International assistance for food and agriculture has seen a dramatic drop since the late 1980s, with the share of agriculture in ODA and funding for food aid both falling. The food price rises and climbing rates of global hunger that occurred as a result of the 2007-08 food price rises have not yet led to a significant reversal of these trends. The lacklustre global commitment to food and agriculture is disconcerting in a context where food prices have remained high and famine is currently gripping parts of the Horn of Africa.
Agriculture used to have a prominent role in development assistance programs. But according to the OECD, the share of agriculture in official development assistance (ODA) fell from approximately 17 percent in the late 1980s to around 6 percent today, which is up from below 4 percent in 2003.
Recognizing that this level of support for agriculture was unacceptable, the G8 countries and others pledged at the L’Aquila summit in 2009 to mobilize US$20 billion over a three year period for investments in sustainable agricultural development as part of the L’Aquila Food Security Initiative (AFSI). This funding pledge was reiterated by the G20 at Pittsburgh later that year. The G8 and G20 both endorsed the World Bank managed multilateral fund, the Global Agriculture and Food Security Program (GAFSP), as a key channel for these funds. It should be noted that not all of this US$20 billion is new funds over what these donors had already pledged.
Have donors lived up to their commitment for increased agricultural assistance? Two full years later, only US$ 925.2 million has actually been pledged to the GAFSP, and only just over half of that amount was actually received. And only some US$345 million in project funding decisions have actually been made through this funding window.
The 2011 G8 Deauville Accountability Report notes that in fact only 22 percent of the amount pledged for the AFSI has already been disbursed, indicating that much of the funding is not being channelled through the GAFSP, but rather is being channelled bilaterally. The report also notes that the scope, components and time periods of the pledges are different for each donor, making the process of tracking progress on this pledge “challenging.” According to the report, an additional 26 percent of the funds are on track to be disbursed; donors are expected to disburse all of the pledged funds by 2012. The current financial crisis may change priorities, but we won’t know until the end of 2012 how donors fared on this front.
The other area key area where support is needed is emergency food aid. The World Food Programme (WFP), which relies on voluntary contributions for its budget, has faced a serious challenge raising the funds it needs to address emergency crises such as the current famine in the Horn of Africa. Indeed, it has struggled to raise funds to meet its annual budget in recent years, with 2009 being an especially difficult one. Donors, in other words, have held their purse-strings tight, forcing the WFP to pass around the hat in times of crisis and in some cases to cut rations.
At the same time, it is unclear whether donors will agree to a collective commitment as part of the current Food Aid Convention renegotiations. If the FAC donors fail to agree to a combined annual food aid commitment under this agreement, the WFP will be left in an even more uncertain funding situation because a large share of its food aid funding comes from these donors. By the end of July this year, the WFP had received just over US$2 billion in funding from donors out of a projected US$6 billion budget. This precarious situation strengthens the argument for a portion of the WFP’s funding to be guaranteed through the UN. World Bank President Robert Zoellick called for such a change in WFP funding in 2008. No action has been yet taken in this direction, leaving the WFP still at the whim of donors’ changing aid budgets.
The global community could do more to live up to its pledges to provide assistance for agriculture and food security, especially in these times of heightened food prices and growing global food emergencies. Assistance to build resilient agricultural systems in developing countries is required if those countries are to better prepare themselves to bounce back from shocks without needing to rely on food aid. But to hold back funds for food aid before the broader agricultural assistance is provided leaves those countries even more vulnerable. Agricultural assistance and food aid must be carefully coordinated.
The decline in agricultural investment and increased reliance on food aid in poor countries took place over a period of some 40 years. It occurred in a context of rich country agricultural subsidies, market distorting food aid practices (especially non-emergency aid) and unbalanced trade, all of which reduced incentives for local production in developing countries. The situation won’t be reversed overnight. It will require increased, coordinated and sustained assistance.