ERC/02/3





TWENTY-THIRD FAO REGIONAL CONFERENCE FOR EUROPE

NICOSIA, CYPRUS, 29-31 MAY 2002

Agenda Item 5

WORLD FOOD SUMMIT FOLLOW-UP

Table of Contents


THE WORLD FOOD SUMMIT: FIVE YEARS LATER
1. The World Food Summit, convened at FAO headquarters in Rome in November 1996, provided a forum for debate on one of the most important issues facing world leaders in the new millennium - the eradication of hunger. The Summit adopted the Rome Declaration on World Food Security and the World Food Summit Plan of Action and the Heads of State or Government or high-level representatives attending the Summit pledged their political will and their commitment "to achieving food security for all and to an on-going effort to eradicate hunger in all countries, with an immediate view to reducing the number of undernourished people to half their present level no later than 2015". Despite commitments made, by 2000, four years after the Summit, it was clear that the goals of the Plan of Action were not being met. It was therefore decided to convene a meeting at the highest political level to give new impetus to the implementation of the Plan of Action, the World Food Summit: five years later (WFS:fyl).
2. In preparation for the WFS: fyl, the Regional Conferences have been asked to address the twin themes of mobilizing the political will to fight hunger and of mobilizing resources for agricultural and rural development, and to forward to the Committee on Food Security their views on the action necessary to ensure achievement of the World Food Summit’s goals. The purpose of this document is to present material which may be of use in focusing the attention of the Conference on the dimensions of food insecurity in the European region and actions necessary for the achievement of the World Food Summit’s goals. It concentrates on the food security situation in the transition economies, because in the European Region these are both the poorest countries and the ones facing the largest problems of undernourishment. It does not analyze developments in transition economies which fall within other FAO regions, since these countries are presumably dealt with in other regional conferences. However, it does analyze developments within a few non-member countries within the European region (Russia, Ukraine and Belarus), because of the importance of these countries in resolving problems of food insecurity in the region.
3. The analysis that follows considers the transition economies as a group in recognition that these countries have many problems in common. However, as will be shown, there is also considerable diversity in the region. The European Union accession countries can hardly be said to suffer from undernourishment on a scale approaching the poorest countries of the region in the Caucasus. Likewise, there is great diversity in the degree to which undernourishment can be addressed by policies in rural areas. Moreover, there is diversity in the policies pursued in the region which have a bearing on food security and on the institutions of the countries of the region and their ability to respond to problems. All these sources of diversity have policy implications for the manner in which countries of the region can best address food security problems. Diversity in the region also affects the priorities of FAO in addressing food security problems.
4. The principal causes of food insecurity in the European region have been as follows:
(i) man-made disasters (war and conflict, with ensuing problems of refugees and displaced persons, in former Yugoslavia, Azerbaijan, Armenia, Georgia, Moldova and Russia),
(ii) poverty (primarily in the Caucasus countries and some Balkan countries),
(iii) natural disasters (prolonged drought in areas of Azerbaijan, Armenia, Georgia and Moldova) and

(iv) weak state institutions to ensure the safety of food from the farm to the table. Structural issues are connected with the restructuring of state institutions to provide public goods required for a functioning market economy, and includes state organizations for inspection of plants and animals to protect against trans-boundary diseases, state food safety inspection, etc.
(v) breakdown of social safety nets in the region.
5. This paper uses the percent of population undernourished as an indicator of food insecurity to be used for comparison among countries. FAO’s measure of the prevalence of undernourishment is based on the distribution of food consumption within a country, whereas the usual measures used to estimate poverty are based on the distribution of expenditure on consumables. There is a close relationship between food consumption and expenditure on consumables in low-income households. This is consistent with the widely-shared belief that the undernourished are found largely among the extreme poor. In the European region, as in so many other areas of the world, poverty has been correlated with most of the other causes of food insecurity, such as weak state institutions, vulnerability of the population to natural disasters and man-made disasters.
6. The transition countries of the FAO European region share a region wide common experience of an increase in poverty in the past decade. However, these countries are also quite diverse in the degree of undernourishment, in the degree of urbanization and in the incidence of poverty. The diversity of the region and our lack of robust data on the sources of undernourishment there make it quite difficult to prescribe general policies to address undernourishment in the region. Instead, in the following sections an attempt is made to identify in which sub-regions most of the undernourished are located and, based on a profile of countries with high undernourishment, identify policies for addressing undernourishment in the region as a whole.

