[:en]The mechanism considers the exchange of information between governments on product stocks in order to reduce price speculation, something that Walker also hopes to avoid locally, although he does not think price fixing is needed.
A better alternative, he says, is to keep farmers’ markets working, because that ensures competition, “as long as they comply with sanitary measures.”
Creating two WhatsApp groups was one of the first things that the Minister of Agriculture, Antonio Walker, did to address the coronavirus crisis in his sector. In one, he included leaders from almost 70 agricultural associations, and in the other, leaders from farming confederations. His goal? To have direct access to the sources to overcome the obstacles or issues stemming from the measures implemented to control the spread of the disease that affect the continuity of the food supply.
The Secretary acknowledges there have been many issues. One of the most difficult, he says, were the circulation permits, because when the state of catastrophe and the curfew were declared, they did not include all the activities that are part of the food chain. The same thing happened later with sanitary customs checkpoints and sanitary cordons that made logistics extremely difficult in some cities.
“First, we talked to regional authorities to resolve the highest number of situations at a local level, without escalating them to the central government. Today, the agricultural sector is one of the few sectors operating relatively normally, with an operation level close to 90%,” he says.
Walker points out that in the ports of San Antonio and Valparaíso, as well as in sanitary cordons and customs, trucks have to wait up to more than six hours, disrupting the entire food chain. Despite this, he ensures that “we have enough food to cover COVID-19 and the winter season.”
Opening borders
The Minister argues that an important lesson for small countries such as Chile, which are not able to meet their entire food demand, is to prioritize food security over food sovereignty, which means opening borders.
Based on this assumption, he reveals one of the projects he is currently promoting. Taking advantage of the fact that Chile holds the presidency of the Southern Agricultural Council (CAS), which also includes Argentina, Brazil, Uruguay, and Paraguay, as well as new-members Peru and Bolivia, he is promoting the creation of a food exchange system for the Southern Cone.
This week, the group’s ministers agreed that FAO’s Regional Office will coordinate the mechanism, and next week they will take another step: each country will declare its food stocks. That is the essence of this coordination, since transparency will help reduce the risk of price speculation that occurs during crises. And then, based on data from trade balances, the volumes to be traded will be transparently defined while considering each stock.
Walker explains that the exchange, for which the regulatory details should be defined as soon as possible, will occur with products where Chile has surpluses, and that, in turn, it would seek to ensure access to meat, wheat, rice and fruits (banana and pineapple). “This is good for all CAS countries because we have different climates and some degree of deficit and surplus of products. By moving forward with this model, we would provide food security to much of Latin America,” says Walker.
“I have fought for farmers’ markets to continue operating”
Back in Chile, after bakers’ representatives announced a 20% increase in the price of bread, the head of Agriculture says that after discussing with them the costs that have risen, meaning flour, oil, and labor, the increase should not exceed 3%. “This year we have to worry about price adjustments, because the economic impact of the pandemic will be very hard, and we have to guarantee the stability of the food basket,” he says and points out that he does not think price fixing is needed.
Walker believes that one way to ensure competition and avoid speculation is keeping farmers’ markets open, despite the fact that due to their characteristics many consider them a source for spreading COVID-19.
“I have fought for farmers’ markets to continue operating, because they are the sole source of supply for 70% of the country’s population, and they also prevent unnecessary movement between municipalities, particularly those that do not have or no longer have supermarkets. But for this to happen, the markets must respect the health protocol that we have designed, and municipalities have to oversee it,” says Walker. He adds that in order to relieve overcrowding in these spaces, it is key that only food is sold and no other products. This means taking measures to prevent the presence of “tailenders”, street vendors without permits.
He says that to confront the crisis, food producers are asking for liquidity and financing. That is why the government will allow extensions and renegotiation of loans for small farmers given by the Agricultural Development Institute (INDAP). The State Bank, BancoEstado, and CORFO, the Chilean Economic Development Agency, will take care of medium-sized farmers. For larger companies “we would like to call on banks to replicate these measures,” he concludes.[:]
