High food prices likely to persist: World Bank - Emirates24|7

High food prices likely to persist: World Bank



Rising food prices, which have caused social unrest in several countries, are not a temporary phenomenon but are likely to persist for several years, World Bank President Robert Zoellick says.


He says strong demand, change in diet and the use of biofuels as an alternative source of energy have reduced world food stocks to a level bordering on an emergency.


Speaking to reporters on Monday before the bank’s spring meeting in the coming weekend, Zoellick said the 185-member World Bank would work with other organisations to deal with the crisis by seeking ways to help farmers, especially in Africa, to increase productivity and improve access to food through schools or workplaces.


“This is not a this-year phenomenon,” he said, referring to the price spike. “I think it is going to continue for some time.”


Zoellick said bank forecasters looking at food prices have concluded that a serious risk exists of a significant increase in poverty, which for some countries will reverse gains made over the past five to 10 years.


“A recent assessment in Indonesia shows that over three quarters of the poor are net rice buyers, and an increase in the relative rice price by 10 per cent would result in an additional two million poor people, about one per cent of the population,” he said.


Zoellick said in some developing countries the new face of hunger and malnutrition can be found in urban areas, where food is available but people cannot afford it.


In a speech last week Zoellick called for a “New Deal for Global Food Policy” that would aim to boost agricultural productivity in poor nations. He said the bank would lend almost twice as much money for agriculture in Africa – from $450 million (Dh1.65 billion) to $850m (Dh3.12bn).


He also would like to see major government-owned sovereign wealth funds of Asia and the Middle East to join with the bank and invest in Africa.


Zoellick said the bank could help African countries set up institutional and regulatory systems that would make investors comfortable with putting their money to work in these nations. (AP)