Agricultural support and vulnerability of food security to trade in developing countries

Our hypothesis is that the ratio of national food import expenditures to the value of total exports may be used as a consistent indicator of food security vulnerability to trade at the national level (the Bonilla Index hereafter). In this article, we test the assumption that with the aim of stabilizing national food availability and accessibility, developing countries use policy instruments for stabilizing their Bonilla Index. Developing countries depend on farming while many price distortions remain. The nominal rate of assistance is defined as the percentage by which government policies have raised revenues to producers above what they would be without the government's intervention (agricultural policy domestic support and border measures). After analysing the role of the nominal rate of assistance and of the exchange rate vulnerability of food security to trade, we present the Bonilla Index evolution paths of 39 developing countries from 2005 to 2010. Second, we measured the impact of their national policy responses to the 2008 price surge using the nominal rate of assistance on importable food products. Finally, we statistically tested the extent to which our qualitative hypotheses and relationships were actually confirmed by the data over the period 2005-2010. Our results suggest that most developing countries have used their possibility to play with the nominal rate of the assistance level to compensate for the effects of the 2008 food price surge and that exchange rate variations actually have little impact on food accessibility for consumers in a context of food-price volatility.