an Eldis Resource
Global financial and food crisis: a Malysian perspective
Interplay and linkages in the relevance of Malaysia’s strategic approach to food security
Authors:
L.C.Y. Wong
Publisher:
Institute of Strategic and International Studies, Malaysia, 2009
High food prices from 2007 through mid-2008 spawned serious implications for food security, macroeconomic stability and even political stability in many countries, especially developing ones. Subsequently, the unfolding global financial crisis and economic slowdown have inadvertently pushed food prices down by about 40%, but setting at higher than pre crisis levels, perhaps marking the end of cheap food era. At same time, the financial crunch has also dampened the availability of capital at a time when accelerated investment in agriculture is needed. This paper explores the interrelatedness of the unfolding financial and food crises and some of accompanying policy challenges as well as impact on and increasing relevance of agriculture. It hones in on food security issues and various new dimension in relation to the future of food from Malaysian’s perspective.
Agriculture growth is crucial element in resolving food prices, enhancing food security and accelerating pro-poor growth. However, the variability of food prices often poses a problem to medium and long-term planning. Banks cut lending because of the financial crisis, broader plans for investment in agriculture on a sectoral basis or along entire supply chains are also at risk of being scaled back. It would be prudent to retrace the major drivers for the renewed interest in agriculture around the turn of the century as well as consider how an elected net food importer like Malaysia addresses food security. As far as Malaysia is concerned, the country has adopted a pragmatic strategic approach linking food security (mainly focused on rice which is basic staple and political crop) and economic growth (growth with redistribution at both macro and micro level).
There are well founded reasons to be guardedly optimistic of Malaysia’s and Asia’s prospects and ability to not only weather the storm but also harness and exploit the various opportunities accompanying the current financial and food crises. However, the increasing need to get the balance right is underscored. The dynamic interplay between agri-food supply systems and agri-biotechnology and evolving innovative work and ideas can and should be harnessed to generate wealth, income and stability and hence ensure food security at local, national, regional and global levels.
A key challenge is to continuously address the fundamentals of population growth, the nutrition transition, energy, land, water, labour, and climate change as well as emerging trends, new ideas and innovations. Another challenge is to mount multidisciplinary empirical studies to better understand the interplay and impacts and guide policy so that future development and progress can be more balanced and sustainable.
