
The PSDBlog of the World Bank has touched the subject of biofuels (which I blogged on last week). They quote a very interesting article regarding world poverty and the increase in food prices in the world.
"What do Kellogg's, Fidel Castro and Hugo Chávez all have in common? All three blame biofuels for pushing up food prices. The new issue of Newsweek breaks down components of the recent price hike."
Ethan Zuckerman, author of My Heart's in Accra, also has an interesting view on the increase of food prices, specifically the cost of maize. It isn't really related to the biofuel debate, but plays more as an economic - free market view. "White maize is selling for $0.32 a kilo in Ghana today, and for $0.22 across the border in Burkina Faso, a disparity that might be explained by Ghana's comparative wealth and spending power. But if you're looking to engage in agricultural arbitrage, you might want to go long in onions, which are selling for $0.31 a kilo in Benin and $0.91 a kilo in Ghana. Of course, before you load that lorry, you should probably do some research. One of the reasons that commodity prices are so varied in the region is that regional trade is tough to accomplish - the infrastructure connecting Ghana and Benin isn't great, so transport costs are high, and the process of crossing borders between Ghana/Togo and Togo/Benin is likely to involve tariffs, shrinkage of your crops and a number of other unanticipated costs." While food prices might trend up because of the new biofuel demand, staple food prices also increase because of difficulties in regional trade, such as the lack of infrastructure or even because of high tariffs between countries, thus affecting people in the BOP. So don't go blaming everything on biofuels just yet…
Changing gears, Pablo Halkyard blogged at iPienso last week on the WHO's free, insecticide-treated bednet initiative in Africa to fight malaria. Jaqueline Novogratz from Acumen Fund also wrote a blog entry on this subject, analyzing the situation and how this subject intertwines with theories of providing "cheap products" versus "free products." There is always more than one approach, and this does not always necessarily mean that one has to trump the other.
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