The Council considered the statement submitted by the Director-General describing the changes in the food and agriculture situation which have occurred since the last Conference session, and discussed the salient aspects of the present position. The text of the statement is appended (Appendix B, page 37).
The Council reviewed the Report of the Working Party on the Program of Work and Associated Long-Term Problems which, in accordance with the decision of the Council at its Eleventh Session, was to be presented to the following session of the Council, and also, in accordance with the decision of the Special Session of the Conference, was to be circulated to member governments four months before the Sixth Conference Session.
The Council had instructed the Working Party to initiate a thorough study of the following problems, together with associated longterm problems:
The degree to which effective decentralization of the work of the Organization can be carried out without reducing its efficiency and involving duplication.
The extent to which increased use can be made of universities, research institutions, and other organizations, in implementing the Organization's program, and the possibility of utilizing temporary consultants on a larger scale while maintaining fewer permanent technical officers on the staff.
The planning of FAO's activities in such a way as to achieve maximum co-ordination with the United Nations, its regional commissions (Economic Commission for Europe, Economic Commission for Asia and the Far East, Economic Commission for Latin America), and the other Specialized Agencies in fields in which FAO is specially interested.
The collection of information from member countries, particularly in the form of the annual reports requested by Article XI of the Constitution, and the use of this material in framing the Program of Work, in implementing FAO's work projects, and in advising member governments.
The relative importance to be given to activities of the Organization in the several fields of its competence, the long-term policies to be adopted within those different fields of activity, and the priorities to be followed in deciding upon different projects in these fields, with special reference to the considerations set out in the introduction to the Program of Work.
The Council had also decided that the Working Party should advise the Director-General on the formulation of the Program of Work and Budgets for 1952 and 1953, and report to the Twelfth Session of the Council.
The Council paid tribute to the thorough and painstaking study which the Working Party had undertaken of the principles to be adopted in planning the Organization's Program of Work, and to the Working Party's examination of the draft Program of Work for 1952 and 1953, which had been prepared by the Director-General. It endorsed the principles laid down by the Working Party for planning future programs, taking note of the suggestion of the South African Delegate that, as a matter of general principle, the Organization should at all times maintain efficient and effective services for the collection, analysis, and dissemination of information relating to the functions of the Organization, so that governments may make their own appraisals in determining their policies. These services should be of such a standard as to enable the Organization to give guidance on the problems of food and agriculture facing the world.
The Council also endorsed the comments made by the Working Party on the Draft Program of Work submitted by the Director-General for 1952 and 1953, and noted that the Director-General proposed to redraft the Program, taking into account the comments of the Working Party, before circulating it to member governments in advance of the Sixth Session of the Conference (beginning 19 November 1951). The Council generally approved of the distribution of the Organization's resources over the different divisions and services and throughout the different phases of work. At the same time it emphasized the desirability of maintaining flexibility so that there is provision to meet changing circumstances and unforeseen contingencies.
The Council reviewed the recommendations made by the Working Party regarding longer term constitutional, organizational, and technical activities, in particular:
(a) The obligation placed upon member countries by Article XI of the Constitution to report to each other on progress in achieving the purposes of the Organization through action taken as a result of recommendations made and conventions submitted by the Conference.
(b) The proposed replacement of the present form of the Standing Advisory Committees and the Co-ordinating Committee, with a new Committee of the Council which would assist the Council in reviewing the Program of Work in the years in which no regular sessions of the Conference are to be held.
Discussing, in connection with Article XI Reports, the progress made toward achieving the purposes of the Organization, the Council noted that Article XI of the Constitution provides for two types of report: the regular periodical reports required under paragraphs 1 and 2 of Article XI, and the specific information and other material which the Director-General can request under paragraphs 4 and 5. So far as the former was concerned, the Council felt that there was much value in the acceptance by member governments of the obligation to report to each other on the extent to which they were adopting measures to further the objectives of the Organization. At the same time it recognized that the techniques adopted in the past had not been successful in achieving the objectives embodied in the Constitution. Moreover the preparation of the reports on the lines at present in force entails considerable work on the part of member countries, work which would not be justified if the reports fail to serve the purpose for which originally they had been prescribed.
The Council therefore recommends that all member countries should give special attention to this question with the object of participating in a full discussion at an early stage of the Sixth Conference Session, when all aspects of the problem could be examined.
As to the discontinuance of the present form of the Standing Advisory Committees and the Co-ordinating Committee, the Council was of the opinion that careful consideration should be given to the proposals of the Working Party before any decision is taken. On the one hand it was felt that the Organization could not fail to benefit from direct and close contact with leading technicians in the various fields of work covered by FAO's responsibilities; on the other hand it was recognized that with the development of the Organization and the building up of its own technical staff, Standing Advisory Committees in the form originally adopted were no longer providing the services they originally supplied, and moreover that the calling of meetings of such committees involved a heavy strain on the limited resources of the Organization.
An observation was also made that the Standing Advisory Committees were intended to exercise a general advisory influence over the technical programs of work, which neither the proposed committee, nor ad hoc consultation with individual specialists by the Director-General could provide.
On the other hand it was pointed out that the proposed committee would not examine the Program of Work in its technical aspects. It would consist of individuals with wide practical experience of FAO's work and responsibilities and its role would be to review the Program in relation to the objectives of the Organization and the principles laid down by the Working Party. Concerning this concept, some doubt, however, was expressed as to the value of a Committee of the Council for examining the Program of Work, even during the years in which no regular session of the Conference will be held, particularly if such a committee is not composed of technicians.
The Council urges all governments to give special consideration to this question so that it can be fully considered at the Sixth Session of the Conference.
