PC 91/7

Programme Committee

Table of Contents

Introduction

Part I: Evolving External Context and Resource Allocation by Strategic Objectives

Part II - Summary of Preferences on Substantive Priorities, as expressed by Members

Part III - Complementary Analysis of Other Programme Areas

Introduction

1. This document follows on discussions on the same subject at the last two sessions of the Committee held in 2003. One of the main conclusions was that the Committee should focus in the first instance on strengthening its own advisory role to the Council in respect of priority setting. The year 2004 was deemed particularly propitious in this regard, as it coincides with the preparation and submission to the Programme and Finance Committees and the Council of the Medium Term Plan 2006-2011.

2. The Committee noted at its session of September 2003, that in order to facilitate its discussion of relative priorities during the May and September sessions (i.e. of the current year 2004), it should be:

provided with specific documentation covering three aspects:

• an analysis of the balance of resource allocations between Strategic Objectives, including changes occurring over time and an analysis of evolving external factors that might necessitate a change in that balance;
• a summary of preferences as to specific priority areas, as expressed by Members in a variety of fora which would be progressively developed; and
• the results of an analysis highlighting programmes on which no priority has been expressed.

3. The present document aims at responding to this request. Hence, it is divided in three parts, addressing the above three aspects. It is worth highlighting that the second part, dealing with a summary of preferences on priorities as expressed by Members, covers the main inter-governmental meetings held during 2003. A supplementary document would be presented to the September session, covering the deliberations of the FAO Regional Conferences held in the first half of 2004.

Part I: Evolving External Context and Resource Allocation by Strategic Objectives

4. During the preparations for the World Food Summit (WFS) and the World Food Summit: five years later (WFS:fyl) and the analytical process leading to FAO’s Strategic Framework 2000-2015, the external context and attendant challenges faced by FAO were extensively canvassed. The outcomes of the WFS in terms of firm policy pronouncements by governments and the endorsement of the Strategic Framework by the Conference in November 1999, gave evidence of broad agreement among the Membership on challenges facing the Organization.

5. Since 1999, a large number of outlook studies issued by FAO or prepared for the Technical Committees of the Council and a host of Expert Bodies, either working under the aegis or outside the ambit of FAO, have sought to address future trends regarding the vast and complex food and agriculture sector covered by the Organization’s mandate.

6. The present document summarizes this body of analytical work, albeit at a high level, into six major challenges. It will be immediately apparent that these broad headings could be broken down into a much larger number of “challenges” at a lower level of detail. However, it is felt that this level of detail is sufficient to allow the reader to move to the next step which is to see what impact there might be, if any, on the Corporate Strategies established in the Strategic Framework and then what effect there has been on priorities within the Corporate Strategies.

MAJOR CHALLENGES

i) The persistence of food insecurity and poverty

7. FAO’s latest estimates of the number of under-nourished people worldwide signal a worrisome setback in the struggle against hunger (cf. figure 1). The number of under-nourished people declined by only 19 million between the WFS baseline period of 1990-92 and the years 1999-2001. This means that the WFS goal of reducing the number of under-nourished people by half by 2015 can now be reached only if future annual reductions can be accelerated to an average of 26 million per year, more than 12 times the yearly pace of 2.1 million achieved to date. It must be noted that Sub-Saharan Africa and South Asia account for a disproportionately large share of the 842 million people worldwide that are still under-nourished.

8. The SOFI 2003 report indicates that the countries that were successful in reducing the number of under-nourished over the last decade, experienced relatively higher economic growth rates, coupled with healthy agricultural growth rates, fewer food emergencies and more equitable income distribution to reduce poverty. How to match this recipe for success in other countries remains a major challenge for the countries themselves and the international community which wishes to assist them.

9. Regrettably, there is no let-up in the incidence of natural or human-induced disasters affecting food security especially in low-income countries, as evidenced by the substantial number of requests for FAO’s crop and food supply assessment missions under the GIEWS. For example, at the last CFS, it was reported that some 38 countries in the world were experiencing serious food emergencies. In at least 17 countries – mostly African – the main cause of food shortages is civil strife and the consequences of war linked with the displacement of people. Internally displaced populations, refugees and returnees have been forced to abandon their homeland, disrupting their way of income earning and food production. In 15 cases, drought – and recurrent drought – reduced crops. Economic constraints and sharp declines in commodity prices (mainly coffee) also resulted in food emergencies in at least 6 countries. In many cases, the situation was exacerbated by the destabilizing impact of the HIV/AIDS pandemic. AIDS and famine are directly linked.

10. As still widespread hunger impairs the economic performance not only of individuals and families but also of whole nations, the need to ensure that development and trade policies lead to sustainable reductions in hunger and poverty must be accompanied by measures and investment actions that increase agricultural production, enhance access to food for the hungry and livelihood systems of the poor, reduce gender inequalities and in general promote growth in the rural areas where three quarters of the world’s poor and hungry still live. An area of increasing demand and critical comparative advantage for the entire UN System is precisely its capacity to intervene “upstream” by providing pertinent policy and strategic advice including institutional strengthening, based on options for decision at national level. FAO’s proven records in investment promotion and formulation also come into play.

