Madrid: Soaring prices for food staples, especially for rice which have tripled over the past year, could lead to social unrest in Asia, Japanese Finance Minister Fukushiro Nukaga warned today in Spain.
"The recent hike in the price of rice will hit Asan countries particularly hard. The ones who are most affected are the poorest segment of the population including the urban poor," he said at a meeting of the Asian Development Bank.
"It will have a negative impact on the living standards and also affect their nutrition. Such a situation may lead to social untrust and unrest and therefore safety nets addressing the immediate needs of the poorest are needed," he added.
Prices for the benchmark Thai variety of rice, a food stable across much of Asia, are at about 1,000 dollars a tonne, up threefold from the last ADB annual meeting held in Japan one year ago.
Global food prices have nearly doubled in three years, sparking riots last month in Egypt and Haiti, protests in other countries and restrictions on food exports in Brazil, Vietnam, India and Egypt.
Nukaga warned that export restrictions lead to higher prices while food subsidies to help the poor deal with surging prices could place a tremendous burden on state budgets.
"Export restrictions will no only distort the proper functioning of markets in price formation but further exacerbate the price hikes in international markets," he said.
"Subsidies that are intended to keep food prices under control have the risk of becoming a significant burden to budgets and and not sustainable over time," he added.
