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Posts Tagged ‘World Bank

The plot to cripple the Bharatiya kamadhenu

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To focus your attention on the terrible fate that threatens our indigenous breeds of cow and buffalo, here are the connections, which are now more than 45 years old, between the period that led to Operation Flood (or ‘white revolution’ as it was also called) and with it the campaign to increase the supply of milk in India by steadily weakening the desi gou, and the situation we have today of a National Dairy Support Project, which continues to do the same.

A little history. At the end of the 1960s, surplus dairy products from what was then the European Community were sent to India through the World Food Programme (WFP). This dairy produce was sold to cooperative and state dairies in Mumbai, Kolkata, Delhi and Chennai, ‘reconstituted’ with local milk and sold to city consumers. This project was known as Flood I and was to end in 1975. It continued until 1981.

From the Chapter on Agriculture and Food Management (page 181), the Economic Survey 2016-17, Volume 2, uses language like “terminal value of assets, in this case the no-longer-productive livestock” and warns about social (that is, the Hindu cultural view) policies which “drive this terminal value precipitously down” affecting “private returns… in a manner that could make livestock farming less proftable”. The Finance Ministry and India’s macro-economic planners see our gou and buffalo only as milk producers or sources of meat, and calculate only what it costs to keep them producing or profitable.

Three years earlier in 1978 Flood II had begun. This extended Flood I to the whole country, and was financed by a loan from the World Bank’s International Development Association (IDA) and direct aid from the European Community. Flood II was to conclude in 1985 but was extended until 1987.
In the late 1980s this nearly twenty-year long programme was considered to have:
* improved the living conditions of 10 million families of milk producers by adding 13 million litres of milk per day to the cooperative dairy industry’s processing capacity
* created a milk distribution network covering 142 cities with more than 100,000 inhabitants
* created the infrastructure needed to carry out programmes to promote dairy production, such as artificial insemination, vaccine production, the manufacture of compound foodstuffs
* raised daily milk consumption to 180 grams per inhabitant “to obtain a nutritionally balanced diet”

Now to our recent past. On 15 March 2012 the World Bank approved a National Dairy Support Project (project number P107648) for India. The project began on 22 June 2012, was reviewed in April 2015, had an original closing date of 31 December 2017 which has been revised now to 29 November 2019. It has three components which are: ‘Productivity Enhancement’ (US$193.80 million), ‘Milk Collection and Bulking’ (US$77.30 million) and ‘Project Management and Learning’ (US$22.00 million).

The World Bank’s description of project number P107648 is:
“The National Dairy Support Project (NDSP) which supports India’s National Dairy Plan, Phase I (NDP-I), aims to cover about 40,000 villages across 18 participating dairying states with investments in Productivity Enhancement (e.g., high genetic merit bulls, disease-free semen production, doorstep artificial insemination services, ration balancing program, fodder development) and Milk Collection and Bulking (e.g., village-level infrastructure such as bulk milk cooling units).

Brazenly ‘free market’-oriented in its advice and advocacy, Niti Aayog has mentioned only breeding in its section on livestock, in the policy paper on ‘Doubling Farmers’ Income: Rationale, Strategy, Prospects and Action Plan’, March 2017. The usual complaint of low milk productivity, growth in milk output needed, better feed and nutrition for animals are found in this think-tank’s MNC-directed view.

The description continues: “At its inception, this eight-year project was expected to directly benefit about 1.7 million rural milk producing households through its interventions, a large majority of whom are small holder producers with six animals or less.
“Cumulatively till date, 158 End Implementing Agencies – EIAs (e.g., milk unions, milk federations, dairy producer companies and livestock development boards) are implementing 364 sub-projects across 18 states with a total outlay of Rs. 1904 Crores (USD 292 million), out of which Rs. 318 Crores (USD 48.9 million) are contributed by the EIAs. These participating states account for nearly 95 per cent of India’s milk production, over 87 per cent of the breedable cattle and buffalo population and 98 per cent of the country’s fodder resources. To date, over 2.7 million milk producers have benefited from overall NDP interventions in breed improvement, animal nutrition and bulk milk collection.”

For each of the years 2013 to 2016, the National Dairy Support Project has required the import of “frozen in-vivo produced” and “pure bred” Holstein, Friesian and Jersey bulls. This is to continue for 2017 to 2019 so that the 100 million doses “target” of the artificial insemination programme is reached.

This is the brief outline and background of the government-managed, World Bank-directed programme to weaken generation after generation of our desi gou through a machiavellian plan of cross-breeding them with foreign cattle (Holstein, Friesian and Jersey), so that the gou-based economy of Bharat will be destroyed and replaced by a dairy products industry designed and controlled by multinationals that include Nestlé, Danone, Lactalis, FrieslandCampina, Fonterra, Dean Foods, Unilever, Kraft Heinz, Schreiber Foods and 11 others. It will also be partly controlled by Amul, Mother Dairy, Kwality, Hatsun Agro, Heritage Foods, VRS Foods, Anik Industries, Parag Milk Foods, Creamline Dairy Products and others who greedily want their share of what is calculated to be a market sector worth more than Rs 80,000 crore. There is no desi gou, nor the reverence to kamadhenu. There are only products, consumers and an arsenal of sickening technology and breeding programmes that if not stopped now will result in the remaining 39 desi gou breeds losing their desi qualities.

It is this that lies behind the Rashtriya Gokul Mission that was launched in December 2014, the National Programme for Bovine Breeding, the National Mission on Bovine Productivity that was launched in November 2016 (which includes the Pashu Sanjivni for identification of animals in milk using UID, embryo transfer technology labs with IVF facilities, the e-pashu haat portal, the National Bovine Genomic Centre for Indigenous Breeds), the National Kamdhenu Breeding Centres (one in Andhra Pradesh and another in Madhya Pradesh), and the three subordinate organisations: Central Cattle Breeding Farms, Central Herd Registration Scheme, Central Frozen Semen Production and Training Institute.

