Tackling Asean’s food crises

POLICYMAKERS from 10 major Southeast Asian economies gather in Phnom Penh this week for the summit of Asean nations amid growing global concerns about the impact of soaring food prices and intense supply shortages.

Russia’s initial suspension of the Black Sea agreement that allowed Ukrainian grain exports at end-October sent cereal prices surging, worsening an already woeful situation in the region. In Laos, inflation spiked to a high of almost 37 per cent in October, with steep increases in the prices of rice and other food items such as pork, poultry, fish, seafood and eggs. In the Philippines, food prices rose by 9.4 per cent in October, pushing headline inflation to 7.7 per cent in October, the highest recorded inflation since December 2008.

Given that food typically accounts for between one third and one half of household spending in Asean countries, faster food price rises quickly lead to financial and food insecurity. Spikes in the cost of food production can quickly turn into broadbased inflation and create a cost-of-living crisis. This in turn affects the health of the region’s agri-food industry, upon which many livelihoods depend.