International trade helps solve food crisis: WTO

Original Publication Date: 
11 May, 2009

GENEVA (Reuters) - International trade is part of the solution to the global food crisis and not one of its causes, the head of the World Trade Organization said on Sunday.

Global integration represented by trade enabled food to be transported from where it could be produced efficiently to where there was demand, said WTO Director-General Pascal Lamy.

Geography meant many countries -- Egypt, for example -- could never be self-sufficient in food, he said in a speech prepared for an International Food and Agricultural Trade Policy Council conference in Salzburg, Austria.

"International trade was not the source of last year's food crisis," Lamy said.

"If anything, international trade has reduced the price of food over the years through greater competition, and enhanced consumer purchasing power."

Sharp rises in food prices in 2007 and 2008 led to riots in many countries over food shortages.

Prices have since come off their peaks but many experts argued agricultural trade exacerbated the problem and was not in the interest of poor farmers or consumers in poor countries.

Lamy said Olivier De Schutter, the United Nations special rapporteur on the right to food, had condemned an excessive reliance on trade in the pursuit of food security, while some farmers' groups had also called for greater self-sufficiency.

Trade could not be behind the volatility in food prices, as agriculture accounts for less than 10 percent of world trade, while only 25 percent of world farm output is traded globally, compared with 50 percent of industrial goods, Lamy said.

"To suggest that less trade, and greater self-sufficiency, are the solutions to food security, would be to argue that trade was itself to blame for the crisis," he said.

Lamy said the sensitive nature of food meant agriculture received special treatment in international trade rules compared with industrial goods such as shirts or tires.

Developing countries were becoming more competitive in farm trade, with agricultural exports from developing to developed countries rising 11 percent a year between 2000 and 2007, faster than the 9 percent growth in trade in the other direction.

Although millions continue to suffer from hunger, the share of personal incomes spent on food in the poorest countries was declining, Lamy said.

(Reporting by Jonathan Lynn; Editing by Sophie Hares)