A. POVERTY AND UNDERNOURISHMENT IN THE EUROPEAN REGION TRANSITION COUNTRIES IN WORLD COMPARISON

7. GDP fell dramatically in transition economies at the beginning of the 1990s and poverty rates rose. According to World Bank figures, only two regions in the world registered increases in absolute rates of poverty in the 1990s (percent of population living on US$1 or US$2 per day), Eastern Europe and Central Asia and Sub-Saharan Africa.1 For the transition countries the rise in poverty was quite substantial in percentage terms. From 1987 to 1998 the percent of the population living on less than US$2 per day increased from 3.6 to 20.7 percent. However, the level of poverty in transition countries is still quite low, compared to that in developing countries. The portion of people living on less than US$2 per day in Sub-Saharan Africa and South Asia, the two poorest areas of the world, is four times that in Eastern Europe and Central Asia.

8. Estimates made by FAO of undernourishment are in line with the relatively low rates of absolute poverty in the region as a whole.2 Despite rising poverty in the region, undernourishment is not high by developing world standards. The percent of undernourished in the region as a whole is estimated at 6 percent in 1997-99, compared to an average level of 17 percent for the entire developing world. Transition countries, like those in Latin America and the Caribbean, are middle income countries, by and large. Average per capita GDP in purchasing power parity terms for the transition economies was US$6,170 in 1999. This compares with GDP per capita in Latin America and Caribbean countries of US$6,817, US$1,600 in Sub-Saharan Africa, US$5,109 in the Near East and N. Africa and US$2,115 in South Asia.3 As middle income countries, transition countries have relatively non-agricultural economies. The value added from agriculture in the region was only 10 percent in 1999. This is smaller than the share of agriculture in GDP in many countries of the developing world. The portion of GDP derived from agriculture in Sub-Saharan Africa was 15 percent in 1999, the portion for South Asia, 27 percent. Transition countries are most comparable to Latin America in terms of the role of agriculture in GDP, where the percent of agriculture in the economy was only 8 percent in 1999.4

B. DIVERSE LEVELS OF POVERTY AND UNDERNOURISHMENT IN EUROPEAN TRANSITION ECONOMIES

9. European region transition economies show a great deal of diversity with regard to poverty rates and the incidence of undernourishment. There are countries in the region in which poverty and undernourishment are as severe as in developing countries. Azerbaijan and Armenia, in particular, have very high rates of both poverty and undernourishment. Georgia, Croatia, Albania, Bulgaria and Moldova, as well, all have relatively high undernourishment rates by world standards. Moldova stands out as the country with the highest rate of absolute poverty in the region. Despite its moderate rate of undernourishment (6 percent), the Russian Federation has the largest number of undernourished. This mainly reflects the fact that the Russian Federation is the largest country in the region.
10. With regard to the regional average rates of undernourishment, Eastern Europe is in a slightly better position than the Caucasus. The countries of Eastern Europe have undernourishment rates of 5 percent and below, except for Croatia, Bulgaria and Albania. These countries also have relatively low absolute rates of poverty. The percent of the population in these countries living on US$2 or less per day is less than 8 percent, except for Albania. Table 1 shows the picture of undernourishment in the European region by country along with the World Bank poverty indicator of the percent of individuals living below US$2 (actually, US$2.15) per day and the GDP per capita in 1999 in purchasing power parity (PPP) terms. Purchasing power parity levels of GDP reflect the actual buying power of incomes in the country in relation to the US dollar, compensating for currency under or overvaluation. It is important to consider GDP in purchasing power parity terms particularly for this region, because currencies there tend to be undervalued. On average, PPP GDP for countries in the region are three times that of GDP in US dollars using the official exchange rate.