The Council generally endorsed the comments and recommendations of the Working Party with regard to the importance of securing increased co-ordination between the divisions of FAO, developing greater co-operation with outside Organizations, utilizing universities and research institutes, etc., for the delegation of work, and developing of FAO National Committees as a means of establishing effective working relations with member countries.
The Council noted the comments of the Working Party on the financial resources of the Organization in relation to its responsibilities, and recognized that if FAO is to play an effective part in carrying out the obligations entrusted to it, provision must be made to meet its progressive development. At the same time emphasis was laid upon the heavy cost to member countries in consequence of their contributions to the United Nations and to the other international organizations, among which FAO's role was agreed to be one of special importance.
The Council urges all member countries to give special consideration to the observations of the Working Party on the subject of FAO's financial resources and also the related memorandum by the Director-General (CL12/23) so that a full discussion can take place at the next session of the Conference.
Since first the Food and Agriculture Organization was conceived at Hot Springs, its broad objectives have been to gain “freedom from want of food, suitable and adequate for the health and strength of all peoples”1 and to contribute “towards an expanding economy”2.
Achievement of these ends requires the full and intelligent use of all the resources of land, labor, and capital of the member nations: to the extent that these resources are utilized depends the continuous expansion of production which is needed to provide for rising standards of living and welfare for countryman and townsman alike. The task is manysided; in some directions, the decisions which FAO can make for itself are major contributions in the battle to win freedom from want; in others the Organization can in greater or lesser degree serve to round out and complete the actions of other bodies working toward the same end.
The Twelfth Session of FAO's Council received and considered a number of reports which in essence bear upon this general idea of the better use of resources in agriculture. The subjects of these reports were Full Employment, Fundamental Education, Land Tenure, Migration and Land Settlement, Technical Assistance to Underdeveloped Countries, and International Investment. The documentation was large, and several of the important papers put before the Council coming from other sources (e.g. the Provisional Report on Agrarian Structure, the Experts' Report and the Report of the European Commission) could not be made available before the Council began its business. Therefore Council members were not in a position in all cases to come to considered and generally accepted views on many of the numerous ideas and suggestions to which this material gives rise. Nevertheless, the Council's deliberations on these reports showed clearly that whatever might be the approach of its several members to the matters raised in them, the subjects themselves were of relevant and pressing interest to member nations at large.
2 Preamble to the Constitution of the Food and Agriculture Organization of the United Nations.
Shortcomings in the full and efficient use of labor in industry and trade no less than in agriculture leave the world poorer in foodstuffs and other goods than it might otherwise be. The paper before the Council (CL12/11) reported on the contribution of the Organization in response to Resolution 290, providing for studies relating to full employment, passed by the Economic and Social Council on 11 August 1950. It also met the request of the Council for material on which it might base discussion about the interests of FAO in this question. The Council took note of the co-operation of FAO with the United Nations on Resolution 290 and strongly reaffirmed its interest and desire to see this co-operation continued.
Discussion on the paper before it emphasized the somewhat divergent nature of the problems involved, which concern both the more developed and the less developed countries.
Since the problem of full employment in more advanced countries has been extensively examined in recent years and national and international policies and administrative techniques for aiding full employment have been widely adopted, the Council decided to limit its discussion to the employment problems of the underdeveloped countries.
In underdeveloped countries poverty and economic backwardness create conditions quite different from those existing in countries that are economically more advanced. A large part of the working population, averaging 70 percent, is engaged in agriculture. The farmers producing commodities for export are subject to a severe reduction of income if business declines elsewhere; the effective export demand for their products is reduced, thus lowering both the volume and the prices of exports. In the domestic market the demand for farm products is affected by the comparative lack of development in industrial and other urban employment and the limited opportunity for employment off the land, as well as by the low level of production per caput and the consequent low income and low purchasing power of the nonfarm population. Because of the limited opportunity for gainful employment elsewhere, many more people remain on the land than can usefully be employed there. Both the secretariat paper and the report of the UN Committee of Experts on this subject3 came to the conclusion that the fundamental solution to the problem of underemployment in most underdeveloped countries lay in rapid economic development resulting in greater production and income for both city people and farm people, and providing opportunity at a later stage of reducing the population pressure on the land.
3 United Nations, Measures for the Development of the Underdeveloped Countries, May 1951.
The Council generally endorsed this conclusion, although there was some divergence of view with regard to the possible effects on agricultural economy. Some members questioned whether increased agricultural production stimulated increased industrial opportunity or whether increased industrial opportunity provided both market and employment for farmers; others thought that initial steps in expanding industrial employment would facilitate agricultural improvement. It was agreed however that the only solution to the problem lay in rapid economic improvement of the countries concerned to bring about an improvement of balance between agriculture and industry, with adequate provision for transportation and communication facilities; such improvement should be approached with due regard to the economic safeguards from both a domestic and an international point of view.
A number of members stressed the need for careful planning to ensure that resources would not be inefficiently used in expanding some lines of activity without the necessary concurrent development in related industries. As an example it was pointed out that the production of crops for other than local consumption would probably also entail the expansion of marketing, transportation, storage, or processing facilities.
More intensive farming may involve the growing of more intensive crops and the use of labor for many related purposes: to improve the productivity of the land, as by drainage or irrigation, to develop more effective methods of cultivation, to improve roads, to build schools, storage plants, and other needed facilities, etc.
In many underdeveloped countries where industrial development is small and available land resources are practically fully occupied, there is a large absolute population growth and great pressure of population on land resources. In such countries the speed of economic development will have to increase to many times its present rate before nonfarm industries can be expanded fast enough to create additional jobs for even the annual additions to the labor force. Under such conditions, many farm people are underemployed, and labor tends to be abundant and cheap, and capital scarce and dear. It was generally agreed by the Council that, where this situation exists, economic development in agriculture should stress efforts to intensify agricultural production as outlined above, so as to increase the number of people at productive work on the land rather than use scarce capital to mechanize agriculture and thus reduce the number of workers employed on a given area of land.
