Hunger Costs Poor Countries $450 Billion A Year Says ActionAid

SEPT 14 2010

Washington, D.C., September 13, 2010 - A new report by ActionAid reveals that hunger could be costing poor nations $450 billion a year – more than ten times the amount of aid needed to halve hunger by 2015 in order to meet Millennium Development Goal One (MDG 1). ActionAid’s report scores donor and developing nations on their efforts to fight hunger and is released as world leaders prepare to meet next week at the UN in New York to discuss progress on the Millennium Development Goals.

“This report makes clear that fighting hunger is ten times cheaper than ignoring it,” said Peter O’Driscoll, Executive Director of ActionAid USA. “Recent food riots are a reminder that poor countries cannot rely on unstable global food markets. Investing in women smallholder farmers in countries facing hunger is the best way to avert another food crisis.”

ActionAid’s report reveals that 20 out of the 28 poor nations we reviewed are off track to halving hunger by 2015. Twelve of these are going backwards, despite UN claims that the world is on track to meeting MDG 1. ActionAid says progress towards meeting the hunger goal is elusive largely because of inadequate aid to agriculture and rural development, lack of enforcement of the legal right to food in poor nations, and insufficient support services to help farming communities when harvests fail.

The report finds that the US has emerged in 2009 and 2010 as a global leader on issues of hunger and food security, following through on President Obama’s 2009 pledge at the G-8 summit in L’Aquila, Italy to provide $3.5 billion over three years for food security. In May 2010, the Obama administration unveiled a detailed new strategy on global food security, the Feed the Future Program. This bilateral funding initiative provides the strategic guidance and implementation plan for two-thirds of the US’ $3.5 billion commitment. The remaining one-third of the US pledge is dedicated to the Global Agriculture and Food Security Program (GAFSP).

The Feed the Future program represents a dramatic shift in US policy towards agricultural development. It aims to support country plans and includes a strong focus on policies to reach smallholder farmers, stressing the importance of supporting women farmers.

“President Obama has made food security a central focus of his development agenda,” said O’Driscoll. “The US is rightly focusing on support for smallholder farmers and agricultural development, the only sustainable solution to food shortages. The President should continue to use his influence to focus other leaders on this critical problem.”

Aside from aid to agriculture, the report also analyzes other factors that contribute to hunger, including climate change and increasing production of biofuels on land previously used to grow food. In these areas, the report card finds that the US needs to show much stronger leadership to match the ambition of its commitments to agricultural aid.

The report finds that Brazil, China, Ghana, Malawi and Vietnam have cut hunger by dramatically scaling up investment in small farms, and by introducing social protection measures like public works employment, cash transfers, food rations and free school meals. Malawi has reduced the number of people living on food hand outs from 1.5 million to 150,000 in just five years. Brazil has halved the number of underweight children in less than 10 years. China will meet its hunger goal five years early.

“Malawi and Ghana are shining examples of how supporting small scale farmers is the key to halving hunger,” said ActionAid’s Africa Hunger Free Coordinator Henry Malumo. “With only five years left and a billion people hungry, it’s critical that the world follow their example.”

For more information, interviews, photos and case studies contact:

Download a copy of the report here.

ActionAid will be at the MDG summit 20 – 22 September 2010 and available for interview in every region of the globe.

Notes to Editors:

What does the report do?

This HungerFREE Scorecard aims to evaluate countries on progress in fulfilling their commitments to end global hunger. Twenty eight developing countries and 23 rich nations, which are members of the OECD’s Development Assistance Committee are analysed in the report.The indicators are based on the actions that the UN has identified as most critical to reverse growing global hunger.

Developing countries have been graded on their performance on hunger and child nutrition and on three areas of public action: legal commitment to food as a right, investment in agriculture and social protection. Developed countries have been ranked on two sets of indicators: 1) On their aid to agriculture and aid to social protection measures (their ‘aid indicators’). 2) The extent to which their domestic policies (their ‘policy’ indicator) contribute to current and future hunger in developing countries, especially through incentives for biofuels use and carbon emissions.

The first section of the report synthesises the data from the indicators and the country by country progress, to summarise key policy lessons and hunger trends. The second section, HungerFREE Country Scorecards, takes a closer look at each country with at-a-glance information. The final section outlines the methodology and data indicators in greater detail.

How has ActionAid calculated $450 billion?

A recent UN and World Food Programme cross country analysis of the economic impact of child malnutrition in Central America, determined that the opportunity cost of child malnourishment amounted to between 2% - 12% of GDP annually. Ninety per cent of this impact was loss of productivity due to early deaths and lower education levels caused by hunger. A further ten percent came from the cost of treating hunger-related diseases and from more children repeating school grades.

Projecting the lower end of this loss only for the regions with highest child hunger levels (sub-Saharan Africa and developing Asia), a conservative 3.5% reduction in GDP due to child malnutrition could cost these regions as much as $462 billion a year. Rounded down, this is approximately $450 billion.

Who is ActionAid?

ActionAid is a leading aid agency in the fight against hunger. It works with farmers in 30 countries and has spearheaded a global campaign aimed at ensuring governments deliver on the first Millennium Development Goal: to halve extreme poverty and hunger by 2015. The ActionAid HungerFREE campaign aims to put the issue of hunger to the top of the political agenda. For more information on HungerFREE go to: www.hungerfreeplanet.org

What is Millennium Development Goal One?

Target 1c: Reduce by half the proportion of people who suffer from hunger 1.8 Prevalence of underweight children under-five years of age 1.9 Proportion of population below minimum level of dietary energy consumption