World food prices close to record

7 July 2011 Last updated at 10:57 GMT Asia Business Report's Sharanjit Leyl says governments need to look at ways to increase production

Global food prices rose sharply in June, according to the UN Food and Agriculture Organisation (FAO), after a steep increase in the price of sugar.

The price of sugar rose by 14% last month, as a result of high demand and lower production in Brazil.

The FAO's food price index reached 234 points in June, close to February's record level of 239.

The sugar price rise fuelled most of the increase, cancelling out falls in prices of wheat, corn and soya.

The FAO's measure looks at a range of essential foods, including cereals, oilseeds, dairy, meat and sugar.

High food prices - particularly those of wheat, rice and corn - have sparked civil unrest in a range of countries where people rely on them for the bulk of their food intake.

They were one of the factors that drove people on to the streets of Arab countries earlier this year.

A global food crisis in 2008 also triggered mass protests, including riots in some developing countries.

World cereal output is forecast by the FAO to be 3.3% higher in 2011-12 than in the year before.

The agency's most recent bi-annual Food Outlook said that spiralling demand meant that global food prices would remain high and volatile throughout this year and into next despite record food production.

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Fifa alters World Cup vote system

Sepp Blatter: "I am the ship's captain"

Fifa president Sepp Blatter has announced that World Cup host countries will in future be chosen by a vote of all the 208 member associations.

Until now, Fifa's 24-man executive committee has made the choice.

But the controversy surrounding the decision to award Russia the 2018 tournament and Qatar the 2022 event has prompted a change.

"I want to give more power to the national associations," said Blatter, who was re-elected on Wednesday.

"In the future, the World Cup will be decided by the Fifa congress. The executive committee will create a shortlist - but will make no recommendations, only a list - and the congress will decide on the venue."

A frenetic week of claim and counter-claim has seen Fifa's reputation seriously damaged.

But Blatter insists that any problems can be solved in-house and with him in charge.

"The Fifa ship is in troubled waters but this ship must be brought back on the right track," he added.

"I am the captain of the ship. It is therefore my duty and responsibility to see to it that we get back on track.

"Reforms will be made and not just touch-ups but radical decisions. We have made mistakes, but we will draw our conclusions.

"We have been hit and I personally have been slapped. I don't want that ever again.

"We must stop once and for all, all these ugly criticisms, allegations, insinuations of cheating left, right and centre."

Blatter, who has been in office since 1998, made an appeal for unity after a bruising period of public division.

"I hope that you will follow the path that I'm trying to change on this ship," added Blattter.

"We must know where we're going with our game to build a better future.

"Together we can do it, together we will get there, and together Fifa will once again find its credibility."

Blatter also said the chairman of the ethics committee - the watchdog group set up in 2006 to deal with claims of malpractice in Fifa - would in future also be elected by congress and suggested a committee would be set up to examine Fifa's corporate governance.

The 75-year-old was the only candidate in the presidential vote after his sole challenger, Mohamed Bin Hammam, withdrew from the contest last weekend.

The Qatari executive committee member was suspended on Sunday amid allegations of corruption, including claims he "bought" the 2022 World Cup for Qatar. He denies any wrongdoing.

On Wednesday, Football Association chairman David Bernstein called on the member associations to stop Blatter being re-elected unopposed but they voted by 172 votes to 17 not to postpone the election.

Among those who backed Blatter's re-election was Cyprus Football Association president Costakis Koutsokoumnis.

"In difficult times, Fifa needs a strong mandate," said Koutsokoumnis. "To do that it needs a strong leader and a strong president so we can move forward.

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We are confident the FA has played a significant role as a catalyst for change in the way World Cup hosts will be selected in the future

FA chairman David Bernstein

"It is my opinion that we should support Mr Blatter. He has done it before. We should support him to do it again. And it's now the time to show the solidarity that is needed for football to go forward."

Despite the lack of support for the FA's demand to postpone the presidential election, Bernstein insisted the organisation's stance had been "worthwhile".

"We are confident the FA has played a significant role as a catalyst for change in the way World Cup hosts will be selected in the future," he said in a statement released after the vote had been taken.

"This must be a more open transparent process."

In a separate development, the head of Germany's football federation, Theo Zwanziger, has called on Fifa to re-examine the awarding of the 2022 World Cup to Qatar.

"I think there is a significant degree of suspicion that one cannot just dismiss," he told German television.

"And that is why I reckon that the awarding of this World Cup must be re-examined with regard to these concerns."

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World Bank: $6bn for North Africa

24 May 2011 Last updated at 16:10 GMT The World Bank move is explicitly aimed at bolstering the Arab Spring democratic revolutions The World Bank has pledged $6bn in loans for Egypt and Tunisia in a move explicitly to bolster the Arab Spring.

Egypt, which will receive $4.5bn over two years, is also speaking to the International Monetary Fund (IMF).

Meanwhile, Qatar has offered to make up to $10bn in investments in Egypt.

It comes after the European Bank for Reconstruction and Development - set up to aid post-Communist Eastern Europe - said at the weekend it would start lending to emerging Arab democracies.

Egypt and Morocco had already applied to the EBRD for financial assistance.

But while the lender said it hoped to provide up to 2.5bn euros a year to the region eventually, any such wholesale geographic reorientation of its mandate would need the approval of its 63 members.

Funding gap

Like the EBRD, the World Bank explicitly stated its desire to support the Arab Spring of democratic revolutions.

"Our support, and that of others, can sustain momentum and accelerate progress, but only if coupled with real reform," said Robert Zoellick, World Bank president.

The World Bank money will be made conditional on the countries' progress in modernising their economies.

Tunisia - which was the first country to oust its former dictator - will receive $1.5bn from the international lender, of which $500m is part of a previously-announced $1.2bn package put together with the African Development Bank and European donors.

Two tranches of $1bn, to be provided directly to the Egyptian government this year and next, would be linked to "governance and openness reforms".

The other money would be provided in other formats, such as guarantees, private business loans and infrastructure financing.

Egypt's financing needs are daunting, thanks to a collapse in the economy - notably the tourism industry - triggered by the recent political turmoil.

Elevated demands of the people after the revolution were adding to pressure on the budget, Finance Minister Samir Radwan told the BBC earlier this month.

The country expects to run a deficit of 9-10% of economic output in the coming year and faces a financing gap of $10bn-12bn, which it has already formally applied to the IMF to help plug.

Gulf support

Qatar's planned investments in Egypt are expected to be consummated during a visit to Egypt by Qatar's emir this Saturday.

"I believe these projects, when implemented, will surpass $10bn and they will be productive products in Egypt," said the Qatari ambassador, Saleh al-Buainein.

The emirate may also buy up Egyptian government bonds in order to help fund its deficit.

It comes after the US and Saudi Arabia offered the new Egyptian government financial support.

The US said it would cancel $1bn in debts and provide a further $1bn in loan guarantees to support infrastructure finance.

Meanwhile, Saudi Arabia has offered a $4bn aid package.

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