Mexican food crisis – new policy won’t lower cost

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In response to rising global food prices, Mexican President Felipe Calderon announced on Sunday that he will eliminate import taxes on wheat, rice, white corn and yellow corn.

Counter to the policies many other countries are adopting that would strengthen the ability of local farmers to meet demand, Mexico’s move would adjust high food prices by primarily looking to foreign suppliers.

Victor Suarez of the Mexico-based National Association of Rural Producers’ Enterprise agrees that Mexico needs to address the problem of high food prices, but he says that the lifting of import taxes is not the solution. He argues instead, that domestic production should be encouraged.

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Story Transcript

REKHA VISWANATHAN (VOICEOVER): In a response to the global food crisis, Mexican President Felipe Calderón announced on Sunday that he will eliminate import taxes on certain agricultural products.

FELIPE CALDERÓN, MEXICAN PRESIDENT (SUBTITLED TRANSLATION): All taxes on wheat, rice, white corn and yellow corn will be eliminated. We want those basic products to be brought to Mexico, from any part of the world at the best price for Mexican consumers.

VISWANATHAN: Counter to the policies many other countries are adopting that would strengthen the ability of local farmers to meet demand, Mexico’s move would adjust high food prices by primarily looking to foreign suppliers.

CALDERÓN: In the last few months, the entire world has registered a strong increase in the prices of many food products. Like never before, what happens around the world has an impact in Mexico.

VISWANATHAN: Victor Suarez of the Mexico-based National Association of Rural Producers Enterprise agreed that Mexico’s feeling the impact. But he argued that the lifting of import taxes is not the solution.

VICTOR SUAREZ, ANEC (SUBTITLED TRANSLATION): It’s useless in reducing prices, because food prices are so high all around the world.

VISWANATHAN: Suarez said that the government was sidelining domestic production by not developing local agriculture adequately. He added that the removal of the import tax will increase Mexico’s reliance on foreign goods and the companies that produce them.

SUAREZ: In Mexico, no more than twenty Mexican and multi-national corporations control the food market, and they impose uncompetitive prices and make tremendous profits. President Calderon doesn’t want to touch their profits, and he forces the farmers to undervalue their goods, to reduce their incomes, to leave farming, and emigrate to the US and Canada.

VISWANATHAN: The cost of consumer goods in Mexico has jumped by over four percent within the last year. In early 2007, the price of tortillas rose by 400 percent within three months, prompting thousands of Mexicans to take to the streets in protest of President Calderón’s trade policies.

DISCLAIMER:

Please note that TRNN transcripts are typed from a recording of the program; The Real News Network cannot guarantee their complete accuracy.