Food Security in the Arabian Peninsula
Eckert Woertz, Thomas Lippman, Oliver Wilcox, Christopher Boucek
Food security is fast becoming a critical issue for countries in the Persian Gulf, many
of whom face tighter global food markets because of trading partners’
strained export surpluses, a decline in domestic food production, and population
growth. Wealthier countries on the Arabian Peninsula, fearing that some day they
might not be able to secure enough food for their populations, have increased
government subsidies, built up strategic storage, and invested in agriculture
overseas.
Eckert Woertz, of the Gulf Research Center in Dubai, discussed the Gulf food
security predicament and evaluated the current initiatives of the Gulf Cooperation
Council countries. He was joined by the Council on Foreign Relations’ Thomas
Lippman, who commented on Saudi Arabia’s controversial "food security initiative,"
which aims to produce food in underdeveloped countries for consumption by the
fast-growing population of Saudi Arabia. Carnegie’s
Christopher Boucek moderated.
The Problems
According to Woertz, food security in the Gulf increased in importance in 2009, as
the world saw a big commodity boom and food cost hikes, coupled with an
increase in export restrictions by trading partners. Even as the cost of food supply
from outside the region rose, local supply has been falling and regional
demand has been rising.
• Demand: 60 percent of food is already being imported in the Gulf. Meanwhile, the
population of the Gulf is
increasing; between 2000 and 2030, it is expected to double.
• Local Supply: Water used for irrigation comes from ancient aquifers and is
non-renewable. Saudi Arabia, for example, was
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a net wheat exporter in the 1980s and 1990s, but it cannot sustain its irrigation. By
2060, the desert will
have reclaimed the farmland where wheat was once grown.
• Costs of Imports: There has been a rise in export restrictions on food by major
trade partners, who are concerned about their
own food security.
The Solutions
Gulf nations have sought to stimulate food production in countries that have
sufficient water and irrigable land, to support the growing Gulf population.
Countries hosting Gulf investments range from Sudan, Pakistan, and Ethiopia, to
the Philippines, Kazakhstan, Thailand, and Tanzania. In these nations, Gulf
countries have generally purchased land and provided the capital to increase food
production using the host countries natural resources.
The Gulf countries now depend on four main sources for food production:
1. The new initiatives in developing countries, where Gulf nations can use their
investment abilities more aggressively. Woertz referred to these
sources as having the classical colonial agro-export and food import dependencies.
2. Emerging developing countries, such as Brazil, South Africa, Thailand, Argentina,
who cannot afford to subsidize their national agriculture and are
therefore at a disadvantage when selling to global markets.
3. Large suppliers that subsidize food production within their own borders, such as
the United States and the European Union.
4. Production within their own borders.
The available water sources in the Gulf are limited. Woertz pointed to an article in
Foreign Policy that suggested that the initiatives to buy land in underdeveloped
countries are in fact attempts to purchase water resources, not land resources.
He warned that what is happening on the ground is not clear; the full motives of
the Gulf investors cannot yet be determined.
Saudi Arabia
Lippman assessed the agricultural sector in Saudi Arabia, as well as the Saudi
perspective on the drive for agro production in other countries. He described how
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the socio-political problem of inflation, coupled with food shortages and drought,
has spooked the Saudi government and led to changes in their agricultural policies.
One significant new policy has been a food security initiative, where Saudi
industries would use their capital to bring resources and technology to countries
that can’t afford them. The Saudi government argues that the relationship benefits
both parties; if Saudi investors quintuple the food output of these
countries, the host country would have more agriculture revenue and food for itself
and they could increase exports to Saudi Arabia. The Saudi government
compares the venture to the West’s investment in oil. Lippman explained that the
initiatives are actually joint ventures between the host governments and private
sector Saudi Arabian organizations.
Potential Issues with Food Security Initiatives
• Woertz pointed out that there has been some opposition to these initiatives within
potential host countries. Thailand has declared that there
would be no land sales to the Gulf countries, and farmers in Kenya and Pakistan
have voiced opposition to the proposed deals with Gulf countries.
• Lippman described the potential for conflict over scarce resources outside the
Gulf. International tension might occur, for example, if Saudi Arabia,
Kuwait, or the UAE sought to build large agro-projects in Sudan, which shares its
water source, the Nile, with Egypt.
• Tensions might also occur between agricultural producers within the Gulf and
their own governments. Saudi Arabia, which has long been proud of
its food production self-sufficiency, is a prime example of this potential area for
conflict. Agriculture is a big business in Saudi Arabia. There are
huge agricultural projects in the deserts, where the Saudis grow alfalfa and
vegetables and maintain dairy farms. In 2000, 5 percent of Saudi Arabia’s GDP and
12 percent of its labor went towards agriculture. Strong elements within Saudi
Arabia oppose the new food security initiatives.
These elements are either agro-business entrepreneurs who believe that the
country should significantly increase its local investment, or others who worry about
the risk, wondering who would ensure the ensuing contracts with other
governments.
Carnegie Endowment for International Peace
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