Mr. Chairman, Mr. Secretary General of the UN, Mr. Director General, Excellences, Distinguished participants, Ladies and Gentlemen:

It is a great honor and privilege to represent my country at the World Food Summit held in an ancient city, magnificent Rome. It is also a great pleasure to convey greetings to the participants of the Forum from the President of the Republic of Azerbaijan H.E. Mr. Heydar Aliyev and his wishes of fruitful and successful deliberations in addressing one of the most serious challenges we all facing today.

Poverty and food famine, indeed, not only morally unacceptable nowadays but also detrimental to social and economic development, as well as politically dangerous. They closely intertwined with such evils of modern realities as terrorism, drug trafficking, smuggling of arms and human beings and armed conflicts thus contributing to global insecurity and instability. Shocking events of the September 11th is a vivid evidence of it.

Therefore, it is difficult to overestimate the importance and significance of the Millennium Declaration, Monterrey Consensus, World Food Summit and approaching World Summit on Sustainable Development, putting combating poverty at the core of global development.

Azerbaijan as a young state, country in transition, land-locked and beyond that conflict affected country falls into the group of most vulnerable countries in a rapidly globalizing world and among those that are in need for international support and assistance. Conducive external environment is therefore crucial for the sustainable development of these countries.

However we clearly understand, Mr. Chairman, that major efforts should be undertaken at national level to ensure sustainable development. Sound market-oriented reforms, democratization of all spheres of social life, integration into the world economy reveal enormous potential inside the country as well as attract so much needed external resources for the development

Mr. Chairman, let me now give you brief account of the current situation, recent developments, progress made as well as problems we are confronting on the way of meeting the objectives of the 1996 Summit.

Azerbaijan has gained its independence in 1991, however country has been able to embark upon market-oriented reforms only since 1995 after internal political situation was stabilized and cease-fire agreement was reached with Armenia in an armed conflict over Nagorno Karabakh region of Azerbaijan.

Coherent and consistent policies of reforms for the last 7 years in close cooperation with all major international institutions has succeeded in achieving impressive results in macroeconomic stability, structural changes, attracting FDI and, as a result, maintaining an overall rapid growth.

However, we cannot be fully satisfied with the progress made as development is driven mainly by the energy sector and limited to a narrow spectrum of industries as well as regions and areas of the country. Enormous potential of the economy, in particular in agriculture still remains untapped, and significant part of the population, especially in rural areas still living in poverty.

Agriculture is one of the most important sectors of the economy constituting about 20% of the GDP, with about 35% of population employed and half of the population or about 4 million people living in rural areas.

Since gaining independence most radical reforms have been pursued in agriculture in order to facilitate restructuring, reorganization and diversification of the sector as well as enhance self-sufficiency in agricultural produce. Lands has been put for privatization as well as state-owned farms, significant tax incentives have been introduced for farmers in terms of tax holidays, special preferential import duties to encourage import of machinery and equipment, know-how and materials for agricultural needs. All debts of the state farms had been written off before getting privatized, discounted prices had been set for oil products for 2 years, prices on agricultural products liberalized. Food Security Program has been adopted.

Development of countryside and agriculture is also at the core of the poverty reduction strategy, implementation of which should be started soon. Major attention has been put on non-oil and SME sectors development. Necessary incentives are being introduced to encourage private investments in those areas. Due to support and assistance of IFIs and donor countries micro-financing facilities are now available in the country to support these developments.

As a result of the radical reforms in agriculture today the share of private sector in agricultural production constitutes 99%. An average growth rates in agriculture has been about 7-9% for the last 3 years. Rate of sufficiency in food products, particularly in meet, milk and diary products (62,4%), eggs (32,8%), cereals (69,5%), fruits and vegetables have been considerably increased.

Significant attention and measures have been undertaken for the protection and preservation of nature and natural resources and environment, preservation of bio-diversity, selection and improvement of seeds, development of husbandry and fisheries, protection of forests and effective use of water.

However, regardless of all the efforts, 68% of population still living below the poverty level. Poverty rate is particularly high in the rural areas, where average monthly per capita income is only $US 14. Countryside population is suffering also from significant shortages in supplies of electricity (92% of rural population) and gas (65%), drinking water (55%), inadequate social infrastructure (60%)./p>

Productivity of the sector remains low. Access of farmers to machinery, equipment and fertilizers as well as to financial resources lacks well behind the needed level. Lack of distribution infrastructure and storage facilities is resulting in high rates of crops loss: 25% in grains, 30% in vegetables, 20% in fruits, amounting to US$ 220M a year.

Serious threats to the development are being imposed by the changes of climate and natural disasters. Continuous droughts have led to the erosion, salinization and desertification of 49% of the country's territory. As a result, water resources decreased up to 45-50%, forests - by 11%. 120 thousand ha of the coastal arable lands became unsuitable for agriculture as a result of recent rises of the Caspian Sea level.

Mr. Chairman, I would like to draw your attention to the most serious and acute problem my country has been confronting for over a decade in fighting poverty problems. As many of you might know Azerbaijan is affected by one of the most protracted conflicts with unprecedented in its scale and magnitude consequences and implications. Fifth of the territory is under occupation, over a million of refugees and displaced persons (every 8th person) are scattered across the country living in temporary camps in misery and poverty. Needless to say that it imposes an enormous burden on the economy and society and has most serious implications on mobilization and distribution of resources for development.

More aid and assistance is badly needed to prevent these people from further degradation and human tragedy, to help them to remain as an integral part of society and get actively involved in social and economic live. Majority of these people had been engaged in agriculture..

Besides, 300 thousands ha of arable lands remain under occupation seeded with mines not with crops, brutal destruction of forests accelerated land erosion.

Mr. Chairman, the situation in the South Caucasus is a clear testimony of how conflicts and their consequences contribute to the poverty and famine. That is why we firmly believe that conflicts and conflict-affected areas should be given adequate attention and international community should be more coherent and consistent in pursuing and endorsing of its values, norms and principles if we sincerely want to build a better future for all.

Mr. Chairman, summing up, let me assure you that Azerbaijan remains committed to the objectives of the World Food Summit and Millennium Declaration and will consistently pursue policies aiming at meeting these objectives. Agriculture of Azerbaijan possesses enormous potential and obvious and strong comparative advantages. Azerbaijan can easily increase rate of… reach self-sufficiency in food and agricultural products and develop significant export potential. However, to overcome mentioned above bottlenecks and problems, country lacks much needed resources. Therefore we call for more assistance and closer cooperation with the international community.

In conclusion, Mr. Chairman, let me wish successful work to this Forum.

Let me also express our appreciation of the tireless efforts of the Director General of the FAO Mr. Jack Diouf in bringing these issues to the focus of international agenda and wish him success in his activities. Using this opportunity I would also like to thank the Secretariat of FAO for excellent organization of this event and its staff for their kind assistance throughout our stay here.

Finally, I would also like to express our gratitude to the Government of Italy for hosting this Summit and extended genuine hospitality to our delegation.

Thank you for your kind attention.