International food crisis and proposals to overcome it – CADTM.org

How come people are still starving in the 21st century?

Peasant agriculture provides 70% of the worlds food production

This is the direct consequence of the agribusiness model that aims at garnering profits rather than at feeding the people. It is particularly obvious in countries of the global South where the IMFIMFInternational Monetary FundAlong with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68%% of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%). The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.orgs and the World BankWorld BankWBThe World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries payments. The World Bank advises those countries that have to undergo the IMFs therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

s structural adjustmentStructural AdjustmentEconomic policies imposed by the IMF in exchange of new loans or the rescheduling of old loans.

Structural Adjustments policies were enforced in the early 1980 to qualify countries for new loans or for debt rescheduling by the IMF and the World Bank. The requested kind of adjustment aims at ensuring that the country can again service its external debt. Structural adjustment usually combines the following elements : devaluation of the national currency (in order to bring down the prices of exported goods and attract strong currencies), rise in interest rates (in order to attract international capital), reduction of public expenditure (streamlining of public services staff, reduction of budgets devoted to education and the health sector, etc.), massive privatisations, reduction of public subsidies to some companies or products, freezing of salaries (to avoid inflation as a consequence of deflation). These SAPs have not only substantially contributed to higher and higher levels of indebtedness in the affected countries ; they have simultaneously led to higher prices (because of a high VAT rate and of the free market prices) and to a dramatic fall in the income of local populations (as a consequence of rising unemployment and of the dismantling of public services, among other factors).

IMF : http://www.worldbank.org/ policies have favoured an intensive form of export-oriented agriculture, competitive and profitable on the global market, squeezing out the production of staple foods and peasant agriculture, which produces 70% of the worlds food[2] . Food has become a commodity subject to speculation on the world market where a handful of large multinationals decide on prices.

Agribusiness grabs more and more land and water resources, destroys peasant seeds in favour of hybrids and GMOs, generalizes the use of chemical fertilizers and pesticides and increases the production of agrifuel

These large agribusinesses benefit from public subsidies, take over more and more land for the expansion of agrofuel production and drain water resources for high-consuming crops, they destroy peasant seeds in favour of hybrids and GMOs, and generalize the use of chemical fertilizers and pesticides.

This production model considerably increases the vulnerability of crops to external shocks and hugely contributes to climate change and to droughts that affect rain-fedFEDFederal ReserveOfficially, Federal Reserve System, is the United States central bank created in 1913 by the Federal Reserve Act, also called the Owen-Glass Act, after a series of banking crises, particularly the Bank Panic of 1907.

FED decentralized central bank : http://www.federalreserve.gov/ agriculture and dry up the water tables. It is part and parcel of the global capitalist system and its maniy crises of which the food crisis is but one.

About 60% of the population is affected by moderate food insecurity and 20% by severe food insecurity

One person in ten in the World is permanently hungry.According to a wider standard developed by the FAO and other UN bodies, 30% of the worlds population experience moderate food insecurity. The FAO observes that on the African continent about 60% of the population is affected by moderate food insecurity and 20% by severe food insecurity, and those figures are likely to increase with climate instability.

45% of the deaths of children under 5 are due to malnutrition, which means 3.1 million children

In 2020, an estimated 45 million children under the age of five were suffering from wasting, the deadliest form of malnutrition, which multiplies child mortality rates by up to 12 times. Furthermore, 149 million children under the age of five had stunted growth and development due to a chronic lack of essential nutrients in their diets.[3] 45% of the deaths of children under 5 are due to malnutrition, which represents 3.1 million children.

