Will US embrace boosting farm aid in world food crisis

from Reuters

By Missy Ryan

WASHINGTON - As the world rushes to reverse decades of declining farm aid for poor nations, the United States remains committed to food aid programs that critics say cannot cure the causes of the global food crisis.

Last month, some 70 aid groups and private companies, such as DuPont Co and Mars, appealed to the U.S. Congress for greater funding for farm development aid overseas.

U.S. support for such programs -- teaching farmers better techniques, helping them access higher-yield seeds -- has dwindled to a tiny share of the aid budget. It will equal an estimated 2 percent of next year's aid funds.

"This is occurring at a time when global demand ... has increased, global stocks of grain are low, and food prices for people in poor countries are rising," the groups said.

The U.S. Agency for International Development spent just $283 million on farm aid in 2008, not including development work funded by some food aid programs.

Support for long-term farm aid may finally be on the rebound as the crisis, rooted in soaring prices of food crops, raises doubts about whether the current system of global agriculture can feed a growing world population.

Last week, world leaders huddled in Rome for a United Nations summit, asking governments, multilateral bodies and the private sector to help poor countries expand food output.

Leaders at the summit pledged $6 billion in new funds to cut hunger and dependence upon imports in poor nations. If fulfilled, the step would reverse years of declining support.

The World Bank will fast-track $1.2 billion to help countries manage the crisis immediately, and expects to add up to $2 billion in new longer-term support in the coming year.

The Bush administration, for its part, plans to spend $5 billion this year and next on food security, but has pledged only $150 million in new funding for farm development.

David Orden, an agriculture expert at the International Food Policy Research Institute, wondered "how willing is the U.S. to really participate along those lines?"

U.S. officials point to their robust food aid programs. Washington leads the world in emergency food aid donations, spending an annual $2 billion in recent years.

"There's a very mixed message," Orden said.

A report from a government watchdog showed U.S. development aid for agriculture in Africa, where farm yields lag sorely, dropped substantially from around $500 million in the late 1980s to under $100 million two years ago.

The watchdog concluded that food aid helps during emergencies but "does not address the underlying factors that contributed to their recurrence and severity."

That is a contrast to the Green Revolution that sharply boosted crop yields in India and elsewhere from the 1950s.

"The Green Revolution successes lulled the world into believing that the food production problem was solved," Amit Roy, a U.S.-based fertilizer expert, said last week.

A SHIFT AWAY FROM FARM AID

According to IFAD, a United Nations agency, global development assistance for agriculture dropped from 18 percent of all foreign aid in 1979 to less than 3 percent in 2006.

Peter O'Driscoll, executive director of ActionAid USA, traces the shift to the early 1980s, when donors embraced liberalized trade and hoped poor nations would succeed under a new model where small-time, low-technology farming had failed.

"This is classic trade theory: don't produce things you produce inefficiently," O'Driscoll said. Donors also embraced other priorities, such as aid to battle HIV/AIDs and improve education and governance.

Farm aid has no major constituency in the United States, said Bob Thompson, a professor at the University of Illinois at Urbana-Champaign who directed rural development at the World Bank. He cited a common belief that "foreign aid is money poured down a rathole."

One U.S. official, requesting anonymity, noted a "need to focus on some of these medium- and longer-term structural issues" in farming, but not at the expense of other needs.

"There's an understanding that food aid alone to respond to a crisis is not the only response," he said.

In May, PresidentBush announced a package of $770 million in food security funds, mostly food aid, to help staunch hunger in the burgeoning food crisis. He has also dipped into an emergency food aid trust several times.

Ellen Levinson, who advocates for aid groups that want a larger share of emergency food aid used to fund development work, said "just running in with large food distributions ... will not stop the cycle of hunger and poverty."

The U.S. official said no major ramp-up in farm aid was planned but some fiscal 2009 spending could focus on responding to food price increases, for example shifting support from cocoa or coffee to staple crops.

The Bush administration also has promised around $1.7 billion to farm sectors in eight African countries through a separate aid initiative. A small share has been disbursed.

Orden expects Washington may ramp up farm aid in areas that reflect free-market beliefs, such as encouraging private companies to partner with poor farmers.