Mr. Chairman, Distinguished Delegates, Ladies and Gentlemen,
It would be appropriate to begin by briefly discussing the world economic situation. It is at a critical juncture and the food and agriculture sector is a vital element therein.
Despite having had many opportunities to address the Council, it has not, alas, been my privilege so far to be able to formulate my statement in the context of a satisfactory or optimistic situation in world economic affairs.
In fact, as I look back, it would seem that the situation has never been as bad as it is now, nor ever seemed so daunting.
At the present time, the global system — System World — seems to be in a state of serious malfunction. The global economic system can hardly be said to be the result of a rational, integrated, harmonious design. But taking our analogy from the world of computers, one might say that the basic design of the system is no longer relevant to the users’ needs, and neither the software nor the hardware are adequate.
Let us consider the facts.
In 1981, developing countries as a whole experienced a decline in their per capita GNP or the first time since the 1950s. World trade declined, costing them twice the amount of overseas development aid they received and exacerbating their current account difficulties. Their indebtedness in 1981 stood at 516 billion dollars. Their liability for debt servicing accounted for more than 20 percent of their income from export of goods and services. Their overall economic situation is grave and there is much preoccupation about the continuing financial viability of certain countries and consequently of various financial institutions in the developed countries.
In fact, we can see what amounts to progressive impoverishment of the already poor Third World . Its indebtedness, dependence on food imports and unfavourable terms of trade have been exacerbated over the last few years to the extent that its overall situation is worse than it was a generation ago.
Take, for example, the world price of sugar. This is now 40— 50 percent lower than it was a year ago and well below the cost of production. The export unit value of bananas has declined in real terms up to 20 percent in the last ten years.
All this is not, however, the result of original sin. Nor can it be attributed to the choice of economic systems, which range from laissez—faire to collectivism, nor even to mistaken policies.
There have, of course, been mistaken policies, particularly insufficient attention to food and agricultural development, which could be cited as contributing to the present condition of many Third World countries. But is there anyone who today seriously denies the fact of world economic inter—dependence or of the impact of unfavourable external economic forces on developing countries?
The forces which are impacting so unfavourably on the Third World are impersonal and blind. They strike saints and sinners alike.
Moreover, the scale of the effects of deficiencies of policy and performance in Third World countries are relatively insignificant when compared with the magnitude of the effects of external inflation and recession and of external economic and budgetary measures taken by the mega—economis to stem the tide.
This is not to minimize the problems of the mega—economies. On the contrary, it is the magnitude of their uncorrected inflation, recession and lack of growth which far, far outweighs the puny capacities of Third World countries to cope.
Let us not under—estimate their problems, particularly the bitter economic and social effects of a level of unemployment unknown in the richer countries for many decades. This is bound to affect their attitudes to unselfish policies and demands for generosity in ODA.
It is in the interest of all that the difficulties of the developed world be rapidly overcome. We all hope that the optimists are right in suggesting that the world is in fact now beginning to return to a period of healthy, balanced growth. We all hope that along with this, the truly dramatic stagnation and even fall in the real purchasing power of Third World exports, the savage effects of high interest rates, and the insidious demands for autarchy defended by protectionism, will rapidly melt away.
Surely, the crisis can only be overcome when trade expands, with stabilisation of markets and remunerative prices and the maintenance of an open trading system which would give due satisfaction to the needs of developing countries. Let us hope that the GATT discussions this month will result in some positive decisions, since an escalating thrust and counter—thrust of protectionism can only be harmful for all.
These basic realities should be more generally understood. Here, I would recall Pascal’s description of Man.He wrote: “Description de l’homme: dependence, ddsir de l’inddpendance, besoins”. However, the developing countries cannot and indeed would prefer not to absolve themselves from their paramount duty to take the necessary corrective measures themselves and to be more dependent on their own efforts.
I said at the beginning of this statement that the situation has never seemed so
daunting.
I also indicated, however, that I was drawing a distinction between the world economic
situation and the record in food and agricultural development. Fortunately, on the latter
I can report some encouraging developments.
