|
Challenges, and Solutions in Jordan and the Arab World 5 July 2008
The rise in prices, especially of basic food items, represents a major challenge to the Arab world and many countries. The total food gap value in the Arab world has continued to mount as it reached $2.4 billion in the early 1970s, going up to an average of $12.5 billion in the 80s and 90s, and growing to $18 billion in 2006. The Arab world is witnessing a food crisis and a tremendous rise in the prices of strategic goods, such as grains and oils as well as in production costs, mainly fodder, fertilizers and fuel. The broadening of the total food gap value has burdened consumers, agricultural producers and the balance of payments in many countries, especially in the light of the increasing repercussions of the general market instability on the social and political systems. A social reading indicates an increasing possibility of instability in the non oil producing Arab countries, due to the acceleration of the rise in the prices of strategic goods especially food items. The current inability of agriculture and industry to meet the citizens' needs of the food items and strategic goods is a contributory factor. Another repercussion is the growth of the poor around the globe to 100 million, increasing the deficit in the world aid organisations budgets to 40%. The crisis was seen by the participants as global, real and significant, because the importance of the agriculture sector in the GDP results from the correlation of farming activities, along with other related industries, services and input, and the GDP. Poor countries of the world, including Arab states, were more strongly and clearly affected than rich and powerful countries for two main reasons. On the one hand, the rich countries' food industries have a great capacity to cope with the deficit and follow strong economic policies to deal with crises. Poor countries are helpless because they depend for their food on imports from several countries and lack strong economic policies to face the crisis. The participants argued that, despite the fact that global economic policies do not commit themselves to ethics in trade dealings where monopoly and illegal speculation take place, there are other reasons which need to be explored. These include the neglect of improving the policies of food production, ways of rationalised consumption and new ways of purchasing. There is also the direct impact of the global rise in oil prices, as most food products depend on oil in their production process, such as the use of farming instruments, transformation to direct food, packaging, transportation, etc. Another reason for the crisis to escalate, is the climate change in some of the producing and exporting countries of food items like rice, wheat and corn oil. Australia, for example, suffered two dry years, which reduced production of wheat and rice and its export. Thailand and China also suffered from reduced production and exports. An important factor is the use of bio-fuels to counter the rise in oil prices. Oil prices have increased so much that a number of countries have used food needed by the poor as a bio-fuel to replace oil. According to 'Scenarios for the Global Economy for 2008', a World Bank report, the use of food crops to produce bio-fuels is responsible for approximately 50% of the rise in the prices of basic food items. It has also caused a shift in the consumption pattern of several populations, since some of them – including those of the Arab world – spend a great portion of their incomes on food. The demand for unnecessary consumer goods has increased as well. The participants criticised the governments' decreasing support of the agriculture sector as well as the approaches taken by both the European-Arab partnership agreements and the WTO systems, calling these governments to meet their responsibilities. The participants discussed Arab food integration in connection with the needs, requirements and challenges mainly after the recommendation of the Riyad Summit in March 2007 for a strategy for developing agriculture and achieving food security in the Arab world. The participants agreed that integration is necessary to confront the global crisis. The Arab world has the resources to deal with this problem if it wishes. For instance, farmed land represents 5% of all Arab land whereas the land suitable for farming is 35% of which only 10% has been farmed. Furthermore, like Sudan – which is called 'the Arab world food basket' – some Arab countries provide land for investment and exploitation for both the Arab public and private sectors. However, even Arabs do not think of it as the Arab world food basket and, therefore, billions of dollars are not given to Sudan for agricultural and animal investment. A pan-Arab plan is recommended to develop economic, agricultural and industrial integration policies to achieve self-sufficiency. In spite of the theoretical potential for Arab food integration, there are obstacles, some related to programs and others to nature itself. On the political level, the participants believed that the political will is the biggest challenge to integration. Therefore, the results of the Riyad Summit were seen as achieving integration, but the Arab countries progress towards a common market has been very slow. The agriculture sector suffers from the problems of financing, dealing with foreign markets, improper practices towards the land and farming, and the education systems which do not pay due attention to the importance of land. A number of participants referred to the decrease by more than 50% in the food businessmen's purchasing power in Jordan and the Arab world, leading to difficulty in reducing to reasonable prices, especially due to the decline in imports. The inflation rate has increased in many Arab countries, even oil-producers. Governmental measures to control it especially in these sectors like real estate and imported food – are not yet efficient. The Arab world has problems, like lack of water, a decrease in the rainfall and farming land used for construction, which make it harder to confront the crisis. The participants emphasized the problems faced by poor countries without oil, like Jordan and Yemen, and the additional problems faced by states with large populations like Egypt and Morocco. They cannot behave like oil rich countries which increase wages in the public sector and urge the private sector to increase wages. These increases will not solve all problems, but they may contain them. The way Arab governments dealt with the crisis by assisting individual citizens instead of initiating economic policies, agricultural programs or rationalised consumption legislations. The crisis is likely to continue and the governments and peoples are expected to remain dependent on wage increase policies rather than alternative plans. Therefore, the participants argued that, in order for the Arab world to alleviate the consequences of the crisis, new economic and agricultural policies need to be set which would support agriculture and rationalise consumption. Legislation has to be put into effect which supports the agriculture sector and promotes investment in the food industries sector, whether by individual countries or collectively. The participants said all parts of society and government must work together to make a package of political, social, economic, and educational measures in order to minimise economic damage and the risk of political instability in the Arab world. The participants believed that Jordan is far more affected than other Arab countries for economic, social, environmental (climate and land) and other reasons, but many of these problems can be dealt with. Therefore, the recommendations focused on cooperation between the government and decision-makers in the private agriculture and economy sectors; the support of economic and agricultural policies beneficial to the country; and the directing of society to deal effectively with the crisis on an individual or family level. The real victims are those who suffer the consequences, not those who cause the crisis. Finally, the participants made a number of recommendations to help the Arab world and Jordan overcome the crisis. 1 An Arab summit to discuss agriculture and food security to maintain economic, social and political stability. 2 Initiate an Arab integration plan, starting with the Arab free-trade zone; to the customs federation; to a common Arab market to an economic federation, ending up with a monetary and political union, as developed in Europe over 50 years. 3 Introduce legislation supporting agriculture and farmers, and prevent the negative impact on agriculture from other sectors thus protecting the consumer from monopoly and profiteering. 4 Maintain public property and support education, health, agriculture, food and fuel production. 5 Activate direct, fruitful cooperation with the Sudanese Republic – the Arab world food basket – in a bid to exploit its land, and look for similar opportunities in Algeria. 6 Call for a change in development and agricultural policies, and the enhancement of social security networks. 7 Create balance between the producer and the consumer. 8 Create an advanced alarm system to predict and pre-empt crises, especially for food and basic needs. 9 Call for tax exemption in the agriculture sector and food industries in order to reduce food prices. |
||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