The gender gap in food insecurity continued to rise in 2021 - 31.9% of women in the world were moderately or severely food insecure, compared to 27.6% of men a gap of more than 4 percentage points, compared with 3 percentage points in 2020.[4]

Unicef announced on 23 June 2022 that almost 8 million children under 5 in 15 crisis-hit countries are at risk of death from severe wasting unless they receive immediate therapeutic food and careCareLe concept de care work (travail de soin) fait rfrence un ensemble de pratiques matrielles et psychologiques destines apporter une rponse concrte aux besoins des autres et dune communaut (dont des cosystmes). On prfre le concept de care celui de travail domestique ou de reproduction car il intgre les dimensions motionnelles et psychologiques (charge mentale, affection, soutien), et il ne se limite pas aux aspects privs et gratuit en englobant galement les activits rmunres ncessaires la reproduction de la vie humaine. . . . Since the start of the year, the escalating global food crisis has forced an additional 260,000 children or one child every 60 seconds to suffer from severe wasting in the 15 countries bearing the brunt of the crisis, especially in the Horn of Africa and the Central Sahel. The Unicef also states, the price of ready-to-use therapeutic food to treat severe wasting has soared by 16 per cent in recent weeks due to a sharp rise in the cost of basic ingredients, 600,000 additional children are without access to life-saving treatment and at risk of death.

Paradoxically a majority of people suffering from malnutrition are farmers, mainly small producers who do not possess land or not enough, nor the means to develop it, and who must sell as much agricultural produce as possible on the market to pay off their debts depriving their families of food. Of course, there are also the impoverished urban classes.

Moderate food insecurity: Refers to the level of severity of food insecurity, based on the FIES, at which people face uncertainties about their ability to obtain food and have been forced to reduce, at times during the year, the quality and/or quantity of food they consume due to lack of money or other resources. It thus refers to a lack of consistent access to food, which diminishes dietary quality, disrupts normal eating patterns, and can have negative consequences for nutrition, health and well-being.

Severe Food Insecurity: The level of severity of food insecurity at which people have likely run out of food, experienced hunger and, at the most extreme, gone for days without eating, putting their health and well-being at grave risk, based on the FIES.

Malnutrition: an abnormal physiological condition caused by inadequate, unbalanced or excessive intake of macronutrients and/or micronutrients. Malnutrition includes undernutrition (child stunting and wasting, and vitamin and mineral deficiencies) as well as overweight and obesity

Wasting Wasting is a lethal form of malnutrition, generally the result of weight loss associated with a recent period of inadequate dietary energy intake and/or disease. In children under five years of age, wasting is defined as weight-for-height less than -2 SD below the WHO Child Growth Standards median. In 2022, over 45 million children under five suffer from it.

Severe wasting: Condition characterized by extreme emaciation in relation to size, which leads to a weakening of the immune system. Severe wasting is the most immediate, the most visible and the most lethal form of malnutrition. In 2022 over 13 million children under five suffer from it.

The global food crisis had started before the Russian invasion of Ukraine

mile Frison, a member of the international panel of experts on sustainable food systems (IPES-food) stated in Le Monde: we must not be misled into believing that the food crisis is the consequence of the Covid health crisis and of the war in Ukraine, and that if those problems are solved, all will be well. Mathilde Grard, a journalist with Le Monde added: Those two major international events actually aggravated previous structural difficulties.[6]

The Global food crisis is not the result of deficient food production. Actually the global food production has increased more rapidly than the worlds population for over half a century. In 2021, the cereal crop reached a record high level.

But it has to be emphasized that an increasing part of the food produced is not intended for human consumption.

Governments of the North have supported the production of agrifuel, misleadingly called Green Fuel or biofuel to trigger a positive response among the public. In an article of April 2022, Jean-Franois Collin, a senior civil servant and former adviser to the French Ministry of Agriculture, highlights the considerable increase in the industrial uses of world cereal production (...), in particular the production of ethanol: 30% of the increase in world production over the last fifty years has been devoted to the development of industrial uses for cereals. This mainly concerns corn but also wheat. () Approximately 200 million tons of American corn are processed each year into ethanol for use in automotive fuel. 10% of the cereals produced in the world are now used as fuel Governments of the North have supported the production of agrifuel, misleadingly called Green Fuel or biofuel to trigger a positive response among the public. In an article of April 2022, Jean-Franois Collin, a senior civil servant and former adviser to the French Ministry of Agriculture, highlights the considerable increase in the industrial uses of world cereal production (...), in particular the production of ethanol: 30% of the increase in world production over the last fifty years has been devoted to the development of industrial uses for cereals. This mainly concerns corn but also wheat. () Approximately 200 million tons of American corn are processed each year into ethanol for use in automotive fuel. 10% of the cereals produced in the world are now used as fuel. We could add the areas devoted to other plants that are not cereals, such as rapeseed, soya or palm oil, which are used to produce diester, also used as fuel. These are all areas that are not devoted to the production of wheat or rice that could directly feed humans.

