future, which reportedly will include a major private sector initiative, President Obama will face several challenges over the next two days related to food security.

The first will be to convey a sense that Feed the Future is beginning to have an impact in reducing malnutrition, increasing crop yields and increasing national and private sector investments in agriculture. Even though this program has the potential to significantly improve food security in the region, the results have yet to be realized by the intended beneficiaries.

A second challenge will be to ensure that the financial commitments made in 2009 by the G-8 partners are being honored. Finally, any new commitments and programs need to be accompanied by clear bench marks so that progress can be measured and accountability assured.

President Obama is to be applauded for reversing a long downward trend in U.S. attention to global food security issues. Putting in place initiatives that make a qualitative and sustainable difference is the other half of the battle.

Authors

Mwangi S. Kimenyi
Witney Schneidman

Image Source: Thierry Gouegnon / Reuters

@ Brookings Podcast: Can the World Sustain Seven Billion People?

Homi Kharas — Fri, 06 Jan 2012 16:20:00 -0500

With better health care and nutrition, people around the world are living longer and having more children, pushing the population of planet Earth above the seven billion mark. Expert Homi Kharas says while the reasons for growth are positive, the population explosion means world governments must develop more sustainable policies to provide goods and services.

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Local Governance Reforms Are Critical to Improving the Effectiveness of IMF/World Bank Lending to Africa

Julius Agbor and Olumide Taiwo — Thu, 29 Sep 2011 16:07:00 -0400

In the wake of the global financial crisis and the persistent global food and fuel price shocks, international development institutions — notably the International Monetary Fund (IMF) and the World Bank — have increased their concessional lending to low-income countries, particularly those in sub-Saharan Africa. In 2009 and 2010, the IMF committed new concessional lending to sub-Saharan Africa of about $4 billion, compared to $1.1 billion in 2008 and only about $0.2 billion in 2007. The IMF’s concessional lending is expected to reach $17 billion in 2014.

With higher amounts of aid from the IMF flowing to sub-Saharan Africa, issues of governance and accountability become crucially important. There is a need to ensure that the resources acquired from concessional lending translates into poverty reduction, lower infant mortality and malnutrition rates, increased rural infrastructure, higher school enrollment, and better education and learning outcomes.

However, with a few exceptions, most sub-Saharan African countries that stand to benefit from IMF concessional lending are the poorest performing in terms of governance indicators. For instance, only Ghana and Lesotho were highly ranked on the 2010 Mo Ibrahim Index of African Governance, while only Ghana received a favorable global ranking as the least corrupt country in the 2010 Transparency International Corruption Perception Index (CPI).

In recognition of the governance deficiency in Africa, the IMF is currently upgrading the focus of its concessional loan’s conditionality from broad public participation and country ownership to issues of transparency in the management of public resources. In addition, the World Bank’s Extractive Industries Transparency Initiative (EITI) aims to strengthen governance in natural resource-rich countries through the full publication and verification of company payments and government revenues from oil, gas and mining. While these initiatives could have the potential to improve governance at the national level, it is unclear whether such a top-down accountability model would improve governance at local and council levels, where accountability in service delivery is most needed.

The gradual shift in emphasis among development partners toward local accountability and inclusiveness, in order to ensure prudent management of public resources and service delivery, comes as no surprise. Strategies to achieve these objectives have been mainly placed on decentralization efforts, such as the transfer of political, financial and administrative authority and responsibilities to local councils and entrenching competitive multiparty elections at the council level. The idea here is that free and fair elections give constituents the opportunity to demand accountability from elected local council officials. Unfortunately, in practice, decentralization and multiparty elections do not always guarantee local accountability and effective service delivery. This is not even in the case in some of Africa’s most established democracies.

Typically, candidates running for local council are chosen through primaries held by each political party. In most cases, party “kingmakers” provide financial and organizational support to candidates on the condition of their party allegiance. Therefore, in the use of local council funds, elected local authorities tend to prioritize political party interest at the expense of constituents’ needs. In other instances, candidates would borrow from financial institutions to finance their electoral campaigns and would pay back with council funds. Either way, the consequence is that funds allocated for basic services are captured by local officials. The World Bank Expenditure Tracking and Service Delivery Surveys, which cover 15 countries in sub-Saharan Africa, show that in the absence of interventions, large amounts of funding for education and health services are diverted by local officials and politicians.

In many African countries, institutional frameworks that balance the interests of politicians and political parties with the needs of local constituent are weak or nonexistent. Therefore, there is a general lack of accountability for local politicians and officials. Constituents often do not have a way for redress if services are not delivered other than to wait for the next election in four to six years. Therefore, free and fair elections cannot be used as the sole mechanism for ensuring political accountability, as many African politicians tend to renege on their electoral promises soon after they are elected.

The current consensus that more information guarantees transparency ignores the fact that having information is one thing but being able to act on it is another. Constituents’ ability to critically scrutinize local officials depends on the extent of their supervisory power within the local governance framework. In many cases, this supervisory power is weak or non-existent.

To address the underlying institutional weakness, we suggest the following two reforms in the governance of local councils in sub-Saharan Africa: The framework of local governance should be restructured to provide constituents with the power to recall non-performing or corrupt officials. Additionally, political party involvement should be de-emphasized in local governance. The latter is not entirely new to Africa. In Ghana political parties are banned from participating in local elections, which allows constituents to supervise their elected officials. Indeed, the World Bank Expenditure Tracking and Service Delivery Surveys show public resource leakage rarely occurs between the district government and the recipient facilities in Ghana, demonstrating that accountability is better enforced by empowered constituents.

Local accountability will remain elusive as long as it is inhibited by decentralization and elections. Currently, the election process does not control the quality of political kingmakers, or the institutions that restrain the behavior of elected leaders.

