Skyrocketing Inflation Puts Food Security in Pakistan at Risk

Posted on September 26, 2023 by admin

Asia-Pacific, Civil Society, Food Security and Nutrition, Headlines, Humanitarian Emergencies, Poverty & SDGs, TerraViva United Nations, Trade & Investment

Economy & Trade

Jamaat-i-Islami party stage protest in Peshawar against price-hikes. Credit: Ashfaq Yusufzai/IPS

PESHAWAR, PAKISTAN, Sep 26 2023 (IPS) – “We are under extreme stress about skyrocketing prices of essential edible commodities and the cost of gas and electricity. The situation is becoming worse because every day. We must pay more for wheat flour, sugar, tea, milk, oil, etc.,” Azizullah Khan, a civil servant, says.

Khan draws a monthly salary of 30,000 rupees (USD100), but the cost of living is increasing daily, making it hard for his family of eight to survive.

The electricity bill for August was 20,000 rupees (USD67), and two-thirds of his salary went into paying that, while the remaining 10,000 rupees (USD33) is meant to pay for gas and other family expenses, which, he says, is next to impossible.

“Now, we are seriously thinking of selling the small house we inherited from our parents because we have to repay loans to the shopkeepers and pay the school fees of three children,” says Khan, 30. He lives on the outskirts of Peshawar, the provincial capital of Khyber Pakhtunkhwa, one of Pakistan’s four provinces.

Pakistan’s leading economy and business analyst, Khurram Hussain, told IPS that the country has been seeing relentless and unending pressure on the exchange rate and price levels for more than two and a half years.

“The present bout of exchange rate volatility began in May 2021 and has continued unabated since then,” Hussain says. The dollar had from around 150 rupees to the dollar to about 300 to the dollar, he says.

Quoted in Dawn, a newspaper in Pakistan, he noted: “It took ten years for the dollar to double in value from 75 to 150 rupees, from 2008 till 2019. It took less than two and a half years to double again from May 2021 till today.

At the same time, inflation, as measured by the Consumer Price Index, started to skyrocket a few months after May 2021 and has risen relentlessly until now, with a few interruptions.

Muhammad Raees, 28, a daily wager, is severely hit by the cost of living.

“One year back, the price of 20 kg wheat four was Rs1300, which has now increased to Rs3000. I don’t find work every day because the construction activities have nosedived due to cement, iron, marble, and tile prices, and most of the contractors have stopped work,” Raees, a father of two, says.

“Many times, I have thought of committing suicide, but then I think of my children and wife,” he says.

At least ten people have committed suicide in the past two months.

“They were unable to pay electricity bills. Now, the government is mulling about jacking up the gas price by 50 percent. The poor population is the worst hit,” he says.

Javid Shah, a vegetable seller in Nowshera city adjacent to Peshawar, is fed up with life. “Cost of transportation has increased, and so the prices of vegetables and, as a result, sales have declined. Many who bought 1 kg of tomatoes, lady fingers, and potatoes daily are now taking half a kg,” he says. “I have to discard rotten vegetables daily for lack of sales.”

Akram Ali, a fruit seller in a tiny shop, also constantly complains of high inflation and devaluation of rupees. Ali says his business has reached a standstill as people no longer buy fruits due to high prices.

“As a result, I am going to close shop and start the business in a hand pushcart to save on rent.”

“My two sons are going to school, but the last one and half years have been tough, and I cannot pay their fees. Both have quit schools and sit at home,” he complained.

Saleem Ahmed, a local economist, tells IPS that pulses, considered poor men’s diet, are so expensive they are out of reach of many.

“All pulses are imported in dollars, so their prices have increased. The people are struck by inflation, and they cannot buy items, like pulses, which used to be cheap,” he said.

Prices were stable until former Prime Minister Imran Khan was removed in April 2022 in a no-confidence vote at the National Assembly.

“People have been running from pillar to post for two square meals. As if inflation wasn’t enough, huge smuggling of sugar, wheat flour, pulses, oil, etc. to neighboring Afghanistan have hammered the last nail in the coffin of the poverty-stricken masses,” he said.

Ahmed says the government is taking loans from the IMF, the World Bank, and other lenders with high interest rates, impacting the cost of living.

In such a scenario, Afghan refugees living in Pakistan are jubilant over the rising Afghan economy under the Taliban, and many are weighing options to return to their country.

“In Pakistan, the US dollar is equal to 300 rupees while it is traded for 75 Afghani back home,” Muhammad Mustafa, an Afghan with a sanitary business in Peshawar, says.

Mustafa says he had sent his elder son to Kabul to search for the rented shop so he could shift his business there.

“All my family live in Kabul, and we want to be there. The time is ripe for us to shift (back) there,” he says.