Figure 1: Number of undernourished people in developing countries: observed and predicted levels relative to the WFS target

ii) Urbanization - dietary transition and changes in processing and marketing systems

11. Virtually all of the world’s population growth expected between 2000 and 2030 is to be concentrated in urban areas. Provisioning expanding urban markets will clearly be another major challenge for agriculture and food systems in the years to come. Rapidly rising urban food demand induces an increasingly commercial orientation of production systems, while inefficiencies in the marketing and transport infrastructure may provide incentives for the location of production in peri-urban areas. Food safety issues related to street foods, and ensuring adequate hygiene in the transport and small-scale processing of food, loom large in the formulation of urban food security policy. There will be increasing competition for land between agriculture and urban dwellings and infrastructure – particularly serious where no land reserves exist.

12. The pace of dietary change, both in qualitative and quantitative terms, accelerates as incomes grow and populations become increasingly urbanized. In the developing countries which are rapidly urbanizing and where incomes are rising, quantitative changes in dietary intake have been accompanied by qualitative changes in the diet. Even when the changes in energy intake have been small, large increases have been observed in the consumption of animal products, sugars and fats. Monitoring of diets will need to focus not only on under-nourishment, but also on linkages between possibly changing food consumption patterns and non-communicable diseases. Awareness-raising and education will be an essential dimension of policies. Dietary change and concerns may also open up opportunities for diversification in rural enterprises, including high-quality and low-cost horticultural crops.

13. Securing adequate food supplies for urban areas requires improvements in the efficiency of processing, transport and marketing systems, and attention to economies of scale in food marketing and distribution. Countries will need to invest in infrastructure and to improve the overall operation of processing, transport and marketing components of their agri-food systems to ensure the delivery of safe, quality food and agricultural products to consumers and users. Of equal importance is the capacity to innovate and create new value-added products. Failing this, the opportunities to enhance diets through improved food products and to win an enlarged share of national markets (against imports) and of global markets will continue to be missed by many developing countries.

14. Competitive pressures to improve efficiency, product quality and food safety, and achieve economies of scale are leading to substantial organizational and institutional changes throughout the food chain, most vividly illustrated by an impressive increase in the volume of food marketing handled by supermarkets. Such changes include the setting of private grades and standards for food quality and safety, and the adoption of contracts between buyers and sellers at various points along the food marketing chain. Contracting for products of specified quality and traits is likely to proliferate, as a form of interaction between retail food chains and producers, and between producers and processing firms. In the relatively near future, much sooner than had been anticipated even ten years ago, supermarkets, formal wholesale and retail distribution systems, agribusiness firms and agribusiness contracting will progressively dominate the food chains in developing countries, as is now the case in high-income countries.

15. The concentration of food trade in the hands of a few retailers and large market intermediaries threatens the existence of small traders and small business, central ‘spot’ food markets and neighbourhood stores. On the production side, these trends may mean the gradual disappearance of those smallholders who are unable to meet the private standards concerning health and safety set by large retailers and wholesale buyers, as well as neighbourhood stores and spot wholesale markets.

16. Delicate transitions will, therefore, have to be monitored and adequately managed throughout the developing world, in order to avoid too severe dislocations to prevailing traditional systems.

iii) Changing patterns of trade

17. FAO’s projections foresee a continued deepening of the agricultural trade deficit of developing countries. The net imports of the main commodities in which the developing countries as a group are deficient (mainly cereals and livestock products) are likely to continue to rise. At the same time, the net trade surplus in traditional agricultural exports (for example, tropical beverages, bananas, sugar, vegetable oils and oilseeds) is expected to rise less rapidly or to decline. The more positive position of developing countries in respect of trade of fish and seafood, as well as of forest products, will need to be sustained, without endangering the natural resource base and in a context of more stringent market access requirements.

18. Higher developing country imports of cereals and livestock products are due to increased demand combined with the low competitiveness of their domestic agriculture, though the relative weight of these factors varies across countries. Low competitiveness is often the result of weak productivity, inadequate market infrastructure, and lack of research facilities and their outreach to field level. Growing food imports also result from subsidized agriculture in developed countries. Most of the developing countries entered the World Trade Organization without having in place measures of support for their agriculture. This lack of appropriate instruments is to be a difficult issue in the final phase of the Doha round of multilateral trade negotiations.

19. With regard to agricultural exports, markets for traditional exports are generally saturated, but there is potential for significant gains if the processing and marketing of value-added tropical products remains closer to producer countries. However, lack of entrepreneurial and technical capacities on the part of the exporters and the presence of tariff escalation in the importing countries both contribute to the loss of potential export revenue.

20. As agriculture is integrated into the world trading system, there is also an increasing need for regulation. Trade and other movements of animals, plants and human beings allow the rapid transmission of unsafe food, animal and plant diseases across borders, so traceability, control measures and other regulations have become more important to ensure food safety, and the protection of agriculture production systems. At the same time, strict sanitary and phytosanitary standards can serve as barriers limiting market access. Increasingly, developing country producers will need to strive to meet emerging regulatory and private sector standards relating to product quality as well as safety, lest their products become uncompetitive. Product quality and safety issues are becoming important concerns even for domestic markets in many developing countries.

