IFAD’s response to rising food and energy prices

SenegalIFAD recognizes the need for a concerted, comprehensive and coordinated effort by the international community. It played an active role in the High Level Task Force on the Global Food Security Crisis, established by the United Nations Secretary-General in April 2008. The task force produced a Comprehensive Framework for Action, which aims to ensure that the international effort is well planned and coordinated. IFAD now hosts the Rome hub of the Secretariat of the task force.

Partnerships are essential in overcoming hunger and addressing food security. IFAD's key partners are poor rural people and their organizations. IFAD also works with the Food and Agriculture Organization of the United Nations (FAO), the World Food Programme (WFP), the World Bank and other partners. In this broad partnership, governments play a key role in guiding international efforts to ensure an effective, efficient and coherent response to the challenge of global food security.

IFAD was set up to help combat rural hunger and poverty. It focuses on strengthening the capacity of poor rural people to respond to and shape the challenges and opportunities they face. Farmers' organizations play a key role in defending the interests of poor rural people in an increasingly competitive and global market. Strengthening these organizations is fundamental to the way IFAD works.

During the Eighth Replenishment of IFAD's resources in 2008, IFAD's Member States agreed to contribute US$1.2 billion to the Fund. This means that IFAD will be able to considerably expand its programme of work up to US$3 billion during the period from 2010 to 2012. It will continue to strengthen its development effectiveness and expand its investments in sustainable agricultural production in order to guarantee food security, nutrition and rural development, and to eliminate the root causes of hunger.

On 25 April 2008 IFAD announced that it would make available up to US$200 million from existing loans and grants to provide an immediate boost to agricultural production in the developing world, in the face of high food prices and low food stocks. 

IFAD's initiative was reflected in the conclusions of the Berne meeting of the Executive Heads of the UN's specialised agencies, Funds and Programmes, and Bretton Woods institutions, on 28-29 April.  That meeting agreed that there was a need for action to provide developing country farmers with the support required to ensure the next harvest.  IFAD's initiative provides part of the answer to that need. 

The purpose of the US$200 million is to enable poor farmers to access essential inputs such as seeds and fertiliser, to allow them to prepare for the forthcoming cropping season as well as to establish a basis for sustained increases in production in subsequent seasons.  The US$200 million is distinct from emergency relief, food aid or social safety nets, but could accompany such aid measures provided by other partners. 

The US$200 million is not additional funding.  The figure has been estimated from the un-disbursed balance from existing loans and grants which could be allocated to meet immediate needs for food production.  In cases where a country has a loan or grant that already includes a component for farm input and materials, the prompt  disbursement of those funds might be the most useful response.  In other cases, some reallocation may be necessary. 

Allocation of funds from the US$200 million balance needs to be at the request of governments in member countries, in line with standard IFAD procedures. IFAD has the capacity to respond quickly to such requests.    Through its Country Programme Managers (CPMs) among others, IFAD is already communicating to governments IFAD's willingness to provide assistance to deal with the farmer response to food prices, through existing IFAD projects and, where appropriate, as part of a consortium response involving others, such as the World Bank, the regional development banks, FAO and WFP. 

The FAO list of food crisis countries currently contains 37 countries.  IFAD has operations in 26 of these but is also responding to requests from other countries who are seeking to develop both short and medium term responses.