Farm sub­si­dies not big threat

South Waikato News - - What’s On - GER­ALD PIDDOCK

Mar­ket mo­nop­o­lies and not sub­si­dies are the big­gest threat to eco­nomic sus­tain­abil­ity in world agri­cul­tural mar­kets, says an in­ter­na­tional ex­pert.

Bel­gium-based Agri­cord man­ag­ing di­rec­tor Ig­nance Cousse­ment said the ex­is­tence of the mo­nop­o­lies made it dif­fi­cult for smaller farm­ers around the world to com­pete against larger scale ‘‘in­dus­tri­alised’ farm­ers within a na­tion’s do­mes­tic mar­ket.

How smaller fam­ily farm­ing en­ter­prises com­peted against these larger scale farms in the mar­ket was a tricky is­sue, he said.

‘‘The re­al­ity is for fam­ily farm­ers is to find a way to cope with that. Lets be re­al­is­tic on that, the big­gest dan­ger comes from mo­nop­o­lies, from agri-in­dus­tries that are too strong and con­trol mar­kets [that] con­trol ev­ery as­pect of mar­ket­ing.’’

Farm­ers had to be com­pet­i­tive and the best way for smaller farm­ers to achieve that were to form co­op­er­a­tives.

‘‘That’s the best counter-tac­tics we have.’’

Cousse­ment was speak­ing at a panel dis­cus­sion on sus­tain­able so­lu­tions for global agri­cul­ture tak­ing place at the In­ter­na­tional Fed­er­a­tion of Agri­cul­tural Jour­nal­ists’ an­nual congress in Bonn, Ger­many.

Cousse­ment’s or­gan­i­sa­tion, Agri­cord is an in­ter­na­tional al­liance of 200-300 farmer-based agri­cul­tural agen­cies in more than 60 coun­tries.

He said it made sense to have sub­si­dies in coun­tries that had to com­pete against cheap masspro­duced im­ports.

The role of sub­si­dies was a sub­ject of in­tense de­bate at the United Na­tions Frame­work Con­ven­tion on Cli­mate Change (UNFCCC) pro­gramme man­ager Ka­tia Sime­onova said.

From an eco­nomic purist’s per­spec­tive, sub­si­dies were very im­por­tant to in­tro­duce change in the way in­dus­tries were work­ing and the prod­ucts that were pro­duced.

‘‘But it’s also well known [in the] longer term, main­tain­ing the sub­si­dies leads to dis­tor­tions of the mar­ket and re­duc­ing its ef­fi­ciency.’’

In the­ory, sub­si­dies should not be main­tained over the long term, Sime­onova said.

How­ever, sub­si­dies were, in re­al­ity, never ap­plied solely for agri­cul­tural pur­poses.

They were linked to broader so­cial ob­jec­tives within coun­tries such as ru­ral de­vel­op­ment and em­ploy­ment.

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