Latin America starts $100 million food fund

The presidents of Bolivia, Nicaragua and Venezuela, and Cuba's vice-president, launched a $100 million fund for staples such as rice, beans and corn to mitigate sharp rises in world grain prices.

Latin America starts $100 million food fund
Leftist leaders from four Latin American countries vowed to work together to grow more food on Wednesday, blaming capitalism and speculation for soaring world prices that are hurting many poor nations.

The presidents of Bolivia, Nicaragua and Venezuela, and Cuba's vice-president, launched a $100 million fund for staples such as rice, beans and corn to mitigate sharp rises in world grain prices.

The leaders said high prices, which have sparked riots from Egypt to Haiti, were largely caused by a U.S. policy to make ethanol fuel from corn.

"This issue is really crucial for the future of our people, most of all to the people of the poorest countries," said Nicaraguan President Daniel Ortega.

The United Nations' World Food Program this week called the growing food crisis a "silent tsunami" that threatens to plunge more than 100 million people on every continent into hunger.

The four countries, joined in a trading bloc called ALBA backed by Venezuela's oil money, already work together on farm projects, but said they would now step up production efforts.

"We were lucky, ALBA saw this coming," Chavez said. "Some projects are underway but now we have to speed them up."

Former Cuban President Fidel Castro warned over a year ago that the use of one of the world's most widespread food sources for ethanol would have dire effects on poor countries.

Chavez founded the leftist trading bloc as a counterweight to U.S.-led free-trade agreements that critics say damaged Latin American farm output by flooding the region with subsidized grains when price were low.

He said a regional food distribution system was needed to cut out the middle-men who he says take advantage of tight supplies to increase prices.

"We have to create a regional trade network to stop us falling into the hands of speculators," he said.

Import dependent countries have been the worst hit by high prices. Faced with rice doubling in price in under a year, Cuba is trying to quickly grow the staple on abandoned land.

Venezuela has the wealth to pay for expensive imports, but has suffered sporadic shortages of some products as price controls distort the supply chain and the government struggles to meet rising demand.

Reuters
Last Mod: 24 Nisan 2008, 11:58
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