IFAD Asset Request Portlet

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Address by H.E. Raymond Barre, Former Prime Minister of the French Republic

It is an honour for me to speak to you on the occasion of the twentieth anniversary of the International Fund for Agricultural Development and to pay tribute to the acheivements of this United Nations specialized institution.

As an economist, I am aware that agriculture plays a major role in a country’s economic development. The economic history of industrialization shows that an agricultural revolution preceded, promoted and sustained the industrial revolution of the late 18th century in Great Britain. More recent history clearly suggests that poor agricultural management or the abandonment of agriculture in favour of forced industrialization seriously affects a country’s economic development and its people’s living standards. Do I need to remind you of the harmful effects of collectivization and agricultural planning in the Soviet Union?

Algeria, once a country with a thriving agricultural sector, was obliged to use most of the resources from its petroleum and gas activities to pay for food imports.

Agricultural development is a major factor in any economic development policy; it provides the means to feed the population - which is the primary aim of economic activity - to raise the incomes of those employed in agriculture and, thus, to increase demand overall, boost agricultural exports and cut imports, thereby helping to maintain the balance of both trade and payments.

For the past twenty years, a number of countries, of which I shall mention only two, have provided excellent examples of agriculture’s role in development.

China has always accorded top priority to agriculture and refused to extol the virtues of forced industrialization, with its leaders ensuring that agriculture has a central role in each of its successive development plans. India has obtained very positive results through agricultural expansion, particularly its “Green Revolution”, which is an outstanding example of how technology can be used to modernize agriculture.

I would also add that agricultural development is an essential component of sustainable development which requires the integration of the economic and environmental aspects of development. The Rio de Janeiro conference placed particular emphasis on the relationship between poverty and environmental degradation. Deprivation often compels rural people to use their natural resources until they have exhausted them, thereby further aggravating their situation.

This is why IFAD takes into account the ecological implications of rural poverty and its eradication. Some 70% of IFAD projects clearly spell out the environmental objective and include creative remedies based on the capabilities and outstanding ingenuity of the local people.

The past three centuries of economic history have taught us that any steps taken to promote agriculture have also promoted economic development.

In this connection, IFAD’s establishment, in the wake of the World Food Conference in Rome in 1974, was an excellent initiative. There were two reasons for establishing the institution:

  • the wish to recycle a portion of the petroleum exporting countries’ increased income following the oil price rise in 1974;

  • the developing countries’ determination to compensate for FAO’s powerlessness during the serious food crises of the seventies.

However, what makes IFAD an original institution at the service of agricultural development, and not just another international body, are its simple yet precise terms of reference:

“TO COMBAT HUNGER AND RURAL POVERTY IN LOW INCOME, FOOD DEFICIT REGIONS THROUGHOUT THE WORLD”

IFAD’s objective is to combat the chronic, persistent hunger which weakens and kills 40,000 people every day, week after week and month after month.

The Fund’s operations involve combating poverty - a step which economic globalization has made necessary and urgent. Thus, the overriding objective in agriculture in every country today is to combat exclusion which, in an increasingly interdependent world, affects a large part of its population.

Another original feature of IFAD’s operations is the methods used - methods which illustrate what I shall call the micro-economic aspects of agricultural development. The institution’s main concern is to ensure that the rural poor participate actively in their development. The Fund is not greatly interested in overall quantities - output, exports and total income. It is interested in the men and women who are battling against poverty. The philosophy is one of self-help and the approach is from the bottom up.

IFAD assists projects developed at village level by groups of farmers, craftsmen or fishermen and encourages small farming operations.

It favours the use of simple technologies, requiring small investments, likely to improve productivity, thereby increasing the incomes of those involved.

IFAD’s method tends to promote continuous, sustainable development, based on a definition of the requirements of individuals or small groups, on the use of their know-how and aptitudes, and on the promotion of traditional means of existence and effective resource management practices. The aim is to achieve rapid agricultural development by turning to the farmers, the men and women engaged in agriculture.

An interesting aspect of IFAD’s operations is the important role accorded to women in rural community development. Women are the home makers. It is they who are responsible for the households’food security and who are a dynamic productive force. They have therefore been fully integrated into project preparation and implementation. They have greater access to social services, as a result of which their daily domestic chores and other responsibilities are alleviated. Thus, they are able to improve their social status within their communities and are encouraged to assume key roles. Good examples of efforts to promote women can be seen in the IFAD-funded project in Tamil Nadu, India, and in the integrated agricultural development project in the south-western part of Anhui Province in China.