This is the horrifying extent of what has been done since 2012, the methods for which were introduced over 45 years ago, and which are now frighteningly augmented by the unchecked and unregulated animal genomics.

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Retiring the American dollar

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Off into history's sunset, like the cowboy. This image (modified) is called 'Dollar Green' by the artist mancaalberto (http://mancaalberto.deviantart.com/)

Off into history’s sunset, like the cowboy. This image (modified) is called ‘Dollar Green’ by the artist mancaalberto (http://mancaalberto.deviantart.com/)

Seventy years ago, to the very month, a man named Henry Morganthau celebrated the creation of a “dynamic world community in which the peoples of every nation will be able to realise their potentialities in peace”. It was the founding of what came to be called the Bretton Woods institutions (named after the venue for the meeting, in the USA) and these were the International Bank for Reconstruction and Development – better known as the World Bank – and the International Monetary Fund.

None of the lofty aims that seemed so apposite in the shattering aftermath of the Second World War have been achieved, although what has been written are libraries of counter-factual history that claim such achievements (and more besides) commissioned by both these institutions and their web of supporting establishments, financial, academic, political and otherwise. Instead, for the last two generations of victims of ‘structural adjustment’, and of ‘reform and austerity’ all that has become worthwhile in the poorer societies of the world has been achieved despite the Bretton Woods institutions, not because of them.

Now, seventy years after Morganthau (the then Treasury Secretary of the USA) and British economist John Maynard Keynes unveiled with a grey flourish a multi-lateral framework for international economic order, the Bretton Woods institutions are faced with a challenge, and the view from East and South Asia, from Latin America and from southern Africa is that this is a challenge that has been overdue for too long.

Let's get the de-dollarisation of the world started.

Let’s get the de-dollarisation of the world started.

It has come in the form of the agreement between the leaders of five countries to form a development bank. Russia’s President Vladimir Putin, China’s President Xi Jinping, India’s Prime Minister Narendra Modi, Brazilian President Dilma Rousseff and South Africa’s President Jacob Zuma made formal their intention during the sixth summit of their countries – together called ‘BRICS’, after the first letters of their countries’ names – held this month in Brazil.

What has been set in motion is the BRICS Development Bank and the BRICS Contingency Reserves Arrangement. Both the new institution and the new mechanism will counter the influence of Western-based lending institutions and the American dollar, which is the principal reserve currency used internationally and which is the currency that the IMF and the World Bank conduct their ruthless business in (and which formulate their policies around, policies that are too often designed to impoverish the working class and to cripple labour).

At one time or another, and not always at inter-governmental fora, the BRICS have objected to the American dollar continuing to be the world’s principal reserve currency, a position which amplifies the impact of policy decisions by the US Federal Reserve – the American central bank – on all countries that trade using dollars, and which seek capital denominated in dollars. These impacts are, not surprisingly, ignored by the Federal Reserve which looks after the interests of the American government of the day and US business (particularly Wall Street).

In the last two years particularly, non-dollar bilateral agreements have become more common as countries have looked for ways to free themselves from the crushing Bretton Woods yoke. Only this June, Russia’s finance minister said the central banks of Russia and China would discuss currency swaps for export payments in their respective national currencies, a direction that followed Putin’s visit to China the previous month to finalise the gigantic US$400 billion deal between Gazprom and China National Petroleum Corporation (CNPC). It is still early, and the BRICS will favour caution over hyperbole, but when their bank opens for business, the sun will begin to set on the US dollar.

Why agricultural investment ‘principles’ must be buried

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FAO_IYFF_1This year the Food and Agriculture Organisation (FAO) will through its Committee on World Food Security, advocate principles concerning what are called ‘responsible agricultural investments’. The adoption of principles such as these are expected to promote investments in agriculture that contribute to food security and nutrition, and which support the realisation of the right to food, particularly within national contexts of how food security is defined.

While the principles are intended to provide practical guidance to governments, private and public investors, intergovernmental and regional organisations, civil society groups, research units and universities, donors and philanthropic foundations, they will be voluntary and will not be binding upon their signatories.

FAO_IYFF_2The problem with such a conceptualisation of international or globally applicable principles is that the negative consequences that accompany investment are left undefined and therefore weak as a countervailing argument. Investment made to acquire land, to pursue industrial agricultural techniques (in contrast to policies and programmes that support smallholder cultivation), and which – experiences of the last three decades have shown – have deepened income inequalities while making those vulnerable to food scarcity and food price volatility even more so.

These investments are determined by a dominant political economy found in a country, or a sub-national region – important variations that cannot be recognised or dealt with in any meaningful way by a set of voluntary principles (nor even with the aid of a ‘knowledge platform’ on the subject set up by the World Bank, FAO, UNCTAD and IFAD.

In this article published by Pambazuka News – the pan-African community of some 2,600 citizens and organisations that make it one of the largest and most innovative and influential web forums for social justice in Africa – I have examined the rationale and background to the principles pertaining to ‘responsible agricultural investment’ (which is now referred to commonly by the ‘RAI’ short form); and also concepts about agricultural investment (or public and private spending on agricultural activities) especially what are assumed and what are implied; and a conclusion criticises the RAI and the effort to promote a multi-lateral common ground for problems that are essentially local.

FAO_IYFF_3“The adoption of RAI will aid, in any host country, the tailoring of all policies and strategies to fit investors (foreign and domestic, for the technological advantages are now common, as much as the conduits of capital flow for food and agriculture investment are many) so that they can be ‘competitive’ in the market. Instead of prioritising a model of agricultural production where women, farmers/peasants, pastoralists and all small-scale food producers are at its core, in which agro-ecological forms of farming and raising livestock are supported, and through which local markets and economies are strengthened, the draft RAI principles will if accepted legitimise policies that put the government and country at the service of such investors (both foreign and domestic, it must be noted).”

Moreover, from the point of view of human rights terms this is discriminatory; and will turn a parlous situation into a destabilising one – already countries are falling short of their obligations related to realising the right to adequate food (a foretaste of which was seen most recently during the World Trade Organisation ninth ministerial conference in 2013 December which brought to the fore disagreements about governments’ own procurement of food for public programmes as distorting world trade).

