FAO CALLS FOR MAJOR CHANGES TO FOOD AID SYSTEM

Major changes in the way international food aid is managed and delivered are necessary, said the UN Food and Agriculture Organisation (FAO) in its latest annual report. "The State of Food and Agriculture 2006," released on 24 January 2007, focused on food aid effectiveness because 39 countries currently require emergency food assistance, twice as many as two decades ago, said FAO Director-General Jacques Diouf at the launch of the report.

Currently, the bulk of food aid is provided on the condition that it be purchased and processed in the donor country. This is often expensive and slow: the FAO estimates that in 2006, one-third of the world's total food aid budget went to developed nations. Not only does such food aid often take 6 months or longer to reach the needy population, it can also distort local markets and undermine the stability of local food systems by arriving at the wrong time or displacing commercial exports. Food aid has been a controversial issue in the Doha Round WTO negotiations.

The FAO urges donors to provide food aid in the form of cash or vouchers, and to source food locally. The report also criticised tying food aid to political or social goals, and neglecting longer term strategies to address the root of food shortages.

The US accounts for more than 50 percent of the global budget for food aid. In its proposals for future farm spending, the Bush administration has called for allowing up to 25 percent of food aid to be provided in cash to the recipient country, to buy food locally and from certain other developing countries.

The EU welcomed the US administration's step towards cash aid, in spite of dissatisfaction with other parts of the farm bill proposal.

Luther Tweeten, a professor at Ohio State University, argues that that cash aid facilitates corruption. He told South African daily Business Day that the real barriers to boosting agricultural production and feeding the hungry in needy nations are trade barriers and the absence of economic freedoms. The Alliance for Food Aid, responsible for delivering US food aid, is calling for a pilot programme to test the proposed changes.

ICTSD reporting; "South Africa: Food aid and the roots of scarcity," BUSINESS DAY, 2 February 2007; "Showdown ahead on Bush's bid for food aid reform," REUTERS, 2 February 2007; "EU criticizes US farm policy proposals," EURACTIV.COM, 1 February 2007; "Aid groups say Bush budget skimps on hunger relief," REUTERS, 5 February, 2007; "FAO urges food aid reform." FAO NEWSROOM, 24 January 2007.