Authors

Democratic Governance Is Critical to Averting Famines in Africa

Julius Agbor and Nelipher Moyo — Mon, 26 Sep 2011 14:04:00 -0400

During the last two decades, African countries have overwhelmingly embraced multiparty rule and in 2011, over 27 general elections were scheduled throughout the region. At first glance, it appears democracy has taken root and with it, expectations of improved standards of living. Sadly, this has not been the case for many African countries as human calamities imposed by disease, extreme hunger, malnutrition, and worse still, famines, persist. With the ‘advances’ in multiparty democracy, how is one to then understand the correlation between democratic advancement and the persistence of famines in Africa?

The answer lies in acknowledging that most African countries are still in the process of consolidating their democracies. Indeed, Africa is the only continent in the 21st century that has experienced, and continues to experience, mass mortality due to food crisis, with four countries—Ethiopia in 2000, Malawi in 2002, Niger in 2005, and Somalia in 2011—officially attaining the stage of famine.

This reality seems to contradict Amartya Sen’s theory that no functioning multiparty democracy can experience famine because democratic institutions—regular free and fair elections, independent courts and legislatures, free press and vibrant civil society—are all effective mechanisms of upholding the basic rights of citizens, including the right to food (“Development as Freedom,” 1999:178). Democracy also offers vulnerable citizens the opportunity to vote out incompetent governments that fail to deliver improved well-being to their constituents. Indeed, as de Waal in “Democratic Political Process and the Fight against Famine” (2000:12) asserts, ‘fully functioning democracies do provide protections against famine, but weak democracies might not’.

Evidence suggests most of the famines recently witnessed in Africa have been largely due to institutional failures resulting from the lack of broad-based accountable governance and much less to market or production failures. This governance deficiency often manifests itself through imperfect institutions, which either fail to reallocate production surplus away from food-surplus areas to food-deficit ones within the same country, or are incapable of effectively providing food price support to vulnerable citizens. Although the decline in food availability is almost inevitably witnessed immediately before all major famines, it has not been the main precursor. If met with timely and effective responses, declining food availability can be prevented from degenerating into a famine. Usually, effective anti-corruption mechanisms and efficient public interventions in agricultural support systems and extension services, effectively address food availability declines in the build-up to a famine. This was lacking in the Malawian famine of 2002, where government failures exacerbated production and donor response failures thereby precipitated an else-while avoidable human catastrophe.

Note that in the year preceding the famine, the Malawian government, faced with high deficits and the need for fiscal consolidation, yielded to International Monetary Fund (IMF) recommendations to export all of its 180,000 tons of grain stocked in its Strategic Grain Reserve (SGR). Contrary to what many believe, the destocking of the SGR in itself was not the major cause of the famine. Instead of exporting the grain for much needed foreign exchange, rent-seeking Malawian bureaucrats hoarded the grain until prices escalated beyond the purchasing power of the average citizen—resulting in famine. Thus, had there not been a governance problem, the famine in Malawi could have been averted. Similarly, ineffective government support structures to prevent the decline in food availability or, at least, to respond timely in the wake of decline, have resulted in famines elsewhere in Niger, Somalia and Ethiopia.

While a range of factors, arguably exogenous to government control—such as climate change and international donor response—are crucial in the famine prevention strategy, emphasis must be placed on accountable democratic governance as an effective mechanism for averting famines in Africa. An anti-famine political contract between citizens and the state, which democracy promotes, can be effective at addressing declining livestock/grain terms of trade shocks that frequently challenge poor households.

A functioning democracy also offers additional checks against inappropriate national policy choices. For instance, the abolishment of agricultural buffer stocks and the elimination of farm subsidies would normally be scrutinized by civil society, non-governmental organizations and the parliament before being implemented by executive powers. Unfortunately, these underlying institutions—independent legislatures and courts, free press and vibrant civil society—are crucially deficient in most of Sub-Saharan Africa. Furthermore, even where these institutions are enshrined in the national constitutions, the political will to render them effective is usually absent.

So far, the short-term response of international donors and humanitarian organizations has helped mitigate the effect of famines in Africa but the strategy to prevent the next famine lies in demanding effective governance institutions and supporting institutions with similar goals on the continent.

Authors

Julius Agbor
Nelipher Moyo

Image Source: Â© Feisal Omar / Reuters

An Economic Perspective on the Refugee Crisis in Africa's Horn

Anne W. Kamau — Mon, 12 Sep 2011 13:18:00 -0400

Political repression, conflicts, drought and economic instability have resulted in twin humanitarian crises in the horn of Africa: widespread famine and an influx of refugees and internally displaced persons. Much attention has been directed at the famine situation which has received overwhelming international response. However, there has been much less effort to address the refugee and internally displaced persons crisis. As of last month, it is estimated that there are 800,000 refugees and approximately 1.46 million internally displaced persons across Kenya, Ethiopia, Somalia and Djibouti. Already the refugee camps that serve as “safe havens” are over stretched due to congestion and lack of sufficient services, such as food, water and security.

The influx of refugees is imposing substantial environmental, social and economic costs to the host nations. In Ethiopia, the residents of Dollo Ado— the Gerimero community, who claim to be the first settlers of Dollo Ado— are complaining about the rising cost of living and insecurity associated with the influx of refugees. The natives fear that some of the refugees are members of terrorist groups such as Al Shabaab. In other cases, the presence of large numbers of refugees is raising the potential for conflicts as the natives and refugees fight for scarce resources.

As large flows of refugees settle in the interior of these countries, they begin to impact the cost of housing and commodities. For example, the exodus of Somalis to Kenya has resulted in significant population changes in some of Kenya’s cities. In some parts of Nairobi such as Eastleigh, the Somali population has increased so much that the area is now commonly referred to as “Small Mogadishu”.

The capacity of these countries to respond to the refugee and internally displaced people crisis is severely constrained because they are also facing difficult economic times. Rising food and fuel prices have led to soaring inflation of 16.7 percent in Kenya, 39.2 percent in Ethiopia and 5.2 percent in Djibouti. With the widespread drought across the region, there has been increased demand for imported food. Simultaneously, these economies have faced a rapid depreciation in their currencies, which further increases the cost of food and medical supplies.

