Beneath The Surface
Dealing with agricultural disarray
Long ago, D. Gale Johnson discovered "disarray" in world agriculture fraught with misalignments and missing markets. After many years of relative calm, a quiet journey towards feeding the world population at a reasonable price, agriculture seems to be back to the border of disarray. The costs of the conundrums are well documented. Food prices shot up suddenly at an exorbitant rate. Since the poor tend to spend about two-thirds of their total income on the purchase of food, they were the worst victims of the crisis with debilitating effects on their consumption of non-food items.
Demonstrations and social unrest have already crippled some of the capital cities. International agencies have come forward with more aid commitments. But all said and done, the sustainability of the system itself is now seriously threatened, if not thwarted.
Causes of conundrums
Many experts now see the current world food and agricultural policy system itself in disarray. We can refer the readers to the opinions of two eminent economists, Joachim von Braun and Nurul Islam (respectively, director general and emeritus senior research fellow of IFPRI) who succinctly summarise the symptom of such disarray: incoherent or inadequate response to exploding food prices, the slowdown in agricultural productivity growth; looming water problems, a disorderly response to higher energy prices, rapid concentration in multinational agribusiness corporations without necessary institutional innovation to guide them, lack of progress in addressing scarcity, adverse impacts of climatic change, widespread nutritional problems including hunger, obesity and chronic diseases, and agriculture-related health hazards such as avian influenza. Finally, adding fuel to the fire was under-investment in public goods related to food, nutrition and agriculture, such as rural infrastructure, agricultural research, and rural institutions, which have spillover effects and global impacts. Coping with crisis
Joachim von Braun and Nurul Islam consider national agricultural policies as central but, in the same breath, call for collaborative actions among countries for adequately addressing opportunities and challenges. Especially poor nations have already had a pinch of populist national policies pertaining to agriculture in general. In a global regime, autarkic position barely brings benefits, either to the nation concerned or to the world at large. It is, thus, not surprising that the cost of bio-fuels is being borne by the Bangladeshis living thousand of miles away from the producers and users of such fuels. For example, according to Joachim von Braun, about 30% of US maize production will go into ethanol in 2008, rather than into world food and feed markets. This will push up food prices. Oil price is a case in point. Energy and agricultural prices are interwoven: a rise in the former causes the latter to rise through affecting costs of production. Similarly, the inward looking strategy of rice exporting countries is forcing the importers for import substitution on a large scale. Now, seemingly, every country is planning to produce everything with a distinct disrespect to Ricardo's theory of comparative advantage. By and large, Gale Johnson's "disarray" appears to have appeared in a new guise! Hence, the writers' vision of designing a global governance system for food, nutrition, and agriculture seems to suit the time. In addressing the current conundrums, the authors appear to suggest three options -- though not mutually exclusive, and could range from realistic to utopian. The first -- and possibly the most realistic -- option is to make marginal improvements on the current institutions. This means, strengthening UN and CGIAR systems in terms of their effectiveness, their governance and their resources. The second realistic line is to form an innovative government network that would strengthen government-to-government systems for decision making in the area of food and agriculture through a set of agreements and conventions. A third option is to expand the current system to explicitly engage the new players in the global food system -- the private sector and civil society, including large private foundations -- together with national governments in new or significantly reorganised international organisations and agreements. Given the fact that the global food system is in reality no longer governed only by governments, this inclusive approach seems worthwhile now. Changing the global system
The offshoot of the discussion is that the existing global system has developed many cracks over the years and, therefore, is not fit to face the foray. It needs an overhauled structure "to quickly come closer to a world that sustainably provides each person with enough food to live a healthy and productive life as envisioned in the Millennium Development Goals." The options could be used in combination and, if necessary, a superstructure could be established (for example a panel appointed by UN leadership) to guide changes in the global governance of agriculture. In this new structure, sufficient space should be created for newly emerging players in the food markets, such as Brazil, India China and others. By and large, the old order should pave the way for a new world order. New wine in old bottle?
