An end to food aid?

There is unlikely to be an early end to the practice of monetised food aid despite the decision by the aid organisation CARE International last week to withdraw from US food assistance programmes.

Monetised food aid, whereby donors provide food in kind, which organisations can then sell locally to raise funds for development projects, is controversial for a number of reasons:

• Food aid is shipped from the donor country which, since it is often some distance from the target area, decreases efficiency and incurs costs to the donor.
• Aid agencies selling the food on local markets are not expert marketers and cannot be sure how much they will raise -- experience also suggests that food aid is more plentiful when harvests are plentiful and world food prices are low.
• Food aid ‘dumped’ on local markets can further depress local prices, depending on the commodity -- undermining local farmers.
• Governments in countries receiving food aid are less likely to invest in domestic production of the same crops, to the detriment of the development of the agricultural sector.  Countries thus become dependent on food aid.

The United States is far and away the largest food aid donor, and is unlikely to end the practice soon.  This is because it fits into a larger US picture, which includes a powerful agribusiness lobby and generous government production subsidies for certain 'program crops'.  Thus, commodities already subsidised end up purchased by the government and shipped as aid.