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Food Emergency: How the World Bank and IMF Have Made African Famine Inevitable

Crossposted from AlterNet:

“Why, in a world that produces more than enough food to feed everybody, do so many – one in seven of us – go hungry?”  – Oxfam   

Famine is spreading like wildfire throughout the horn of Africa. As 12 million people battle hunger, the UN warns that 750,000 people in Somalia face imminent death from starvation over the next four months, in the absence of outside intervention. Over the course of just 90 days, an estimated 29,000 children under the age of five died in Southern Somalia, with another 640,000 children suffering from acute malnourishment.

In the rush to find a culprit to blame for the tragedy unfolding in East Africa, the mainstream news outlets attributed the cause to record droughts, a rise in food prices, biofuel production and land grabs by foreign investors with an added emphasis on the role of the Somali terrorist group Al-Shabaab. Yet these factors alone are not responsible for the famine; instead they have intensified an already dire hunger crisis that has persisted in Sub-Saharan Africa for decades, thanks to lending policies pushed by the World Bank and International Monetary Fund (IMF) that transformed a self-sufficient, food-producing Africa into a continent dependent on imports and food aid, leaving the continent vulnerable to food emergencies and famine.

Since 1981, when these lending policies were first implemented, Oxfam found that the amount of sub-Saharan Africans surviving on less than one dollar a day doubled to 313 million by 2001, which is 46 percent of the population. Since the mid-1980s, the number of food emergencies per year on the continent has tripled.

According to Oxfam International spokesperson Caroline Pearce, the IMF and World Bank structural adjustment programs of the ’80s and ’90s led to “huge disinvestments in the agricultural sector.” Pearce concludes, “What we’re seeing now in poor agricultural systems partly relates to those kind of policies. In many cases, we’re actually calling for things to be reestablished that were dismantled under structural adjustment programs in the past.”

Yet the impoverished countries of Africa, imperiled by mass starvation, continue to pay for a “free market” agenda, and it’s costing them their lives.

From Food Abundance to Mass Starvation

Walden Bello, reporting for Foreign Policy in Focus, observes that Africa was self-sufficient in food production after declaring independence from its colonial rulers in the 1960s. Yet today, hunger and famine in Africa have “become recurrent phenomena” across the continent.

According to BBC analyst Martin Plaut, Africa was also a food net exporter between 1966 and 1970, with an average of 1.3 million tons of food exported each year. In stark contrast, almost all of today’s African countries are dependent on imports and food aid, a dramatic shift that took less than 40 years to transpire.

Which begs the question: how did an entire continent go from being a net food exporter to a net food importer, from food abundance to mass starvation, in such a short period of time?

In her book The Shock Doctrine: The Rise of Disaster Capitalism, Naomi Klein details how global power players use times of crisis and chaos as a pretext for imposing destructive free-market policies that advance the interests of the wealthy. As far back as the 1970s, economists inspired by free-market guru Milton Friedman were inspiring U.S.-backed coups and military juntas to push an unpopular radical free-market agenda onto the unwilling populations of countries like Chile, Brazil and Argentina.

But Klein highlights a significant shift in strategy that took place in the mid-1980s, when economists recognized that a financial crisis “simulates the effects of a military war—spreading fear and confusion, creating refugees and causing large loss of life” — the same shock-inducing conditions that left societies ripe for disaster capitalism.

Throughout the ’60s and ’70s, Western financial institutions went on a lending spree at extremely low interest rates, mostly to developing countries that were encouraged to borrow. By the late ’70s and early ’80s, U.S. interest rates soared to levels as high as 21 percent, devastating the fragile economies of developing nations that had taken on massive debt.

Klein compares the impact of this “debt shock” to “a giant Taser gun fired from Washington, sending the developing world into convulsions.” African countries could barely afford the sky-high interest payments, let alone the actual debt and were thrown into a downward spiral of financial crises. This is where the story of Africa’s famine truly begins.

