Cut food prices - Cut tariffs and subsidies
IPN Press release
Rising food prices have caused street protests from Mexico to India to Senegal. US and EU ethanol subsidies are partly to blame. But by imposing tariffs on imports and exports, the governments of poor countries are at least as responsible.
“A whopping 70% of the world’s trade barriers are imposed by governments of poor countries,” said Alec van Gelder, Network Director of International Policy Network: “Governments that really care about their people would remove those tariffs immediately.”
· The Indian government imposes average tariffs of over 60% on agricultural goods
· According to the UN FAO there are 200 million underfed people in Africa, yet average tariffs on agricultural goods between Sub-Saharan African countries are 34%.
· Nigeria has actually banned imports of various staples at different times, including wheat, rice, maize and vegetable oil.
· The removal of tariffs on fertilizer and other agricultural inputs would lead to increased crop productivity, improving the lives of farmers and reducing further the cost of foodstuffs.
· Average fertilizer use in poorer countries is 107kg per hectare. In Africa it is only 8kg (yes, eight). Tariffs on fertilizer imports are a major reason for this low use-rate.
· The removal of subsidies to biofuels (including requirements to include a proportion of such fuel in petrol and diesel – such as those being implemented in the EU) would also reduce food prices and must be a priority for rich countries.
· Some countries have recently imposed tariffs and bans on exports of foods. While such trade restrictions temporarily reduce local prices, they increase prices in importing countries, result in reciprocal bans, and reduce the incentives to produce those foods in the next season – leading to reduced global supplies.
“Reducing agricultural trade barriers would increase supply and reduce the cost of food, benefitting the very poorest people in the world,” Caroline Boin, IPN’s Environment Programme Director said.