by Daniel Korski | Jun 21, 2008 | Europe and Central Asia
I’m back in Belgrade after seven years. Last time I was here, Milosevic had recently been overthrown and sent to the War Crimes Tribunal in The Hague; Vojislav Kostunica had been elected President and the future looked bright.
Today, Kostunica is the international community’s bete noir, Milosevic is dead but his party, the Socialists, are likely to enter into a coalition government with the EU’s favourite, President Boris Tadic. The country seems locked in a struggle with the EU over Kosovo’s fate. And judging from my unscientific, coffee-fuelled poll of people I have met today, things are a lot worse now than they were seven years ago.
In Belgrade, newly-built, mirrored office buildings vie for space with clapped-out, Yugoslav houses. Down the main drag, dolled-up, silicone-enhanced peroxide blondes leap over dirty beggars. The sun shines, and the city’s second sushi bar – this one run by a Swede – tempts punters with the symbol of Western style – posh Eastern food.
But Belgrade seems like an old lady; once beautiful and coveted, she’s now bitter and tired. Occasionally, she reveals her former glory – in a beautiful, Austro-Hungarian building, a majestic street, a concert in the park – but her time seems over. And after only one day of being here, I’m not sure the Serbs are ready yet to give her a new lease of life.
by Alex Evans | Jun 20, 2008 | Climate and resource scarcity, Global system, North America
If there’s a silver lining to the disastrous flooding in the US mid-west, then this might be it. As prices for corn go through the roof, the impacts of diverting so much of it to ethanol production – expectations before the flooding were of fully a third of this year’s crop – are leading to an increasingly determined push-back from the US food industry.
Of course, the effects of corn-based ethanol on food prices aren’t exactly a newsflash: Mexico City saw riots on this very subject back in February 2007, well before food prices had reached the top of the global agenda. But the extreme weather event that the US midwest is now experiencing shifts the intensity of debates up by at least two gears.
At present, the FT reports, US biofuel rules require 9 billion gallons of biofuels to be blended into transport fuels this year – mostly with corn-based ethanol. But the US Environmental Protection Agency can – if it chooses – waive the requirement. Texas has asked it to do just that – and food producers, as they watch their costs rocket – are asking it to do the same nationally. As one food company chief puts it, “it is not fair to expect us to compete with a government-subsidised market”. It’s a fair point.
As readers will already be aware, the importance of corn to the US food economy goes far, far beyond cornflakes and tins of Green Giant sweetcorn. If you haven’t already done so, read Tim Flannery’s excellent NYRB article from last summer entitled “We’re living on corn!” – he’s not kidding:
[Michael] Pollan gives us the example of the chicken nugget, which he says “piles corn upon corn: what chicken it contains consists of corn” (because the chickens are corn-fed), as does “the modified corn starch that glues the thing together, the corn flour in the batter that coats it, and the corn oil in which it gets fried. Much less obviously, the leavenings and lecithin, the mono-, di-, and triglycerides, the attractive golden coloring, and even the citric acid that keeps the nugget ‘fresh’ can all be derived from corn.
So dominant has this giant grass become that of the 45,000-odd items in American supermarkets, more than one quarter contain corn. Disposable diapers, trash bags, toothpaste, charcoal briquettes, matches, batteries, and even the shine on the covers of magazines all contain corn. In America, all meat is also ultimately corn: chickens, turkeys, pigs, and even cows (which would be far healthier and happier eating grass) are forced into eating corn, as are, increasingly, carnivores such as salmon.
If you doubt the ubiquity of corn you can take a chemical test. It turns out that corn has a peculiar carbon structure which can be traced in everything that consumes it. Compare a hair sample from an American and a tortilla-eating Mexican and you’ll discover that the American contains a far larger proportion of corn-type carbon. “We North Americans look like corn chips with legs,” says one of the researchers who conducts such tests.
And of course, turning food into fuel is only half the story: for America’s love affair with corn is also the tale of turning fuel into food – on a truly epic scale. In the US, according to academics David Pimentel and Mario Giampietro, even back in 1994 the equivalent of 400 gallons of oil was expended each year to feed each US citizen. Meanwhile, another study – this time of Canadian farms – gives an idea of how this energy use breaks down:
– 31%: manufacture of inorganic fertiliser
– 19%: operating field machinery
– 16%: transportation
– 13%: irrigation
– 8%: raising livestock (not including feed)
– 5%: crop drying
– 5%: pesticide production
Now, you may be wondering: if it takes this much energy to produce corn, how can it make sense then to use that corn as an energy source? Wouldn’t that seem, not to put too fine a point on it, wantonly defiant of the laws of thermodynamics? Alas, it would. Indeed, studies show that the energy-returned-on-energy-invested (EROEI) of corn is actually negative: corn ethanol requires 29 per cent more energy to grow than what you can get out of it.
Rewind! One more time: corn ethanol requires 29 per cent more energy to grow than what you can get out of it. You may have seen some pretty mad subsidies in your time, but I’ll wager that none tops this; watching America tie itself in knots thus, one can’t help but feel an awestruck respect for the thunderous public affairs capacity of the US farm lobby.
Still, as we watch the US farm lobby and the US food lobby start to join battle, one might reflect that neither is clearly doing many favours for the public interest. Corn-based ethanol may be an obviously stupid policy. But it’s hard to see a diet as rich in red meat, saturated fat and processed food (all derived from corn) as is America’s, as being much more sensible – especially given that the globalisation of that diet is the number one driver of rising global food prices.
by Alex Evans | Jun 19, 2008 | Africa, Climate and resource scarcity, Cooperation and coherence, East Asia and Pacific, Economics and development, Global system
Not much respite in prospect on food export restrictions, if today’s FT is anything to go by. Vietnam, the world’s second largest exporter of rice, has imposed a minimum price of $800 a tonne on rice exports (the price last year was $300 – ouch). Meanwhile, Argentina has just passed a tariff bill which “is not likely to lead to an immediate resumption of grain exports in the world’s third-biggest soy producer, sixth-biggest wheat producer and second-biggest corn exporter, analysts say”.
