As soaring food prices begin to bite, experts say Malaysia has learned little from the pandemic
KUALA LUMPUR, May 21 – Experts say Putrajaya has failed to react quickly enough to tackle long-standing structural issues threatening national food security, leaving Malaysia vulnerable to a global commodity supply shock which caused commodity prices to skyrocket.
Food policy advocates have long warned of the dangers of the country’s growing reliance on imports to meet its food demand, as well as on the fertilizers and crops that feed livestock, making it particularly vulnerable to supply chain disruptions.
Food insecurity came under the spotlight after the Covid-19 crisis exposed underlying disparities in access to food, but experts said no tangible action had been taken since the pandemic to solve Malaysia’s food conundrum, as calls grew for food production to be prioritized. cash crops.
Fatimah Mohamed Arshad, who heads the agriculture and food security group at the Malaysian Teachers’ Academy, suggested that Putrajaya should put in place what she called a “food-first policy” to divert resources towards producing more food locally, including the domestication of input production such as making our own fertilizers or small machinery to reduce costs.
“Malaysia should give high priority to food by instituting a food-first policy and mobilizing resources to increase food productivity and value addition and reduce production costs,” she told Malay Mail.
“It needs to produce its own fertilizer, apply advanced technology, develop small machinery and processing plants for small producers and traders, and move to a high-tech supply chain, among others.
Putrajaya unveiled the National Food Security Action Plan 2021-2025 last year amid public concern over the rising cost of food when Covid-19 restrictions disrupted supplies.
Although resource-rich, Malaysia’s food trade deficit has widened over the past decade. The nation of 33 million people imported RM55.5 billion worth of food against RM33.8 billion worth of exports in 2020, resulting in a large deficit of RM21.7 billion, according to data from Bank Negara Malaysia.
Total food imports amounted to RM482.8 billion, compared to RM296 billion in exports over the past ten years, a trend that food security researchers say is “worrying”.
Malaysia now ranks 39th in the Economist Intelligence Unit’s 2021 Global Food Security Index, which assesses food security in more than 100 countries using indicators such as affordability, access, natural resources and resilience, among others.
Malaysia’s ranking was well below resource-poor countries like Singapore, which ranked 15th, and Qatar, which ranked 24th.
Tan Sri Muhyiddin Yassin, then prime minister, said the plan aimed to reduce the country’s reliance on food and input imports by focusing more on domestic food production.
One of the main thrusts of the plan would be to modernize food production, move away from labor-intensive methods and strengthen research.
But experts said structural reform and food production take time, so it will be years before consumers can expect to see tangible results from the plan, so some researchers have proposed liberalizing imports of food as a quick fix.
“We should limit the issuance of Approved Permits (AP) for imported products to certain categories only (such as) food products that have (lower) self-sufficiency rates,” wrote Amanda Yeo, an analyst at the Emir think tank. Research, in an article. on the subject published earlier this month.
“In other words, liberalize our food import system to ensure a level playing field and fight against monopolies and oligopolies that increase the cost of doing business and the cost of living.”
On Wednesday, Prime Minister Datuk Seri Ismail Sabri Yaakob lifted the PA requirement for food imports in a bid to alleviate some of the problems stemming from global supply shortages that are squeezing food import prices.
The move was criticized by local producers who said it could hurt local farmers and food producers who will have to compete with cheaper imports from big producing countries, which tend to be heavily subsidized.
Food security advocates and researchers have mostly agreed that Malaysia’s food security is likely to depend on the political will of elected leaders to make painful reforms that would primarily harm allies who have benefited from a system of distorted supply that tends to favor cartels and oligopolies.
Nurfitri Amir Muhammad, an activist who coordinates the Food Sovereignty Forum, said the AP import system had largely enriched politically connected business elites instead of smallholders, although he suggested that the protectionism offered by a license quota could still help small producers thrive.
“There are numerous allegations that the AP system has been abused to allow certain parties to monopolize the market,” he told Malay Mail.
“We need to reform and improve the system so that it is limited and granted only to eligible wholesalers, and not totally abolished,” he added.
On the retail side, Yeo said the government should work closely with non-governmental organizations to organize open-air food bazaars that could allow food producers to sell their fresh produce directly, cutting the “middlemen” to make food cheaper.
“They could identify several hotspots in each Malaysian state and implement carnivals at least twice a month. Owners of mom-and-pop stalls will have the option of selling leftovers but edible foods or ‘substandard’ vegetables and fruits, generating their economic livelihoods,” she said.
“On the other hand, the middle class would find it more affordable to buy ‘low quality’ food at lower prices.”
Malaysia’s Consumer Price Index (CPI) in March 2022 increased by 2.2% to 125.6 from 122.9 in March 2021, exceeding the average inflation for the period January 2011-March 2022 which amounted to 1.9%. The surge was mainly driven by food prices, said Malaysia’s Statistics Department, which rose 4% in March year-on-year.
Food security is now a key part of Malaysia’s 12th Five-Year Plan, which Putrajaya says underlines its commitment to keeping food affordable and accessible to all.
But experts have warned of problems that often hamper execution, citing the failures of previous plans unveiled by several past administrations due to the government’s unwillingness to address structural shortcomings at all levels of the supply chain. supply.
“If Malaysia continues with business as usual or as it currently does, the situation could get even worse. Indeed, the global market may face more shocks in the future,” Fatima said.