PowerPoint Presentation

Food and Nutrition Security Challenges and Priorities Madhur Gautam Lead Agriculture Economist Agriculture and Food Global Practice, The World Bank

5 TH GRWOTH & RESLINCE DIALOGUE

Outline

• Food and Nutrition Security Vulnerabilities: COVID-19 impacts and responses • Transformation of the Food System: priorities for building back better post-COVID-19 • Food System Transformation in Caribbean: Challenges and Strategic Priorities • World Bank priorities to support Sustainable Development in the Caribbean

April 15, 2021

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COVID-19: The Great Lockdown and FNS

• Unlike any crisis in 100 years – no supply or demand shock • But both impacted simultaneously! • Triggered a deep and widespread economic crisis • Significant and likely protracted impacts on food security • Access and affordability: massive loss of jobs/incomes, high prices • Availability: especially at local level (global, national ok) • Utilization/nutrition: perishables supply chains more impacted • Differentiated impacts across countries • Playing out through differentiated and multiple channels • Accordingly, responses need to be tailored to specific contexts

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Dramatic increase in poverty and acute food insecurity Poorest countries particularly hard hit

114 -150 million more poor people globally

123 million more acutely food insecure people in 2020 (in addition to 2019 estimate of 149 million people)

123

96

55

Millions of people

Total (79 Countries) Poorest countries (IDA)

Fragile and Conflict- affected Situations

World Bank (2020). Poverty and Shared Prosperity 2020: Reversal of Fortune.

WFP, 2020

April 15, 2021

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Large compounding domestic impacts of COVID-19

• Crisis² - Exacerbates existing vulnerabilities • Natural disasters (Irma, Maria), macro-issues • Widespread loss of jobs and incomes – rural as much as urban areas • Disruptions in domestic food chains • Double sided impact (farmers and consumers); Perishables worst hit • Labor and agricultural input shortages • Vulnerability due to high dependence on food imports, and exports • Large currency depreciations; demand collapse in importing countries • SIDS are particular risk – highly concentrated in a few exportables

April 15, 2021

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Global food markets: resilient but recent fluctuations Markets well supplied and food stocks near all-time highs

But well below the highs of 2011/12

Global food prices resilient through pandemic; up in recent weeks

100 110 120 130 140

150

130

110

90

40 50 60 70 80 90

70

50

30

2019M01

2019M02

2019M03

2019M04

2019M05

2019M06

2019M07

2019M08

2019M09

2019M10

2019M11

2019M12 Energy

2020M01

2020M02

2020M03

2020M04

2020M05 Non-energy

2020M06

2020M07

2020M08

2020M09

2020M10

2020M11

2020M12

2021M01

2021M02

2021M03

1/3/2011

5/3/2011

9/3/2011

1/3/2012

5/3/2012

9/3/2012

1/3/2013

5/3/2013

9/3/2013

1/3/2014

5/3/2014 Agriculture

9/3/2014

1/3/2015

5/3/2015

9/3/2015

1/3/2016 Export

5/3/2016

9/3/2016

1/3/2017

5/3/2017

9/3/2017 Cereals

1/3/2018

5/3/2018

9/3/2018

1/3/2019

5/3/2019

9/3/2019

1/3/2020

5/3/2020

9/3/2020

1/3/2021

Food

Unlike the 2007-2008 global food crisis, scarcity at global level is not an issue at this time Source : World Bank Commodity Price data, US Federal Reserve

April 15, 2021

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Yet, high and persistent domestic food price inflation, especially in poor countries OECS group bucks the trend Persistent food inflation (% yoy, food CPI) - greater than overall inflation (CPI); OECS food and overall inflation remains low

East Caribbean States

Food Inflation by Region

3.00

12

AFR

EAP

ECA

LAC

MENA

SAR

All Items

Food

2.00

10

1.00

8

-

6

(1.00)

Jul-20

Jan-20

Jun-20

Oct-20

Oct-19

Apr-20

Feb-20

Sep-20

Sep-19

Dec-20

Dec-19

Aug-20

Nov-20

Nov-19

Mar-20

May-20

4

(2.00)

2

(3.00)

0

(4.00)

Jul 20

Jan 21

Jun 20

Oct 20

Sep 20

Dec 20

Jan 20

Aug 20

Nov 20

Mar 20

Feb 20

May 20

Apr 20

Source : IMF and Trading Economics

Source : ECCB

April 15, 2021

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Caribbean – Protracted socio-economic impacts of pandemic: incomes (left), markets(middle) and food security (right)