These problems underline a bigger challenge lurking in the background: that while the world may have a rules-based global trading system built around the WTO, that system is built for totally different trading conditions to the ones that obtain today.
In essence, the WTO and its dispute resolution architecture are designed to help countries to work through squabbles about market access and dumping – the sort of scuffles you expect in a buyer’s market. Fine – except that today, we’re in a seller’s market, on food and energy alike, where the concerns that are really furrowing brows are over security of supply, not market access.
And as a range of current examples show, the one thing policymakers can’t do is just sit back and ‘leave it to the market’. On energy, there’s already increasing friction over strategic oil supplies in Africa, the Arabian Gulf and the South China Sea. On food, meanwhile, export restrictions have left many countries in serious difficulties – like the Philippines, which is trying to go self-sufficient in rice within three years (from being the world’s no. 1 importer today – good luck). Meanwhile, China, Saudi Arabia and other importers are engaged in a quiet but determined hunt for land to buy in third countries.
Over the long term, these pressures may increase dramatically. Demand for energy and food is forecast to grow by 50 per cent each by 2030, according to the IEA and the World Bank respectively. If supply growth fails to keep pace – as seems entirely possible, especially given that food and energy prices are increasingly interlinked (through fuel costs, fertiliser costs, and the arbitrage relationship created by biofuels) – then situations like these will in retrospect seem like no more than trailers for the main feature.
In that context, it would be helpful if our rules-based trading system had something – anything – to say on the subject of security of supply. Do major exporters of key strategic resources have responsibilities as well as rights in the international system? Or is it no more than the legitimate exercise of sovereignty if they suspend or restrict exports at a moment’s notice?
Big questions – but not ones that are the subject of searching debate among trade negotiators. Like Britain’s artillery guns in Singapore during World War Two, the world trade system’s defences are pointing the wrong way.
by Alex Evans | Jun 17, 2008 | Climate and resource scarcity, Cooperation and coherence, Global system, Influence and networks
PIPA’s latest global opinion poll is a bit of a downer on world leaders: it finds that in 20 nations around the world, “none of the national leaders on the world stage inspire wide confidence”. Still, while it’s obviously a source of some amusement that more publics trust Ahmadinejad than Bush, the real story for me here is that
Only UN Secretary General Ban Ki-moon received largely positive ratings in a worldwide poll that asked respondents whether they trusted international leaders “to do the right thing regarding world affairs.”
It just goes to prove the point about the nature of the ‘global interregnum’ in which we find ourselves. As David and I observed in our memo to Gordon Brown on fixing the UK’s foreign policy (over a year ago now), the leadership of an awfully big range of countries and institutions changes hands between mid-06 and the end of 08; in such a context, it’s easy for leaders to emerge rapidly to the forefront of global statesmanship.
And for all that UN watchers sometimes carp, Ban Ki-moon has actually been terrific in starting to set out a joined-up narrative on scarcity issues (a point also now spotted by The Economist). He deserves real personal credit for driving the UN’s food prices agenda, including setting up its High Level Task Force; he’s been emphatic about the importance of getting to grips with water scarcity; and on climate change (his stated number one priority), he teed up the Bali outcome with his High Level Event in September last year, and then used his personal authority to drive the deal through later in the year. Go Ban.
by Richard Gowan | Jun 17, 2008 | Africa, Climate and resource scarcity, Conflict and security, Europe and Central Asia, Global system, Influence and networks, UK
Yesterday I recorded that Chadian rebels had congratulated Irish EU troops on their “courageous” and “neutral” (i.e. defensive) response to a firefight in the east of the country. But not everyone in Chad is quite so happy with their performance. The rebels are pushing ahead with a big offensive against the government, and President Idriss Deby is getting edgy. According to the BBC, he’s decided to blame the EU Force (Eufor):
In a televised address, President Deby accused Eufor of failing to prevent the killings of civilians and refugees by the rebels. “We’ve been surprised to see that, in its first hostile test, this force has rather cooperated with the invaders, allowing humanitarian workers’ vehicles to be stolen and their food and fuel stocks burned and closing its eyes before the systematic massacre of civilians and refugees,” he said. “We have the right to ask ourselves about the effectiveness of such a force, of the usefulness of its presence in Chad.”
Now this is a tough one. Although Eufor’s primary task is to provide security for UN police and humanitarian workers in the refugee camps on Chad’s border with Darfur, it is also meant “to contribute to protecting civilians in danger, particularly refugees and displaced persons”.
This is actually pretty standard stuff. Virtually all UN peacekeepers have similar “protection of civilians” clauses in their mandates, part of a broader trend towards “robust peacekeeping” explored in this 2006 article by Ian Johnstone (who did all the hard thinking), Ben Tortolani and me. The EU’s just catching up.
But what happens when, as now in Chad, protecting civilians would mean taking sides in a civil war? That’s definitely not in Eufor’s mandate, but it has been a lurking problem ever since the mission started to deploy in February.
As I noted back then, the French (who, I need hardly remind you, provide most of the troops and political impetus for this mission) were somewhat ambiguous on this point. In Paris, the foreign minister underlined that Eufor was neutral, but that it would complicate the Chadian rebels’ plans by limiting their freedom of movement through its presence on the ground… but now the rebels seem to be toddling around unobstructed, and Mr Deby may feel he deserves a refund.