But there is a million-dollar question looming large on the horizon. In the past, distortions created by the agricultural policies of the developed countries went a long way in putting the world agriculture in peril. The negotiations in the WTO failed because of heightened heavy-handedness of these nations. Could a newly created superstructure achieve what WTO has failed to do so far? The political economy of the "disarray," and the superstructure that will go along to heal it, hold no less importance than the naïve options of eminent economists. Keeping this in mind, continuation of dialogues among stakeholders can be considered only as a necessary condition. Abdul Bayes is a Professor of Economics at Jahangirnagar University.
Many experts now see the current world food and agricultural policy system itself in disarray. We can refer the readers to the opinions of two eminent economists, Joachim von Braun and Nurul Islam (respectively, director general and emeritus senior research fellow of IFPRI) who succinctly summarise the symptom of such disarray: incoherent or inadequate response to exploding food prices, the slowdown in agricultural productivity growth; looming water problems, a disorderly response to higher energy prices, rapid concentration in multinational agribusiness corporations without necessary institutional innovation to guide them, lack of progress in addressing scarcity, adverse impacts of climatic change, widespread nutritional problems including hunger, obesity and chronic diseases, and agriculture-related health hazards such as avian influenza. Finally, adding fuel to the fire was under-investment in public goods related to food, nutrition and agriculture, such as rural infrastructure, agricultural research, and rural institutions, which have spillover effects and global impacts. Coping with crisis
Joachim von Braun and Nurul Islam consider national agricultural policies as central but, in the same breath, call for collaborative actions among countries for adequately addressing opportunities and challenges. Especially poor nations have already had a pinch of populist national policies pertaining to agriculture in general. In a global regime, autarkic position barely brings benefits, either to the nation concerned or to the world at large. It is, thus, not surprising that the cost of bio-fuels is being borne by the Bangladeshis living thousand of miles away from the producers and users of such fuels. For example, according to Joachim von Braun, about 30% of US maize production will go into ethanol in 2008, rather than into world food and feed markets. This will push up food prices. Oil price is a case in point. Energy and agricultural prices are interwoven: a rise in the former causes the latter to rise through affecting costs of production. Similarly, the inward looking strategy of rice exporting countries is forcing the importers for import substitution on a large scale. Now, seemingly, every country is planning to produce everything with a distinct disrespect to Ricardo's theory of comparative advantage. By and large, Gale Johnson's "disarray" appears to have appeared in a new guise! Hence, the writers' vision of designing a global governance system for food, nutrition, and agriculture seems to suit the time. In addressing the current conundrums, the authors appear to suggest three options -- though not mutually exclusive, and could range from realistic to utopian. The first -- and possibly the most realistic -- option is to make marginal improvements on the current institutions. This means, strengthening UN and CGIAR systems in terms of their effectiveness, their governance and their resources. The second realistic line is to form an innovative government network that would strengthen government-to-government systems for decision making in the area of food and agriculture through a set of agreements and conventions. A third option is to expand the current system to explicitly engage the new players in the global food system -- the private sector and civil society, including large private foundations -- together with national governments in new or significantly reorganised international organisations and agreements. Given the fact that the global food system is in reality no longer governed only by governments, this inclusive approach seems worthwhile now. Changing the global system
The offshoot of the discussion is that the existing global system has developed many cracks over the years and, therefore, is not fit to face the foray. It needs an overhauled structure "to quickly come closer to a world that sustainably provides each person with enough food to live a healthy and productive life as envisioned in the Millennium Development Goals." The options could be used in combination and, if necessary, a superstructure could be established (for example a panel appointed by UN leadership) to guide changes in the global governance of agriculture. In this new structure, sufficient space should be created for newly emerging players in the food markets, such as Brazil, India China and others. By and large, the old order should pave the way for a new world order. New wine in old bottle?
But there is a million-dollar question looming large on the horizon. In the past, distortions created by the agricultural policies of the developed countries went a long way in putting the world agriculture in peril. The negotiations in the WTO failed because of heightened heavy-handedness of these nations. Could a newly created superstructure achieve what WTO has failed to do so far? The political economy of the "disarray," and the superstructure that will go along to heal it, hold no less importance than the naïve options of eminent economists. Keeping this in mind, continuation of dialogues among stakeholders can be considered only as a necessary condition. Abdul Bayes is a Professor of Economics at Jahangirnagar University.
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