0 10 20 30 40 50 60 70 80 90 100

Apr-20 Jun-20 Feb-21

Lack of market access

Change in shopping behaviour

Increase in food prices

Reduced food consumption

Lack of food stock

Disrupted livelihoods

Reduction/loss in income

Moderate to severe future livlihood impacts

Livelihoods

Markets

Food security*

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Looking ahead: time to take stock and evaluate

• Crisis evolving at different stages across regions and countries • Significant risks remain – 2 nd /3 rd /4 th wave(s) starting; slow recovery Risks • Rural areas as or more impacted than urban areas • Resurging rural poverty; gender impacts; labor displacement • Climate change intensifying • Fiscal stress on governments growing with prolonged crisis response • Slow recovery in tourism

April 15, 2021

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Food and Nutrition Security in the Short-term/Relief Responses

• Scale up safety nets : mix of food and cash where needed • Promote nutritionally balanced food packages • Reach informal MSMEs • Keeping food markets and supply chains open • Maintain “green channels” for food logistics; fit-for-purpose safety protocols • Apply digital and other solutions to connect sellers and buyers • Leverage local institutions for productive inclusion activities • Connect to existing/new markets through FPOs, SHGs, other local platforms/institutions

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Food and Nutrition Security in the Short-term/Relief Responses cont’d.

• Facilitate access to inputs for farmers • e-Commerce solutions to facilitate input purchase and service delivery • Access to credit or, where needed, targeted, one-time transfers • Business continuity for SMEs in food system • Support for worker retention and working capital requirements • Vast majority of food system actors are informal enterprises and workers • Ensure relief does not forestall LT sustainability of food system • Avoid indiscriminate, open-ended support • Only urgent, targeted and time bound measures

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Medium to long-term: Building back better

Resilience: • One Health agenda a priority to mitigate future pandemic risks • Design scalable/shock responsive safety nets with nutrition balance • Climate-smart agriculture: technology and practices • Support livelihood diversification on-farm and off-farm Sustainable Growth • Scale up investment in innovation systems and support services • Expand use of digital solutions to overcome traditional market and service delivery failures • Access to information; advisory services; e-trading; e-commerce; digital payments

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Medium to long-term: Building back better

• Address chokepoints in key supply chains & agro-processing • Regulatory and market reforms: promote private investment • Upgrading “wet” markets/infrastructure • Scale up digital technology applications • Scaling up innovative financing instruments (MSMEs, POs, VC financing) • Trade policy and facilitation reforms • Promote regional trade integration • Design of strategic food reserves • Repurpose agriculture policies and support programs • Fiscal stress: imperative to reorient public expenditures • Remove incentive distortions for technical and allocative efficiency gains

April 15, 2021

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Food system transformation in the Caribbean: Features

Food export as % of total exports

Country

AG as % of employment

AG as % of GDP

Belize

17 22 50 16

10 18 18

89

Guyana

9 2

Haiti

Jamaica

7

22

OECS Countries

11-26

2-13

38-78

Suriname

8

10

7

Food system: key issues • Nutrition: rising level of obesity, cost of nutritious/healthy diets is 2x (4x) cost of calorie sufficient diet • Low productivity: scale of operations and high transport costs • High vulnerability to climate change: long-term weather changes and extreme events • Underdeveloped Agriculture value chains and limited access to markets • Deficient agro-logistics and limited agro-processing • Low competitiveness, value addition and quality (food safety and standards): important for fresh food • Weak linkages to tourism and modern retail: large untapped potential

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Food system transformation in the Caribbean: Challenges

Vulnerabilities but also unexploited opportunities

0 100 200 300 400 500 600 700 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065 2070 2075 2080 2085 2090 2095 2100 Population Projections Anguilla Antigua and Barbuda Dominica Grenada Montserrat Saint Kitts and Nevis Saint Lucia Saint Vincent and the Grenadines

1. Small size of economies

1. Demand side: size of domestic market 2. Supply side: diseconomies of scale

2. Geography

1. High risks – vulnerability to climate change 2. High transport/logistics costs

3. Economic structure

1. Relatively small and fragmented farms 2. Changing marketing channels with globalization of food industry 4. Opportunities 1. High level of imported fresh food products used in tourism (60%) 2. Moving up age to more attractive value segments, value addition 3. Collective action to overcome diseconomies of scale 4. Technology upgrading to overcome high cost of labor, inputs

