Who is USAID Really Helping?

As hearings begin for the 2012 Farm Bill, Washington is being urged to re-think its foreign food aid policies, procedures, and spending.

Currently, food aid coming from the USA makes up about 1/2 of the world wide total. Of this large amount of cereals, pulses, and vegetable oil 40% comes from just three large firms. As it stands today, the Farm Bill (with its $2 billion budget) is set to benefit these three companies more than the world’s hungary.

At the moment, food is purchased by USAID (US Aid for International Development) in the USA and shipped to where it is needed. This transportation accounts for 60% of the total cost of aid and takes 3-6 months to arrive at its destination. Once it has been delivered, a portion of the food is sold by aid agencies at local markets to fund their development projects in the area–this is called “monetisation”. This has cyclical consequences: not all the food goes to the hungry–> local markets are flooded with American products, which are preferred by consumers–> local growers can’t sell their produce at a fair price–> local growers become impoverished and become part of the hungry. In this way, more than 1/3 of every dollar spent on foreign food aid is wasted and benefits large corporations instead of the world’s hungry.

If the world’s hunger is to be reduced, it is essential that there is a re-evaluation of budgeting and goals. Analysis of a pilot project to buy US food aid in the country it is needed showed that purchasing some grains and pulses locally would result in a +50% cost savings and would allow the products to get to their destinations 60% (14 weeks) faster than if they were shipped from the USA. This is particularly imperative with the soon expected food emergencies, such as in Sudan where the traditional model of food aid would not be able to bring enough supplies quickly enough for the 400,000+ people already displaced by clashes. Furthermore, this would create positive cyclical consequences: locally purchased foods–> local farmers benefit by selling to US aid and being able to sell their products at a fair price at local markets–> local farmers don’t go hungry–> less food aid is needed–> greater savings in USAID dollars over time. As well, this would help decrease the USA’s giant biological footprint.

Furthermore, NGOs are pushing for more “untied” USAID dollars for more sustainable and creative ways of fighting world hunger than just providing handouts. However, strong agriculture lobbying groups will prove this to be a challenge as they have in the past. For example, a push by the Bush administration in 2005 for Congress to let USAID purchase 1/4 of the food donated locally failed.

Luckily, there has been a recent international trend which is shifting towards cash-based aid and buying from producers in developing countries. Perhaps now the times will be more favourable for a long needed paradigm shift when it comes to foreign aid.

MALNUTRITION

Asma Lateef, director of the Bread for the World Institute, says USAID should also aim to meet key nutritional goals, especially for pregnant women and children under the age of two. This comes as the negative and permanent ramifications of inadequate nutrition within the first 1,000 days of a child’s existence are becoming widely recognized.

“At a minimum, we should begin to include goals on nutrition as a measure of the impact of U.S. food aid,” says Lateef. “It’s really important to have a discussion on how food aid can be better aligned with broader development goals.”

Information derived from:
http://www.trust.org/alertnet/blogs/alertnet-news-blog/washington-urged-to-stop-wasting-food-aid-dollars

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