[Read the full article on Pambazuka News.]

Appraising World Food Day 2013

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FAO-world_food_day_2013It must be difficult to be a senior official in the Food and Agriculture Organisation (FAO) of the UN these days, especially if the official is above 40 years old and has spent the last two decades working “in the field” (which usually means away from some capital city somewhere, in discomfort that is amusingly relative to most of us proletarian toilers). For, I do think that there is still a majority of folk in the FAO who care about their work and the aims of the organisation, muddled though these get when 190-odd member states each bring their own version of reality (and ambition) into the proceedings.

More difficult it is nowadays in an FAO that is being shepherded more closely into the embrace of the OECD, the World Bank-International Monetary Fund, World Trade Organisation embrace, with its murmuring old boys’ clubs all shadowy in their suits, adept at facilitating the trade of political positions for corporate board seats. And more difficult it is nowadays in an FAO that is scrutinised every day by NGOs and civil society groups that have successfully ensured that negotiations called ‘multi-lateral’ must be open before public gaze and can no longer hide behind empty principles when hunger – FAO’s single problem – stalks the planet.

Perhaps that is one reason why the FAO has called this year’s World Food Day ‘Sustainable Food Systems for Food Security and Nutrition’ – and notice the addition of ‘nutirion’, there’s no getting away from the N-word these days, so loaded has it become. The theme, to borrow from the typically bland FAO pronouncement, “gives focus to World Food Day observances and helps increase understanding of problems and solutions in the drive to end hunger”. Well said, for the umpteenth time.

Via_Campesina_food_sovereigntyBut there have been departures from the corporate script lately which are surprising. On 2013 October 04 the Director General of FAO, José Graziano da Silva, formalised a tie with La Via Campesina, recognising it as the most important voice of small food producers worldwide. This is seen by Campesina as “yet another welcome step in a series of ongoing reforms of the FAO, which have created a unique and unprecedented space to collaborate with civil society and democratize the arena of global food policy”. Easier wished for than done, as Campesina well knows, because the financiers and bankers, agri-commodity trading oligopolies and mafioso, the crooked politicians in the European Union and their willing partners in the ‘developing’ world are not going to quietly let this happen.

These reforms are aimed at giving the FAO not just more political legitimacy by becoming more inclusive, but also at reviving it as the cornerstone for international cooperation in the area of food security, starting to take such policy decisions out of the hands of the World Bank (WB) or the World Trade Organization (WTO.) While these developments are welcome, the global peasants’ movement remains realistic about the amount of energy that should be put into the UN, maintaining its greatest strength on the ground mobilizing farmers and building alternatives.

The IFPRI Global Hunger Index 2013 world map, blatantly patronising in its North-South exclusion. The white areas are not even in the map legend. They correspond to the OECD/'industrialised' world, and the IFPRI/CGIAR view is that the chronic mis-nutrition of western societies has no place in a report on global hunger. Nor does this map consider the growing effects of working class poverty in the OECD countries.

The IFPRI Global Hunger Index 2013 world map, blatantly patronising in its North-South exclusion. The white areas are not even in the map legend. They correspond to the OECD/’industrialised’ world, and the IFPRI/CGIAR view is that the chronic mis-nutrition of western societies has no place in a report on global hunger. Nor does this map consider the growing effects of working class poverty in the OECD countries.

In 2012, at the 39th session of FAO’s Committee on Food Security (CFS), the G20 approached the CFS and asked the Committee to agree with what it said on price volatility in agricultural commodities, which since 2007 has dragged tens of millions of households in South and North into hunger and debt. When that happened, and when a compromised CFS agreed, the civil society delegation to the session walked out. The NGOs, social movements, representatives of peasants’ federations and associations who were present had, on the contrary, demanded strong regulation of the commodity futures markets that fuel price volatility and the food insecurity of the poorest. But the G20 (and that means the investors in a global agribusiness industry) won that round.

With the help of the CGIAR, what for the sake of convenience we call the G20 will want to win every time. The CGIAR is the Consultative Group on International Agricultural Research which runs 15 centres around the world that are described as “independent, non-profit research organizations, innovating on behalf of poor people in developing countries” and as being “home to almost 10,000 scientists, researchers, technicians, and staff working to create a better future for the world’s poor”. The descriptions about ‘independent’, ‘non-profit’ and ‘for the poor’ are lies, as they have been for every single one of the 40 years of this plague called the CGIAR. But the CGIAR system is large, powerful, almost invisible and little understood except by those in agricultural research systems (such as those in the Indian Council of Agricultural Research) in ‘developing’ countries.

And that is why the release, a few days ago, of the ‘Global Hunger Index’ 2013 needs to be interpreted for what it is, because it is the product of one of the CGIAR centres, the International Food Policy Research Institute (IFPRI). The annual index offers a ranking of hunger, or food insecurity/security for many countries but not all (see the image of the map and its caption). The IFPRI functions worldwide as a motivated think-tank that commissions carefully scripted research to fulfil pre-determined outputs that serve the interests of those who profit from the industrial agricultural system and retail food system.

That such an obvious fifth column finds residence and a willing ear in India ought to be a matter of shame to us. Here is a small example why. The IFPRI, in the 2013 Global Hunger Index, has distributed its ‘recommendations’ which are from the typical neo-liberal charter of subjugation of the working classes and the denial of choice, all camouflagued by whichever development jargon is found to be currently in vogue.

The cover of the Global Hunger Index 2013 report. Read the recommendations to grasp why this has been released, ignore the data.

The cover of the Global Hunger Index 2013 report. Read the recommendations to grasp why this has been released, ignore the data.

Hence “broader policy coherence for development is also a key requirement for efforts to strengthen resilience. Policies that undermine resilience must be revised. To foster resilience to undernutrition, policies should be designed with the intention of improving nutrition outcomes and realising the right to adequate food” in fact means – do away with policies that still see a role for the state and the public sector, hide this behind trendy concepts like ‘resilience’ and ‘right to food’, but include nutrition (which I mentioned earlier) because that is the route the MNCs have successfully used.