The excellent harvests of 1981 will be followed by plentiful harvests in 1982. Overall food production in 1981 increased by 2.9 percent and thus was better than in the previous two years. World grain production rose in 1981 by 100 million tons, although a large proportion of this increase of course was in the developed countries. Nevertheless, many developing countries recorded, increased production of staple foods.
This fact should be well noted. It gives the lie to fears that the world cannot feed itself, or to scorns that the developing countries cannot make the necessary efforts to increase their food production. It underlines the wisdom of giving more support to developing countries in their efforts to produce more food.
In this context, there has been much talk in recent times of the importance of incentives for the farmers and of a correct price policy. It has been explicit in some statements that this should be a primary element in new strategies and implicit that it would be a condition for aid.
Perhaps it would be going too far to say that acceptance of a dual price policy — support for farmers’ prices and subsidy for consumers, not unknown in some countries — should be a ‘sine qua non‘ features of increased ODA to agriculture.
The question of price policies is a vital but complex one. I have therefore decided to initiate a major study of the question as a priority for completion in the next biennium.
Meanwhile, however, agricultural development cries out for more aid. I say this advisedly in the context of the fall in real terms of aid to agricultural development since 1979. This fall has occurred notwithstanding all the Summit declarations assigning the highest priority to food and agriculture.
We must all be particularly concerned that the resources of the major financing institutions, both multilateral and bilateral, have been cut through inflation and/or currency developments. The cut has been severe — up to 30 percent in real terms. I refer especially to the situation of IFAD, UNDP and WFP. Both for 1981—82 and for 1983—84, the WFP is still nearly one—fifth short of its respective targets. Contributions to the International Emergency Food Reserve for 1983 have reached only 35 percent of the target level.
Some countries have even ceased to make an annual contribution to the Reserve. Yet all this has occurred whilst food mountains in some developed countries grow together with the increasingly heavy budgetary burdens of subsidies, support and cut price distribution.
Can we really contemplate the return of the age in which food was wasted and even destroyed in certain countries, whilst people died of hunger and malnutrition in others? Is the world incapable of correcting present trends and adopting, as foreseen in Agriculture: Toward 2000, a more rational and equitable distribution of its resources?
I refuse to believe that this is impossible. Now, surely, is the time for world leaders to agree upon a dramatic new initiative, whether it be a minimum global food programme, such as I have previously proposed, or some other plan to resolve this dramatic paradox.
The need was eloquently and dramatically highlighted in the Rome Declaration on Hunger adopted by the World Food Day Colloquium held at FAO Headquarters on 16 October to which I shall refer later.
The need, but also the failure, to adopt specific adequate measures of implementation haunts the pronouncements of all the Summit Conferences held in recent years.
The decline in aid to agriculture in real terms has, as I have indicated, been particularly severe on multilateral institutions.
In fact, the deteriorating situation regarding concessional resources which faces organizations of the UN system is currently under study by the Administrative Committee on Coordination of the United Nations,the second regular session of which I attended earlier this month.
I trust that the ACC report on this subject will be available before our Conference next year. In anticipation, let me mote that the report is likely to draw attention to the following considerations. While world population has grown by 700 million between 1970 and 1980 and may reach a total of 6 billion by the year 2000, current ODA falls far short of the needs as reflected in the International Development Strategy. Total ODA in 1980 represented only 0.3 percent of GNP in respect of DAC countries and 0.13 percent of GNP in respect of Comecon countries.
In favour of multilateralism, I would point out that it is an essential complement to bilateral assistance, but with specially valuable characteristics of its own, including greater responsiveness to global priorities and promotion of inter—country collaboration in vital fields such as animal disease, crop protection, fisheries management and development, and research. I would also mention the special characteristic of political neutrality and objectivity, which is not of course always welcomed, especially by the strongest supporters of increased bilateralism, and the rich diversity of experience and expertise it can collect together for technical assistance.
