While much of the world's attention is being paid to the financial crisis, a UN agency is warning not to forget the ongoing food crisis. The Food and Agriculture Organization says the financial turmoil could deepen the food crisis. So it's calling on world leaders to stick to the commitments they made at the food crisis summit in Rome in June. The warning comes amid this week's meeting of the agency's Committee on World Food Security.
David Hallam, head of the FAO's trade policy service, spoke from Rome to VOA English to Africa Service reporter Joe De Capua about why the agency fears financial troubles could affect food security.
"There are a number of potentially adverse effects that the financial crisis could have if it leads to the kind of global downturn in economic growth, which the IMF (International Monetary Fund), for example, has been predicting… in its world economic outlook," he says.
He adds, "On world markets, the demand for some agricultural commodities is very much related to the levels of economic activity and income. So, agricultural raw materials and also some of those products, which are more dependent on income levels for demand, things like some of the livestock products and so on – we'd expect perhaps to see a downturn in the demand for those and therefore a weakening in their prices."
He says that consumers could benefit from lower agricultural commodity prices if they actually filter down to that level. But he warns, "It may compromise some of the efforts that we've been making to try and encourage investment in agriculture, especially in developing countries."
Asked whether it would be natural for countries, like the United States, to reduce overseas spending in times like these, he says, "Yes. I mean it's something that I think…we've seen through history. When there is a downturn like this there tends to be a tendency to look inwards and cut those kind of external areas of spending. We're concerned about this because in the last year, of course, with the food crisis that we had, many developed countries have pledged greater support to agriculture in developing countries and we don't want to see that evaporate."
The FAO wants leaders to stand by their commitments to agriculture. "If we're going to try and restore stability in world food supplies and so on, then we really need that kind of productivity enhancing investment," he says.
However, he admits it's unclear just how the financial problems will play out. "There are different views at the moment on the extent to which developed countries will go into recession. How long such recessions might continue. So obviously the deeper and more prolonged the greater the risk is that funds for overseas development will be restricted," he says.Hallam says the "fundamental, underlying" causes of the food crisis were a long-term decline in investment in agriculture and poor productivity. These problems have not been solved, he says, and grain stocks remain low. "If you find then that there's a downturn in activity (and) there's a cutback in production, we could find ourselves back into the kind of emergency situation that we had earlier this year," he says.