Hence “encourage and facilitate a multisectoral approach to resilience (as the Scaling Up Nutrition movement encourages a multisectoral approach to nutrition, for example), coordinating plans and programs across line ministries” in fact means – phase out your thinking and replace it with ours, which comes with a United Nations endorsement and which places private business at the centre of policy and its implementation.

Hence “adjust policies and strategies that undermine the resilience of poor and vulnerable groups, such as the low import tariffs or the structural neglect of smallholder agriculture in Haiti” in fact means – remove barriers to food imports, stop subsidies and subventions that the poor, marginalised and vulnerable have a right to in your country (consider the ruckus the World Trade Organisation has been making about India’s new National Food Security Act) and spout righteous claptrap about ‘neglect’.

Hence “ensure that policies and programs draw on a wide range of expertise such as collaborative, multiagency, and multisectoral problem analysis. National governments should support the emergence of multistakeholder platforms and make active use of such forums” in fact means – the expertise will be foreign and provided by the CGIAR and its numerous allies in all garbs, these ‘multi’ platforms will be public showcases to conceal an agenda already set.

[The full IFPRI Global Hunger Index 2013 report is here. The ‘issue brief is here’ for those who want a condensed dose of dangerous neo-liberal vitamins. And the obligatory data set used to support the well-set arguments is here.]

There is no comparison between the IFPRI propaganda and the annual report of the Right to Food and Nutrition Watch 2013, the sixth edition of which was released in 2014 October. The Watch identifies a number of policies that generate hunger and malnutrition instead of reducing them. The Watch insists on the need for meaningful participation – at every level – of people and communities in the development of those public policies which affect their lives.

You will find here national case studies and analysis that show (1) policies that foster violence and discrimination against women with regard to equal access to natural resources, inheritances, equal wages and political decision-making, (2) policies that systematically limit and exclude large groups, including peasants, agricultural workers, fisherfolks, pastoralists and indigenous peoples from participating in those decisions that affect their very livelihoods and (3) policies on a global level that facilitate land grabbing, concentrated ownership of natural resources and the commodification of public goods that deprive smallholders and other people of their food resources.

If global food indices are descending, why are local food prices rising?

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The trends of ten international food commodity indices from 2006 onwards.

The trends of ten international food commodity indices from 2006 onwards.

The main chart plots the course of the Food and Agriculture Organisation (FAO) Food Price Index and nine other international food price indices. These are FAO’s cereals index, the International Monetary Fund’s (IMF) food index, the International Grains Council (IGC) wheat index, the IGC’s rice index, the UN Conference on Trade and Development’s (UNCTAD) two wheat indices, Unctad’s rice index, the World Bank’s (WB) food index and WB’s grains index.

Consumer price index trends 2006 to 2013 for five South Asian countries

Consumer price index trends 2006 to 2013 for five South Asian countries

The familiar FAO blue pair for 2013 August

The familiar FAO blue pair for 2013 August

On the main chart, after 2008 December four stages are marked. The first stage is 2008 December to 2010 July, when the indices describe a plateau but which is very much higher than where they were through 2006. The second stage is 2010 July to 2011 April, which corresponds to the second global food price rise and when all these indices rose in concert. The third stage is 2011 April to 2012 September when they all declined to another plateau which nonetheless is higher overall than the last one (stage one), but which rose steeply for a short while towards the end of the stage. The fourth stage is still current, from 2012 June, which is seeing a gradual decline in all the indices to the point they were in 2011 August-September.

I have appended to the main chart the counterpoint of the consumer price indexes from South Asian countries – Nepal, Sri Lanka, Bangladesh, Pakistan and India. The question that follows, when reading the main chart with ten indices and the CPI chart for South Asia, is why the CPI trends do not follow the international grains trends. One of the major factors (which charting this data cannot reveal, as the FAO Food Price Index does not) is the extent to which the industrialisation of prmary crops sets the retail price in the markets of Colombo or Chittagong or Karachi or Mumbai or Kathmandu. Primary crop – that is, cereals, pulses, fruit and vegetable, milk and dairy – is being moved internally, processed, packaged, moved again, retailed in modern convenience stores to a much greater degree than was the case a decade ago. Those costs lie outside what the FAO-IGC-IMF-Unctad-WB indices can describe. But we need to urgently – within these countries and as a group – share methods to gauge and monitor these costs and document their impacts on households.

A food policy pedlar’s annual derby

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IFPRI_GFPR_2012Evidence, investment, research, commitments and growth. You will find these reprised in the second Global Food Policy Report by the International Food Policy Research Institute (IFPRI, which, as I must never tire of mentioning, is the propaganda department of the CGIAR, the Consultative Group on International Agricultural Research, which, ditto, is the very elaborate scientific cover for control over the cultivation and food choices made especially by the populations of the South). And now, with the dramatis personae properly introduced, let me quickly review the plot.

The GFPR (to give this slick production an aptly ugly acronym) for 2012 follows the first such report and furthers its  claim to provide “an in-depth look at major food policy developments and events”. It comes equipped with tables, charts, cases, apparently authoritative commentary (many from outside IFPRI), and is attended by the usual complement of models and scenarios (can’t peruse a report nowadays without being assaulted by these).

In an early chapter, the GFPR 2012 has said:
“Evidence points to a number of steps that would advance food and nutrition security. Investments designed to raise agricultural productivity — especially investments in research and innovation — would address one important factor in food security.”
“Research is also needed to investigate the emerging nexus among agriculture, nutrition, and health on the one hand, and food, water, and energy on the other.”
“In addition, by optimizing the use of resources, innovation can contribute to the push for a sustainable ‘green economy’. Boosting agricultural growth and turning farming into a modern and forward-looking occupation can help give a future to large young rural populations in developing countries.”