Even at this stage, however, it may pay to introduce inexpensive labor-saving devices such as simple sowing devices, harrows, and harvesting equipment, so as to free more of the farmers, especially the farm women and children, from endless hours of field labor. Some members felt that even under such conditions, there are projects where the use of mechanization would open up new lands or otherwise stimulate needed development. Other members stressed that in most underdeveloped countries agriculture usually produces less value per caput than industry, and that if such underdeveloped countries continue to be only agricultural, they will tend to remain poor.
These controversies require greater consideration because of their bearing upon the choice of projects to be allotted priority in economic development, and the importance of this in the appraisal of Technical Assistance projects.
Some underdeveloped countries, notably in Latin America, have large areas of fertile land only slightly utilized. In such countries the problems of economic development are less difficult, and can follow more along the lines of fuller cultivation of the soil and the development of more diversified and intensive systems of farming, such as has characterized the development of North America. As will be noted later, however, such development is retarded in some cases by the presence of large estates and other traditions of the agricultural structures.
The problem of seasonal employment is also a difficult one, especially in those areas depending largely on single cash crops. Migratory workers often suffer from low standards of living and deplorably bad conditions of existence. The important problem of forced seasonal and other migrations for many underdeveloped countries should be studied jointly by FAO and ILO with a view to finding appropriate solutions.
Economic and agricultural progress improves the position of farmers through the growing output, which gives farmers more to consume themselves, and the rising employment and incomes of the nonagricultural population. This raises the domestic demand for farm products, and increases the supply of industrial products available to farmers.
Marketing and transportation costs, interest rates, and middlemen's charges are so high in many underdeveloped countries that prices may be very low to producers, yet very high to consumers. Adequate attention must be paid to remedying these situations. The development of efficient marketing and transportation facilities concurrently with the growing output should enable nonfarm people to obtain more food at less real cost, and farm people to obtain more industrial products at less real cost, thus contributing directly to the buying and consuming power of both groups.
All this means that for most underdeveloped countries careful advance programming is essential if these difficulties are to be avoided. Economic and agricultural development must be based on carefully considered objectives and steps, to secure a proper balance between the various phases of the development. How far this balance can be attained solely through the initiative of private enterprise, and how far it will require governmental encouragement, guidance, or action, will vary with the conditions of different societies and the stages of development they have already attained. The progress of different industries will vary at different stages in economic development.
The Council took note that these questions of balance, and of the pace at which different sectors of the economy can and should advance, constitute a profound problem for the countries concerned, and decided to draw this to the attention of the Economic and Social Council, with the suggestion that consideration be given by that body to the question of how far joint action by UN and its organs, including some of the Specialized Agencies, might be undertaken to help nations to achieve this balance in economic development which the situation demands. In this connection, the Council also took note of FAO's own efforts to contribute to the appreciation and solution of these problems, on both the national and international plane, by the continuing analyses of the goals and objectives of member nations within the field of agriculture, and by the discussions which member nations themselves undertake in regional conferences.
The Council gave some attention to the interest of farmers in underdeveloped countries in assured export markets for their agricultural products, and to the possible impact of market instability on the rate of agricultural development in such countries. It was recognized that despite the reserve of governments in the past towards the adoption of such farreaching proposals for assured markets as the World Food Board and the International Commodity Clearing House, interest in this subject continues. One of the proposals which have come to the fore recently is European agricultural integration.
The Council approves the action taken by the Director-General in offering the services and co-operation of the Organization in connection with these discussions, and instructs the Director-General to report any material development in this connection to member nations.
Finally, the Council was apprised of the report4 of a UN group of experts on problems of unemployment and economic development in underdeveloped countries, containing a number of specific proposals. A brief summary of the salient features of interest to FAO had been prepared by the secretariat, but in view of the late arrival of the papers in question, the Council was unable to formulate any considered views on the detailed matters which the expert group had presented. The action of UN in arranging for expert examination of these problems was, however, welcomed, and the recommendations were commended to the attention of member governments. It was suggested that governments examine particularly the interest of FAO in the matters involved, and that in the future discussion of the report at ECOSOC the significance of the report in relation to agricultural development be kept fully in mind.
The Council recommends that at the next session of the Conference consideration should be given to the agricultural aspects of full employment, with special reference to conclusions in this connection which might be reached meanwhile by the Economic and Social Council.
How to convey new thoughts to many of the ordinary inhabitants of less-developed countries — how to impress upon them the manner and the significance of substituting new ways of doing things for traditional and customary actions — how to achieve this in circumstances where all too often ill health, poverty, and illiteracy can kill understanding and response, is a basic problem in any attempt to secure the best use of resources. The Council in this connection heard the report of the observer from UNESCO on the pioneer project for fundamental education which that Organization is undertaking, with the co-operation of WHO and FAO, at a newly established center in Mexico, and to which members of the staff of FAO have been attached.
The Council approves the steps taken already by the Director-General to associate FAO directly with this venture, and authorizes him to extend this practical co-operation, where resources permit, to further centers of this kind which might be set up.
In November 1950 the United Nations General Assembly called for a report on the degree to which unsatisfactory forms of agrarian structure and, in particular, systems of land tenure, impede economic development. FAO was invited to co-operate in this inquiry, and the participation of the Organization was approved by the Special Session of the Conference.
