Sunday, November 18, 2007

World Bank boss

"Q: Your emphasis on agriculture seems to be the way out for the developing world but there is no mention of the damage subsidies are doing to the developing world. Does your new job put you in a very different role since you argued to protect the developed world's interest as the US Trade Representative? "

"We got agriculture to the forefront since growth in agriculture has four times poverty reduction effect for people living under a dollar a day. When you look at some economies, investment in public sector infrastructure for agriculture was 13% of budgets and it has slipped to 4%. There is another aspect, which is in part driven by bio-fuels and in part due to higher incomes in India and China resulting in people changing their diets. So, you are seeing higher food prices. It's an opportunity for farmers and a risk in terms of higher food prices."

This is from an interview with Zoellick, the World Bank boss. Mind you, the world bank a few years ago published an article (i'll find the link) stating that investment in farming was a bad idea and ad poor poverty reduction potential, because it benefits mostly the rich. I say it really depends on how you invest. Read this short article, it is worth it.

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