‘The Dictatorship of Debt’

The erosion of African agriculture is due in large part to policies imposed on debt-ridden African countries by the World Bank and the IMF—financial institutions set up in the aftermath of World War II with the stated aim of deterring financial crises like the ones that pushed Weimer Germany toward fascism.

The donor nations of the IMF and World Bank divvy up power within each institution based on the size of a country’s economy, allowing a handful of privileged nations, led by the U.S., to dominate decision making. As a result, Klein explains that the pro-corporatist administrations of Reagan and Thatcher in the ’70s and ’80s were “able to harness the two institutions for their own ends, rapidly increasing their power and turning them into primary vehicles for the advancement of the corporatist crusade.”

Driven by the ideology of the so-called free market, the IMF and World Bank attached conditions to desperately needed debt relief that required developing nations to implement Structural Adjustment Programs (SAPs), what Naomi Klein calls “the dictatorship of debt.”

SAPs forced governments to impose a neoliberal package of austerity, privatization and massive deregulation. For Africa, this meant cutting government subsidies to small farmers, eliminating tariffs and price controls, selling off food and grain reserves (which kept countries from starving in cases of drought or crop failure), increasing cash crop exports of raw materials to the west, and allowing foreign imports from the US and Europe to flood their markets.

Although the IMF and World Bank argued that restructuring was necessary to reduce Africa’s debt and foster economic growth, their policies produced the opposite effects: soaring debt and economic stagnation.

In a 2004 study commissioned by the Halifax Initiative, writer Asad Ismi meticulously documents the consequences of SAPs on the African continent. Between 1980 and 1993, he found a total of 566 structural adjustment programs were forced onto 70 developing countries, including 36 of Africa’s 47 Sub-Saharan nations. Since the implementation of SAPs in the 1980s, Africa’s debt soared more than 500 percent, with an estimated $229 billion worth of debt payments transferred from Sub-Saharan Africa to the west, four times the original debt owed. According to the IMF’s World Economic Outlook Database, African debt still stands at $324.7 billion, with the overwhelming majority, $278.5 billion, owed by Sub-Saharan Africa, demonstrating that SAPs have pushed Africa into perpetual debt, with no end in sight.

What does this have to do with famine? Well, perpetual debt forces governments to divert spending to debt repayment, rather than investing in basic infrastructure like healthcare and education, which is relatively non-existent in Sub-Saharan Africa. With only 10 percent of the world’s population, the Sub-Saharan region comprises 68 percent of all people living with HIV. Yet, according to Ismi, “Africa spends four times more on debt interest payments than on health care.”

The same holds true for the agricultural sector. SAPs initiated the collapse of African food security, diverting land, water and labor away from small-scale farming toward the production of cash crops, whose earnings were used to pay off debt.

Ironically, as they demanded that African states eliminate subsidies for small-scale farmers, the United States and Europe continued to provide their agricultural sectors with billions of dollars in subsidies, forcing peasant farmers to compete with an influx of cheap, subsidized commercial staples from the west—clearly a losing battle.

In 2004, Project Censored described this U.S. practice as “underselling starving nations,” a process that ensures U.S. commodities cost less than their small-scale counterparts, essentially pricing local farmers out of the market. Walden Bello points out that the World Trade Organization’s (WTO) Agreement on Agriculture cemented these lopsided policies, making developing countries the permanent dumping grounds for cheap surplus production from the global north. Thus, between 1995 and 2004, agriculture subsidies in developed countries went from $367 billion to $388 per year.

The few subsidies the IMF did permit were strictly reserved for African commercial agriculture goods for export to Europe and America. For Kenya, where a quarter of the population lives on less than a dollar a day, this meant ditching government support for subsistence farmers and diverting resources to the production of raw exports (cash crops) for the west, like tea, coffee, tobacco and cut flowers. Earnings from exports were then used to service the country’s massive debt.

After investigating the impacts of SAPs on Kenya’s struggle with malnutrition, Catherine Mezzacappaconcludes, “Through their role in agricultural policy and social spending, structural adjustment policies imposed by the IMF and World Bank have contributed to the deepening of poverty and perpetuation of malnutrition in Kenya,” a country where “the leading causes of death among children are preventable and can be linked to malnutrition.”