The Council heard with approval the Director-General's report on the co-operation of the Organization with UN in the preparation of the Secretary-General's report, in discharge of the above-mentioned General Assembly resolution. This report had just been completed. A preliminary edition, entitled “Land Reform — Defects in Agrarian Structure as Obstacles to Economic Development,” was circulated, and the final edition will be presented to the Thirteenth Session of ECOSOC. The Council was unable in the time at its disposal to examine the report in detail or to receive instructions on the issues involved.
The UN report presents a preliminary study of the salient issues and indicates some of the ways in which the defects impede economic development of food production. It does not make specific recommendations, but suggests ways in which international organizations can help member countries by means of further study and by providing technical advice and assistance. The coming session of ECOSOC may suggest further studies directed to developing more specific recommendations. The following are the outstanding points developed in the report:
The agricultural system of a country determines the way in which farmers occupy farmsteads and acquire and dispose of land; the manner in which rights and obligations are divided when ownership and cultivation are in separate hands; and the mechanism through which agriculture is financed, taxed, and provided with services and facilities. It embraces the whole legal and customary setting in which farming and food production are carried on.
The major impediments to a sound agrarian structure are:
the uneconomic size of holdings in many parts of the world;
the concentration of land ownership in large holdings, with inadequate returns to the tenants or laborers who work the land;
insecurity of occupancy of land holdings, owing to lack of adequate provision for land titles, security for tenants, or water rights;
inadequate provision for agricultural credit, and exorbitant interest rates; and
unsuitable systems of taxation which bear unduly on all farmers or on groups with the lowest incomes, and which discourage improvements in production or commerce, or which are too inflexible under changing economic conditions.
The effectiveness of reforms often depends on concerted action in many interrelated spheres of activity, but certain possible reforms may be introduced without fundamentally changing the economic and social fabric of agriculture. Among these are consolidation of the fragmented holdings of a single farm to ensure greater efficiency in management; registration of titles of land and water; reform of the taxation system to put it on a more equitable and less burdensome basis; provision of long-term credit at reasonable rates; and strengthening of rural educational and advisory services. Such reforms, when intelligently handled, may have a good chance of success.
Where economic and social problems are most pressing, more fundamental and more difficult reforms are usually called for. Most of these reforms involve the transfer of ownership from large landowners to cultivators. During the past few decades many countries have undertaken comprehensive reform of that type.
Since co-operative farming may be an important method following reform of land ownership, the introduction and strengthening of farmers' production and marketing co-operatives is advocated. Co-operatives offer their members economies of large-scale procurement and marketing; they promote specialization and standardization, thereby increasing efficiency; and they can help farmers to offset their weak bargaining position.
In areas of adverse natural conditions it is difficult to establish new forms of agrarian structures involving small independent farms without special assistance from governments. In such areas land reform measures must be part and parcel of broad development schemes in the nature of integrated regional development programs, largescale investment, co-ordinated efforts for land and water use, the control of soil erosion, large-scale irrigation projects, and the expansion of transportation.
By changing the distribution of income and raising farm production, agrarian reforms will allow industrial expansion to generate its own purchasing power and create its own market. In this way, the reform of a defective agrarian structure is, above all, a keystone in the intricate construction for economic and social progress.
Even though the Council did not have full opportunity to study this broad introductory report, the ensuing discussion indicated keen interest. There was general agreement that the complex problems are among the most important of those with which FAO should deal. Since a sound social organization may be as important to increasing production as an improved agricultural technology, it was believed that efforts to bring about both should be equally energetic.
Various opinions were expressed by Council members on the significance of the size of holdings in relation to effective use of resources. Some members thought that adequate technical instruction and professional education toward a more intensive cultivation are more fundamental than a preoccupation with the size of farms. However, it was agreed that in many areas farms are generally smaller or larger than is desirable for optimum economic efficiency, and that in many areas, in fact a large proportion of the farms are so small that the cultivators cannot use their labor effectively or maintain a decent standard of living for their families. Close technical study of these matters is necessary because of the very varied conditions throughout the world which bear upon them; nor must the overall problem of the balance between producer and consumer interests be overlooked.
A matter stressed by all Council members was the very great importance of security of land tenure for tenant farmers and for owneroccupiers alike, and the need that arises from this for adequate systems of law to safeguard the registrations of titles, tenant contracts and liens to land, and other land and water rights. Some members emphasized that the transitional phases in any fundamental reforms of land tenure call for as much adaptation of mind and outlook from those benefiting from such reforms, as does the development of new agricultural techniques.
The Council attached significance to the importance of promoting co-operative institutions among farmers as one of the best means of assuring improved social and economic conditions for production and marketing. On credit (whether based on co-operative institutions or otherwise) the Council expressed concern at the damage to incentive and to productive and marketing efficiency resulting from the existence of inadequate institutions and unduly high rates of interest; it drew the attention of member governments to the importance of improving these conditions.
The problem of the reform of rural structure is not a new one. Many countries have been working on various phases of agrarian reform over many decades, and their efforts are continuing. The record of their successes and failures provides a rich laboratory of practical experience, which FAO might well study in co-operation with the countries involved to determine which lines of action have proved most effective, and under what conditions.
It was generally agreed that FAO should encourage member governments to ask for Technical Assistance to aid in the development of programs of rural reform, and that the experts provided by Technical Assistance should have extensive experience in dealing with the problems in underdeveloped countries.
It was also suggested that when FAO later came to define its program of work in this field, it should
take further steps to make all member nations increasingly conscious of the problem,
encourage the use of expert advice,
assist countries to secure the finances often needed to carry through programs of rural reform.