With limited instruments to deal with the economic crisis, attempts to stabilize these economies have resulted in yet another problem of rising interest rates. These countries are grappling with the unholy trinity of inflation, rising interest rates and unstable exchange rates. All of these issues are adversely hurting economic growth in Africa’s horn. Unemployment, especially among youth, is compounding the economic situation, which is only exacerbated by the influx of refugees.

The refugee and displaced persons crisis is likely to continue as the drought persists and the political crisis in Somalia remains unresolved. Food insecurity in Somalia is projected to last until December. And although food security in Kenya is projected to improve in the next few months, Kenyan authorities have indicated that the country will not be able to cope with additional refugees. Kenya’s President Mwai Kibaki has proposed that refugee camps be established in Somalia rather than Kenya as a way to control the influx of Somali refugees.

While the capacity of the host countries to absorb all the refugees is constrained by the ailing economic situations, a longer term and economically viable solution to the refugee problem is of urgent necessity. Refugees arrive in the camps with nothing and it is costly for host countries and aid givers in the long term to continue providing food, shelter and clothing. However, skilled and experienced refugees who have managed to move into these countries’ interior regions have been able to engage in various economic activities. Therefore, there is a possibility then that skills can be harnessed in these camps and aid can be channeled to engage refugees in economic activity such as building infrastructure in the affected cities and increase staffing in the government provided services. This is more beneficial to the refugees and at the same time to natives of affected cities in the longer term. A lot of refugees would like to go back to their countries when peace is restored, but not without resources or some gained skills that would enable them start life again. However, it is important to note that the permanent solution to refugee and internally displaced persons problems lies squarely on the ability of African countries to tackle the root causes, which include corruption, greed and a lack of true democracy.

Authors

Anne W. Kamau

Image Source: Â© Ismail Taxta / Reuters

A Regional Approach to Managing Africa's Food Shocks

Mwangi S. Kimenyi, Nelipher Moyo and Jessica Smith — Tue, 23 Aug 2011 15:15:00 -0400

The tragic famine in Somalia brings to mind harrowing images from the country’s past famines and others in the Horn of Africa, and yet again, the international community has responded generously by providing both food and medical aid. Watching the heartbreaking images of emaciated children and loss of life, one cannot but wonder if this tragedy could have been avoided. An even more pertinent question is whether this crisis will recur in the near future, with similar consequences. Although, droughts are a frequent occurrence in the region, it is critically important to rethink strategies for responding to famines that go beyond increasing the productivity of African agriculture and food aid. On August 25th the African Union (AU) will host a meeting to examine the crisis in Somalia and discuss medium-to-long term crisis-mitigation strategies. We suggest that any viable strategy must take a regional approach consistent with the broad economic development strategy endorsed by the AU.

The improvement of agricultural productivity has been a key focus of the response to long-term food security in Africa. The continent has experienced a declining trend in food production relative to population growth therefore it is important that Africa continue to prioritize food production. However, food supply is just one of the problems Africa faces, and often not the main problem. In many countries, inadequate “food governance” structures are apparent, as evidenced by the existence of surpluses in one region and severe shortages in another. For example, in January 2011 the northeastern part of Kenya experienced livestock and human fatalities due to forage and food shortages while the Kenya’s Rift Valley region experienced massive food surpluses with farmers demanding the government purchase their excess crops lest they rot. These disparities also exist within a single region. Amidst the severe famine in the hard hit Turkana Region of Kenya, farmers are sitting on bumper harvests wondering how they will store their surpluses. These imbalances are apparent across the continent -- East Africa is currently facing the worst famine and drought in decades while Southern Africa is reporting good rainfall and grain surpluses.

On the whole, the food deficit on the African continent may not be as pronounced as it is often reported. The Food and Agriculture Organization of the United Nations estimates that in 2007 the per capita dietary energy supply in Africa was about 2455 kilocalories per day, which is only slightly less than the daily recommended average. In addition, FAO and the World Bank have estimated that Africa loses about $4 billion worth of grain per year due to a lack of adequate post-harvest technologies, which would meet the minimum annual food requirements for about 48 million people. The African Postharvest Losses Information System reports that about 10 to 20 percent of Africa’s grain production is lost post harvest. This occurs across agricultural sectors in Africa milk losses in Kenya, Uganda and Tanzania are high due to spoilage and wastage. The cost of wasted product in each of these countries has been estimated to reach US$ 22.4, US$23, and $US 11 million per year, respectively.

So while there are food shortages in Africa, the problem of food insecurity is greatly exacerbated by inadequate management of existing food resources. Thus, the problem of long term food security can be reduced significantly through improved “food governance.” This includes improved distribution channels, infrastructure (to reach markets), food preservation techniques (to prevent food losses), and strategic grain reserves (both virtual and physical). Weather indexed insurance, fertilizer subsidies and social safety net transfers such as cash or food transfers during crises have also been effective in reducing food insecurity.

Mali and Ethiopia are examples of successful “food governance” systems in Africa, both of which face highly variable rainfall patterns and rely on rain-fed grain production. Mali, the more arid of the two, has held strategic reserves through the Programme de Restructuration du Marché Céréalier [Program for Restructuring the Cereal Market] or PRMC since 1981. The PRMC successfully mitigated the 2004-2005 drought and subsequent locust invasion that devastated neighboring Niger. PRMC phased out its role as an intervener in the grain market and bolstered its role as a provider of market information and social safety nets via emergency grain stock. After the 2004-2005 period of drought, PRMC adjusted their reserves from 35,000 metric tons to hold 69,000 metric tons of cereals, rice, and coarse grains. This adjustment was made in order to keep supplies low enough to avoid distorting grain market prices, but large enough to cover food shortages experienced during the 2004-2005 drought.

