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New Texts Out Now: Eckart Woertz, Oil for Food: The Global Food Crisis and the Middle East

[Cover of Eckart Woertz, [Cover of Eckart Woertz, "Oil for Food: The Global Food Crisis and the Middle East"]

Eckart Woertz, Oil for Food: The Global Food Crisis and the Middle East. New York and Oxford: Oxford University Press, 2013, paperback edition 2015.

Jadaliyya (J): What made you write this book?

Eckart Woertz (EW): In 2007-08, at the height of the global food crisis, I was living in Dubai, working for the Gulf Research Center. Food price inflation became a hot topic, and in 2008 Gulf countries started to make all these announcements about agro-investments in food-insecure countries like Sudan and Pakistan. So it was an intriguing topic to deal with and it tied into other topics such as development issues, management of sovereign wealth fund assets, heavy reliance on oil revenues, and domestic economic diversification.

After writing two reports with the current-affairs perspective of that time, I came to realize how much historical baggage informs a sense of vulnerable food security in the region. During World War II, famines in the Gulf were only averted by food supplies of the Allied Middle East Supply Center in Cairo, and in the seventies, the US contemplated a food embargo in retaliation to the Arab oil boycott. Gulf countries reacted with a grandiose plan to develop Sudan as an Arab breadbasket. It failed, yet the current large-scale project designs are in many ways reminiscent of these past failures and have not been implemented in most cases.

So there I was with pretty much a no brainer: The Middle East is not only the world’s largest oil exporter, but also its largest food importer, and it pays for most of these food imports directly or indirectly with oil revenues. My time as a visiting fellow at Princeton University provided me with the opportunity to write a book about the issue and add fieldwork in Sudan and archival studies to the material that I had collected in the Gulf. In general, I also feel that the MENA could do with more studies that take a political economy perspective instead of focusing too much on regional exceptionalism, culturalistic micro-studies, Islamism, and hard security issues.

J: What particular topics, issues, and literatures does the book address?

EW: The book tries to explain how Gulf countries have reacted to the global food crisis in a broader Middle Eastern context and against the backdrop of their domestic political economy.

A historical part deals with the relationship between agricultural modernization, clientelism, and US assistance that culminated in the subsidized wheat schemes in the desert in the 1980s and 1990s. For that part I benefitted a lot from previous work by Robert Vitalis, Toby Jones, and Steffen Hertog.

Then I deal with the whole oil-for-food diplomacy, especially of the 1970s, and try to engage with related International Relations literature, like David Spiro’s great book on petrodollar recycling. The role of Sudan for Arab bread-basket phantasies was quite an eye opener for me and it was fascinating to analyze how successive Sudanese regimes have tried to capitalize on this. John Waterbury’s work on hydropolitics along the Nile, Tony Allan’s “virtual water” paradigm, and the works of Harry Verhoeven and Alex de Waal on Sudan have helped me a lot to understand these issues better.

Finally, I try to engage with the development and land-grab literature. Gulf countries have been among the most prominent land investors beside the Chinese and Western financial institutions. There has been an increasing number of studies about target countries, so I wanted to contribute a study about the investing countries.

There is a huge gap between media reports and actual investments on the ground. Deborah Brautigam has observed the same for Chinese investors in her new book. I try to explain this gap; the lack of infrastructure, governance issues, misguided project designs, and lack of finance all contributed to it. In contrast to some media perceptions, it is not Africa or other developing countries that feed the Middle East. Most food imports still come from the grain livestock complexes in developed countries that emerged during the second food regime after World War II. However, Pakistan and India dominate the basmati rice exports to the Gulf and there are a number of new players from tropical countries, especially Brazil. When Gulf countries have really put money on the table, it has been rather in developed agro markets and it has been in value chain investments rather than in actual land. They have for example invested in commodity trading houses like Glencore or the former Canadian Wheat Board and have expanded their strategic storage capacities.

J: How does this book connect to and/or depart from your previous work?

