68 CHAPTER 3


our above analysis, which emphasized the lack of any counteracting effect from favorable exchange rate movements with the U.S. dollar. In Africa the story is complex. A few countries witnessed declining real prices, such as Cameroon, Madagascar, South Africa, and Zambia (whose strong currency might have affected the cost of imports). However, many countries experienced steep price changes in 2008, including some of the most populous countries, such as Ethiopia, Ghana, Kenya, Mozambique, Nige- ria, Senegal, and Sudan. In some cases, domestic factors were undoubtedly important (for example, monetary factors in Ethiopia or conflict in Kenya and Sudan). In some instances these factors spilled over into tighter food markets in neighboring countries, such as Uganda.


The results in Figure 3.4 should be treated with caution, but they do seem to be broadly consistent with other evidence.2 In a study of seven Asian economies, Dawe (2008) found that transmission rates of rice and wheat prices were generally low in Asia. In India, Philippines, and Vietnam the pass- through was just 6–11 percent, but in the remaining countries it was 41–65 percent. However, as our data suggest, several South Asian countries seem to have been more affected than were East Asian countries and India. Dawe (2008) finds that Bangladeshi international wheat prices were fully transmit- ted into Bangladesh (albeit mostly in 2007). Ul Haq, Nazli, and Meilke (2008) find that Pakistan’s food CPI increased by 14.4 percent from 2006/07 to 2007/08, which is more than twice that of the nonfood CPI. For Latin America there is not much data updated beyond early or mid- 2008. The International Development Bank (see Cuesta and Jaramillo 2009) reports food price inflation for Latin America countries from January 2006 to March 2008. These data suggest large nominal increases (greater than 25 per- cent) in Bolivia, Costa Rica, Guatemala, Guyana, Haiti, Honduras, Jamaica, Nicaragua, Paraguay, Trinidad and Tobago, Uruguay, and Venezuela. For Mexico during a similar period, Valero-Gil and Valero (2008) find larger nomi- nal food-price changes than would be suggested by Mexico’s food price index (which rose by 13 percent of 2006 to March 2008): most food prices increased by about 15–30 percent, such as those for beans (26 percent), chicken (32 percent), and tortillas (20 percent), but larger increases were observed for eggs (63 percent) and vegetables (80 percent), and much lower increases (less than 10 percent) for beef, milk, sugar, and tomatoes.


For Africa, other evidence is mixed. Data for Uganda (Benson et al. 2008), Ghana (Cudjoe et al. 2008), and Mozambique (Arndt et al. 2008) are quite consistent in finding moderate, large, and very large changes, respectively.


2 Demeke, Pangrazio, and Maetz (2009) provide an overview of price increases across developing regions based on the same GIEWS data.


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