Rich nations $250bn agriculture subsidies hurting poor growers

Published October 17, 2015
Wealthy nations spend 20 times more on farm subsidies than the $12bn they allocate to support for poor farmers annually.—APP/File
Wealthy nations spend 20 times more on farm subsidies than the $12bn they allocate to support for poor farmers annually.—APP/File

TORONTO: Rich nations are spending $250 billion annually subsidising their agricultural sectors to the detriment of poor farmers as they artificially lower prices for some crops and block market access for growers from poor countries, a new study said.

Wealthy nations spend 20 times more on farm subsidies than the $12bn they allocate to food aid and support for poor farmers annually, John McArthur, a senior fellow with the Brookings Institution, the think-tank which led the new research, said on Friday.

Japan spends 59 times as much supporting its own farmers than on food aid and nutrition support, while countries in the European Union spend 42 times as much and the United States spends 16 times as much, the Brookings Institution study said.

“There are a lot of ways countries can give artificial support for their own farmers, hurting farmers in Asian or African countries who could supply that (product) for better value,” McArthur told the Thomson Reuters Foundation.

Subsidies from the 31 members of the Organisation for Economic Cooperation and Development (OECD), a group of wealthy countries, included direct payments to farmers, trade barriers to food from poor countries, and mandates for biofuels, he said.

These supports for farmers in wealthy countries can hinder food production in developing states, by artificially allowing food to be sold on international markets below the cost of production, hindering access for unsubsidised growers.

This process, known as “dumping” in international trade, discourages poor farmers from investing in their operations or ramping up production as they cannot fairly compete with subsidised crops. This in turn hurts food security in poor countries.

But it is not only rich-world subsidies that hurt poor farmers. Countries in Africa and Asia also need to invest more in infrastructure, fertiliser and crop insurance to help growers reach their potential to feed the 795 million worldwide who don’t have enough to eat.

Undernourishment in the developing world has been falling by roughly one percentage point every three years.

But to eliminate hunger entirely by 2030, in line with UN Sustainable Development Goals, the speed of hunger reduction needs to significantly accelerate, McArthur said.

In Africa, the continent hit hardest by a lack of food and poor crop yields, some countries, such as Ethiopia, Malawi and Ivory Coast, have made major progress in the last decade, he said.

Published in Dawn, October 17th, 2015

On a mobile phone? Get the Dawn Mobile App: Apple Store | Google Play

Follow Dawn Business on X, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Tax unrest
Updated 14 Jul, 2025

Tax unrest

Govt has a very poor track record of staying the course of tough decisions that affect the ruling party’s core political base.
Surging numbers
14 Jul, 2025

Surging numbers

PAKISTAN is running out of time — and space. Our population, now over 240m, continues to grow at nearly 2pc a ...
Media matters
14 Jul, 2025

Media matters

PAKISTAN’s journalists are no strangers to living dangerously. The Freedom Network’s new report, Journalism in...
Hybrid worries
Updated 13 Jul, 2025

Hybrid worries

Once elected office is reduced to theatre, useful only for maintaining appearances, it becomes a stage for managing perceptions rather than exercising power.
Bitter taste
13 Jul, 2025

Bitter taste

THE government’s plan to import 350,000 tonnes of sugar, months after allowing the export of more than twice that...
No red lines
13 Jul, 2025

No red lines

THE US’ move to sanction Francesca Albanese, the UN’s Special Rapporteur on human rights in the occupied...