21. With the emergence and strengthening of international standards and regulatory frameworks, the challenge facing Members is to manage and further adjust the new rules-based agricultural system in a way which is conducive to the expansion of international trade and domestic markets, but also explicitly addresses food security and rural development needs, and national financial and administrative capacities.

iv) Access to production inputs and technology

22. The growing scarcity of land and water resources available for agricultural production is a well known, major problem. It is particularly alarming as regards water in the many countries with arid and semi-arid conditions. The problem is often exacerbated by increasing competition for land and water resources from rapidly expanding urban populations and the industrial sector. Scarcity of land and water resources calls for technologies for sustainable intensification, including water management, increases in productivity, stress tolerance, involving resistance to pests, reduced environmental impact, coupled with effective tenure arrangements.

23. Lack of access to other production inputs such as seeds of adapted varieties is a major cause of slow productivity growth, particularly in areas with intensified production systems. National capacities to develop improved varieties has declined or has remained weak in many developing countries, blocking innovations that can in many cases improve the competitiveness of local production systems. Seed delivery systems also need urgent attention. Similarly, most biotechnology developments have targeted commercial farmers who can afford them. Public action is required to create effective demand for research to meet the needs of poor farmers. For this to occur, it is important that the current controversy and uncertainty over the risks and benefits of new technologies be resolved and that acceptable pathways be created through which small farmers can access these technologies. Delivery systems for fertilizer, other chemical inputs and mechanical inputs have in many countries declined during the past decade, as government delivery systems have been phased out with only partial coverage now being provided by the private sector.

24. While less openly recognized, labour scarcities are becoming a common feature in developing country agriculture, even in the so-called labour surplus economies of Asia. In the rapidly developing countries, particularly those of Asia and Latin America, the migration of labour out of the agricultural sector is the primary cause of rising labour scarcities. As economies grow, the returns to intensive production systems that require high levels of family labour are generally lower than those from non-farm activities. With the increased opportunity costs, family labour will have to be used less as a source of power and more as a source of knowledge (technical expertise), management and supervision. In such a context, it will be important to increase returns to labour in agriculture through value-adding post-production activities, efficient use of complementary external inputs and mechanization of field and processing tasks.

25. As recalled above, particularly in the case of Sub-Saharan Africa, AIDS has a devastating effect on the labour force, and beyond the labour aspect on the longer term sustainability of agricultural production. By the year 2020, the epidemic will have claimed one-fifth or more of the agricultural labour force in most southern African countries. Already in several heavily impacted countries, 60-70 percent of farms have suffered labour losses as a result of HIV/AIDS and studies have found that more than half of all households are headed by women, grandparents, and orphaned children. Lacking the labour, resources and know-how to grow staple and commercial crops, many households have shifted to cultivating survival foods. Others have abandoned their fields entirely. The impact may be felt for generations to come.

26. Delivery of research, extension and other support services is a major problem in many countries. In many cases, as central authorities have decentralized responsibilities for extension services, local authorities have not had the required resources to meet their new responsibilities. Privatization policies also have had the unintended consequence in many cases of reducing resources for research and leaving large populations without extension services. Privatization of financial services may also have meant that smallholder farmers, processors and traders face difficulties in gaining access to required, appropriate financial services. Similarly, privatization of marketing services, while generally improving marketing systems efficiency, has also resulted in market access problems for many smallholder farmers. In all cases, public and private sector service institutions need to be strengthened, as well as producer organizations and cooperatives which provide these services to their members.

v) Environmental threats

27. While environmental degradation can often be perceived as a longer-term concern, there are clear indications of serious environmental threats with, in some cases, irreversible consequences for affected regions and communities. Rapidly expanding and intensifying livestock production in tropical and sub-tropical areas, with often very high animal densities, are associated with substantial environmental as well as social and public health risks. Environmental changes accelerate the evolution of agricultural ecosystems; this generates new risks of emergence and re-emergence of animal and human, particularly vector-borne, diseases. Conversely, new technologies can bring their own risks to the environment and hence need to be carefully assessed. The management of manure and effluents from intensive, industrial livestock operations on a watershed basis is required to avoid pollution of surface and ground water. For fisheries, the dramatic depletion of important marine fish stocks and the related need to control illegal, unreported and unregulated fishing and, in the forestry sector, the persistent deforestation in most regions, combined with the impact of forest fires, have been well documented, and are the object of concerted international action to try to remedy them. Cross-sectoral issues such as the impact of agricultural production and forest degradation on climate change and vice versa urgently need attention. Such action will need to continue over extended periods.

28. Improving environmental management does involve difficult economic tradeoffs, and must be based on good information on the full costs and benefits associated with eventual corrective changes. There is still a massive capacity-building requirement in the governments of developing countries in order for them to be able to promote environmental management in a manner consistent with achieving economic growth and poverty alleviation.

29. Various types of interventions must come into play: e.g. the maintenance of watershed functions; more responsible fisheries regimes; health services such as maintaining a clean water supply; regulation of “land-detached” livestock industry; options for possible agricultural development while conserving biodiversity; the promotion of fully integrated systems in favourable ecologies; and mitigating measures against climate change through carbon sequestration. The potential benefits from concerted action across regions towards the maintenance of vital ecosystem functions and balances, have led to considerable debates over improved management regimes, and more recently the recognition of the need for “payment” mechanisms to reconcile the demand from higher income countries for environmental services with supply by lower income countries.