10% of the cereals produced in the world are now used as fuel, 35% as animal fodder

More than one third of the global production of cereals (35%), is destined to be fodder for farm animals.

A handful of transnational corporations control the cereal market, thus forming an oligo-pole, and constantly increase their profits and their assets to the detriment of the interests of the people. On a global level four corporations, three of which are US companies and the other is French, control 70% of the international cereal market. They have a fundamental influence in pricing and supply. They are Archer Daniels Midland, De Bunge, Cargill and Louis Dreyfus, often referred to as ABCD. On a global level four corporations, three of which are US companies and the other is French, control 70% of the international cereal market.

Let us take the case of Cargill. A recent report by Oxfam international stated: Cargill is a global food giant and one of the worlds largest private companies. In 2017 it was reported as one of four companies controlling over 70% of the global market for agricultural commoditiesCommoditiesThe goods exchanged on the commodities market, traditionally raw materials such as metals and fuels, and cereals., and is 87% owned by the 11th richest family in the world.70 The combined wealth of family members listed on the Forbes billionaire list is $42.9bn and their wealth has increased by $14.4bn (65%) since 2020, growing by almost $20m per day during the pandemic. This has been driven by rising food prices, especially for grains. Four more members of the extended Cargill family have recently joined the list of the richest 500 people in the world. In 2021, the company had net income of $5bn and made the biggest profitProfitThe positive gain yielded from a companys activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. in its history; the year before it paid out dividends of $1.13bn, most of which went to members of the family. The company is expected to make record profits again in 2022, adding to the familys already eye-watering wealth. The wealth of the Cargill family increased by 65% from 2020 to 2022, growing by almost $20m per day during the pandemic

Oxfams report adds, Cargill is not alone in seeing big profits off the back of food shortages and market volatility, according to Bloomberg. One of the companys competitors, the agricultural tradingMarket activitiestradingBuying and selling of financial instruments such as shares, futures, derivatives, options, and warrants conducted in the hope of making a short-term profit. house Louis Dreyfus Co., said in March that its profit surged by 82% last year, largely due to grain price fluctuations and strong margins in oilseeds. (Source: Oxfam Media Briefing Profiting from Pain. The urgency of taxing the rich amid a surge in billionaire wealth and a global cost-of-living crisis, published on 23 May 2022)

Such control over food distribution has allowed those agribusiness corporations, but also large commercial chains such as Wallmart or Carrefour, to impose around 30% price increases in 2021.[7]

Neoliberal free-trade policies, which we discuss further on, are other deep-lying causes of the food crisis. Indeed they have made countries of the Global South more and more dependent oncereal imports (see below our critical comments on various policies implemented by countries of the South under pressure of institutions such as the World Bank and the IMF but also of their own ruling classes). In case of an external shock leading to a price increase on the world market and/or a supply difficulty, the countries of the Global South, which do not produce enough cereals, are directly affected.

Among recent factors that have aggravated the food crisis, we have to mention the huge speculation on cereal markets as soon as Ukraine was invaded by Russia. The prices of wheat and corn increased by almost 50% within two weeks while at the time there had not yet been any destruction of production or supply problem. It was sheer speculation on the part of private corporations stocking up cereals (including future crops) on stock markets (the main one being located in Chicago). The price of rice also increased, though less steeply.

After the invasion of Ukraine prices of wheat and corn increased by almost 50% within two weeks while at the time there had not yet been any destruction of production or supply problem

Supermarket corporations immediately increased food prices without any reason.

At the moment these lines are written, end of August 2022, over the past three months the price of wheat has decreased by 32% and the price of corn by 22% on the Chicago stock market, but this had no effect on retail prices.

From end of May to end of August 2022 the price of wheat went down by 32% and the price of corn by 22% but this had no effect on retail prices.

Retail prices for consumers have sharply increased and it is unlikely that they should go down as governments do not enforce a policy of price control or price setting. Large private companies are free to set prices as they see fit.

