IATP's Alexandra Spieldoch and Anne Laure Constantin are in Accra, Ghana for the United Nations Conference on Trade and Development (UNCTAD) XII meeting through April 24. They will be blogging periodically on events in Accra.
Skyrocketing food prices feature high on UNCTAD XII’s agenda. WTO Director General Pascal Lamy addressed this topic to civil society representatives here on April 21. His take on the current food crisis and the role of the WTO was a disappointment to many. According to Lamy, the change in eating habits in developing countries is the main, long-standing factor leading to the increase in prices.
The day before, U.N Secretary General Ban Ki Moon had highlighted more comprehensively the mix of factors leading to price increases, including rising oil prices, climate-related production shortfalls, global economic growth, financial speculation, the shift to biofuels production and the depreciation of the U.S. dollar. For more details on some of these factors, see our recent paper on global agriculture prices and development.
M. Lamy’s argument missed the point. Take just one of the factors M. Ban mentioned: speculation. More and more money is going into financial investment in agriculture commodities. The UN Food and Agriculture Organisation (FAO) concluded that this has been made possible by the deregulation of international agriculture markets. As a result, the volatility of commodity prices is growing. Yesterday, in a debate on “the changing face of commodities in the 21st century,” a Tunisian representative estimated that speculation was responsible for a third of the price of food at the moment.
But no question: M. Lamy was not prepared to engage in a serious reconsideration of global trade deregulation. Hence the “disillusion” expressed by an African civil society leader towards the end of the meeting.
