Food crisis gatecrashes
ADB By Marwaan Macan-Markar
MANILA - Three words - high food prices -
emerged like a gatecrasher at an event hosted by
the Asian Development Bank (ADB) in the
Philippines capital that was originally billed as
a celebration of the bank's new vision for poverty
eradication in Asia. Participants at the event
in Manila discussed the ADB's "Strategy 2020", the
long-term strategic framework (LTSF) for 2008-2020
period, and raised the alarm about the current
global food crisis. It is a reality that the bank
cannot ignore, they said, in light of the millions
who could be condemned to a life of hunger and
poverty in the region.
"The rising food
prices are a threat to food security and a threat
to poverty reduction, and we stress that food
security must be
adopted as a challenge of
the LTSF," Duvvuri Subba Rao, finance secretary at
India's finance ministry, said during a Sunday
morning seminar for the central bank governors of
the ADB's 67 member countries.
Supachai
Panitchpakdi, secretary general of the United
Nations Conference on Trade and Development, spoke
along the same lines: "The food crisis cannot be
remedied through emergency measures. We have to
put back money in rural development," he said.
The comments were echoed by a ranking
finance official from Bangladesh, who said that
"the food problem is not a cyclical problem but a
structural problem".
Such concerns exposed
a deep flaw in the bank's new quest to direct
development in Asia. The LTSF makes little
reference to aiding the continent's agriculture
sector, yet rural areas are home to a majority of
the 600 million Asians living in absolute poverty,
on less the US$1 a day.
The LTSF, which
was approved in March, places stress on five
"drivers of change" to achieve "An Asia and
Pacific free of poverty" by 2020. These drivers
are:
Private sector development and private sector
operations
Good governance and capacity development
Gender equity
Knowledge solutions
Partnerships
In addition, "inclusive
growth, environmentally sustainable growth and
regional integration" will feature as the bank's
"three strategic agendas".
ADB president
Haruhiko Kuroda was forced to admit this lapse by
an institution that, for over 40 years, has been
the premier lender of grants and loans for
development in the Asia-Pacific region. "As you
look at the LTSF, certainly the five core areas do
not include agriculture. But there is a paragraph
about agriculture [in the text]," he said during
the seminar. "ADB can support agriculture through
infrastructure, rural roads as well as rural
finance," he said.
The concern in the food
scarcity greater than that indicated in the LTSF
was set on Saturday, the opening day of the ADB's
41st annual meeting of its governing board, which
runs from May 3 to 6. During a late morning press
conference, most of the questions Kuroda had to
field were on food shortages. The bank itself
released a 15-page paper on the subject, "Soaring
Food Prices - a Response to the Crisis".
The annual meeting has attracted more than
3,000 participants, ranging from finance ministers
and central bank governors, to industrialists,
bankers, academics and civil society activists.
Non-governmental organizations (NGOs) are
not surprised by the dilemma the ADB faces at this
meeting, which was meant to showcase the virtues
of the LTSF.
"The food crisis has
overshadowed the message that the ADB wanted to
send out of this meeting," says Mishka Zaman, Asia
program manager of the Bank Information Center, a
development watchdog based in Washington DC. "The
concerns about food security have relegated the
LTSF into a corner."
The concerns raised
about the LTSF reveal its "lack of focus on rural
areas, on agriculture", she said in an interview.
"It shows that the LTSF is devoid of the reality
that we see in the region."
The bank could
not have done more damage to its relevance in Asia
as a result of this clear shift away from
assisting the agriculture sector, Isangani
Serrano, vice president of the Philippine Rural
Reconstruction Movement, based in Quezon City,
told Inter Press Service. "Poverty from the birth
of the ADB until now is a rural phenomenon. How
the hell are they going to achieve a poverty-free
Asia without dedicating a huge part of their
portfolio to agriculture?"
The bank's
annual lending to the agriculture sector has
averaged 11%. In 2007, the total loans and grants
for development in agriculture and natural
resources amounted to US$510 million, a
substantial drop from the $930 million in loans
and grants committed in 2006, according to the
bank's annual report. The transportation and
communication sectors, by contrast, have been
allocated larger chunks of funds - $4.2 billion in
loans and grants in 2007 and $1.5 billion the year
before.
The bank had previously made a
name for itself by backing development initiatives
in the rural sector. In one such initiative that
it backed in the mid-1990s in the Philippines,
where the ADB is based, it approved a substantial
loan for an agrarian reform development program.
The funds were to help improve productivity in the
rural agriculture sector.
The spirit of
such assistance influenced the bank's vision for
its first LTSF, produced around the turn of the
century. That LTSF lent support to the targets set
by the Millennium Development Goals (MDGs), a set
of time-bound targets to slash, among other
things, the rate of global poverty. The world's
leaders approved the 2015 deadline for the MDGs at
a UN summit in New York in 2000. But, the
ADB's attempt to redefine its role in Asia through
the second LTSF has other interests at heart, as
the 34-page document that was distributed on
Sunday revealed. No wonder such a shift has laid
the ADB open to questions.
"There is
reason to be deeply concerned about what is
happening in the agriculture sector in Asia,"
Rajendra Pachauri, who as its head accepted the
2002 Nobel Peace Prize on behalf of the
Intergovernmental Panel on Climate Change, said
during his comments at Sunday's seminar for
central bank governors. "I don't think Asia will
be able to mount the impending crisis unless we
bring about change in agriculture."
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