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Higher Prices Means Less Food Aid: UN

Haider Rizvi

UNITED NATIONS - Millions of people across the world are more likely to face hunger and starvation due to disruption in aid deliveries caused by the rising prices of food, UN officials said this week.0614 02 1

In releasing a new report, officials at the UN's World Food Program (WFP) said aid deliveries have sunk to their lowest levels in nearly 50 years, with wheat and maize facing the sharpest drops due to the impact of the current price hikes.

Figures released in the WFP's "Food Aid Flows" report show that last year food supplies dropped to nearly 6 million tons, a 15-percent decline from the year before.

According to the report, wheat prices increased by 122 percent and maize prices by 86 percent between the years 2000 and 2007, making it increasingly difficult for international aid agencies to buy enough food to support crisis-ridden regions.

Last week, in addressing a news conference here, WFP chief John Holmes said farmers around the globe need an immediate boost in terms of inputs, such as fertilizers, seeds, and animal feed, to ensure smallholders in developing countries could produce more.

The WFP says early this year it faced a shortfall of $755 million in its budget as a result of soaring prices of food. The funding gap was only covered after extra donations came from more than 30 countries.

As food prices increased on international markets this year, officials said donor governments sought to purchase more and more food in developing countries, a strategy that both stretches budgets and supports economies in needy areas.

The report shows that the amount of food purchased in the developing world grew to 39 percent of the overall total in 2007 -- a record high that provided an important stimulus to agricultural markets.

At a high-level conference on food security held in Rome last week, delegates made a number of financial commitments. According to Holmes, the international community promised to contribute an additional $6 billion to address the global crisis of food.

Meanwhile, at a meeting held in Cape Town, South Africa early this week, World Bank officials said 100 million people in the developing world are likely to suffer more economic hardship as food prices continue to rise.


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''The majority of those affected are living above the poverty line of $1 a day. They will find themselves below this mark," said Danny Leipziger, the Bank's vice president for poverty reduction and economic management. "That is worrisome.''

However, Leipziger thinks that food prices will not continue to rise indefinitely. ''They will drop eventually. It will take four to five years before the situation stabilizes. However, that does not mean that the food prices will drop back to the level where they were a few years ago.''

Independent analysts and UN researchers say the phenomenal rise in food prices this year has been caused by a convergence of several well-established trends that are affecting both global demand and supply.

In his latest research, Lester Brown, an award-winning environmental analyst, points out that the unsustainable use of land and water, as well as trade imbalances among nations, are among the major factors contributing to the present crisis of food.

"Food security will deteriorate further unless leading countries can collectively mobilize to stabilize population and restrict the use of grain to produce automotive fuel," says Brown, who founded the non-profit Earth Policy Institute to analyze global environmental and economic trends.

According to the World Bank, at least 33 countries are currently in danger of political destabilization and internal conflicts driven by the rising prices of food. Bangladesh, Egypt, and Haiti, are among the countries that have already experienced food riots. Currently, some of the world's poorer countries are facing food price hikes up to 80 percent.

Robert Watson, the former head of the Intergovernmental Panel on Climate Change and chief economist at Britain's Department for Environment, Food, and Rural Affairs says the global production of food has increased, but notes with concern that "not everyone has benefited" from it.

In a recent statement, Watson blamed governments and private businesses for paying more attention to growth in production than natural resources or food security.

"Continuing with current trends means the Earth's haves and have-nots splitting further apart," he said. "It would leave us facing a world nobody wants to inhabit."

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