CJC H1 Prelim 2024 QP

© Catholic Junior College 8843/01 JC2 PRELIMINARY EXAMINATION/2024 CATHOLIC JUNIOR COLLEGE JC2 Preliminary Examination Higher 1 ECONOMICS 8843/01 Paper 1 22 August 2024 No Additional Materials are required. 3 hours READ THESE INSTRUCTIONS FIRST An answer booklet will be provided with this question paper. You should follow the instructions on the front cover of the answer booklet. If you need an additional answer paper ask the invigilator for a continuation booklet. Answer all questions. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 10 printed pages. [Turn over

2 © Catholic Junior College 8843/01 JC2 PRELIMINARY EXAMINATION/2024 Question 1: Food Security and Sustainability Figure 1: Prices of selected primary products Source: Macrotrend and Statista, 2024 Figure 2: Fertiliser Price Index Source: The Financial Times, 2022 Extract 1: Sanctions on Russia and global food prices The war in Ukraine has had a major impact on the global supply of agricultural fertilisers, potentially undermining food security around the world. Russia, together with Belarus, is one of the world’s largest sources of mineral fertilisers such as nitrogen fertilisers. After the outbreak of war between Russia and Ukraine in 2022, many nations including the United States and the European Union (EU), have imposed sanctions on Russia’s key exports such as fertiliser and oil. Russia’s response to international sanctions has been to halt exports of more than 200 products. Crude oil is Russia’s largest export, follow ed by refined petroleum such as petrol and diesel.

3 © Catholic Junior College 8843/01 JC2 PRELIMINARY EXAMINATION/2024 Russia is also one of the world’s largest exporters of wheat. In terms of raw materials, Russia is the second largest exporter of cobalt, one of the key elements in making rechargeable batteries. As such, global food prices have been on the rise since 2022. The prices of many foods, ranging from wheat and other grains to meat and oils, have shot up. That’s been driven by a slew of factors, including the rising cost of fertiliser and energy in the past year as well as the Russia - Ukraine war. Around the globe, natural gas is used as a raw material as well as fuel for nitrogen fertiliser production. In response to rising costs of fertiliser, India plans to increase the fertiliser subsidies to a record of more than 1.55 trillion rupees ($20.64 billion) to avoid shortages amid a sharp increase in global prices of nitrogen fertiliser. The figure is almost double the amount budgeted for fertiliser subsidies relative to last year. To ensure food security, the government aimed to support farmers in maintaining high agricultural productivity. Fertilisers are crucial for achieving good crop yields. Furthermore, subsidizing fertilisers ensures farmers could afford the necessary nutrients for their crops without financial strain. Source: World Economic Forum, 2022 Extract 2: Environmental impact of fertiliser usage and water monitoring system Fertilisers have transformed the way the world produces food. Nitrogen and phosphorus are the two main types of fertilisers that farmers add to their fields. They have not only brought large benefits for food security, but they also bring environmental benefits through higher yields. But there can be a downside. When we overapply fertilisers – no matter whether they are natural ones like manure or synthetic fertilisers – excess nutrients are washed off and causes contamination of ground water, reducing longer -term soil health and productivity. Nutrient pollution in water bodies can affect habitats and food chains, leading to the decline in fish population. In response, governments have been actively monitoring water quality so that action can be taken quickly. Water monitoring systems and artificial intelligence (AI) cameras constantly monitor the water quality and report insights directly to the user, providing a real -time overview of the ecological health of waterways. These systems use a combination of sensors and AI cameras to monitor key water quality parameters such as temperature, dissolved oxygen, and the presence of contaminants like heavy metals or pathogens. The data collected is made available to the users and government agencies about the ecological health and safety of the water. Source: Our World In Data, 2021 and National Institutes of Health, 2023

4 © Catholic Junior College 8843/01 JC2 PRELIMINARY EXAMINATION/2024 Extract 3: Government responses 3.1 Germany – Restriction on the use of Nitrogen fertilisers Germany's Fertiliser Ordinance places a limit on the amount of nitrogen and phosphate that can be used by famers. The regulations are meant to prevent water pollution and promote sustainable farming practices. However, compliance costs vary widely among farms, with some facing high costs, especially those with intensive livestock farming to agricultural land. The 2017 revision of the Fertiliser Ordinance introduced stringent measures, including limited nutrient application and mandatory use of low-emission techniques for spreading manure. The measures have significant economic and ecological impacts, particularly on livestock and dairy farms, which have had to adapt to comply with the new rules. Farmers may need to select crops that require less nitrogen to stay within nutrient application limits, which affects overall productivity and profitability. 3.2 Singapore – Comcrop and Hydroponics To achieve food security, t he Singapore government supports urban farming initiatives . It has provided various incentives and subsidies such as the agriculture productivity fund to companies like ComCrop to promote local food production and innovation in agriculture. Hydroponics uses less fertiliser compared to traditional soil -based farming. The huge advantage of hydroponics used by Comcrop is that while soil-based farming loses about 90 per cent of its water and nutrient delivery, Comcrop recycles all of that and feeds the crops the exact amount of nutrients they need to grow. The combination of computer-controlled lighting and nutrients delivery can produce more consistent, higher-quality yields without harmful pesticides. Cutting-edge technologies like vertical farming, hydroponics, and aquaponics maximize yield per unit area and reduce resource inputs such as water and fertilizers. Source: Reuters, 2021 Extract 4: A sustainable food system for Singapore Singapore is vulnerable to supply shocks and disruptions as the small island-nation imports more than 90 per cent of their food. For greater food security and affordability, Singapore has set an ambitious “30 by 30” goal – to be able to produce 30 per cent of their nutritional needs by 2030. And the challenge is to achieve this with less than 1 per cent of land set aside for farming to ensure Singapore can have a reliable access to sufficient supply of affordable and nutritious food. This requires Singapore to grow more with less, in a highly productive, climate -resilient, and resource-efficient way with the use of technology . Long-term strategic planning is critical in achieving their goal in food security and this will be achieved from both production and consumption aspect. Singapore is re-developing the Lim Chu Kang area, where many o f their farms are currently located. The government’s vision is to transform it into a vibrant, high -tech agri-food cluster to boost domestic food production and achieve food security in the long run. Source: Singapore Food Authority, 2022

5 © Catholic Junior College 8843/01 JC2 PRELIMINARY EXAMINATION/2024 Questions (a) (i) Using Figure 1, compare the prices of the selected primary products from 2017 t