Last year Sarawak imported RM4.4 billion worth of food while it exported only RM1.17 billion. Hence, the deficit in food trade balance is RM3.27 billion.
We, Sarawakians, however, get the entire economic idea the wrong way around when looking into ways to address the food deficit. Our concern is unwarranted.
We don’t realise that Sarawakians actually benefit from the import of food because import is the very point and purpose of all trade.
We should be able to get to grips with this basic concept, as David Ricardo pointed out 200 years ago, to gain access to those lovely food imports, imports being the things those foreigners can produce better, or cheaper, or in greater volume, than they can be produced domestically.
The rise in food imports is the very thing which shows that Sarawakians have become better off. We all understand this instinctively in our own lives.
For example, the reason I “import” goods from a supermarket into my household is because my family becomes way better off doing so. I get a great variety of food, cheaper than if we tried to grow it all ourselves. My exports are simply the grunt work I do in order to purchase them.
If actions speak louder than words, we should look at what our policymakers do when managing their own affairs, not the affairs of the state.
It demonstrates Adam Smith’s insight in his 1776 classic, The Wealth of Nations: “What is prudence in the conduct of every private family can scarce be folly in that of a great kingdom.”
If we get into more details and rethink carefully, we would conclude that the value of food import gained by Sarawakians was RM4.4 billion greater than the value of RM1.17 billion food export gained by foreigners. It is actually a surplus, isn’t?
But the policymakers’ response is to reduce food imports. The puzzle is: Does action against food imports mean lower export? They really believe that it is those exports which make us richer.
This gets compounded by the silly suggestion that we should import less and export more, which is simply isn’t correct because in what world is it good to get less while giving up more in exchange? It doesn’t work as a piece of basic logic, does it?
Importing fewer foods ultimately must result in the sale of fewer food exports.
We should not try to protect domestic producers. We should be trying to advance the interests of consumers, only and always. Who is it that benefits from imports and from cheaper food if not consumers?
Cheaper food is good for consumers. It allows food to get cheaper and we have more money to spend on other things.
Who would have thought that China, the world’s largest rice producer and once was largely able to feed itself, now imports rice from the US where hurricanes, wildfires and floods rage across the country every year?
Look around us. We are abundantly fed compared to many decades ago. There is so much rice being sold – different kinds of imported rice, almost everywhere than at any time in the past. So it is simply ridiculous that we want to reduce food imports.
Of course we need to recognise the need for food imports which can only be produced in different climates and environment.
What we should be doing is maximising on food production we are good at, and looking at the potential for this.
The question becomes, how are we going to work out what food production we are good at?
The obvious answer is for us to abolish all subsidies, regulations and price control that help and protect our producers.
Those foods we are good at producing will continue to be produced and those foods that we’re not will not.
If foreigners do the cow farming better than we do, then we positively desire to be buying what they do better than we.
Some critics will say there will be less of that particular food around; we need some method of allocating that less. This is why we have a price system.
The most obvious method being that those willing to pay for that domestic production get it – exactly what a price rise does for us.
Those meat prices fall before they rise – a very common event in the market which will tell us that our entrepreneurs must invest more in domestic production, for example.
We have already got this one sorted after all.
The very point then is we should be getting our food from places where food can be grown at lower cost. And that’s import! – M LINEIL