The Council also took note of other documents bearing on the subject, in particular the relevant sections of the report of the UN expert group on economic development of underdeveloped countries and of the following statement adopted by the UN Economic, Employment, and Development Commission at its session in May 1951:
“The Commission notes that the Council will have under consideration at its Thirteenth Session, the elaboration of a program along the lines of General Assembly Resolution 401 (V) concerning land reform. In this connection the Commission considers that the Council should pay special attention to the need for instituting appropriate measures to improve the security of land tenure; to expand agricultural credit facilities; to improve the conditions upon which cultivators occupy land; to relieve the burden of inequitable taxes and similar charges on the cultivator; to promote co-operative enterprises; and to expand programs of fundamental education in rural areas, adequate research and practical demonstration facilities.”
In view of the fact that none of the documents involved (including the joint UN/FAO report and the report of the UN group of experts) had been available for circulation to the Council prior to its meeting, that the findings of the Economic, Employment, and Development Commission had become available only during the Session, and that the subject was due for full consideration at the forthcoming meeting of ECOSOC, the Council did not attempt at this session to formulate any questions or decisions of policy. Its concern was rather to extract for further consideration and discussion the viewpoints mentioned above.
The Council commends the matter to the attention of the Conference at its Sixth Session, with a view to crystallizing at that time the steps FAO should take, either by further studies or by action of its member nations, to extend action in this important field in line with the conclusions reached by ECOSOC. Meanwhile the secretariat is requested to bring to the attention of ECOSOC the views expressed by the Council.
The 1950 Special Session of the Conference expressed considerable interest in the subject of migration and land settlement, and requested a report by the Director-General on the possibilities of useful action by the Organization in these fields. The effects on optimum agricultural production arising out of conditions whereby there may be too many or too few human beings in relation to land should obviously be taken into account in the Organization's economic analysis of the world food situation, and in the kinds of activities related to agricultural development which it is FAO's purpose to promote. Frequently, though the matter also has features which may be quite independent of migration, land settlement is associated with the problems of achieving a balance between people and land, and has a similar importance for FAO.
The Council noted the activity in the field of migration which is being promoted by ILO, the Specialized Agency having the widest responsibilities in this matter, and by UN itself. Its attention was drawn to the forthcoming Second Session of the Migration Conference and, bearing on this, the agreement between ILO and FAO (CL12/10) on the division of responsibilities between the two Agencies as regards migration and land settlement questions.
The Council welcomes the clear understanding between the two bodies on these matters, and desires that FAO should continue to give all possible technical assistance to governments on the agricultural aspects of migration and land settlement, whether requests for such assistance arise from individual countries or under intergovernmental arrangements. At the same time the Council recognizes that there are considerable financial aspects which are intimately related to these problems.
Whether it is a question of co-operating with other Agencies on migration problems or fundamental education, or of advising individual countries or groups of countries on matters of specific concern such as, perhaps, reforms in land tenure or some other aspect of agrarian structure, the activity called for is Technical Assistance — and quite clearly this is a major day-to-day practical activity of the Organization.
So far as the Organization is concerned, Technical Assistance is the principal means whereby member nations can be helped to advance their economic development and, in the earlier words of this report, make fuller and more intelligent use of their resources of land, labor, and capital. It was with great interest, therefore, that the Council heard the report of the Director-General upon FAO's program for Expanded Technical Assistance (CL12/7) which has extended considerably the scope of the Organization's activities, helped towards a wider fulfilment of the ideals of the Hot Springs Conference, and provided a most timely impetus in further directing the attention of FAO to matters of technique which are the daily concern of farmers, particularly those in the underdeveloped countries of the world.
The Council took note of the extensive activity of the Organization under ETAP which by 10 June of this year had resulted in the conclusion of basic agreements with 33 countries. Under these agreements together with their supplements, 255 experts were to be provided by FAO, of whom 141 were already recruited and 114 were in the field or had completed their assignments. In addition, provision had already been made for 136 scholarships. The Council congratulated the Director-General and the Director of the Organization's Expanded Technical Assistance Program on the progress which these figures demonstrate and on the vigor with which the program has been pursued.
The Council was advised of the financial aspects of these and pending activities under the program. It noted that for the first period of the UN Expanded Technical Assistance Program, FAO could expect in practice an allotment of some $4,875,000, provided all participants in the UN Technical Assistance Fund made available the sums which they have expressed the desire to give. This amount might even, in theory, rise to some $5,800,000 according to final determinations about FAO's share of certain proportions of the total Fund which for the time being are in reserve. Against this the Organization had by 1 June firmly committed itself to expenditures of $4,067,122, thus approaching the more likely ceiling of receipts out of the Fund in the first period. The total of actual and pending requests by underdeveloped countries amounted to $5,758,433.
Arising out of the foregoing, the Council concluded that the successful discharge of even the immediately firm program of projects amounting to just over $4,000,000 depends to the highest degree upon the UN Fund reaching its maximum as soon as possible.
The Council therefore draws the attention of member nations of FAO to the need for any action they can properly take to ensure the payment of outstanding contributions to the Fund.
The Council noted furthermore that the response of member nations to the opportunities presented by ETAP fully demonstrate the vast importance of the scheme in the fields of food and agriculture particularly, and the hopes which have been placed upon it by so many of the less developed countries of the world. It expressed the hope that the significance of these matters would be taken into account in any future consideration of the volume and nature of the assistance which can be given after the first period of the scheme has drawn to a close.
Technical Assistance can be fully effective only when the recipient governments take all necessary and possible steps to facilitate the work of the experts, and put their advice to effective use. Similarly, when students or officials are sent to study out of the country under fellowships or scholarships, timely arrangements should be made to put them to effective employment on their return in activities which will make full use of the special training they have received.
Noting that the question of Expanded Technical Assistance generally had received the close attention of the Fifth Session of the Conference, the Council is of the opinion that the Conference at its next session might wish to consider the conclusions to which it then came in the light of the experience of the intervening two years.