Table 1. Undernourishment, Poverty and Income in Transition Economies of the European Region






Year

(1)

(2)

(3)

(4)

Undernourishment

Percent of population below

Per Capita GDP, PPP(Curr USD)

Millions

Percent

$2.15/day

 

1997-99

1999

1999

Azerbaijan

2.9

37

23.5

2,850

Armenia

1.3

35

43.5

2,215

Georgia

1.0

18

18.9

2,431

Croatia

0.7

15

0.2

7,387

Bulgaria

0.9

11

3.1

5,071

Albania

0.3

10

11.5

3,189

Rep of Moldova

0.4

10

55.4

2,037

Russian Federation

8.1

6

18.8

7,473

TFYR Macedonia

0.1

5

6.7

4,651

Ukraine

2.6

5

3.0

3,458

Yugoslavia

0.5

5

   

Bosnia and Herzegovina

0.2

4

   

Estonia

0.1

4

2.1

8,355

Latvia

0.1

4

6.6

6,264

Lithuania

0.1

3

3.1

6,656

Slovakia

0.1

2

2.6

10,591

Romania

0.3

1

6.8

6,041

Hungary

0.1

1

1.3

11,430

Belarus

0.1

1

1.0

6,876

Czech Rep

0.1

1

0.0

13,018

Poland

0.3

1

1.2

8,450

Slovenia

0.0

0

0.0

15,977

Shaded areas indicate FAO non-member countries.

Sources: FAO State of Food Insecurity, 2001; World Bank, Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia (Washington, D.C., 1997: World Bank); World Bank World Development Indicators Database (2002).
11. Table 1 has profound implications for the regional orientation of FAO activities in Europe. There are 9.5 million undernourished in the entire transition country FAO-membership of the European region. Nearly 60 percent of those are located in 4 countries--Azerbaijan, Armenia, Georgia and Moldova. Another third are located in the Balkan countries. Slightly less than 10 percent of undernourished are located outside of Caucasus, Moldova and the Balkans. In addition, one non-member country, the Russian Federation, has nearly as many undernourished as the entire transition country FAO European region.

C. AGRICULTURE AND UNDERNOURISHMENT IN THE FAO EUROPEAN REGION

12. In order to formulate or recommend policies to address problems of undernourishment, it is important to know whether hunger is primarily a rural or urban problem in the transition countries of the European region. Data on undernourishment for the region do not allow us to establish this basic point directly. Though World Bank surveys conducted in the late 1990s have shown that residents of rural areas were at slightly more risk of poverty than those in urban areas, undernourishment does not necessarily follow the same pattern.5 There is a long tradition in the region that rural residents have access to land in sufficient quantities to feed themselves. In the transition country FAO European region all governments have privatized former state and collective farms, and the land distribution process has been specifically structured to ensure that all claimants to land through restitution, distribution or land auctions received some land. Even in the Russian Federation, where reforms have included farm privatization, though not in-kind distribution of the land or assets of socialist-scale farms, undernourishment is primarily an urban problem.6 This is despite the fact that rural incomes in that country are, on average, far below those in urban areas.

13. A profile of countries with high levels of undernourishment can be constructed by inspecting data related to agriculture along with the undernourishment indicator. Table 2 shows a number of agricultural indicators and the percent of the population undernourished. The fourth column of Table 2 indicates that undernourishment of the population in the transition economies does not seem to be related to how the population is distributed between rural and urban areas. Both high and low undernourishment countries have large rural populations. This would seem to indicate that undernourishment is not necessarily connected with how urban or rural the country is. However, the percent of undernourished population seems to increase along with the portion of the labor force in agriculture and the portion of GDP from agriculture (columns 2 and 3). If it is assumed that Armenia and Georgia have similar labor forces as Azerbaijan, nearly every country in which the portion of undernourished population exceeds 10 percent seems to have a relatively agricultural-intensive labor force. The sole exception for the region is Croatia. These countries in which the portion of undernourished exceeds 10 percent and in which the labor force is agricultural-intensive account for 72 percent of all undernourished in the FAO European region (the three Caucasus countries, Bulgaria, Albania and Moldova). Though undernourishment does not appear to be primarily a rural phenomenon, in these countries, because of the large share of agriculture in GDP, growth of agriculture can have a significant effect on overall GDP, and therefore can be quite important in reducing poverty and undernourishment.

