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Last Friday, I had the pleasure of co-chairing, with research fellow Ben Leo, a CGD event on the priorities and prospects of the G-20’s recently adopted development agenda. The two panels focused on African infrastructure and global food security, the central pillars of France’s development agenda for the upcoming G-20 Summit in Cannes. It’s encouraging to see the G-20 taking up these issues, especially after it responded relatively effectively to the global economic crisis in 2009, but we’ll have to wait and see whether it can be effective over the longer run in coordinating policies to produce global outcomes better than what countries acting alone can produce.
The event began with opening remarks from the French Minister for Cooperation and Development, Henri de Raincourt, and closed with Undersecretary of the Treasury for International Affairs, Lael Brainard. In between, Ben chaired the panel on African infrastructure with Remy Rioux, France’s representative on the G-20 development working group, Elizabeth Littlefield, president of the U.S. Overseas Private Investment Corporation, and Bobby Pittman, vice president for Infrastructure, Private Sector, and Regional Integration at the African Development Bank. I then chaired the panel on food security with Sujiro Seam, who represents France as co-facilitator on food security in the G-20, and Will Martin, a well-known expert on agricultural trade policy from the World Bank.
Minister de Raincourt emphasized the interdependency of the global economy in discussing the inclusion of development issues on the G-20 agenda, but contended that the G-20 is not a substitute for other multilateral organizations. He outlined France’s development priorities—the focus of the event’s two panels—and his goals for the G-20 to foster infrastructure projects and develop tools to counter the volatility of global agricultural prices.
Much of the conversation in the first panel focused on the opportunities for investments in the renewable energy sector in Africa. Although sub-Saharan African economies grew by an average of nearly 5 percent annually over the last decade, nearly every African country faces serious challenges in providing a steady, reliable supply of electricity. To maintain and even accelerate growth and economic opportunities going forward, countries must address the binding constraints posed by the region’s lack of infrastructure. Pittman pointed to inadequate information as a general obstacle to exploiting profitable opportunities and called for a sort of virtual marketplace where African entrepreneurs and potential investors could find one another.
Participants on the second panel similarly identified better information as a critical need for improving food security. Uncertainty about production, consumption, and grain stocks in key countries can encourage speculation and, in the worst cases, panic that exacerbates price spikes. A system for building data-gathering capacity, and improving monitoring and reporting on the global food situation is likely to be one outcome of the G-20 development working group discussions this year. Martin also discussed his research showing that trade measures in response to food price spikes are not only inefficient but ineffective, and both Minister de Raincourt and Seam mentioned disciplines on the use of export restrictions as another likely outcome of the G-20 process. In response to a question about the G-20’s role in helping countries build or strengthen safety nets to address food security, Seam drew a sharp distinction between the G-8 and the G-20, saying that the latter is not a donor group and no one should expect pledges of new pots of money.
Lael Brainard closed the event by detailing U.S. efforts to address the infrastructure and food security needs of its African partners. She emphasized the administration’s commitment to working with the G-20 to ensure more early stage investment for African infrastructure projects and to collaborating with the East African Community, a partnership that may produce a model for future efforts to address regional development challenges. Brainard also highlighted the U.S. commitment, along with other partners, to the Global Agricultural and Food Security Program, a new multilateral trust fund managed by the World Bank designed to coordinate donor funds and respond quickly and flexibly to country-designed proposals for food security projects. Despite the pressures in Congress to cut the aid budget, the administration was able to secure $100 million for the rest of this year for the fund.
As donors gather next week in Rome to pledge funds to the International Fund for Agriculture Development , they may be wondering where the United States is. Given the generally high marks this independent fund earns for development effectiveness, the uncertainty around a US pledge is troubling. In this “America First” moment, it’s worth asking when it comes to IFAD, what’s in it for the United States and what will be lost if the United States drops out?
Members of the World Trade Organization will be meeting next week in Buenos Aires to discuss the future of agricultural and other trade policies that could have important implications for food security and jobs in developing countries (eventually). And members of the US House and Senate agricultural committees will be meeting through next year to craft a new five-year farm bill that will help shape global markets and determine how much and how quickly US food aid can be delivered to people in desperate need around the world.
With a decade since the beginning of the major food price spike in 2007, Ministers gathering at the WTO Ministerial in Buenos Aires this week can make a positive impact on people's lives—with an agreement that will reduce the likelihood and impacts of a food price spike.