Petrol is being sold at 312 rupees (USD1.5) per liter in Pakistan, while its rate was 80 Afghani (USD1.02) in Kabul.

IPS – UN Bureau, IPS UN Bureau Report,

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UN Must Reclaim Multilateral Governance from Pretenders

Posted on August 24, 2023 by admin

Civil Society, Development & Aid, Economy & Trade, Global, Headlines, IPS UN: Inside the Glasshouse, TerraViva United Nations, Trade & Investment

Opinion

KUALA LUMPUR, Malaysia, Aug 24 2023 (IPS) – International governance arrangements are in trouble. Condemned as ‘dysfunctional’ by some, multilateral agreements have been discarded or ignored by the powerful except when useful to protect their interests or provide legitimacy.

Economic multilateralism under siege
Undoubtedly, many multilateral arrangements have become less appropriate. At their heart is the United Nations (UN) system, conceived in the last year of US President Franklin Delano Roosevelt’s presidency and World War Two.

Jomo Kwame Sundaram

The 1944 UN conference at Bretton Woods sought to build the foundations for the post-war economic order. The International Monetary Fund (IMF) would create conditions for lasting growth and stability, with the World Bank financing post-war reconstruction and post-colonial development.

The Bretton Woods agreement allowed the US Federal Reserve Bank (Fed) to issue dollars, as if backed by gold. In 1971, President Richard Nixon repudiated the US’s Bretton Woods obligations. With US military and ‘soft’ power, widespread acceptance of the dollar since has effectively extended the Fed’s ‘exorbitant privilege’.

This unilateral repudiation of US commitments has been a precursor of the fate of some other multilateral arrangements. Most were US-designed, some in consultation with allies. Most key privileges of the global North – especially the US – continue, while duties and obligations are ignored if deemed inconvenient.

The International Trade Organization (ITO) was to be the third leg of the post-war multilateral economic order, later reaffirmed by the 1948 Havana Charter. Despite post-war world hegemony, the ITO was rejected by the protectionist US Congress.

The General Agreement on Tariffs and Trade (GATT) became the compromise substitute. Recognizing the diversity of national economic capacities and capabilities, GATT did not impose a ‘one-size-fits-all’ requirement on all participants.

But lessons from such successful flexible precedents were ignored in creating the World Trade Organization (WTO) from 1995. The WTO has imposed onerous new obligations such as the all-or-nothing ‘single commitment’ requirement and the Agreement on Trade-related Intellectual Property Rights (TRIPS).

Overcoming marginalization
In September 2021, the UN Secretary-General (SG) issued Our Common Agenda, with new international governance proposals. Besides its new status quo bias, the proposals fall short of what is needed in terms of both scope and ambition.

Problematically, it legitimizes and seeks to consolidate already diffuse institutional responsibilities, further weakening UN inter-governmental leadership. This would legitimize international governance infiltration by multi-stakeholder partnerships run by private business interests.

The last six decades have seen often glacially slow changes to improve UN-led gradual – mainly due to the recalcitrance of the privileged and powerful. These have changed Member State and civil society participation, with mixed effects.

Fairer institutions and arrangements – agreed to after inclusive inter-governmental negotiations – have been replaced by multi-stakeholder processes. These are typically not accountable to Member States, let alone their publics.

Such biases and other problems of ostensibly multilateral processes and practices have eroded public trust and confidence in multilateralism, especially the UN system.

Multi-stakeholder processes – involving transnational corporate interests – may expedite decision-making, even implementation. But the most authoritative study so far found little evidence of net improvements, especially for the already marginalized.

New multi-stakeholder governance – without meaningful prior approval by relevant inter-governmental bodies – undoubtedly strengthens executive authority and autonomy. But such initiatives have also undermined legitimacy and public trust, with few net gains.

All too often, new multi-stakeholder arrangements with private parties have been made without Member State approval, even if retrospectively due to exigencies.
Unsurprisingly, many in developing countries have become alienated from and suspicious of those acting in the name of multilateral institutions and processes.

Hence, many in the global South have been disinclined to cooperate with the SG’s efforts to resuscitate, reinvent and repurpose undoubtedly defunct inter-governmental institutions and processes.

Way forward?
But the SG report has also made some important proposals deserving careful consideration. It is correct in recognizing the long overdue need to reform existing governance arrangements to adapt the multilateral system to current and future needs and requirements.

This reform opportunity is now at risk due to the lack of Member State support, participation and legitimacy. Inclusive consultative processes – involving state and non-state actors – must strive for broadly acceptable pragmatic solutions. These should be adopted and implemented via inter-governmental processes.