Tourism’s Contribution to GDP

42.7

40.7

40.5

36.9

28.6

28.2

Antigua and Barbuda

Dominica Grenada St. Kitts and Nevis

St. Lucia St. Vincent and the Grenadines

April 15, 2021

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Food system transformation in the Caribbean: Priorities

• Data systems • Critical for informed decisions on policies, monitoring socio-economic outcomes, early warning sytsems • Climate resilience • Climate smart agriculture, diversification, irrigation facilities • Technology and applications • Agricultural productivity: R&D, advisory services • Digital technologies: traditional market failures, transactions costs, information, service delivery • Inclusive and efficient value chains • Collective action –linking smallholders with value chains, strengthen access to markets and market information, crowd in private investment – productive alliances model • Food safety and quality • Food quality and safety standards, agro-logistics, quality of farm inputs • Reduce food loss and waste • Post-harvest handling, storage facilities, agro-processing, links to modern retail and tourism sectors • Incentives • Repurpose policies and public support to align incentives for a sustainable and nutrition smart food system • Foundational element for productivity on-farm and along value chain, private investment

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World Bank Priority Areas in the Caribbean

Guyana (and Suriname)

OECS

Jamaica

Belize

Haiti

 Resilience to natural

 Developing a low carbon

disasters/climate change.

 Sustainable and inclusive tourism and economic diversification.  Marine pollution and costal zone protection.  Climate resilient and inclusive agriculture.  Strengthening

development strategy (GY).

 Competitive and climate-smart agriculture.  Management and protection of natural resources/assets.  Flood management and infrastructure resilience.

 Urban regeneration and crime & violence.  Agriculture competitiveness and climate change.  Climate change for employment (incl. Blue Economy).

 Resilient and inclusive urbanization.  Strengthening basic services, incl. water and sanitation.  Addressing social contract and local governance.  Modernization of Agriculture and food security. 17

 Flood risk

management and resilience.  Conservation and inclusive development of the Amazon.  Addressing spatial disparities in basic services.

resilience to natural disasters.

OECS: Engagements

• Support recovery from previous disasters and build capacity for the future : • Technical Assistance on DRM and Disaster Risk Financing strategy • Transport and housing • Resilient agriculture • Improve capacity to monitor and forecast hazards and early warning systems. • Improving the sustainability of growth and livelihoods : • Effective management of protected areas • Integrated and sustainable coastal management • Strengthening agriculture competitiveness and resilience • Flagship studies on blue economy. • Supporting the development of a climate resilient program • Technical Assistance on NDC revision and climate investment planning • Strengthening the sustainable management of natural resources

18

Thank you.

5 TH GRWOTH & RESLINCE DIALOGUE

Global food markets: resilient but recent fluctuations Markets well supplied and food stocks near all-time highs

But well below the highs of 2011/12

Global food prices resilient through pandemic; up in recent weeks

100 110 120 130 140

100 102 104 106 108 110

150

130

110

90

40 50 60 70 80 90

92 94 96 98

70

50

30

2019M01

2019M02

2019M03

2019M04

2019M05

2019M06

2019M07

2019M08

2019M09

2019M10 Energy

2019M11

2019M12

2020M01

2020M02

2020M03 Non-energy

2020M04

2020M05

2020M06

2020M07

2020M08 2020M09 US Dollar Index 2020M10

2020M11

2020M12

2021M01

2021M02

2021M03

1/3/2011

5/3/2011

9/3/2011

1/3/2012

5/3/2012

9/3/2012

1/3/2013

5/3/2013

9/3/2013

1/3/2014

5/3/2014 Agriculture

9/3/2014

1/3/2015

5/3/2015

9/3/2015

1/3/2016 Export

5/3/2016

9/3/2016

1/3/2017

5/3/2017

9/3/2017 Cereals

1/3/2018

5/3/2018

9/3/2018

1/3/2019

5/3/2019

9/3/2019

1/3/2020

5/3/2020

9/3/2020

1/3/2021

Food

Unlike the 2007-2008 global food crisis, scarcity at global level is not an issue at this time Source : World Bank Commodity Price data, US Federal Reserve

April 15, 2021

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