The FAO Director-General Jacques Diouf visited Brussels on 8 to 11 March 2011. He had bilateral meetings with the President of the European Commission, Mr José Manuel Barroso, and with the Commissioner for Agriculture and Rural Development, Mr Dacian Ciolos, the Commissioner for Maritime Affairs and Fisheries, Mrs Maria Damanaki, and the Commissioner for Internal Market and Services, Mr Michel Barnier. The actual food price volatility, the implementation of the EU Food Facility and the need for continued effort in fighting food insecurity were the main focus of these meetings. The Director-General also met with the Belgium Federal Government Prime Minister, Mr Yves Leterme, the Minister for SME, Independents, Agriculture and the Scientific Policy, Mrs Sabine Laruelle, and the Minister for Development Cooperation and European Affairs, Mr Olivier Chastel, to discuss the food insecurity situation in the world and the cooperation between Belgium and FAO. Finally, the Director-General visited the ACP Group Secretariat where he met with the Secretary-General, Mr Mohamed Ibn Chambas, and the ACP Committee of Ambassadors for an exchange of views on food insecurity in ACP countries.
What brought you to Brussels?
As you know, FAO holds annual high level discussions with the EU and the Belgian Government to discuss the global food situation and strategy to reach food security. The recent high price volatility of food commodities and its possible socio-political consequences have rendered my visit very timely in order to inform the partners and mobilize them to fight hunger and poverty in the world. The discussions focussed upon the importance for the countries to ensure food security for their populations and the necessary investments required in agriculture. The share of agriculture in official development assistance dropped from 19 percent in 1980 to 3% in 2006, and is now around 5%. The commitments taken by the African Heads of State and Governments at the Maputo Summit in 2003 to allocate 10% their national budgets to the agricultural sector within five years are today only realized in very few countries. For the EU funding for Africa in the context of the tenth European Development Fund, less than 5% are devoted to agriculture and food security. The financial commitments taken at the G-8 of Aquila in 2009 – USD 20 billion for the development of agriculture over a three year period and increased to USD 22 billion at Pittsburgh – are far from being realized.
The world population in 2050 is estimated to reach 9 billion. This means that we will need to increase the global agricultural production by 70%, and even 100% in developing countries. We have more than 120 million tonnes of cereals which are used in biofuel production instead of feeding people. Without long-term structural decisions and the necessary political will and financial resources for their implementation, food insecurity will persist, with a succession of crises affecting most seriously the poorest populations. This could generate political unrest in countries and threaten world peace and security. It could also have an impact on migration.
There is much and continued talk of yet another and more serious food crisis? Should Europeans be worried about this?
Another major food crisis could happen. The FAO Food Price Index returned to its highest level. Droughts and wildfires in Russia, together with lower crop harvest than expected, first in the United States and Europe, and then in Australia and Argentina, have triggered a process of soaring agricultural commodity prices on international markets. However, the situation that we have now is different from the situation we had in 2007/2008. In 2007/2008, the cereal stocks amounted to 428 million tones and they are currently estimated at 525 million tones, i.e. much higher. However, they are being seriously drawn down in order to meet the demand. You have also the oil price which is increasing and this has an impact on the cereal production for biofuel and for the increase of the cost of agricultural production in general.
High prices and volatility will continue in the next years if we fail to tackle the structural causes of imbalances in the international agricultural system. There is under investment in agriculture. The attention of the Governments was drawn to this at the FAO World Food Summits of 1996, 2002 and 2009. As said before, don’t forget that we will be 9 billion people by 2050 and that there are right now 925 million people hungry in the world. One of the catalytic factors of the current crisis in North Africa is the raising food prices. The world market of agricultural commodities is neither free, nor fair, with support equivalent of 360 billion US dollars being provided to the agriculture sector of OECD countries, in addition to technical barriers to trade and restrictive measures by some exporting countries. All these factors are exacerbated by speculation on the futures markets.
What is FAO doing to avert such a crisis – how is it partnering with European institutions?
The solution to the problem of hunger and food insecurity in the world requires an effective coordination of decisions on investment in agriculture, international agricultural trade and financial markets. Governments must reach a consensus on the very lengthy negotiations of the World Trade Organization and implement the commitments they made at G8 and G20 Summits to increase ODA and the share of agriculture in the financing for development. They must avoid market distortions and restrictive trade practices that are increasing the imbalance between supply and demand. There is a need for new measures of transparency and regulation to deal with speculation on the agricultural commodity markets. The problems of food price volatility will be discussed at the G20 Ministers for Agriculture Meeting in June 2011, based upon i.a. an option paper prepared under the lead of FAO and OECD. It is important to act now if we want to avoid another food crisis.