EW: After my PhD about labor unions in Egypt, I joined the forces of darkness and worked for seven years for banks in Germany and the UAE, thinking I would never return to academia. So I am a bit of a hybrid academic. Maybe my banking experience has helped me to better understand some of the involved financial issues and with a non-ivory tower perspective. There are also a lot of connections to Gulf economic issues such as energy and economic diversification, which I have studied during my Dubai years. The topic of food security and development is quite old, but was very forgotten during the commodities slump of the 1980s and 1990s, so I wanted to put it back on the map as far as the Gulf and the wider Middle East are concerned. I also do not see it disappearing. Climate change, population growth, and excessive meat consumption pose severe challenges to an unsustainable global food system. On the other hand, self-sufficiency is not an option in the arid Middle East; the Saudi wheat schemes even had to be phased out, as fossil water aquifers have run dry.

J: Who do you hope will read this book, and what sort of impact would you like it to have?

EW: Academics who are interested in the political economy of the Gulf region, food security, and the land-grab debate are one intended audience. The book is written in an accessible style, so I hope that practitioners in governments, media, banks, and international organizations who deal with contemporary food security and energy issues find it interesting as well.

The book might help to call more attention to food security issues in Middle Eastern studies. It would be terrific if it provided some perspective to Gulf countries and lured them away from their self-sufficiency obsessions, real-estate-centered mentality, and related project designs. The book also corrects some of the misleading exaggerations that have been present in the land grab debate, but I hope that I have paid due attention to the important issues that this debate has raised.

J: What other projects are you working on now?

EW: I co-edited a special issue in the International Journal of Water Resources Development on the Water-Energy-Food Nexus in the MENA and another one in Food Security on MENA Food Trade Relations with Tropical Countries, such as Brazil. In an article in Third World Quarterly, I have dealt with the mining industry of the MENA and corresponding diversification strategies, especially in the Gulf, Iran, Turkey, and Morocco. Fertilizers from phosphates play a crucial role in the global food system, and I find it fascinating that the MENA’s dominance in global reserves is even more pronounced than for oil. In a recent article in International Development Policy, I have analyzed with Martin Keulertz the role of the state in agro-investments in comparative perspective, taking a look at other countries beside the Gulf, such as China and Russia.

Currently I have a Marie Curie grant from the European Commission for a project about food security and political stability in Iraq. For the contemporary part, I have conducted an online survey and fieldwork in the Kurdistan Region of Iraq, and Hadi Jaafar and I analyze food production in ISIS territory with the help of satellite imagery. For the historical part, I analyze the political economy of food during the embargo period of the 1990s, using the Iraqi newspaper archive at the University of Marburg and the Iraqi archives that were at the National Defense University in Washington and those that are still at the Hoover Institution at Stanford. Rami Zurayk, Rachel Bahn, and I are planning a book on “Agriculture, Conflict and Reconstruction”—globally, not just the MENA—so this research can address some of these issues in an Iraqi context.

At the American University of Beirut, I had the pleasure to develop a curriculum for a food security diploma, which we launched last summer, and at the Barcelona Institute for International Studies (IBEI) I am teaching a food security module in the newly-launched Master for International Development. So I am looking forward to develop more teaching material in that direction.

CIDOB does a lot of work on migration, so in light of the current refugee crisis, I could imagine doing work about the new diasporas in Europe from Syria, Iraq, Afghanistan, and Eritrea, how they relate to other diasporas, their home countries, and their new countries of residence. Rather than just writing another journal article about this, I would hope to include project-related work and activist journalism like my brother Tilman has done in his Peace Counts projects.

Finally, as you might know, the food over here in Barcelona is great. More long term, I would love to do something about the Mediterranean diet and the preservation of culinary traditions. I am still figuring out a way to justify fondness for olive oil and red wine academically, but I am confident I will succeed.

Excerpts from Oil for Food: The Global Food Crisis and the Middle East

The Food Weapon: Geopolitics in the Middle East

The food weapon has left a similar imprint on the collective unconscious in the Arab world as the oil weapon has in the West. Food trade has been used to further geopolitical goals, which has prompted desires for self-sufficiency. With Saudi blessings, Washington withdrew food aid under the Food for Peace Program to entice Egyptian policy changes in the 1960s. The politicization of food trade reached its pinnacle in the 1970s. The US contemplated grain embargoes against the Arab world and a grain cartel. Afterwards food trade was depoliticized and commercial considerations prevailed; however, Iraq saw the most sweeping application of the food weapon when it was exposed to a multilateral UN embargo during the 1990s. Arab fears resurfaced in the wake of the global food crisis in 2008, when agro-exporters announced export restrictions out of concern for their domestic food security.

