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May 4th, 2020

Agri-food markets and trade policy in the time of COVID-19

Published by FAO,

This policy brief (PDF) by FAO examines different policy measures, with the aim to support informed policy decision-making during COVID-19. Policy makers are identifying the most appropriate measures to ensure that this pandemic does not translate into a food crisis. However, policy responses to deal with disease outbreaks can aggravate the situations and exacerbate their market impacts. While the scale of the COVID-19 pandemic is unlike any other crisis in recent history, the policy responses available to governments against actual or perceived disruptions in the agri-food markets are similar to those taken during previous crises. Policy measures should aim to address actual rather than perceived demand and supply disruptions; enhanced market transparency and coordination with all concerned actors are critical in this regard. Experiences from past crises have demonstrated that avoiding trade-restrictive measures can be equally important to direct forms of support to consumers and producers. Following international guidelines on safe travel and trade corridors can help keep agri-food supply chains alive, mitigate food supply disruptions, and promote food security. Concrete best practices include: 1) To ensure sufficient domestic food supplies policy should avoid export restrictions, particularly by major exporting countries, and pre-emptive expansion of stock procurement, particulary where stocks are already high. Thereby, international market transparency and governance mechanisms should be strengthened. 2) To ensure safety of food supply, blaket import restriction should be avoided. Instead safe travel and trade corridors should be enables. 3) To promote domestic production nd/or protect farmer incomes, careful design of programmes providing productive safety nets should be ensured. Moreover, direct benefit transfers to farmers should be provided where possible. 4) To contain rising consumer prices, there should be lower tariffs and taxes on imported food, but avoid stockpiling imported food, particularly where world stocks are high. Careful design of price control measures should be ensure, if used, in partnership with private sector.

Curated from fao.org