Undoubtedly, multilateralism and the UN system have experienced growing marginalization after the first Cold War ended. The UN has been slowly, but surely superseded by NATO and the Organization for Economic Cooperation and Development (OECD), led by the G7 group of the biggest rich economies.

The UN’s second SG, Dag Hammarskjold – who had worked for the OECD’s predecessor – warned the international community, especially developing countries, of the dangers posed by the rich nations’ club. This became evident when the rich blocked and pre-empted the UN from leading on international tax cooperation.

Seeking quick fixes, ‘clever’ advisers or consultants may have persuaded the SG to embrace corporate-dominated multi-stakeholder partnerships contravening UN norms. More recent SG initiatives may suggest his frustration with the failure of that approach.

After the problematic and controversial record of such processes and events in recent years, the SG can still rise to contemporary challenges and strengthen multilateralism by changing course. By restoring the effectiveness and legitimacy of multilateralism, the UN will not only be fit, but also essential for humanity’s future.

IPS UN Bureau

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Employee-run Companies, Part of the Landscape of an Argentina in Crisis

Posted on May 24, 2022 by admin

Active Citizens, Civil Society, Cooperatives, Economy & Trade, Editors’ Choice, Featured, Headlines, Labour, Latin America & the Caribbean, Regional Categories, TerraViva United Nations, Trade & Investment

Labour

A group of Farmacoop workers stand in the courtyard of their plant in Buenos Aires. Members of the Argentine cooperative proudly say that theirs is the first laboratory in the world to be recovered by its workers. CREDIT: Courtesy of Pedro Pérez/Tiempo Argentino.

BUENOS AIRES, May 24 2022 (IPS) – “All we ever wanted was to keep working. And although we have not gotten to where we would like to be, we know that we can,” says Edith Pereira, a short energetic woman, as she walks through the corridors of Farmacoop, in the south of the Argentine capital. She proudly says it is “the first pharmaceutical laboratory in the world recovered by its workers.”

Pereira began to work in what used to be the Roux Ocefa laboratory in Buenos Aires in 1983. At its height it had more than 400 employees working two nine-hour shifts, as she recalls in a conversation with IPS.

But in 2016 the laboratory fell into a crisis that first manifested itself in delays in the payment of wages and a short time later led to the owners removing the machinery, and emptying and abandoning the company.

The workers faced up to the disaster with a struggle that included taking over the plant for several months and culminated in 2019 with the creation of Farmacoop, a cooperative of more than 100 members, which today is getting the laboratory back on its feet.

In fact, during the worst period of the pandemic, Farmacoop developed rapid antigen tests to detect COVID-19, in partnership with scientists from the government’s National Council for Scientific and Technical Research (Conicet), the leading organization in the sector.

Farmacoop is part of a powerful movement in Argentina, as recognized by the government, which earlier this month launched the first National Registry of Recovered Companies (ReNacER), with the aim of gaining detailed knowledge of a sector that, according to official estimates, comprises more than 400 companies and some 18,000 jobs.

The presentation of the new Registry took place at an oil cooperative that processes soybeans and sunflower seeds on the outskirts of Buenos Aires, built on what was left of a company that filed for bankruptcy in 2016 and laid off its 126 workers without severance pay.

Edith Pereira (seated) and Blácida Benitez, two of the members of Farmacoop, a laboratory recovered by its workers in Buenos Aires, are seen here in the production area. This is the former Roux Ocefa laboratory, which went bankrupt in the capital of Argentina and was left owing a large amount of back wages to its workers. CREDIT: Daniel Gutman/IPS

The event was led by President Alberto Fernández, who said that he intends to “convince Argentina that the popular economy exists, that it is here to stay, that it is valuable and that it must be given the tools to continue growing.”

Fernández said on that occasion that the movement of worker-recuperated companies was born in the country in 2001, as a result of the brutal economic and social crisis that toppled the presidency of Fernando de la Rúa.

“One out of four Argentines was out of work, poverty had reached 60 percent and one of the difficulties was that companies were collapsing, the owners disappeared and the people working in those companies wanted to continue producing,” he said.

“That’s when the cooperatives began to emerge, so that those who were becoming unemployed could get together and continue working, sometimes in the companies abandoned by their owners, sometimes on the street,” the president added.

Two technicians package products at the Farmacoop laboratory, a cooperative with which some of the workers of the former bankrupt company undertook its recovery through self-management, a formula that is growing in Argentina in the face of company closures during successive economic crises. CREDIT: Courtesy of Farmacoop

A complex social reality

More than 20 years later, this South American country of 45 million people finds itself once again in a social situation as severe or even more so than back then.

The new century began with a decade of growth, but today Argentines have experienced more than 10 years of economic stagnation, which has left its mark.

Poverty, according to official data, stands at 37 percent of the population, in a context of 60 percent annual inflation, which is steadily undermining people’s incomes and hitting the most vulnerable especially hard.

