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UN: Don't Restrict Food Exports

Thu, 01/27/2011 - 10:31am

ROME (AP) — The United Nations urged governments Wednesday not to impose export restrictions or other short-term measures to cope with rising food prices, saying they can actually make matters worse by driving global prices up.

The U.N. Food and Agriculture Organization issued an updated policy guide for governments in the developing world who are grappling with the impact of high food prices.

The FAO has warned that prices of wheat and other staples rose alarmingly in 2010 and that some poor countries, particularly in Africa, may be headed for a repeat of the 2007-2008 food crisis that led to deadly riots in Africa, Asia and the Caribbean.

Already, rising food prices have been in part behind recent violent protests in Tunisia and Egypt.

During the 2008 crisis, the world's biggest rice producers, Thailand, Vietnam and India, curbed rice exports to protect domestic supply, leading to record high prices.

Wheat prices shot up sharply in August when Russia imposed an export ban after severe drought hurt harvests. In October, Ukraine — another major grain exporter — imposed export quotas because of the drought.

FAO said such export restrictions actually can aggravate food crises. During the 2007-2008 crisis, such short-term measures drove up food prices globally, depressed food prices domestically which then curtailed incentives to produce more food.

"The experiences of 2007-2008 food crisis shows that in some cases, hastily taken decisions by the governments to mitigate the impact of the crisis have actually contributed or exacerbated the crisis and aggravated its impact on food insecurity," said Richard China, head of FAO's policy support division.

African countries are most at risk since nearly all are net importers of cereals. City residents, small farmers, fishermen and farm workers are most hard hit since they don't produce all that they need to eat; the poorest among them spend more than three-quarters of their income on food.

FAO's index of basic food prices internationally peaked last month.

"With this new price shock only two years after the crisis in 2007-2008 there is a serious concern now about implications for food markets in vulnerable countries," China said in a statement.

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