State of food security in the Middle East

CLARITY Economic Consultancy is an Abu Dhabi-based consultancy & investment firm with a primary focus on Agribusiness and Natural Resources investments. Nicholas Lodge, managing partner and founder, leads the firm and its various activities. He has over 20 years of experience with investment banking, private equity and direct investment, and a strong focus on the primary sector, agribusiness and emerging markets.In a recent interview with Food Manufacturing Journal – Middle East, Mr Lodge sheds line on food security concerns in the region.

Political and economic issues impact the GCC food industry. What are your thoughts on this?

Food security is a global issue and an acute one at that. In poorer countries people can spend up to 80% of their available income on food and if they don’t have the money, they go hungry. As it is today, more than 1 billion people around the world do not have enough to eat. In the GCC, the situation is at this time less about being able to afford the food; it is more of an issue of whether the food can be available in the first place in the various countries. Supply is therefore a function of many factors and the GCC is vulnerable to any shocks, or interruptions, whether temporary or longer term. Weather events, such as drought, flood or fire can obviously impact on yields and therefore availability and price; however, political moves can also have the same effect. Various countries have at times imposed partial or total bans on exports. Equally disruptive are events such as war, political upheaval or economic unrest, such as strikes or blockades.

About 81% of total grain imports for the GCC pass through one point, the Suez Canal; 81% of total rice imports into the GCC also pass through a single choke point, the Straits of Hormuz. These two passages clearly highlight the extreme vulnerability of the GCC to any disruption and both are in areas where there is unrest and tension.The GCC therefore needs to, as it is increasingly trying to do, maintain multiple supply relationships and to engage with the rest of the world for the continued supply of basic food items necessary for the growing population across the region.

What is the current state of food security and sustainability in the region?

Food insecurity is the current status for the region and will remain the case. Sustainable food self-sufficiency is unattainable in the GCC; domestic production will only meet a small proportion of needs but typically consumes significant economic resources and effectively monopolises water use. About 80% of total water used in the GCC is used in agriculture, with the UAE having the highest per capita water usage in the world.

Is there hope for the Middle East to decrease its dependence on food imports?

No, import levels of all types of food will remain high; this is never going to change. What may improve is inter-Middle East trade, although this still involves the import by one country of produce from another. At the same time, trade and the import of food products is not necessarily a negative thing, and due to the necessity of this activity, policies and strategies that encourage the free flow of goods should be embraced and the region needs to increase the ways in which it engages with multiple suppliers and sources, building a mutually beneficial series of parallel relationships.

The Middle East is home to more than 5% of the world’s population and yet has less than 1% of the world’s renewable freshwater resources. As a result many countAir Jordan 33 XXXIII