Abstract
The world food price spike of 2007–2008 raised to the fore the issues of how countries can manage their basic staple food imports in times of crises. There are many risks to food imports, ranging from price risks to risks of non-performance and hence threats to domestic food supplies. The chapter first provides a review of the risks and food import access problems faced by various low and middle income net food staple importing countries and reviews pertinent policies to deal with them. A short review of some institutional issues in food importing is given to introduce more detailed discussion of food import risk management. Then a proposal for a food import financing facility designed to alleviate the financing constraint of many developing food-importing countries is presented.
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- 1.
LIFDCs are a FAO classification. The latest list of May 2009 includes 77 countries. The list of LDCs is one used by the United Nations (UN) and as of May 2009 includes 50 countries. All but 4 LDCs are also included in the LIFDC list. The list of NFIDCs is a World Trade Organization (WTO) group, which as of May 2009 includes all 50 LDCs and another 25 higher income developing countries, for a total of 75 countries. Of the 25 extra countries in this list only 8 are in the FAO list of LIFDCs, the others being higher income countries. The Low Income Countries (LICs) is a World Bank classification of 53 countries that overlaps significantly with the UN list of LDCs.
- 2.
This section draws on an unpublished note (FAO and UNCTAD, 2005) co-authored by the author of this chapter.
- 3.
This is a mechanism used for example in the United States to enable domestic banks to provide more rural loans and mortgage loans to smaller clients, with public institutions such as FannieMae providing a refinancing facility to these banks.
- 4.
Alternatively, if the guarantees that it receives are good enough, the FIFF could be allowed to become self-financing in a manner similar to the World Bank, that is to say, it would be able to borrow cheaply against the guarantees even when LDCs and NFDICs do not require the support, and place the funds in higher-earning assets.
- 5.
The full details of the methodology as well as more empirical results can be found in Sarris (2009b).
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Acknowledgement
Paper presented at the workshop on “Methods to Analyze Price Volatility” organised by the Institute for Prospective Technological Studies, of the EU Joint Research Centre, in Seville and held in Seville Spain on 28–29 January 2010.
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Sarris, A. (2011). Global Food Commodity Price Volatility and Developing Country Import Risks. In: Piot-Lepetit, I., M'Barek, R. (eds) Methods to Analyse Agricultural Commodity Price Volatility. Springer, New York, NY. https://doi.org/10.1007/978-1-4419-7634-5_11
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