30. In the last 20 years, many institutions and legal instruments governing the environment have been established at the international, national and local levels of administration. These are intended to reduce or reverse various aspects of environmental degradation, including the loss of biodiversity, land degradation, greenhouse gas emissions, and industrial pollution. However, environmental “governance” systems have, all too frequently, been set up in parallel to governance of other sectors of the economy, resulting in contradictory and often ineffective policies. Countries need massive assistance to meet their treaty obligations under international environmental agreements and improve their own environmental regulatory regimes, in the context of meeting their objectives for agricultural development and food security.

vi) Gaps in knowledge and Information

31. Meeting each of the preceeding challenges requires that important gaps in knowledge and information will be tackled which will in itself be a major challenge for the future. FAO plays both a catalyctic role in promoting the generation of knowledge and information and a crucial role in collecting, analyzing and disseminating knowledge and information. A particularly important component of this consists of statistical data. Current efforts for achieving policy objectives in food and agriculture, at national and international levels, are hampered by serious gaps and inaccuracies in the statistical data bases. The ongoing modernization of FAOSTAT is aimed precisely at addressing these significant weaknesses. Another important cross-cutting area of work of FAO is the regular issuance of “State of the World” reports dealing with food and agriculture, forestry, fisheries, and food insecurity.

32. An important aspect of the challenge to close these gaps is the limited access to knowledge and information which is a major constraint to economic and social development. Digitized knowledge and information have irrevocably altered the global economy due to the speed and volume with which they are transmitted and used across the world. Thus in the 21^st century, Information and Communication Technologies (ICTs) are essential instruments of development and many developing countries face opportunity costs if they further delay improving access to and use of information technology. Already more than one billion people who live in rural areas throughout the world are excluded from participating in most of the economic and social benefits generated by access to digital knowledge and information. Many LIFDCs and some other developing countries are unable to take advantage of opportunities to improve productivity, markets, food quality and the overall economic performance of their agricultural sector because of lack of access to relevant and useful information and knowledge. Addressing the digital divide is important in the context of efforts to combat hunger and poverty particularly among the rural poor. It is also critical for countries wishing to participate in the global economy. Thus, is is FAO’s challenge to facilitate countries’efforts to “bridge the digital divide”.

IMPLICATIONS FOR FAO’S CORPORATE STRATEGIES TO ADDRESS MEMBERS’ NEEDS

33. The Strategic Framework 2000-2015 was formally approved by the Conference in November 1999. The five Corporate Strategies to Address Members’ Needs contained in the Strategic Framework are recalled below:

1. Contributing to the eradication of food insecurity and rural poverty
2. Promoting, developing and reinforcing policy and regulatory frameworks for food, agriculture, fisheries and forestry
3. Creating sustainable increases in the supply and availability of food and other products from the crop, livestock, fisheries and forestry sectors
4. Supporting the conservation, improvement and sustainable use of natural resources for food and agriculture
5. Improving decision-making through the provision of information and assessments and fostering of knowledge management for food and agriculture

34. If one examines the six major challenges described above and compares them to the Strategies and Objectives in the Strategic Framework, it is noteworthy that each of the former is in some way already addressed by the latter; that is, the Strategic Framework continues to be relevant and valid.

35. The question which arises for the Programme Committee is whether the major challenges outlined above are such that there should be a shift in priorities to the extent that the balance of resources between Strategic Objectives should be considered.

36. Table 1 below attempts to “map” from the major challenges to the five Corporate Strategies by showing the new priorities that have already evolved or those on which the emphasis can be said to be increased significantly. The sections below, for each Corporate Strategy, provide additional information on these priorities concentrating on those that are new since the Strategic Framework was approved or have come into much greater prominence.

37. In both cases (i.e. the Table and the text below), it is not possible to be fully comprehensive although the more significant areas of priority activity are mentioned. However, comprehensiveness is not essential to the purpose of this exercise which, as indicated above, is to assess the suitability of the balance of resource allocations by Strategic Objective.

Table 1. A schematic overview of important areas of FAO's work set against the six identified "challenges" and the FAO Corporate Strategies

A - Contributing to the eradication of food insecurity and rural poverty

Initiatives to Fight Hunger and Poverty

38. Following the World Food Summit and the World Food Summit:five years later, the Organization has sought to sharpen the focus and strengthen the coherence of its activities aimed at supporting the efforts of member countries to achieve the Summit goal (see Conference document C 2003/16).

39. In the field of advocacy this has led to the promotion, jointly with IFAD, IPGRI and WFP as well as international NGOs, of the International Alliance Against Hunger (IAAH), the main aim of which is to strengthen national and global commitment and action to end hunger. Expressions of interest have been received from entities in over 70 countries, both developed and developing, in establishing National Alliances Against Hunger, which would be linked to the IAAH.