The latest statistics from the Ministry of Labor, Employment and Social Security indicate that 12.43 million people are formally employed, which in real terms – due to the increase of the population – is less than the 12.37 million jobs that were formally registered in January 2018.

“I would say that in Argentina we have been seeing the destruction of employment and industry for 40 years, regardless of the orientation of the governments. That is why we understand that worker-recovered companies, as a mechanism for defending jobs, will continue to exist,” says Bruno Di Mauro, the president of the Farmacoop cooperative.

“It is a form of resistance in the face of the condemnation of exclusion from the labor system that we workers suffer,” he adds to IPS.

“He who abandons gets no prize” reads the banner with which part of the members of the Farmacoop cooperative were demonstrating in the Plaza de Mayo in downtown Buenos Aires, during the long labor dispute with the former owners who drove the pharmaceutical company into bankruptcy. The workers managed to recover it in 2019. CREDIT: Courtesy of Bruno Di Mauro/Farmacoop.

Today Farmacoop has three active production lines, including Aqualane brand moisturizing cream, used for decades by Argentines for sunburn. The cooperative is currently in the cumbersome process of seeking authorizations from the health authority for other products.

“When I look back, I think that we decided to form the cooperative and recover the company without really understanding what we were getting into. It was a very difficult process, in which we had colleagues who fell into depression, who saw pre-existing illnesses worsen and who died,” Di Mauro says.

“But we learned that we workers can take charge of any company, no matter how difficult the challenge. We are not incapable just because we are part of the working class,” he adds.

Farmacoop’s workers currently receive a “social wage” paid by the State, which also provided subsidies for the purchase of machinery.

The plant, now under self-management, is a gigantic old 8,000-square-meter building with meeting rooms, laboratories and warehouse areas where about 40 people work today, but which was the workplace of several hundred workers in its heyday.

It is located between the neighborhoods of Villa Lugano and Mataderos, in an area of factories and low-income housing mixed with old housing projects, where the rigors of the successive economic crises can be felt on almost every street, with waste pickers trying to eke out a living.

Edith Pereira shows the Aqualane brand moisturizing cream, well known in Argentina, that today is produced by the workers of the Farmacoop cooperative, which has two industrial plants in Buenos Aires, recovered and managed by the workers. CREDIT: Daniel Gutman/IPS

“When we entered the plant in 2019, everything was destroyed. There were only cardboard and paper that we sold to earn our first pesos,” says Blácida Martínez.

She used to work in the reception and security section of the company and has found a spot in the cooperative for her 24-year-old son, who is about to graduate as a laboratory technician and works in product quality control.

A new law is needed

Silvia Ayala is the president of the Mielcitas Argentinas cooperative, which brings together 88 workers, mostly women, who run a candy and sweets factory on the outskirts of Buenos Aires, where they lost their jobs in mid-2019.

“Today we are grateful that thanks to the cooperative we can put food on our families’ tables,” she says. “There was no other option but to resist, because reinserting ourselves in the labor market is very difficult. Every time a job is offered in Argentina, you see lines of hundreds of people.”

Ayala is also one of the leaders of the National Movement of Recovered Companies, active throughout the country, which is promoting a bill in Congress to regulate employee-run companies, presented in April by the governing Frente de Todos.

“A law would be very important, because when owners abandon their companies we need the recovery to be fast, and we need the collaboration of the State; this is a reality that is here to stay,” says Ayala.

Argentine President Alberto Fernández stands with workers of the Cooperativa Aceitera La Matanza on May 5, when the government presented the Registry of Recovered Companies, which aims to formalize worker-run companies. CREDIT: Casa Rosada

The Ministry of Social Development states that the creation of the Registry is aimed at designing specific public policies and tools to strengthen the production and commercialization of the sector, as well as to formalize workers.

The government defines “recovered” companies as those economic, productive or service units that were originally privately managed and are currently run collectively by their former employees.

Although the presentation was made this month, the Registry began operating in March and has already listed 103 recovered companies, of which 64 belong to the production sector and 35 to the services sector.

The first data provide an indication of the diversity of the companies in terms of size, with the smallest having six workers and the largest 177.

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Indian Agriculture Towards 2030

Posted on April 4, 2022 by admin

Asia-Pacific, Biodiversity, Civil Society, Climate Change, Combating Desertification and Drought, Environment, Food and Agriculture, Food Security and Nutrition, Food Sustainability, Headlines, Natural Resources, TerraViva United Nations, Trade & Investment, Water & Sanitation

Opinion

KATHMANDU, Nepal, Apr 4 2022 (IPS) – India began its journey as an independent nation in 1947 with fresh memory of the Bengal Famine of 1943 which claimed 1.5 to 3 million lives. Against this backdrop, the First Five Year Plan (1951-56) prioritized agriculture which, however, shifted to heavily industrialization in the second Plan.