The real and alleged inefficiencies in multilateral development receive much attention. The system must of course do all it can to improve its erformance and effectiveness. - Yet, as I know not only from my years of personal involvement and observation but also from the unsolicited praise of many unbiased observers, multilateral operations, at least of this Organization, are certainly as efficient as and in some cases more efficient and even more economical than those of many bilateral agencies.
In considering this sensitive subject, it is important to remember that many of the difficulties encountered in operations stem from the basic poverty and under—development that the technical assistance is intended to overcome and these difficulties are experienced by multilateral and bilateral institutions alike.
Certainly, in our on sphere we will continue to make every effort to justify greater support for our role as the promoter, planner, catalyst and agent of development in the field. In this connection, I am happy to recall again the confidence which has been shown in us by our Host Country concerning the development of the Sahelian countries, on which His Excellency the President of Cape Verde spoke so eloquently this morning.
Let me turn now to the unfortunately ever—present problem of how to achieve world food security. We have daily to face the bleak fact that although the concept of world food security can be said to have established itself, after years of striving in numerous fora, only a start has been made in building up the policies and mechanisms necessary for its attainment. Thus, there is as yet no internationally agreed scheme of world food security through which supplies could be guaranteed on a concessional basis in times of need.
Allow me to repeat that now the harvests are so favourable and the effects of recession so deleterious, it is surely time to search for a decisive breakthrough in achieving better world food security.
As recommended by the Sixty—Ninth Conference of the Inter—Parliamentary Union recently held in Rome, what is required in simple terms is “to adopt grain policies and objectives, set up security food stocks and manage them in conformity with the criteria set out in FAO’s Plan of Action on World Food Security”.
I am currently preparing the promised study for consideration by the Committee on World Food Security at its next session in a few months time. It will review developments in World Food Security in the post—war period, revise the concept of World Food Security itself, and discuss possible approaches to a World Food Security System, the institutional implications, and the next steps to be taken. In completing this study, I shall try to combine a suitably normative with a practical approach.
Turning now to various developments during the course of the year, I would refer you first and foremost to the results of the Regional Conferences which have taken place over the last few months.
As always, these meetings are of great importance and interest, since they enable Ministers from within each region to meet to exchange experiences and discuss policies and programmes. In this cycle of Conferences, around 70 Ministers have participated and I have met all of them in separate discussions. I not only find this very refreshing and instructive, but I also benefit from personal contacts and discussions with individual delegations on their national problems.
If the concrete results of the Regional Conference are long—term rather than dramatic or novel, this is a good thing. We are not looking for sensation but for progress in intensifying economic and technical cooperation among the developing countries themselves. In short, the Regional Conferences are a valuable vehicle for South—South cooperation. I am glad therefore to report that in 1982 the Regional Conferences were outstandingly successful in this respect. I thank all the Ministers and Heads of Delegations concerned for their full attendance and support.
There have been many other meetings and important visits, too numerous to identify every one. I would just mention that we have been honoured with 17 visits at Ministerial level and two visits by a President of a Republic, and have held many meetings with delegations from various organizations. One important occasion was the annual meeting with the Nordic countries, when the Nordic delegations were led for the first time at Ministerial level. My thanks are due to the Norwegian Minister of Agriculture for leading what was, I believe, a rewarding policy exercise, which strengthened cooperation and understanding between the Nordic countries and the Organization.
Another important delegation was led by His Royal Highness Prince Talal bin Abdul—Aziz al Saud on behalf of the Gulf Programme for UN Development Organizations. I am glad to say that this Organization has allocated more than 3.75 million dollars through FAO for development projects in several developing countries.
We have, of course, just had a meeting with the CILSS Inter—Ministerial Committee.We were particularly honoured by a visit in October of His Excellency Amin Gemayel, President of the Lebanon . During this visit, keen interest was shown in the possibilities of FAO and WFP jointly assisting in the task of rehabilitating agriculture, which has inevitably been afflicted by much physical and commercial damage. Much assistance has already been provided. Much more is needed. The difficulties are not insuperable, provided that the authority of the Government is not ignored and clear terms of responsibility for action in various fields are observed.
