Editorial: Put food high up the development agenda
Posted by Truth About Trade & Technology
Tuesday, 05 August 2008
Business Daily
Original Publish Date: August 4, 2008
Judging by resource allocation in past national budgets, the government has yet to get its priorities right in dealing with economic issues that are important to all households countrywide.
Since the country started off to a tumultuous year, the one thing that has been hurting every citizen — rich and poor — is runaway inflation.
Standing at below 10 per cent at the end of November and in the run-up to the December General Election that plunged the country into its worst political crisis in January, inflation shot up to more than 30 per cent in May, a level only reached in the early 1990s at the height of the infamous Goldenberg scam.
The Kenya National Bureau of Statistics tells us that this surge in inflation is directly linked to the scarcity of food in the economy and its direct link to the pricing of the commodity, which is the largest expenditure item in the budgets of poor households that are the majority in the country. And the evidence has been in there for us all to see.
In the month of June, for example, inflation eased marginally to about 29 per cent on account of a slight drop in prices of few items in the food basket such as vegetables.
Inflation slowed
Last month, inflation slowed down further on account of a significant drop in prices of cereals such as maize, beans and millet that are the nation’s staple foods. The easing of prices of these key food items has been linked to the onset of harvesting in Nyanza, Western and the South Rift.
Inflation is expected to slow down further, in the next two months, as farmers in the main cereals producing region of the North Rift begin to harvest their crops.
That inflation slowed down in July despite the fact that consumers had to bear the increasing burden of energy costs was most telling. In that month, the cost of petroleum products rose by an average of 15 per cent, while electricity costs jumped by large margins — nearly doubling.
Such a feat was possible mainly because food accounts for the biggest fraction of the national inflation index, taking up to 55 per cent of it compared to other components such as energy that accounts for only seven per cent of the index.
Pricing of food
Which takes us back to where we began.
If the pricing of food — which ultimately determines access to it — is this critical to our welfare as citizens of this country, why is this not reflected in the government’s key policy document that is the national budget?
Why do we continue to allocate huge amounts of resources to non-productive sectors of the economy to the detriment of the all important agricultural sector?
In the current financial year, for instance, all the five agriculture related ministries have been allocated less than Sh20 billion of the Sh760 billion national budget.
This is way below the eight per cent commitment that African countries made to allocate to agriculture under an African Union initiative to stem hunger on the continent.
Though the dilemma that the government faces with regard to resource allocation is clear, a solution may not be too difficult to find were the policy makers able to learn from other nations that have recently achieved the newly-industrialised status that we only desire to realise in 2030.
A look at Malaysia, South Korea, China and most recently Vietnam’s path to economic progress clearly shows that the journey began with the satisfaction of national food needs.
The fact is that a hungry people cannot participate in an economy out to produce desirable results.
This is the reason we urge long term solutions to the scarcity of food that is the main driver of inflation in the economy.
Recieve the latest news and commentary from Truth About Trade & Technology in your inbox every Friday with our newsletter subscription service.
Subscribing is easy and free, simply fill out th form below and you subscription will begin immediately. We protect your privacy, your e-mail address will never be sold or redistributed and you can unsubscribe at any time.
News 
.png)
