The Free Flow of Goods and Food Security and Nutrition
Will Martin and David Laborde
- Trade can contribute to the four key requirements of food security—food availability, access, utilization, and stability of supply.
- By encouraging production in areas with a comparative advantage in agriculture, trade raises countries’ incomes and provides access to better prices on the world market.
- Limiting trade would result in high prices in land-scarce countries, depressed food prices in land-abundant countries, and lower real incomes in both.
- Trade in inputs, commodities, and ideas can boost agricultural productivity and increase sustainability by facilitating diffusion of technology and spurring innovation.
- The institutional framework for international trade has helped countries take advantage of opportunities for food exports and imports.
- Nutrition can be improved by open trade, which can provide better access to a diversified food basket, including greater diversity of products and suppliers and reduced volatility of supply.
- Real risks associated with trade opening include increases in inequality, negative impacts on health, increased energy use, and environmental damage.
- Support trade opening with active policies and strong institutions to guarantee cooperative behavior
- Design policies to address challenges or externalities associated with trade using the assignment principle—targeting the policy to the immediate source of the problem.
- Address inequality and price volatility with safety nets and investment in human capital. Smart policy solutions will protect consumers and producers with direct support.
- Address environmental impacts with resource management policies. Overexploitation of resources or loss of biodiversity are best managed by mainstreaming good management into production, rather than limiting trade.
- Address overnutrition with education and other policies directly targeting consumption. These are more effective than banning or limiting trade in calorie-dense foods.