Trade and Food Security in Central Asia

1. Trade and Food Security in Central Asia Ekaterina Krivonos Trade and Markets Division FAO-Rome

2. Outline • Trade and food security – conceptual linkages • Food security and agricultural trade in Caucasus and Central Asia • FAO assistance to developing agricultural and food trade capacities in the region

3. Food security – main concepts • Millennium Development Goals: • Goal 1: Eradicate extreme poverty and hunger • Targets: between 1990 and 2015, halve the proportion of people who suffer from hunger • Progress: 980 million in 1990-92; 852 million in 2010-12 • Food security exists when all people, at all times, have physical, economic and social access to sufficient, safe and nutritious food which meets their dietary needs and food preferences for an active and healthy life

4. Food security – main concepts Dimensions of food security: • Availability: Having available sufficient quantities of food on a consistent basis • Access: Having sufficient resources to obtain food • Utilization: Nutrition, diversity of diet, food preparation • Stability: Risks to long-term food security Trade affects all these dimensions

5. Trade policy and food security • Changes in trade policy affect the relative prices of goods and factors => • Both food production and consumption are affected • Different impacts on different segments and population groups • Examples: • An export ban can boost domestic supplies and reduce prices in the short-run. Good for consumers and domestic food processors, bad for agricultural producers who export. • Trade liberalization is likely to reduce food prices to consumers and benefit competitive farmers, but the incomes of other farmers, and their food security, may be negatively affected.

6. Trade and food security – conceptual linkages

7. Inclusive and efficient global market systems • For countries to be able to participate effectively in global trading systems we need to address differences in opportunities among developing and developed countries (asymmetries) • Countries need specific and different national strategies and policies to benefit from international trade, improve livelihoods and pursue their own food security objectives (while taking account of food security needs elsewhere).

8. Food availability:Agricultural production in Central Asia Share of agricultural land and arable landin total land area, % (2011) Gross Agricultural Production Value (constant 2004-2006 million US$) (2011) Agriculture value added, share in GDP, % (2011) Source: FAOSTAT and WDI

9. Food availability:Food production in Central Asia Average value of food production, int.$ per capita Between 2000-02 and 2008-10, the value of production per capita in Caucasus and Central Asia increased by 27%, double of global growth. Source: The State of Food Insecurity in the World, 2012, FAO, Rome

10. Agricultural trade in Central Asia Value of agricultural exports and imports in 2010 million US$ Trade balance in agricultural products million US$ Source: FAOSTAT

11. Food imports and vulnerability Value of food imports over total merchandise exports, % Cereals imports dependency ratio, % Imports/(production+ import-export) Source: The State of Food Insecurity in the World, 2012, FAO, Rome

12. Agricultural exports Agricultural exports are heavily concentrated in few products • Azerbaijan: Oils and fats (31%*), sugar (24%) and fruits (13%) • Kazakhstan: Wheat (49%) and wheat flour (29%) • Kyrgyzstan: Beans (16%), cotton lint (12%) and fruits (12%) • Tajikistan: Cotton lint (49%), tomatoes (15%), onions (15%) and dried fruits (14%) • Turkmenistan: Cotton lint (79%) and cotton linter (11%) • Uzbekistan: Cotton lint (62%) and fruits (12%) *Share in the total value of agricultural exports in 2010

13. Economic access to food Domestic Food Price Level IndexThe ratio between food purchasing power parity (FPPP) by the General PPP Between 2000 and 2012, food prices (relative to the price of generic consumption basket) in Caucasus and Central Asia increased by 26% Source: The State of Food Insecurity in the World, 2012, FAO, Rome

14. Food security - Outcomes Prevalence of undernourishment Proportion of the population estimated to be at risk of caloric inadequacy, % Percentage of underweight children among all children under 5 years (2005-06) Note: The dotted line represents <5% Source: The State of Food Insecurity in the World, 2012, FAO, Rome

15. FAO’s support to more inclusive and efficient markets • FAO provides analytical information, facilitates evidence based policy advice and offers technical support to enhance the capacity of countries to deal with agricultural trade reforms • In 2012–2013, FAO elaborated five new Strategic Objectives (SOs) • Strategic Objective 4: Enable more inclusive and efficient agricultural and food systems at local, national and international levels • Agrarian Structures Initiative for Europe and Central Asia: • Supporting smallholders with improved enabling and legislative environment and lay the groundwork for further work to integrate smallholders into markets. • FAO’s five Strategic Objectives • SO1: Help eliminate hunger, food insecurity and malnutrition • SO2: Make agriculture more productive and sustainable • SO3: Reduce rural poverty • SO4: Enable inclusive and efficient agricultural and food systems • SO5: Protect livelihoods from disasters

16. Agrarian Structures Initiative for Europe and Central Asia (2013)

17. Formation of a group of livestock producers in Gorno-Badakhshan province, Tajikistan Context: • Extremely remote highland of the Pamirs Mountain chain, scarcely populated by semi-nomadic communities of Kyrgyz origin ; • Lack of pastures (land degradation + climate change); • Lack of technical training/knowledge on value addition and marketing => rudimental marketing (barter) and poor production management (poor control of risks); • AS A RESULT: poor farmer returns + danger of forced migration due to environmental degradation

18. Formation of a group of livestock producers in Gorno-Badakhshan province, Tajikistan • Need to reduce pressure on the (fragile) eco-system - “Less animals, better animals, take all from animals!” • Solution: link farmers to the existing (and growing!) premium meat market in the capital to increase their incomes and improve livelihoods. • How? By facilitating the formation of a livestock producers group and building its capacity to make their farming  profitable and environmentally sustainable. • Competitive value chain identified: prime-cuts of yak meat and yak milk cheese. Later also wool and down, skins, horns and hooves. • The goals: market-driven production system, guaranteed food safety, social inclusiveness and environmental sustainability.

19. Facilitating the understanding and adoption of WTO principles and commitments for agriculture in the CIS region • Joining WTO implies significant structural changes for the agriculture sector. But accession alone does not guarantee that the CIS countries will participate more effectively in global agricultural trade. • The governments will need to develop their institutional capacities to carry out the necessary reforms to comply with WTO commitments, and to adopt accompanying measures to allow the agri-food sector to take advantage of the opportunities that WTO membership provides.

20. Facilitating the understanding and adoption of WTO principles and commitments for agriculture in the CIS region Objectives: Contribute to formulation and implementation of policies to secure greater benefits from expanding agricultural trade by enhancing understanding by the stakeholders of the WTO commitments and their implications for agricultural development in the CIS countries The main outputs of the project are: • Country case studies (Azerbaijan, Kazakhstan, the Russian Federation and Tajikistan); • A regional workshop to identify and discuss the obligations and main challenges facing the agriculture sector as the result of WTO accession • Conducting an online courseon WTO rules and country-specific accession commitments for agriculture