Around 87 per cent of the 540 billion dollars given as support to agriculture producers by governments annually are price distorting that can be harmful for the environment and human health, according to a new UN report.
The report, “A multi-billion-dollar opportunity: Repurposing agricultural support to transform food systems” finds that the present support to producers mostly consists of price incentives, such as import tariffs and export subsidies, as well as fiscal subsidies which are tied to the production of a specific commodity or input. These are inefficient, distort food prices, hurt people’s health, degrade the environment, and are often inequitable, putting big agri-business ahead of smallholder farmers, the report added.
In the Report, the authors pointed out that about 811 million people in 2020 faced chronic hunger and nearly one in three people (about 2.37 billion) did not have year-round access to adequate food. It also noted that around three billion people could not afford a healthy diet in 2019.
Noting that majority of agricultural support of today has negative effects, the report said that about 110 billion dollar is given for infrastructure, research and development, and benefits the general food and agriculture sector.
In the report, the UN organisations mention about reconfiguring agricultural producer support, rather than eliminating it. It said that this would help end poverty, eradicate hunger, achieve food security, improve nutrition, promote sustainable agriculture, foster sustainable consumption and production, mitigate the climate crisis, restore nature, limit pollution, and reduce inequalities.
Director General of FAO QU Dongyu, said: “This report, released on the eve of the UN Food Systems Summit, is a wake-up call for governments around the world to rethink agricultural support schemes to make them fit for purpose to transform our agri-food systems and contribute to the Four Betters: Better nutrition, better production, better environment and a better life.”
The report points out that agriculture is one of the main contributors to climate change through greenhouse gas emissions from different sources, including manure on pastureland, synthetic fertilizers, rice cultivation, burning crop residue, and land-use change. At the same time, agricultural producers are particularly vulnerable to impacts of the climate crisis, such as extreme heat, rising sea levels, drought, floods, and locust attacks.
The UN report said that meeting the goals of the Paris Agreement required shifting support especially in high-income countries for an outsized meat and dairy industry, which accounts for 14.5 per cent of global greenhouse gas emissions. In lower-income countries, governments should consider repurposing their support for toxic pesticides and fertilizers or the growth of monocultures, it said.
UNEP Executive Director Inger Andersen noted that governments have an opportunity now to transform agriculture into a major driver of human well-being, and into a solution for the imminent threats of climate change, nature loss, and pollution, “By shifting to more nature-positive, equitable and efficient agricultural support, we can improve livelihoods, and at the same time cut emissions, protect and restore ecosystems, and reduce the use of agrochemicals,” she said.
INDIA AND ZERO BUDGET
The report also highlights cases from different countries where several processes began for zero budget farming. It highlights the case of Andhra Pradesh in India, where the state adopted a policy of Zero Budget Natural Farming. It also said that the 2006 reform of agricultural policies in China that supports decreased use of mineral fertilizers and chemical pesticides is another example. The Single Payment Scheme in the United Kingdom that removed subsidies in agreement with the National Farmers’ Union;, the European Union, where crop diversification has been incentivized through reform of the Common Agricultural Policy (CAP) and the Senegalese programme PRACAS to incentivize farmers to cultivate more diverse crops are some of the cases mentioned in the report.
Six steps governments may follow to develop and implement a repurposing strategy include:
- estimating the support already provided
- identifying and estimating the impact of the support provided
- designing the approach for repurposing agricultural producer support, including identifying needed reforms
- estimating the future impact of the repurposing strategy
- reviewing and refining the repurposing strategy, prior to implementation
- monitoring the outcomes of the new agricultural producer support