UN: GLOBAL FOOD CRISIS NOW AN EMERGENCY
UNITED NATIONS, APRIL 16, 2008 (STAR) UN Secretary-General Ban Ki-moon warned yesterday that the rapidly escalating global food crisis has reached emergency proportions and threatens to wipe out seven years of progress in the fight against global poverty.
In the Philippines, which experts warn could be among the worst hit by the food crisis, the government is monitoring retail outlets amid reports that prices of canned food including sardines and corned beef are also increasing.
Ban called for short-term emergency measures in many regions to meet urgent food needs and avoid starvation and longer-term efforts to significantly increase production of food grains.
The “international community will also need to take urgent and concerted action in order to avoid the larger political and security implications of this growing crisis,” Ban told international finance and trade officials at a UN meeting following their weekend talks in Washington.
“The UN needs to examine ways to lead a process for the immediate and longer-term responses to these global problems,” he said.
The secretary-general echoed World Bank President Robert Zoellick’s appeal to governments on Sunday to quickly provide the UN World Food Program with $500 million in emergency aid it needs by May 1.
Zoellick said the international community has “to put our money where our mouth is” to deal with rapidly rising food prices that have caused hunger and deadly violence in several countries.
Ban said the recent steep rise in food prices “has already raised the cost of WFP’s needs to maintain its current operations from $500 million to $755 million.”
WFP, the world’s largest humanitarian agency, issued an “extraordinary emergency appeal” to donor countries for $500 million last month, saying the money was needed by May 1 to avoid cutting rations to some of the world’s most impoverished regions. The Rome-based agency said its funding gap was growing weekly.
“The rapidly escalating crisis of food availability around the world has reached emergency proportions,” Ban said.
UN humanitarian chief John Holmes was more cautious in his assessment.
While the world should recognize that “it’s a very serious problem which has global ramifications,” Holmes said “I think we should be a little bit careful of being too alarmist about it and suggesting there are mass problems around the corner, or that it’s a global emergency we have to solve with every detail tomorrow.”
The international community is still grappling with the number of people affected, how many face malnutrition or food insecurity, and the potential cost.
“I would call it a global food price crisis for the moment ... which is having knock-on effects in other areas,” Holmes said.
It is driven by rising demand and there also appears to be speculation in commodities that is behind some of the recent price rises, he told a news conference.
He stressed that the $500 million sought by WFP “does not cover any new needs that might arise from price rises ... or if the number of desperately hungry people in a country doubles, for example.”
Ban noted that “the World Bank has estimated that the doubling of food prices over the last three years could push 100 million people in low income countries deeper into poverty.”
He echoed Zoellick in warning that the food crisis “could mean seven lost years in the fight against worldwide poverty.”
The United Nations is at a mid-point in its campaign to reduce global poverty and improve living standards of the world’s bottom billion. The Millennium Development Goals, adopted at a UN summit in 2000, include cutting extreme poverty by half by 2015.
Mexican finance official Ricardo Ochoa, speaking on behalf of the World Bank’s Development Committee, said many countries are on track to meet the poverty goal but not most of sub-Saharan Africa – and he called for “stronger, sustainable and more equitable growth.”
Philippe Douste-Blazy, the secretary-general’s special adviser on innovative ways to finance development, called for more “global brainstorming,” saying one idea being explored would tax stock transactions around the world.
Ochoa noted that the impact of higher commodity prices has been mixed, depending on whether countries are net exporters or importers.
“Within countries, large groups of poor people are severely affected by health, food and energy prices across the developing world,” he said.
The Development Committee urged the World Bank group and the International Monetary Fund “to provide timely policy and financial support ... to countries dealing with negative shocks including from energy and food shortages,” Ochoa said.
IMF Deputy Managing Director Murilo Portugal said that since the last meetings of the fund and bank in October, “global financial instability has increased, world economic growth has slowed, and the growth prospects for this year and next year have deteriorated.”
“Inflation risks from higher food, energy and commodity prices have also risen,” he said.
“Emerging markets and developing countries have continued to show resilience in the face of this ongoing financial crisis, but their growth prospects have also moderated, and inflation risks have increased,” Portugal said. “For many countries, containing inflation and addressing vulnerabilities will remain a key priority.”
DTI to monitor retail prices
The Department of Trade and Industry (DTI) vowed yesterday to strictly monitor retail prices in the country as the prices of canned sardines and corned beef have also increased.
The price hike was brought about by the rising cost of tin cans used for sardines and corned beef.
“We assure the public that the Price Act will be strictly enforced during the course of our monitoring activities,” Trade Secretary Peter Favila said.
“We want to prevent unscrupulous retailers from raising their prices out of mere speculation so that the consumers do not have to pay more than what is due,” he said.
