Harshita Bhasin and Anirban Dasgupta warn of the perils of living on imported food.

The food crisis fueling an ongoing rush of inflation globally was already brewing due to the impact of Covid-19 and climate change and has been exacerbated significantly by the Ukraine conflict. Whether the Ukraine effect has been operative entirely through a real deficit in global food supplies or via increased speculation and hoarding remains a moot point in the  assessment of the ultimate impact on food security.

On 29 July 2022, World Bank’s food security update reported:

“Record high food prices have triggered a global crisis that will drive millions more into extreme poverty, magnifying hunger and malnutrition, while threatening to erase hard-won gains in development……As of July 29, 2022, the Agricultural Price Index is 19% higher compared to January 2021. Maize and wheat prices are 16% and 22% higher, respectively, compared to January 2021, while rice prices are about 14% lower.

On the same day, the heads of several multilateral organisations issued a joint statement that reiterated the extent of the food crisis, quoting an alarming figure of 345m acutely food-insecure people across 82 countries.

In a familiar template, international agencies have called on the global community for urgent action to address the crisis by facilitating international trade and extending emergency financing or food aid to the worst-hit countries. Despite this oft-repeated advice, a number of countries have, during the current food crisis, increased trade restrictions on key commodities to safeguard their domestic supply and manage domestic inflation. And the brunt is borne by countries dependent on international trade for their food security. 

Mainstream economists…. policy advice… is to disallow export restrictions on food commodities and thus prevent artificial shortage of food based on domestic considerations.

The view that unfettered trade holds the solution to shortage and volatility in the global food market is shared by most mainstream economists. Food policy authority Christopher Barrett presents the case clearly when he identifies the “ill-advised bans by a few major food-producing countries” as a key factor in precipitating the current food crisis. His policy advice in this respect is to devise new trade agreements under the aegis of the World Trade Organization to disallow export restrictions on food commodities and thus prevent artificial shortage of food based on domestic considerations. In this line of argument, the question of achieving food self-sufficiency for import dependent countries has been mostly ignored.

Historically, food self-sufficiency featured prominently in the development goals of most developing countries. However, the push towards trade liberalisation in the 1980s made many countries, especially those in the African continent, dependent on imports for key food grains. The 2007-08 food crisis exposed the fragility of the global food market on account of rising interlinkages with financial and energy markets, and severely impacted food security in sub-Saharan Africa among other regions. Unfortunately, this did not lead to any discernible policy shift towards self-sufficiency.

This current situation has revived the threat of a balance of payment crisis along with food shortages for several developing nations, including many in Africa. The dependence on export of a few commodities to finance their burgeoning food imports is the immediate challenge for many of these economies but the root of the problem is the increasing reliance on food imports for basic consumption needs in the first place. Between 2016 and 2018, Africa imported about 85% of its food from outside the continent leading to an annual food import bill of $35bn which is projected to reach $110bn by 2025. 

Some commentators argue that Africa’s food import bill is not a concern since many African nations are net food exporters on account of high volumes of exports of cash crops. However, Africa’s cereal import dependency raises questions on its ability to tide through global shocks such as the Ukraine war given the volatility in food prices and demand for Africa’s exports.

Despite decades of international attention on boosting agricultural productivity in Africa, the continent continues to import massive quantities of food staples. 

Long periods of low international food prices have undermined Africa’s cereal production as small-scale producers find themselves uncompetitive in the face of unchecked food imports. Despite decades of international attention on boosting agricultural productivity in Africa, the continent continues to import massive quantities of food staples. What has been missing is large-scale public investment and subsidies to agriculture which were crucial to the success of the Green Revolution in Asia. For a continent that would account for a quarter of the world’s population by 2050, global and national efforts must be redirected towards achieving substantial cereal self-sufficiency in Africa (see box: Kenya – parched of investment ). 

A case in contrast is India. The country has had a food surplus for some time in terms of cereals although import dependence persists for pulses and some oilseeds. However, food exports are more than sufficient to cover these import expenses, making India self-sufficient in food. 

In light of this food balance, pro-market commentators have criticised repeatedly the inefficiencies and excess food reserves arising from the public procurement of rice and wheat by the Food Corporation of India. And bans on the export of food commodities by India and others have been widely criticised in international policy circles as a counterproductive measure that destabilises global food markets and causes food inflation. Yet these accumulated stocks helped India avert a hunger crisis as Covid-19 induced lockdowns led to massive loss of livelihood. The public distribution system was used to provide free food grains to nearly 800m people through an emergency response programme that started in April 2020 and continues to this day. 

Some degree of food self-sufficiency would have insured these countries against their current extreme food crises

Beyond India, food security has deteriorated severely during recent months in other South Asian countries that do not have similar access to food reserves. Particularly affected are Afghanistan and Sri Lanka where there have been reports of alarming food deficits in the population – 92% in Afghanistan (May 2022) and 53% in Sri Lanka (July 2022). Both countries are dealing with a heavy economic collapse in the past year and the food situation may be an inevitable fallout. But some degree of food self-sufficiency would have insured these countries against their current extreme food crises.

