Rising food prices 'concerning'

by Editor fleischwirtschaft.com
Monday, December 03, 2007

There is "deep concern" among the world's largest economies about rapidly rising global food prices.

Briefing the media at the end of the ninth annual meeting of the G-20 in the southern Cape coastal town of Kleinmond, Finance Minister Trevor Manuel said the worldwide surge in grain prices was mainly due to climate change.

It was attributed, partly, to the conversion of crops into biofuels, but mainly to global climate change.

The G-20 comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom and the USA. The EU is also a member.

Together, these countries represent about two-thirds of the world's population, and contribute 90% of its gross domestic product. In a "communiqué" document issued at the end of its meeting, the G-20 noted there was a "likely" slowdown in global economic growth, though this was expected to be modest.

While the slower pace of growth is expected to moderate pressures on capacity and resources, rising energy and food prices will remain an important source of price pressures.

Referring to the G-20's discussion on global economic growth, Manuel acknowledged the meeting had taken place at a time of "relative uncertainty" in world markets.

The communiqué said the forum had agreed that an "orderly unwinding" of global imbalances was a shared responsibility. It involved:

  • Steps to boost national saving in the US, including continued fiscal consolidation;
  • Further progress on growth-enhancing reforms in Europe;
  • Further structural reforms and fiscal consolidation in Japan;
  • Reforms to boost domestic demand in emerging Asia, together with greater exchange rate flexibility in a number of "surplus" countries; and,
  • Increased spending consistent with absorptive capacity and macro-economic stability in oil-producing countries.
Aiming to develop policies that promote "high and sustainable growth" of the world economy, the G-20 meets once a year.