Actually on a global scale the situation had been deteriorating since 2014. While there had been a serious food crisis in 2007-2008 (see our explanation 3865) resulting in over 800 million people experiencing hunger, the situation had improved from 2009 to 2013 then again deteriorated since 2014 (see tables 1 and 2).

Table 1: Number of people experiencing food insecurity at a severe level (in millions)

Source: FAOThe State of Food Security and Nutrition in the World 2022, table 4, p. 26

Globally, between 2014 and 2021, the number of severely food insecure people increased by more than 350 million, from 565 million to 924 million

Table 2: Number of people experiencing food insecurity at a moderate level (in millions)

Source: FAOThe State of Food Security and Nutrition in the World 2022, table 4, p. 26

From 2014 to 2021 on a global scale the number of people experiencing severe food insecurity increased from 565 to 924 million

Eradicating hunger is perfectly possible. Solutions to achieve this vital objective demand a project of food sovereignty radically different from the intensive agribusiness model. Food sovereignty refers to the right of each country to maintain and develop its own capacity to produce its staple food. It assumes the protection of natural resources, notably land, water and seeds. Food producers, distributors and consumers are to be put at the heart of food systems and policies rather than the demands of markets and transnational corporations, feeding the people by local producers, while reducing imports and exports. Food sovereignty can only be achieved if agro-ecology underpins governments decisions. Agro-ecology is an alternative to the productivist neoliberal model. It guaranteesGuaranteesActs that provide a creditor with security in complement to the debtors commitment. A distinction is made between real guarantees (lien, pledge, mortgage, prior charge) and personal guarantees (surety, aval, letter of intent, independent guarantee). the collective rights of peasants, protects biodiversity, strengthens local food systems, and values the literally vital work done by the women.

It would supply quality food: without GMOs, without pesticides or herbicides, without chemical fertilizers. Yet to reach this objective, over three billion peasants must gain access to enough land and farm for themselves rather than enrich large landowners, agribusiness transnationals, traders and lenders. They must also have access to public subsidies to farm the land, and without exhausting it.

Land reform is needed, it is still sorely wanting whether in Brazil, Bolivia, Paraguay, Peru, Asia or in some African countries. Such a reform must organize the redistribution of land, prohibit large private estates, and supply public support to farmers. It must counter the land policies enforced by the World Bank, trusts such as the Bill & Melinda Gates Foundation and multinationals that favour large-scale operations of land-grabbing.

It must preserve existing forests and encourage reforestation, stop the privatization and commodification of water resources, avoid single crops that exhaust the soil It has to be emphasized that the IMF and the World Bank have a huge responsibility in the food crisis since these institutions insisted that countries become more and more dependent on international markets, canceled help to small farmers and offered most favoured advantages to agribusiness transnationals. The IMF and the WB advised governments in the South to eliminate grain silos that were used to supply the domestic market in the event of a supply shortage and/or price explosion. The World Bank and the IMF have pushed Southern governments to abolish public credit agencies for farmers and have pushed these into the clutches of private lenders (often large traders) or private banks that charge usurious rates. This has led to massive debts among small farmers, whether in India, Mexico, Egypt or several countries in Sub-Saharan Africa. According to official surveys over-indebtedness among Indian peasants is the main cause of suicide of nearly 400,000 farmers in India over the past 25 years. India is precisely one of the countries where the World Bank convinced public authorities to suppress public lending to farmers. Over the past 50 years the WB and the IMF also pressed tropical and other countries of the South into replacing their production of wheat, rice or corn with export crops such as cocoa, coffee, tea, bananas, peanuts, flowers, cotton or cane sugar. To complete their labour in favour of agribusiness corporations and countries exporting cereals (starting with the US, Canada and Europe), they pushed governments to open their markets to food imports that, in the North, are largely subsidized leading many producers in the South into bankruptcy and causing a steep reduction of local food production.

