GLOBAL FOOD POLICY REPORT UNVEILS STRATEGY FOR REDUCING HUNGER WITH GLOBAL GOVERNANCE, INVESTMENT, & TRADE

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The year 2017 was marked by increasing uncertainty amid mixed signs of progress. The world enjoyed a strong economic recovery, but global hunger increased as conflicts, famine, and refugee crises persisted. With the withdrawal of the United States from major international agreements, Britain’s “Brexit,” and rising anti-immigration rhetoric in many countries, the world began to step away from decades of global integration that have yielded unprecedented reductions in poverty and malnutrition. 

The rise of isolationism and protectionism, visible in the US withdrawal from multilateral trade and climate agreements, the UK’s “Brexit” from the EU, and growing anti-immigration rhetoric in developed countries, threatens to slow progress toward the Sustainable Development Goals and improved food security and nutrition, according to the 2018 Global Food Policy Report released by the International Food Policy Research Institute (IFPRI) few days ago.

Although backlash against globalization has been mostly portrayed as a phenomenon affecting the developed world, the report highlights how rolling back global integration could harm the livelihoods of millions of poor people in the developing world as well. The report is the latest in an annual analysis of developments in food policy around the developing world, based on the most recent available evidence.

“Policies that encouraged globalization through more open trade, migration, and knowledge sharing have been critical to recent unprecedented reductions in hunger and poverty,” added Fan. “Enacting policies to leverage the benefits of globalization while minimizing the risks that fuel antiglobalism will be critical to meet the Sustainable Development Goals to end hunger and poverty by 2030.”

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The report scrutinizes the impact developed-country farm support has on farmers in developing countries and global food security. Farm support policies from these wealthy nations—particularly high tariffs and support prices—depress global prices, forcing poor farmers in less wealthy countries to compete without similar levels of support.

“The real losers from policies that protect farmers at the expense of distorting international prices are low-income farmers in poor developing countries, who suffer lower prices and greater rural poverty. The long-term effects of developed-country farm subsidies on developing countries are particularly pernicious: reducing incentives for production with adverse consequences for food security, nutrition and rural development,” said Joseph Glauber, senior researcher at IFPRI, and former chief economist for the United States Department of Agriculture.

When international trade is open, however, authors of the report argue it improves food security. “Trade has become a symbol of the failures of globalization, but it has been essential for many of our greatest achievements in improving livelihoods across the globe in recent decades,” said David Laborde, senior researcher at IFPRI and co-author of the report chapter on trade.

Facilitated by global agreements, trade has lowered the average cost of food worldwide and expanded access to more and more diversified foods. Trade barriers, on the contrary, lead to high food prices in land-scarce countries, depressed food prices in land-abundant countries and lower real income in both. While the authors recognize the potential risks associated with trade opening—including rising inequality, health impacts, increased energy use, and environmental damage—they argue these are better addressed with policies that directly target the source of the problem, rather than by hampering trade.

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On the rising anti-immigration rhetoric, researchers debunk the populist notions that immigration disrupts local labour markets or increases crime, and present evidence suggesting voluntary migration is associated with greater food security for the migrants, and for their families that remain behind, as well as economic and fiscal benefits for the receiving country.

“Politically motivated arguments that immigrants decrease wages, increase crime, or impose financial burdens on receiving countries are not supported by the evidence from research on migration,” said Alan de Brauw, senior researcher at IFPRI and co-author of the report chapter on migration.

To strengthen governance of our global food system, chapter author Joachim von Braun recommends establishing an International Panel on Food, Nutrition, and Agriculture—modeled on the International Panel on Climate Change. “An International Panel on Food, Nutrition, and Agriculture would mobilize the related large global research community to provide credible science-based assessments and guidance for more evidence-based political decision-making,” said von Braun, director of the Center for Development Research.

This year’s report also features chapters on how global private investments in agriculture can help the world meet the Zero Hunger goal; the role of open access data in improving livelihoods; as well as updated datasets on agricultural investment, public expenditures, and more.

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The report emphasizes that despite daunting challenges the world currently faces, improving food systems provides a path to address them within the sustainability parameters of the planet.

“Food systems have the unique potential to fix many of our most pressing global problems, but must be transformed into sustainable systems that support healthy diets for all,” said Fan.

Africa’s sustained economic growth since the early 2000s has been underpinned, in part, by globalization through increased investments, including capital inflows, and favourableble commodity prices that enabled strong export growth. The improved growth performance resulted in declines in poverty, hunger, and malnutrition and enabled a middle class to flourish. However, Africa south of the Sahara still has a high poverty rate and a number of poor compared to the other regions of the world. Furthermore, the continent’s dependence on exports of primary commodities leaves it vulnerable to volatile global markets, as witnessed in 2016 when the sharp decline in commodity prices slowed economic growth. Meanwhile, conflicts and increased climate variability continue to threaten food security and nutrition in Africa. In addition, high poverty levels and conflict have forced many Africans to illegally migrate abroad, especially to Europe, under treacherous conditions.

In the face of the headwinds of anti-globalism, African countries should focus on implementing broad-based policy reforms that will allow their economies to thrive in a competitive global environment, generate employment, and build resilient food systems and livelihoods. Policy reforms should also promote trade openness, export diversification, and foreign direct investment (FDI) to keep these countries on a path of sustained and inclusive growth and food security.

