What is the best way to help the people of Niger?
Posted on 16 August 2005
Anthony Batty wrote here about the famine in Niger and he is absolutely right that price controls would make a bad situation worse. It may also, slightly counter-intuitively, be true that simply shipping in hundreds of thousands of tonnes of free food would be a bad idea as well. There is a case for sending in the therapeutic milk and so on required to cure the children near death, but dumping our granaries of subsidized grain in Niger, a sort of Common Agricultural Policy Plus? That might help to pay off our farmers but it won't cure the problem in Niger. For, as several reports have pointed out, there is in fact no shortage of food in Niger:
Johanne Sekkenes, the mission head of MSF which is mounting the biggest emergency exercise in its history in Niger, says the current emergency could have been avoided. 'This is not a famine, in the Somalian way,' she said. 'The harvest was bad in 2004 and the millet granaries are empty. Yet there is food on the markets. The trouble is that the price of the food is beyond anyone's reach.
Ms Sekkenes then goes on to insist on a rather imperfect solution, that of giving away imported food. But perhaps a better solution is to provide those without with the money to purchase the food extant?
This will have an odd effect. It will raise the price of food in Niger. This will stimulate imports, yes, but it will also stimulate efforts to raise more food domestically in future. That is, that this will be a short term problem, not one where we destroy a country's agriculture for a generation.
The heavyweight economist on the subject of famine is Amartya Sen (pictured) and his study of the subject was much of what he received his Nobel Prize for. One of his points is that a famine can happen (and many of those that do occur are of this type, like the Wollo one in Ethiopia in 1974) not when there is a shortage of food, but when there is a shortage of money in the hands of those who wish to buy it. For example, pastoralist herders might find their export markets, even their domestic ones, ruined by a flood of subsidized exports from another nation (the manner in which the European Union has been subsidizing beef exports to North Africa and the Middle East is quite co-incidental). This would change their terms of trade, cattle for grain, and make them much poorer relative to the settled farmers.
This might even have been happening in Niger:
International agencies say the price of basic foodstuffs has risen between 75 and 89 per cent over the past five years. At the same time, the sale price of livestock - the main income source of the country's nomadic herders - has fallen by about 25 per cent.
Add in a normally-survivable drought and the herders slip from poverty into destitution and starvation. (It is also a highly visible signifier of impending hunger when meat and livestock prices plummet... all of the herders are trying to sell capital goods to gain current income at the same time.)
The basic analysis, that of Sen, seems to be true in this case. Food is available - there are people importing it - but there are people starving because they cannot afford it. The solution is to give those people the money to purchase the food. It is known in the trade as "dropping dollars out of helicopters" and while there may be more sophisticated methods of doing it, that is, in essence, what it is. And if it is our own disposal of the beef mountain that has contributed to the situation, perhaps we should be dropping euros?