The G20 in session

The G20 in session

Consider them one by one. Whose evidence? That of the IFPRI, the CGIAR and its many like-minded partners the world over (they tend to have the same group of funding donors, this institutional ecosystem). A round-up of food policy by any outfit would have ordinarily included at least some evidence from the thousands of studies and surveys, large and small, humble and local, that discuss policy pertaining to food and cultivation. But, you see, that is not the CGIAR method. What we have then is the IFPRI view which, shorn of its crop science fig leaf, is similar to that of the Asian Development Bank’s view, the World Bank’s view, the International Finance Corporation’s view or the European Bank for Reconstruction and Development’s view (raise your fist in solidarity with the working class of Cyprus for a moment). And that is why the GFPR 2012 ties ‘investment’ to ‘evidence’, and hence ‘research’ to ‘food security’.

What research? Well, into “the emerging nexus among agriculture, nutrition, and health” naturally. This extends the CGIAR campaign that binds together cultivation choices for food staples, the bio-technology mittelstand which is working hard to convince governments about the magic bullet of biofortification (especially where cash transfers and food coupon schemes are already running), and the global pharmaceutical industry. It is really quite the nexus. As to food, water and energy, that is hardly an original CGIAR discovery is it, the balance having being well known since cultivation began (such as in the fertile crescent of the Tigris and Euphrates, about seven millennia ago, now trampled into sterility by ten years of an invasion, or as was well recognised by the peons of central America, an equal span of time ago, and whose small fields are being reconquered by the GM cowboy duo of Bill Gates and Carlos Slim).

What kind of ‘green economy’? Among the many shortcomings of IFPRI (in common with the other CGIAR components) is its studied refusal to incorporate evidence from a great mass of fieldwork that supports a different view. ‘Growth’, ‘modern’ and ‘forward looking’ are the tropes more suited to a public relations handout than an annual review of policy concerning agriculture and therefore also concerning the livelihoods and cultural choices made by millions of households. IFPRI’s slapdash use of ‘green economy’ reflects also its use by those in the circuit of the G20 and by the Davos mafia – they are the hegemons of politics and industry who force through decisions (they use sham consensus and gunpoint agreement) that have scant regard for climate change, biodiversity loss or dwindling resources. Hence the IFPRI language of “optimizing the use of resources”. The idea of unfettered growth as the way to end poverty and escape economic and financial crisis remains largely undisputed within the CGIAR and its sponsors and currently reflects the concept as found in ‘green economy’.

Food (trade and commodity) security.

Food (trade and commodity) security.

[The GFPR 2012 report and associated materials can be found here. There is an overview provided here. There are press releases: in Englishen Français and in Chinese.]

“Building poor people’s resilience to shocks and stressors would help ensure food security in a changing world”, the IFPRI GFPR 2012 has helpfully offered, and added, “In any case, poor and hungry people must be at the center of the post-2015 development agenda”. Ah yes, of course they must be, in word and never mind deed. “International dialogues, such as the World Economic Forum, the G8, and the G20, must be used as platforms to develop this concept, propose policy options, and formulate concrete commitments and actions to reduce poor people’s vulnerability to food and nutrition insecurity and enhance their capacity for long-term growth”.

To call the World Economic Forum, the G20 and the G8 ‘platforms’ and ‘dialogues’ is laughable, for there are no Southern farmers’ associations present, nor independent trade unions, nor members of civil society and community-based organisations that actually pursue, rupee by scarce rupee, the agro-ecological restoration of rural habitats in the face of migration, rural to urban, that occurs through dispossession, nor are there any of the myriad representatives of socialist and humanist groups whose small work has a restorative power greater than that of the CGIAR and its sponsors.

Never part of the CGIAR-IFPRI sonata that is played at these ‘dialogues’, there is ample evidence (since that is the theme) of locally articulated and politically wrested food sovereignty that can be held up as examples with which to reduce poor people’s vulnerability. In the past ten years, countries particularly in South America (we salute you, Hugo Chavez) have incorporated food sovereignty into their constitutions and national legislations.

In 1999 Venezuela approved by referendum the Bolivarian Constitution of Venezuela whose Articles 305, 306 and 307 concern the food sovereignty framework. In 2001 Venezuela’s Law of the Land concerns agrarian reform. In 2004 Senegal’s National Assembly included food sovereignty principles into law. In 2006 Mali’s National Assembly approved the Law on Agricultural Orientation which is the basis for implementation of food sovereignty in Mali. In 2007 Nepal approved the interim constitution which recognised food sovereignty as a right of the Nepalese people. In 2008 Venezuela enacted legislation to further support food sovereignty: the Law of Food Security and Food Sovereignty; the Law for Integrated Agricultural Health; the Law for the Development of the Popular Economy; the Law for the Promotion and Development of Small and Medium Industry and Units of Social Production. In 2008 Ecuador approved a new constitution recognising food sovereignty. In 2009 Bolivia’s constitution recognised the rights of indigenous peoples as well as rights to food sovereignty. In 2009 Ecuador’s Food Sovereignty Regime approved the Organic Law on Food Sovereignty. In 2009 Nicaragua’s National Assembly adopted Law 693 on Food and Nutrition Security and Sovereignty.

This is what true resilience looks and sounds like. For those unfortunate populations that continue to struggle under a food price inflation whose steady rise is aided and abetted by the CGIAR and its sponsors, the alternatives become clearer with every half percent rise in the price of a staple cereal, and with the loss of yet another agro-ecological farming niche to the world’s land grabbers.

The four degree doom

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Conducted by the Potsdam Institute for Climate Impact Research (PIK) and Climate Analytics in Berlin, the report, ‘Turn Down The Heat’, released this month just before the next round of climate change negotiations begin in Doha, Qatar, discusses bluntly the frightening risks of a future without climate policy.

There are several sharp and extremely urgent messages for politicians and policy-makers alike in the Potsdam report. Politicians, whether in the OECD countries or in the BRICS or in the G20, have proven themselves time and again, year after year, to favour the enrichment of themselves and their constituencies over any consideration of a shared planet and a cooperative future. What do we have left? Policy-makers, bureaucrats, NGO and community representatives and hundreds of thousands of concerned citizens in our countries, and so it becomes necessary that these are the people who read and digest what Potsdam has had to say.

