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Farming to help food prices
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Fri, 16 May 2008 14:32
The IMF's Africa chief said on Friday the shock of rocketing food
prices should focus attention on improving farming on the world's
poorest continent.
There is no reason for Africa to be a food importer, but governments
and donors have neglected the continent's agriculture sector, said
Benedicte Vibe Christensen, acting director for Africa of the
International Monetary Fund.
She recommended a broad-based approach. In addition to steps to help
farmers boost production, rural infrastructure needs improvement, and
banks and lenders need to extend more services outside the cities, she
told reporters.
Christensen was in South Africa to present the IMF's regional
economic outlook. It predicts growth at about 6.5 percent this year,
mostly fuelled by oil exporting countries like Nigeria and Angola.
"There's no need for Africa to be a food importer," Christensen
said. She called for better policies and assistance, such as fertilizer
subsidies, to
boost farming output. But she also said a broad approach
was needed to improve infrastructure generally outside the cities and
to ensure that banking and lending facilities were extended to the
countryside. The result would be not only better food production, but
also an extension of the anti-poverty campaign beyond urban centres.
"If you look at 20 years of development, it hasn't really taken
hold," she said. Improving the agriculture sector "requires investors,
it requires policies."
The food crisis has been felt around the world but particularly in
Africa, where most countries import food. African consumers have
protested and even rioted against high prices.
"We understand the governments need to take measures, but we urge
them to be targeted," Christensen said. She urged against general good
subsidies, saying that usually this helps the better off and is
expensive.
She also said price controls tend to hurt domestic farmers while
export
controls — some poor countries have banned exporting rice and
other food — "is aggravating significantly the problem of world
supply."
The IMF forecasts inflation of 8.5 percent, and believes inflation
could be higher given the rising oil and food prices. The fund is also
saying that given the food and oil prices, and given the global
slowdown in the economy and global turbulence in financial markets,
there is a slight chance that African growth will be less than 5
percent.