Mr. Chairperson,
Mr. President,
Fellow Governors,
Distinguished Delegates,
Ladies and Gentlemen,

It is my privileges and honour to attend the 33rd Session of the Governing Council of the International Fund for Agricultural Development. I would like to begin by expressing my sincere appreciation to the President of IFAD and his team for their excellent work in preparing this important event in this work-of-art building.

Distinguished Chairperson, Mr. President, Board of Governors,

Even though signs have been appearing on the horizon of an imminent recovery from the global economic crisis, there are nevertheless other issues, such as the increasing prices of oil fuels and the pending impacts of climate change that have delayed efforts by developing countries, such as Indonesia, to achieve the MDGs and eventually to reduce poverty.

As a country that has just gained the status as a middle-income country, Indonesia is nevertheless still facing classical problems such as unemployment, poverty, and significant gaps of economic growth among its regions. Therefore, IFAD loans which focus to the poorest population in food vulnerable regions, minority groups, poor farmers who cultivate rain-fed lands, high lands, coastal areas, and other marginalized areas is considered to be very important.

For that reason, my delegation supports the IFAD plan to revise its lending policy and criteria, specifically in the determination of lending interest rates. Yet, we are of the view that such revision should not only be based on the gross national income per capita and lending terms threshold, but also taking into account the poverty rate and geographical disparity of a country as it is in line with the mandate of IFAD to include agricultural and rural development through the empowerment of marginalized farmers. In addition, IFAD mostly obtained its funding sources from the contribution of member nations, not from the international money market.

Distinguished Colleagues and Governors,

For the last thirty years, IFAD had attained visible achievements in its efforts to assist the revitalization of agriculture and rural development in Indonesia, particularly in the Eastern part of Indonesia. Since 1980, IFAD has extended highly concessional loans to Indonesia covering 13 programs and projects, totalling USD 333.5 million. Ten of these programs and projects have been completed, and three are on-going. Two examples of IFAD funded projects that have been successfully implemented in Indonesia are the Income Generating Project for Marginal and Landless Farmers (P4K) and the Participatory Integrated Development in Rain-fed Areas (PIDRA). The development approach of these projects has been widely recognized and adopted as an excellent concept for community empowerment and agricultural development. At the national level, this concept has been adopted as a model for developing the National Program for Community Empowerment (PNPM), which is the umbrella for Indonesia’s National Poverty Reduction Program. In addition, IFAD has mobilized essential co-financing within the country of around USD 384.3 million. This makes the funding of the programs in Indonesia to total around USD 717.36 million.

In view of the increasing portfolio of IFAD and its increased allocation for the Eight Replenishment, our delegation would like to propose IFAD to establish its country presence in Indonesia so that it can monitor and supervise the implementation of its portfolio in an intensive and continual manner.

Distinguished Chairperson,
Mr. President,
Board of Governors,

In its alignment to the principles carried out within the Paris Declaration of Aid Effectiveness and the Accra Agenda for Action, the Government of Indonesia has recently reform its national procurement system so that it is in par with the international best practices which inter alia underline principles of competitiveness, fairness, transparency, and good governance. Within this context, we would strongly encourage IFAD to harmonize its IFAD assisted projects procurement policy in Indonesia with the current procurement system of the Government of Indonesia.

Mr. Chairperson,
Distinguished Board of Governors,
Ladies and Gentlemen

Finally, my delegation is of the view that human resources is one of a pertinent issue for the future of IFAD, particularly in improving the principle of ownership within IFAD development programs and strategies. Hence, we would like to express our hopes that under the leadership of the President of IFAD, there will be an increase in the proportion of employees from developing countries. Furthermore, we trust that IFAD will continue its commitment to the principles of geographical diversity and gender empowerment, which we believe still deserve a greater attention.

Thank you.

17 February 2010