Escalating food prices: Are they good for the economy?

2 replies [Last post]
Esther Nakkazi's picture
Joined: 06/04/2008

Recently the rise in food prices nationwide has been interpreted as a good economic indicator for the country. Some people have argued that farmers will at last make some good money from their sweat. Others think the economy is headed for troubled times with fewer people able to afford two meals a day. Ultimately this will lead to increased poverty.
What is your take on this?

Patrick Luganda's picture
Joined: 06/04/2008
The Higher Prices Good But.....

While the news of higher prices are potentially good for the East African economies. the gains are not automatic and the governments, individuals and the whole regional community need concerted efforts to take advantage of the higher prices. Already middle men are cashing in on quick returns from trading food from surplus areas like Uganda to the neighbouring countries. However the local peasant farmers are not gaining as yet because they do not have the adequate capital investments to gain from the windfall. What is required are well calculated measures to make immediate investment plans so as to benefit in the medium and long term. For instance many countries in Africa are hardly using fertilisers (be they organic or inoprganic) to increase yields per unit area cultivated. Neither are they using improved seeds widely. Interventions by governments could include dissemination of modern technologies to the grassroots and addressing marketing constraints among others. A move to revolutionalize agriculture could also involve focussing on agro industries in order to add value to the agricultural production chain. In the meantine, there are over 12 million people in the East African region at the risk of severe food insecurity especially in Ethiopia, Kenya, Djibouti and parts of NE Uganda. But it is important for us to realise that the severity of the food crisis facing Eastern Africa could have been cushioned with better factoring of the advance climate forecasts that were relesaed earlier in the year.

Patrick Luganda

Joined: 06/17/2008
Escalating food prices have got both pros and Cons

Cases of small scale farmers in East Africa lacking access to markets for their surplus produce have been a common occurrence during every harvesting season.

An increased demand will offer an opportunity for them to access competitive markets and reap enough to plough back into buying inputs, thus increasing productivity.

The problem is that poor urban dwellers will be compelled to dig deeper into their pockets.
No wonder food riots continue to occur in our major cities.

Health, Environment and science journalist.
Science policy Journalism Intern at
Research, Research Ltd.