As environmental activist Vandana Shiva put it in her book Stolen Harvest, “The hungry starve as scarce land and water are diverted to provide luxuries for rich consumers in Northern countries.”

Somalia’s Road to Famine

But for Somalia, the outcome was far worse, because the application of these neoliberal policies coincided with U.S. meddling and military intervention.

Michel Chossudovsky, author of The Globalization of Poverty, explains that despite frequent droughts, Somalia’s economy, led by small-scale farmers and pastoralists or “nomadic herdsmen,” was self-sufficient in food well into the 1970s. The pastoralists proved quite successful as livestock produced 80 percent of Somalia’s export earnings through 1983. But under SAPs, veterinarian services for livestock were privatized, making it difficult and unaffordable for herders in rural grazing areas to access animal healthcare, ultimately devastating pastoralists who made up half of the population. As for agriculture, the cheap imports of rice and wheat displaced small farmers, and resources were diverted to grow export commodities. Worst of all, “Water points and boreholes dried up due to lack of maintenance, or were privatized by local merchants and rich farmers,” due to the privatization of water resources.

The impact of structural adjustment on Somalia’s food security was compounded by American and Soviet meddling during the Cold War. Stephen Zunes, professor of politics at the University of San Francisco, explains that Somalia was initially a client state of the Soviet Union in the early ’70s until Somali dictator Said Barre switched sides following a military coup in Ethiopia that replaced the U.S.-backed Ethiopian monarchy with a Soviet-backed “Marxist-Leninist” government.

The U.S. proceeded to prop up the Barre regime with $50 million worth of weapons a year for access to strategic military bases, despite warnings that Somalia’s authoritarian leader was committing atrocious human rights violations. Eventually, repression and social unrest led to the outbreak of civil war in 1988 between rival factions, fought with weapons provided by the United States. When Barre was overthrown in 1991, he left behind a chaotic “power vacuum,” with rival factions vying for control in a country lacking any centralized structure capable of alleviating the food insecurity to come.

The neoliberal dismantling of Somalia’s agro-pastoralist economy combined with U.S.-fed sectarian violence left Somalia extremely vulnerable to famine when faced with a drought in 1992, causing the mass starvation of 300,000 people.

Fast forward to 2011, and conditions in Somalia remain relatively unchanged. Civil war continues unabated, food insecurity persists, and recurring U.S. intervention endures in the name of “fighting terror” as journalist Michelle Chen recently highlighted at Colorlines. Only this time, Somalia and its neighbors are battling this lethal combination after having spent decades living just above starvation levels.

While economic policies from the ’80s and ’90s are not solely responsible for Somalia’s current famine, Chossudovsky asserts, it’s impossible to ignore that “ten years of IMF economic medicine laid the foundations for the country’s transition towards economic dislocation and social chaos.”

Malawi Starves

In one of most outrageous episodes of neoliberal incompetence, Walden Bello described the role of structural adjustment on Malawi in the late 1990s, when subsistence farmers were provided with “starter packs” of free fertilizers and seeds. The program yielded a surplus of corn. But then the World Bank and IMF stepped in to dismantle the program and compelled the government to sell the majority of its grain reserves in order to service its debt. Bello explains the fallout:

When the crisis in food production turned into a famine in 2001-2002, there were hardly any reserves left to rush to the countryside. About 1,500 people perished. The IMF, however, was unrepentant; in fact, it suspended its disbursements on an adjustment program with the government on the grounds that “the parastatal sector will continue to pose risks to the successful implementation of the 2002/03 budget. Government interventions in the food and other agricultural markets … crowd out more productive spending.

According to Bello, when the next food crisis hit in 2005, the Malawian government gave up on the “institutionalized stupidity” of the IMF and the World Bank. Bello writes:

A new president reintroduced the fertilizer subsidy program, enabling two million households to buy fertilizer at a third of the retail price and seeds at a discount. The results: bumper harvests for two years in a row, a surplus of one million tons of maize, and the country transformed into a supplier of corn to other countries in Southern Africa.

