Sunday, June 22, 2008
CNA (Taiwan)
TAIPEI, Taiwan -- An organization to be formed by rice exporting countries in Southeast Asia will further worsen the current worldwide shortage of food, a Taiwanese economic expert said yesterday.
The warning came after Thailand's Prime Minister Samak Sundaravej proposed on April 30 the establishment of the Organization of Rice Exporting Countries (OREC) by 2012.
The OREC -- which will also include Vietnam, Cambodia, Laos and Myanmar -- might become a cartel that fixes global rice prices similar to the way the Organization of Petroleum Exporting Countries (OPEC) sets oil prices, said Tu Chaw-hsia, deputy director of the Chung-Hua Institution for Economic Research's Taiwan WTO Center.
Tu said that the cartel would very likely affect the pricing mechanism now driven by supply and demand in global food markets in the future.
This would violate the basic principles and rules of the World Trade Organization (WTO) aimed at promoting free trade, Tu said in her article published in the latest issue of the institution's biweekly Chinese-language journal.
She cited many factors contributing to soaring global grain prices, including the decreasing production of grains in some areas due to climate issues.
Also contributing to higher prices, Tu said, have been moves by many countries to turn crops into biofuel and the rising demand for grains in the emerging markets of China and India.
Global prices of grains began rising moderately in 2002, but have grown rapidly since 2007, Tu observed.
Citing data from the World Bank, Tu said that global prices of grains rose an average of 83 percent over the past three years, substantially lowering the ability of poor countries and low-income earners to buy the dietary staples.
To resolve the food shortage at home, some countries have already banned rice and wheat from being exported or started distributing grains and food, Tu said.
In addition, grain prices might soar further as the United States and European countries have promised to slash farm subsidies, she said.
The promise was made during the ongoing Doha Round of WTO negotiations, in which developing countries strongly criticized developed nations' use of subsidies to prop up their higher-cost agricultural sectors, Tu said.
The subsidies, they argued, have long kept international agricultural commodities so cheap that developing countries cannot compete, Tu said.
Meanwhile, worldwide food shortages have already sparked violence in dozens of developing countries, and Tu said that the problem, if left unsolved, might cause hunger and large-scale epidemics.
The violence is also largely the result of uneven distribution of wealth and income inequality, Tu said, describing these problems as hard to avoid in a highly globalized and liberalized world.
She said the international community now faces the challenge of working together to enhance the development of developing countries and reduce the gap between the rich and the poor.
The warning came after Thailand's Prime Minister Samak Sundaravej proposed on April 30 the establishment of the Organization of Rice Exporting Countries (OREC) by 2012.
The OREC -- which will also include Vietnam, Cambodia, Laos and Myanmar -- might become a cartel that fixes global rice prices similar to the way the Organization of Petroleum Exporting Countries (OPEC) sets oil prices, said Tu Chaw-hsia, deputy director of the Chung-Hua Institution for Economic Research's Taiwan WTO Center.
Tu said that the cartel would very likely affect the pricing mechanism now driven by supply and demand in global food markets in the future.
This would violate the basic principles and rules of the World Trade Organization (WTO) aimed at promoting free trade, Tu said in her article published in the latest issue of the institution's biweekly Chinese-language journal.
She cited many factors contributing to soaring global grain prices, including the decreasing production of grains in some areas due to climate issues.
Also contributing to higher prices, Tu said, have been moves by many countries to turn crops into biofuel and the rising demand for grains in the emerging markets of China and India.
Global prices of grains began rising moderately in 2002, but have grown rapidly since 2007, Tu observed.
Citing data from the World Bank, Tu said that global prices of grains rose an average of 83 percent over the past three years, substantially lowering the ability of poor countries and low-income earners to buy the dietary staples.
To resolve the food shortage at home, some countries have already banned rice and wheat from being exported or started distributing grains and food, Tu said.
In addition, grain prices might soar further as the United States and European countries have promised to slash farm subsidies, she said.
The promise was made during the ongoing Doha Round of WTO negotiations, in which developing countries strongly criticized developed nations' use of subsidies to prop up their higher-cost agricultural sectors, Tu said.
The subsidies, they argued, have long kept international agricultural commodities so cheap that developing countries cannot compete, Tu said.
Meanwhile, worldwide food shortages have already sparked violence in dozens of developing countries, and Tu said that the problem, if left unsolved, might cause hunger and large-scale epidemics.
The violence is also largely the result of uneven distribution of wealth and income inequality, Tu said, describing these problems as hard to avoid in a highly globalized and liberalized world.
She said the international community now faces the challenge of working together to enhance the development of developing countries and reduce the gap between the rich and the poor.
2 comments:
I do not fully agree with this author.
It is unfair for agricultural countries like Cambodia. It is a chance to enhance its economic by boost it products. Why don't you badly blame oil rich countries for recent month oil price? so far Cambodia a also a big export rice country but due to lack of figuer recorded and most of it products sell to neighbor countries, the world see Cambodia is a small rice exporter.
Now Cambodia starts to controll it product. A good move to help other, Cambodia sell its rice to Senegal and will also sell to Guinea in Africa and We will sell to more countries in the world as we can.
Yep!
Post a Comment