Similarly in Ethiopia the Emergency Food Security Reserve Administration (EFRSA), an independent government agency, handles emergency food reserves and has mitigated several scenarios since the severe crisis of the 1970s. Recent efforts to extend social safety net features, via the Productive Safety Net Programme (PSNP), have met considerable success using combinations of cash and work transfers. Separating the strategic reserves from the grain marketing board has been credited as a primary reason for the success of PRMC and EFRSA.

Unfortunately, the effectiveness of a national strategy becomes strained when there is a shock to the entire region. In the case of Ethiopia, Somali refugees have flooded into the country, thus strategic reserves and social transfers have proven inadequate to address the increased demand. We call for African food security policies that contain built-in mechanisms that counteract the incidence of failure on the national level due to an influx of refugees, extraordinary natural disaster, conflict, etc.. We propose that if and when a particular country is unable to manage a crisis, there should to be an established blueprint for administering intra and inter-regional assistance bolstered by the support of the international aid community.

A Regional Approach to Food Supply Management

There has been significant discussion among Africa’s regional economic communities (RECs) to develop regional strategies to address food security, but these discussions have not been translated into action. The New Partnership for Africa’s Development (NEPAD) has proposed developing grain reserves based on regional blocs. The South African Development Community (SADC) has commissioned plans for a regional food reserve facility, but it has yet to reach consensus on implementation. In the Sahel, the Economic Community of West African States (ECOWAS) and Union Economique et Monétaire Ouest Afrique (UEMOA) have organized a coalition to advocate for food security in the region. ECOWAS and UEMOA have yet to implement regional reserves, but they have coordinated in raising $500,000 to address the 2010 drought in Niger. The East African Community (EAC) has developed a Food Security Action Plan 2010-2015 to improve preparedness and responses to food crises in the region. Despite the numerous plans and efforts across the region, regional food security mechanisms have not been implemented in Africa.

Regional efforts to implement medium and long-term strategies should be immediately accelerated and supported by international donors while this issue has international attention and urgency. The efforts of individual nations must be reinforced by a regional “food governance” strategy.

The first part of developing a regional food governance strategy in Africa is the development of regional food reserves as back-ups to national reserves. Regional reserves would serve as an effective reinforcement mechanism for national reserves, as regions tend to have more stable grain yields than individual nations. Regional efforts have the potential to reduce the costs associated with holding large stocks by individual countries and to assist during an extreme crisis when a country has depleted its own reserves. These stores could be a mix of physical and cash reserves. Asia provides an example of a regional food reserve programs that Africa can learn from. Through the ASEAN Plus Three Emergency Rice Reserve initiative, the region released 520 tons (equal to 10,400 bags) of rice to victims of the typhoon Ondoy.

As the main pan-African organization, the AU should facilitate transfers from food surplus RECs to food deficit ones. Similarities in dietary preferences across African sub-regions make this alternative much more attractive than food aid from the west. Furthermore, through this mechanism the AU could help to synchronize and coordinate the regional and international donor strategies.

The second part of the regional “food governance” strategy would be for RECs to help collect regional market information and make that information publicly available. This would allow private markets to attempt to redistribute food from surplus/low price areas to deficit/high price ones. It would also help to address information failures in African food markets and verify the conditions in which regional stocks are released. In order for this information to be used effectively, African countries must eliminate their food export bans. Food export bans during famines exacerbate the situation and make it difficult for producers with a surplus to reach demand. Tanzania’s decision to ban food exports has worsened the crisis in Kenya and other neighboring countries.

Another component of regional “food governance” would be regional risk management. Regional insurance markets may prove to be more effective than national ones to hedge against systematic risk. By developing regional weather indexed insurance markets, customers in Southern Africa could help insurance firms hedge against the large number of claims being submitted in East Africa.

The international community should work together with national governments, RECs and the AU to develop effective “food governance” mechanisms in Africa. Unfortunately, due to the urgency required to mobilize and distribute emergency aid, it is often vulnerable to corruption and captured by unintended parties. This was observed in Somalia during the 1991-1992 famine and there are reports that food aid has gone missing in Somalia during the current famine. Some explicit examples of effective “food governance” strategies include: supporting infrastructure projects to facilitate the transfer of food intra/inter regionally, providing financial support and capacity building for post harvest technologies, bolstering regional food reserves, collecting and disseminating market information and enhancing social safety nets.

Africa’s food deficit is not as acute as it appears from the human suffering that we see in the Horn of Africa. Better “food governance” can achieve significant progress in preventing the type of food crisis that is being observed in Somalia today. We recommend an integrated national-regional food governance strategy to reduce food production losses and facilitate the transfer of food from food surplus areas to food deficit ones across countries and RECs. As the AU gathers in response to the crisis in East Africa, the implementation of regional food governance mechanisms must be at the forefront of the agenda. The tragedy in Somalia should serve as the much needed push to move from the discussion of existing plans to fully operational regional food security programs. While increasing agricultural productivity is important, Africa can achieve a major victory by better managing its existing agricultural food supply.

Authors

Mwangi S. Kimenyi
Nelipher Moyo
Jessica Smith

Image Source: Â© Ismail Taxta / Reuters

Don't Perpetrate the Three Food Security Myths

Homi Kharas — Fri, 01 Jul 2011 15:20:00 -0400

Franz Fischler’s plan to banish starvation hits all the right notes, yet he also reinforces three myths about food security that distract from the real issues.

The first is that expanding food supply will be an insuperable problem. People increasingly ask whether the world can really produce enough to satisfy the explosion of demand from more people with the income to buy meat, dairy, fish and other proteins? And whether constraints on land, water and other resources mean we are reaching the limits of agricultural production? The short answer to these is, “yes” the world can produce enough food, and “no” we’re not yet reaching binding constraints.

According to the U.S. Agriculture Department, world grain production has risen from 824m tonnes in 1960 to around 2.2bn tones last year. There have been some fluctuations, but production has remained steady with 27m tonnes being added to production every year. This trend suggests that by 2050 the increase in grain production relative to today would be exactly 50%, the target Fischler sets as the global goal. In other words, major reform is not needed as we already have far better agronomic practices, seeds and fertilisers than ever. The one disclaimer has to be climate change. But that is still so unpredictable in its impact on agriculture that it has to be treated as a “wild card”.