40. The Anti-Hunger Programme (AHP) was presented at WFS:fyl by FAO to provide an indication for members of the major actions which would have to be taken on a global scale and their approximate costs if the WFS goal was to be attained. The main elements of the AHP are reflected at continental level in programmes such as the NEPAD Comprehensive African Agricultural Development Programme (CAADP), prepared with substantial inputs from the Organization, as well as at the regional or sub-regional levels in Regional Food Security Programmes.

41. At national level, FAO’s own direct actions in support of food security are also consistent with the AHP framework. For the long term, much of the Organization’s policy assistance work is focused on helping member countries to update National Strategies for Food Security and Agricultural Development, linking these into their Poverty Reduction Strategy Papers (PRSPs). These strategies take the WFS goal and the Millennium Development Goals as their points of reference and can materialize through five-year medium-term investment programmes and the preparation of “bankable” project profiles as currently being done for Africa.

42. Over 100 countries are now participating in the Special Programme for Food Security (SPFS), and, of these, at least 30 are in the process of moving from pilot-scale actions to National Food Security Programmes. Through the SPFS, FAO plays a catalytic role in assisting the concerned countries to design and implement such nation-wide programmes. Success, however, will depend on strong national ownership and the effective engagement of partners, including partnerships between developing countries as exemplified by the 28 South-South Cooperation agreements now in place.

43. Implicit in these efforts is the work directed at identifying income opportunities and building local institutions in order to enhance and improve the sustainability of rural and urban livelihoods, an area of work that attracts substantial interdisciplinary collaboration.

B - Promoting, developing and reinforcing policy and regulatory frameworks for food, agriculture, fisheries and forestry

Voluntary Guidelines on the Right to Food

44. Responding to a decision by the WFS:fyl, the FAO Council established an inter- governmental working group charged to develop, together with stakeholders and in cooperation with relevant treaty bodies, a set of voluntary guidelines to support the progressive realization of the right to food, in the context of national food security. It is serviced by an FAO-based secretariat and related work has benefited so far from extra-budgetary support.

Capacity-building to enable better integration of countries in the multi-lateral trading system

45. As agriculture is increasingly integrated into the world trading system, FAO is facing strong demands for assistance and capacity-building in areas such as regulation of food safety, plant and animal health and more generally, in making food and agricultural policies compatible with the multilateral trade rules established by the relevant WTO Agreements. There is also increasing demand for training to enable developing countries to collect quality information and to analyze this information in the formulation of national policy and strategies.

C - Creating sustainable increases in the supply and availability of food and other products from the crop, livestock, fisheries and forestry sectors

Biotechnology applications

46. FAO faces a particularly complex set of issues in assisting with spreading the benefits from biotechnologies on a wider scale. It is highly desirable that these technologies should meet the needs of small farmers, herders and fishers, while research and technology development are more and more in the private domain. New biotechnologies (for example, Genetically Modified Organisms – GMOs) could potentially contribute to fulfilling some production needs of resource-poor farmers, and also to improving the nutritional content of crops and livestock products.

Efficient use of water

47. FAO’s strategy is to “re-invent“ water management in the agriculture sector, based on the modernization of irrigation infrastructure and institutions, the full participation of water users in the distribution of costs and benefits, the promotion of affordable technologies and the revival of flagging investment in key areas of the agricultural production chain. There is broad scope for policy intervention to help to “re-invent“ agricultural water management, including cost-effective involvement of water user groups. In fact, individual farmers and households need to be assured “stable engagement“ with land and water resources, through land tenure systems and water use rights that are flexible enough to promote comparative advantage in food staples and cash crops. These rights must be matched by access to rural credit and finance, and the dissemination of technology and good practices in water use. There also needs to be a re-adjustment in management away from rigid formal irrigation systems and towards more adaptable technologies, such as small-scale water harvesting, that are responsive to demand rather than a function of supply.

Good agricultural practices

48. Due to consumer requirements for high quality and safe food, marketing system changes and competition over natural resources, FAO faces a challenge in promoting and supporting the rapid uptake of good agricultural practices, so that increasing number of producers can generate products that meet market requirements while managing their resources in a sound and sustainable manner. The challenge of identifying good agricultural practices and supporting their widespread update is complex, involving multi-stakeholder actions and high levels of inter-disciplinarity.

D - Supporting the conservation, improvement and sustainable use of natural resources for food and agriculture

Conservation and sustainable utilization of biodiversity

49. Genetic resources for food and agriculture have increasing value as inputs to the development of new varieties and breeds, due to increased privatization and commercialization of breeding. Ensuring that agricultural producers in general, and poor producers in particular, have access to these new products, and that they benefit from the use of genetic resources derived from their farm-based conservation is another key issue which lies at the core of FAO’s mandate. One important dimension of agricultural biodiversity conservation is resolving the tradeoffs producers face between maintaining diverse systems versus the adoption of more homogenous but productive breeds and varieties.

Responsible fisheries management

50. The targets recently set by the World Summit on Sustainable Development (WSSD) 2002 imply renewed strong action and capacity building towards global reporting and assessment of the environment, the implementation of the International Plans of Actions on fishing capacity and illegal, unreported and unregulated (IUU) fishing, the application of the ecosystem approach and the maintenance and restoration of fish stocks.

