Governors, Mr President, Ladies and Gentlemen,

It is a great pleasure and privilege for me to attend the 25th Session of the Governing Council of IFAD.

IFAD can already look back on a quarter century of very valuable work in the field of rural poverty alleviation, and of efforts to increase household food security. As we all know by now, poverty alleviation is the unanimously agreed upon overarching development goal and is part of the set of the Millennium Development Goals, where it is stated that the number of the world's poor should be halved by 2015.

Austria fully subscribes to this international development goal. Only if we manage to reduce poverty and to achieve a more equitable distribution of wealth, we will be able to reduce tensions and hopelessness which otherwise might constitute potent roots for unrest, conflicts and terrorist activities. In other words, if we want to eradicate terrorism sustainably, we must address also the severe social problems and fight poverty and hunger.

We believe that IFAD can make valuable contributions to achieve this goal by constantly fine-tuning and sharing the knowledge it has acquired over the years in rural poverty alleviation with other players in the development field. IFAD's grass roots approach is a good example of the Fund's expertise as it gives due regard to the needs of the aid addressees by integrating them in the design of projects and aid programs in order to secure efficiency and targeting of aid efforts. This approach is also reflected in the concept of country ownership of development activities which forms part of the Comprehensive Development Framework that was proposed already a couple of years ago by the World Bank.

I would like to turn now to IFAD's participation in the HIPC Debt Initiative. There is a general consensus that freeing very poor developing countries from the burden of unbearable debt is a prerequisite for sustainable economic and social development. IFAD's willingness to make an appropriate contribution to the HIPC debt initiative is therefore commendable. We have supported IFAD's intention to participate in this initiative at previous occasions but, at the same time, we have also underlined that this can only be done if the Fund has sufficient resources at hand. Participation in the HIPC Debt Initiative must not happen at the expense of IFAD's lending capacity. In this regard, our position has remained unchanged; therefore, we understand that the Fund is looking for additional resources to cover its cost incurred through debt relief. To the extent, that these cost cannot be covered by its own resources without jeopardising its lending capacity, we would support IFAD's intention to come to an agreement with the World Bank giving the Fund equitable access to untied HIPC-Trust Fund resources. Within the framework of such an agreement, we would not see a problem to using a portion of Austria's untied contribution to the HIPC core fund on a pro rata basis together with core fund contributions of other donors.

Some remarks on the next replenishment of the Fund. We understand that the Fund in order to be able to maintain a reasonable annual lending level of around USD 450 million needs fresh resources soon, although the last replenishment was only completed just over a year ago. In the context of the last replenishment negotiation Austria and many other donors stressed the need for the Fund to work constantly on its comparative advantage in the field of rural poverty alleviation and to prove that advantage through convincing results. This issue will be raised again in the upcoming negotiations, and in this context a positive external efficiency examination of IFAD projects could serve as a persuading argument for donors.

Some comments on the Programme of Work for 2002. As already indicated before, we support the volume of USD 450 million which we consider appropriate and necessary for the Fund's impact and role. When allocating Fund resources we expect IFAD to give due consideration to the performance of borrowers and to the policy environment prevailing in borrowing countries, reflecting inter alia the principles of good governance.

Regarding the Budget for 2002 presented for adoption we commend the Fund for its continuous efforts to contain administrative expenses within the limit of inflation rates.

At this Governing Council marks the first year of Mr Båge's presidency, I would like to take this opportunity to thank you, Mr President, for an excellent job done at the top of this institution and to wish you continued success in guiding the Fund on its difficult mission.

My thanks go also to the staff of the institution for their professional work.