With respect to the presentation of financial information and program to the Conference, the Council stresses the importance of presenting this information in such form that it can be considered with the regular program of work, as recommended by the Special Session of the Conference.
The Council thinks that if Expanded Technical Assistance is to make its full contribution to economic development, several matters require the further attention of the Organization. Thus the educational and information aspects of the program need to be developed as rapidly as possible, both to get the technical information into the hands of producers and help them learn necessary skills, and also to inform the public as to the progress of the program. The analysis too, of FAO's projects in this field should be developed, both within the Organization and in co-operation with the Technical Assistance Board, in order to ensure that the individual projects carried on in each country are such as may be expected to make the maximum contribution to economic development. Finally, it is desirable that the Organization should learn directly from recipient countries themselves, and with the greatest frankness, what real progress is taking place in the development of resources as a result of the assistance which they are receiving.
The Council requested the Director-General to consult with the Executive Secretary of ECE with respect to promotion of appropriate regional studies on rural electrification in Europe which might serve, subject to consultation with Regional Economic Commissions, as a starting point for subsequent studies in other regions, and to use to this effect the available means at his disposal.
It was considered that such studies are a means of increasing agricultural production and productivity of labor in that field, and also of improving the general standards of living in rural areas.
Although the Council's discussion on international investment in fact preceded the consideration of Expanded Technical Assistance, it was quite clear from the statements of Council members that although some Technical Assistance activities could directly increase production with existing means, in most cases substantial amounts of new investment, domestic or international, would be needed before underdeveloped countries could reap the full advantage of Technical Assistance. Ability and technical knowledge are very important, but technical knowledge can be far more effective when it is backed by the tools and equipment to help do the job.
The Council took note of the Report by the Director-General on the Activities of FAO Relating to International Investment (CL12/8) and expressed satisfaction at the close and continuous co-operation which has been developed between the International Bank for Reconstruction and Development and the Organization, both by means of direct collaboration between the two headquarters staffs, and by FAO seconding agricultural members of Bank missions. Some members were concerned about the effectiveness of liaison with the Bank since FAO headquarters had been moved to Rome, but received reassuring advice on this from the Director-General. It was suggested that even where no agricultural loans were involved, experts designated by FAO should participate in Bank missions to give due attention to the effects on agriculture of general development and related development projects.
The Council was pleased to hear of the growing proportion of loans from both the International Bank and the Export and Import Bank going to underdeveloped countries, but felt that despite this increase the total amounts are still below those necessary for effective improvement of the underdeveloped regions of the world. Some concern was expressed over the fact that of 600 million dollars committed by the International Bank in loans for economic development less than 80 million dollars were directly for materials and equipment for agricultural and forestry production. It was recognized that many other lines of development, such as transportation, communication, marketing, and even industry would benefit agriculture directly or indirectly. It was suggested, however, that the FAO staff pay increased attention to the extent of financing provided for agriculture from all sources (including the large amounts of the financing of their overseas territories from metropolitan countries), and continue attempts to determine what are the needs for the international financing of agricultural development, as contrasted with total development.
In addition to the difficulties of securing such funds, underdeveloped countries are encountering increasing difficulties in spending those funds for raw materials, equipment, or machinery needed for their development, owing to the increasing shortages resulting from expanding armament programs. These difficulties will probably increase as the tempo of rearmament rises. The Council considered that the use of materials to provide for economic development of underdeveloped countries is one of the few hopeful means of building up the will to peace and freedom in the underdeveloped regions of the world, and urged its member nations to give full weight to the need of nations for materials for their peaceful development in any schemes of materials allocation or control.
Arising from the general discussion on the Report by the Director-General on the Activities of FAO Relating to International Investment (CL12/8) the Council took note of the Asian Training Center held in Lahore during the latter half of 1950, which provided a wide training to government officials and others in the appraisal and preparation of development projects; and of the proposed inauguration of similar centers for the Mediterranean and Latin-American areas in addition to a further national center in Eastern Pakistan. It endorsed these activities, and expressed pleasure at the thorough co-operation developed by the Director-General with the UN, the International Bank for Reconstruction and Development, and the host countries concerned, in the organization of these international centers.
The Council noted the tendencies revealed in the Director-General's report regarding both the total amount of international investment flowing into the underdeveloped countries and the low proportion for agriculture. The Council was conscious of the need for considerably more concrete evidence about and analysis of these tendencies, if the Organization were to be in a position to demonstrate more clearly the investment needs of agriculture. In this connection there was some disappointment at the response of member nations to the questionnaire on investments initiated at the Fifth Session of the Conference and although some members felt this enquiry should be further explored, the larger number felt that in the circumstances it was not worth pursuing.
The Council further considered and approved a proposal by the Director-General that teams of experts comprising both technical and economic staff should be available at the request of member nations, to help such members directly to organize development projects for agriculture and associated industries; and noted that the International Bank for Reconstruction and Development would be invited to propose experts to assist in the work of such teams.
The purpose of such expert groups would be first to help in drawing up and evaluating agricultural development projects, and secondly, to help in the execution of such projects, if requested, after the necessary funds had been secured.
The Council noted that the Economic, Employment, and Development Commission had made a number of recommendations with respect to the proposals of the UN Committee of Experts affecting the subject of investment. The findings of the Commission are summarized below.
The Commission stated that, without subscribing to the experts' estimate of the amounts of foreign financial assistance needed for the economic development of underdeveloped countries, the majority agreed that the flow would have to be much larger than the current amounts if economic development is to be appreciably accelerated, and stated:
“It is the view of the Commission that attention should be paid to the study of augmenting the flow of capital through international organizations of the United Nations.”
