Christine Burggraf, IAMO Expert consultation on trade and nutrition 15-16 November 2016, FAO Headquarters, Rome http://www.fao.org/economic/est/est-events-new/tradenutrition/en/

1. Economic transformation, agricultural
policies and nutritional habits in Russia
FAO Expert consultation on trade and
nutrition | 15-16 November 2016
Christine Burggraf, Thomas Glauben, Ramona Teuber

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Motivation
• Overweight and obesity not only in high-income countries
but also in low- and middle-income countries
• Common health consequences: non-communicable diseases
such as cardiovascular diseases, diabetes mellitus type II and
some cancers
• In emerging and transition economies the triple burden of
nutrition transition: undernourishment, micronutrient
deficiencies and obesity
• The prevention of diet-related chronic diseases is one of the
key global challenges of the 21st century!

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• “Russian people […] like to eat bread, sugar and animal fat -
quite “harmful” high-calorific foods. A lot of people use lard
instead oil for frying. Needless to say that the traditional
Russian food does not differ much from American burgers.”
(www.pravdareport.com)
Motivation

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In Russia:
• Prevalence of overweight and obesity increased from 52% in
1996 to 60 % in 2015
• Prevalence of diabetes increased from 3.4 % in 1996 to 9.2 %
in 2015
• Share of deaths from non-communicable diseases increased
from 81% in 2000 to 86 % in 2015
 Nutrition transition in Russia!
Motivation

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Motivation
Nutrition transition:
• Shift of dietary patterns with increasing household incomes
 away from a relatively monotonous and starchy diet with
high amounts of fiber
 towards a more varied diet of fruits and vegetables
 towards higher contents of fat, sugar and animal proteins
Positive link between nutrition transition and a growing
incidence of overweight, obesity and various chronic diseases,
including diabetes.

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Objectives
• Description of the development of Russian dietary patterns
during the post-Socialist transition
• Presentation of reasons why Russians – or different segments
of the Russian population – choose an unhealthy diet
• Recommendations for measures to improve the quality of
nutrition

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Russian nutrition transition
0
20
40
60
80
100
120
140
160
180
200
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Amountpercapitainkg/year
Years
Fruits and Vegetables Meat Products Dairy products
Figure 1: Quantities per food group available per person in kg/year
Source: FAOSTAT Food Balance Sheets (Per caput supply)

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Russian nutrition transition
0
500
1000
1500
2000
2500
3000
3500
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
kcalperdayperperson
Year
Fat Protein Carbohydrate Total
Figure 2: Energy percent per macronutrients available per person per day
Source: FAOSTAT Food Balance Sheets (Per caput supply)

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Macroeconomic development
Figure 3: Russian GNI per capita based on purchasing power parity (PPP)
Source: Worlbank Databank
0
5,000
10,000
15,000
20,000
25,000
30,000
GNIpercapita,PPP
Years

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Role of trade policy
Policies of trade liberalization:
• address physical trade and financial flows
• liberalization to improve economic growth with increasing
household incomes
• for example by:
reductions of import barriers
export promotion and
reduced restrictions on company ownership, financial flows
and trade in services

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Role of trade policy
Trade liberalization
policy Food system effects
Associated nutrition
effects
• Import facilitation
(e.g. reduce tariff
and non-tariff
barriers of trade)
• Export promotion
(currency
devaluation)
• Encourage foreign
direct investment
(FDI)
• Decreasing
support/protection
of local food
producers
• Increased availability and
decreased prices of foods,
especially of processed,
convenience and fast foods
• Decreased seasonal
fluctuations in food supply
• Increased animal production
by increased feed imports
• Stimulation of local food
industry by FDI, more
competition and food
technology transfers
• Specialization of local food
production with higher
profit margins
• Increased variety and
amounts of foods
consumed, especially
of fruits, vegetables,
meat and dairy
products
• Decreased seasonal
fluctuations
• Decreased
consumption of
carbohydrate foods
• Increased consumption
of processed, refined,
and pre-prepared foods
• Increased daily energy
intakes

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• Liberalization of international trade and foreign direct
investment has profound implications for food systems by:
 Food availability,
 Food accessibility,
 Nutritional quality,
 Prices; and
 Promotion of foods.
• Public health attention has only recently turned to the links
between trade and investment agreements, diets and health
Role of trade policy

