Aug
Starved For Solutions: How Microfinance Can Smooth Consumption In A Hungry World
Last year, while headlines read of a fallen Wall Street and a crumbling Main Street, people in developing economies worldwide were being slowly pushed deeper into poverty and starvation. “Food riots” ensued as the price of staples wheat and corn spiked at three times their average price between 2002 and2004. And for the tenth year in a row, the world dipped into its grain stockpiles as global food consumption outstripped production.
According to experts, the food crisis that culminated last year and persists today has no quick fix. That is due to a web of seemingly irrevocable factors, the largest of which are population growth and global climate change. At current growth rates, we can expect the world population to soar to eight billion by 2025. That, combined with the drying out of many geographies due to rising global temperatures and drought, means that we should be prepared for a state of serious and long-lasting food shortage.
The economic effects of food scarcity and higher commodity prices is particularly acute for the world’s poorest billion people, who typically spend anywhere from 50 to 70 percent of their income on food. Last year alone, an additional 75 million people slipped below the poverty threshold as a result of rising food prices. And while grain prices topped out in 2008 and have since fallen slightly, they remain higher than at any other point since 1990.