In the last decade, the explosion in population, accelerated urbanization and income growth have become unsustainable. They are generating growing and competing demands on food, notably animal proteins, and on natural resources such as soil and water as well as the wider environment. The amount of rich arable land for cultivation is diminishing, fossil (non renewable) acquifers are being depleted and desertification is spreading. At the same time, one is amazed to find that investment in agricultural research has been scaled down, average crop productivity growth has halved, and part of the benefit of staple food production has been shifting from people to cars via biofuels. This has resulted in price increases and environmental stress and leads one to ask the question how we can respond effectively to achieve both food and environmental security in the 21st Century. I believe that this requires a new approach to meeting the demands of a growing population for safe, affordable and nutritious food which needs to be produced without damaging the environment.
Delegates to the recent Brussels Conference on the future of agriculture (27 March 2008), organised by Syngenta and the European Landowners’ Association (ELO) appeared to agree, with well over 80% supporting the need for a new approach to food and environmental policy in the European Union (EU). Delegates also agreed with the central tenet of Franz Fischler’s Reform of the Common Agricultural Policy (CAP) – that food and environmental security are not mutually exclusive concepts but are actually inter-related. But it would appear that achieving food and environmental security perhaps poses the biggest challenge the world has faced in its effort to sustain man and delegates argued that this requires a coordinated public and private sector response (which includes CAP) that must be actively pursued by both developed and developing countries.
The food security challenge
The focus on food security must look beyond the traditional sense of self-sufficiency to a broader definition of a human being’s right to to nutrition, which is the first of all human rights. Ensuring that there is enough food on the table of their people is the first obligation of all governments, regardless of how much food they produce, import, or export. The new United Nations (UN) Special Representative for the Right to Food, Olivier De Scutter, has sensibly called for a special session of the Court of Human Rights to be devoted to food.1
The belief that one can cater for the world’s food needs merely by pursuing CAP reform, forcing the United States (US) to change its own farm policy and liberalizing world farm trade is simplistic and deceptive. Unfortunately it is held by key World Trade Organisation (WTO) negotiators who are still fighting yesterday’s battles while the world has moved on since the Doha Declaration. Tomorrow, we will have to care less about opening food markets and more about securing food supplies. Food availability is too important a subject to be entrusted solely to trade experts with little knowledge of the multifunctional nature of agriculture and or any substantive qualification in food production.
The main problems with feeding the world have less to do with trade than with other factors. The main ones are demography and urbanization, with a population the size of Germany’s added to the world population every year. At the same time, we see an increasing number of people concentrated in urban areas. For example, the urban share of the population has increased from 10% in 1900 to more than half today (from 150 million to 3000 million). According to the Food and Agriculture Organisation (FAO), the exploding population also means that whilst one acre of land was enough to feed two people in 1960 – by 2025 the same area will need to feed five people. This is the scale of the challenge we face. These factors, together with many others have outstripped the growth in land utilization and technological developments.
The claim that agricultural production and export subsidies in developed countries have allowed them to export at low prices is tenable, but the inference that this has been the main cause of low domestic food production prices in poorer countries is way off. Without such subsidies, it can be shown that world agricultural food supplies would have been lower and hence food prices higher. While a few developing countries (Latin America) would have benefited from higher world food prices, the vast majority of net-food importing developing countries would have suffered from them. The latter’s capacity to produce food was not so much limited by low world food prices as by a lack of production structures and by domestic agricultural policies penalizing home producers and favouring export crops. This is why Mr. De Schutter was right when he advocated that developing countries should introduce policies on the CAP model in order to boost domestic food production.
In order to ensure food security and thereby stay in power, the main concern of poor country governments is still, and increasingly so, to keep domestic food prices as low as possible, so as to try to please their (voting) urban population; they do this, not only by fixing low domestic prices (regardless of world prices)2 , but also by reducing food import duties, establishing or increasing food consumer subsidies, and supporting domestic production. This can be done by subsidizing agricultural implements or inputs (such as seeds, water, fertilizers, or plant protection products), but unless effective production structures and policies are in place this often results in increased public budget deficits and international indebtedness. Food security is important even to governments of traditional food exporting countries, some of whom keep domestic food prices lower than food export prices (taxes included). These governments have indeed shown a disposition to impose restrictions such as export taxes or outright export bans for fear of running out of food.
Food supply concerns are legitimate, but the kind of food security policies described above are the wrong way to go. They smack of autharky, and are more often than not counterproductive: they may feed speculation, lead to hoarding or smuggling, boost prices even further, make markets less predictable, discourage production and investment, and have contradictory effects.
Backgroud about the interviewee:
Corrado Pirzio Biroli, Chief Executive of the RISE Foundation and Chief of Staff to former EU Agriculture Commissioner, Franz Fischler, talks about the current crisis in world food supply and the necessary response.
Food security is therefore at risk of becoming the next serious market failure after climate change, which Nicholas STERN has described as “the biggest market failure in history”, unless agricultural policies of both developed and developing countries are reformed further. As the media tend to focus on the former, I will concentrate here on the latter.
