Getting Serious About Food

At the G8 July summit in Aquila, Italy, US$ 20 billion was pledged to support farmers in poorer countries. Is the world getting serious about food security? To be sure, while growing water shortages and climate change pose important challenges, the world is not running out of food, yet. Rather, it is the current system of market mediated food security that needs serious repair. If it is to provide a credible alternative to the politically more palatable, but also more costly system of national food self sufficiency, public investment in agriculture must not only be increased, it must be well spent, world food markets need to be made more dependable, and national social safety nets need to become effective. And even this will not suffice for a market mediated food security system to fulfill its potential as long as EU and US bio-fuel policies maintain the link between food and fuel prices. Our world can simply not afford to have its food prices determined in the infinitely larger fuel market. Clearly, a daunting agenda presents itself for academics and politicians alike. For starters, many questions remain about the G8's recent pledge. There are few details of how and where this new public money will be spent, and this can make a huge difference. Economic theory and empirical evidence suggest a focus on public goods such as rural infrastructure (roads, electricity and ICT), soil conservation, and agricultural research, development and extension (RD&E), as opposed to private goods such as farm inputs (fertilizers, seeds) or commodity specific marketing and promotion programs. Nonetheless, farm input subsidies are high on Africa's new agricultural agenda. The governments of Malawi and Zambia for example, have been spending more than 60 percent of their agricultural budgets on input and crop marketing subsidies, with other governments rapidly following suit. This leaves little room for investment that pays off over long periods, such as rural roads, irrigation, and agricultural RD&E.