Eleni Gabre-Madhin Building a commodities market in Ethiopia

From YT:
http://www.ted.com Economist Eleni Gabre-Madhin outlines her ambitious vision to found the first commodities market in Ethiopia. Her plan would create wealth, minimize risk for farmers and turn the world's largest recipient of food aid into a regional food basket. "There is no place in the world and no time in history that small farmers have had to bear the burden of risk that African farmers bear today," Gabre-Madhin says. "But I'm not here to lament or wring my hands. I'm here to tell you that change is in the air."

Direct TEDTalk link:
http://www.ted.com/index.php/talks/view/id/185

Updated with the direct TED link. Full screen this one.
schmawysays...

Rickegee posted an interesting comment in a farm-subsidy video about how they (the subsidies) function to keep developing agriculture down. Can't find it now. This Gabre-Madhin is a beautiful woman. She's not bad looking either.

Farhad2000says...

The biggest hurt on creating a commodities based market with regards to agriculture in Africa is the unfair trade factors working against farmers in Africa, and dumping of surplus agricultural products, every time a famine or drought strikes the region the developed world throw undue amounts of food aid into the nation (USAID).

While this is of course necessary for the short term, this doesn't translate into a long term strategy to develop and or recover an agricultural market in the region, farmers thus go back to grow to self sustain only. What happens is that the aid becomes a commodity in itself, how could a struggling agricultural market compete against something basically offered for free? This is due to the fact that aid resides for far longer, there have been countless reports of aid being ceased and then resold by unscrupulous people who pick up aid to redistribute it but then instead resell it for certain price, or simply stock pile to reinject back into the market in another region. Oh yeah and those clothes you 'donated' to help Africa? They are bought up then resold as well. There is just simply no mechanism in place to watch over how aid is distributed its all done on faith that it will be done ethically.

At the same time the agricultural market in the west is sustained perpetually via high subsidies from the government (see EU CAP policy and US Food Homeland Security Act), which also reflects in world agricultural trade (see WTO and agricultural trade petitions), effectively agricultural products from the west are dumped on the world market below cost of production undercutting any developing agricultural markets in the developing world.

This is of course rather unfair given that while only a small percentage of the West's economic activity resides in agricultural markets whereas its nearly 70% to 80% of the economic activity in developing nations since industrialization and services based industries depend on a developed agricultural market first.

There are other issues also, borders between African nations are most usually closed, there is a lack of infrastructure to allow free movement of such commodities between nations. The continent should be able to respond to member nations crisis, but that mechanism is not there, and reflexively asking for aid from the west usually also brings large paychecks and Mercedes cars to corrupt leaders in power. You know all the problems would be solved if we just kept throwing wads of cash at them without any accountability, you been to LiveAid? bought that crappy white band for Make Poverty History? Do you have any idea what happened to that money? I thought so...

If the west wanted to help the developing world in it's problems with regards to agriculture it would stop subsidization, stop depressing world food prices, help and developing a self sustaining agricultural market in Africa through education and good practices (scorch and burn is still a widely used agricultural practice in Africa). However this comes at the cost of upsetting farmers in the west, though that doesn't exist anymore, its usually large corporations holding huge tracts of land, lobbying the government (look at the powerless FDA) for protectionist trade policies (to benefit themselves not the consumer), producing at above cost sustained by subsidies from the government.

schmawysays...

Great comment Farhad. My concern with stopping subsides is that the American "Bread basket" would whither to the point where we could no longer be self-sufficient if need be. The old adage of "every civilization is three meals from a revolution" may be true, but I don't have any gauge on whether or not we could be self-sufficient without subsidies. Or for that matter how much food we import, which I imagine would be a fairly small amount.


On the other hand, maybe self-sufficiency isn't that important, that we should need our our global neighbor's food.

For a look at how gross farm subsidies actually are, see rickegee's discarded vid:

http://www.videosift.com/video/Pay-Dirt-Subsidies-and-the-American-Farmer

Farhad2000says...

Food subsidies create a vicious cycle of increased production, you get subsidized for a a certain amount, once you profit you decide to expand production (you are in a competitive market after all) so next years yield is even larger, you get subsidization and press the government to export your produce as well to other nations (see CAFTA, NAFTA and GATT on their effects on agricultural markets in Mexico and Latin America).

Next year you expand production again, you lobby for even more protectionism trade policies because my god those darn Latinos and Africans can produce everything at much lower costs! So you get more subsidization, export more at lower cost of production, dumping more goods on the world market while only allowing domestic agricultural competition. This goes on and on and on... its not to the benefit of the consumer who ends up paying more for basic food items, still facing risks from a industry fixated with output over quality (Fast Food Nation? Spinach a la E.Coli? Lobbying FDA to lower standards?).

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