Among the meetings, a great highlight was of course the ceremony of World Food Day on 16 October, which most of you attended. It was preceded by the World Food Day Colloquium to which I have already referred. I shall revert to these at the end of my address today. As a parenthesis, however, I should like to recall that our chief guest on World Food Day, the Honourable Aniintore Fanfani, President of the Italian Senate, referred in his opening address to the Headquarters accommodation.
He recalled that he had been responsible for making ready Building A when FAO first moved to Rome
Naturally, I did not miss the opportunity to mention to him our concern that the Ad Hoc Committee on Accommodation Problems, which the Conference appointed, had not so far been received by any Italian authority and that virtually no progress had been made in our efforts to find an interim solution to our accommodation problems.
I am also deeply concerned at the lack of progress on the question of the Headquarters Agreement and other matters concerning our diplomatic privileges and immunities which are assailed as they have never been before in our history.
These situations are in strange contrast to the outstanding cooperation with FAO, and the generous efforts the Italian Government are making, for development in the Sahel and other countries.
Certain issues will be brought before you later in this Session and I shall keep the Finance Committee and Governing Bodies closely informed of further developments, and shall not hesitate to come to you with the necessary relevant proposals.
There is also much cause for concern about our financial situation, stemming from the extraordinary short—fall in assessed contributions to this Organization. You will be discussing the report of the Finance Committee on this matter. Since their September session, there have been some further payments totalling some 54.5 million dollars. Details will be provided to you in an INF document. The situation however remains extremely serious. The payments outstanding are still nearly 44 percent of the total due at the beginning of the year.
This is not, of course, a demonstration against FAO as such. The situation is similar in most other organizations and even worse in some. Nevertheless, it is extraordinary that this Organization devoted to the cause of conquering hunger should be kept short of its duly legislated funds.
Every possible step has been taken to encourage Member Governments to make up their arrears. I am meanwhile containing the expenditures of the Organization. Fortunately, currency developments have given us an extra cushion in addition to the Special Reserve Account: I trust, therefore, that I shall not be obliged to use the authority to borrow until the New Year, but borrowing will soon become inevitable, that is unless not only the arrears for 1982 and previous years are paid up, but also contributions for 1983 are paid promptly in January next. I strongly appeal to all concerned to meet their obligations in this regard.
The reasons for late payment vary but undoubtedly developing countries are faced with especial difficulties. Bearing particularly these in mind, I am approaching the preparation of the next Programme of Work and Budget in a responsible manner.
As far as possible, new programme priorities will be met by elimination of completed or lower priority activities. The Organization’s efficiency must be further improved, particularly in the support sectors. Nevertheless, some new priorities will require increased resources. It is essential that we step up our priorities, particularly in areas which promote food production and food security, have maximum impact at the field level, and use to the full the potential of developing countries for economic and technical cooperation among themselves. Other priorities, both general and detailed, have emerged from the Council Committees, in particular the Programme Committee, from the Regional Conferences and from other statutory bodies which constitute important sources of advice on programme formulation.
In view of the great uncertainty about the development of costs, it would be most imprudent for me to attempt at this stage to give any forecast of the budget level or of its breakdown in programme and cost increases, which I shall eventually propose for the next biennium. Those of you who live in Rome will be all too well aware of the fact that despite falling inflation rates elsewhere, it has not proved possible so far to adhere even to the ceiling of 16 percent for inflation which was targeted by the Host Government. The current annualized rate is again in the 20 percent range. The prospects for 1983, let alone 1984 and 1985, remain highly problematical.
This will no doubt still be true when I submit the Summary Programme of Work and Budget next Spring. It will therefore have to be understood that the proposed cost increases will at that stage and for some time thereafter be highly tentative. In the circumstances, I could not in all conscience propose to you that as desired by some, cost increases should be absorbed, since this would amount to a very substantial real cut in our programme.