Climate change mitigation and adaptation

51. The agricultural sector both contributes to and is impacted by climate change. It is responsible for greenhouse gas emissions from several sources, including land use conversion, livestock management and irrigated rice. On the other hand, it can counteract greenhouse gas emissions through carbon sequestration, conservation or substitution measures, including forest conservation and forest fire control. Identifying means by which the sector can reduce and mitigate emissions is essential. Also, it is clear that climate change impacts are likely to be harshest in developing countries, which have the least capacity to respond. Developing strategies for adaptation and the means to implement them is thus another critical issue for policy-making.

E - Improving decision-making through the provision of information and assessments and fostering of knowledge management for food and agriculture

Anti-hunger Programme – see A.

International Alliance Against Hunger (IAAH) – see A.

FIVIMS: Food Insecurity and Vulnerability Information and Mapping System and the Millennium Development Goals

52. FAO has been mandated since its inception to monitor the global situation with regard to hunger and malnutrition in the world. However, the WFS Plan of Action calls for strengthening systems for monitoring food insecurity and vulnerability at sub-national, national, regional and global levels. As a result, the Food Insecurity and Vulnerability Information Mapping System (FIVIMS) initiative was launched and an Inter-agency Working Group is steering its activities. Over the years, FIVIMS has acquired many dimensions, and is now involved in contributing to the monitoring of the Millennium Development Goals, as well as with conducting multi-disciplinary work at community level to better understand the causes of food insecurity and vulnerability. Evolving food systems, and the changing nature of nutrition problems, constantly add new challenges for the measurement of food insecurity to which FIVIMS must respond. This monitoring function is also critical to the development of appropriate responses to crisis situations.

Towards healthier diets: awareness raising and education

53. In the context of sharply rising interest on diet issues in public opinion world-wide (and no longer the preserve of developed countries), it would be appropriate to consider what sort of advocacy role might be played by international agencies such as FAO and WHO. Changes in food supply and processing systems will have to respond more directly to consumer expectations and become more environmentally, economically and nutritionally viable. There are numerous opportunities for nutrition education and health promotion in these areas, addressing for instance micronutrient malnutrition and the linkages between food consumption patterns and non-communicable chronic diseases.

Addressing the knowledge and information gap

54. In implementing its mandate to collect, analyze, interpret and disseminate information FAO applies appropriate technologies to address the knowledge and information needs to specific target groups in member countries. It assists them to develop their own human and institutional capacities to use information and communication technologies in the pursuit of national and regional food security goals. In this regard, FAO has various activities under way aiming at closing the knowledge and informatioin gap in all its Corporate Strategies. It is also a key player in the implementation of the World Summit of Information Society (WSIS) Plan of Action which calls for the “systematic dissemination of information using ICTs on agriculture, animal husbandry, fisheries, forestry and food, in order to provide ready acces to comprehensive, up-to-date and detailed knowledge and information, particularly in rural areas.”

RESOURCE TRENDS BY CORPORATE STRATEGIES AND UNDERLYING STRATEGIC OBJECTIVES

55. As far as FAO’s substantive work is concerned, the MTP formulation process (and of course also the PWB) is now firmly grounded in the Strategic Framework 2000-2015, including the linkage of entities to the Strategic Objective or Objectives of main relevance.

56. Both the MTP 2002-07 and the MTP 2004-09 documents include tabular information on the contributions of the various substantive Major Programmes and Programmes (i.e. under Chapter 2 of the PWB and Major Programme 3.1 Policy Assistance) to Strategic Objectives, thus initiating a historical series.

57. In effect, a shift in the allocations of resources among Strategic Objectives already occurred between the MTP 2002-07 and MTP 2004-09, as reported in the latter document. The most prominent feature was the increased share of resources contributing to corporate strategy D - Supporting the conservation, improvement and sustainable use of natural resources for food and agriculture. It must, however, be recognized that FAO's units encounter some difficulty in allocating activities and resources between strategies D and C - Creating sustainable increases in the supply and availability of food and other products from the crop, livestock, fisheries and forestry sectors, where the efforts to ensure sustainability in increased production might be viewed also as efforts to support the sustainable use of natural resources. Hence, the increased allocation to Strategy D reflects less inflexible allocation rules and a better delineation between C and D.

58. A more recent breakdown of resources by Strategic Objectives is available in relation to the PWB 2004-05, and has been added to the table extracted from the MTP 2004-09 documents, as follows:

Table 2. Distribution of Resources of Technical Programmes by Strategic Objectives (Percentages)

59. Not surprisingly, the distribution for the current 2004-05 biennium is broadly consistent with the estimated percentages for the entire 6-year period of the Plan. The slight drop observed against Corporate Strategy D could become worrisome if continued over the next biennia. E1 remains preponderant by attracting by far the largest share.

SUGGESTED ACTION BY THE COMMITTEE

60. The Committee may wish to provide comments on the pertinence of the above analysis of major challenges, the demands they will have and continue to place on FAO, and how they may influence the implementation of FAO’s Corporate Strategies. It may also wish to advise on whether the major challenges identified imply a need to rebalance resource allocations by Strategic Objectives. In broad terms, the Secretariat believes that the historical pattern of allocations is reasonable and that the changes which may arise from the six challenges suggest new or re-emphasized priorities for all five Corporate Strategies but do not, at this stage, warrant an effort to redistribute resources.

