Unpredictable markets, high food price volatility to feature at IFAD Governing Council
Press release No.: IFAD/05/09
164 Member States will meet in Rome on 18-19 February: election of a new President on agenda
Rome, 12 February 2009 - Against a backdrop of volatile food prices and deepening global recession, 164 Member States of International Fund for Agricultural Development (IFAD) will meet in Rome next week for the Governing Council (GC).
The annual meeting will feature keynote statements by the Italian Minister of Economy and Finance, Giulio Tremonti, and the Brazilian Minister of Planning, Budget and Management, Paulo Bernardo Silva. A highlight of the Governing Council will be Round Tables addressing issues of food price volatility, climate change, and access to land. The Governing Council will also elect a new IFAD President.
The Governing Council, IFAD's highest decision-making authority, will hear what Member States have done to tackle the triple scourge of food, fuel and financial crisis, and discuss how to ensure that the most vulnerable – rural poor people in developing countries – are not forced deeper into poverty.
Despite efforts to boost agricultural production in response to the commodity price rises of 2008, most of the increase in yields has been in developed countries. Agricultural production in developing nations has risen by less than one per cent overall.
The High-Level Meeting on Food Security for All, held in Madrid last month, addressed the effects of price fluctuations on vulnerable populations and reviewed progress made since the June 2008 global food summit in Rome. The UN Secretary-General Ban Ki-moon praised the response of the international community to the food price crisis but warned that more must be done to prevent the current financial crisis from pushing more people into hunger.
IFAD has long argued that investment in agriculture – which has been declining for decades – must be boosted to help secure global food security and to avert further food crises.
The Governing Council comes on the heels of the strong endorsement that Member States gave IFAD in December 2008, with the largest ever replenishment of the Fund's resources, a 67 per cent increase over the previous replenishment. As a result, over the next four years IFAD will provide financing of around US$3.7 billion for agricultural programmes and projects in developing countries, with a total cost, including co-financing with other partners, of about US$8.5 billion.
During the three Round Tables slated for the first afternoon of the Governing Council, international experts will share their knowledge and analyse the challenges facing smallholder farmers:
- unpredictable markets and high price volatility
- the growing demand for land and the risks and opportunities for smallholder farmers
- the need for research and innovation in the context of a rapidly changing climate.
Delegates to the 32nd session of the Governing Council will elect a successor to Lennart Båge, who is concluding his second and final four-year term as IFAD's President.
The new President will be appointed after election by the Governing Council for a term of four years, renewable once.
The President of IFAD has the same rank as the elected heads of other major United Nations specialized agencies, is a Member of the United Nations Chief Executives Board for Coordination, which is chaired by the UN Secretary-General and provides guidance for the coordinated work of the UN System as a whole.
Note for editors
Theme: "Smallholder agriculture and food security in the twenty-first century"
Time: 3.30 to 5.30 pm on 18 February
Venue: Palazzo dei Congressi, Piazzale Kennedy, EUR, Rome
Roundtable 3: Research and innovation for smallholder farmers in the context of climate change
Information on IFAD in 2008
During 2008, new IFAD loans and grants were made to 32 developing countries for agriculture and rural development amounting to $602.2 million.
Throughout 2008, IFAD continued to seek innovative solutions to rural poverty, promoting public-private partnerships, boosting farmers' organisations, helping create off-farm enterprises, ensuring technology and knowledge are shared and increasing access of poor farmers to financial services.
At the end of 2008, IFAD was financing 202 effective programmes and projects in 81 countries and one territory, for a total investment of US$3.4 billion.
Western and Central Africa
In the context of fluctuating food prices in 2008, IFAD worked in countries such as Benin, Cote d'Ívoire, Ghana and Niger to improve food security by redirecting unspent funds for country interventions to support national programmes facilitating access to inputs for the current and next cropping seasons. And the organisation continued its longer-term programmes to increase smallholders' productivity.
At year's end, IFAD's regional portfolio consisted of 46 programmes and projects in 20 countries, for a total of US$587.4 million investment.
During 2008, IFAD continued to re-orient its country programmes and the new projects it supports in the region to focus increasingly on agriculture and on improving agricultural productivity. This includes the development and dissemination of agricultural technologies. Improved soil fertility and better water management are also key elements in programmes that support governments' efforts to boost agricultural productivity. Value chain development is another increasingly important part of IFAD's investment portfolio in the region.
At year's end IFAD was funding 43 operations in 15 countries, for a total of US$719.4 million.
IFAD designed various projects to support microfinance and access to financial services for poor rural people through funding training and technical support and developing innovative credit projects. IFAD also worked closely with some 1,400 natural resource management groups and with key agricultural research institutions. Examples of its work include programmes to rehabilitate weed-infested fields in Laos, for intercropping rice and legumes in Nepal and to encourage private seed companies to make improved seed available to small farmers in the Indian states of Gujarat and Maharashtra.
Nine new programmes and projects were started in 2008 taking the ongoing total to 48, spread across 14 countries. The value of IFAD's investment in the region is US$1,036.5 million
Food price rises impacted the entire region and seven countries in Latin America and the Caribbean experienced double digit inflation in food prices. IFAD sought to limit the impact on rural poor people by adapting ongoing initiatives and emphasising innovation, knowledge management and the scaling up of successful projects. IFAD financed remittances-related projects in eight Latin American countries.
In Haiti, where food price rises led to hunger and riots, IFAD provided US$ 10 million to help kick-start agricultural production with inputs for the new growing season, after devastation by tropical storms.
At the end of 2008, IFAD's ongoing portfolio totalled US$519.2 million, supporting 30 initiatives in 17 countries.
Economic growth remained strong in the Near East and North Africa region, despite the financial crisis, but the rising food prices in the first half of 2008 struck particularly hard, with many Arab economies heavily dependent on food imports. The problem of youth unemployment in rural areas was addressed through the establishment of rural business development centres in Egypt and Syria.
Supporting financially sustainable supply chains continued to be IFAD's focus in most Central and Eastern Europe and the Newly Independent States.
IFAD's ongoing portfolio in these two regions totalled US$522.5 million for 35 projects and programmes in 16 countries and territories.
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 .6 billion in low-interest loans and grants that have helped over approximately 350 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 close to 250 programmes and projects in 87 developing countries and one territory.