Given the world situation, the particular difficulties of African countries that are well known to you, the protestations of high—level support for the attack on hunger, and the requests of the Member Governments themselves, I find it hard to conceive how anyone could advocate a cut or even a standstill in this Organization’s programme. As I have said, however, I shall take due account of the difficulties and desires of all member countries.
Turning back now to World Food Day, we were privileged not only by the attendance of the Honourable Amintore Fanfani, President of the Italian Senate, and perhaps soon to be Prime Minister, but also by that of Prince Talal, Mr. Raoul Prebisch and many distinguished representatives and visitors. I would again like to express my appreciation also for the support given by the Commune di Roma, under the leadership of the Mayor, Mr. Ugo Vetere, and by all who participated.
On World Food Day, we received messages from no less than 45 Heads of State and Government, who also gave the lead to activities in their own countries. Among them was an inspiring message from His Holiness, Pope John Paul II, and a stirring message from the President of the United States of America , who proclaimed World Food Day as a day of observance throughout the United States
In this context, I must say that it is extremely important that World Food Day should not be regarded as merely another Rome occasion, but a day of universal significance for the cause which FAO serves. The world—wide response so far has been truly remarkable.
Furthermore, the impact of World Food Day does not stop on the night of 16 October. We have growing evidence that the Day generates interest and action which continue thereafter. This, too, is a very important feature of the significance of World Food Day. We intend to do our best to build on this in future years.
In this effort, we shall be inspired by the Rome Declaration on Hunger which was adopted by the World Food Day Colloquium to which I referred earlier.
Although the time available to the participants was extremely short, they had a high—level discussion. Since I am sure you will find their deliberations as illuminating and stimulating as I did, I am arranging wide circulation of a transcript of their proceedings, as well as of the Declaration itself.
The Rome Declaration itself is not yet another strident and unrealistic appeal to prejudice. The distinguished and varied members of the Colloquium took a balanced and realistic attitude, bearing in mind the difficulties facing the world in its search for solutions to its problems.
They were, however, convinced not only about the central importance of food in the agenda of world action, but about the dangers of allowing persistent and evergrowing inequality between and within nations to continue. They were convinced that a major and concerted global effort to accelerate growth in developing countries, especially the less developed among them, was urgently needed and that a much higher priority for food production, as well as sustained efforts towards greater equity, was in the common interest of all people and all nations and the only long—term solution.
In their recommendations, which were framed in the perspective of overall development needs, including agricultural trade and food security, they referred to the responsibilities of developing countries and the highest priorities in various sectors, including increased attention to the poor and to the objectives of WCARRD. They dealt also with the need for a massive increase in assistance to food and agriculture, emphasizing the need for an increasing share of external assistance to be provided through multilateral institutions.
They did not neglect the role of Non—Governmental Organizations, which have consistently drawn attention to the problems of poverty and hunger. I am glad to say that they also recognized the particular responsibilities and lead role of FAO in the fight against hunger.
In inviting me to draw the attention of FAO’s governing bodies and the Heads of other International Organizations and of policy makers at national and international level to their Declaration, they expressed the hope that “policy makers and all people to whom this Declaration is addressed will rise to the challenge and display the necessary vision, courage and determination”.
As they point out, there has been “a dangerous decline in international cooperation for development, precisely at the time when such cooperation is needed”. A retreat from multilateral development cooperation and strong trends towards bilateralism would accentuate the division of the world, “a phenomenon which has led to major world conflicts in the past”.
Their central message is that it is possible to end world hunger and to nourish all the world’s people and its children by the year 2000. Furthermore, only a modest expenditure would be required each year — a tiny fraction of total military expenditure — to achieve this noble objective. They emphasized that “hope can replace despair and positive action replace negative pessimism”.
Finally, Mr. Chairman, I wish to echo their words, that “the ultimate purpose of development is the human being human development is both a means and an end of the struggle to increase food production and eliminate hunger”.
Let us keep these words close to our minds and hearts in dealing with the difficult issues which will, alas, confront us in the days ahead.