Table 2. Agriculture and Undernourishment in Transition Economies







Year

(1)

(2)

(3)

(4)

(5)

Undernourished
Population
(percent)

Labor Force in Agriculture
(percent)

Value Added in Agriculture
% of GDP

Rural Population
(percent of total)

Percent of Cropland Irrigated

1997-99

1998

1999

2000

1998

Azerbaijan

37

29

23

43

75

Armenia

35

43

29

30

51

Georgia

18

52

36

39

44

Croatia

15

17

9

42

0

Bulgaria

11

26

15

30

18

Albania

10

 

53

58

49

Moldova

10

46

25

 

14

Russian Federation

6

 

7

22

4

Macedonia, FYR

5

 

12

38

9

Ukraine

5

26

13

32

7

Yugoslavia, FR

5

       

Bosnia and Herzegovina

4

 

15

57

0

Estonia

4

10

6

31

0

Latvia

4

19

4

31

1

Lithuania

3

19

9

32

0

Slovak Republic

2

8

4

43

11

Romania

1

40

16

44

29

Hungary

1

8

6

 

4

Belarus

1

 

13

 

2

Czech Republic

1

 

4

25

1

Poland

1

19

3

34

1

Slovenia

0

12

4

50

1

Notes: In column, 2 Armenia figure is from 2000. In column 3, Hungary figure is from 1998
Shaded areas indicate FAO non-member countries.
Sources: column 1. FAO. State of Food Insecurity, 2001; World Bank World Development indicators (2001). For Armenia and Georgia in column 2 source is: Interstate Statistical Committee of the Commonwealth of Independent States. 2001. Ten Years of the Commonwealth of Independent States (1991-2000). The figure for Azerbaijan from this source for column 2 in 2000 is 41 percent.
14. In summary, agriculture is quite important and undernourishment high in percentage terms in the three Caucasus countries, Bulgaria, Albania and Moldova. For these countries development of private sector agriculture as well as non-farm development in rural areas would have a substantial effect on overall economic growth, thus reducing the number of undernourished. In this respect sectoral agricultural policies can play a useful role in reducing the number of undernourished. A lack of apparent correlation of other agriculture-related indicators with the percent of undernourished in the region attests to the complex nature of the undernourishment problem in the region. The percent of undernourished population for transition economies does not vary with measures of capital formation in agriculture, such as the percent of foreign direct investment in agriculture, or direct assistance to agriculture. It does not seem to vary with added value of agricultural products per person employed in agriculture. The percent of undernourished is also not correlated with World Bank indices of the progress of agricultural reform in the transition countries.

D. INSTITUTIONS AND UNDERNOURISHMENT IN THE
FAO EUROPEAN REGION

Table 1. Institutions and Undernourishment in Transition Economies







Year

(1)

(2)

Undernourished
Population (percent)

Credit to private sector (% of GDP)

1997-99

1999

Azerbaijan

37

3

Armenia

35

9

Georgia

18

8

Croatia

15

37

Bulgaria

11

15

Albania

10

4

Moldova

10

12

Russian Federation

6

11

Macedonia, FYR

5

22

Ukraine

5

9

Yugoslavia, FR

5

 

Bosnia and Herzegovina

4

 

