In this Zunia interview, Director General of the International Food Policy Research Institute (IFPRI) Mr.Shenggen Fan talks about different issues of food security and food policy.
Zunia: Food security is at the top of all agenda in the upcoming Rio+20 conference. From a realist’s point of view, what kind of tangible outcomes would you expect from Rio+20 in terms of food security?
Mr.Shenggen Fan: In the face of 900 million hungry people in the world and more than 2 billion people suffering from micro-nutrient malnutrition, promoting food and nutrition security is a must in a green economy.There is no doubt that poor management and increasing scarcity of natural resources make the provision of adequate food increasingly difficult.Therefore it is paramount to pursue sustainability goals while promoting food security and economic growth.
From Rio+20 I expect that policies are agreed upon that help exploit the synergies among food security, agriculture, natural resource management, and economic growth. Following an integrated approach will avoid solutions with adverse consequences for any one sector. In agriculture, such “win-win” situations can be achieved through practices that reduce negative environmental effects while increasing productivity and smallholder incomes.
To reflect the value of natural resources, the cost of environmental degradation as well as the benefits of ecosystem services should be taken into account by decision makers. Likewise, the prices of food and natural resources must include their social and environmental costs and benefits to send correct signals to all actors along the whole supply chain. This can be achieved through taxation, regulation, and economic incentives. In addition, open trade helps optimize resource allocation.
Many developing countries lack the capacity to design and implement strategies for agricultural development and food security that also protect natural resources at the same time. Greater technical and financial support should be allocated toward establishing institutions that have this capacity. New mechanisms and indicatorsmust be set up to monitor and evaluate the impacts and implications of related policies. For a green economy these still need to be identified.
Finally, Rio+20 must engage multiple stakeholders: Smallholders have a central role in food production, the public sector has a role to play in addressing market failures, and the private sector can provide investment, expertise, and innovation to help enhance food and nutrition security in developing countries.
Zunia: These days, Arab countries are also facing a serious food security challenge. A recent study in Egypt calculated that an anticipated 30 percent increase in food prices would result in a 12 percent increase in poverty levels. What kind of practical measures can be taken to tackle food security challenges in Arab nations?
Mr.Shenggen Fan: Analyses by IFPRI researchers have shown that many Arab countries have a high risk of food insecurity, both at the national and household level. However, the problems in the region are not limited to food security issues alone but include long-standing factors ranging from youth unemployment to growing income disparities. Therefore Arab countries have to pursue more inclusive development strategies in general.
To improve household food security, governments in the region will need to adopt policies that stimulate inclusive growth, such as employment generation. In particular, smallholder agricultural growth in some of the Arab countries has a large potential for reducing food insecurity.This can be promoted by investing in agricultural research, rural infrastructure and water-efficient irrigation. In the meantime social safety nets are another measure to protect the vulnerable.
To improve food security at the country level, export-led growth that generates foreign exchange revenues and appropriate tax systems that generate government revenues can help pay for food imports and for social security.And regional emergency grain reserves should be set up to help the poorest during crises
Zunia: Political support and financial investments in the biofuel industry is blamed to be a key driver of global food price hikes. The Global Hunger Index was certainly in no doubt and blamed the heavily subsidized US corn-for-ethanol industry for the rising food prices of the last few years. How would you characterize the effects of biofuel industry in global food security?
Mr.Shenggen Fan:Producing bioenergy from food crops increases global food prices. This is also true if biofuel crops are grown instead of food crops; this competition for land is known as “land-use change”. Higher food prices can benefit farmers who produce a crop surplus that they can sell, but only as long as the higher profit they achieve for their output is not offset by increased input or transportation costs. However, most of the poor and food insecure are net buyers of food, and this includes many smallholders in developing countries. Therefore higher foods prices and by extension current grain based biofuels are detrimental to global food security.
One way to address this negative impact of the biofuel industry on global food security is the promotion of second-generation biofuels, i.e. biofuels that are made from nonfood feed stocks such as agricultural residues and switch grass.
Zunia: How feasible is it to believe that national food security policies can be designed to be more compatible with global open market policies while securing interests of local farmers and equitable access to food at the same .
Mr.Shenggen Fan: Open markets and open trade are very much in the interest of smallholder farmers. To move out of subsistence agriculture, smallholders need to be able to participate profitably in markets. However, integrating them into supply chains will require the identification of existing bottlenecks, and innovative institutional arrangements and investments in rural transportation and communication will have to be made. Arrangements such as group lending, producers’ associations, and contract farming have been shown to help smallholders increase their bargaining power, improve their access to price information, facilitate their integration into markets and supply chains, and lower transaction costs and price risks.
In order to reduce food price volatility and enhance the efficiency of agricultural markets,governments should ensure transparent, fair, and open global trade and eliminate harmful trade restrictions. In particular OECD countries should also remove subsidies that are directly or indirectly linked to food production as they distort trade and adversely affect smallholders’ income in developing countries.
Shenggen Fan has been Director General of the International Food Policy Research Institute (IFPRI) since 2009.He received a PhD in applied economics from the University of Minnesota and bachelor’s and master’s degrees from Nanjing Agricultural University in China.
Dr. Fan is a member of the World Economic Forum’s Global Agenda Council on Food Security, as well as an Executive Committee member of the International Association of Agricultural Economists. He currently serves on the editorial boards of Food Policy and the Journal of Chinese Rural Economy.