| A Recipe for Hunger: How the World is Failing on Food |
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With a billion people living in hunger the food crisis remains an international emergency. As long as governments and international agencies do not change the economic system that has caused the crisis, it remains all too likely to continue, warns a report by the International Trade Union Confederation. ITUC Report: Global Food Crisis Set to Worsen Link to Report: A Recipe for Hunger: How the World is Failing on Food 6th April 09 ~ STWR ITUC Report: Global Food Crisis Set to Worsen 30th March 09 - International Trade Union Confederation A new report released by the International Trade Union Confederation predicts a worsening of the already serious global food crisis unless urgent action is taken by governments and international agencies. The number of people without enough to eat increased by 150 million in 2008, and the global economic crisis is likely to result in a further 200 million falling into absolute poverty. The report, “A Recipe for Hunger, How the World is Failing on Food”, targets financial speculation and massive profit-taking by a few multinational companies as the major causes, along with failed policies implemented by the International Monetary Fund and World Bank. The effects of trade rules which decrease food security and the impact of climate change are also highlighted. Another major factor, as governments and companies seek alternatives to fossil fuels, is the increase in production of biofuels at the expense of food production. “Governments are putting hundreds of billions of dollars into shoring up failed banks and finance institutions, while the World Food Programme says that all the hungry children of the world could be fed for a mere US$ 3 billion. The whole situation could be turned round for just US$ 30 billion annually,” said ITUC General Secretary Guy Ryder. “Public attention is rightly focused on the huge scale of the world economic crisis, but this should not detract from the fact that the total number of people without sufficient food is likely to reach well above 1 billion in the near future,” he added. Global food prices have fallen somewhat since their historic high in mid-2008, but they remain higher than at the beginning of last year, and global cereal prices are still 71% higher than in 2005. According to the UN’s Food and Agriculture Organisation (FAO) food crises persist in 32 countries around the world. Even as global prices have stabilized or fallen from recent peaks, this has not reached many people in developing countries, where stagnating incomes and lack of social protection mean a double burden of low purchasing power against high prices. According to Ron Oswald, general secretary of the Global Union Federation the IUF, given that 75% of the world’s poorest live in rural areas, many of those who actually feed the world are often unable to provide a nutritional diet for themselves and their families "The bulk of hunger is in rural areas, and agricultural workers are among the most food insecure. They are hungry because they are poor, and they are poor because their basic rights, including their collected rights as workers, are violated on a daily basis. Agriculture today kills, maims, poisons and pollutes the bodies and the living and the working environment of those who produce our food. Advancing the fight against hunger means advancing decent work in agriculture." Oswald added "The fact that global commodity indexes leaped 6% higher on a single day last week shows that the world’s poorest and most vulnerable remain hostage to volatile capital flows. Halting this speculation in human lives by regulating global finance and channeling these enormous sums into productive investment, including agriculture, must be at the top of G20 agenda." The new report provides detailed analysis of how the policies of the IMF and the World Bank and WTO rules have pushed developing countries into export-oriented agricultural production at the expense of domestic food security, and how the range of international agencies that have the power to deal with the problem have failed to ensure food security. Speculation on food prices has led to huge profits for a small number of extremely powerful global commodity trading companies at the expense of the poorest countries in particular, and the headlong rush to biofuel production, while providing only 1.5% of global liquid fuel supply, accounted for almost half the increase in the use of major food crops in 2006-07. “Climate-change related pressures such as floods, drought, water scarcity and poor crop yields are all contributing to the worsening of this crisis. Clearly, action on climate change is critical for future global food security, but the major causes of this crisis are due to the discredited model of globalisation which puts the market ahead of the rights and interests of ordinary people. The London G20 Summit must provide the launching pad for a complete transformation of this failed system,” said Ryder. March 09 - International Trade Union Confederation The Phenomenon Global hunger is not a new phenomenon; the world witnessed hunger and famine in almost every decade of the 20th century. Currently, more than 963 million people are malnourished and living in dire poverty across the globe. Most of them are rural and urban working poor. And yet the situation today is different in terms of its impact, ranging from poor people in developing countries who can no longer afford basic foodstuffs to workers in industrialised countries that are also feeling the effect of soaring food prices on their household budgets. Never before have so many working women and men been forced to cut back on meals, health care or other essential spending so rapidly. Because of the high prices of food, there are now an additional 150 million poor people across the globe. As the report will show, the effects of high prices of food and lack of a decent income have been felt from Europe to Africa, from Asia to the Americas – no region has been left unaffected. Over the course of 2007 and 2008, the prices of wheat and rice increased by over 70 and 130 percent respectively. Even though prices were declining slowly in early 2009, the current price level of basic food staples is still much higher than it was two years ago. The food crisis has affected everyone but most of all the worst off, those living at the lower end of the income scale who spend 50 to 70 percent of their income on food. The global food crisis has deprived them of one of their fundamental human basic rights, the right to be free from hunger and malnutrition. This report will look at the evidence at hand – the root causes of the crisis and why there are rising inequalities in the world so that while some are starving, others are reaping profits. The Sources of the Crisis The policies pursued by the international financial institutions since the 1980s have been significant in determining why developing countries cannot ensure food security for their own citizens. During the heyday of the “Washington consensus” of the 1980s and 1990s, the International Monetary Fund (IMF) and