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Policy Brief
High Food Prices
The What, Who, and How of Proposed Policy Actions
Joachim von Braun with Akhter Ahmed, Kwadwo Asenso-Okyere, Shenggen Fan, Ashok Gulati, John Hoddinott, Rajul Pandya-Lorch, Mark W. Rosegrant, Marie Ruel, Maximo Torero, Teunis van Rheenen, and Klaus von Grebmer
May 2008
Executive Summary

The complex causes of the current food and agriculture crisis require a comprehensive response. In view of the urgency of assisting people and countries in need, the first set of policy actions—an emergency package—consists of steps that can yield immediate impact:

  1. expand emergency responses and humanitarian assistance to food-insecure people and people threatening government legitimacy,
  2. eliminate agricultural export bans and export restrictions,
  3. undertake fast-impact food production programs in key areas, and
  4. change biofuel policies.

A second set of actions—a resilience package—consists of the following steps:

  1. calm markets with the use of market-oriented regulation of speculation, shared public grain stocks, strengthened food-import financing, and reliable food aid;
  2. invest in social protection;
  3. scale up investments for sustained agricultural growth; and
  4. complete the Doha Round of World Trade Organization (WTO) negotiations.

Investment in these actions calls for additional resources. Policymakers should consider mobilizing resources from four sources: the winners from the commodity boom among countries; the community of traditional and new donor countries; direct or indirect progressive taxation and reallocation of public expenditures in the affected countries themselves; and mobilization of private sector finance, including through improved outreach of banking to agriculture.

Because of countries' diverse situations, the design of programs must be country driven and country owned. Accountability for sound implementation must also rest with countries. At the same time, a new international architecture for the governance of agriculture, food, and nutrition is needed to effectively implement the initiatives described, and especially their international public goods components. Global and national action is needed, through existing mechanisms, well-coordinated special initiatives, and possibly a special fund.

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Authors

Joachim von Braun is director general of IFPRI.
Akhter Ahmed is a senior research fellow in the Food Consumption and Nutrition Division of IFPRI.
Kwadwo Asenso-Okyere is director of the ISNAR Division.
Shenggen Fan is director of the Development Strategy and Governance Division.
Ashok Gulati is director in Asia of IFPRI (New Delhi).
John Hoddinott is deputy director of the Food Consumption and Nutrition Division.
Rajul Pandya-Lorch is head of IFPRI's 2020 Vision Initiative and chief of staff, Director General's Office.
Mark W. Rosegrant is director of the Environment and Production Technology Division.
Marie Ruel is director of the Food Consumption and Nutrition Division.
Maximo Torero is director of the Markets, Trade, and Institutions Division.
Teunis van Rheenen is IFPRI's coordinator for Partnerships and Impact Assessment.
Klaus von Grebmer is director of the Communications Division.

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I am yet to read your full report. But your two recommendations viz 1.change biofuel policies and 2.complete Doha rond on agriculture are in fact mutually conflicting. Didn't we want developed world to remove their subsidies on food grain production so that developing countries like India would then benefit from the resulting high food grain prices. So the same has in fact been achieved now by encouraging biofuels.

Overall, the process of cutting through of market has to be closed, if long-run economic development of farm-poors are to be realized. The fatiqueness of technology obsevations have to be accepted. Over all policy may call for supply-side constraints. The issues and agendas suggested for, seems appear very responsive to the situation at macrolevel.

When crisis strike, as Nobel Laureate Harberger has often advised, changes are possible. Your well articulated position leads to those changes. In future, the accelerated agricultural development of former major suppliers: the vast expanses in Central and Eastern Europe and the Commonwealth of Independent States.

Of course, you miss a major point: what lessons have been learned by those involved in R&D, agricultural knowledge outreach, and trade support. Many donors have been funding new ventures in agricultural trade while ignoring the basic staples consumed by the local population. Was this a sin of omission or commission? Were they bounded by constituencies opposed to such initiatives? Was the US agricultural development shaped by the USG policy of first pushing hybrids (vs open pollination) and more recently molecular breeding? The recently approved farm bill seems to reaffirm yesterday's "values." If such were the case, a repeat of past measures may only yield similar results.

Leadership moves, but management accomplishes. A more rigorous application of performance based programs, based on impartial tracking, monitoring and evaluation which informs transparent accountability, will benefit all but those who fail. As a former executive in the aid industry, many agricultural programs--from R&D to the market, from lab bench through field to fork, absorbed valuable resources and delivered poor results...and they continued to be funded. The sacred cows so honored kept controlling resources that should have gone to fresh initiatives and more promising agents. Like the dog in the manger,(i.e. neither delivering results nor allowing others to do so) this skewed performance sapped commitments to agricultural programs.

Congratulations. Let's hope the Harberger principle and works like yours empower wise decision makers and allow them to launch measures leading towards a more equitable, healthy, peaceful and prosperous global food system.

fmanteiga@gmail.com
May 20, 2008

I am writing my magnum opus on the Egyptian Village and have recognized the tragedy of increased food prices in rural Egypt. More than half of the population in rural Egypt is dependent on non farm income and these increases have been devastating.

I look forward to reading Dr von Braun's et al. program/study James Mayfield Professor Emeritus University of Utah.

How can we consider your recommendations credible when you omit any mention of the promise of biotechnology to increase yields and nutrition in developing countries

websterj@aol.com
May 20, 2008
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