Central America squeezes budgets in food crisis

Central American governments faced with rising global food prices are cutting import tariffs, freezing prices and subsidizing food to try to stave off a devastating hunger crisis.

Already struggling to keep fiscal accounts in check after a sharp economic downturn, the region's small countries risk higher budget deficits and distortions in local markets as they take measures to protect the poorest families.

World food prices hit a record in January, even higher than the levels seen in 2008, when a food crisis sparked violent protests in some countries around the world.

Original source: Reuters