April 20, 2011

Relax biofuel laws says World Bank as millions face food poverty

FROM-Green Car Web Site

The World Bank is calling on Governments around the world to relax laws requiring biofuels to be mixed with conventional fuels for road transport use as global food prices remain volatile.

According to the organisation, rising food and fuel prices is causing unrest in some of the world’s poorest countries as more people face being pushed below the $1.25 daily income extreme poverty line.

Driven in part by higher fuel costs connected to events in the Middle East and North Africa, global food prices are 36 per cent above their levels a year ago new World Bank Group numbers released this week reveal.

The bank is calling on governments to divert more crop production away from biofuel use and ease export controls to prevent even more people falling below the extreme poverty line.

“More poor people are suffering and more people could become poor because of high and volatile food prices,” said World Bank Group President Robert B. Zoellick. “We have to put food first and protect the poor and vulnerable, who spend most of their money on food.”

The World Bank says that a further 10 per cent increase in global food prices would push a further 10 million people below this line. This is in addition to the 44 million people who have been driven into poverty since last June as a result of price spikes. The World Bank estimates there are now about 1.2 billion people living below the poverty line.

The World Bank’s food price index, which measures global prices remains close to its 2008 peak. While not suggesting that biofuel laws should be abolished altogether, the organisation is concerned that many of the greatest food price increases link to plants commonly used as biofuel sources. Crops such as maize show a 74 per cent increase in price, while other biofuel crops such as wheat show a 69 per cent increase and soybeans show a 36 per cent increase, although rice prices have been stable.

Food prices have soared due to severe weather events in key grain exporting countries, export restrictions and low global stocks as well as biofuel production. The food price hike is also linked to surging fuel prices – crude oil increased 21 per cent in the first quarter of 2011as a result of unrest in the Middle East and North Africa.

In Europe, the European Renewable Energy Directive states that 10 per cent of transport fuel must come from renewable sources by 2020. In the UK a similar measure requires 5 per cent of transport fuel to come from renewable sources by 2013-much of this is currently met through the use of biofuels.

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