Estonia

4

26

Latvia

4

17

Lithuania

3

13

Slovak Republic

2

37

Romania

1

8

Hungary

1

25

Belarus

1

10

Czech Republic

1

57

Poland

1

24

Slovenia

0

36

Shaded areas indicate FAO non-member countries.
Sources: FAO. State of Food Security, 2001; World Bank World Development indicators (2001).
15. One of the key characteristics of poverty and undernourishment is that the political and economic means to address its problems are often least available or effective in those countries in which the problem is greatest. Table 3, column 2 shows the development of the financial system for financing private enterprise. Credit to the private sector refers to financial resources provided to the private sector, such as through loans, purchases of nonequity securities, and trade credits and other accounts receivable, that establish a claim for repayment. For some countries these claims include credit to public enterprises. Research has shown that there are also serious problems with state institutional capacities as well. The restructuring of state institutions to better serve private agriculture by providing public goods has been slow and difficult in the transition economies.
16. Table 3 illustrates that in countries in which hunger is most prevalent, the ability of financial institutions to assist in development is quite limited. The sole exception to this generalization seems to be Croatia. Unfortunately, weak institutions for assisting in development usually go hand in hand with a lack of ability to better the situation.
17. The Rome Declaration and World Food Summit Plan of Action placed food security in a broad context. It acknowledged the multifaceted character of food security, emphasizing the linkage with poverty eradication, peace, sustainable use of natural resources, fair trade and the prevention of natural disasters and man-made emergencies. Taking into account the specific features of undernourishment in the European region, these commitments seem to translate into a number of key policy issues, all of which are interrelated and capable of making a difference in the alleviation of undernourishment. The following list is not intended to be exhaustive, but seems to cover the main issues.

A. THE CRITICAL ROLE OF LAND

18. All the transition countries of the FAO European region with large agricultural sectors have already taken the step of decollectivizing agriculture. The development of agriculture now depends on the formation of a thriving class of commercial farms with enough land and resources to produce competitive products for domestic sales and export. The experience of other developed countries seems to support a certain (rather wide) range of farm sizes appropriate for modern, competitive commercial farming. “Micro” farms below 0.5 ha produce primarily for themselves, and are thus not part of commercial agriculture. Large socialist-type farms have not been sustainable in Western countries. Between these two extremes lie what may be called “middle class” farms, neither “micro farms” nor socialist-like behemoths. The government can assist the development of a viable agriculture by assuming a proactive role in facilitating the operation of land markets, registration of land parcels, clarification of land property rights in order to allow competition to alter the structure of farming, including allowing uncompetitive individual and corporate farms to fail.
19. Land consolidation after farm privatization is relevant to food security enhancement particularly for those countries identified earlier with large agricultural sectors and significant problems of undernourishment. Land consolidation is needed in the region, because land plots were granted or sold to farmers in the process of land privatization in the form of numerous scattered land parcels. This has created high transaction and other costs for farmers in the region, directly as a result of how land was distributed. In fact, land consolidation is relevant for most countries of the region, but has added relevance for the more food insecure countries. Land consolidation promises to become a key policy issue in the countries of the region in the years to come.
20. A third issue concerning land is irrigation. Most countries with high rates of undernourishment have a high portion of cropland under irrigation. This apparent link has important policy implications for the region. It means that in order to address undernourishment, both FAO and the countries themselves will have to address the problem of restructuring irrigation systems in order to serve private farming. Agriculture in these countries was formerly dominated by large collective and state farms, and the irrigation systems there were structured to serve these farms. Reorientation of irrigation systems means both rebuilding them and constructing new institutions, such as water user associations, in order to finance irrigation systems.

B. POVERTY ALLEVIATION

21. The fact that undernourishment is highest in countries with large agricultural sectors (the three Caucasus countries, Bulgaria, Albania and Moldova) indicates that growth of agriculture and the non-farm economy in rural areas can contribute significantly to GDP growth and therefore to poverty reduction. In these countries poverty can be addressed with rural development policies designed to develop off-farm employment opportunities for rural inhabitants. Policies and programs to support land consolidation as well as programs to restructure irrigation systems and form water user associations can also assist in reducing poverty in the countryside.
22. Poverty can not be dealt with as a sectoral phenomenon, even if it may be more severe in rural areas. Poverty alleviation requires long term economic growth and peace. It is not incidental that the countries involved in conflicts in the region (the Caucasus countries, former Yugoslavia and Moldova) had some of the steepest slides in economic growth. Long term economic growth can be achieved by pursuing policies aimed at ensuring macroeconomic stability and encouraging both domestic and foreign private investment. Other important policies for economic growth in the region are privatization and restructuring of state institutions to assume regulatory and public good roles. Transition country governments, even those in Eastern Europe, continue to play a larger role in the economy than in countries of Western Europe. There is therefore scope for further economic growth by continued reduction of the role of the state in ownership and management of firms. However, liberalization does not mean complete laissez-faire. Governments of the region must also assume the tasks of regulation and supply of public goods to support the development of a market economy.

