EDITORIAL

Will the Food and Agriculture Organisation's recent report on the "State of Agricultural Commodity Markets 2004" prove an eye-opener for all those who may yet be in a position to save billions of people in the poorest countries, sooner or later, from starving to death? For as revealed, the trade barriers, subsidies in industrialised nations, and a 40-year decline in real prices of commodities, has depleted the lone source of cash income for many of them, that is, all those who owe their subsistence to farming. In so analysing their predicament and tracing it to subsidies in European Union, United States, and other rich nations - to the accompaniment of tariffs on agricultural imports, it will be seen to have rightly put the blame on them for causing severe distortions in world markets and farm trade.
The FAO also noted that support for farmers in industrialised nations was equivalent to 30 times the aid provided for agricultural development in developing countries. Viewed in the perspective of 230 billion dollars paid to farmers in wealthy countries, it will, understandably, be seen to add to the burden of declining commodity prices, thereby, constantly threatening the livelihood of the poor farmers in the developing world. Moreover, according to the report, over 50 developing countries, including most of the poorest ones, depend on exports of up to three farm commodities for 20 to 90 per cent of their foreign earnings. It will also be noted that for these disadvantaged people, it said that developments on international commodity markets could spell the difference between affluence and paucity.
As it explained, the least developed countries had also found their share of world agricultural trade shrinking, with losses of income and employment caused by falling prices outweighing likely benefits to the majority of the poorest consumers. Comparatively, it also noted that the main beneficiaries of lower food prices have remained the consumers in the developed countries, as also in the slowly urbanizing areas of the developing nations. All in all, these unchanging trends would little to doubt that only marginal gains accrue for such developing countries engaged in boosting their agricultural economies through efforts aimed at improving productivity, and value-addition through food processing. Significantly, it also observed that as agricultural commodity prices had plunged to their lowest since the Great Depression of the 1930s, subsidies further added to the overall squeeze, thereby, adversely affecting developing countries desperately striving to export commodities like cotton, sugar and rice, without much avail though.
As for the tariff barriers, particularly, surrounding major consumer markets these have rightly be seen as hampering a number of developing countries to expand exports of processed foods and developing domestic food industry. Reference, in this regard, may also be made to the minor difference made in the plight of the affected countries through the help of multinationals to some small-holders, to move into the world markets and to modernise production technology in some of the poor countries. Analyzing the trend the report has also pointed out that three companies now alone account for almost half the coffee roasting in the world. For as it has pointed out, 30 supermarket chains control "almost one third of grocery sales world-wide." Needless to point out, in the final analysis the prospects of the world's predominantly agricultural economies, will still appear to be quite bleak, irrespective of all the make-believe emphasis on development efforts to the accompaniment of social and political reforms on typical western lines.
As such, the FAO will be seen to have rightly urged the World Trade Organisation to strive for an early and unfailing end to the much hampered agricultural talks in such a way as to facilitate access of developing countries to the world markets.