High Level Meeting of the Heads of the Coordination Group Institutions and the International Donors and Development Institutions 

Mr Director General/Chairman
Colleagues, ladies and gentlemen,

It is an honour to participate in this High Level Meeting of the Coordination Group of the Heads of the Coordination Group Institutions and the International Donors and Development Institutions. I would like to express my thanks and appreciation to our esteemed host, Dr Abdulatif Al-Hamad, for his kind invitation.

I am also delighted to have this opportunity to return to Kuwait and would like to extend my thanks and deep appreciation for the warm hospitality extended to me by the Government of Kuwait.

I recall with great appreciation our excellent discussion on key development issues facing the Arab region in the High Level Meeting which our colleague, Dr Suleiman El-Hersbish, so graciously hosted at the OFID headquarters in Vienna in May of last year.  At that meeting I had the honour of co-chairing, with Dr Al-Hamad, the final plenary session where all institutions represented testified to the value of the discussion and reaffirmed their commitment to further strengthen and deepen our cooperation to promote a more coordinated and effective aid delivery system.

Today’s Meeting offers yet another important opportunity for continuing our dialogue on development issues and opportunities for increased collaboration. 

The Millennium Development Goals adopted by the Millennium Summit in September 2000 and endorsed later that month by leaders of OPEC at the Caracas Summit, gave the world unprecedented direction in its development efforts. With the goals agreed, the challenge was to mobilize the needed resources. The Financing for Development Conference in Monterrey in 2002 gave a new impetus to delivering on the 0.7% aid target and a new commitment to deeper debt relief. Of course, the countries of this region are already more than meeting the 0.7% target. Delivering on the commitments made at Monterrey will mean more countries following the generous example of the countries of the Gulf Cooperation Council.

With the development goals and the funding goals established, the international community has turned to the delivery system for aid. How to make it more efficient, effective and coherent.              

More than ever, we are all recognizing that global efforts to eradicate poverty and hunger require coordination and alignment of our activities.  The recent report of the High Level Panel on UN reform affirms the need to “deliver as one, in true partnership and serving the needs of all countries”.  The Paris Declaration on Aid Effectiveness calls on us to commit to the delivery of more effective aid based on the principles of country ownership, alignment, harmonisation, managing for results, and mutual accountability. 

Today’s Meeting recognizes the importance of combining our strengths and expertise. I am indeed encouraged by the degree of common purpose and understanding that has developed over the years among our partner institutions.  There is a very high degree of complementarity between IFAD and financial institutions represented here. This provides us with a sound basis for expanding our cooperation.  Nevertheless, the challenges involved in meeting the Millennium Development Goals by 2015 remain high.  With over a billion people in extreme poverty today, clearly we need to do more. 

Poverty is still largely a rural phenomenon.  The poorest countries are those with predominantly agricultural economies and societies, and the poorest people live mainly in rural areas.  Of the 1.1 billion people living on less than US$1 per day, 800 million, or three-fourths live in rural areas and depend on agriculture and related activities for their livelihoods.  Rural poverty must be addressed if the world is to meet the Millennium Development Goals by 2015.

The rural poor face a large number of socio economic constraints including lack of assets such as land and water, lack of access to services, technologies, and markets and lack of skills and organisation. They also face conflicts, crisis and climate change. No project today should be designed without a vulnerability analysis factoring in the effects of global warming.

There is a growing consensus that resources aimed at poverty reduction must focus more on agricultural and rural development.  The 2005 World Summit Outcome report reaffirmed the importance of adequately and urgently addressing food security and rural and agricultural development in the context of national development strategies. This year the World Development Report will for the first time in 25 years have the theme of agriculture.   

Agricultural development makes a critical contribution to overall economic growth in many developing countries. Studies show that for every dollar invested in agriculture, another two dollars can be generated for a developing country’s national economy.  In most poor countries, agriculture is the largest employer, job creator and export earner.  In most successful countries, progress in this critical sector has been the foundation for overall economic development and poverty reduction.  Put simply, progress in agricultural development generates increased income, which leads to savings and investments, and finally to greater demand for goods and services and a virtuous circle of growth and rising incomes for poor people.  

