The Politics of Poverty

Ideas and analysis from Oxfam America's policy experts

Teetering on the edge

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Food prices are just one of many factors contributing to the situation in Egypt, but they have helped provide a spark for recent unrest across the region. It is exactly this mix of poverty and injustice that puts global stability at risk.

Woman carrying maize stalks in Egypt. Photo by Karen Robinson/Oxfam
Woman carrying maize stalks in Egypt. Photo by Karen Robinson/Oxfam
When the UN Food and Agriculture Organization announced January 5th of this year that food prices had reached an all time high, my colleague Gawain Kripke warned that, “the record rise in food prices is a grave reminder that until we act on the underlying causes of hunger and climate change, we will find ourselves perpetually on the knife’s edge of disaster.” A year of extreme weather, along with other short and long-term factors, had shocked our food system, disrupting supply chains and sending the price of many food items through the roof.

Just days later rioters in Algeria were heard chanting, “Give us sugar!” as they kicked off a new wave of sometimes violent protests that have shaken the tenuous foundation of stability across North Africa and the Middle East. Gawain’s warning, it seems, had proven prophetic sooner than most might have expected.

As the situation in Egypt has become increasingly tense, the Obama administration has faced questions about how unrest will impact the US aid regime in Egypt and elsewhere. Some are already talking tough about wholesale cuts to aid. But in deciding how the strategic priorities for US security and diplomacy should shift in the aftermath of these events, it’s important to remember just how we got into this mess.

According to the UN, over 42 percent of Egyptians live below the poverty line. Reports from the region show that increasing unemployment, sharply rising prices, deteriorating economic conditions and a growing gulf between rich and poor are fuelling the demonstrations. Egypt, the second-biggest wheat importer in the world, is particularly vulnerable to disturbances in the global food system importing 40 percent of its foodstuffs and 60 percent of its wheat. In 2008, Egypt spent $2.4 billion importing wheat, which is the staple cereal.

Thankfully Egypt has not faced the drastically high rates of malnutrition other countries have suffered, but only through heavy government intervention (something between 3 and 14 percent of government expenditure). For that we can be grateful, but this course may not be sustainable, and it certainly does not seem to be satisfactory to the Egyptian people who have complained about price increases.

While food prices may have helped provided a spark for recent unrest across the region, most evidence suggests that prices are just one of many factors contributing to the situation in Egypt. But it is exactly this mix of poverty and injustice that puts global stability at risk. In finding ways to prevent further instability from threatening US interests and security around the world, our focus should be on building solutions not cutting and running. We can’t shy away from the fight against poverty to protect the vulnerable and our own security.

The question of precisely how aid should flow to Egypt is surely too complicated for a 500-word blog post. But in addressing the structural problems, which lead to food insecurity more broadly, there are concrete policy prescriptions at our disposal. Some of them involve cuts, others require investment. Policies that help prevent severe food price shocks, enable smallholder farmers to build resilience to increasingly extreme weather caused by climate change and empower poor people in vulnerable countries with economic opportunity are a good place to start.

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