By Chandran Nair, Global Institute for Tomorrow
The idea that a world of limitless connectivity, spreading democracy and freer markets promotes convergence and endless possibility may be fashionable, but it is far from the complete picture.
There is little appreciation that this idea is instead leading to a great “era of divergence,” as we see an expanding split between the lofty ideals of Western liberal thinking and the reality in much of the developing world. Possibility may be “limitless”, but the question remains: “limitless possibility” for whom? Read more
By Vladislav Baumgertner of Uralkali
Just last week US President Barack Obama spoke in Senegal about private sector commitments to tackle food security issues in Africa. Indeed the problem of food security is one of the most pressing global issues. Around 925m people, including over 200m children under five, are going hungry. The food riots we witnessed in 2008 and 2011 in more than 20 countries highlight how food vulnerability is a serious destabilising factor for economies. Read more
It turns out that President Nicolas Maduro thinks that the plan to introduce food rationing in Zulia, Venezuela’s most populous state, is “crazy”.
Regardless of whether he always thought that, or whether, perhaps, the increasingly unpopular president was responding to widespread rejection of the plan, he’s right – it is not the way to put an end to the problem of shortages that has become so acute that someone has even invented an app to help Venezuelans locate specific goods they are having difficulty finding. Read more
When is rationing not actually rationing? According to the government of Venezuela’s most populous state, Zulia, it is when restrictions on purchases of certain goods are actually intended to stop smuggling.
It’s true that a lot of contraband is sent from Zulia across its extensive border with neighbouring Colombia (quite a lot passes in the other direction, too, in the form of cocaine). But it’s also true that Venezuela is suffering from widespread shortages of all kinds of basic goods. Read more
Hard times. Authorities made headlines in Venezuela on Thursday after they wiped a warehouse clean of its stock of toilet paper.
While a lack of the most basic of necessities is probably no laughing matter for locals, onlookers are certainly smirking that Maduro’s top priority is now chasing down toiletries. Read more
A rising middle class, expanding population and stagnant local agricultural production are driving up Africa’s food imports. Bad luck is partly to blame. Weather-related damage has hit rice crops in Benin, Burkina Faso, Cameroon, Niger and Madagascar. Foot and mouth disease has hurt Egypt’s bovine sector, and cassava – one of Africa’s major offerings to world agricultural trade – is being felled by a fast-spreading virus.
But policy volatility is also at fault. Nigeria – Africa’s largest rice importer – announced a hike in import taxes last year which prompted a sudden rise in purchases. And across Africa, weak infrastructure hinders agri-markets.
After yet another spat over Venezuela’s persistent food shortages, President Maduro and the country’s largest privately held company, Empresas Polar, might finally be making amends.
Chávez’s successor opened the doors of the Miraflores presidential palace Tuesday night to Lorenzo Mendoza, the company’s billionaire boss, to discuss the country’s faltering food supply. Oddly enough, after spending days blaming each other for Venezuela’s barren store shelves, both sides emerged seeming have found a sort of common ground. Read more
Thinking of investing in India? There is one sector you may have overlooked: agriculture.
With its growing population, rising income levels and growing middle class, India has attracted the usual investment suspects of retail, aviation and FMCGs. But although it may not be glamorous and it may be politically complicated, India’s agricultural sector is set to expand fast. Read more
“No hay” (Spanish for “there isn’t any”) is a refrain that has become tiresomely predictable when asking shopkeepers in Venezuela if they have basic things in store – say, sugar for example – something that the Caribbean country ought to be able to produce in vast quantities. Read more
Droughts in the US have led to prices for corn and soy hitting record levels in recent weeks, and talk of a new world food crisis abounds. Previous price spikes in 2008 and 2010-11 created shockwaves throughout the developing world, leading to riots in more than 30 countries and, some argue, acting as a catalyst of the Arab Spring.
What are the likely emerging market impacts of the current market movements? Beyondbrics offers a (non-exhaustive) roundup of analysis on the Brics grain situation from the FT and elsewhere. Read more
Venezuela’s socialist government argued that it needed to play a bigger role in food distribution to put an end to the “hoarding and speculation” of unscrupulous capitalists. By doing so, this would ease shortages, prevent overpriced food, and generally make food distribution more efficient.
Well, if evidence presented on Thursday by an opposition deputy is anything to go by, the plan hasn’t worked very well: state-run food distribution agency PDVAL has been caught red-handed trying to secretly burn some 160,000 tonnes of rotten food. Read more
In a week when China hiked interest rates by another 25 basis points, it is not surprising that investors are becoming increasingly nervous about the impact of soaring inflation in emerging markets.
According to contrarian UBS economist Jonathan Anderson, however, such worries are misplaced. Most emerging markets are not even close to overheating, Anderson argues in a note released on Tuesday, and the few exceptions are already tightening aggressively. Far from being crushed under the weight of ever higher prices, emerging markets should see inflation starting to fall in around six months. Read more
It’s increasingly difficult for politicians to ignore rising inflation in emerging markets, as India is proving. Pranab Mukherjee, India’s finance minister, said on Friday that the current level of food inflation was not acceptable, according to Reuters.
On the same day, new data showed the wholesale price index, India’s main inflation gauge, rose an annual 8.43 percent in December – higher than forecast by economists and above 7.48 percent in November. Read more
A small decline in Indian food price inflation will bring policymakers little relief given the mounting price pressures in the country and around the world.
According to figures released on Thursday, India’s food price index stood at 16.9 per cent for the week up to January 1, marginally lower than the 18.3 per cent recorded for the previous week.
But, while price of pulses have fallen , spiralling prices for vegetables, led by onions, remain a cause for deep public – and political – concern. The common man finds it difficult to understand why vegetables cost over 70 per cent more than last year – and wants his politicians to help. Read more
Christmas is approaching, a time for feasting. In Venezuela, the favoured seasonal dish is the hallaca, a mix of meat, capers, raisins and olives held together in maize flour, all wrapped in plaintain leaves, and then boiled or steamed.
But after the government “suggested” the prices at which these ingredients should be sold earlier this week, Venezuelans are fretting there won’t be enough to go around. Christmas may be a time for giving, but some shop owners seem to think the government is going too far: the price caps are so low that they say they are being forced to sell at a loss. Read more