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Subject CFR: Daniel Gustafson on U.S. Food Policy
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Original Message Global food prices have continued to rise, placing an extra burden on the poor. The World Food Program (WFP), a UN humanitarian agency, in March 2008 announced a shortfall of $500 million and could have to ration food aid. Daniel Gustafson, director of the Washington office of the UN Food and Agriculture Organization, says the price increase is due to a confluence of events, including increased demand for meat worldwide, high energy prices, bad harvests in some countries, and the advancement of corn-based ethanol as an alternative fuel. For the world’s poor, those in developing countries who typically spend 70 percent to 80 percent of their entire income on food, he says “anything that relates to an increase in food prices can be a disaster for them.”

On the plus side, Gustafson says overall high prices will accelerate changes in trade regimes to help lower trade barriers. Gustafson notes a “critical change” in the proposed U.S. farm legislation (PDF) that would allow 25 percent of food aid to be purchased from local countries rather than being forced to rely on U.S. cereals. He says the next administration will want to see agriculture policy play a more prominent role in the development agenda. First it should look at the emergency food needs and the impact of high prices, then at access to food and better nutrition, and finally at investments in agricultural infrastructure.

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