C. CONFLICTS AND EMERGENCIES

23. It was mentioned above that emergencies, both man-made and natural, have been some of the main causes of food insecurity in the region. The principal food security problem caused by the Nagorno-Karabakh conflict between Armenia and Azerbaijan (1988-1994) created approximately 1 million refugees and internally displaced persons (IDPs). Conflicts in North and South Ossetia (Russia and Georgia), Ingushetia (Russia), Abkhazia (Georgia), Chechnia (Russia), the Transdniester region of Moldova, as well as the series of conflicts in former Yugoslavia have all created massive refugee and IDP problems.
24. In addition to man-made emergencies, food security in the European region has been threatened by natural disasters. In the past two years persistent drought in Armenia, Georgia and Moldova, floods in Bosnia and Herzegovina, as well as vulnerability to natural disasters because of emergencies prompted by conflict have caused severe food insecurity in specific regions in Europe.

D. TECHNOLOGY TRANSFER AND FOREIGN INVESTMENT

25. Foreign investment and ownership in food processing has been an important force for restructuring food production in many countries of the region along market economy lines. In Hungary, Poland, the Czech Republic, the Slovak Republic, the Baltic states, The Russian Federation and Ukraine foreign investment and ownership have brought new technologies and export opportunities to the food industry, which have had significant effects on the organization of production and income opportunities of primary agriculture.
26. Political and economic instability in the Caucasus and Balkan regions, higher incomes and a more friendly environment for foreign investment in the Central European transition countries, as well as problems in the privatization of food processing has limited foreign investment in the Caucasus and Balkan countries in agro industry. Yet this region traditionally exported large quantities of food to Russia, Ukraine and other ex-Soviet countries, and the Caucasus countries are well placed to export to the Near East and Central Asia. Political stability, the creation of an enabling environment and greater opening of these countries to trade should create new opportunities for the development of agriculture.

E. RESTRUCTURING STATE INSTITUTIONS TO PROVIDE
PUBLIC GOODS

27. Robust liberalization of the former socialist economies has resulted in admirable levels of economic growth for a number of years in many of the countries of the region. At the same time, liberalization created two important problems with implications for food security. First, liberalization was accompanied by an unprecedented rise in poverty in the region. Second, liberalization created a need to restructure state institutions to meet the challenge of regulation and provision of public goods in the economy. Properly functioning market economies require a reliable court system to settle contract disputes, hard budget constraints and fair and clear bankruptcy legislation. Moreover, a well functioning land market requires clear property rights legislation. These institutional supports reduce risk in a market economy, thus reducing costs for entrepreneurs, investors and financial institutions to operate. Reduced risk and lower costs can translate into higher economic growth.
28. The ability of the state to fulfill these tasks aimed at reducing risk, depends a great deal on the quality of state institutions in the country. It was shown in Table 3 that financial institutions in the countries most vulnerable to undernourishment and poverty seem to be least suited to provide public goods. The best way to overcome the limitations of an underdeveloped financial sector is to create a competitive, trade oriented economy, through investment, friendly policies and clear role for government ministries as suppliers of public goods.

F. GLOBALIZATION AND TRADE

29. The portion of undernourished in the transition economies is negatively correlated with the ratio of trade (the sum of merchandise imports and exports) to GDP in purchasing power parity terms. In other words, the countries with the highest rates of undernourishment are also the least trade oriented. For instance, the ratio of trade to GDP in Azerbaijan was a mere 9 percent in 1999, while the same ratio was 59 percent in Estonia, 38 percent in the Slovak Republic and 58 percent in Slovenia.7
30. The comparative economic isolation of the countries most subject to food insecurity can be viewed as another symptom tending to perpetuate poverty in these countries or as an opportunity for economic growth. There is much evidence indicating that developing countries that have been successful at economic growth and poverty alleviation are more open to trade. More open economies in the Caucasus countries, are therefore, a potential means for increasing growth and alleviating poverty.

