Friday, April 25, 2008

Food Inflation Watch: Ban Ki-moon urges action

The UN Secretary General Ban Ki-moon has urged all countries to contribute money to FAO (to the tune of $755 million) so that it can provide immediate relief to the most needy ones. The food crisis, triggered by rising prices, have turned violent and costly for governments around the world. The World Bank estimates that as many as 100 million people could go down the poverty line- a watershed in the achievements against poverty in last few years. Moreover, it also estimates that 33 countries are extremely vulnerable to chaos due to rising food crisis.

What I am wondering is why is it so difficult to raise $755, that too for a genuine cause? The developed countries organize so many development forums for developing countries and raise million of dollars in a day or two (for instance, for Afghanistan, Nepal, etc for reconstruction.) but why can't it do the same to solve this crisis? Everyone knows that the crisis is bubbling fast and it can explode any time, any where in the world, triggering a chain reaction (some say it might lead to "cold war" over food...a very exaggerated notation and prediction). Still, why are the developed countries so stingy in contributing money for a genuine, immediate cause? I can comprehend the economics behind it but not the politics. The champions of capitalism and free markets should be more concerned about calls for move to socialist state structure in Latin America due to capitalism's inability to deal with crisis in necessary items (remember, the president of Bolivia talked about revising capitalism last week!). This could prove more costly because it might accelerate the rate of move to socialist state in Latin America.

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