Read the full article on Europe's World »

Authors

Homi Kharas

Publication: Europe's World

Making Sense of Food Price Volatility

Homi Kharas — Thu, 03 Mar 2011 11:19:00 -0500

Food prices have risen to record highs for the second time in three years. Some blame the hedge fund speculators who have funneled large amounts of money into futures contracts in food markets. They argue that market mechanisms are broken and need fixing. Others blame their governments (look at the riots in the streets of several developing countries) and find fault in the political systems, corruption and cronyism that have robbed them of the resources to afford higher food prices. Their solutions are political. Still others look to pervasive poverty and high income inequality as the reason why food price volatility is of such concern. They focus on the social aspects and solutions.

This separation into markets, politics and social stability is actually a useful frame for understanding how food prices affect developing countries and what needs to be done at a policy level. The issues are of course interconnected but too often the discourse becomes confused as one thread leads to another and the logic gets tangled.

As an initial point, it’s worth stressing that the crux of the food price challenge is about price volatility, rather than high prices per se. It is the rapid and unpredictable changes in food prices that wreak havoc on markets, politics and social stability, rather than long-term structural trends in food prices that we can prepare for and adjust to. And it is also worth noting that volatility cuts both ways—prices go up and down. The only reason food prices are going up so much this year is because they came down so fast after reaching 2008 peaks. Both rapid increases and rapid declines in food prices can create problems.

Food price volatility starts with the characteristics of food markets. What makes food markets distinctive is that both supply and demand curves are highly inelastic, meaning neither responds much to price changes in the short run. The most basic economics dictates that small shocks in either supply or demand will therefore lead to large price changes. Today, we have many shocks: supply shocks in important food producing countries due to extreme weather (droughts in Russia and China, floods in Australia and South Africa) and due to the higher cost of inputs (fertilizer, pesticides and transport over long distances) linked to oil prices. Demand shocks have come from sudden policy decisions to increase biofuel content in gasoline, for example. The result is volatility in food prices.

Because food prices are so inherently volatile, it is natural that speculators should enter futures markets in a big way. Speculators make money out of understanding and providing insurance against volatility. They do not create the volatility themselves, except under very strange conditions. Almost all serious studies have come to the same conclusion: the volatility inherent in the food marketplace causes speculation, not the other way around.

So what can be done? First and foremost, break the link between food prices and oil prices. The current global food system worked well in a world of cheap, stable energy prices which allowed food to be grown in concentrated locations and transported over huge distances to meet demands. That system will continue to give us volatility as long as oil prices remain volatile. I would not bet on a return to cheap, stable oil prices in the near term, so the answer must be to change the food system to adapt to the new economics of energy. That probably means more localized and more diversified production and consumption, less use of fertilizer, and less wastage (20 percent of all food gets spoiled in storage and transport today). Ironically, the organic, slow-food, go-local cooperative movement may find that market forces are their new best friend.

Second, invest more in agriculture. There seemed to be an international consensus that this was indeed important; and a U.S.-led international fund to promote investments in agriculture was launched last year (the Global Agriculture and Food Security Program), but faced with budget pressures few countries have made new pledges or lived up to their commitments. From a $20 billion headline goal, GAFSP is now struggling to find a few hundred million dollars to support its programs.

Third, get small-holder yields up. African productivity is only half that of India, one-quarter that of China and one-fifth that of the United States. The technology to increase yields is well-known but requires investments; 90 percent of Africa’s agricultural land is rain-fed and subject to the vagaries of weather. Mechanized power to till the soil would do wonders to raise yields.

Markets can only work if governments allow them to do so. In many countries, food markets are not allowed to operate freely precisely because they generate confusing price swings in the short term. Governments like to make sure that rural farmers get “fair” prices (usually meaning large public subsidies), while urban constituents get subsidized food to consume. The balance between these constituencies varies from country to country, but the large-scale presence of government intervention in food markets is common across the world. The trouble is that when food prices are volatile, government intervention becomes unpredictable in terms of its budgetary cost. When corrupt governments are faced with unaffordable food subsidies, political stability (what has been called the authoritarian bargain) is at risk. And some government interventions reinforce price swings. For example, food exporters like Russia have resorted to export restrictions when food prices rise, reducing supply on international markets. That drives up prices still further.

Many government interventions are designed to shelter local markets against volatility in the global price of food, but in fact it is precisely these national interventions that are spurring global volatility. The various border protections against the global market in place around the world segregate the world food market into a number of much smaller national markets, the exact opposite of what is needed today. If these distortions didn’t exist—in other words, if there was truly a single global market for food, and an actual “world” price of food—the volatility of prices would be much lower than the volatility in each of the protected local markets for food that we currently have.

The difficulty, of course, is that there is little incentive for any single country to liberalize its agricultural trade so long as the distortions of other countries—and the volatility in global markets they encourage—remain. And this brings us directly to the failure to complete the Doha Development Round of trade talks, which is now in its 10^th year of negotiations and has been stuck largely because of the impasse on agriculture. The ongoing failure of the Doha Round shows that the political will to take collective action to reduce food price volatility is lacking; there is no trust that the market will deliver access to food better than a government.

Politicians in developing countries care more about volatile food prices than those in developed countries because their citizens are more directly affected by the ups-and-downs of food prices. Just a few years ago, the main social issue in India was farmer suicides because of low agricultural prices. Today, it is the lack of affordability of food for the poor. In some sub-Saharan African countries, the poor might spend 70 percent of their income on food. If food prices double, these households literally become faced with the prospect of starvation. The solution: safety nets or social protection for the poor, to cushion the blow of rapid changes in food prices.