What does the Potsdam Institute for Climate Impact Research and Climate Analytics have to say? “Humankind’s emissions of greenhouse gases are breaking new records every year. Hence we’re on a path towards 4-degree global warming probably as soon as by the end of this century. This would mean a world of risks beyond the experience of our civilisation – including heat waves, especially in the tropics, a sea-level rise affecting hundreds of millions of people, and regional yield failures impacting global food security.”

As usual, it is the poorest in the world are those that will be hit hardest, the researchers conclude, making development without climate policy almost impossible. But we have to ask – how possible is it with the current apology of climate policy? What is popularly called the “global community” by the world’s mainstream media (most of which is owned by corporations, politicians or both) is considered to have committed to holding warming below 2°C to prevent “dangerous” climate change. This is rubbish, and the Potsdam report all but says so: “The sum total of current policies – in place and pledged – will very likely lead to warming far in excess of this level. Indeed, present emission trends put the world plausibly on a path toward 4°C warming within this century.”

The increase in total ocean heat content from the surface to 2000 m, based on running five-year analyses. Reference period is 1955–2006. The black line shows the increasing heat content at depth (700 to 2000 m), illustrating a significant and rising trend, while most of the heat remains in the top 700 m of the ocean. Vertical bars and shaded area represent +/–2 standard deviations about the five-year estimate for respective depths. Chart: Potsdam Institute for Climate Impact Research (PIK)

As I am intimately concerned with agriculture and food and therefore the effects of a changing climate upon them, I turned to that section of the ‘Turn Down The Heat’ report (get the pdf here). The Potsdam researchers said that projections for food and agriculture over the 21st century indicate substantial challenges irrespective of climate change. They added: “As early as 2050, the world’s population is expected to reach about 9 billion people and demand for food is expected to increase accordingly.”

Here I found the first problem, and that indicated yet again that the climate scientists are good at modelling climate, but bad at understanding how the food system (not the natural one, the corporate one) actually works. What is more correct in my view is that primary agricultural produce at current levels is enough to feed a growing population for the next two generations provided (1) food crops such as maize are not grown to provide biofuel, (2) meat in all its hideous factory-farmed forms is drastically reduced in all agro-ecological regions, (3) the huge inventories held by the regional and global food processing and food retail industries are drastically cut down (that their businesses are shut down).

The Potsdam report continued that “based on the observed relationship between per capita GDP and per capita demand for crop calories (human consumption, feed crops, fish production and losses during food production)” it is reasonable (from the evidence it cites) to “project a global increase in the demand for crops by about 100 percent from 2005 to 2050”. It mentions “other estimates for the same period project a 70 percent increase of demand” and that “several projections suggest that global cereal and livestock production may need to increase by between 60 and 100 percent to 2050, depending on the warming scenario”.

Here I found the second problem. What is meant by these expert reports when they talk about the relationship between per capita GDP and per capita demand for crop calories? Beyond a localised recommended daily dietary allowance designed to provide proper nutrition, extra consumption of food calories (and protein and fats and sugar and micro-nutrients) can no longer be seen as expected to rise in parallel with rising income (where is income rising in real terms anyway, my thermometric friends, other than for the 1% who are causing most of this trouble in the first place?). The reform of diet and the return of local slow food is the answer to those complex, altogether unnecessary equations that posit 40%, 50%, 70% or 100% increases in food production over X, Y or Z years.

Then, the Potsdam report goes on to say that “the historical context can on the one hand provide reassurance that despite growing population, food production has been able to increase to keep pace with demand and that despite occasional fluctuations, food prices generally stabilise or decrease in real terms”.

Here I found the third problem and it is, as the more laid-back of Americans tend to say, it’s a doozy. What’s the historical context? Is it the Green Revolution by any chance? Is it the mutation of hybrid agri into bio-tech agri? Considering that the climate scientists are the ones who are very familiar with the gases now crowding our atmosphere, have they not made the connection between industrial, synthetic, high-external input agriculture and the nitrification of the atmosphere they’re so good at measuring? I’ll bet they are, so how can they point to the relentless growth of primary crop tonnage as a “reassurance” when it’s in fact the opposite?

That’s my quick reaction to the food growth part of what they have said. As for “food prices generally stabilise or decrease in real terms”, clearly they don’t consult even the mild-mannered FAO food price index, which has entered in 2012 November yet another month of its high plateau which makes it the longest sustained maintenance of elevated food price index since it began. The climate scientists are good at climate, but they surely need a crash course in understanding how the corporations and their patrons, those pesky politicians who are preparing for another jaw-jaw in Doha, exploit climate change for profit, and that includes making an extra penny out of a kilo of wheat flour, never mind the weather outside.

Written by makanaka

November 24, 2012 at 17:05

The IGC raises two bright red flags about world grain

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The European Commission’s directorate general of agriculture in its ‘Commodity Price Data’ 2012 August edition contains this chart on ‘cereals/bread and cereals-based products’ that their EU agricultural market and consumer price developments (this shows 2000 January to 2012 August data with the starting month representing the 100 of the index). This chart shows barley (the blue line) is at or near the 2007 peak and maize (the green line) is above the 2007 peak.

The Grain Market Report for 2012 October released a few days ago by the International Grains Council (IGC) makes two extremely important prognoses.

IGC’s 2012 October total grains chart

These two forecasts will have an immediate effect on grains prices as they are traded in the agricultural commodities markets through the winter season of 2012-13, and I expect we will see the effects in the major indices that describe the movements of food and of food prices – the FAO food price index, the World Bank ‘pink sheet’, the IMF commodity prices index, Unctad’s long-running series on agricultural commodities, and of course the various exchanges-based indices (DJ, CBOT, NYSE LIFFE and so on).

