This note examines how small developing countries have used trade-related and support measures to protect their food supply and agricultural livelihoods from the shock caused by the Covid-19 pandemic. From the experience of implementing these measures, lessons are drawn for the WTO’s agriculture agenda, identifying priorities for updating agricultural trade rules.
The pandemic and its effects on agricultural markets and incomes induced concerns over food security and nutrition worldwide. The agricultural markets reacted to the pandemic through, inter alia, rising food prices and significant increase in food import bills. Despite the remarkable resilience of the agri-food sector, the economic downturn and increased poverty arising from the pandemic contributed to the largest single year increase in global hunger in decades. Global hunger in 2030 is projected to be above the level it would have been had the pandemic not occurred.
Around the world, governments took emergency response measures to contain the spread of the pandemic and protect their citizen’s health, but also to secure their access to food and protect their jobs (which in least developed and low-income countries remain mostly in the agriculture sector). Such measures included various forms of support to businesses and consumers, as well as trade-related measures to mitigate or prevent disruptions in food and other supply chains.
This note examines how small developing countries have used trade-related and support measures to protect their food supply and agricultural livelihoods from the Covid-19 shock, based on a based on a dataset covering over 1600 response measures taken by governments. The main objectives pursued by the reviewed measures can be broadly categorised into: (i) measures aimed at securing food supply for consumers, and its affordability for them; and (ii) measures aimed at protecting businesses and their workers, including those involved in the food value chain.
It is found that the experience of the pandemic has highlighted the importance of securing food supply chains, and the critical role that trade plays in this regard. While Covid-19 severely tested the multilateral trading system and exposed some needed adjustments, food supply chains showed remarkable resilience. It is also reassuring that trade-facilitative measures adopted by members on agriculture-related products outnumbered trade restrictive ones in this area.
Nevertheless, the crisis also made clear that small developing countries remain extremely vulnerable to shocks, and will need to build greater preparedness and resilience. Covid-19 is unlikely to be the last systemic crisis to stress-test these countries’ food supply chains, particularly in light of the worsening effects of climate change. It is high time for governments to take a forward-looking approach to policy making, ensuring global trade rules and national trade policies promote greater resilience to future shocks.