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Press Dossier   News Category    Economy    Bolster supply chain management to ensure food security: Economist

Kuwait Times, Thursday, Mar 23, 2023 | Ramadan 1, 1444

Bolster supply chain management to ensure food security: Economist

Kuwait : Food security is in focus recently due to the political and economic situations around the world including the Russia-Ukraine war, financial crises and debates whether to raising the interest rate to control growing inflation. Meanwhile, food staples have been weaponized to pressure countries — for instance, the Russian invasion of Ukraine has forced the world to find alternative suppliers to secure sufficient supplies amid shortages of wheat and other raw materials.

The Kuwaiti government has announced food reserves in Kuwait are stable and can cover the country’s population for six months with all basic consumables. But will the global instability force the country to rethink options and needs to ensure its food security? And whether the presence of financial resources is enough to depend on during crises?

Economist Hajjaj Bou Khaddour stressed the importance of developing the country’s food security, saying the most realistic solutions are through three steps — working on a solid supply chain management, reforming local agricultural lands and investing in agricultural lands outside Kuwait.

Bou Khaddour said proposals have been presented to the government since the early nineties based on the situation the country went through during the Iraqi invasion of Kuwait. “After the liberation, I proposed we should adopt the concept of food security, and highlighted the country must invest in it,” he said. He added that as Kuwait is not an agricultural country, it has to invest in agricultural lands outside Kuwait and in the food industry as well. It is also important to work on creating a solid management of the country’s supply chain, staring from the procurement of raw materials to the delivery of the product to its final destination in stores.

“Land reform for agriculture must include lands reserved for oil production, especially since Kuwait’s exploitation of oil lands is only about 5 to 10 percent, while the rest of the land is also reserved for the ministry of oil,” Bou Khaddour said. He pointed out technology and techniques can make it is possible to develop investment methods in way that can be adopted in Kuwait, such as using vertical farming. “There are vertical farms in many countries such as Japan,” he said.

“This investment will achieve internal and external food security. Kuwait established distinguished projects during the sixties like the Food Catering Company, Flour Mills Company and the Livestock Company. The country was proactive in this field, then the wheel stopped in the seventies when food insurance came for certain items,” Bou Khaddour recalled.

Financial resources

Bou Khaddour said financial resources are not a rescue factor during times of need. “For some cases it could help, but when we think about it, we are talking about food security, not food imports. It is a matter of state security in terms of food. Therefore, it is required to secure food through a strong strategic dimension,” he said.

“Investing in the agricultural lands, whether outside or inside the country, will save plenty of money in the import budget, especially since consumer prices are constantly rising exponentially,” he highlighted, pointing out that despite the importance of a local role in cooperating to help in this issue, unfortunately there are no institutions equivalent to Kuwait Flour Mills to lend a hand as well.

Expected results

Regarding the expected results from creating a supply chain management (CSM), he said the rate of food savings will be much higher, as it will exceed the period of five years instead of only six months. “The benefits of supply chain management are that it is not limited by time; it is continuous and permanent. It will also achieve what is called sustainable development,” Bou Khaddour said. “As a quick solution, there are too many lands in the hands of the government, which must be invested in setting up warehouses, even with the BOT system, especially if the government decides one day to implement the SCM system, so it won’t be facing obstacles.”

UAE experience

In 2017, the Department of Agriculture and Livestock in Sharjah announced a local initiative titled “Emirates wheat”, to operate a wheat farm in Maliha area, representing national efforts in the field of enhancing food security, which extends over an area of 1,900 hectares, according to Emirates news agency WAM. The initiative today produces more than 80 tons of wheat at the state level during the harvest season, according to Emarat alyoum.

On Monday, Ruler of Sharjah and Member of the Supreme Council Sheikh Sultan bin Muhammad Al-Qasimi clarified that the wheat produced in Sharjah is considered one of the best in the world as it contains the highest percentage of protein and is free from chemicals, fertilizers and other substances harmful to human health.

Meanwhile, UAE benefited from its location as a geographic gateway between the East and West, and succeeded in developing a commercial system that made it a trade corridor and one of the most important transport corridors and re-exporter of many products, including wheat, while it exported about 100,000 tons of wheat in 2017/2018, according to Arabic RT.

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