WCO urges awareness and action on food crisis

10 September 2010

WCO urges awareness and action on food crisis

Brussels, 7 September 2010

Press Release

The food crisis, especially rising prices caused by shortages, has re-emerged as a severe global problem, in particular for developing countries. The United Nations recently announced that food prices rose by 5% globally, due primarily to shortages in wheat. This is now leading to higher prices on the market, food hoarding, growing hunger, and in some countries food riots.

“I am gravely concerned with the growing humanitarian suffering caused by the burgeoning food crisis,” said Secretary General of the WCO, Kunio Mikuriya. “Customs administrations around the world should do what they can to help by facilitating food imports, enhancing coordination with other border agencies, and in the case of clearance of humanitarian relief consignments, simplify and expedite Customs procedures and waive import duties.”

Globally, transaction costs at borders impact the price of food, therefore facilitation of border agency procedures can be expected to decrease prices. Indeed, Customs has a role to play in ensuring that food supplies are cleared expeditiously to meet the needs of people affected by the crisis. Moreover, the WCO’s revised Kyoto Convention on the simplification and harmonization of Customs procedures and the Istanbul Convention on temporary admission contain standards that guide effective and efficient Customs clearance procedures for relief consignments.

Awareness is also essential. Customs should inform all appropriate stakeholders on decreases in border transaction costs to prevent some importers from including these implied costs to their own benefit. Communication in a transparent environment is therefore another key role that Customs can play. In this regard, Customs must convey how much it contributes to price reductions to put pressure on those who inaccurately assess the causes of price increases.

Customs must therefore ensure that food is not hoarded in ports awaiting food prices to rise even higher. If Customs does not monitor economic regimes such as Customs warehouses, this will lead to the creation of favourable conditions for goods speculation. Customs can also assist by providing empirical information on the food crisis, such as real time data on food imports and exports, and evaluate who is speculating.

By collecting, analysing, and sharing tangible, accurate information, Customs can counter rumour and speculation that are contributing to instability in the food market.