ISLAMABAD, Oct 15: As the current fluctuation in food prices is posing a threat to food security in developing countries and pushing millions of people into extreme poverty, World Food Day is being observed on Sunday to give a serious thought to the causes of swings in the food prices.
Economists believe that the price roller-coaster experienced in 2006 would recur in the coming years. In other words, food price volatility â€“ the technical term for the phenomenon â€“ would stay longer.
The UN Food and Agriculture Organisation (FAO) in its 'State of Food Insecurity in the World 2011' report states that food price volatility featuring high prices is likely to continue and possibly increase, making poor farmers, consumers and countries more vulnerable to poverty and food insecurity.
Price volatility makes both small farmers and poor consumers increasingly vulnerable to poverty while short-term price changes could have long-term impacts on development, the report says.
The estimate of the number of hungry people for 2010 by FAO remains at 925 million. For the 2006-2008 period, the UN food agency calculates the number of hungry at 850 million.
“Food prices â€“ from crisis to stability” has been chosen as this year's World Food Day theme to shed some light on this trend and to ascertain what can be done to mitigate its impact on the most vulnerable. In Pakistan, World Food Day will be marked at a ceremony to be held at NARC on Sunday.
The World Bank says Pakistan has not only imported higher inflation from international commodity prices, but macroeconomic imbalances and the floods of 2010 also provided domestic sources for price rise.
Inflation hovered around 25 per cent from mid-2008 to early 2009, came down somewhat at the end of 2009, but is now again over 14 per cent, the highest in the region. The surge after January 2011 resulted from supply shortages mainly in food items after the devastating floods of 2010.
Since the last food price spike in 2008, governments in South Asia have strengthened safety nets, but gaps continue to exist. The largest safety net interventions in the region - India's and Pakistan's public distribution systems for staple foods - are characterised by high leakages and therefore costs, while errors of exclusion are actually larger than the reverse, as a result a large number of the deserving poor is not covered, World Bank says.
Pakistan experiences the highest net percentage increase in the poverty headcount whereas Bangladesh experiences the highest percentage increase in the poverty gap due to the food price increase. Across all the South Asian economies, the median of people exiting poverty is 0.06 per cent while those entering poverty are 1.49 per cent, driving 15 million South Asians into poverty.
the South Asia Human Development Report 2010-2011 says that access to food by people in Pakistan was becoming difficult day by day in the backdrop of inequitable distribution of economic resources together with inflation outpacing growth in income.
The report published by Mahbub-ul-Haq, Human Development Centre regrets to note that the real purchasing power of people in Pakistan has recorded a decline since the rise in income has been outpaced by inflation.
An analysis of average income by income quintiles shows that the richest 20 per cent, both in urban and rural areas, has more than three times the average income levels of the lowest 20 per cent. Thus the income inequality has gone up, the report points out.