High Food Price Impact Assessment and Analysis - WFP Remote ...

II.
From int’l to domestic food prices
Transmission is larger if:
Risk = hazard x vulnerability
o Not one-for-one relation
o Relationship depends on policies
o Food imports as % of domestic supplies
are larger
o Transportation costs are lower
o Trade barriers are lower
o Exchange rate is depreciating
o Food taxes & subsidies are reduced
o Hazard = Price increase
o Vulnerability:
• Government response capacity
• Imports as % of consumption
• Foreign exchange reserves
• Existing socio-economic conditions
7
o Markets are more competitive 8
9
Vulnerable countries
III. From int’l to national to household
Vulnerability at household level:
o High % of income spend on food
o Buy more food than sell (net-buyer)
o Few coping mechanisms
High
vulnerability
Low
vulnerability
10
11
12
26