COVID-19: FAO breaks down the food supply economics

Breaking down the food supply economics amid Covid-19 – A scenario mapping by FAO

A battle plan for ensuring global food supplies during the COVID-19 crisis is in motion, says the Food and Agriculture Organisation Chief Economist Maximo Torero Cullen.

Governments will require to set unprecedented actions to restrict movements. Included also is adapting radical deployment of public funds to combat the threat posed by a novel coronavirus that knows no boundaries.

“As more countries adopt lockdown policies to contain and mitigate the COVID-19 crisis, is there a risk that we will run out of food?” posits Torero Cullen.

The risks are probable but there were plenty of ways to reduce its likelihood, and the sooner we adopt them the more the world could avoid exacerbating the global health crisis.

Here are the proposed steps by FAO:

Government of the people. Government can during the emergency make a point of purchasing agricultural products from small farmers to establish strategic emergency reserves for humanitarian purposes.

Coordinated policy responses encompass all steps – Food banks and efforts by charities and non-governmental organizations can also be mobilized to deliver food.

Global food trade has to be kept going – Countries should immediately review their trade and taxation policy options – and their likely impacts – and work in concert with one another to create a favourable environment for food trade.

Domestic markets – Farmers won’t grow what nobody can buy, so the issue is about affordability but also availability and accessibility. Ensuring the safety of food-system workers is paramount, so on-site health measures, empowering sick-leave policies, physical distancing instructions and capabilities need to be assured, and the same applies to the delivery sector. E-commerce platforms have huge potential here as China has demonstrated.

Labour market – More than a fourth of the world’s farm work is done by migrant workers, so to avoid labour shortages visa protocols should be expedited, regardless of how counterintuitive that may seem right now.

Smallholder farmers – Temporary cash handouts for poor farmers are essential, as well as grants to restart production. Banks can waive fees on farmers’ loans and extend payment deadlines; capital can be injected into the agriculture sector to help small and medium-sized agribusinesses – and their work force – stay afloat.

The Citizens – Lockdown measures translate into layoffs and reduced income, making it more of a struggle for families to put food on the table. These households need cash more than anything else. One-off payments, as used for example by Hong Kong and Singapore, or multiple cash transfers, using existing programmes such as the SNAP programme in the United States or China’s move to accelerate payments of unemployment insurance, are appropriate.

Open global food trade helps keep downstream food markets functioning. Actually, it would help stabilize world food markets if harmful import tariffs, non-tariff trade barriers and value-added taxes were temporarily reduced.