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Press Release 99/72 C/7

FAO'S 2000-2001 BUDGET SET AT $650 MILLION BY ORGANIZATION'S 180-COUNTRY GOVERNING CONFERENCE


Rome, November 19 - The UN Food and Agriculture Organization (FAO) today received a budget of $650 million for the years 2000-2001 from the Organization's 180-country governing Conference. The budget has stood at $650 million since 1996-97. Retaining the same budget allocation for 2000--2001 will force the Organization to absorb estimated cost increases of about $4 million.

The vote for the budget was 105 votes in favor, none against.

The Conference also authorized an advance of up to $9 million against expected payment of arrears by a major donor country. The advance is "to cover redeployment and separation costs as may be necessary, as a one-time expenditure, to complete restructuring pending the eventual receipt of assessed contributions in arrears from the major contributor."

The amount of arrears that FAO is owed totals some $150 million. Of that amount, one donor country owes about $95 million.

For 2000-2001, FAO Director-General Jacques Diouf submitted three budget scenarios to the Conference for consideration. One, the adopted budget, was zero nominal growth, maintaining the Organization's budget at $650 million, which effectively was a cut of $14.9 million when inflation and other cost increases are taken into account. The second, a zero-real growth budget, allowing for the projected cost increases, was set at $664.9. The third budget proposal, at $687 million, includes $22.6 million for activities requested by FAO's governing and advisory bodies, which FAO could not accommodate under zero real growth conditions.

However, since the budget proposal was printed, the strengthening of the US dollar reduced projected inflation and other cost increases to just about $4 million. This, plus the authorization to use $9 million against repayment of arrears, led to the passage of the compromise budget appropriation.

The budget supports FAO's efforts to carry out its mandate from the 1996 World Food Summit to help reduce the number of people in the world who are hungry and malnourished, particularly in the developing countries. It also supports FAO's programs in the sustainable development of the world's agricultural, fisheries and forestry sectors.

Many of the documents under discussion at the Conference are available on the FAO Web site at: http://www.fao.org/unfao/bodies/conf/C99/C99-e.htm

Contact:

John Riddle, FAO/Rome
Tel. (39) 06 5705-3259
e-mail: john.riddle@fao.org


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