I would also like to mention the attention IFAD has paid to developing capital structures suitable for funding the activities of the rural poor. Historically, the savings which funded the expansion of crafts and industries in what are now the developed countries derived from agriculture. IFAD is, therefore, anxious to establish appropriate savings and funding mechanisms for poor rural beneficiaries in order to increase their level of responsibility and encourage them to find profitable activities.

IFAD has put in place a lending system offering 50 and 20-year loans on highly concessional terms, in addition to loans on ordinary terms. The institution’s experience has shown that the crop and livestock farmers’ and fishermen’s associations which benefit from these loans are creditworthy and can be relied upon to repay their loans.

Indeed, repayment rates are outstanding, surpassing by far those for agricultural credit in many industrialized countries. Thanks to such loans, the associations are able to purchase basic requirements such as seed, fertilizer, tools and nets, and food processing equipment, and to start up micro-enterprises, thereby increasing productivity and improving the people’s living standards.

Although international institutions are often criticized, IFAD enjoys a well-deserved reputation for effectiveness. Between 1978 and 1995, it funded 429 projects in 106 countries on all the continents. It has established an effective partnership with 160 Member States. Management of its affairs is based on close cooperation between industrialized and developing countries, which share in the definition of policies and priorities and in the mobilization of resources for project funding.

Working methods have constantly been improved and reorganized. Between 1993 and 1996, administrative expenditure was cut by more than 20%, whilst provision of services increased by the same proportion.

It is not surprising that in 1997, IFAD was chosen to host the Global Mechanism of the United Nations Convention to combat desertification and mitigate the effects of drought in particularly affected countries, especially in Africa.

IFAD also participated in the IMF and World Bank initiative designed to roll back the debt of the very heavily indebted poor countries. The institution is expected to mobilize about 60 million dollars through the establishment of a trust fund set aside for this initiative.

Twenty years after its establishment, IFAD can be satisfied with its results. Here, I shall mention only two:

  • the creation of 3.6 million jobs through 429 projects in 106 countries. These jobs are mainly in food processing, weaving and service micro-enterprises, which help diversify economic activity in very poor regions;

  • increased food production by some 40 million tonnes of wheat equivalent annually, i.e. the amount needed to feed 200 million people.

The Fund has established a successful system of cooperation between industrialized countries, developing countries and non-governmental organizations.

IFAD’s Assessment Commission, which visited all the Fund’s beneficiary countries, noted beneficiaries’ enthusiasm and hoped that the institution would have sufficient funds in order to pursue its efforts. It also recommended that the Fund should remain a knowledge institution on rural poverty. At a time when economies are characterized by the predominance and the transmission of knowledge, IFAD must not only build up a bank of knowledge on rural poverty, but manage that knowledge and assist in its dissemination.

In the pursuit of its aims, IFAD must take into account present-day world trends, rural poverty issues and food insecurity.

Geographically speaking, a new “hunger map” has had to be drawn to take account of rising poverty in Eastern Europe, the situation of the people of the Great Lakes Region of Africa, and the persistence of numerous pockets of extreme poverty in Asia and Latin America.

At the same time, the cutbacks in official assistance in favour of much more selective private sector investments have made the fight against hunger and poverty a much more difficult task.

IFAD must, therefore, be much more selective in its efforts, must step up its cooperation with other international organizations in order to eliminate duplication of effort and seek new partners in the private sector.

The fact remains that whatever the effectiveness of the liberal ideas that lie behind international economic activity, the need for specific measures to bring the poor into the market economy cannot be ignored. Such measures are necessary at international and national level, as market mechanisms alone are either ineffective or inapt.

The generosity of private organizations cannot compensate for the relative decline in government contributions.

My wish on this the twentieth anniversary of IFAD’s establishment is for a significant public financial effort to be maintained when IFAD’s periodic replenishment consultations take place.

This is all the more necessary to ensure that the fully justified expansion of the Fund’s geographical area of involvement does not prevent IFAD from according some measure of priority to the African continent. Despite some encouraging progress, prospects for development in Africa are not as good as they are on other continents. The global economy cannot tolerate unacceptable disparities between the various parties.

My wish is that IFAD’s operations will continue, in the coming years, to help diminish world poverty and, by the same token, promote progress and peace.

Original Version (French)