The Commission felt it was not useful to mention the specific figure of 1,000 million dollars a year in loans to underdeveloped countries as a target for the International Bank's annual lending to be reached in five years, but took note of the statement by the Bank that such lending had been increasing steadily in the past few years and “that it intends to continue this policy subject only to its responsibility for the prudent handling of the Bank's resources.” Several members of the Commission dissented from this recommendation.
On the recommendation for an International Development Authority, the Commission was, in general, averse to the proposal for establishing such a body, and added the following comments :
“The Commission notes that Recommendation 14 does not stress as does the text of the experts' report the importance of international financing of low-yielding and slow-yielding projects within comprehensive programs of economic development, the realization of which is essential to the economic and social progress of the underdeveloped countries. Should the Council consider it feasible, the Commission suggests that the possibility of financing such projects be further explored. The view prevailed in the Commission that no new international organization should be set up before a thorough investigation has proved that none of the existing organizations can perform such functions as may need to be performed.”
The Commission was divided on the question of whether grants-in-aid for economic development should be made, a majority opposing such grants as “a normal feature of international economic co-operation” and a minority supporting both grants-in-aid and special loans at low rates and appropriate flexibility as to debt services to finance “low-yielding and slow-yielding economic projects which are essential to the economic and social development of the country and which cannot be financed wholly from other sources.” The Commission also pointed out that adequate arrangements already existed for the proposed technical services, through the UN Expanded Program of Technical Assistance and the economic program activities of the International Bank, and opposed creating new international machinery for these purposes or for reporting on the progress of development programs.
On the recommendation for an international finance corporation, the Commission stated:
“The Commission recommends that the Economic and Social Council invite Governments to give further consideration to this recommendation and in addition invite the International Bank for Reconstruction and Development to consider and to report to the Council whether an International Finance Corporation could make significant additional contributions to economic development, over and above those that can be made by existing organizations.”
Since the Council had not had the full report of the UN Expert Group before it prior to this meeting, it was not prepared at this session to debate the substance of these recommended measures. A number of members, however, expressed their interest in the development of measures to provide investment funds at lower interest rates when needed to finance projects of low returns but of great social or developmental importance.
The Council is of the opinion that member nations should give the closest attention to the discussion of the report, and of the specific recommendations, at the coming session of ECOSOC. Both for this purpose, as well as for effective discussion of the issues dealing with reform of the rural structures, it especially urges member governments to include in their delegations to this ECOSOC session individuals competent to deal with these matters from the point of view of their importance to agriculture, and to consider what FAO's place should be in the future work on the further development of these topics.
In view of the importance of this whole subject for agriculture, the Council proposes that at the Sixth Session of the Conference, the problems of investment in agriculture be given further examination, in the light of ECOSOC's discussions and conclusions.
The Council's discussion of commodity problems was based on a Report of the Committee on Commodity Problems (CL12/15) which outlined that Committee's understanding of its functions and responsibilities in the light of its revised and widened terms of reference, the Committee's views and recommendations on FAO's relations with other intergovernmental commodity bodies, and a brief review of the world agricultural commodity situation. A document which the Director-General had been asked to prepare on FAO's relations with intergovernmental commodity bodies was also used in preparation of the Report (CL 12/24).
The Council welcomed the Report of the Committee on Commodity Problems, reaffirmed the Committee's expanded terms of reference, and generally agreed with the Committee's interpretation of its responsibility to consider commodity problems in their widest aspects while at the same time continuing to study the situation in regard to individual commodities. Note was taken of the great difficulties of finding constructive and generally acceptable solutions of agricultural commodity problems. Yet, it was felt that these very difficulties and the vulnerability and instability of international commodity situations should be regarded as a challenge to deepen the study and to strengthen the effort in this field of work. The Council therefore stressed the importance of continuing the work of the Committee on Commodity Problems and of the contributions which could be made by the secretariat.
In reviewing FAO's relations with other intergovernmental commodity bodies, the Council discussed in some detail the views and recommendations for improved co-ordination put forward by the Committee on Commodity Problems and the substantially similar proposals contained in the Director-General's report.
The Council is of the opinion that while the formalization of arrangements for the participation of FAO observers in the work of steering committees would meet with certain difficulties, it is essential for FAO to co-operate closely with, and to contribute actively to, the work of other intergovernmental commodity bodies and to promote the co-ordination of specialized policies for agricultural products with FAO's own objectives and policies.
The Council endorsed the Committee's recommendation that FAO should continue to maintain the effectiveness of its participation in the work of the Interim Co-ordinating Committee for International Commodity Arrangements, but considered it preferable that the form of such participation should not be tied down by any too definite rules on the lines recommended in the two reports. With reference to co-operation with the International Materials Conference, the Director-General informed the Council of the contents of a letter received by him during the Council session from the Executive Secretary of the International Materials Conference. The Council took note of that communication as a step toward the establishment of working relations between the two agencies.
The Council requests the Director-General to make a continuous study of the influence on the required production of agricultural commodities of the shortage of chemical supplies, equipment, and other similar materials, arising from rearmament programs and other factors. The results of this continuous study will be reported from time to time to the Committee on Commodity Problems. The Committee will submit its recommendations on this subject to the Council.
In regard to comments on The Case for Integration made in the Director-General's report, the Council's discussion endorsed the view that the multiplicity of intergovernmental committees and the partial overlapping and additional expenses involved in such arrangements were matters of real concern, and that the attention of governments should be drawn to the need for watching these developments with great care.
The Council asks the Director-General to continue his efforts for the closest possible cooperation with specialized intergovernmental commodity bodies.