The response of developing countries
Developing countries should adopt pro-active policies such as raising domestic farm gate prices, if necessary adding basic subsidies (decoupled from production), advising farmers to plant genetically modified drought-resistant crops providing higher yields and water savings, and taking any other (environmentally friendly) measures suitable to encourage their own farmers to produce more food, and possibly build up national food stocks. Export restrictions should instead be discouraged, because they lower world food supplies and raise world prices.
This is easier said than done. One cannot turn a blind eye to the double challenge of keeping domestic farmers in business and at the same time ensuring that food supplies are sufficient at acceptable prices to urban dwellers, particularly where there are serious budgetary constraints. Nor can one ignore the natural inclination of all governments to leave intractable problems (hot potatoes) to their successors, penalizing the least influential sectors. After all, according to the World Bank, we can expect about 33 countries this year alone to face political crises and/or social strife because of food shortages.
Instead of blaming developing countries’s current food policies, the richer ones (apart from adapting their own food-related policies) should help them enter a virtuous food circle. The market needs coordinated direction as to what kind of policies regarding soil use, energy, water, transportation, environment, and indeed agricultural and rural development, are the most appropriate ones to tackle the world’s overall socio-economic and political security requirements, foremost among them food in the developing countries. What happens there will have a much greater impact overall than what happens in the advanced industrial countries.
Faced for a long time with large food market manipulation by governments and enterprises, there is an urgent need to deal with the matter in the appropriate fora besides the WTO, and seek appropriate solutions to to-day’s biggest challenge: world food supply.
The role of developed nations
As humanity faces the biggest food crisis since the World War II, richer countries, including the oil exporters, should help net food (and energy) importers as they did with the emergency balance-of-payments support for the Most Seriously Affected Countries (MSA) in 1975, by providing the financial means necessary to limit famine and environmental stress, thereby preventing growing indebtedness (which would have to be partly forgiven). The high income countries, including the oil producers, should boost overseas development assistance to sustainable food production and water, promote the creation of a world food stock to combat or limit speculative food price hikes and cater for food emergencies in the future and limit price peaks, boost research in agriculture, reverse the underinvestment of Overseas Development Assistance (ODA) in agriculture for the last 20 years ($1bn annually), and make ODA, including food aid conditional upon agricultural reforms. At the same time, the rich countries should rapidly abolish their subsidies for inefficient biofuel production, because they represent “a crime against humanity” (UN Special Representative J. Ziegler) withholding food from the hungry without any net emission savings.
The role of technology
As to technology, it has an essential role to play regarding both food and the environment. New technologies capable of raising land productivity are shrinking and whilst there is still significant value to be captured in increasing yields of crops such as wheat, rice, and corn in certain parts of the world, they will eventually press against the ceiling imposed by the limits of photosynthetic efficiency.
The most promising contribution in this area can be expected from biotechnology, provided public opinion is prepared to support it. Current negative attitudes in Europe will need to change as the next GMO generation comes on stream. But this new technology should of course not be introduced without exhaustive impact assessment and excellent stewardship. On the other hand, caution is also of the essence in dropping any technology (including plant protection products) without judgment as to whether the pros outweigh the cons, and whether there are alternatives in the pipeline, or when they could be expected.
These technologies also need to be used responsibly and safely by farmers around the world and initiatives such as the Stewardship Community website will play a key role in enabling farmers to learn and share best practice.
Addressing the demand side factors
But we should be cautious about putting too much capital in the belief that technology alone will allow us to ensure sustainable world food production for all and reduce world hunger in accordance with UN targets, or stop, let alone reverse climate change. Technology primarily addresses the supply side. There will be no solutions without acting on the demand side as well, notably western life-styles and their impact on food demand (in particular beef) and the environment. Here too the lead must be provided by the higher-income countries. It is in fact inconceivable to tell the developing countries that catching up with western life-styles, notably, in the consumption of meat and use of modern transport, is not credible unless the West does its part to limit consumption so that others can catch up at lower levels.
Where does this leave EU farmers?
Farming is fundamental to society, but more complex than any other activity. But EU farmers must wonder how they can be expected to contribute to satisfy world food demand, save energy and water, and preserve the environment, all at the same time, when farm payments and public support are on the down path (even if average long-term food prices remained high).
Weakening, let alone scrapping the CAP, as a growing number of people advocate, would involve a number of risks, and actually mean throwing out the baby with the bath water. The risks include: production intensification with increased pollution, land abandonment with rural desertification and reduced farm output, accelerated urbanization with additional infrastructural and environmental costs and loss of agricultural land, potential difficulties for the Internal Market, higher world food prices with serious humanitarian, economic and political consequences, in particular for the poor at home and for the net- food-importing developing countries.
However, the status quo is not an option. The CAP reform process is not quite over yet.. Substantial investments will be needed to help respect cross-compliance rules and make farming more sustainable dealing with the negative externalities of production such as water pollution, promoting organic farming, adopting new, expensive technologies at an early stage, and rewarding farmers for the actual delivery of public goods, including the preservation of extensive farming. A real shift in CAP support towards rural development is of the essence. The CAP must substantially increase its assistance to the multifunctional tasks of European agriculture so as to provide the services to society that the market does not pay for.
All other countries in the world are also called upon to restructure their agricultural policies, so as to sustainably produce enough food, and open their markets step by step. The EU has shown the direction, others have not done so yet, in particular the US and the developing countries.