In the 2008 World Development Report, the World Bank shocked many when it acknowledged that structural adjustment from the 1980s was a failure that “dismantled the elaborate system of public agencies that provided farmers with access to land, credit, insurance inputs, and cooperative organization.” The Bank insists the intention was to “free up the market” so the supposed more efficient and less costly private sector could take over, but “that didn’t happen,” the report admits. It goes on to confess that the beneficiaries of privatization were “commercial farmers,” which left “smallholders exposed to extensive market failures, high transaction costs and risks, and service gaps” that threatened “their survival.”

Nevertheless, when asked whether structural adjustments increased food insecurity and vulnerability to famine in Sub-Saharan Africa, a World Bank spokesperson responded with the following statement:

The famine that has now been declared in six regions of Somalia and the food insecurity that has affected other neighboring countries in the Horn of Africa is the result of climate-related hazards in a context of political instability and conflict. It would be inaccurate to blame it on structural adjustment programs implemented three decades ago.

The spokesperson added that the Bank is providing $1 billion to aid the Horn of Africa, along with increased investments toward improving agriculture in the long-term, because “This crisis is a wake-up call for the need to manage agriculture in a changing climate.”

Recognizing Economic Violence

As tragic images of starving Africans in underdeveloped countries riddled with seemingly neverending violence and conflict fill the airwaves, a narrative emerges depicting Africa as a bottomless pit of charity and aid—one that ignores the historical context essential to understanding Africa’s impoverishment.

Writing for Al Jazeera English, David Nally, the author of Human Encumbrances: Political Violence and the Great Irish Famine, concludes, “The portrayal of the passive victim enables NGOs and Western governments to assume the role of rescuer without having to ask uncomfortable questions about their own complicity in the suffering that is unfolding.”

It’s time the West faced up to the reality that this famine is the inevitable consequence of a broken food system that prioritizes the hefty pockets of the privileged above the empty stomachs of the vulnerable, draining Africa of its resources and essentially stripping Africans of their right to food and life.

David Nally quotes Susan Sontag, reminding us that, “The more it’s shown that ‘the sort of thing which happens in that place’ is partly an outcome of policies designed in this place, the more responsibility we have to do something about it. When viewing images of starving children or reading about deaths from malnutrition in the daily newspapers, we ought to consider critically the architecture of violence behind the picture or story, not merely the sad abjection of the victim.”

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4 Comments
  1. Walter Broner #

    Rania: Yet another great post. Keep it up.
    It seems that any “blueprints” for a post-“fake-free-market” economy need to include a clear understanding that the “food”, “energy”, “shelter” ‘sectors’ of any economic arrangement cannot be subjected to tinkering by ideologues and multi-national companies. The economic structure must include heavy taxation – if not an outright prohibition – of speculation in prices of these basic staples of survival. Another possible path is to disengage as much as possible the wealth used in generating food, energy, and constructing shelters from being controlled by the international banking sector, creating locally owned and controlled credit unions/banks.

    September 12, 2011
  2. One answer to famine is Terra Prieta and the Well Spring Accumulator
    Jim Miller
    jimmiller5417@gmail.com

    September 12, 2011
  3. Mustafa Shaban #

    Awesomely written Rania! Probably one of your best articles! Its really important to see the link between African poverty and Western Economic aggression and genocidal IMF programs. Africa is a naturally wealthy continent only to be crushed by Colonial and Neocolonial designs!

    September 13, 2011
  4. Michael Price #

    Name a single time that disasters have facilitated the sort of changes Friedman wanted. One time. Disaster DON’T make people accept the free market, just the opposite. War in particular increases economic controls of all kinds. The IMF has NEVER been, and can never be, a pro-free market institution and it’s “reforms” have NEVER been pro-free market. Do the research.

    March 30, 2013

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