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The Food Aid Dilemma

Author: Toni Johnson
July 14, 2008

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In Haiti, they make dirt cookies (AP) to stave off hunger pangs. In Ethiopia, adults now join the ranks of infants as severely malnourished (Herald). Families in a growing number of developing countries have little money for sending their children to school or for medical expenses (Economist). Food riots have occurred in nearly thirty countries, in some cases threatening political stability. Food rationing is also on the rise. Terkula Cornelius Igidi writes in Nigeria's Daily Trust that "for the poor man and his family, it is an untold story of hunger and starvation."

The UN Food and Agriculture Organization reports that 50 million more people faced hunger in 2007 as a result of higher prices. The UN World Food Program estimates there are 860 million chronically hungry people in the world, a tally that could increase by 130 million this year (VOA). The food problem is compounded by recent floods in the U.S. Midwest, droughts in Australia, and a cyclone in Asia's rice belt, as well as high fuel prices and livestock diseases such as bird flu. CFR Senior Fellow Michael J. Gerson notes in a recent Washington Post column that energy inflation has spurred innovation and the move to efficiencies. But in the case of food inflation, "there is no pleasant alternative to eating."

The designated culprits are familiar: biofuel production, commodity speculation, climate change, and agriculture subsidies. The growing crisis has sparked a panicked response in some countries, exacerbating food shortages and pushing prices even higher. Twenty-nine countries have imposed food export bans (NYT). The Dominican Republic has closed its border (MNN) with Haiti. The G8 countries recently issued a statement promising to normalize biofuel production with food security and condemning export bans. Even without bans, global food trade is limited, says this CFR Backgrounder, because the large majority of food produced globally does not cross national boundaries.

With the plight of the hungry so acute, the calls for additional food aid have grown. So far this year, the World Food Program spent $650 million—compared with the $400 million spent during the same period in 2007 to buy roughly the same amount of food (BusinessWeek). But some experts point out that the aid system keeps people hungry in the long run even as it feeds them in the short term. Alec van Gelder and Caroline Boin of the International Policy Network, a development think tank based in London, argue that aid has actually depressed development (Business Daily) in Africa. They note "70 [percent] of Africans who live off the land have falling incomes and life expectancy, while Asian countries that got little or no aid have prospered."

Nearly 80 percent of all food aid from developed nations in 2007 was in the form of surplus food produced by donors and often transported via donor shippers. Compared with buying food locally, shipping food donations can be slow and extremely costly. The United States is the largest contributor of food aid in the world. The latest U.S. Farm Bill authorizes $1.2 billion in food aid, of which just $60 million is in cash. CFR Senior Fellow Laurie Garrett writes in a recent working paper that the aid system has invested little in agriculture in developing nations, keeping the countries "locked in dependency mode," forced to either buy food on international exchanges or "pray for food aid." Activists have warned for years that this system was promoted by agribusiness conglomerates looking to maximize corporate profits. Economist Karen H. Johnson notes that distribution of surplus food items for aid helps distort food markets. But she expects the practice to diminish over time as surpluses decrease. Some leading developed states, like Canada, have already switched to cash aid.

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