The Council noted that during the last two years, particularly in Southeast Asia, the Near East, parts of Africa and Latin America, conditions in certain areas have existed favoring the building up of locust populations to serious plague proportions. If not checked, the consequences would be a serious loss of food in deficit areas. The problems of locust control are extensive, costly and difficult, and are both technical and operational.
Agreeing that this problem warrants national and international co-operation of both a technical and operational nature, possibly over a long period of time, the Council recommends that the Director-General explore with interested governments and other bodies appropriate measures that might be taken:
to collect information regarding the general locust situation and the locust control efforts of the countries concerned in relation thereto;
to assess the over-all requirement of equipment and supplies, including planes, transport, fuel, spraying equipment, oil solvents, and technical assistance, etc., needed to bring the locust situation under control;
to improve or intensify as necessary the co-ordination of national efforts; and
to assist member governments to obtain aid from such countries as may be in a position to co-operate.
The Council recommends that the Director-General give high priority to this problem within the regular and Technical Assistance Programs of FAO to the greatest extent possible.
It recommends also that the Director-General urgently inform member governments of this problem and report to the next session of the Council and Conference.
The Council had before it a letter dated 14 May 1951, from the Acting Chairman of the National Assembly of the Republic of Korea, referring to a resolution whereby the National Assembly drew attention to the urgent need for fertilizers, particularly nitrogenous fertilizers, in order to speed up the production of food in Korea. It requested FAO “to recommend to those nations contributing to Korean relief and rehabilitation that they do their utmost to send the quantities of fertilizers needed in due time, lest the rice crop should fail.”
The Director-General informed the Council that he had been requested to send a member of his staff to advise on all aspects of the agricultural rehabilitation of Korea, in cooperation with the Agent-General of the United Nations, and would ascertain the actual requirements and the prospective utilization of fertilizers in Korea. This expert had already left and would make his report at the earliest opportunity. It would then be possible to determine what further action could be taken within the machinery set up by the United Nations to ensure a prompt supply of the various fertilizers required.
In March 1951, the Economic and Social Council adopted a resolution requesting the Secretary-General of the United Nations to consult with the Specialized Agencies regarding the implementation of General Assembly Resolution 377 (V), “Uniting for Peace.” The purpose of these consultations would be to determine the specific arrangements that could appropriately be made to provide for the furnishing of information and the lending of assistance in the maintenance or restoration of international peace and security, as might be requested by the Security Council or the General Assembly.
The Secretary-General brought the matter before the Administrative Co-ordination Committee on 15 May 1951. This Committee reported on alternative procedures which might be adopted by each Agency within its constitutional and budgetary limitations to meet urgent requests for assistance. The Committee noted that because of differences in the Agencies' organizational structures and practices the arrangements were likely to vary considerably in the respective Agencies.
After considering carefully the constitutional implications of the suggested procedures, the Council adopted the following resolution:
The Council of FAO—
Recommends that, in conformity with Paragraph 2, Article XII of the Constitution, the matter relating to measures to be taken pursuant to the resolution of 14 March 1951 of the Economic and Social Council for the implementation of Resolution 377 (V) of the General Assembly of the United Nations, be put on the agenda of the Sixth Session of the FAO Conference; and
Requests the Director General
to consult with the Secretary-General of the United Nations with a view to drafting, in the light of the opinions expressed in the Council, texts to be submitted to the Conference of FAO to be used depending upon which of the two procedures is adopted by the Conference, namely, amendment of Agreement between the United Nations and the Food and Agriculture Organization, or adoption of a resolution offering co-operation;
to submit a report to the Council meeting preceding the Sixth Session of the Conference on the results of the discussions with the Secretary-General of the United Nations and on the steps which other Specialized Agencies may have taken in this connection.
The Council considered the report of its Committee on Relations with Other International Organizations together with the comments of the Director-General regarding this report (CL12/14). It noted with interest the work which is being done in order to implement the resolution of the Ninth Session of the Council to compile detailed information on the various intergovernmental and nongovernmental organizations whose sphere of competence is related to the activities of FAO.
The Council understood that the Committee will convene again in Rome to complete the survey in due course, and asked that attention be given to the possibility of including information on the kinds of practical co-operation which exist between these organizations and FAO.
It also understood that while the Committee will continue its activities in Rome, the North American Regional Office will be charged with the responsibility of serving the nongovernmental organizations having their headquarters in the United States of America and Canada.
The Council also approved the Committee's recommendations that the Director-General strengthen procedures for improving consultation with international nongovernmental organizations.
The Council noted the request of its Committee that paragraph (c) of the resolution adopted by the Fifth Session of the Conference on Relations with Nongovernmental Organizations be amended to read as follows:
“International nongovernmental organizations having particular specialized interests in common with FAO shall be accorded specialized consultative status which will afford them an opportunity for consultation with the Organization through appropriate technical divisions. Such specialized consultative status will be granted at the discretion of the Director-General, in consultation, when he considers it necessary, with the Committee on Relations with International Organizations. Such specialized consultative status shall include the privilege of sending observers to appropriate technical meetings with the approval of the Director-General, appearing before the Committee on Relations with International Organizations, receiving appropriate publications and submitting memoranda to the Organization on technical aspects of the FAO program of mutual specialized interest. The Director-General shall keep the Committee informed on applications received and actions taken with regard to specialized consultative status.”5
The Council recommends that this request be placed before the Sixth Session of the Conference.
The Council also considered the report by the Director-General on the developments that had taken place since the Conference in the field of co-operation with other international organizations (CL12/22).
The Council commends the Director-General for submitting this comprehensive review and requests him to bring his report up-to-date in time for submission to the Sixth Session of the Conference.
It is understood that the Draft Agreement between FAO and the Organization of American States will be submitted for Conference approval after incorporation of any amendments suggested by the Council of the Organization of American States.