A crisis in management

Sri Lanka has long been the poster child in the South Asian region for its extraordinary achievements in human development since the 1970s. From 2021, the country has faced the worst economic crisis since its independence in 1948 which has also resulted in great political turmoil. Imprudent macro-management as well as the shock related to the Covid pandemic are seen as the immediate factors behind the crisis. 

One of the most visible dimensions of the economic calamity afflicting Sri Lanka is the food crisis with food inflation in July 2022 being higher than 90%. The phenomenal increase in food prices is due to a year-on-year sharp drop in domestic production of the main staple, rice by 40% and fruits and vegetables by 35% in 2020-21. Added to the production shortfall is the country’s inability to pay for expensive food imports due to its precarious foreign exchange reserves. 

The government’s ill-conceived decision to ban chemical fertilisers in May 2020 without fully planning an organic transition is seen as the key factor behind the major production decline in agriculture. Although the ban was reversed in November 2021, the impact is not only still evident but has been accentuated by the foreign exchange crisis pricing out Sri Lanka from the international market for chemical fertilisers.

Food insecurity has already affected almost half of the population according to a World Food Programmesurvey in July 2022. In a situation of ongoing economic instability with massive loss in employment and earnings, Sri Lanka’s food crisis is likely to continue in the near future. It is a cautionary tale of the importance of food self-sufficiency and the holding of food reserves as policy goals to insure citizens against unplanned economic shocks from spikes in import prices.

Nevertheless, the criticism of restrictions on food commodity exports imposed by some nations is unfair since national governments are ultimately responsible for their citizens’ welfare. So it is an arguably understandable move when individual countries prioritise domestic objectives of food security and inflation control over global public good during major shocks. This is exactly what happened with Covid-19 vaccines when no number of speeches on international solidarity could detract Western governments from their single-minded pursuit of domestic vaccination goals.

Now is the time to bring self-sufficiency of food back into the policy agenda for all countries that are in a position to pursue such a goal in terms of their agricultural capacity. Clearly not everything that a country consumes needs to come from domestic production entirely. But, recent events have demonstrated that it is critical for medium and large developing countries to produce a substantial share of their total food requirement through domestic means. 

In a politically and ecologically uncertain world, food security needs to be built more and more along the lines of food self-sufficiency contrary to what policy manuals tell us.  

Parched of investment

Kenya, a country of more than 54m people, has long struggled to feed its population. World Bank data show that more than two thirds of Kenya’s population is exposed to moderate or severe food security. This is despite the country being notable for being one of the fastest growing economies in Africa and achieving lower middle-income status. The inadequacy of domestic production of food staples such as maize and wheat compels Kenya to be heavily dependent on international trade to meet the food demand for its rapidly rising population. So international food price volatility coupled with  recurring droughts in the country adds to Kenya’s vulnerability.  

Source: FAOSTAT

Since the early 2000s, the value of food imports as a share of Kenya’s overall merchandise exports has been steadily rising (see figure 1: Food import dependency, 2000-19). The cereal dependency ratio which gives the percentage of available domestic supply of cereals that was imported has become as high as over 40% in recent years. 

Kenya’s domestic food staple production is marred by a lack of public investment into agricultural public goods such as rural electricity, irrigation and roads as well as poor extension services and provision of seed and fertilisers and other inputs. Even though 83% of Kenya’s land is arid and semi-arid, just 2% of its arable land is under irrigation. This makes the country especially susceptible to supply shocks on account of climate variability. 

About 40% of Kenya’s crop area is used to grow maize – the most important staple. But the yield of maize in Kenya has stagnated in the last three decades (see figure 2: Maize yield in Kenya. This low productivity over the years has turned Kenya into a net importer of maize since the 1990s (see figure 3: Maize trade in Kenya)

Source: FAOSTAT
Source: FAOSTAT

Despite Kenya being a signatory to the ambitious Malabo Declaration which includes a commitment to allocate at least 10% of public expenditure to agriculture by 2025, it allocated just 1.39% of its budget to agriculture in 2022-23.

Alongside low investment, Kenya’s domestic cereal production is further impaired by the supply management policies of the national government. Import of cheap maize from international markets just around the harvest season has been known to suppress prices received by maize producers thereby undermining domestic production. 

Kenya needs to find a balance in using trade to ensure food security in the short term without undermining its domestic production. As climate-change shocks become more frequent in the country, it is vital that Kenya makes food self-sufficiency a priority.

Harshita Bhasin

Harshita is a PhD scholar at the Faculty of Economics, South Asian University in New Delhi, India. Her research interests include agrarian political economy and political ecology. Her doctoral thesis …

Read More »

Anirban Dasgupta

Anirban is Associate Professor at the Faculty of Economics, South Asian University, New Delhi, India. His research interest is in the areas of agrarian political economy, growth processes and development …

Read More »

Leave a Reply

Your email address will not be published. Required fields are marked *