Martin Luther Oketch
19 August 2008
The World Bank has advised African governments to make fiscal policy adjustments to save millions of their citizens threatened by the rising food prices.
It is estimated that about 30 million people mainly in Africa could easily slip back into poverty as a result of high food prices.
The call comes amid rising food prices resulting from growing demand for food items across the continent.
The Senior Economist at the World Bank, Mr Robert Townsend, urged African governments to lower taxes such that people can have money to purchase food, increase investment in agricultural development and allocate resources channelled for agricultural development in a coordinated manner with the farmers.
Addressing a televised video conference from the World Bank offices in Washington DC, Mr Townsend said the increase in food prices is likely to go on until 2009 thus calling for policy adjustments by governments.
"The fiscal policy interventions can be divided into three broad classes: interventions to ensure household food security by strengthening targeted safety nets; interventions to lower domestic food prices through short-run trade policy measures or administrative action and interventions to enhance longer-term food supply."
Mr Townsend was speaking at a public lecture on the theme: "Current food and energy challenges in Africa and the response of the Bank and other international institutions."
It is estimated that the food crisis could push 100 million people globally into poverty reversing the gains made in poverty reduction over the last seven years. The World Bank has pledged to invest between $4 to $6 billion in agriculture over the coming year.
Africa is the most hit region by the rising food prices and the situation could go overboard with the increase in gas pump prices.
More than 30 million people on the continent are at risk because majority of households spend roughly half of their incomes on food.
Emergency food items are flowing into the continent to fill up the gap created by soaring prices for staples such as rice, maize, millet, and wheat.
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