FAO warns about true cost of corporate food systems

A new FAO report warns against the high hidden economic and health costs of the world’s food systems, adding up to around USD 12 trillion in PPP terms, which is about 10% of the global GDP. These costs involve environmental damage, contributing to social inequalities, and harming human health

November 08, 2023 by Peoples Health Dispatch

A new report by the Food and Agriculture Organization (FAO) warns about the very high hidden costs of current food systems. According to the United Nations agency, in 2020, these hidden costs added up to at least USD 12.7 trillion in purchasing power parity dollars, which is about 10% of the global GDP. These costs involve environmental damage, contributing to social inequalities, and harming human health.

In the report, the FAO provides examples of how the current food production system causes water pollution and deforestation, which harms the planet. It also shows how food systems impact health in both low- and high-income countries. In low-income countries, hunger is a major health issue, but environmental changes can also lead to new diseases. In high-income countries, the direct effects of unhealthy diets are a significant concern, but this can’t be addressed without considering food prices and subsidies for healthy food.

Read more: The Junk Push: ultra-processed food industry gains ground in India

As a result, the FAO recommends a significant shift in how we think about food systems. The organizations suggests prioritizing access to healthy food by reducing the cost, regulating marketing practices, and implementing stricter labeling and certification standards. Additionally, food policies should be tailored to local contexts to make the most of available resources, says the report.

For example, in Latin America and the Caribbean, the report suggests that redirecting fiscal subsidies to support healthy diets and changing tax subsidies could make healthy diets more affordable. This approach may vary in other regions to address local priorities.

While the report acknowledges the problems with current food production practices, it doesn’t adequately address the role of the food industry. Many experts have raised concerns about the aggressive behavior of major food companies, similar to what was seen with Big Tobacco. Despite these concerns, governments and the FAO have not taken decisive action to break ties with food corporations, often choosing voluntary measures over stricter ones, like taxing ultra-processed foods.

Read more: Tackling malnutrition in an era of political uncertainty: the case of Brazil

Instead of introducing voluntary measures to reduce the consumption of unhealthy food, or at least warn about the risks it implies, corporations have repeatedly questioned evidence-based food policies and pushed against attempts to regulate their presence, as recently experienced in Australia. In order to build different food systems, much more radical steps need to be taken. A recent example of how this can happen comes from Colombia, where a new law is introducing higher taxes on food with high levels of unhealthy ingredients.

Unsurprisingly, the initiative was heavily criticized by the food industry, yet public health experts remain optimistic, quoting evidence from other Latin American countries, where similar interventions have helped reduce the consumption of specific ultra-processed foods.

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