Transcript Slide 1

New Modalities of International Food
Assistance: A Review of the Evidence
Joanna B. Upton
Erin C. Lentz
Christopher B. Barrett
Cornell University
Presentation at AAEA Annual Meetings
Pittsburgh, PA
July 2011
Based on chapter in forthcoming volume
C. Barrett, A. Binder and J. Steets, eds.,
Uniting on Food Assistance: The Case for Transatlantic Cooperation
(London: Routledge, 2011).
Motivation
Expanding choices for food assistance:
No longer just shipment of bulk food aid from a donor country.
Evolving donor policies:
1. Local and regional procurement (LRP):
LRP increased in value from 13% of all food aid in 1995
to 50% in 2009. WFP spent >$1.2 bn on LRP in 2010.
2. Increased use of cash and vouchers:
Address access and use, not just availability issues.
3. Recent expansion of USAID prepositioning program
New partners:
Middle-income countries now providing food assistance.
Backup table
New Food Assistance Modalities
New Modalities of Food Assistance:
Form of Transfer PROVIDED and RECEIVED
RECIPIENTS RECEIVE:
Specific
FOODS
sourced in
donor countries
CASH
DONOR
PROVIDES:
FOOD
Specific
FOODS
sourced
locally or
regionally
LRP
Prepositioned
Aid
Direct Aid
A variety of
FOODS
sourced
locally
Vouchers
CASH
Cash
Motivation
Modality choices differ in implications for different sub-groups
Recipients: women, children, acutely malnourished…
Non-recipients: neighboring food-insecure populations,
producers, traders…
Advantages and disadvantages depend on objectives and
priorities…and program objectives are expanding.
Cost, timeliness, security, consumption, nutrition, asset
protection/creation, recipient preferences, price and
market impacts
Shortcomings in available evidence:
Limited scope and scale of many new tools
Absence of rigorous counterfactuals limits how sure we
are of apparent differences in performance.
Motivation
Key Food Assistance Program Objectives:
1) Cost Effectiveness
2) Timeliness
3) Security
4) Consumption and Nutrition
5) Assets and Welfare
6) Recipient Preferences
7) Price Impacts
Key findings 2
1) Cost
Broadly, from most to least costly:
prepositioned>transoceanic>LRP> vouchers > cash
But, we need to take into account specific objectives
Prepositioning entails additional storage costs
Relative costs of LRP depends on sourcing region; but
LRP can entail significant cost savings
Evidence from East Africa:
CFGB: regional procurement 65-87%
of the cost of importing Canadian grains
USAID: local procurement 54-77% of the
cost of importing U.S. grains
Consider start-up costs of identifying buyers and
verifying local quality standards
Costs of voucher and cash distributions vary
Key findings 2
2) Timeliness
Key comparisons (on average):
Transoceanic versus prepositioned:
Eastern Africa: time savings of up to 75%
Pakistan: 2-3 weeks for pre-positioned food from
Djibouti (≥ 3 months for U.S. food)
Transoceanic versus LRP:
Varies by region, commodity, and timing…
US GAO: 10-country averages in sub-Saharan
Africa, 21 weeks for U.S food, 7-8 weeks for LRP
CFGB: Kenya, Ethiopia, & Afghanistan, 11-19
weeks for Canadian food, 4-6 weeks for LRP
Prepositioned versus LRP? Unknown
Cash/vouchers versus prepositioned/LRP? Unknown
Key findings 2
3) Security
Two dimensions:
1) loss due to corruption
2) risk of harm to recipients
Each modality has trade-offs for safety considerations
Visibility: is it a vice or a virtue…?
Evolving technologies can circumvent some security
problems
Key findings 2
4) Consumption and Nutrition
Percentage of transfer consumed as food increases as
one moves from cash to vouchers to food
But:
Most cash (60-90%) is spent on food, and
Food transfers are not necessarily consumed as
food; sales to meet other needs are common
Cash recipients consume more diverse diets, but other
modalities allow for targeting of specific nutritional
objectives
Key findings 2
5) Assets and Welfare
Transfers can have asset effects:
Human capital effect on nutrition and health of
recipients
Food aid in Ethiopia has been known to protect
assets, by allowing recipients to avoid selling land
and livestock
A portion of food assistance transfers is sometimes
used to build assets
Key findings 2
6) Recipient Preferences
Recipients tend to prefer greater flexibility…but not
always
The form of transfer may affect the balance of power
within the household
Voucher and cash recipients may not be shielded
from price increases
Key findings 2
7) Price Impacts (and implications for welfare,
markets and agricultural production)
Deliveries of in-kind aid (whether from donor country
or from a source market regionally or locally)
represent a supply shock. Price effect ≤ 0.
LRP procurement or provision of cash or vouchers,
represents a demand shock. Price effect ≥ 0.
Food assistance interventions can move local market
prices, with varied production and welfare impacts.
The food price dilemma:
There are always winners and losers, so need to
be very explicit about priority sub-population(s).
Motivation
The importance of “Response Analysis”
Given multiple available modalities options and the lack of
generalizable findings, choices must be considered on a
case-by-case basis.
A combination (or sequence) of modality options is
commonly preferable in any given setting.
There is as yet no generally accepted response analysis
practice, but several frameworks have been developed (e.g.,
MIFIRA: Barrett et al., Food Security, 2009).
Motivation
Coordination
Donors have varying constraints
Implementing agencies varying capacities and experiences
Lack of coordination runs — perhaps significant—risks:
Quite possible that different agencies are
monetizing food and procuring food simultaneously in
the same marketing system
Opportunities for coordination at several levels:
Regional (e.g., C-SAFE, the Consortium for Southern
African Food Security Emergency)
National (e.g., the Kenya Food Security Steering Group)
Sector (e.g., the USDA LRP Learning Alliance)
Motivation
Summary
There is not (and is not likely to be) a generalizable
ordering for which modality choices work best for
providing food assistance to food insecure peoples.
The right response depends on context and specific
program objectives
Systematic Response Analysis is needed to ensure that
expanded toolkit leads to improved performance.
Improved coordination is likewise essential so that
agencies aren’t working at cross-purposes to one another.
Motivation
Thank you for your time and interest
Special thanks to
Cheryl Christensen of USDA-ERS
for organizing this session and kindly
presenting on our behalf!