Established thirty years ago as a unique partnership between OECD, OPEC, and other developing countries, IFAD remains the only international financial institution dedicated exclusively to reducing rural poverty in developing countries.  We do not have all the answers. But we do have a dedicated and committed international staff, with an extensive experience working with many of the poorest and most marginalized communities across the globe. We have had successes and we have learned from our failures. What we have to offer is at your disposal and we want to learn from you too. 

IFAD has developed expertise in working with small farmers and poor rural people at the local level, providing knowledge, finance and services, and building the capacities of rural institutions. IFAD has invested some US$9 billion in over 700 projects and programmes that we estimate have reached 300 million poor rural people.  About 43 percent of the total has gone to supporting projects in Member States of the Organization of the Islamic Conference.

Mr Director General/Chairman,

IFAD recognises the importance of working with other institutions.  Our partnerships with members of the Coordination Group and the countries of the region have been particularly long and fruitful.  Stretching back to the inception of the Fund, these partnerships reflect the crucial role played by the Gulf countries in the Fund’s establishment and the shaping of its early mission and policies.  They have been further strengthened by the generous contributions that countries in the region have made to IFAD’s regular resources. 

I am very pleased to share with you today a brochure entitled:  ‘IFAD and the Gulf Cooperation Council: Working together to fight rural poverty’.  It provides more details on how IFAD works with institutions in this region and I hope you will find time to read it.

I am also pleased to share with you ‘Rural Echoes in the Near East and North Africa’, a quarterly newsletter just launched by IFAD and available on our website. It highlights some of the work that IFAD is doing in support of rural poverty reduction in the region.

IFAD has operational partnerships both with the bilateral financial institutions of GCC Member States, and the multilateral financial institutions of the Coordination Group.  Together, these partners have provided nearly US$900 million in co-financing for over 100 IFAD-supported projects, worth a total of about US$5 billion in 56 developing countries.  We have collaborated on numerous activities that include the cofinancing of projects, joint programme development, the supervision of IFAD-supported projects and policy dialogue.  IFAD’s partnerships with the Arab financial institutions collectively represent 12 per cent of the total cofinancing of IFAD projects and are the Fund’s second largest source of cofinancing after the World Bank. I am keen for us to do even more together.

In addition to project loans and country grants, IFAD has supported research benefiting the Near East and North Africa region.  Investments of more than US$110 million have focussed on agricultural research and technology transfer, contributing to significant achievements in agricultural productivity, land and water management, environmental stability, pest management, and food security.  These investments are of course based on close partnerships with research institutions and development organizations in the region.  

In the communiqué that was issued at the Vienna meeting last May, the Coordination Group identified some key factors as being critical for the alleviation of poverty. These include ownership, capacity building, micro-credit, and the need for new employment opportunities. These are indeed very much in line with IFAD’s own revised Strategic Framework 2007-2010 and our thematic priorities in the Region.  These priorities include: improved management of land and water resources, addressing youth employment as an integral part of poverty reduction programmes, increased use of rural microfinance, and linking smallholder farmers and the rural poor with international markets. 

I am pleased to note the increased interest by members of the Coordination Group to address the issue of extreme poverty, particularly in the least developed countries.  In this regard, I would like to congratulate Dr Mohamed Ahmed Ali and the Islamic Development Bank for recognizing that we simply have to make faster progress to eradicate poverty and to establishing the Poverty Alleviation Fund to help do that.  I salute this initiative and would once again underline the role that agriculture must play if we are to accelerate progress.

I am fully committed to further deepening IFAD’s partnership with the Gulf region and the financial institutions represented here.     

With our combined experience and resources, I am confident our joint efforts will make a difference in ensuring that we achieve our common goal to reduce the proportion of poverty and hunger by half by the year 2015. 

Thank you.

Kuwait, 4 February 2007