Can a food crisis be avoided?
Russia’s invasion of Ukraine has already resulted in export restrictions covering more than 16% of internationally traded calories, having surpassed the highest level of restrictions adopted during the food price crisis of 2007-2008 in March of this year already.
New export measures include India’s ban on wheat exports and a government proposal in Slovakia to implement a national export authorization scheme for cereals and oilseeds. The Indian ban resulted in a wheat world market price increase of 6% within 24 hours of its announcement, despite India being only the eighth largest wheat exporter globally. It is an indication of the severity of the current supply crunch and market volatility.
The dangerous dynamic threatened by food and fertiliser export restrictions around the globe will be met with little to no legal disciplines from WTO rules and litigation. EU law, however, can prevent member state and EU governance failures induced by the prisoner’s dilemma logic of agricultural export restrictions. Monitoring and export authorisation requirements at EU level, as a last resort, can help maintain internal market functionality and EU export flows to third countries. In addition, export restrictions should be monitored, and governments that impose them should be named and shamed to raise awareness of the magnitude of the problem. Important transparency work in this field is done by the Global Trade Alert initiative and IFPRI’s food and fertiliser export restrictions tracker. From the trade policy toolkit, unilateral food tariff reduction and elimination can be highly conducive to decreasing prices for domestic consumers and enhance market functionality.
Food security: the role and limits of international rules on export restrictions
By: David Kleimann – Bruegel