61. The Committee may also wish to confirm the relevance of the Strategic Framework in relation to priority setting as the only unanimously adopted document describing how the Organization should assist its Members attain their goals.

Part II - Summary of Preferences on Substantive Priorities, as expressed by Members

62. A prototype of a possible summary in tabular form was presented to the Committee at its last session, distinguishing between various “categories” of priorities. However, the latter have been somewhat modified and simplified, to take account of comments made by Members of the Programme Committee on the five categories used in the prototype.

63. The summary is now based on the following straightforward categories:

1. Highest Priorities, supported by a broad spectrum of Members;
2. High Priority areas, repeatedly mentioned in interventions of Members or mentioned in reports, although not necessarily commanding broad support;
3. Other Priority areas, generally based on regional needs or on very strong interest of specific countries.

64. Accordingly, the following table has been prepared. As mentioned in the Introduction, its contents are derived from records of sessions of the Council and Conference held in 2003, including Verbatim Records, as well as the reports of the main Council Technical Committees (COAG, COFI, COFO or CFS) held in the same year. Use was made in particular of the sections addressing PWB proposals, in order to avoid undesirable bias in favour of specific areas which happened to be on the agenda of these sessions. While some of these priority areas may cut across various Major Programmes in the PWB, an attempt was made to cross-reference them by Major Programme of major relevance.

65. The summary seeks to cover only those referring to specific sub-sectors and/or disciplines pertinent to FAO’s mandate and/or relating to on-going, easily recognizable programmes and activities. Thus, it avoids any attempt to reflect the many references to generic aspects of national policies which delegations consider “important” and generally stress in interventions: e.g. poverty alleviation, overall rural development, etc.

66. When submitting the prototype last year, it was suggested that the Secretariat would also provide necessary interpretative statements on its understanding of the intent of individual recommendations or requests, particularly when these were of a somewhat generic nature. Hence, the column entitled “Assumed position of Members” in the table, which has no other “official value” than this hopefully useful interpretative attempt by the Secretariat.

67. It is emphasized that this list has been used in connection with the revision exercise to the Programme of Work and Budget 2004-05, the results of which are also before the Committee in document PC 91/3¹. The latter document mentions that preferences, as expressed by Members, was one of the critical inputs to the exercise, in complementarity with the application of criteria analysis. It is also pertinent to stress, that either at the stage of initial design of programmes and programme entities, or whenever prioritization is required, e.g. during the formulation of MTP or PWB proposals, another source of guidance to technical staff is constituted by the conclusions of expert meetings and peer groups, while they should also take account of the lessons and recommendations from evaluations.

Table 3. Summary of preferences, as expressed by Members (and “protected” in the adjustments to PWB 2004-05)

SUGGESTED ACTION BY THE COMMITTEE

68. As recalled in paragraph 66, the above list does not show separately support for generic aspects of FAO’s work. For example, “capacity-building” is very widely stressed, either in general terms or in connection with specific sectors or disciplines, such as biodiversity, biosecurity (food safety, animal and plant health, biosafety), policy formulation, etc. Trade-related capacity-building is mentioned in Table 3 in the context of the MTNs. As the effective allocation of resources is necessarily made through the programme structure, it implies that Members need to identify the programme entities to which they wish to see additional resources allocated for capacity building.

69. It is stressed again that there are potentially serious problems of interpretation of reports which mention priorities in general terms. The example of WAICENT, which is usually accorded high priority, is typical. The WAICENT entity itself is 222P6 Corporate Information Management and Dissemination Systems with a budget of US$ 5.4 million in 2004-05. However, WAICENT relies for instance on 222P1 Agricultural Resources and Income Statistics (budget US$ 3.1 million), 222P2 Agricultural Production, Trade Statistics and Food Balance Sheets (budget US$ 5.2 million), 222P7 Standards, Norms and Procedures for Improved Access to Agricultural Information (budget US$ 1.3 million) and 222P8 Facilitation of WAICENT Outreach (budget US$ 2.5 million) which were not accorded high priority. Water is another area consistently recognized as high priority and which is addressed by several entities. In the revised PWB 2004-05, entities 211A1 Agricultural Water Use Efficiency and Conservation and 211A5 Land and Water Quality Improvement are accorded the high priority linked to the water sector. Entities addressing water issues in the fisheries and forestry contexts, such as 232A1 Promotion of Responsible Inland Fisheries and Aquaculture, 232P1 Global Monitoring and Strategic Analysis of Inland Fisheries and Aquaculture, and 241A7 Forests and Water are not specifically mentioned in interventions (as it happens, they are accorded high priority because they fall within the high priority sectors of Fishery and Forestry).

70. The Committee is therefore invited to recommend that reports, which include the assignment of priority to a given entity or group of entities, also include references to the entity numbers covered by the relevant statement in the report or otherwise clarify the intent.

