.Latin America and Caribbean 2012 Food Prices Nutrition and the Millennium Development Goals.IMF and World Bank Global Monitoring Report

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.Latin America and Caribbean 2012 Food Prices Nutrition and the Millennium Development Goals.IMF and World Bank Global Monitoring Report

.Latin America and Caribbean 2012 Food Prices Nutrition and the Millennium Development Goals.IMF and World Bank Global Monitoring Report

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  • 1. Global Monitoring Report 2012 Food prices, Nutrition, and the Millennium Development Goals (MDGs) Latin American and the Caribbean April 2012 Progress toward the MDGs Latin America and the Caribbean has already reached the targets on extreme poverty, primary completion, gender equality and access to safe water. The region is performing better than the rest of the developing world in relation to child mortality, having achieved more than 70% of the progress needed to reduce under-five mortality by two-thirds. However, Latin America and the Caribbean faces serious challenges regarding maternal mortality, as progress in this MDG has been significantly slow (figure 1). Progress toward halving the proportion of people who suffer from hunger is uneven in Latin America and the Caribbean. Approximately 70% of countries for which data are available are off track of achieving the development goal. For most of these countries, meaningful efforts must be undertaken, if the region is to reach the nutrition target by 2015 (figure 2). Figure 1. Global and regional performances 100% 90% 100% Figure 2. Progress toward reducing undernourishment Developing countries 100% Latin America and the Caribbean 100% Seriously off track 96% Off track On track Achieved 87% 82% 79% 76% 72% Low and Middle  Income 68 24 18 17 Latin America and  the Caribbean 80% 16 5 5 4 70% 5 1 0 2   60%   d r a w 50% o t   s s e r 40% g o r P 51% 52% 41% 38% 30% 20% 10% 0% MDG 7c.  MDG 7c.  MDG 1a. Extreme  MDG 2a. Primary  MDG 3a. Ratio of  MDG 4a.  MDG 4a.  MDG 5a. Maternal  Improved  poverty (% of  completion rate,  girls to boys in  Mortality rate,  Mortality rate,  mortality ratio  Improved water  (modeled  source (% of  sanitation  population below  total (% of  primary and  infant (per 1,000  under‐5 (per  estimate, per  population  facilities (% of  $1.25 a day in  relevant age  secondary  live births) 1,000) 100,000 live  without access) population  2005 PPP) group) education (%) births) without access) Note: a value of 100% means that respective MDG has been reached. Values denote present progress as illustrated by most recent available data: Extreme poverty—2010; Primary completion rate—2009; Ratio of girls to boys in primary and secondary—2009; Mortality rate, infant—2010; Mortality rate, under 5—2010; Maternal mortality ratio—2008; Improved water source—2010; Improved sanitation facilities—2008. Source: World Bank staff calculations based on data from the World Development Indicators database. 0% 20% 40% 60% 80% 100% Percent of countries Note: Chart depicts the ratio of absolute regional improvement to global improvement by MDG. Improvement is measured as the difference between latest available value (see note figure 1) and starting value circa 1990. Food price spikes and nutrition Large resource endowments and the lower share of household expenditures devoted to food, at least compared to Asia and Africa, make the region as a whole less vulnerable to volatile international food prices. However, agricultural production has been affected by natural disasters. For example, the January 2011 cold wave in Mexico damaged 1.5 million hectares (or 4 million metric tons) of white corn and over 80 percent of green vegetable crops for export. And, vulnerability differs significantly among countries. El Salvador, Grenada, Haiti, Suriname and St. Vincent and the Grenadines are particularly vulnerable because of high fiscal deficits, large cereal imports, and low-quality social protection programs, while Argentina, Brazil, and Uruguay are agricultural powerhouses that benefit from higher international food prices. As a relatively urbanized region, a large majority of its population, including in netexporting countries, are consumers who lose from the direct effects of price spikes and significant pass-through of international to domestic prices. Several countries in Latin America and the Caribbean face the double burden of malnutrition and chronic disease. This is particularly the case in Central America, where health indicators show an increase in overweight and obesity among adults who were previously undernourished, as well as high numbers of chronically undernourished children. In times of high food prices, the double burden increases and obesity and undernutrition may coexist within the same household and the same person. In this context, poor families switch away from nutritious food and buy “empty calories,” as is the case in Honduras and Guatemala. The World Bank Group 1818 H Street, NW, Washington DC 20433 Email: gmr@worldbank.org www.worldbank.org/gmr2012