Shyam Khadka

The mid-1960s was a difficult time when consecutive droughts hit food production and India had to import about 11 million metric ton (MMT) of wheat per year – about 15% of its domestic food grain production – under US Public Law 480. With the availability of high yielding miracle seeds of wheat and rice accompanied by increasing use of chemical fertilisers, provision of minimum support price (MSP) for rice and wheat, expansion in irrigated area, and gradual mechanization of farms, Indian agri-food system fortunately took a definitive positive turn beginning late 1960s. As a result, India has become the largest producer of milk (187.7 MMT in 2019-20) and cotton (37.5 million bales in 2019-20) and the second largest producer of rice (117.5 MMT in 2019-20) and wheat (106.2 MMT in 2019-20), fruits (97.97 MMT in 2018-19) and vegetables (183.17 MMT in 2018-19). India today is not only food self-sufficient but also a net exporter of agricultural produce. In short, the success of Indian agriculture in last six decades has been nothing less than spectacular.

The success, however, has come with significant costs. The resource intensification that the Green Revolution requires has adversely affected natural resources and environment. India pumped 245 million cubic meters – about 25 percent of total groundwater withdrawn globally – for irrigation in 2011. As a result, ground water in 1,034 blocks (16% of total blocks) are over-exploited. Worse, ground water table has become critical in 4% and semi-critical in 10% of the blocks. Similarly, some 37% of land area in the country (120.4 mn ha) is affected by various types of land degradation. Subsidy policy-induced non-judicious use of fertilizers has led to the chemicalization of soil and pollution of water through leaching and run-off. Despite abundant supply of food grains, in 2020 41.7% of under-5 children suffered from stunting. India is home to 208.6 million – or over a quarter – of world’s undernourished people. Other challenges that Indian agriculture faces today include uneven regional growth, rising fiscal constraints, mounting and unsustainable level of subsidies, small holding size and further fragmentation of holdings and accompanying land tenurial issues, and low resource use efficiency, particularly of water. These factors act as serious impediments for sustained agricultural growth and farmers’ livelihoods.

Amidst the success and emerging challenges NITI Aayog, the apex public policy think tank of the Government of India and the Food and Agricultural Organization of the United Nations (FAO) decided to facilitate a national dialogue among key stakeholders including government agencies, academia, civil society organisations, farmers, private sector, international organizations, media and others to articulate a vision for 2030 and pathways for the remandating of agriculture in India. To this end, 10 thematic papers were commissioned from distinguished professionals. A 3-day national dialogue entitled, ‘Indian Agriculture Towards 2030: Pathways for enhancing Farmers’ Income, Nutritional Security and Sustainable Food and Farm Systems” was held in January 2021. NITI Aayog and FAO have now come up with a publication with the same title (Chand, R., Joshi, P, and Khadka, S., Editors (2022), Springer).

In addition to the challenges enumerated above the books also deals with issues of climate change and its impact on agricultural production and farmers’ incomes and the strategies to mitigate such change; growing incidence of pests, pandemics, and transboundary diseases and threat to biosecurity affecting agricultural production; and alternative farming systems for transformative and sustainable agroecology and biodiverse future. The role of science, technology and innovation is identified as key to sustainable and resilient agriculture. Similarly, role of structural reforms and governance are discussed in detail and the role of price policies, market reforms and institutions are being highlighted for an efficient, inclusive and sustainable agriculture.

The National Dialogue identified pathways for transformation with emphasis on remandating Indian agriculture in a way that makes it more productive, efficient, resilient, resource conserving, nutrition centered and globally focused. These transformational outcomes are to be achieved by focusing on following pathways:

As emphasised by Honourable M. Venkaiah Naidu, Vice-President of India in his foreword, the book ‘provides a sound basis for reflection because they distil important lessons and present an array of policy options for the government to choose from’.

Shyam Khadka is a former senior official of the Food and Agriculture Organization of the United Nations who served as representative in India (2015-18) and was Senior Portfolio Manager in United Nations International Fund for Agricultural Development (1997-2014). An international development professional, Khadka works on policies, programs and projects that aim at developing agriculture, ensuring food security, and reducing poverty globally.

IPS UN Bureau

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Donors Must Rethink Africa’s Flagging Green Revolution, New Evaluation Shows (Commentary)

Posted on March 23, 2022 by admin

Africa, Civil Society, Development & Aid, Economy & Trade, Food and Agriculture, Food Security and Nutrition, Food Sustainability, Green Economy, Headlines, TerraViva United Nations, Trade & Investment

Opinion

BOSTON, Mar 23 2022 (IPS) – • A scathing new analysis of the Alliance for a Green Revolution in Africa (AGRA) finds that the program is failing at its objective to increase food security on the continent, despite massive funding from the Bill & Melinda Gates Foundation and the US, UK, and German governments.