71. In addition, the Committee’s views are sought on the time dimension. For example, the GIEWS (entity 223P6), which was in the past frequently referenced of being of high priority, was not mentioned once in 2003. And hence it was classified in the “medium priority” category for the purpose of the adjustments to the approved PWB. The question is how long does a report reference, recommending high priority for an entity, remain valid. In the absence of any firm recommendation in this regard, the Secretariat has assumed that in preparing the MTP and PWB, it should give prime importance to the views of the immediately preceeding meeting of each of the following (dates refer to current cycle):

• Technical Committees of the Council (i.e. January-March 2003)
• Council (June and November 2003)
• Conference (November/December 2003)
• Regional Conferences (first half of 2004)

72. The only exceptions to this general rule have been where a specific decision of the Conference remains valid. The Committee may wish to recommend a “default” period of validity for references in the reports of the above bodies for this type of exercise.

73. In any event, the Committee may wish to endorse the contents of the preceding compendium of priorities (or amend it, if it so wishes) as a fair interpretation of the views of Members.

Part III - Complementary Analysis of Other Programme Areas

74. During earlier discussions, and as alluded to in the preceding Part II, both the Secretariat and Members of the Committee have underlined the limitations inherent in such compendia of expressed views, as may be derived from the reports of Technical Committees or Regional Conferences and from the Verbatim Records available for the Sessions of the Council and Conference. In fact, document PC 90/4 submitted last year underlined that even the sum of individual interventions at sessions and the agreed conclusions in reports of the meetings, may not constitute a reliable proxy of the preferences of the whole Membership as to priorities, especially as:

• interventions and reports may be biased in favour of specific areas, because of items put on the agenda of any given session;
• reports unavoidably tend to give prominence to positions expressed in the most vocal interventions, at the expense of “silent majorities”;
• both interventions and reports may only reflect highly topical concerns of Members, who tend to highlight these concerns because of the opportunity to share them with other Members in FAO fora, therefore understating the continued high support the same Members may have to other priorities, the importance of which may be “taken for granted”.

75. Another general problem is that many interventions, particularly during the general debate at the Conference, and at times even in the context of the Technical Committees, tend to focus on describing national policies or situations, and would very rarely underline areas within FAO’s programmes to which the national authorities in the concerned countries attach particular importance. In fact, the same national authorities in the context of country-level exercises and their dialogue with external development partners, make pressing requests for technical assistance in a number of “priority” areas, particularly for policy advice, providing another critical “barometer” of preferences from Members.

76. This third part of the document reflects the results of a comparison between the entire FAO’s programme (for substantive work, i.e. Chapter 2 and Major Programme 3.1 of the established PWB programme structure), as presented in the most recent MTP 2004-09, and the priority areas shown in the preceding compendium.

77. In this light, the substantive programme entities which could not be directly related to the priority areas in the compendium, are listed in Table 4 below. Those were generally assigned a “medium priority” ranking in the determination of the initial resource reduction targets mentioned in document PC 91/3, although they did not necessarily suffer from substantial cuts. The list covers Technical Projects (TPs) and Continuing Programme Activities (CPs) but not Technical Services Agreements (TS) entities which cannot be addressed in the same way. It also excludes the programme management entities for the same reason.

78. Table 4 contains supplementary information to assist to Committee in its deliberations:

End Date: the date the technical project is expected to complete its activities as originally designed, or “continuing” in the case of Continuing Programme Activities as determined in the MTP 2004-09;

Revised PWB 2004-05: the amount in US thousands allocated in the proposed revised PWB 2004-05, as submitted to the Programme and Finance Committees (PC 91/3);

Criteria Analysis Results: marked as “lower” or “higher”, i.e. where the criteria analysis score for this entity falls below or above the median of scores for all entities of the pertinent major programme (e.g. 2.1, 2.2, etc.).

79. The attention of Members is also drawn to the Medium Term Plan 2004-09⁴ which presents the rationale, objective, indicators and major outputs for each of the entities listed below and hence their overall substantive thrust, on which a judgement concerning relative priorities should be based.

Table 4. Complementary analysis – TPs and CPs ranked as “Medium Priority” in PC 91/3

SUGGESTED ACTION BY THE COMMITTEE

80. The Committee may wish to discuss the relative priority status of the substantive entities listed above. It would greatly assist the Secretariat if the Committee could indicate for each entity, for the purposes of the MTP preparations, into which of the three categories it falls, i.e.:

• Highest Priority, supported by a broad spectrum of Members;
• High Priority Areas, although not necessarily commanding broad support;
• Other Priority Areas, particularly those based on regional needs or embodying the very strong interest of specific countries.

81. Alternatively, the Committee may wish to discuss other ways in which the views of the Membership can be identified and taken into account.

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¹ It may be noted that the absolute protection was accorded in the adjusted PWB to TCP, the Programme for the Improvement of Language Coverage and to entities where the budget is effectively committed in an agreement with a third party (e.g. the contract with the External Auditor, or jointly funded activities with external partners, such as entity 251P4 Secretariat of the CGIAR Science Council).

² Unfortunately, in the PWB 2004-05 reduction exercise, it has not been possible to give the same degree of protection to FAOSTAT and related work (i.e. statistical data collection, appraisal, normalization and storage) as to WAICENT (i.e. 222P6).

³ These priority areas were not treated as high priority in the adjustements to the approved PWB 2004-05 but were instead included under “medium priority”.

⁴ CL 123/17