Negative Effects Of Food Aid

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1.0 Introduction This report aims to explore people’s positive and negative views of food aid on the economy. The report will also provide background to the debate, its social significance, identify the parties involved and put forward the differing arguments related to the views held. 2.0 The Issue and background to the debate. The population on earth has been growing exponentially causing food shortages therefore being one of problems for food prices to rise. Other implications are ethical, political and economic issues in food aids uses on fighting starvation and hunger. 3.0 The social significance of the debate. Food aid is about 20% of global aid in the 1960s, since that time, it is now less than 5%. Food Aid’s declining resources (e.g.…show more content…
government had accumulated huge amounts of wheat and corn as part of its price support programs. The large amount of crops caused markets to depress leading to Section 416(b) program. Statistics show the eventual change when the government changed the federal price support program to support the decreasing amount of crops every year until 2006, where the crops eventually depleted. As a result, government grain stocks were eventually depleted by 2006. “For most LDCs, food aid was never part of any development policy, other than the one in support of export growth for developed countries”. Mousseau, F. (2005) Opinionators state that cheap grain and other foods that are highly subsided are dumped onto the local economy of the recipient country, because of that small domestic producers in the recipient country are unable to compete fairly because the recipient’s government is encourage to take down protections on their own farming sectors. The producers lose their business, becoming jobless or join prospects in the big cities. Statics show that the providing country’s economy shows ideal exports of cash crops making food aid cheap. It causes business in the recipient country to work at lower wages further causing people in the recipient countries to…show more content…
(2005) Extra money are paid to suppliers and shippers increasing the overall cost of food aid, raising the cost of food aid by more than a 100 percent compared to local purchases. There is fluctuations in sharing food aid because of low supply and high demand for food aid. As statics show, food aid is prioritise (between 1990 and 2004), showing the fact that in times cereal prices being low internationally (e.g. 1993 and 1999). It is shown that food aid is likely tied to commercial transactions during times of depression in the market. Therefore, food aids recent increase in demands is not dictated by priority groups but the crop prices. Furthermore, during periods of need for food aid, supply can drop due to increasing cost of food imports. Furthermore, additional costs like biofuel crops have increase crop prices; fuel costs also affect agriculture and shipping sectors. Lastly, fluctuating currency affects the cost of food imports, making it harder for the recipient countries to recover from their debt. 6.0 Conclusion From the discussion above it is very clear that there are different opinions on the issue of food aid. This has been going on for several decades and will still continue as our population grows. “Whichever way it is looked at, food aid certainly needs readdressing to make it more effective for recipients, not just

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