There are some drawbacks; good safety nets require effective targeting. Who should be protected? Economists might suggest the children, especially the very young, as there is ample evidence that early child malnutrition results in long-term deterioration of brain development. That line of thinking points towards subsidized school meals, or conditional cash transfer programs (sometimes means-tested, sometimes with self-selection). But politically it is the unemployed youth in urban areas that are most likely to riot. Getting cheap food to them is administratively cumbersome (government ration shops are the most common way) and normally subject to huge corruption. As a practical matter, few countries in sub-Saharan Africa actually have national social protection frameworks, although the concept of the value of social protection is now formally recognized (the African Union endorsed a social policy framework for Africa in 2009). So building social safety nets in poor developing countries remains a worthy but long-term project.

All this brings us back to where we started—big swings in food prices are happening more regularly (maybe because of climate change and the link to oil) and proving to be highly destabilizing for development and poverty reduction. The solutions lie in three areas—improving food markets and agricultural production, building political will to integrate food markets across countries, and developing social safety nets in poor countries. All are long-term projects that have been on-and-off for some years now. And because none of the challenges are being tackled with the urgency that is needed, we can expect more of the same in the years to come.

Authors

Homi Kharas

Achieving Universal Primary Education and Reducing Hunger Through School Feeding Programs

John Muntenyo — Mon, 20 Sep 2010 15:00:00 -0400

Ensuring that all boys and girls complete primary schooling is the target of the second Millennium Development Goal (MDG)—achieving universal primary education. To date, the developing world has made great strides in reaching that goal. According to the U.N. 2009 Millennium Development Goal Report, there was progress in universal primary enrollment from 83 percent in 2000 to 88 percent in 2007 in all developing countries. And according to the World Development Indicators, enrollment levels for sub-Saharan Africa rose from 58 percent in 2000 to 74 percent in 2007.

Despite these gains, there is still much more progress to be made. The major obstacle to achieving universal primary education arises from the unequal opportunities resulting from biases based on gender, ethnicity, income, language and disabilities. Children from the poorest communities and girls are the most likely to lose. One major problem in many developing countries is that school programs are underfinanced and under-sourced, and therefore they fail to deliver good quality education, which leads to dropouts. For example, the 2009 World Development Indicators find that only half of all primary school pupils in Uganda, who start primary grade 1, reach grade 5. Moreover, the survival rate to the last grade (grade 7) as percent of the cohort fell from 39 percent in 2000 to 25 percent in 2004. The situation was mirrored across other African countries.

Reasons for truancy and school dropout of children from poor households are similar across Africa and they include lack of school feeding, supplies and teachers. Other reasons stem from responsibilities at home and pressure to earn additional income. This is worse for girls who face greater pressure to help out in the home, and also face danger from pregnancy or disease from older males in the community who take advantage of them.

At the most basic level, however, African governments (with the help of the donor community) can go a long way in improving school enrollment and retention through school feeding programs. African governments should provide meals to school children from food purchased from the local communities.

In most public schools in Africa, the government does not currently provide meals to pupils. And according to the 2009 State of Uganda Population Report, about 40 percent of deaths among children are due to malnutrition, partly caused by food insecurity. The prevalence of undernourishment in the population was 15 percent in 2005, which is high by any standards. This impedes mental and physical development and impairs cognitive functions. School feeding programs can address undernourishment of children across the board, while encouraging attendance in school and reducing strain at home (less food that families need to provide). The numerous benefits from school feeding include:

1) A source of additional resources to households for consumption and investment (some form of safety net). Money saved from school feeding could lead to added household incomes (higher savings) that may then be invested in productive assets leading to higher returns.

2) An increase in time spent in school through increased enrollment, attendance and decreased dropout rates. A study by the World Food Program in Laos showed through school feeding programs, attendance increased by 5.5 percent per year, enrollment by 16 percent and dropout fell by 9 percent.

3) An increase in cognition and improved learning. According to the World Food Program, school feeding leads to an increase in cognition through test scores and an increase in wages over productive life (Kristjansson et al. 2007).

4) Improved micronutrient status and health; decreased prevalence of intestinal parasites. If children are better nourished they are accordingly less sick, which leads to better quality of life and fewer days of school missed due to illness. Studies also show that one year of additional schooling raises disease awareness (in particular related to HIV) and decreases HIV prevalence by 6.7 percent (De Walque, 2004), leading to longer life expectancy and higher productivity.

5) Multiplicative effects on future productivity and income. A World Bank report shows that every additional year of primary schooling leads to a 5 percent increase in future wages, that is, well-fed children of primary school age are healthier and more productive during their future working years. School feeding also provides multiplicative effects for the community in the form of increased future employment rates (direct and indirect), ready markets for rural famers to supply food for school meals, and increased food production and household savings.

School feeding is a unique safety net driven by the interdependence between various outcomes, and combines short- and long-term benefits from nutrition, education and value transfer. School feeding programs also go far in directly contributing to multiple MDGs in terms of reducing hunger, increasing universal primary education and eliminating gender disparity. As we approach the upcoming MDG summit, developed countries would do well to encourage and support school feeding as part of developing countries’ national strategies.

_________________________________________________

Reference:

Ahmed, A.U. (2004), “The Impact of Feeding Children in School: Evidence from Bangladesh.” Washington DC: International Food Policy Research Institute.

De Walque, Damien, (2004), How does the Impact of an HIV/AIDS Information Campaign vary with Educational Attainment? Evidence from Rural Uganda, World Bank 2004.

Kristjansson, E.A., V. Robinson, M. Petticrew, B. MacDonald, J. Krasevec, L. Janzen, T. Greenhalgh, G. Wells, J. MacGowan, A. Farmer, B.J. Shea, A. Mayhew, and P. Tugwell. (2007) School Feeding for Improving the Physical and Psychosocial Health of Disadvantaged Students. Cochrane Database of Systematic Reviews: 1

World Bank, (2009), Rethinking School Feeding: Social Safety Nets, Child Development, and the Education Sector, Washington DC.

