Roundtable | Food Crisis in the Context of the Russian-Ukrainian Conflict (2): How to Deal with It to Avoid More Turmoil in the World?

The Paper's special contributor Jian Junbo Bai Yiwei He Jiajie Ma Bin Xie Chao Yu Hongyuan Yu Min Zhang Yaning Zhou Yuyuan Zou Zhiqiang

People eat for the day: Will the problem of eating further induce other crises?

Jian Junbo: The food crisis is one of many global problems, in the state of interdependence of various global problems, will the food crisis trigger other problems or even major crises? For example, will chronic food shortages trigger refugee flows or social unrest in some regions, or even drastic changes in the political ecology of some countries?

Bai Yiwei: The most immediate consequence is that European countries that are not completely self-sufficient in food have become concerned about the so-called loss of food sovereignty. Some EU countries have expressed dissent with the EU's Common Agricultural Policy (CAP), especially those that favor "moderate growth" in agricultural production and global self-reliance. Food self-sufficiency and food security will become new issues within EU member states that are eurosceptic and promote the political power of sovereignism, exacerbating domestic right-wing voter dissatisfaction with Brussels. There is no doubt that with rising food and gasoline prices spurring inflation, it will become increasingly apparent that people are demanding that the EU avoid reducing agricultural production and restore pre-crisis production.

Zhou Yuyuan: Food crises in some countries often become the trigger for national political and social unrest. In these countries, the food crisis is an important manifestation of the political, economic and social problems of the country, and in a specific period, the food crisis has triggered or activated the dissatisfaction of the people with the government and the status quo.

The food crisis since 2020 has many similarities with the food crisis between 2007 and 2008, such as the FAO Food Price Index rising from 94.2 to 117.5 in 2007-2008 and the index from 95.8 to 127.4 in 2020-2021. In Africa, rising food and oil prices are an important trigger for social protests and even political unrest, as exemplified by social unrest in countries such as Senegal in 2008, the Arab Spring in 2011, and the fall of Sudan's Bashir government in 2018. Therefore, African countries have a potential social contradiction transmission chain from the fuel crisis to the economic crisis, and then the development crisis until the political crisis, which deserves attention.

However, the food crisis is only the trigger, and whether it will trigger other crises is still rooted in the political, governance and development problems of the country. From the current point of view, most African governments still attach great importance to food security, and the international community is also highly concerned about food security in Africa, which is also worried that it may trigger political and social unrest and chain problems such as refugees. Overall, the current risk of food security triggering large-scale political instability in Africa is low. The problems facing African countries at the moment are the superposition of multiple crises, namely food crises, energy crises, debt crises and development crises, and if this reality persists, the likelihood of triggering political and social unrest is highly likely to increase.

Zou Zhiqiang: Food prices in the Middle East are highly socially and politically sensitive. Behind the outbreak of the "Arab Spring" in 2011, the rise in food prices caused by the reduction of basic food subsidies and rising food prices has led to public dissatisfaction, and then the outbreak of revolution led to regime change, commonly known as the "Big Pie Revolution". Therefore, the governments of Middle Eastern countries have basically continued the tradition of high proportion of food subsidies, dare not easily increase the price of basic food, and regard controlling inflation and maintaining food price stability as a priority task. At the same time, Gulf oil producers, European countries and international institutions are also providing financial assistance to Jordan, Lebanon and other countries facing food crises in various ways. At present, the food crisis has not yet significantly affected the social and political stability of the countries of the Middle East.

How did the food crisis break? All parties are acting, and Russia, Europe and the United States accuse each other

Jian Junbo: In the face of the current food problem, how will Europe and other affected countries respond or deal with it? For example, can Europe reduce the cost of agricultural production by increasing farmers and agricultural subsidies, and is there a corresponding financial resource to support it in other regions? Or let's go back to the Russian-Ukrainian conflict, which has exacerbated the food crisis, and what should Russia and Ukraine do to solve the current food security dilemma?

Bai Yiwei: In the face of the current food crisis, the EU has taken urgent measures, the main purpose of which is to prevent farmers from going bankrupt, as farmers face exponential increases in production costs (especially livestock) and compensate for the losses caused by their reduced dependence on plant proteins in the Black Sea Basin.

In addition, depending on the importance of agriculture to different member states, the European Commission has issued 500 million euros of emergency assistance to EU agriculture, with countries deciding how to distribute it. France will support its livestock industry and Poland will use it to purchase inputs and fertilizers. The removal of the upper limit on subsidies for certain agricultural production is also part of the response, in the context of continued compliance with the EU's common market on a level playing field. The European Commission also encourages member states to prioritize investment in their national strategic plans to reduce dependence on fossil fuel and feedstock inputs.