• On March 30, critics of AGRA will brief U.S. congressional aides about why they think it is doing more harm than good.

• As fertilizer and food prices spike with rising energy prices from the Russia-Ukraine war, African farmers and governments need the kind of resilient, low-cost alternatives that techniques like agroecology offer, a new opinion piece argues.

A critical new donor-funded evaluation of the Alliance for a Green Revolution in Africa (AGRA) has confirmed what African civil society and faith leaders have claimed: “AGRA did not meet its headline goal of increased incomes and food security for 9 million smallholders.”

The evaluation should be a wake up call, and not just for the private and bilateral donors that have bankrolled this 15-year-old effort to the tune of $1 billion. It should also rouse African governments to repurpose their agricultural subsidies from the Green Revolution package of commercial seeds and fertilizers to agroecology and other low-cost, low-input approaches. They have been providing as much as $1 billion per year for such input subsidies.

Failing Africa’s farmers

Carried out by consulting firm Mathematica, the evaluation confirms that the Green Revolution has failed to achieve AGRA’s stated goal to “catalyze a farming revolution in Africa.”

Wambui Mwihaki, a farmer from central Kenya, takes stock of her thriving maize crop following adoption of agroecology. Credit: David Njagi for Mongabay.

The assessment was funded by AGRA’s primary sponsor, the Bill & Melinda Gates Foundation, on behalf of other lead donors in AGRA’s Partnership for Inclusive Agricultural Transformation in Africa (PIATA): the U.K. Foreign, Commonwealth & Development Office; the Rockefeller Foundation; the U.S. Agency for International Development (USAID); and Germany’s Federal Ministry for Economic Cooperation and Development. The evaluation includes a summary of findings, a statistical appendix, and AGRA’s formal responses to the findings, all available publicly.

Such transparency is welcome. AGRA has been plagued by a lack of accountability since its founding in 2006. I undertook my own assessment of AGRA in 2020 when I could find no comprehensive analysis, from AGRA nor its donors, of its progress toward ambitious goals to double yields and incomes for 30 million small-scale farming families while halving food insecurity by 2020. Using national-level data, I found little evidence of progress, with meager productivity increases, little progress on poverty, and a 31% increase in the number of undernourished people in AGRA’s 13 focus countries.

The new evaluation is far from comprehensive. It covers only AGRA’s last five years of work, ignoring its first 10. It reports on results in just six of AGRA’s current 11 focus countries. Its data on yields is almost exclusively on maize and rice, to the exclusion of the many other staple food crops crucial to Africans’ sustenance. And it fails to incorporate or address the concerns raised publicly by African civil society and faith leaders in public letters to AGRA’s donors.

Agroforestry is a kind of agroecology where crops are grown in combination with trees, like this pumpkin that Eunice Manyi raised among fruit trees in Kenya. Credit: David Njagi for Mongabay.

Still, the findings about poor outcomes for farmers should raise concerns for private and bilateral donors to AGRA’s PIATA strategy and for the African governments that are active partners – and funders – in that effort.

Quoting from the evaluation:

PIATA improved maize yields in Ethiopia, Ghana, and Nigeria, but not in Tanzania, Burkina Faso, or Kenya

Across these six countries, only farmers in Burkina Faso experienced improved maize sales as a result of PIATA

Farmers who adopted improved inputs and experienced yield increases were typically younger, male, and relatively wealthier…. productivity and income gains were also concentrated among these relatively high-resource farmers

AGRA’s next strategy could formally recognize that agricultural technologies and practices—such as fertilizer use and rice cultivation—can negatively impact environmental conditions and greenhouse gas emissions

AGRA surveys are currently not suited for rigorous impact analysis

Time to rethink Green Revolution model

Evaluators gave AGRA credit for some of its work, saying it “was successful in developing key policy reforms, mobilizing flagships and partnerships, and reaching farmers with extension and seeds,” and it helped “incentivize private sector engagement in the production and delivery of improved seeds in some countries.”

But these intermediate objectives, carried out with substantial funding over 15 years, have thus far failed to further the goals of improving farmers’ productivity, incomes, and food security. When one’s development successes fail to produce the intended results, after 15 years and one billion dollars in donor funding, it is time to reconsider the efficacy of the initiative. It is time to rethink the Green Revolution model.

Farmers with seeds in West Africa. Image courtesy of Grassroots International.

