Release number IFAD/16/08

Food security bottom line says Indian scientist Swaminathan

Rome, February 14, 2008 – The International Fund for Agricultural Development (IFAD) ended its two-day Governing Council meeting today with wide agreement on the urgency of increased investment in agriculture in the face of rising food prices and climate change.

Delegates from IFAD’s 164 member nations unanimously agreed to accept the Republic of the Bahamas’ application for non-original membership.

IFAD is a specialized United Nations agency and an international financial institution.

The Council marked the start of IFAD’s 30th anniversary year and the beginning of the consultation process for the eighth replenishment of IFAD’s resources.

“We have entrusted part of the membership with reviewing the adequacy of our Fund’s resources with a view to strengthening its capacity to respond to the needs of the rural poor,” said Jörg Frieden, Vice-Chairperson of the Council in his concluding statement. “It is an onerous task and I wish the Consultation members every success.”

The eighth replenishment of IFAD’s resources comes at a time of rising food prices, triggering concern that many poor rural people in developing countries will not be able to afford to eat.

“We have seen price rises in the past, but we have rarely seen such an increase across so many commodities all at the same time,” said Suleiman Al-Herbish, Director General of the OPEC Fund for International Development at a roundtable on food prices held at the meeting.

“Historically, smallholder producers have shown resilience in commodity price increases and their potential to increase production is significant,” the roundtable members concluded.

The key is to ensure that smallholders reap the benefits of higher prices.

Reducing transportation costs, creating safety nets for those who buy more food than they produce and boosting productivity through public research and microcredit schemes are all measures that should be taken, the roundtable recommended.

According to the Food and Agriculture Organization, poor countries could see their cereal import bill rise by more than a third this year, with Africa faring worst of all. International wheat prices have risen 83 per cent in the past 12 months.

Increased global demand, low grain stocks, the rapid rise of biofuels and changing weather patterns were all factors contributing to the rise in prices.

Delegates to a round table on climate change called on IFAD to be a voice for poor farmers in international discussions on climate change and to increase the transfer of knowledge and know-how to poor farmers in the developing world.

In order to help poor rural farmers cope with climate change, Al-Herbish said the international research agenda had to be readjusted at the Consultative Group on International Agricultural Research, an alliance of 15 of the world’s top agricultural research centres.

The biofuel round table called on the international community to examine setting up a mechanism to regulate and monitor the impact of biofuel policy and usage, and its social and cross-border impacts.

There are concerns that forest clearance to make way for plantations and the switching of farmers to more lucrative biofuel crops could be detrimental to the climate, food security and land tenure of poor rural people. If well-managed, biofuels have potential to help rural development.

“Food security must always be the bottom line,” eminent Indian plant geneticist M.S. Swaminathan told the roundtable.

At a press conference earlier in the day, IFAD President Lennart Båge said that an increase in investment in agriculture would not only help improve global food security but was also a solution to other social ills.

“The major donor countries have not yet fully realized that the root causes of many social ills – youth unemployment, migration, urban slums and immigration, stem from the lack of investment in the rural space,” said Båge at a press conference.

“The problem is many people think agriculture is backwards and only the city is modern. Food is always key. It is something that is absolutely necessary and now with food prices going up it is something that produces large profits.”

“There is an economic reason, as well as a development reason to invest and that is not recognized enough.”

He said the key was for donor governments to urgently step up investments in agriculture to help the world’s poorest people, the vast majority of whom live in rural areas. Only around three per cent of international aid is currently directed at agriculture.

Båge said IFAD would step up efforts to help poor rural people organize collectively. He gave the example of a woman farmer he met on a trip to Viet Nam last month. “The prices of inputs, seeds and fertilizers had gone up, prices had risen in the market but the wholesale purchaser was still paying the woman the same price, so she was being doubly squeezed when she should have been benefiting.”

“If they are on their own and poor they have no influence, but if they come together then they can be strong.”

The IFAD Council also agreed to strengthen the UN agency’s consultation mechanisms and support smallholder farmers’ organizations. It was preceded by the biennial meeting of the Farmers’ Forum where delegates from more than 70 global, regional and multinational farmers’ organizations, representing millions of farmers, discussed policy with IFAD.

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IFAD was created 30 years ago to tackle rural poverty, a key consequence of the droughts and famines of the early 1970s. Since 1978, IFAD has invested more than US$10 billion in low-interest loans and grants that have helped more than 300 million very poor rural women and men increase their incomes and provide for their families.
IFAD is an international financial institution and a specialized United Nations agency. It is a global partnership of OECD, OPEC and other developing countries. Today, IFAD supports more than 200 programmes and projects in 84 developing countries.