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Role of trade policy
• Both negative and positive outcomes arise from different
aspects of trade liberalization
• Especially increasing availability and affordability of processed
foods and animal products with large portion sizes and a high
energy density
• Often uneven dietary development: high-income groups
accrue the benefits of a more dynamic marketplace, while
lower-income groups often experience convergence towards
poor quality diets

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2008 2009 2010 2011 2012 2013 2014 2015 2016
State Program for Development of Agriculture
for 2013-2020
State monopolized United Grain Company to maintain grain market stability
Eurasian Customs Union (EACU) for
economic integration and removal of all
customs borders
Eurasian Economic Union (EAEU)
harmonizing sanitary and food
safety regulation
Grain
export ban
WTO member (e.g., agreement for tariff
reduction of agricultural products)
WTO
ruled
policies
State Program for Development of Agriculture for 2008-
2012
Global financial crisis Severe
drought
Severe
drought
Western econ. sanctions and
Russian import ban on Western
food products
Trade policies in Russia

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Individual food demand
In addition to these macroeconomic influences, the decisive
factor will be if and to what extent the Russian population is
willing and capable of making its own contribution to healthcare
through balanced nutrition!

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𝑚𝑎𝑥
𝐼,𝐛,𝑇
𝐽 = 0
𝑇
𝑈 𝐛(𝑡), ℎ(𝑡) 𝑒−𝜌𝑡 𝑑𝑡
s.t.
𝐻 𝑡 = 𝐼 𝑡 − 𝛄′ 𝐛 𝑡 − 𝐜 − 𝛿(𝑡)𝐻(𝑡)
𝐴 𝑡 = 𝑟 𝑡 𝐴 𝑡 + 𝑤 𝑡 ℎ 𝑡 + 𝑦 𝑡
−𝜋 𝐻(𝑡)𝐼 𝑡 𝛼
− 𝐩 𝐛(𝑡)′𝐛 𝑡 − 𝑞(𝑡)𝑝 𝑞(𝑡)
𝐼(𝑡) = 𝐼(𝐠 𝑡 , 𝑚(𝑡); 𝐸(𝑡))
with
𝐻 0 = 𝐻0, 𝐻 0 > 𝐻 𝑚𝑖𝑛 > 0, 𝐻 𝑇 ≤ 𝐻 𝑚𝑖𝑛, 𝐻 𝑡 > 𝐻 𝑚𝑖𝑛 ∀ 𝑡 ≠ 𝑇,
𝐴 0 = 𝐴0, 𝐴 0 > 0, 𝐴 𝑇 ≥ 0, 𝛼 > 1,
𝐼 ∈ 0, ∞ .
𝑈: Utility
𝐛: relative intake of risky nutrients
𝐠: relative intake of healthy nutrients
𝐻: health capital with ℎ(𝑡) = 𝜙 𝐻(𝑡)
𝐼: health investments
γ: vector of health impact rates
𝛿: depreciation rate
𝑤: wage rate
𝑦: other income
𝐩 𝐛: price vector of risky nutrients
𝐩 𝐠: price vector of healthy nutrients
𝑞: representative outside good
𝑚: time invested in health
𝐸: nutritional knowledge
Dynamic Maximization Problem
Dietary health investment model

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Nutrient demand analysis
• Better-off citizens with higher educational qualifications tend to
consume more healthy foods that are rich in vitamins and minerals, but
they are also inclined to consume too many (saturated) fats.
• Poorer population strata are still struggling against considerable
vitamin and mineral deficiencies.
• Increasing prices for higher-fat foods reduce the consumption of these
products and at the same time benefit the consumption of foods rather
rich in vitamins and minerals through substitution effects.
• Nutritional knowledge is a key determinant of dietary quality.
17

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Policy implications
• To improve macroeconomic and agrarian development as well as a
better integration into international agricultural markets
• As long as import ban exists, to set more priority for import substitution
of greenhouse and early vegetables, fruits and berries
• To further develop small farming, rural areas and land improvements
• More effective measures to promote healthier diets, e.g. improving
communal-feeding menu offers, more nutritional knowledge and
product labelling such as traffic lights
• Tax on unhealthy foods often rather inadequate

19. Thank you for your attention!