Developed nations should stop paying agricultural subsidies to encourage biofuel production because the payments are making staple foods more expensive, the Asian Development Bank (ADB) said yesterday.
Biofuels should also be re-examined by governments around the world as it is increasingly unclear how environmentally friendly they are, said ADB managing director general Rajat Nag. The production of biofuel leads to forests being destroyed and reduced land area for growing crops for food, he said.
“We feel that the developed countries should seriously rethink the whole issue of biofuel, particularly the biofuel subsidies,” Nag said. “Giving subsidies for biofuels ... basically acts as an implicit tax on staple foods.”
Paying farmers to grow oilseed and other crops to produce biofuels means they grow fewer food crops, resulting in higher prices for such staples as palm oil and corn.
Nag did not give examples, but countries that subsidize biofuel include the US, the world’s largest producer of ethanol, which is made mostly from corn and other grain crops. The country’s farm subsidy programs include payments for ethanol production.
“We believe it is more important to let the developed country farmers decide on what they will plant, based on the relative prices, based on the international prices, but not subsidized prices,” he said.
Surging food prices, stoked by rising fuel costs that have increased production and transport costs, have triggered protests around the world in recent weeks. Riots have erupted over food shortages in the Caribbean and Africa and hunger is approaching crisis levels in parts of Asia.
Nag said rising food prices will be top on the agenda of the ADB’s annual board of governors meeting in Madrid next week.
He urged governments faced with rising food prices not to impose price caps or export bans, as the measures could prove counterproductive. Price controls are disincentives for farmers amid the rising costs, he said.
“The cost of production is going up, so the obvious, rational reaction [to price caps] of the farmer is to reduce planting, which is exactly the opposite of what we want. We want production to increase, not decrease,” he said.
Nag said governments should instead consider targeted cash income transfers to the poor. The bank was ready to provide loans to governments to help ease the situation, he said, but added that no country has made any specific requests yet.
“If the governments go for the targeted income support, obviously this will add to the fiscal burden of the governments, so ADB will be very responsive and willing to consider budget support for the government, and providing program loans,” he said.
In Asia, Nag said, the supply of rice to the region remained adequate even though stocks have slipped to their lowest in decades.
“We want to get the focus away from being dramatized or an overreaction to the supply situation. It is tight, no doubt about it,” he said. “But it is not a situation when rice is not available in the region as a whole.”
Nag said, however, that the rapid increase in the price of rice had a “very serious impact” on the region’s poor.
“The prices have increased very dramatically, almost three times in the last one year and almost twice in the last three months,” he said.
Nag said the hardest hit by rising food prices in the Asia Pacific region include 600 million people who survive on US$1 a day or less, and about the same number who live on just above a dollar — making up a group of about 1.2 billion who are vulnerable.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS