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Policy Response to Challenges in Agriculture and Rural Development in the Europe and
Central Asia Region: Sharing Experience and
Enhancing Cooperation in the Region
William H. MeyersProfessor of Agricultural Economics
and Co-Director, FAPRIUniversity of Missouri
Twenty-Seventh FAO Regional Conference for EuropeYerevan, Armenia
13 May 20
Outline Food price surge and (partial) retreat Macroeconomic crisis and (slow) recovery Diverse impacts of and response to the crises How is food security jeopardized? Major uncertainties, challenges and
opportunities Policy priorities for discussion Short term Medium to Long term
Comparison of real GDP growth rates in selected regions
-8
-6
-4
-2
0
2
4
6
8
10
World
Major advanced economies (G7)
European Union
Central and eastern Europe
Commonwealth of Independent States
Diverse impacts on real GDP growth rates in Europe and Central Asia, 2009 to 2011
-20
-15
-10
-5
0
5
10
15
20
Uzbe
kista
nTu
rkm
enist
anAz
erba
ijan
Alba
nia
Tajik
istan
Kyrg
yz Re
publ
icPo
land
Kaza
khsta
nTF
YR M
aced
onia
Belar
usBo
snia
and
…Se
rbia
Mon
tene
gro
Czec
h Rep
ublic
Croa
tiaGe
orgia
Slova
k Rep
ublic
Bulga
riaTu
rkey
Hung
ary
Slove
nia
Rom
ania
Repu
blic
of M
oldo
vaRu
ssian
Fede
ratio
nEs
toni
aUk
rain
eAr
men
iaLa
tvia
Lithu
ania
2009 2010 2011
Diverse response: share of stimulus in GDP and importance of social protection in the stimulus
0 5 10 15 20 25 30 35 40 45
Georgia
Kazakhstan
Turkey
Russian Federation
Poland
Germany
Slovenia
Czech Republic
France
share of social protection (where available) total stimulus as % of 2008 GDP
Diverse structure: share of rural population in the total, 1992 compared with 2008
0
10
20
30
40
50
60
70
80
1992 2008
Success in growth of net exports from the region
-505
10152025303540455055
Ukraine
Russian Federation
Kazakhstan
How is food security jeopardized?
Reduction in the quantity and/or quality of food purchases High food prices Loss of employment or reduction of wages
and income Market disruption or policy reaction that
impairs availability
How is food security jeopardized?
Reduction in food production High prices of feed and other inputs Lack of credit access
Reduction in the quantity and/or quality of food aid High food prices Decline of government/international donor
financial resources Macro instability, market disruption or policy
reaction that impairs availability
A more uncertain future1. Road to economic recovery?
2. Timing and size of oil price volatility?
3. Will biofuel policies change?
4. Will other policies be unstable?
5. Will DDA be completed in near term?
6. Climate change and policy impacts?
7. Wider range of possible outcomes
8. Complicated decision making and planning
9. Larger impacts on low income consumers
Challenge and Opportunity
1. Challenge – devise strategies that are sustainable in very uncertain conditions
2. Opportunity – focus on policies that contribute to long-term policy goals
3. National and international policy actions needed
Short run Long run
Policy priorities
Short run Prudent use of limited budget resources Avoid short-term policies that conflict with long-term
goals Food assistance and early warning Twin track approach – food aid and production aid Continue economic and structural reforms Complete the Doha Round of trade negotiations,
Restore trust in the international trading system and advance new member accession
Policy priorities Long run (but start yesterday)
Increasing economic growth is best strategy Investment (not land grabs) in agric. development
AND R&D for production and post harvest Improve market functioning to facilitate price
transmission and integration with global markets Risk management tools for farmers-men and women Enhance rural development and rural infrastructure
investments Invest in social protection or safety net measures to
protect vulnerable populations
Conclusions Not simple formulas or quick remedies
Conditions in the region are diverse Situation is very volatile and persistent
Engage policy dialogue among experts in the region exchanging successes and failures Food and agricultural policies and reforms Climate change adaptation and mitigation
Dialogue begins here at high level but can continue among expert groups
