World hunger declines when peace and sound economics prevail

Reports in most countries claimed that world hunger was increasing, ostensibly based on a new report from the United Nation’s Food and Agricultural Organisation (FAO).

The FAO report, ‘The State of Food Insecurity in the World 2003’, covers under-nourishment in the developing world only. It covers the period from base years 1990-1992 to 1999-2001. During that time the number of under-nourished people dropped both in raw terms, from 816.6 million to 797.9 million, and in percentage terms, from 20 percent to 17 percent.

But if you divide the period into halves a slightly different picture emerges. For the first half of the period the raw number of under-nourished dropped. Then in the second half it increased to 797.9 million. However, the increase in the second half is less than the decrease in the first half, meaning that overall the number of hungry declined by 18.7 million. During that same period the population of the developing world increased by a massive 662.2 million. This means that within a 10 year period about 681 million additional people were being fed adequately.

The choice of the base year can also determine how dramatic the decline in hunger will appear. The report uses as its base the years 1990-92. Had the UN gone back one decade further, the decline would have been more impressive since in 1990 28 percent were hungry. While the improvement may have slowed we shouldn’t lose sight of the fact that this is still an improvement.

This general improvement in under-nourishment rates remain true across most of the globe. During the last decade, hunger rates dropped in Asia and the Pacific from 20 percent to 16 percent; in Latin America and the Caribbean from 13 to 10 percent; and even Sub--Saharan Africa dropped from 35 to 33 percent. Only in the Near East and North Africa did rates go up, from 8 percent to 10 percent. Some of the sub regions saw rather impressive declines. East Africa saw a decline from 44 percent to 39 percent; Southern Africa declined from 48 percent to 41 percent; West Africa dropped from 21 percent to 15 percent; East Asia went from 20 percent to 16 percent; and South American declined from 14 to 10 percent.

Such large regional drops were ignored by some of the press. The New York Times, for instance, reported: ‘Only 19 countries, including China, reduced hunger among its people throughout the 1990s.’ Their reporter misread the report which said: ‘In 19 countries, the number of chronically hungry people declined by over 80 million between 1990-1992 and 1999-2001.’ The report didn’t say that only these 19 countries saw hunger reduced. In fact the report only covered developing countries most likely to be a problem. In addition the statistical tables in the report show that of the 90 countries surveyed 32 saw a reduction in the number of under-nourished people. Sixty of them saw the percentage reduced from a decade ago.

The real problem is that a few spots in the world are suffering badly. Hunger is up from 10 to 14 percent in the Near East; in Central Africa it is even worse. Hunger rates there went from 35 percent to 58 percent. By looking at the nations that saw dramatic shifts in under-nourishment the major causes of world hunger today become discernible.

In China free market reforms are clearly having a positive effect. At the beginning of the last decade the there were 193 million under-nourished people in China. Even though the population increased by 105.5 million the number of undernourished declined by almost 58 million. The percentage of under-nourished dropped from 16 percent to 11 percent. On the other hand, hard-line socialist North Korea saw the opposite happen. In a decade the percentage of hungry grew from 18 to 34 percent.

In Vietnam markets were liberalised and the number of undernourished dropped from 27 percent to 19 percent. In Venezuela a ‘pro-poor’ socialist government took over management of the country and the rate of under-nourished jumped from 11 to 18 percent. It quickly becomes clear that world hunger today is not caused by a strain on the planet or an inability to produce food as many environmentalists have contended. Hunger today is primarily a politically-induced problem. The FAO’s Director General, Jacques Diouf, said: ‘Bluntly stated, the problem is not so much a lack of food as a lack of political will.’

Hunger is routinely caused by bad economic policies or armed political conflict. The cessation of armed conflict in Angola brought under-nourishment rates down from 61 percent to 49 percent. In Mozambique the ending of the civil war there saw a decline in under-nourishment from 69 to 53 percent. In contrast the continuing conflict in the Democratic Republic of the Congo has increased the rate from 31 to 75 percent. The FAO report noted: ‘Eight countries suffered [food] emergencies during 15 or more years during 1986-2003. War or civil strife was a major factor in all eight.’

A key factor in reducing hunger is the economic growth rate of the country. The report notes: ‘In countries that succeeded in reducing hunger throughout the nine-year period, GDP per capita grew at an annual rate of 2.6 percent.’ If, as the report notes, a strong economic growth rate is associated with a reduction in hunger, then globalisation is critical to ending world hunger. One World Bank report has noted that ‘the more globalised developing countries have increased their per capita growth rate from 1 percent in the 1960s, to 3 percent in the 1970s, 4 percent in the 1980s, and 5 percent in the 1990s. Their growth rates now substantially exceed those of the rich countries....’ The FAO report acknowledges this: ‘Overall, countries that are more involved in trade tend to enjoy higher rates of economic growth.’

Yet various African nations still have state monopolies for the marketing of agricultural goods. Typically, such marketing boards underpay farmers for any surplus goods and then sell the goods globally at market rates. The surplus is used by the state or by various politicians for their own benefit. Increased globalisation won’t help these nations since domestic policies prevent the benefits from accruing to the people. As the International Food Policy Research Institute noted, ‘for most African farmers, globalisation of agricultural markets will make no significant difference to their livelihood opportunities until considerable improvements are made in infrastructure and marketing institutions.’

Today the West gets blamed for agricultural protectionist policies that keep out Third World goods. A change in such policies is needed immediately. But such changes will only help countries that have liberalised their domestic markets. Generally speaking nations that have liberalised domestically are not the ones that are still suffering high rates of hunger. The nations that are starving are mainly the victims of local politics and intra-governmental warfare. The planet can well feed the numbers we have now and many, many more. The problem isn’t one of unsustainable development or our ability to produce. It’s more a problem of getting governments out of the way.

Author Jim Peron is President at Laissez Faire Books. This article may be republished without prior consent but with acknowledgement to the author. The views expressed in the article are the author’s and are not necessarily shared by the members of the Free Market Foundation.

FMF Feature Article\9 December 2003 - Policy Bulletin / 03 November 2009