Middle Eastern countries have shown a persistent preference for some degree of self-sufficiency in cereals out of strategic concerns. Dependence on fragile trade links and volatile global markets is seen with suspicion. In a world of international market liberalization under the WTO umbrella it may appear as a distant memory, but food has been an important aspect of warfare and a foreign policy tool throughout history, ranging from Napoleons Continental System to the German Hungerplan and the US naval blockade of Japanese held territories in World War II. The Middle East has not been an exception. In World War I Mount Lebanon was worst affected by the naval blockade of the Entente because its agriculture was export led and lacked cereal production.

Ibn Saud and other rulers in the Gulf were painfully aware of their fragile dependence on food imports during World War II. When the US contemplated a food embargo in retaliation to the Arab oil boycott in 1973, Gulf countries were prompted to develop Sudan as an Arab bread-basket. It also informed the Saudi wheat program that took off in the 1980s. Apart from strategic considerations, a degree of self-sufficiency has been advocated to preserve local farming traditions as they foster a sense of community and play a role in livelihoods of smallholders, ecological landscaping, and culinary traditions.

A trade-based approach to food security frowns upon this penchant for self-sufficiency and recommends specialization along comparative advantages instead. To make the best use of precious water resources the Middle East should focus on more value added crops like cotton, fruits, and vegetables, often for export. Water-intensive cereals on the other hand should be imported. As a lot of water is needed to produce them, they constitute virtual waterthat water scarce countries can access via food trade. Food security and accessibility would then need to be ensured by inclusive growth policies.

Yet, in the Middle East these policies have not materialized in the past as liberalization favored a few privileged cronies. Large-scale projects might lead to agricultural growth, while excluding rural poor from development at the same time. While logical on paper, the trade-based approach to food security tends to collide with these contradictions and the geopolitical threat perceptions that loom large in the region. Many Arab analysts have made the argument that the independent development of Arab states is only conceivable if vulnerability to food extortion can be eliminated. Military vocabulary pervades the talk about food security. Authors have seen the food weapon at play whether it is the second Gulf War or Israeli politics in the occupied Palestinian territories. Food self-sufficiency, Arab economic integration, and strategic storage have been regarded as means to cope with the dangers of a US-led grain cartel, the cut-off of preferential food aid, or an outright food boycott. Turki Faisal al-Rasheed, a well-known Saudi agro-businessman and commentator, sums up widespread concerns when he pleads that the Arab regions staple crops should be produced with Arab capital, Arab land, and Arab water,because food supplies can be threatened like oil supplies and Americas future weapon is wheat.

 […]

We Freeze, They Starve: Counter Threats to the Oil Embargo

The politicization of the food trade grew in magnitude in the 1970s. On several occasions, the US government implemented export restrictions, either to further political goals or in an attempt to reduce food inflation at home. In 1973, a food embargo was contemplated as a retaliation to the Arab oil boycott. A general soybean export embargo in 1973 and a temporary moratorium of grain sales to the Soviet Union and Poland in 1975 were meant to protect American livestock producers against rising feedstock prices and to keep food prices at home in check. President Ford was against the use of food embargoes as an outright foreign policy tool, however. When pressed to enact a grain embargo against the Soviet Union for its entanglement in the Angola conflict in 1976, he stressed the role of the US as a reliable supplier and refused. His adversary and successor Jimmy Carter, on the other hand, endorsed such measures against the Middle East or the USSR and employed a grain embargo against the Soviets in 1980 shortly after their invasion of Afghanistan.

The experience of food embargoes was sobering for the US. It was a story of redirected trade flows and lost market share for American farm products. Others like Australia, Argentina, or the European Economic Community happily picked up the slack and delivered food to the targeted countries. The latter chose to bear some negative consequences instead of changing their foreign policy. Meanwhile, American farmers were up in arms over lost income and exerted political pressure to stop the embargoes. The food embargoes also prompted agricultural production elsewhere and could lead to a lasting loss of market share. Japan and some Western European countries reacted to the soybean embargo with investments in Brazil, which turned the country into a major soybean exporter and competitor in a field in which US farmers had previously enjoyed a virtual monopoly.