World Food Program 2009, School Feeding: A Sound Investment

World Food Program 2009, Learning from Experience: Good Practices from 45 years of School Feeding

Authors

John Muntenyo

The Global Food Crisis: "The Silent Tsunami"

Tue, 24 Nov 2009 13:30:00 -0500

Event Information

November 24, 2009
1:30 PM - 2:45 PM EST

Falk Auditorium
The Brookings Institution
1775 Massachusetts Ave., NW
Washington, DC

Over the past five years, droughts in grain-producing nations, increased oil prices and sales of corn to produce biofuels have contributed to skyrocketing food prices and lower quantities of food reserves. Issues of food and food security differ in complexity across state, national and regional boundaries, often depending on the strength of a country’s economy and the stability of its political leadership. Climate change, greater demand from a growing world population, and the global economy and financial landscape are all factors that can shape a community’s access to safe, nutritious and affordable food.

On November 24, Global Economy and Development at Brookings hosted a discussion on nutrition, school feeding programs and food security in the developing world, featuring World Bank Group President Robert B. Zoellick; Josette Sheeran, executive director of the United Nations World Food Programme; and Samuel Worthington, president and CEO of InterAction. Homi Kharas, senior fellow at the Wolfensohn Center for Development at Brookings, gave introductory remarks and moderated the discussion.

Video

Transcript

Transcript (.pdf)

Event Materials

20091124_food_crisis

Participants

Panelists

Josette Sheeran

Executive Director
United Nations World Food Programme

Samuel Worthington

President & CEO
InterAction

Robert B. Zoellick

President
World Bank Group

The Reality of Rising Food Prices: Benefits to the Poor

Homi Kharas — Wed, 06 Aug 2008 12:00:00 -0400

Editor’s Note: The Economist challenges its readers by proposing an Oxford-style debate on important policy questions. Through a series of three statements—an opening, rebuttal, and closing—the proponent and opponent of the debate have the opportunity to argue their position and react to not only each others but also the readers’ comments and opinions. Brookings Senior Fellow Homi Kharas supported this proposition and made his case against the opposition, Dr. Joachim von Braun, Director General of the International Food Policy Research Institute. The debate was moderated by John Parker, The Economist’s Globalisation Correspondent.

To read the debate and discover the results, visit The Economist »

Images of food riots and hungry people stir deep emotions. But we must debate trade-offs: will the rise in food prices generate more food for the world and less poverty for poor people in the future?

Are today’s food prices fair to producers and consumers?

Yes, because higher food prices will bring about new investments in agriculture and higher global production. This is already happening in Asia and other parts of the world, and will accelerate over time.

Yes, because without higher food prices, land use would shift towards corn-for-ethanol and other biofuel crops and we would have less food available.

Yes, because a system with food prices in free fall for 30 years did not produce any measurable decline in hunger and poverty. But the last time food prices were as high as they are today we witnessed the Green Revolution and a rapid reduction of rural poverty in one of the largest population centres of the world, South Asia.

Yes, because the great urban/rural divide that was cleaving societies across the developing world has now narrowed.

Some have argued that the proposition is unfairly worded. As there is an upside to most things, surely food prices are no exception. I do not want this debate to be about such sophistry. Instead let us be clear about the real changes in people’s lives that can come about in the long run from higher food prices. Most of the evidence I have seen suggests that when looked at in detail, most poor people will gain from higher food prices.

Many commentators have argued that subsistence farmers do not benefit from high food prices. I presented evidence from studies on India, China and Indonesia, where the mass of humanity resides, suggesting that farmers (including the poorest of the poor) would benefit in net terms, when both income and expenditure effects are taken into account. No one has advanced any evidence to the contrary, although many choose to believe their own instincts rather than the evidence I presented. My opponent claims that millions of poor African and Asian farmers are suffering, but he has not actually challenged any of the studies I cite, nor has he presented any facts to back up his claims.

To all the sceptics who view farmers in developing countries as isolated from markets and impervious to the incentives of high global prices, I would simply refer to the comments by Dr Seck, a true expert on Africa: “The current food crisis caused by rising food prices is a unique historical opportunity for Africa to break from decades of policy bias against agriculture.” Please look at his credentials before dismissing his conclusions.

In the last analysis, almost everyone agrees that we need faster rural development to alleviate poverty and hunger. Higher farmgate prices are a key element for this to happen. One blogger commenting on this debate offered a nice example of this process at work. When Vietnam liberalised and raised rice prices in the 1990s, rural families were able to afford to send their children to school rather than having them work as farm labourers. These educated children are today fuelling Vietnam’s rapid growth. The country has seen arguably the fastest decline in poverty in history. And it started with a rise in food prices.

Several commentators have noted that high food prices are the result of misguided policies—towards ethanol, the dollar, speculators, meat eaters. Because those commentators are vehemently against the cited policies, they think all the consequences, including higher food prices, must be bad. I am not arguing that those other policies are good. I would also like to see many of them reversed. But what I am arguing is that the effects of those policies would be far worse if the market for food was not permitted to adjust through higher prices. The alternative would be food shortages and large-scale rationing. This debate is not about comparing a world of high food prices with some other idealised world which is ordered differently. The debate is about whether the rise in food prices in this messy, distorted world we live in can have some benefit for humanity. Surely yes.

To all those who bemoan the hunger and hardship that higher food prices are causing for the poor, I would simply say that a system which failed to produce any marked change in hunger and poverty over a 30-year period of price declines was not working for the poor. Give a different system a chance. If a strategy has not worked for 30 years, surely there is an upside to changing strategies.

Let there be no mistake. Our global food production system was under severe threat in the early years of this century. We needed a change. Could anything have generated a successful change to encourage more production in the absence of higher food prices? I think not.

What we are really debating is whether there is an upside to humanity from fair food prices. For years, poor farmers in developing countries have been getting short shrift, fighting competition from increasingly subsidized, mechanized farmers in rich countries. The result was a historical rise in inequality and growing urban/rural income differentials in the developing world. Now the tables are turned and there is a fairer outcome in income distribution.

