Brussels, 24/06/2011 (Agence Europe) - Increasing food production, creating a database of the production and stocks of agricultural raw materials, putting in place a rapid reaction mechanism in the event of a crisis and the removal of export restrictions for global food aid and financial regulation. G20 agriculture ministers, meeting in Paris on 22 and 23 June, approved a rather innovative and ambitious action plan on food price volatility and agriculture. This plan will be put to the heads of state or government of the industrialised and emerging countries that form this group at their meeting in Cannes at the start of November. NGOs were somewhat disappointed.
“With this agreement, we are laying the foundations of new global agriculture. Sustainable agriculture, where there will be solidarity and where the markets will be regulated”, said French minister Bruno Le Maire, who chaired the meeting. Negotiations took account of the need to “end the scandal of hunger in the world”, he added. The plan contains “concrete, detailed and ambitious” decisions, Le Maire said. He cited: - the need to increase world food production (sequencing of the wheat genome); - improving the transparency of agricultural markets (to ease price volatility); - improving the coordination of response among G20 members (“we decided no longer to accept unilateral decisions when a producer country is faced with drought, flooding or specific problems”, Le Maire stated); in this context, coordination mechanisms will be set up to allow joint decision-making on how best to respond in the event of a fall in production in any of the countries, - protection for developing countries which are most severely hit by agricultural price volatility); - financial regulation. “We all agree that agricultural markets have to be regulated, that new operating rules have to be put in place in agricultural raw materials markets, and that market abuse and cross-market manipulation have to be tackled in the context of agricultural financial markets”, Le Maire said.
The main thrust of the action plan on price volatility is as follows:
Production. It is planned to: - implement a broad range of initiatives to boost agricultural growth; - strengthen agricultural research and innovation (with, as a first stage, an International Research Initiative for Wheat Improvement - IRIWI); - increase public and private investment in agriculture.
Market information and transparency. The G20 decided to launch the Agricultural Market Information System (AMIS), to be housed at the FAO. AMIS, Le Maire explained, will be an international database of the “production, consumption and stocks of agricultural raw materials”. The aim is to encourage the main players in the agri-food markets to share information, improve existing information systems, promote better shared understanding of food price developments and promote political dialogue and cooperation. This database will be brought on-stream “as quickly as possible” and will be complemented by a satellite monitoring system which will mean that satellite images on agricultural production can be pooled and account taken of the impact of climate change on global agricultural production.
International policy coordination. The action plan advocates that, building on the AMIS initiative, a “Rapid Response Forum” be put in place within the FAO. The Rapid Response Forum, Le Maire said, will comprise high level representatives from the G20, will mean that decisions can be taken as quickly as possible in the event of a fall in production in one of the major producer states and allow countries to consult one another and respond collectively “in circumstances where we have got into the bad habit of responding individually”. In the event of a crisis, all decisions will be taken by the Rapid Response Forum.
Reducing the effects of price volatility on the most vulnerable. “We have pledged to end all restrictions on exports for world food aid. This is a completely new commitment, complementing arrangements already in place on imports”, Le Maire said. Ministers say they have reached agreement on the objective, principles, arrangements and timetable of an agricultural and food security risk management toolbox. They back the development of a proposal for a targeted emergency humanitarian food reserves system to complement existing regional and national food reserves.
Financial regulation. G20 finance ministers and governors of central banks are “strongly encouraged” to take the appropriate decisions for a “better regulation and supervision of agricultural financial markets”. Among the concrete proposals made by G20 agriculture ministers is setting ex-ante position limits.
The think tank momagri notes “with interest” the conclusions of the G20 agriculture meeting which, for the first time, sets international cooperation principles which seek to address price volatility and its consequences. It only remains to be hoped that this approach will be backed by the political will needed to bring about genuine global governance of agriculture and food, it adds. (L.C./transl.rt)