AGRA’s management responded to the evaluation saying, “We must therefore rethink our models and focus our support, and that of our partners, on building resilience and adaptation specifically for smallholder farmers.” But there is little sign AGRA intends to pull back from its costly input-intensive Green Revolution model. AGRA president Agnes Kalibata recently defended the status quo in a Q&A with the East African.

Hopefully donors and African governments will take the new evaluation more seriously. African civil society and faith leaders have urged donors to shift their funding to agroecology and other low-cost, low-input systems, which were endorsed last year by the U.N. Committee on World Food Security as a key strategy for climate-resilient development. Such approaches have shown far better results, raising yields across a range of food crops, increasing productivity over time as soil fertility improves, increasing incomes and reducing risk for farmers by cutting input costs, and improving food security and nutrition from a diverse array of crops.

USAID was quick to reject any change in aid priorities. A spokesperson told US Right to Know, “USAID reviewed the findings and recommendations and is satisfied with the independence and rigor of the [Mathematica] evaluation. We appreciate AGRA’s response to the report conclusions and concur with their proposed next steps to improve performance outcomes.”

That will not satisfy African civil society and faith leaders, who were not consulted for the Mathematica evaluation. They plan to take their complaints to the U.S. Congress, which this year has to reauthorize funding for AGRA through its Feed the Future initiative. On March 30, they will brief congressional aides in a closed-door session to explain why the supposed beneficiaries think AGRA is doing more harm than good. As evaluators acknowledge, the main beneficiaries are wealthier male farmers, an outcome at odds with the stated goals of U.S. development policy.

As fertilizer and food prices spike with rising energy prices from the Russia-Ukraine war, African farmers and governments need the kind of resilient, low-cost alternatives agroecology offers. Kenyan farmers report today that the biofertilizers they make themselves from locally available materials cost one-quarter the price of fossil-fuel-based fertilizers.

African governments should recognize that continuing to subsidize increasingly expensive synthetic fertilizer is a losing proposition, especially when that and other Green Revolution inputs are producing such meager results.

It is time for private and bilateral donors – and African governments – to stop throwing good money after bad and recognize that their 15-year effort to “catalyze a farming revolution in Africa” through Green Revolution seeds and fertilizers has fallen short. Fortunately, more promising alternatives are proving their efficacy all over the world. They deserve support.

Timothy A. Wise is a Senior Research Fellow at Tufts University’s Global Development and Environment Institute. A detailed analysis of the recent evaluation of AGRA is available from the Institute for Agriculture and Trade Policy (IATP), where the author is a senior advisor.

IPS UN Bureau

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Fair Tax Plan Could Prejudice Global South

Posted on October 20, 2021 by admin

Civil Society, Development & Aid, Economy & Trade, Featured, Global, Headlines, Inequity, TerraViva United Nations, Trade & Investment

Economy & Trade

Questions are asked whether the Organisation for Economic Co-operation and Development (OECD) agreement to force the world’s biggest companies to pay a fair share of tax will benefit the global South. Credit: Hugo Ramos/Unsplash

BRATISLAVA, Oct 20 2021 (IPS) – An agreement between 136 countries aimed at forcing the world’s biggest companies to pay a fair share of tax has been condemned by critics who say it will benefit richer states at the expense of the global South.

A deal agreed on October 8, and which covers around 90% of the global economy, includes plans for a global minimum corporate tax rate of 15%.

The Organisation for Economic Co-operation and Development (OECD), which led negotiations on the agreement, has said it will help end decades of countries undercutting each other on tax.

But independent organisations campaigning for fairer global taxes and financial transparency argue it will rob developing countries of revenues needed to recover from the COVID-19 pandemic, ultimately pushing millions more people into poverty.

Matti Kohonen of the Financial Transparency Coalition (FTC) civil society group told IPS: “In principle, a global minimum corporate tax is a good idea, but only if the rate is right and implemented properly. Under this deal, the main beneficiaries are the OECD – which led the negotiations – and its largest members.”

Calls for a global minimum corporate tax rate have grown in recent decades amid increasing scrutiny on the tax practices of multinationals.

The OECD deal, which has an aspirational implementation date of 2023, is designed to set a floor on corporate taxation and stop companies shifting profits to countries with the lowest tax rates they can find.

The OECD says the minimum global rate would see countries collect around USD150 billion in new revenues annually, and that taxing rights on more than USD125 billion of profit will be moved to countries where big multinationals earn their income.

But independent groups say the agreement falls far short of what is needed for a fair global corporate taxation system and has ignored the needs and wishes of developing nations, which rely more heavily on corporate tax than richer states.

According to OECD research Corporate Tax Statistics: Third Edition (oecd.org), in 2018, African countries raised 19% of overall revenue from corporate taxation as opposed to 10% among OECD states.

