Better use of markets is the way around volatile food prices, World Bank President Robert Zoellick argues. The chief of the Washington-based lender has identified several approaches to help utilize markets in preventing food price hikes.
“The answer to food price volatility is not to prosecute or block markets, but to use them better,” Zoellick writes in an opinion-editorial piece published in the Financial Times and the World Bank website.
Increasing the public’s access to information on the quality and quantity of grain stocks can help to calm “panic-induced” food price spikes, Zoellick suggests. He also recommends taking into account the relationship between international food prices with local ones in poor nations.
Explains Zoellick: “Factors such as transport costs, crop types and exchange rates can mean that local prices are delinked from international prices.”
The World Bank chief also suggests providing access to fast-disbursing support in place of export bans or price fixing.
“To help countries avoid policies that harm their own farmers and neighbors, we need to provide reliable, fast alternatives customized to local needs,” he says.
Humanitarian aid should also be exempt from export bans, Zoellick adds.