This is strikingly similar to the production cuts of Arab oil producers and their oil embargo against the US and the Netherlands in 1973. The price hikes of the 1970s finally spurred oil production in the North Sea, the Gulf of Mexico, and Alaska and led to a reduced market share of OPEC. The embargoed US and the Netherlands continued to receive deliveries via third countries. Barring prevention of delivery by military means, an embargo cannot prevent supply of a fungible commodity. Insofar as supply shortages occurred, they were caused by an allocation and price control system in the US. The effect of the oil embargo was in some ways more psychological than real, at least in hindsight.

Still, it was a major foreign policy concern as long as it was in place. It prompted calls for use of the food weapon and was an important factor in the shuttle diplomacy of US Secretary of State Henry Kissinger in 1973-4 when he brokered the disengagement between Arab and Israeli forces. While the US was pushing for an early end to the embargo, the Arab stance was one of withdrawal to the 1967 demarcation lines. Kissinger has criticized perceived vacillations and stalling tactics on the Arab side. But despite all their differences, the tone of cables and exchanges between the US and Saudi Arabia was remarkably friendly. The Saudis stressed that it was not their sole decision to make. Hardliners like Syria and Libya effectively had veto power in what was essentially a pan-Arab affair. The Saudis argued that an end to the embargo was only a matter of time. They were even ready to break the embargo when the US asked them to supply oil to the US navy. Their only condition was that it would not be made public.

Not all exchanges were so conciliatory, however. We freeze, they starvebecame a widespread slogan in Washington. On 21 November 1973, Kissinger spoke about possible countermeasuresif the embargo was to continueunreasonably and indefinitely.This prompted a reply from the Saudi oil minister, Zaki Yamani, on Danish television where he said that Saudi Arabia would cut oil production by eighty percent in such an event. In a later interview with Business Week, Kissinger specified that military intervention in response to oil price hikes would be dangerous and inappropriate, but he would not rule it out in the case of some actual strangulation of the industrialized world.

The food weapon was contemplated as a possible retaliation. Congress enacted legislative changes that allowed for implementation of export controls if cooperative approaches failed. Kissinger commissioned a classified study about the vulnerabilities of oil exporters to food embargoes and Congress debated a food boycott as one of several counter-measures to the Arab oil embargo. However, like the most radical proposal of occupying Arab oilfields, it was rejected as impractical. In case of an occupation, Saudi oil minister Yamani told the study mission that Saudi Arabia would destroy its oilfields and the vulnerability of the vast network of pipelines and oil installations to sabotage was evident. As for food, the leverage of the US was asymmetrically lower. It was a large consumer with limited supply alternatives in oil, while the Gulf countries with their modest population size were a small consumer with ample opportunities to substitute US food deliveries. The US report argued that only a multilateral approach by all OECD nations would have a chance of success, but it deemed such an approach improbable given the lack of unity among oil-consuming countries in the industrialized world.

France was singled out as a likely breaker of a counter-embargo as it was on the Arab oil producers’ “friendly listand was exempted from cutbacks: To be effective, a counterembargo against the Arab oil states would have to be a multilateral effort involving a majority of the free worlds industrialized nations. However, the current state of disorganization and lack of cooperation among the countries of Western Europe, particularly the NATO alliance, and Japan in face of the embargo and production cuts, makes immediate chance for such an action remote. France, as an example…appears unilaterally to be making every effort to keep its Arab oil imports flowing. The study mission was able to see, firsthand, evidence of French-supplied foodstuffs to Syrian forces during the October war.

The Saudis were honestly astonished by threats of counter-measures to the Arab oil boycott. They felt that the US did not recognize their mediating efforts. At the height of the embargo Saudi Minister of State for Foreign Affairs Omar Saqqaf conveyed to the US ambassador that Saudi Arabia was disturbed by the concertedUS campaign against the Arabs and a deliberate distortion of their position. A few weeks later he complained to Kissinger about the violenceof the American reaction when initial promises to lift the embargo against the US by years end were not met and the OPEC summit in Tehran raised the posted oil price from $5.12 to an unprecedented $11.65.47 Although ultimately not implemented, discussions about a counter-embargo raised eyebrows in the Gulf countries. They shaped their Sudan bread-basket plans in the 1970s and efforts to achieve food self-sufficiency in the 1980s.

[Excerpted from Eckart Woertz, Oil for Food: The Global Food Crisis and the Middle East, by permission of the author. © 2013, 2015 Oxford University Press. For more information, or to purchase this book, click here.] 

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