February 10, 2011 - “The biggest challenge facing most developing countries is the risk of a big boost in food prices. Food accounts for a large and increasingly volatile share of family budgets for poor and urban families. When prices of staple foods soar, poor countries and poor people bear the brunt.” – World Bank Group President Robert B. Zoellick.
BACKGROUND:
Costs for some basic foods are nearing or beyond the peaks of 2008. The World Bank expects volatile, higher than average grain prices until at least 2015. In the poorest countries, where people spend up to two-thirds of their daily income on food, rising prices are re-emerging as a threat to global growth and social stability.
There are nearly one billion hungry people worldwide. More than 60 percent of the world’s hungry are women. When faced with high food prices, poor households eat cheaper, less nutritious food and/or stop using health and education services. Farmers will grow food instead of higher-earning crops if they think they cannot afford to buy food. Malnutrition contributes to infant, child and maternal illness; decreased learning capacity; lower productivity and higher mortality. One third of all child deaths globally are attributed to under-nutrition.
Global food price volatility is on the G20 agenda, and Zoellick recently called for the G20 to “put food first” and advocated for steps to ensure vulnerable people and countries are not denied access to nutritious food. Zoellick pointed to the need for: help for smallholder farmers to become a bigger part of solution to food security; better access to information on the quality and quantity of grain stocks; improved weather monitoring, especially in Africa; deeper understanding of the relationship between international prices and local prices; establishing small regional humanitarian food reserves in disaster-prone areas; a code of conduct concerning export bans; effective social safety nets; fast-disbursing support as an alternative to export bans or price-fixing; and better risk management products.
HOW WE ARE HELPING:
The World Bank’s Global Food Crisis Response Program (GFRP) is helping some 40 million people in need through $1.5 billion in support. To date, over 40 low income countries are receiving or will receive assistance through new and improved seeds, irrigation, and other farm support and food assistance for the most vulnerable people. For example, in Benin, fertilizer provided through these resources led to the production of an extra 100,000 tons of cereal.
For the longer-term, the World Bank Group is boosting its spending on agriculture to some $6-8 billion a year from $4.1 billion in 2008.
In addition, we are supporting:
- The new Global Agriculture and Food Security Program (GAFSP), set up by the World Bank in April 2010 at the request of the G20 to support country-led agriculture and food security plans and help promote investments in smallholder farmers. To date, six countries and the Bill & Melinda Gates Foundation have contributed or pledged about US$925 million to the program over the next three years. When the GAFSP was conceived, pledges for greater investments in agriculture and food security were much higher at $22 billion. Since its launch, GAFSP has approved and started disbursing grants worth $321 million to 8 countries - Bangladesh, Ethiopia, Haiti, Mongolia, Niger, Rwanda, Sierra Leone and Togo.
- Advocacy for more investment in agricultural research, and for its improved effectiveness - including through the Consultative Group on International Agricultural Research.
- Monitoring agricultural trade to identify potential food shortages.
- Coordinating with UN agencies through the High-Level Task Force on the Global Food Security Crisis and with Non-Governmental Organizations.
The World Bank Group also supports wider measures to improve nutrition among vulnerable groups. Through Bank safety net programs such as conditional cash transfers, some 2.3 million school meals are provided every day to children in low income countries. The World Bank is also working with the World Food Programme to help feed 22 million children in 70 countries. Over the past decade, the World Bank has provided 98 million children with Vitamin A doses, information on improved child feeding practices, and de-worming.
