ADB warns no quick solution to high food prices

MANILA: The high prices of food worldwide are not likely to fall any time soon, and there are no quick solutions to the problem, the Asian Development Bank (ADB) warned yesterday.

"Scarcity is back, hunger is growing, and rapid economic growth is threatened. These are difficult times," the Manila-based lender said in the update of its annual Asian Development Outlook.

"In view of these difficulties, it seems unlikely that basic food prices will return to their real long-run downward trend." The regional lender did note that food prices were "substantially below the peaks of the previous world food crisis in 1973-74."

But it said this time, price increases had been "sharp and disruptive," affecting the poorest people and food-importing countries the most, increasing inflationary pressure and threatening economic growth.

Studies blamed the high prices on various causes including population growth, a slowdown in agricultural production, the depreciation of the US dollar, high oil prices and the increased demand for biofuels, the ADB said.

Short-term speculation had also fed the price increases, it said. The bank also said higher prices for some crops had led countries like India, Thailand and Vietnam to impose export controls while importing countries like the Philippines scrambled to find new stocks, further fuelling the crisis. AFP