Saturday, May 3, 2008

Food Security - Our Basic Rights Molested

The last few weeks the whole world suddenly has been actively focusing on agflation, food shortage and food security. I guess this is due to the fact that crude oil prices were at around US$115 per barrel and hit US$120 on Friday the 2nd of May.

The United Nations has set-up a special commission to look into this food crisis. Former UN Secretary General Kofi Annan has called for a green revolution in Africa. He also accused the World Bank of ignoring the agriculture for the last two decades. Our PM has announced a RM 4 billion package for food security of which RM 2.5 billion is allocated for this year.

What surprised me was that in the midst of these announcements rice price in our rice bowl state of Kedah has shot up between 15-40% as reported by Bernama and the price controlled 15% broken grain rice was not available. How did this shortage suddenly happen? Isn't it BENAS' responsibility to make this available at all times? Rising prices of agriculture produce due to rising crude oil prices is understandable but a sudden shortage? Local price of diesel and petrol has not gone up in over a year so this cannot be an excuse. There was no draught, pest attack, disease or any other form of calamity to hit Kedah. So why has this acute shortage happened? The conclusion is hoarding and illegal exports. Why didn't our government see that coming? It was probably that they were too busy with the aftermath of the March 8 tsunami. Probably? No definitely!

In an earlier post I suggested that price inflation can be controlled by increases in interest rates, However Bank Negara does not agree with it although it was reported that our inflation is still rising. The PM says that raising minimum wage to RM900 would cause inflation to rise and it would just be a political gimmick but last year civil servants salaries were raised up to 45% and inflation was already setting in then. Was it not a political ploy for the 12th GE?

Could the government have stopped this? Yes they could have. License to import rice have been given only to a few. These are of cause the UMNO cronies and it has been going on for decades. A Chinese friend who is in the food import business told me that he could easily get rice from China but he has to go through the UMNO middle man who takes up to 10% cut for just operating from a desk with a computer and a fax machine. Malaysia imports 30% of its rice and this system has been in practise all the while however with the current world rice prices it is just not feasible to go through UMNO middle man. The government can start by removing these fleecing morons and making it an open market system where anyone can import rice and let the market decide the price.

Rice is our staple diet and we cannot change it however we can reduce the consumption by switching to alternative carbohydrates like potato. Potatoes are hardy produce and can grow easily and should be encouraged. Due to its nature and demand its import prices are also not hugely affected. The government should provide incentives to plant potatoes between other vegetables.

The Ministry of Health should get itself involved too. It should work with the Ministry of Domestic Trade and Consumer and take advantage of this food price increase to encourage healthier living. For instance the ceiling price of unhealthy controlled items like sugar and cooking oil should be increased forcing consumer to reduce consumption. Malaysian could do better with lower consumption of sugar and fried stuff, The incidence of Diabetes, Obesity and heart related diseases could be reduced in the next few years in Malaysia in return the cost of healthcare would be reduced. Millions or even billions of Ringgit could be saved here and be used improve food security or other development.

The government was right in setting the price of essential food items especially during festive periods to control profiteering by retailers and wholesalers. However the situation here is different as the suppliers themselves are charging higher prices as it cost them more now so how can the retailer limit themselves the ceiling prices that are set by the government. Hence the ceiling prices should be abolished or set much higher especially for unhealthy food items. And for the other food items, a mechanism should be set-up where the market strategically flooded to control the price.

The likes of Tesco, Carrefour and Giant keep their agro-produce low by going directly to the source hence eliminating the middle man. The produce are sent to special storage facilities where they are kept fresh, sorted, packed and then sent to the respective hyper marts. Not all Malaysians have access to the hyper marts. The government, in this time of crisis should do the same to eliminate the middle man by setting-up similar facilities for the smaller and rural players. Alternatively it should have special arrangements the hyper marts to have these benefits channelled to the smaller and rural players.

Household earning less than RM3000 should be given ration cards. This is still practised in many developing countries like in India. With our high tech MyKad we can implement this system much effectively. It can be only used foe essential food items and for a limited volume per month. A centralised system can be monitored for those trying to abuse the system. BonusLink and its likes are already popular where points are redeemed for gifts etc. Using the MyKad the designated retail or wholesale outlet can be reimbursed through the existing stockpile or from the food security funds that have been established. If it can work in poor countries than it I am sure can be implemented here.

Food security should have existed just like national security not when the crisis have started. Prevention was the way and that is why the Project Buku Hijau was introduced in the 70s. I still remember that its main objective was to increase rice yield by increasing the harvest to five times in two years. Last week it was reported in a local paper that an agriculture authority repeated this after more than 40 years. Why was it not achieved in four decades of high development? Food security is our basic right and the government cannot say that the crisis is happening all over the world. The issue here is that these plans put forward years ago and were not implemented properly and were hijacked by certain corrupt quarters for their own benefits and this is tantamount to molest of all Malaysians' rights.

1 Comment:

Stanley said...

The only viable way to get rid of these problems is to have a brand new federal government. Reboot the nation! Force reboot I mean (Ctrl-Alt-Del). Let the People Alliance press the keys. You need these three keys to restart.