• Urban issues

Urban issues

With the advent of supermarkets in urban centres in many developing countries, the question of their impact on access to food and food security for the urban poor has arisen. This paper examines the consequences, and also looks at the effect supermarkets can have rural agriculture and food security.

Supermarkets can provide better quality products to better-off consumers in developing countries, and thus contribute positively to their food security. With some food commodities, supermarkets are able to offer lower prices, improving access to food. This paper notes that, crucially, supermarkets don't appear to make a positive contribution to food security for poorer people in middle-income counties, or even middle-income groups in poorer countries.

For rural agricultural producers, high quality-requirements and global procurement systems mean that suppliers who can meet the quantity and quality requirements of supermarkets can benefit from these new retail channels. They also gain easier access to export markets. But again, this study and others point out that smaller and poorer producers, unable to meet these requirements, are usually marginalised and food security suffers. Furthermore, by reducing competition from other retail trading, there can be a significant loss of employment- and thus reduced food security- from the traditional sector.

The document finds that development and aid policies must address marginalised farmers, and seek out new ways for them to benefit from new opportunities opening up in the food trading system. The authors suggest this can be done by:

• financing the changes needed to comply with modern supply chain requirements
• building a supermarket corporate social responsibility that develops ties with small producers with a view of assisting in the transformation of their production and business practices
• organising small producers into viable cooperatives to deal with supermarkets
• legal and institutional improvements aimed at protecting both sides’ are required, particularly as contractual relations become more common
• competition policy actions that would prevent the abuse of market power and promote a competitive retail sector.

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