Zhang Yaning: In the face of rising agricultural prices and supply chain turmoil, the EU has adopted a package of emergency measures and other medium- and long-term measures. First, the European Commission proposed a series of contingency measures on March 23, including 500 million euros of agricultural aid, relaxation of legal restrictions on agricultural subsidies in member states, and suspension of some EU regulations on the green transition of agriculture. Second, the EU is also negotiating with member states to allocate 7.5 billion euros of idle funds under the framework of the Common Agricultural Policy to subsidize farmers. Finally, in the longer term, the EU is also trying to accelerate the eventual signing of the EU-MERCOSUR Free Trade Agreement, diversifying agricultural imports to improve the resilience of food supply chains.

Yu Min: On April 28, the European Commission approved Spain's 169 million euro state aid program to support the milk production sector and alleviate the pressure on feed and fuel prices caused by the Russian-Ukrainian conflict. In addition, the Commission approved Belgium's 6.9 million euro state aid program to support farmers in sustainable agricultural practices that are conducive to the environment and climate, such as reducing fertilizer applications.

Ma Bin: Mitigating the impact of the Russian-Ukrainian conflict on the food market is part of the measures to resolve the global food crisis, but it can only be partially alleviated, and it cannot really solve the food crisis currently facing the international community, and the effect is mainly reflected in the short term rather than the long term. As important members of the international grain market, Russia and Ukraine move in opposite directions, which can have a positive impact on alleviating the current food crisis. Russia and Ukraine need to reach short-term special arrangements for the export and transportation of food, in particular to address the constraints on black shipping capacity. In fact, Ukraine is actively coordinating with its neighbors such as Romania and Poland to open new land grain transport routes such as railways and roads. For Russia and Ukraine, Europe and the United States and other relevant parties, reducing the willingness to "politicize the food issue" and abandoning the measure of "politicizing the food issue" is conducive to coping with and alleviating the current food crisis.

He Jiajie: In the context of low rice prices, there is currently an idea among Southeast Asian rice exporters (especially Vietnam and Thailand) seeking to join forces to raise rice export prices and benefit domestic rice farmers. Thais and Vietnamese countries are likely to once again propose to establish rice export cartels to increase bargaining power in global markets. But that approach is unlikely to work. Because if the rice is not sold within a certain period of time, the quality will decline, which will also affect the income of rice farmers.

What's more, India, as the largest rice exporter, accounts for about 40 percent of the international rice export market, while Thailand and Vietnam together account for only about 26 percent. At present, India has no intention of participating in the Rice Cartels in the Vietnam-Thai negotiations, nor has it received invitations from the two countries. If Thailand and Vietnam join forces to push the price of high rice, price-sensitive African countries will turn to buying Indian rice, which will benefit India's rice exports.

Xie Chao: In the short term, the Indian economy is quite dependent on its own grain exports. By 2021, India's agriculture and related industries will account for more than 20% of its total GDP, absorbing more than half of the country's population. Grain exports occupy an important position in India's national economy, and are one of the main ways to earn foreign exchange and ensure the income of the agricultural population, and the Indian economy cannot withstand the impact of a significant reduction in food exports. India's 2022 rainy season came earlier than usual, and abundant rain is expected to boost india's crop yields such as rice and oilseeds.

Zhou Yuyuan: African countries' imports of basic necessities such as grain and fuel account for a high proportion of national imports, and given the direct impact of their food security on people's livelihood and political legitimacy, African countries attach great importance to food security since the Russian-Ukrainian conflict.

On the one hand, they have had to use limited national finances to take measures to meet domestic food supplies, cope with rising food prices, and provide food relief, while on the other hand, they are actively seeking international support and exploring initiatives to restore global food supply chains. At the end of May, AU President Senegalese President Sal and AU Commission President Fakih held dialogues with EU leaders, whose main ideas included:

First, urge EU leaders to do whatever it takes to release food reserves and ensure the smooth flow of trade, markets and food corridors, warn European leaders to attach great importance to the possible disasters of food shortages and widespread price spikes, and call on the EU and others to lead international coordination to avoid duplication of action. Second, invest in African agriculture. This includes increasing eu-AFRICAN cooperation, promoting the progress of France's "Food and Agriculture Revitalization Initiative" and the AfDB's emergency plan, promoting large-scale investment in African agriculture, and improving Africa's agricultural production and supply capacity. Thirdly, new food corridors should be established as soon as possible to strengthen coordination between different programmes.