The IGC has cut a further 6 million tons (mt) from the 2012-13 forecast for total global grains production, which is now expected to be 5% lower year on year, at 1,761 mt. The decline includes 39 mt of wheat, 46 mt of maize, and 4 mt of barley. “Reduced availabilities and higher prices are expected to ration demand, resulting in the first year on year fall in grains consumption since 1998-99,” said the IGC in this month’s report.

IGC’s 2012 October wheat and rice charts

It is worth making the connection that the United States Department of Agriculture (USDA) in its recent ‘Wheat Outlook’, released on 2012 October 15 by the Economic Research Service, had said that global wheat production in 2012-13 is projected to reach 653.0 million tons, down 5.7 million tons this month (that is, 2012 October). The USDA’s 2012 October Wheat Outlook had said the “largest change this month is a 3.0-million-ton cut in projected wheat production in Australia to 23.0 million” and had added that “projected wheat production in Russia continues its decline as the wheat harvest gets closer to its end and projections for abandoned wheat area get higher, reaching 12% of planted area”. About the European Union (EU-27) wheat production for 2012-13 the USDA Wheat Outlook had reduced it 0.8 million tons to 131.6 mt, mostly because of a significant reduction for the United Kingdom (UK) (down 0.8 million tons to 14.0 million).

The IGC forecasts show a further tightening in the balance this month, with 2012-13 end-season total grains  stocks revised down by 4 mt to 328 mt (it was 372 mt the previous year), the lowest since 2007-08 – and we all remember well the global food price increases that set in during the 2007-08 season, and how the spikes of that period were quickly replaced from mid-2010 onwards by the sustained high plateau of food prices.

“Inventories for the major exporters will be even tighter and the smallest for 17 years,” the IGC has said in its 2012 October Report. The global year on year decline is forecast to come from a 24 mt reduction in wheat, an 18 mt decline in maize, and a 1 mt drop in other coarse grains, notably barley. Global grains trade is expected to fall by 19 mt from last year’s high, to 249 mt, with a particularly steep decline for wheat – down by 13 mt year on year, largely due to a forecast reduction in EU feed wheat imports against the backdrop of tight Black Sea supplies. (Also please see the European Commission’s directorate general of agriculture’s ‘Commodity Price Data’ 2012 August edition.)

Written by makanaka

October 28, 2012 at 20:44

Charting food price shock, and the World Bank’s economy with truth

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Chart source: World Bank (2011), ‘Responding to Higher and More Volatile World Food Prices’ Development Committee Paper prepared by the Agriculture and Rural Development Department using data from FAOSTAT for net cereal imports as a share of consumption and the USDA for food share in household expenditures.

The World Bank’s Food Price Watch for 2012 August has been released (it is a part of the Poverty Reduction and Equity Group’s Poverty Reduction and Economic Management Network). The Watch has in its overview mentioned prices of internationally traded maize and soybeans reaching all-time peaks in July. The rise in prices of wheat – comparable to the 2011 peaks – and the relative stability of the prices of rice have also been mentioned.

The Watch has said: “World Bank experts do not currently foresee a repeat of 2008; however negative factors — such as exporters pursuing panic policies, a severe el Niño, disappointing southern hemisphere crops, or strong increases in energy prices — could cause significant further grain price hikes such as those experienced four years ago.” This idea – of no repeat of 2008 – is plain wrong. The food price spike crisis of 2007-08 did in fact never go away, it subsided for some months, and has this year entered a new phase of pain for consumers particularly those in rural districts and the urban poor, wherever they may be.

As the chart (whose implications ought to be more seriously considered by the Watch, especially since the chart is a World Bank device itself) shows, countries in the Middle East and North and Sub-Saharan Africa are most vulnerable to this global shock. “They have large food import bills, their food consumption is a large share of average household spending, and they have limited fiscal space and comparatively weaker protective mechanisms,” the Watch has said.

Ideas such as ‘fiscal space’ and ‘protective mechanisms’ are not automatically translatable into household terms, and thus have no meaning for those who bear the food inflation burden first and the most. The Watch indeed has said that “domestic food prices in these regions have also experienced sharp increases even before the global shock due to seasonal trends, poor past harvests, and conflict”. Naturally, local circumstances determine how high domestic prices will be pushed from much higher international prices.

In addition to their effects on prices, previous droughts in developing countries have had severe economic, poverty and nutritional impacts, turning transitory shocks into lifetime and inter-generational perils, the 2012 August Food Price Watch has said, and this is certainly painfully true. The problem with the World Bank view (and practice) is when it becomes visible in the Watch with a statement like: “In such contexts, investments in drought-resistant crop varieties have provided large yield and production gains.” No, we do not want to see “investments in drought-resistant crop varieties” which only means thrusting GM seed into the fields of bullied smallholder farmers and GM food into the shops from which low-income households must buy their daily food basket.

Making sense of India’s credit rating palpitations

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The financial media in India and the mainstream English newspapers are sparing no effort to announce their alarm over the feint by a credit rating agency, Standard and Poor’s, to lower India’s sovereign credit rating. Standard and Poor’s (no, I don’t like the ampersand) is one of the three large agencies which the movers of global capital rely on to tell them where to move illusory money, the other two being Moody’s and Fitch.

As you can see from the tone and tenor of India’s craven business press – all of which are beholden to the country’s big corporations (cross-holdings are common) and which cheer every new sally in the direction of share bazaar capitalism made by the Ministry of Finance and Department of Commerce – their writers and columnists, their reporters and correspondents seem immobilised by rating fear.

The Business Standard reported: Global rating agency Standard & Poor’s on Monday cautioned India might become the first BRIC (Brazil, Russia, India and China) country to lose its investment-grade rating, unless growth issues were addressed immediately. The credit rating agency cited slowing GDP growth and political roadblocks in economic policy making as some of the factors that could lead to such an action.

