High-Level Round Table on Agricultural Trade
and Food Security
Statement by the Director-General
FAO Headquarters, Rome, 13 April 2005
Ladies and Gentlemen,
It is a great pleasure to welcome you to this High-Level Round Table
on Agricultural Trade Reform and Food Security organized
to coincide with the Sixty-fifth Session of the Committee on Commodity
Problems and the Nineteenth Session of the Committee on Agriculture.
The 1990s were noted for a general trend towards trade liberalization
and economic reform in almost all parts of the world.
However, the impact of these measures on food insecurity and poverty
continues to be widely debated, within both the context of ongoing
WTO negotiations under the Doha Development Agenda and as part of
the challenges that are inherent in meeting the Millennium Development
Such is the background to this Round Table which will be addressing
three major questions.
Part I: The agenda of the High-Level Round Table
The three questions asked
FAO sees the following questions as being particularly relevant
as they cover the most controversial aspects of ongoing policy debate.
First, does the liberalization of agricultural trade threaten food
security and the alleviation of rural poverty?
This is a recurring question, even in countries committed to and
working towards trade liberalization, notably through the WTO process.
Although there seems to be broad consensus that trade liberalization
fosters efficiency and economic growth, the immediate results for
the poor and food insecure seem to me to be mixed. Experience shows
that gains and losses and the distribution of winners and losers
among individuals and countries are determined by context. In practice,
a great deal seems to depend on the existence of complementary factors,
including elasticity of supply, distribution of household income,
institutions and markets. This suggests that appropriate liberalization
policies depend on specific contexts and situations. Hence the need
to discuss and share our experiences so that we can identify the
successes and the failures and find the reasons for the differences
Second, under which circumstances can protection of the agricultural
sector be justified to ensure food security when, as we know, protectionism
runs counter to liberalization? We need to know whether there are
circumstances that can justify the protection of agricultural sectors,
subsectors or commodities in order to enhance food security. For
example, can a country's level of food self-sufficiency reached
and maintained through trade protection serve as justification?
Or, can a country invoke poverty or low agricultural productivity
to justify protection, or at least temporary protection? And to
what extent can we ask a country not to protect its agricultural
sector when it imports products from countries that subsidize their
We could also ask whether protection has different roles to play
at different levels of economic development, or even whether subsidies
to agriculture can be justified by its different roles beyond the
supply of food and raw materials.
The third question relates to the most appropriate national policies
for ensuring food security during the process of transition towards
freer agricultural trade. Even if we agree that the goal is freer
agricultural trade, some type of intervention on domestic markets
or at borders might be necessary during the transition phase. The
question is to determine the policies and the measures. Here again,
experience and studies show that these will largely depend on the
conditions of each individual country. For example, are there institutions
and markets that can support the move towards a market economy but
that can also address the needs large farmers and small farmers
alike? We could also consider the importance of revenue from customs
duty, which market liberalization could erode. After all, many developing
countries initially saw no alternative to the taxation of agriculture
to earn public revenue. Finally, participation in regional trade
agreements could serve as an interim measure before commitment to
wider and deeper integration in the global market.
Part II: The state of food insecurity in the world and the important
role of agriculture
The state of world food insecurity
The World Food Summit of 1996 committed itself to halving by 2015
the number of undernourished people in the world. The mid-term review
of progress will already be taking place next year. In this connection,
FAO's latest report on the State of Food Insecurity in the World
highlights three observations:
First, an estimated 852 million people were undernourished in 2000-2002.
The number of hungry people in the developing countries only dropped
by 9 million during the decade following the World Food Summit
baseline period of 1990-1992. During the second half of the decade,
the number actually increased by almost 4 million each year, wiping
out two-thirds of the 27 million reduction recorded during
the previous five years.
Next, a large number of countries in all developing regions have
shown that success is possible. More than 30 countries, with a total
population exceeding 2.2 billion people, have reduced their
undernourishment figures by 25 percent, which represents significant
progress towards the WFS goal.
Finally, every year without progress costs 5 million and more children
their lives and developing countries billions of dollars of lost
productivity and earnings.
Each year that hunger persists at current levels will cause deaths
and disability in developing countries and related loss of productivity
of US$50 billion at present value.
The critical role of agricultural development for food security
The 30 countries that are on track to reach the World Food
Summit goal have recorded an average annual increase of agricultural
GDP of 3.2 percent, which is almost one full percentage point higher
than the developing countries as a whole.
This is not surprising if we consider that the overwhelming majority
of the world's poor and hungry live in rural areas in developing
countries and depend on agriculture for their livelihood. Agricultural
development is vital for poverty alleviation and for access to sufficient
food. One of the best options for most of these countries, if they
are to improve their food security and nutrition, is therefore to
increase agricultural productivity and raise small-farmer income.
The Anti-Hunger Programme that was developed by FAO for the
World Food Summit: five years later takes a practical look
at the investment that is needed to make agriculture more dynamic
and vibrant. It proposes a twin-track approach: first, resource
mobilization for agricultural and rural development to create opportunities
for the poor and the undernourished to raise their income and enhance
their work through competitive production, and; second, measures
aimed at meeting the immediate food and nutrition needs of the seriously
The approach of the Anti-Hunger Programme should also serve
as a model of operation at different levels to achieve the first
of the Millennium Development Goals, which is to eradicate poverty
This is also the approach of the Special Programme for Food Security
(SPFS). Launched by FAO in 1994, this programme is now operational
in 110 countries where it seeks to improve farming systems
and agricultural productivity through its various complementary
components. Most of the first countries to adopt the SPFS are now
extending their pilot phase activities to a large-scale expansion
phase. Since it was launched, the SPFS has helped to mobilize more
than US$700 million, with more than half of this sum committed
by the developing countries themselves.
The SPFS also reaches out through the Regional Programmes for Food
Security which focus on the development of regional and international
trade, and in particular enhanced capacity for quality standards
and regulations for the protection of plant and animal health. FAO
has helped 17 regional economic organizations throughout the world
to prepare their own food security programme.
These then are the questions over which we should share views and
exchange information on our respective experiences. Individual experience
is in fact fundamental for there are no clear-cut answers to the
somewhat controversial issues that these questions raise.
That is the context of the subject that is placed before this Round
Table which needs to consider the general food situation in the
world but also the pressing need to redouble our efforts if we are
to achieve the objectives of the World Food Summit and the Millennium
I thank you for your attention and wish you a lively and productive
exchange of views and experiences.
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