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Financial crash deepens food crisis
(China Daily)
Updated: 2008-10-17 06:59 Nearly 1 billion people went hungry Thursday as the world marked World Food Day. The global financial crisis has sent food prices soaring and pushed an extra 119 million people into hunger, meaning 967 million people are now living below the hunger line, according to Oxfam, the British-based aid and development charity said. Meanwhile, United Nations' Food and Agriculture Organization (FAO) fears Western governments embroiled in the financial crisis could cut aid to agriculture in developing countries and introduce protectionist trade measures. On Wednesday, the FAO's Director-General Jacques Diouf warned that such steps could increase the risk of another food crisis occurring next year. According to the latest issue of the FAO's Crop Prospects and Food Situation report, cereal production this year is forecast to increase 4.9 percent to a record 2.23 billion tons. However, some 36 countries around the world are still in need of external assistance as a result of crop failures, conflict or insecurity, or continuing local high prices, the report said. The great uncertainty now enveloping international markets and the threat of global recession may tempt countries toward protectionism and toward reassessing their commitments to international development aid, Diouf said. "It would be unfortunate if this were to be the case and the recently mobilized political will toward enhanced international support for developing country agriculture were to evaporate," he added. The financial crisis, following hard on the heels of the soaring food price crisis, which threw an additional 75 million people into hunger and poverty last year alone, may well deepen the plight of the poor in developing countries, he said. Commodity prices are currently dropping, mainly on expectations of favorable crop prospects but also because of a slowing world economy, among other factors. This could mean a cutback in planting followed by reduced harvests in major exporting countries. Given continuing low grains stocks, this scenario could lead to another turn of record food prices next year - a catastrophe for millions who by then would be left with little money and no credit. The impact of the financial crisis may also be felt in developing countries at the macro level, with further potentially negative effects on agriculture and food security, Diouf said. "Borrowing, bank lending, official development aid, foreign direct investment and workers' remittances all may be compromised by a deepening financial crisis," he said. Coordinated action needed Diouf said that governments and world leaders agreed at the FAO High-Level Conference on World Food Security held last June that "the international community needs to take urgent and coordinated action to combat the negative impacts of soaring food prices on the world's most vulnerable countries and populations". |
