Wrong response aggravates Asia food crisis: ADB report

Export bans and price floors imposed by grain exporters including China, Pakistan, Vietnam and India "have increased price volatility and uncertainty in the international rice markets," reducing supplies.

These have been "contributing significantly to the surge in rice price especially since the end of 2007," the Manila-based lender was quoted by AFP as saying.

Among the importers, "precautionary demand for food stocks in many countries is contributing to food grain price increases," said the report, which cited "sustained procurements" in international markets by Bangladesh and the Philippines.

The report, "Soaring Food Prices: Response to the Crisis," said "strong political and economic factors " were at play in the food policies of most developing Asian countries, "so that the effect of sharply higher international prices has not been fully transmitted to domestic prices."

The bank said crackdowns by Dhaka and Manila on private traders accused of hoarding food grains were "difficult to implement" and have in fact "increased prices in the domestic market of many countries."

The report also said the "lack of efficient logistics systems and infrastructure for food grain marketing and distribution" has "tightened the market further" in Afghanistan, Bangladesh, Nepal, the Philippines, and
Tajikistan.

The bank announced at its annual meeting in Madrid earlier this week that it will provide 500 million dollars in immediate assistance to member nations hit hardest by soaring food prices.

Longer term ...