The Mint commented: Some economists questioned the content and timing of the S&P report, titled Will India Be The First BRIC Fallen Angel?, which came some two months after the credit assessor lowered the outlook on India’s BBB- rating to “negative” from “stable”. The release of the report on Monday triggered a fall in the rupee and caused the benchmark index of BSE to slump. India was upgraded to investment grade in 2007. “In our view, setbacks or reversals in India’s path toward a more liberal economy could hurt its long-term growth prospects and, thus, its credit quality,” S&P analysts Joydeep Mukherji and Takahira Ogawa wrote in the research report dated 8 June.

The Economic Times commented: In an unusually direct reference to what it perceives to be poor quality of the nation’s political leadership, S&P has expressed concerns that ballooning government expenses, widening trade deficit and political vacuum could lead to protectionist policies. Prime Minister Manmohan Singh, whom the agency described as “unelected”, a reference to Singh’s membership of the Rajya Sabha, is battling more with party colleagues over policy than with cantankerous allies often blamed for policy paralysis, the rating agency said. It fears that government policies, which in some instances are aimed to benefit what the report refers to as “politically well-connected firms”, could result in a populist backlash against liberal economic policies. Heightened populism to counter the political fallout of corruption scandals could slow economic growth further, and weaken the already-battered fiscal position.

What do the credit rating agencies do for India? What do these three (and their counterparts in India) have remotely to do with the lives and well-being of the 800 million rural Indians (there are 355 districts whose populations are over a million), or the urban poor in India’s 53 million-plus cities? They are among the tools with which ‘reform’ is grafted onto a country in order to further immiserate the poor and annex natural resources for a global upper middle class whose ranks are being swelled by India’s new rich. They are among the staunchest advocates of ‘austerity’ in the belief (backed by kilogrammes of elegantly designed working papers from the International Monetary Fund and the World Bank, and yes the Asian Development Bank too) that such measures revive investor confidence. Credit rating agencies are the canaries of this intangible called investor confidence, and it ought to be seen as an intolerable affront to India that our people and our myriad economies are to be encapsulated – absurdly and so irrelevant – by the meaningless equations of Standard and Poor’s and its cousins.

“It is a hallmark of the crisis, that every effort the government makes to end it, within “neo-liberal” framework, will only succeed in worsening it,” said Prabhat Patnaik in ‘The End of the “Shine”‘ (People’s Democracy, 10 June 2012). The role of these agencies is to legitimise the enticement of finance back into an economy to keep its bubble spherical. Hence the worried tones of India’s business press, because far more worrying to them (as it is to the 5% of urban Indians who are the audience for this media, who control the flows of money and commodities and who exercise political power) is the spectre of a collapsed bubble being beyond recovery. That is why, every effort on the part of the government to tighten monetary policy in the belief that this would curb inflation and revive ‘investor confidence’ (currently viewed by the ruling alliance with more reverence than it accords to India’s Constitution) will hasten the economy’s downturn.

These are not uncoordinated gambits. In the latest issue of the IMF’s journal, Finance and Development, an article has discussed how “the relatively low-hanging fruit has been picked, and the harder, more exacting, job of addressing tougher problems lies ahead”. (The language sounds neutral but is loaded with violence.) The article goes on to outline an incomplete reform list: “identifying and building tools — still in the early stages of development — to mitigate systemic risk; improving the ability of the authorities to deal with the aftermath if the tools designed to prevent systemic events fail; and providing a framework for financial intermediation (the transfer of savings to investments) to assist in strong and stable economic growth, without overly prescriptive regulation.”

The IMF likes credit rating agencies; they are invaluable for the Fund’s agenda. Their work allows borrowers “to access global and domestic markets and attract investment funds, thereby adding liquidity to markets that would otherwise be illiquid”. The IMF’s Global Financial Stability Report 2010 (Chapter 3), ‘Sovereigns, Funding and Systemic Liquidity’ (2010 October), had said that these ratings “influence market prices, and that downgrades through the investment-grade barrier trigger market reactions… shows that their market impact is associated not only with new information, but also with a ‘certification’ role, though this is most evident through their use of ‘outlooks’, ‘reviews’, and ‘watches’ (pre-rating change warnings) rather than actual rating changes”.

Not content with the sophistication of the regime denoted by the alphabetic identifiers such as AAA, AA or BBB  and the pluses and minuses appended thereunto or removed therefrom – or more likely anticipating that the means used to ‘tend’ bubbles by the agencies was as likely to be used as political ammunition as it was to be cunningly exploited by the commodity traders and their money market partners – India’s Ministry of Finance this year developed an index of relative ratings of sovereigns. This it has called the Comparative Rating Index of Sovereigns. What will such an index serve? “Given that existing ratings do not give an idea of the inter se rankings of various economies with respect to the performance of the others, this index addresses an important conceptual lacuna,” the paper has explained. “The results reveal major changes in relative ratings of various countries, driven largely by the rapid downgrades of some European economies following the global financial crisis.”

And so we have the ‘Comparative Rating Index for Sovereigns (CRIS): A Report Based on “The Relativity of Sovereigns: A New Index of Sovereign Credit Ratings and an Analysis of How Nations Fared over the Last Six Years’ (2012 March). This is the ‘let’s pat ourselves on the back regardless of what the rating agencies say’ argument, and it is a sorry effort to lend an ephemeral shine to the old India Shining metaphor (insubstantial as that was, overused as it came to be). That is why the outcome of this indigenised index is that “India’s Comparative Rating Index for Sovereigns has improved over the six years from 2007 to 2012 by about 2.98% while its rank moved up from 61st to 55th… The US has gone from the top of the chart to the 13th position though it still improved its CRIS score by 2.12%… Some of the largest falls were among European economies and Japan. Greece fell by 71 positions, Ireland 68, Iceland 61, Portugal, 53, Spain 36 and Japan 21. BRICS economies show continuous improvement and the global financial crisis does not seem to have impacted them adversely in terms of CRIS scores”.

A counter index to nullify the unattractiveness of the credit ratings own indices – ratings that are meaningless to Bharat and its people. If we needed more evidence that our major ministries are populated by lotus-eaters – as is the Planning Commission and its opulent toilets – this is it.