CGD in the News

Neither Is the State [Newsweek]

December 19, 2005

This article is from the Dec. 26, 2005 - Jan 2, 2006 issue of Newsweek Magazine. The author, Rana Foroohar, quotes Senior Fellow Peter Timmer in this piece about governmental level reforms that would benefit development.

From the article:

While the protectionist politics of agriculture in the United States and Europe is holding up further progress on the Doha round, it's worth remembering that 70 percent of tariffs paid by developing countries are paid to other developing countries. Asian countries for example, could begin helping their poor by lowering regional tariffs on key products such as rice. This isn't easy because in most countries, agriculture is a highly sensitive issue. But the consequences of the trade status quo are high, because when rice prices go up, so does poverty. In Indonesia, for example, growth has been lagging for years in part because of an absolute ban on foreign rice. "Indonesia should use cheaper rice from Vietnam, Thailand or India to fuel diversification into higher-end products like meat and poultry," says Peter Timmer, a senior fellow at the Center for Global Development in Washington, D.C. Instead, the government continues to subsidize its own less productive growers. The reason is no surprise. Rice farmers are the largest identifiable voting bloc in the country.

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