On June 3, Sal and Faki met with Russian President Vladimir Putin on the core of how to secure the food corridor. However, in contrast to european and American accusations that the current food security problem is caused by Russia's initiation of conflicts and blockades of Black Sea ports, Russia blames the current food supply problem on Western sanctions. Putin suggested that Belarus could be walked, demanding the removal of port mines laid in Ukraine. Putin's proposal was understood by African countries, and Sal also called on European and American countries on social media to ease financial sanctions against Russia.

Zou Zhiqiang: At present, Middle Eastern countries have generally adopted interest rate hikes to curb inflation, seek food financing assistance from regional oil-producing countries and the international community, and find more diversified food import channels.

What can international organizations and "big grain producers" do to alleviate the food dilemma?

Jian Junbo: Important international multilateral institutions such as the United Nations, FAO, and the World Bank have called for attention to the current food crisis. What role can international multilateral institutions play in responding to the current food crisis?

Ma Bin: The coordination of international multilateral institutions is one of the key measures to deal with the current food crisis, especially in the context of alleviating the Russian-Ukrainian conflict, such as "politicization of grain exports" and "politicization of the food issue", which are inseparable from the participation and good offices of international multilateral institutions.

Zhang Yaning: At present, many agricultural exporters around the world have implemented a certain degree of grain export restrictions, which have worsened the existing imbalance between supply and demand of agricultural products to a certain extent. In this regard, the World Trade Organization (WTO) could coordinate the provision of export restriction exemptions by food-exporting countries to humanitarian organizations and their aid projects (e.g., the World Food Programme), thereby ensuring basic food security in fragile regions that rely heavily on food imports, such as the Middle East and North Africa.

Zhou Yuyuan: International multilateral institutions, including FAO and the United Nations Food Programme, are important institutions in the global response to food crises. On the one hand, multilateral institutions should fully unleash the mechanisms and tools they already have, in particular focusing on food shortages for the most vulnerable, and avoid large-scale humanitarian crises. On the other hand, multilateral institutions should play an international coordinating role in providing a platform for dialogue and effective programmes for major global actors and stakeholders.

Jian Junbo: As food exporters, can "big grain producers" or key countries such as India, the United States, Turkey and Brazil make a difference in coping with the global food crisis?

Xie Chao: Since the outbreak of the Russian-Ukrainian conflict, India's diplomatic choices have had a significant temperature difference with those of European and American countries, which has led to the dissatisfaction of Europe and the United States with India's diplomatic posture for some time. European and American countries are hyping up the food crisis and alluding to India's restrictions on wheat exports as a suspicion of hoarding. In fact, India's share of the global wheat export market is still less than 1% despite rising year by year, and the vast majority of its wheat is used for domestic consumption, as well as as a strategic stock to prepare for disaster years and to suppress domestic food prices. The international market is concerned about India's grain exports, mainly whether the Indian government will further restrict rice exports. At present, India is the world's largest rice exporter, with 21.19 million tons of rice exports in 2021, accounting for more than 41%, which makes India have a decisive impact on food exports.

Food exports are becoming a tool for India to expand its influence and great power competition, such as food exports to the Middle East, especially the Gulf countries, including countries such as Egypt, as well as Afghanistan and the subcontinent, which will help to expand India's international influence. However, India's current policy is mainly to ensure its own food security. India's announcement of restrictions on wheat exports is only a precautionary measure to deal with food supply and price uncertainties caused by the delayed Conflict between Russia and Ukraine.

In the long run, increasing agricultural productivity is expected to increase global food availability. For example, India's arable land is more than 155 million hectares, far more than China's arable land, but the productivity is less than half of the mainland, and India's grain production capacity also has great potential to be tapped.

Yu Min: The U.S. Department of Agriculture (USDA) and the International Development Agency recently announced that the full balance of the Emerson Humanitarian Trust Fund will be used to address global food security challenges caused by the Russian-Ukrainian conflict, totaling $670 million, of which $282 million will support the procurement of U.S. food and emergency food action in six countries facing severe food insecurity in Africa; and $388 million will be used to cover land and sea transportation, handling and other related costs.

In addition, the United States will allocate $500 million from ukraine aid to subsidize its farmers to increase wheat production, including $400 million in temporary marketing assistance loans and $100 million in crop insurance incentives. At the WTO General Council, Brazil's ambassador to the WTO proposed the establishment of an emergency corridor for the transport of food and agricultural materials to ease the impact on Russian sanctions and China's epidemic prevention policies.

Zou Zhiqiang: Due to the maritime blockade and international sanctions brought about by the Russian-Ukrainian conflict, which has seriously affected the smooth flow of grain transportation and trade channels, Turkey hopes to play a greater role in opening up the grain exports of Russia and Ukraine, and actively discuss with Russia and Ukraine to open up a "grain export corridor".

Goodness itself also benefits the world: what can China do?

Jian Junbo: Let's go back to China. In the face of the current situation, how should China respond? Do the current agricultural policies and foreign agricultural trade policies need to be adjusted?

Yu Min: The mainland can deal with the current food problem from many aspects. First, through policy creation, we should enhance the enthusiasm of local governments in focusing on grain and growing grain among farmers, and firmly adhere to the bottom line of ensuring food security. The second is to expand the scope of import access, expand the channels of import sources, and increase the acceleration of grain and oil imports to increase domestic grain and oil reserves, so as to prevent the risk of poor supply and price fluctuations in the coming months. The third is to strengthen the guidance and regulation of domestic grain and oil trading enterprises and stabilize the domestic grain and oil market. The fourth is to strengthen supply chain support, implement the "Notice on the Pilot Project of Domestic and Foreign Trade Integration" issued by 14 departments including the Ministry of Commerce, support commercial and logistics enterprises to go global, integrate market resources, and establish an international marketing and logistics network.

Zhang Yaning: China has diplomatic needs, diplomatic responsibilities and diplomatic capabilities to help Africa tide over the food crisis within its capabilities.

First of all, affected by the Conflict between Russia and Ukraine, China is facing rising international pressure and increasing diplomatic frictions with the European Union and some neighboring countries. Playing a constructive role in the issue of food security in Africa is therefore one of the breaking points for improving the complex international situation currently facing the continent.

Second, China has always adhered to friendship with Africa, and the detached position of African countries in the current Ukrainian-Russian conflict has a great intersection with China. Therefore, helping Africa mitigate the negative effects of the food crisis and supporting Africa's independent foreign policy can significantly increase the space for mainland diplomacy.

Finally, China is not a direct participant in the conflict and has maintained good cooperative relations with both Russia and the European Union. China can join African countries in urging the EU to ensure that sanctions do not have a negative impact on agricultural exports and to step up efforts to provide non-humanitarian assistance; At the same time, Russia is called upon to play more active role in safeguarding food security in Africa.

Yu Hongyuan: The mainland has changed from a food recipient to a food aid country, and from a net investor to a net investor. For example, China has partnered with the World Food Programme (WFP) to provide food aid to South Sudan and implement school meal programmes. Through the South-South Cooperation Assistance Fund, the Chinese Government cooperates with the World Food Programme to provide emergency food assistance to five African countries. Since the outbreak of COVID-19, China has provided technical and material assistance to relevant countries affected by the epidemic and locust plagues, and has also provided emergency humanitarian assistance to Afghanistan. In addition, the mainland has also actively guided the dissemination of grain planting technology to underdeveloped grain-produced areas such as Africa, and promoted the development of the local food economy through the establishment of transnational grain and agricultural enterprises in the host country.

International humanitarian relief is a favorable path to shaping the image of the country, and it is also the due meaning of the major countries to shoulder their international responsibilities. Judging from the implementation effect of China's food aid, although it has been questioned by some countries, it has been recognized by the vast number of developing countries.

Zhou Yuyuan: Food security issues are mainly concentrated in developing countries such as Africa, which are an important part of China's current diplomacy, so China should play a greater role in responding to the global food crisis. Based on its relationship with Russia, China also has certain political resources to promote global food supply chains such as food corridors. On the one hand, China could consider providing humanitarian assistance to countries in urgent need of food assistance through bilateral and multilateral means under the framework of the Global Development Initiative; On the other hand, through the G20, BRICS summit and other platforms, it provides Chinese solutions for food corridors and global food security issues.

Zou Zhiqiang: For China, it should strengthen cooperation with international organizations, multilateral organizations in fragile areas such as the Middle East and Africa, and matchmaking in opening up diversified sources of food imports. It can also promote the G20 to give full play to the effectiveness of global governance, jointly oppose unilateral practices such as food protectionism and sanctions, and promote the smooth flow of global food trade channels.

Responsible editor: Zhu Zhengyong Photo editor: Le Yufeng

Proofreader: Liu Wei