World Bank Debuts Tool To Fight Food Price Swings
Poor farmers in the developing world will now be able to use Wall Street-style financial wizardry to protect against food price volatility (vilde udsving), under a new program announced by the World Bank Tuesday.
The Washington-based development lender said it was launching a new risk management product to provide an initial 4 billion US dollar (20 milliarder DKR) in protection from volatile food prices to farmers and consumers in developing countries.
– With this new tool, we can help farmers, food producers, and consumers protect themselves against price swings, strengthen their credit position, and increase their access to finance, World Bank President Robert Zoellick said.
The deal, struck with the investment bank JPMorgan, comes as countries such as China and India weather (kæmper med) a second surge in agricul-tural commodities prices following the 2007-08 food crisis.
Zoellick said that the “agriculture price risk management” tool showed what “sensible financial engineering” could do.
The facility will target the private sectors of developing nations, including farming co-operatives and food processing companies. JPMorgan would offer simple hedging instruments.
Safeguards have been put in place to prevent the program from being used for speculation and to ensure that participants do not bet on their own failure, according to a World Bank official.
The program will initially be focused in Latin America and Southeast Asia, where JPMorgan’s presence is strongest, but the Bank is in discussions with other lenders to expand the program to Africa and the Middle East.
Se også udbygget omtale på
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:22945434~pagePK:34370~piPK:34424~theSitePK:4607,00.html
Kilde: Verdensbanken