G. FOOD SAFETY

31. The food quality and safety systems and institutions of many transition countries suffer from a number of weaknesses which make them vulnerable in addressing food safety and quality issues. The weaknesses include all the basic elements of an effective national food control system including: basic infrastructure; national food safety and quality strategies and policies: food legislation; food inspection services; food control laboratories; effective participation in the work of international standard setting and trade related organizations; implementing quality and safety assurance systems throughout the food chain; collaboration and cooperation of national and sub-national agencies; and scientific and technical expertise. Ensuring food safety is an important role for the state in ensuring the food security of the population. Unfortunately, the institutions to ensure food safety are weakest precisely in those countries which need them the most, the ones with the highest levels of poverty and food insecurity.

A. THE PROGRESS OF COUNTRIES IN REDUCING UNDERNOURISHMENT

32. FAO attempts to gauge the progress of member countries in reducing undernourishment. However, for most transition countries it has not proven possible to compute undernourishment figures for the critical base period for WFS goals of 1996. In fact, for the transition countries only two years of data on undernourishment (1996/98 and 1997/99) are available. It is therefore not possible to gauge the progress of these countries in reducing food insecurity directly.
33. Absent such a direct indicator of progress toward alleviating undernourishment, an indicator which may suggest progress in reducing undernutrition in these countries is overall economic growth, and for the countries for which agriculture is important, agricultural growth. Using these two indicators, from 1993 to 2001 the countries with the most severe problems of undernourishment in the region actually did quite well compared to other countries of the region. Azerbaijan, Georgia, Armenia, Croatia and Albania had both positive overall growth and positive growth in agriculture, despite problems of land fragmentation resulting from land reform. Bulgaria and Moldova have had much less impressive records, with negative overall and agricultural growth between 1993 and 2001.
34. Other countries which have had positive growth of GDP and agricultural production in these years have been Hungary, the FYR of Macedonia, Slovenia and Romania. Despite recent growth, Russia and Ukraine have had negative growth of both GDP and agricultural production from 1993 to 2001. The rest of the countries of the region had positive GDP growth, but negative growth in agricultural production from 1993 to 2001.
35. Addressing undernourishment in the FAO European region requires both identification of the source of the problem and policies to deal with them, as well as finding the political means to resolve the problem. It has been noted that in the countries where undernourishment is most severe, state institutions also seem to be least adept at addressing these problems through reliable and professional economic regulation and providing public goods, such as a reliable court system to settle contract disputes, clear property rights legislation, etc. At the same time, it has been noted that the poorest countries seem to have some of the best (GDP and agricultural) growth records. Political leaders today can address undernourishment resulting from poverty by creating a competitive, trade oriented economy, through investment, friendly policies and clear role for government ministries as suppliers of public goods. Combined with durable peace, such policies can foster growth in both GDP and agriculture to address undernourishment in the countryside and in urban areas.
36. Mobilizing resources to address food insecurity in the region is primarily a problem of creating an enabling environment for private agriculture and rural development in the countries where agriculture is important (the Caucasus countries, Albania, Bulgaria and Moldova). In addition, the governments of these countries can assist by funding agricultural extension, formulating realistic rural development policies to address rural poverty and further opening their countries to trade with the world.
37. FAO can assist in designing and providing technical assistance for some of the actions necessary for increased food security in the poorest countries of the region. However, the country governments themselves have the primary role to play in mobilizing resources to address food security in their countries. The more privileged countries of the European region, can also assist by contributing to efforts covered above. Chief among these for the poorest countries of the region are projects to restructure irrigation systems, projects for capacity building in food safety and regulation and projects related to land consolidation.

1 World Bank. 2001. Poverty Trends and Voices of the Poor (Washington, D.C.: World Bank).

2 FAO, State of Food Insecurity, 2000, 2001

3 World Bank World Development Indicators (2000).

4 World Bank World Development Indicators (2000).

5 World Bank. 2000. Making Transition Work for Everyone: Poverty and Inequality in Europe and Central Asia (Washington, D.C.: World Bank). The exceptions to this generalization were the Czech Republic, Ukraine and Armenia. No figures were available for the Slovak Republic, Uzbekistan or Slovenia.

6 Sedik, D., S. Sotnikov and D. Wiesmann. 2002. The State of Food Security and Prospects for Improvement in the Russian Federation, unpublished draft technical report under DFID funded technical assistance project: OSRO/USR/901/UK.

7 World Bank World Development indicators (2001).