To sum up, we have to implement food sovereignty, promote agro-ecology and introduce land reforms. We must stop producing industrial agro-fuel and ban public subsidies to those who produce it. We must recreate public food reserves (particularly cereals: rice, wheat, corn), (re)create public credit agencies for farmers and regulate food prices. We must make sure that low income populations can have access to quality food at low prices. We must cancel VAT on staple foods. The State must guarantee small farmers sufficiently good prices to allow them to significantly improve their living conditions. The State must also develop public services in rural areas such as health care, education, communications, culture, or seed banks. Public bodies are perfectly able to guarantee both subsidized prices for food consumers and sufficiently high selling prices for farmers to bring in a sufficient income.

Indeed we cannot seriously claim that we are fighting hunger without getting to its root causes. Debt is one of them and the various announcements on this issue, which have been frequent in recent years, such as during the G7 or G20G20The Group of Twenty (G20 or G-20) is a group made up of nineteen countries and the European Union whose ministers, central-bank directors and heads of state meet regularly. It was created in 1999 after the series of financial crises in the 1990s. Its aim is to encourage international consultation on the principle of broadening dialogue in keeping with the growing economic importance of a certain number of countries. Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, Italy, India, Indonesia, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, USA, UK and the European Union (represented by the presidents of the Council and of the European Central Bank). summits, do not hide the fact that hunger remains an unresolved problem. The current global crisis makes the debt situation of developing countries even worse and new debt crises are in the offing. The events in Sri Lanka or Argentina in 2022 are glaring examples. This debt has led peoples of the South, who could otherwise rely on significant human and natural resources, into massive poverty. The debt system is organized plunder which must be stopped.

Indeed the infernal mechanism of illegitimate public debt is a principal obstacle to the satisfaction of basic human needs, including access to decent food. Without a doubt, the satisfaction of basic human needs must take precedence over any other consideration, whether geopolitical or financial. From a moral perspective, the rights of creditors, landlords or speculators are a mere trifle in contrast to the fundamental rights of eight billion citizens, trampled on by the implacable mechanism of debt.

It is immoral to demand that people in countries impoverished by a crisis they are not responsible for devote a large part of their resources to repay well-to-do creditors (whether in the North and in the South) rather than to meet their basic needs. The immorality of the debt is often a consequence of its having been contracted by non-democratic regimes that have not used the loans in the interestInterestAn amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. of their populations and organized large-scale embezzlement with the tacit or explicit approval of countries in the North, private creditors, the World Bank and the IMF. Creditors of industrialized countries have often knowingly lent to regimes that are corrupt. They have no right to demand that the people pay back these immoral and illegitimate debts. To put it in a nutshell, debt is one of the main mechanisms through which a new kind of colonization operates. It comes on top of the historical violations already committed by rich countries: slavery, extermination of indigenous populations, colonial yoke, plundering of raw materials, of biodiversity, of farmers know-how (through the patenting of agricultural products from the South, such as Indian basmati rice, for the benefit of agribusiness transnationals from the North) and of cultural goods, brain drain, etc. It is high time, in a concern for justice, to replace the logic of domination by a logic of redistribution of wealth.

The G7, the IMF, the World Bank and the Paris ClubParis ClubThis group of lender States was founded in 1956 and specializes in dealing with non-payment by developing countries.

impose their own versions of truth and justice, of which they are both judge and party. Since the crisis of 2007-2009, the G20 has taken over from the G7 and has contributed to putting the discredited and delegitimized IMF back at the center of the political and economic game, particularly with regard to the Global South. We must put an end to this injustice which benefits the oppressors, whether they are from the North or the South.

The CADTM wholeheartedly supports the proposals and demands formulated by the international peasant movement La Via Campesina to face the current food crisis and move toward food sovereignty.

Faced with this dramatic context, La Via Campesina voices strong demands and proposals to address the crises, both in the short and the longer terms.

We demand immediate action to:

We demand radical changes in international, regional and national policies to re-build food sovereignty through:

A radical shift towards agroecology to produce healthy food in quantity and quality for the whole population. We must bear in mind that the climate and environmental crisis will be our great challenge in this current context. We must face the challenge of producing enough quali-ty food while reviving biodiversity and drastically reducing GHG emissions.

With thanks to Pablo Laixhay and Brigitte Ponet for their careful reading.

We recommend to read this CADTM press release -> 2022: Ending the food crisis

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International food crisis and proposals to overcome it - CADTM.org