A/HRC/9/23
page 22
(b)
Encouraging social safety nets by establishing a global reinsurance fund
44. While necessary, acting on prices alone is not sufficient. In addition, in order to boost
supply, agricultural producers need to be supported through public programmes improving their
ability to produce, and countries need to be able to protect their population from the impact of
the increased volatility of food prices. Indeed, the FAO Right to Food Guidelines recommend
that States establish and maintain social and food-safety nets to protect those who are unable to
provide for themselves. But uncertainty about possible future shocks to their economies is a
major disincentive for poor countries to establish robust social-safety nets, since they know their
fiscal resources may be strained as a result of adverse shocks brutally increasing the needs of the
population. In order to address this problem, the establishment of a global reinsurance fund has
been proposed, providing insurance to poor countries against sudden shocks, whether of internal
or of external origin, leading to rising demands for social support in ways that might not be
fiscally sustainable for the countries concerned.48
(c)
The role of international trade
45. There have been calls for further progress on trade liberalization - and, more precisely, on
the swift completion of the Doha round of negotiations within the World Trade Organization as
part of the answers to the crisis. However, not any agreement will do. As noted in the
Comprehensive Framework for Action, the international trade system needs to be equitable if it
is to contribute to the objective of food security. There are strong arguments for the view that
precipitate and inequitable trade liberalization in agriculture, following the prescriptions of the
international financial institutions in the 1980s, is among the reasons for the lack of development
of the agricultural sector in certain developing countries, particularly in sub-Saharan Africa: in
addition to being heavily taxed by Governments through a combination of exchange rate
manipulation, parastatal monopolies in processing and trading and government price setting,
local farmers were weakened by severely distorted competition from abroad. The Uruguay round
of trade negotiations leading to the establishment of the World Trade Organization and the
conclusion of the agreement on agriculture did little to remedy this, and it is still uncertain
whether the round of negotiations launched in Doha in November 2001 will offer satisfactory
answers, as called for by the United Nations Conference on Trade and Development São Paulo
Consensus.49 Indeed, given that larger agricultural producers are in general better positioned to
benefit from the opportunities created by trade liberalization, since they can more easily adapt to
the volumes and standards requirements imposed by global food buyers and retailers, there is a
real risk that export-led agricultural development will further marginalize the position of
smallholders, worsening their food insecurity instead of improving it.
48
Sanjay G. Reddy, ‘Safety Nets for the Poor: A Missing International Dimension?’ in
Giovanni Andrea Cornia (ed), Pro-Poor Macroeconomics, Palgrave Macmillan, 2006, 144-165,
here at 160.
49
TD/410, 25 June 2004, para. 75.
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