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GLOBAL FOOD POLICY REPORT UNVEILS STRATEGY FOR REDUCING HUNGER WITH GLOBAL GOVERNANCE, INVESTMENT, & TRADE - Brand SpurGLOBAL FOOD POLICY REPORT UNVEILS STRATEGY FOR REDUCING HUNGER WITH GLOBAL GOVERNANCE, INVESTMENT, & TRADE - Brand Spur
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GLOBAL FOOD POLICY REPORT UNVEILS STRATEGY FOR REDUCING HUNGER WITH GLOBAL GOVERNANCE, INVESTMENT, & TRADE - Brand SpurGLOBAL FOOD POLICY REPORT UNVEILS STRATEGY FOR REDUCING HUNGER WITH GLOBAL GOVERNANCE, INVESTMENT, & TRADE - Brand Spur

Latest News

Asia Pacific Rayon Raises US$300m from National and International Affiliated Banks to Expand Production Capacity

  • Continued capital expenditure aims to boost production and support the recovery of Indonesian economy
  • Loan agreements aligned with Indonesian Government's strategy to drive investment growth in 2021
  • APR is a member of the RGE group of companies


JAKARTA, INDONESIA - Media OutReach - 12 April 2021 - Asia Pacific Rayon (APR), the largest integrated rayon fiber producer in Indonesia, today announced that it has secured a syndicated loan facility of Rp 4.5 trillion (US$300 million) with national and international affiliated banks. The funding will be used to support continued capital investment in the company's production facilities at Pangkalan Kerinci, Riau Province, Sumatra.

APR is vertically integrated through its supply chain, from renewable fiber plantations to high-value textile development. It commenced operations in 2019 and was formally inaugurated by President Jokowi Widodo in February 2020. APR plans to increase its production capacity over the coming year to capture the strong growth potential of viscose staple fiber (VSF), strengthening its market position in Indonesia and in export markets across the region. APR is a member of the RGE group of companies. Founded by Sukanto Tanoto, RGE manages a group of resource-based manufacturing companies with global operations.

The syndicated loan participating banks are PT Bank Rakyat Indonesia (Persero) Tbk, PT Bank Central Asia Tbk, PT Bank Pan Indonesia Tbk, PT Bank Pembangunan Daerah Jawa Barat, PT Bank Woori Saudara Indonesia 1906 Tbk and PT Bank KEB Hana Indonesia

The joint mandated lead arrangers and bookrunners for the syndicated loan are PT Bank Rakyat Indonesia (Persero) Tbk, PT Bank Central Asia Tbk, and PT BANK Pan Indonesia Tbk.

Basrie Kamba, Director, Asia Pacific Rayon, said: "This funding will be used to support continued investment in our operations in Kerinci. Rayon fiber, or viscose, is a textile raw material derived from sustainably managed plantations. As rayon is both renewable and biodegradable, it supports the trend towards sustainable fashion in Indonesia and in other markets around the world."

APR's planned expansion is aligned with the Indonesian Government's strategy to increase investment and boost employment to support the recovery of the country's economy and address the continued impact of the COVID-19 pandemic. Following the passing into law of the Omnibus Bill in October last year to streamline investment and stimulate job creation, President Widodo said last month that investment would be the key factor in achieving 5% economic growth in 2021.

"This loan facility and our continued investment in our operations are evidence of the growth potential of the viscose rayon sector in Indonesia and around the world. We are committed to supporting the Indonesian Government's efforts to improve the investment climate in export-oriented manufacturing industries, and its efforts to create upstream jobs in plantations and the processing of raw materials, and downstream opportunities in textile factories and related businesses," said Basrie.

Hari Setiawan, Executive Vice President of PT Bank Rakyat Indonesia (Persero) Tbk said : "As Representative of JMLAB and all lenders, I hope this collaboration will be useful to support the growth and development of PT Asia Pacific Rayon in increasing production and operations and also supporting the recovery of Indonesia's export growth."

"Support from BCA and other Banks reflect our confidence in APR, and as our contribution to promote a sustainable and environment friendly industry. We hope this cooperation will tighten our relationship as well," said Susiana Santoso, Executive Vice President of PT Bank Central Asia Tbk.


About Asia Pacific Rayon

Asia Pacific Rayon is the first fully integrated viscose rayon producer in Asia. Located in Pangkalan Kerinci, Riau, the company uses the latest production technology to produce high-quality rayon to meet textile needs. APR is committed to becoming a leading viscose rayon producer with the principles of sustainability, transparency and operational efficiency, serves the interests of the community and the country, and provides value to customers. APR is part of the RGE (Royal Golden Eagle) group of resource-based manufacturing companies. Sustainability is fundamental to APR. The APR Sustainability Policy, updated in September 2020, include additional commitments on pulp sourcing and clean manufacturing.


About RGE

RGE Pte Ltd manages a group of resource-based manufacturing companies with global operations. Our work ranges from the upstream, comprising sustainable resource development and harvesting, to downstream, where our companies create diverse value-added products for the global market. Our commitment to sustainable development underpins our operations, as we strive towards what is good for the community, good for the country, good for climate, good for customer, and good for company. RGE was founded in 1973. The assets held by RGE companies today exceed US$20 billion. With more than 60,000 employees, we have operations in Indonesia, China, Brazil, Spain and Canada and continue to expand to engage newer markets and communities. www.rgei.com

GLOBAL FOOD POLICY REPORT UNVEILS STRATEGY FOR REDUCING HUNGER WITH GLOBAL GOVERNANCE, INVESTMENT, & TRADE - Brand Spur
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