The move was made in response to the announcement of the Tin Can Makers Association of the Philippines Inc. that the price of tin cans used for sardines and corned beef has gone up by P0.35-P0.40 per piece to a range of P3.35 to P3.40 this month.
They cited the rising cost of tin plate in the world market as the reason for the increase.
A Zamboanga-based sardines manufacturer had also said that it will increase the price of its 155-gram can of sardines by as much as P1.00 in the coming weeks.
Imported tin plates comprise 70 percent of tin can production cost.
Tin can costs make up about 20-45 percent of the total retail price of canned goods.
Latest price reports state that a 155-gram can of sardines costs between P10-11, while a 165-gram can of luncheon meat is sold at P23 to P26.
DTI Undersecretary for Consumer Welfare Zenaida Maglaya said they have sought the assistance of local government units to avert any undue increase in the prices of goods.
In addition to this, she encouraged consumers to spend wisely to get the best value for their hard-earned peso.
In Caloocan City, Mayor Enrico Echiverri yesterday ordered the City Administrator’s Office to strictly monitor the prices of commodities, especially rice and other food products, as he warned deceitful traders and retailers against overpricing.
City Administrator Russel Ramirez and the Market Division reminded retailers to prominently display price tags on individual consumer goods being sold as the law requires.
Echiverri appealed to residents to immediately call the city government hotline 288-8811 and that of the Department of Trade and Industry, 751-3330 to report overpricing.
Hard to sustain
At least two former officials of the Department of Agriculture and the National Food Authority said that the Arroyo government’s announcement to increase the NFA’s buying price of palay to P17 per kilo may not be sustainable.
Former agriculture secretary Senen Bacani and former NFA administrator Romeo David, in a forum hosted by the Management Association of the Philippines at the Manila Golf Club yesterday, acknowledged that the immediate and short-term goal of increasing the NFA palay buying price to P17 per kilo is to encourage farmers to plant more rice.
Bacani expressed confidence that with such an encouragement, “the Philippines could be self-sufficient in rice in as short as one year.”
But David pointed out the downside of a high palay buying price based on the normal formula of x2, wherein the domestic commercial selling price would now be between P34 to P38 per kilo which would hurt consumers while benefiting the farmers with a 170 percent ROI (Return on Investment).
Both officials explained that with the expected increase in production, the market buying price would also go down and the government would not be able to sustain the P17 buying price.
David said the government should make it clear to the public that there is really no supply shortage and what is occurring is a price crisis.
He stressed that “people are not lining up because there is no supply. People are lining up because they want cheap rice.”
According to Bacani and David, the NFA should adopt a distribution system that specifically targets the poor.
They both suggested the use of a food coupon program which the Department of Social Welfare and Development (DSWD) could implement along with local government units.
Local government units have given their commitment to distribute subsidized NFA rice to their poor constituents.
During yesterday’s Cabinet meeting at the Department of Justice, Agriculture Secretary Arthur Yap said the country’s mayors – represented by the League of Cities of the Philippines (LCP) and the Metro Manila Mayors’ League (MMML) – would assist the national government in the distribution of NFA rice.
Yap said that the commitment was made during a dinner hosted by Quezon City Mayor and MMML president Feliciano Belmonte Jr. during which LCP head and Mandaluyong City Mayor Benhur Abalos was also present.
According to Yap, the mayors are now in the process of preparing their respective lists of poverty areas where the P18.25 per kilo NFA rice would be made available.
The government has been enlisting the help of various sectors including the church to distribute the cheap NFA rice because of the complaints about the tight supply in markets.
Concerns about hoarding and diversion of NFA rice by unscrupulous traders have prompted President Arroyo to order a crackdown on these illegal activities.
The President also ordered the pull-out of the P18.25 rice from wet markets in order to ensure that this is sold only to poor families.
Abalos, who attended yesterday’s Cabinet meeting, said that the LGUs would be applying as NFA rice dealers to pave the way for the distribution of cheap rice to poor families in their respective areas.
He said that the LGUs would be relying on the DSWD list of the poorest areas and the families in these areas.
According to Abalos, this would be a pilot program and it would be up to the LGUs to decide how to go about the distribution of NFA rice.
“What is important is it’s going to the poorest of the poor,” Abalos said.
In the case of Mandaluyong, Abalos said that the city government would be working with the parishes in the distribution of NFA rice.
If the parishes are unsuccessful in reaching the target families, then the city government would set up its outlets.
“We will be able to fine-tune this. So I was telling Art Yap not to expect so much,” Abalos said. – AP, Ma. Elisa Osorio, Marvin Sy, Jerry Botial, Marianne Go
Chief News Editor: Sol Jose Vanzi
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