Critics point out that the 15% floor agreed to is well below the average corporate tax rate in industrialised countries of around 23%, potentially creating a ‘race to the bottom’ as countries cut their existing corporate rates.

It is thought a number of developing states had wanted a higher minimum global rate.

Civil society groups critical of the agreement also have concerns over many exemptions in the deal – there is a ten-year grace period for companies on some aspects of the agreement, and some industries such as extractives and financial services, are exempt.

Meanwhile, they highlight, only 100 of the world’s largest companies would be affected by part of the agreement aimed at getting highly profitable multinationals to pay more taxes in countries where they earn profits. Moreover, the minimum global tax will only apply to companies with a turnover of more than 750 million USD, which would exclude 85-90% of the world’s multinationals.

The fact that countries will have to waive digital services taxation rights, which are important sources of revenue for some developing states, is also problematic. And there are concerns that in many cases extra tax paid by corporations ‘topping up’ their tax bill to 15% will go to countries where they are headquartered. In many cases, this will be in already rich nations such as the US, UK, and Europe.

Chenai Mukumba of the Tax Justice Network Africa advocacy group told IPS: “We have an opportunity to reform the global tax system to make it right for global south countries, but we are settling for so much less. This is a lost opportunity to balance the scales, to put fairness at the centre of the system.”

The deal could have a negative effect on African countries, in particular, she pointed out.

Nigeria and Kenya have not signed up for the fair tax deal. Credit: Muhammadtaha Ibrahim Ma’aji/Unsplash

Kenya and Nigeria are among four countries that have not signed up for the deal.

“A lot of African countries currently have corporate tax rates of 25-30%. If the minimum rate is 15%, there is a great incentive for companies to shift profits elsewhere,” Mukumba said.

“Kenya hasn’t signed up to the deal because it is trying to raise revenue from its digital services taxation rights. It may end up buckling to the pressure [to join the deal],” she added.

OECD impact assessment studies for the deal published in 2020 https://www.oecd.org/tax/beps/economic-impact-assessment-webinar-presentation-october-2020.pdf showed that developing nations would gain as much as 4% extra corporate tax revenue.

The organisation told IPS this month (OCT) that it is now expecting those extra revenues to be even higher because of changes to the agreement since last year.

However, studies Pillar 1 impact assessment – 04.10.21 FINAL (oxfamireland.org) by the global aid group Oxfam estimate that 52 developing countries would receive around only 0.025 percent of their collective GDP in additional annual tax revenue under the redistribution of taxing rights.

The group also says a 25% global minimum corporate tax rate would raise nearly USD 17 billion more for the world’s 38 poorest countries – which are home to almost 39% of the global population – as compared to a 15 percent rate.

Speaking just after the agreement between the 136 countries was reached, Oxfam said in a press release that the deal was “a mockery of fairness that robs pandemic-ravaged developing countries of badly needed revenue for hospitals and teachers and better jobs”.

It added: “The world is experiencing the largest increase in poverty in decades and a massive explosion in inequality, but this deal will do little or nothing to halt either.”

Despite the criticism, OECD officials are adamant that the agreement will benefit developing nations.

They point out that it does not affect any state’s national corporate tax rates, and that the 10-year grace period only applies to a very small amount of income – 5% of the carrying value of a firm’s tangible assets and payrolls in a jurisdiction.

Grace Perez Navarro, Deputy Director of the OECD’s Centre for Tax Policy and Administration, told IPS: “The global minimum tax is aimed at stopping tax competition that is causing a race to the bottom in corporate tax rates.

“It does not require countries that have higher rates than 15% to lower their corporate tax rate, it just ensures that those countries will be able to collect at least 15%, no matter what type of creative tax planning a multinational comes up with.

“It will also reduce the incentive of multinationals to artificially shift their profits to low tax jurisdictions because they will still have to pay a minimum of 15%.”

She added: “It will also relieve the pressure on developing countries to offer excessive, often wasteful tax incentives while providing a carve-out for low-taxed activities that have real substance. This means that developing countries can still offer effective incentives that attract genuine, substantive foreign direct investment.”

But Mukumba said the problem is not that the deal will not bring any extra revenue to developing nations, but that richer nations will get much more out of it.

“Developing nations want a global corporate tax minimum, they have pushed for it in the past. They will get revenue under this deal, yes, but nowhere near as much as richer nations will get out of it,” she said.

This is problematic at a time when many developing nations are struggling with the effects of the COVID-19 pandemic and need revenue.

“This [deal] will mainly support recovery efforts in the G7 countries instead of developing countries which have been most impacted by the COVID-19 pandemic and are more in debt, preventing them from generating enough revenues to recover from the crisis and ultimately throwing millions more people into extreme poverty,” said Kohonen.

Source

Malawi Diaspora

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