the World Bank supported market incentives by demanding that developing countries phase out agricultural subsidies that otherwise could have helped develop a strong domestic economy, and that grain buffer stocks be sold to pay off debt. A continuous and erroneous fixation on trade liberalisation as the answer to the world’s economic and social problems took focus away from the vastly underdeveloped domestic agricultural sector in developing countries. Many of those countries are now net importers of food, as opposed to their status as net exporters in the 1960s, and with the incredibly high prices of food commodities, it is clear that the policies of the IMF and the World Bank failed in their purpose. The food crisis has affected everyone but most of all the worst off, those living at the lower end of the income scale who spend 50 to 70 percent of their income on food. The global food crisis has deprived them of one of their fundamental human basic rights, the right to be free from hunger and malnutrition. At the same time, more deregulation in trade and financial markets has mainly favoured agrofood multinationals based in industrialised countries and not the working rural and urban poor across the globe. The effects of the world trade system can be seen in the large increase of import bills of low-income food deficit countries, which have more than doubled in five years. Contrary to the promises of free trade advocates, successive rounds of trade liberalisation have not ensured equity and food security for all. Much of the problem can be ascribed to the multinational corporations that control the majority of international trade in maize and other grains, as well as massive subsidies to large-scale farms in the US and Europe that deprive developing country farmers of a place in the market. Trade growth has so far brought monopolisation in world grain markets and in banana, cocoa and tea trading, which has damaged the world food system and not provided greater food security or advances in workers’ rights to a decent life. In an effort to make quick returns and seek new investment options away from the traditional stock market, investors like hedge funds have sought out the agricultural commodity market in search for high-yield gains. The massive increase in speculative investment has been a contributing factor in driving up prices of basic food staples. In a few years, investments in food commodities and futures have grown twenty-fold because deregulation has allowed noncommercial traders to seek profit gains in a relatively small market, causing sudden volatility and turmoil. Another part of the problem is that the world is getting more populous. By 2050, more than 9 billion people will inhabit our globe. The strain on food availability is estimated to rise in the future but already, as the middle classes in developing countries like China and India grows and their blossoming economies allow them to shift their eating patterns, pressure on water accessibility and grain production is rising because meat and dairy products are in higher demand than ten years ago. Climate change will make matters worse: recurring droughts, flooding and other climate change-related pressures resulting from increased greenhouse gas emissions are a global challenge. Climate change disasters occur most often in developing countries where failed harvests and poor crop yields can result in people going hungry for months because the working poor can no longer afford to purchase basic foodstuffs at new and higher prices. As the impact of climate change intensifies over the coming decades, changes in weather patterns will continue and food production will be put under even more pressure. However, climate change cannot be tackled through simplistic advocacy of biofuels without concern for their side-effects. While the production of organic material for biofuels has diverted large amounts of food crops into the fuel tanks of cars, it has only accounted for 1½ percent of global fuel supply. The Solutions The first priority in alleviating this crisis must be to ensure food security in all countries so that rapid and secure food supplies can be guaranteed for those in need. Only by ensuring economic safety mechanisms that with certainty can reach the poorest people, the unemployed, waged workers and vulnerable groups such as women can the international community prevent the financial and economic crisis from worsening an already grim situation. This means that the more than 70 developing countries already experiencing problems with their balance of payments because they are struggling to pay their import bills for essential food staples require help. Financial assistance must be granted but without the same, failed policy conditionality from the international financial institutions. The policies that contributed to the creation of this crisis cannot be a part of the solution. Another immediate action should be eliminating politically supported subsidies that boost biofuel production while diverting food crops into fuel, as biofuel production is heavily subsidised by industrialised countries and as a result, biofuels are estimated to account for at least 30 percent of recent food price rises. Furthermore, more effective regulatory mechanisms are needed in the agricultural commodity and futures markets, to limit and contain the speculation that helped drive up food prices during 2008. In the longer run, investment in rural infrastructure must be increased in developing countries. Assistance to small-scale agricultural production in developing countries would contribute to enabling the world to restore the supply-demand balance for food at a lower price level. Such assistance must take place under the right terms to achieve economic, social and environmental sustainability including decent work and respect for international labour standards for rural workers. The production of foodstuffs in developing countries for domestic consumption at accessible prices is essential in ensuring domestic food security and reducing poverty, by providing some security against escalating world prices for basic commodities. The provision of universal social protection, which the ILO is currently implementing a major campaign to achieve, is another part of the international framework for combating hunger. The above combination of recommendations shows that there is no one, magic solution to the global food crisis. Yet governments must accept their role. They are failing when more than 963 million people are living in hunger and the number of poor people increases by more than 150 million in one year due to high food prices. In today’s interdependent world, that is not acceptable. The international community must accept its joint responsibility to deliver an effective right to food for all the world’s citizens. Financial assistance must be granted but without the same, failed policy conditionality from the international financial institutions. The policies that contributed to the creation of this crisis cannot be a part of the solution. Link to STWR's key facts page on Food Security and Agriculture |
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