Updated: Mar 24, 2021
An event to discuss the importance of food and agricultural trade for ending global hunger, to identify critical trade-offs associated with different policy measures and possible priorities for action was held on 7 December. QU Dongyu, director-general at FAO, said in his keynote remarks we are only nine seasons away from 2030, alluding to Sustainable Development Goal 2 of ending hunger by 2030, at the event by the FAO Committee on Commodity Problems (CCP). "Trade is a powerful tool and there are ways to put that power to use which include avoiding raising trade barriers especially in periods of crisis, formulating coherent and aligned policies to address trade-offs and harnessing the power of digital solutions and innovation. Innovation can solve contradictions that affect the dynamics of any single commodity. Coherent, complementary production systems are the key to agri-food system transformation," said Dongyu. The CCP, FAO's oldest technical committee established in 1949, tracks agricultural commodity markets and related policy issues. It consists of 110 members of the FAO along with observers, tasked with reviewing commodity problems of an international character affecting production, trade, distribution and consumption and suggesting policy options. Professor Jeffrey Sachs, director of the Center for Sustainable Development at Columbia University, said in his speech, trade is vital and complicated as we need responsible trade and sustainable trade. He said we have lacked that concept adequately in the past and will need it in the future. “Today, emerging digital technologies including tools such as the Hand-in-Hand Geospatial Platform can provide ways for trading rules and agri-food systems to address holistically the complex dimensions linked to environmental and social sustainability. Such issues should move to the top of the international agenda as they represent significant choices the world's smallholder farmers will need to make in the next 10 to 20 years,” said Sachs.
The discussion was facilitated by a new FAO report titled Trade and Sustainable Development Goal 2 - Policy options and their trade-offs that assess pathways to achieve the five targets set out by SDG 2. SDG2 aims to end hunger, all forms of malnutrition, double agricultural productivity and incomes of small-scale food producers, ensure sustainable food production systems and maintain genetic diversity. The report states that trade is often a policy priority area for FAO members and is a means of implementation for achieving the SDGs. While SDG 2 commits countries to correct and prevent trade restrictions and distortions in world agricultural markets, harnessing international trade to achieve the SDG agenda, it requires addressing the trade-offs between economic, social and environmental outcomes. Government interventions may be required to address market failures, for example to protect biodiversity, minimize damage to the climate or achieve certain social outcomes, according to the report. Boubaker Ben-Belhassen, secretary of the CCP and director of markets and trade division of FAO, said to ensure progress towards SDG2, governments will need to go beyond a narrow focus on the elimination of agricultural export subsidies. “Governments will need to take a broader approach to indicators of progress that encompass the measures that affect trade and markets in the global food system. The value of global agricultural trade has increased enormously in the past two decades, and its structure and patterns have evolved and will continue to do so,” he says. Significantly, emerging economies account for an increasing share of global exports, while South-South ties have deepened with more than half of all the agricultural imports of middle- and low-income countries now sourced from within this group. National measures restricting food exports to protect domestic food security have often led to adverse outcomes. Adverse outcomes include favouring urban non-poor households and food processing businesses at the expense of farmers, many of whom are poor, as well as creating uncertainty in world markets. At the same time, the report notes subsidy schemes may have effects beyond trade and impact the environment or climate trends, considerations that could enrich multilateral negotiations. Maximo Torero, chief economist at the FAO, says we should not be afraid of global value chains, on the contrary, we must make them inclusive for smallholders so that trade can contribute to the struggle against inequality as well as poverty and hunger. He says what is critical is to achieve policy coherence and the alignment of incentives to incorporate trade-offs and the true cost of trade. FAO and its partners are working in nine pilot countries in Africa, Asia and Central America to bring international, national and local partners together to construct and implement capacity development plans for agricultural innovation. It harnesses the power of digital technologies to pilot, accelerate and scale innovative ideas with high potential for impact in food and agriculture, transforming digital solutions and services into global public goods.