- despite being a net food exporter
AGRICULTURE Minister, Robert Persaud, is cautioning that even though Guyana is a net exporter of food it is not insulated from the impact of global food prices.

In a statement to the National Assembly yesterday Persaud declared:

“We also need to understand that our status as a net exporter of food (the only country in the Caribbean basin which can claim this) does not necessarily cushion us against the impacts of the price of food, as the prices of the world’s commodities are a function of global supply and demand. And of course, we are particularly vulnerable to the inexorable rise in the cost of fuel and other inputs needed for food production…

So what is necessary, and this is why we have seen His Excellency, President Bharrat Jagdeo yesterday (Wednesday) unveiling a number of additionally pivotally important economic interventions to cushion the impact on Guyanese, especially the most vulnerable groups.”

The minister noted that across the world, the crisis has been unfolding at an alarming speed, whereby food prices have been increasing on a daily basis and by the end of last month in less than a year the price of wheat had risen by 130%, soya by 87% and rice by 74%.

However, he said there have since been some minor improvements in prices, with wheat falling by 40% since its peak in February.

“Although rice prices were expected to ease as producing countries respond by boosting rice production, we are currently witnessing the devastation of Myanmar’s rice crop (65% destroyed) by Cyclone Nargis. This is expected to have a significant impact on the price of rice, which is now most probably not going to record the improvement in prices predicted,” he observed.

He added: “As Joachim von Braun, the Head of the International Food Policy Research Institute in Washington, has said “world agriculture has entered a new, unsustainable and politically risky period” shown by the food riots that have erupted in countries all along the equator. This is in itself something which we must look at, however.”

Persaud asserted that the productive capability of countries clustered around the equator is climactically advantageous, and the region, rather than being the early indicators of social upheaval when food prices are affected can begin to look at these situations as opportunities.

“Guyana, although relatively better off, due to the aggressive steps taken by Government to cushion prices by zero-rating more food items and significantly reducing taxes on fuel whilst significantly increasing disposable income, is poised to take advantage of the opportunities. However, a concerted, patriotic effort is needed across the entire spectrum of our society to begin to grapple with the changes we must make. Our future can be a bright one, even as the world faces a dawn on whose horizon looms the issues of climate change and the increasingly erratic weather phenomena associated with it, unaffordable and increasingly unavailable fuel, and increasing demand for food as consumer patterns change in emerging economies and competition for food acreage from bio-fuels,” Persaud offered.

He also contended that the nexus of climatic impacts, geo-political strategies, energy inflation and fertiliser inflation, and shifting consumer patterns have formed an inter-related population of factors which all contribute to increasing food prices, whether they are emerging and their effects only now being felt, or they have been around for a significant length of time.

“What is clear is that the combination of global factors is now fuelling the current high prices across all continents and here at home.”

The factors identified by the minister include:

* Record oil prices have increased the cost of agricultural production by boosting the cost of fertilizer and pesticides, mechanized cultivation and transport of inputs to production and processing centres and outputs to markets. We have seen fuel go from below $30 a barrel to over $122 a barrel, in less than two years.

* Increased demand for food and change in eating habits. Rapid economic growth in many developing countries, especially China and India.