  • 2. Global Monitoring Report 2012 Food prices, Nutrition, and the Millennium Development Goals (MDGs) Latin American and the Caribbean Policy responses April 2012 Figure 3. Net ODA disbursements to developing regions (US $ million, 2009 prices) The chosen policy mix at the country level depends critically on how much of a country’s food needs to be imported, how much the poor spend on food, and the socio-economic characteristics of the poor affected. The policy mix also depends on a country’s integration with regional and world markets, its level of productivity compared to what is achievable, and on its government’s capacity to target the poor and vulnerable through mitigating interventions. In addition, much is contingent on a county’s initial macroeconomic condition and thus its ability to expand public expenditure programs or to provide tax incentives without jeopardizing fiscal sustainability. In terms of policy responses, short-term measures should aim at mitigating the immediate adverse impact on the poor and vulnerable. Social safety net programs play a vital role in coping with food price shocks in many developing regions. In Latin America, conditional cash transfers have shown significant results on nutritional outcomes. Recent research points to the positive impacts on children’s height of programs such as Progresa/ Oportunidades in Mexico and Familias en Acción in Colombia. In the case of Nicaragua, World Bank research provides evidence on the nutritional and early childhood development impacts of a conditional cash transfer pilot, Atencion a Crisis, designed to address crises, such as droughts, cyclones, and extreme poverty. In this program payments were conditional on school attendance for school-aged children and on preventive care visits for preschool children. The pilot led to significant gains for a variety of cognitive and noncognitive skills (social and personal measures and vocabulary). 250,000 1991‐2000 2001‐2010 200,000 150,000 100,000 50,000 0 East Asia &  Pacific Europe &  Central  Asia Latin America &   Caribbean Middle East &   North Africa Regional ODA flows have remained roughly stable in Latin America and the Caribbean in real terms. Colombia saw the largest percentage rise in disbursements, from $2.1 billion in the 1990s to $7.8 billion, in the last decade (a real 262 percent increase) (figure 3). Despite the spike in food prices, ODA commitments from all donors to agriculture, food, and nutrition decreased as a share of total ODA between 2000 (13 percent) and 2010 (10 percent). Aid commitments to Latin America and the Caribbean from DAC bilateral ODA and multilateral developmental assistance to agriculture, food, and nutrition increased from $1.1 billion in constant terms in 2000 to near $1.3 billion in 2010. Assistance for nutrition represents only 3 percent of total agriculture, food, and nutrition commitments, despite widespread evidence that improved nutrition and gains in Sub‐Saharan Africa Source: World Bank staff calculations based on data from OECD. Figure 4. Composition of committed ODA to Latin American and the Caribbean in year 2010 (constant 2009 million $) Basic nutrition 3% Emergency f ood aid  19% Long-term measures should seek to address demand and supply side imbalances at the regional and local levels. Some of the challenges the region has to overcome include inequality in land ownership, which often leads to land underuse and deep-rooted rural poverty, and inefficient transport and high logistic costs. Support from international development partners South Asia Rural development  13% T otal  commitments  (excluding food,  nutrition and  agriculture) 11,723  Food aid/Food  security programmes  7% Food, nutrition and  agriculture 1,285  Agriculture and Agro‐ industries 58% Source: World Bank staff calculations based on data from OECD. early childhood development are key in making long-term progress in development (Figure 4). Looking ahead, Latin America and the Caribbean is on track to post the largest real decline in country programmable aid (CPA) through 2013 of close to 7.9 percent a year on average. Aid disbursements are expected to decline in nearly 80 percent of partner countries, with 40 percent of these linked to phase-out decisions. On a per capita basis, that translates into a 9.8 percent average annual decline in planned disbursements for the region. The World Bank Group 1818 H Street, NW, Washington DC 20433 Email: gmr@worldbank.org www.worldbank.org/gmr2012