Thank you to all those who have taken the time to follow this debate and enrich it through their comments. Thanks to my opponent for his enormous contributions to solving the world’s food problems, not just debating them. Thanks also to the guest commentator who has provided a voice with the weight of so much experience. And thanks to our moderator for focusing us on balance, judgment and the weight of empirical evidence, rather than on principle and emotion.

Authors

Homi Kharas

Publication: Economist.com

Reinvesting in Agriculture to Reduce Poverty

Homi Kharas — Mon, 04 Aug 2008 12:00:00 -0400

Editor’s Note: The Economist challenges its readers by proposing an Oxford-style debate on the global food crisis. Through a series of three statements—an opening, rebuttal, and closing—the proponent and opponent of the debate have the opportunity to argue their position and react to not only each others but also the readers’ comments and opinions. Homi Kharas, Senior Fellow at the Wolfensohn Center for Development, supports the proposition and makes his case against the opposition, Dr. Joachim von Braun, Director General of the International Food Policy Research Institute. The debate is moderated by John Parker, The Economist’s Globalisation Correspondent. The debate opened on Tuesday, July 29, 2008 and the winner will be announced on Friday, August 8, 2008.

To read and contribute to the debate, visit The Economist Web site »

High food prices are the result of supply being unable to keep up with demand, given today’s costly technology.

They are an easy scapegoat but are not responsible for hunger and malnutrition in the developing world.

Government interventions and distortions in food markets have been with us for decades. So have the problems of hunger and malnutrition in the developing world. During a 30-year period of declining food prices from 1973 to 2002, these problems got worse, not better, in many countries.

The prolonged period of low food prices did very little to reduce poverty and hunger, especially in Africa where it is most intransigent. According to the United Nations, more than 20% of children under five were severely or moderately underweight (the UN’s indicator of hunger) in 2000-04 in most of sub-Saharan Africa and in several countries in Asia. There has been very little progress in Africa over the last decade.

Low international food prices were partly to blame. By the mid-1990s, rice production in Africa was being outstripped by population growth. Africa had to use scarce foreign exchange to import rice and household food consumption did not grow. African conditions were not suitable for high-yielding Asian hybrids and African high-yielding varieties were not developed and distributed. African food production per head has declined by 12% since 1980.

Falling production is the inevitable response when private producers are faced with falling prices. But governments also responded by cutting their investments in agriculture. As real food prices fell from 1975 onwards, the growth rate of public investment in agriculture fell in every region in the world. The fall in developed countries was most dramatic: from 1991 to 2000 real growth was negative. In Africa in the 1990s, it averaged just 1% per year. USAID support for agricultural science in Africa has been cut by 75% over the last two decades.

In an assessment of declining African food production, Joachim von Braun’s own organisation, the International Food Policy Research Institute, singles out “poor infrastructure, high transport costs, limited investment in agriculture, and pricing and marketing policies that penalized farmers”. That is code for saying that prices were too low. Low food prices meant that rates of return on proposed projects in roads, irrigation and marketing infrastructure were too low to justify investment. Africa’s poor farmers simply could not compete when international food was so cheap.

At today’s higher food prices, which correspond to the same real level as in the 1960s and 1970s, many new opportunities present themselves. The Gates and Rockefeller Foundations created an Alliance for a Green Revolution in Africa in 2006, with significant funding to improve seeds and soil. They are trying to replicate the successful Green Revolution which helped large parts of Asia defeat hunger in the 1970s. Writing about that success, Norman Borlaug, Nobel Laureate and the father of the Green Revolution, credits the Indian government’s decision to drop price controls on food to restore market incentives to a point where farmers would rapidly introduce the new varieties. It was high food prices in the 1960s and 1970s that helped initiate and sustain the Green Revolution and there is every reason to suppose that high food prices today can serve as a prologue for a similar revolution in Africa in the years to come.

While some of the recent increase in food prices can be traced to policies like the promotion of biofuels, most of the increase is due to higher input costs and the need for more supply. My opponent notes that with rising energy prices, farmers are paying much more for fertilisers, high-yielding seeds, livestock feed and transport. He is absolutely correct, but does not take his argument to its logical conclusion. In any business, when input prices go up substantially, output prices must also rise or bankruptcy results. If we accept this argument, as I believe we must, then it is inevitable that higher food prices must accompany higher energy prices. Surely no one suggests that we should return to a world with oil prices at $20 per barrel, with the destructive effects that these have had on our environment, yet that is the only logic for those vainly wishing for a return to the low food prices of 2001.

Mr. von Braun claims that because most small farmers in the developing world are net buyers of food they will lose from higher prices. That is a static argument. It does not incorporate the supply response that would surely follow. It is also a general statement that tries to aggregate together farmers facing very different market situations. I have already cited some academic studies that model the supply response in specific country circumstances and find that in several large countries the positive supply response on incomes dominates the negative impact on consumption of higher food bills. Here is another example of academic research supporting this viewpoint. The Carnegie Endowment for International Peace released a study this year on the impact of a 50% rise in world rice prices on India. It concludes that India’s rural population of 700m would benefit from this increase. The relative income of the poorest rural households would rise by 4.5%, while the most marginalised groups, like scheduled tribes, would have a 6.4% increase in real income.

Mr. von Braun deplores the change in the status quo that higher food prices represent. The real point is that the status quo of low food prices was itself the problem. The World Bank president, Robert Zoellick, called the hunger and malnutrition goal the “forgotten MDG”, a silent tsunami that threatened humanity. Now the alarm has been rung and misguided agricultural policies are being rectified. As Paul Romer, one of the leading economists of our generation has said on another occasion, “A crisis is a terrible thing to waste”. There is every hope that changes in trade policy, investment in agriculture and more agricultural science and technology—all of which are called for by Mr. von Braun—will result from high food prices. The World Bank has already announced $350m more in agricultural support for Africa next year. As we would expect, none of this happened when food prices were low.

Authors

Homi Kharas

Publication: Economist.com