### 1. Importance of Poverty Reduction, Agriculture, and Rural Development

Three out of four poor people in developing countries live in rural areas, and most depend on agriculture for their livelihood. Considering these circumstances, it is vital to address agricultural and rural development in order to bolster the income of farmers, improve the living environment of agricultural communities, and ensure employment opportunities so as to reduce poverty through sustainable economic growth. The World Bank’s World Development Report 2008 points out the importance of agriculture, arguing that agriculture continues to be a fundamental instrument for sustainable development and poverty reduction in the 21st century. $ ^{6} $

The MDGs list poverty reduction and the eradication of hunger as major objectives in stating its goal to “halve, between 1990 and 2015, the proportion of people who suffer from hunger.” The situation is particularly serious in Africa. One-in-three of the population of Sub-Saharan Africa, or approximately 200 million people, suffer from famine. $ ^{7} $ The recent soaring price of food incites significant problems for developing countries, and Africa in particular.

### 2. Rising Food Prices and African Countries

In Sub-Saharan Africa, grains such as corn, rice, and wheat account for an average of 20% of overall food consumption, and these three grains alone account for approximately 30% of their calorie intake. $ ^{8} $ The international prices for these grains have shifted in an upward trend since autumn 2006 due to such factors as a decline in inventory ratios and an increase in overall demand for grains. This became especially significant beginning in October 2007, while rice, in particular, has soared more than three-fold between January and May 2007.

Prices are beginning to settle in response to a forecast for rich harvests in 2008. Nevertheless, prices remain high compared with 2006 and are expected to stay higher than normal for the time being. Furthermore, the fundamental conditions of future food supply become gradually more volatile.

The demand for grains is expected to grow further due to the predicted population increase by 2.5 billion in developing countries by 2050, high economic growth in major developing countries, and increasing use for biofuel. Meanwhile, growth in agricultural productivity is currently slowing around the world, and it is predicted that expansion of new farmland will be limited. Forecasts show that the global supply and demand for food will be tighter and that prices will remain relatively high for the long-term. $ ^{9} $

The governments of developing countries are responding to the remaining concerns for social and political unrest, such as the occurrence of backlash and insurgencies against price increases due to the steep rise in food prices and other factors. However, there is a noticeable vicious circle in place where food supply shortages in the international market are spawned by the export restrictions of some food exporting countries, which have incited further increases in food prices. These factors are hindering the procurement and transfer of food, while also obstructing food aid from the World Food Programme (WFP).

The recent skyrocketing price of food is seriously impacting efforts in Africa for addressing poverty and famine reduction. In October 2008, the United Nations Food and Agriculture Organization (FAO) announced that there were 36 countries facing a food security crisis. $ ^{10} $ Twenty-one of those 36 were African countries. The World Bank has also reported that this hike in food prices would cause an increase in the world population struggling from famine to 44 million. $ ^{11} $ According to other research, it is forecasted that in Africa alone nearly 30 million additional people could possibly face poverty. $ ^{12} $

It is reported that increasing food costs, for example, have caused an increase in the poverty rate in Liberia from 64% to 70%. In Somalia, where 2.6 million people are currently facing a nutrition crisis due to drought and conflict, it is predicted that the number of people required for humanitarian assistance will expand to 3.5 million by the end of 2008 due to rising food costs. $ ^{13} $