8. The Council approved the report of the Fifty—third Session of the Committee on Commodity Problems (CCP). While noting that the value of world agricultural trade had risen substantially in recent years, the Council expressed concern that many commodities of export interest, particularly to developing countries, faced depressed market conditions and that the value of agricultural exports from developing countries had declined by about 3 percent in real terms in 1980. In contrast, the agricultural imports of the developing countries had risen by 23 percent in 1980 with particularly large increases in imports of foodstuffs. As a result, the agricultural trade balances of all major developing regions had deteriorated and the overall agricultural trade surplus of developing countries had declined from about US$ 15 billion in 1978 and 1979 to less than US$ 6 billion in 1980. The Council noted with concern that the main factors which constrained the growth of developing countries' exports in 1980 persisted and the prices of many of their main agricultural export commodities continued to fall or remained low in 1981. It endorsed the decision of the Committee to continue to make a detailed examination of the main commodity issues including an analysis of the principal causes and possible remedial action, as adopted.
9. The Council agreed that protectionism was a global problem affecting both developed and developing countries. It stressed that it was essential for governments to resist pressures for increased protection and to make all efforts to reduce existing trade barriers. It endorsed the decision of the Committee to continue to review systematically developments in protectionism that might affect the trade prospects of agricultural commodities, in the context of the Conference Resolution 2/79. Some members suggested that a programme of action to liberalize trade in agricultural commodities within a specific time frame should be developed based on the recommendations contained in the Conference Resolution 2/79.
10. Many members pointed out that protectionist policies unduly stimulated production in countries which applied such measures and also depressed consumption of these countries. In their view, high levels of protection, especially when accompanied by export subsidies, constituted a major constraint to the growth of trade of agricultural and processed agricultural products, and denied markets and foreign exchange earnings to low cost producing countries. These members referred to the high level of protection for sugar production in the EEC and stressed the harmful effects of highly subsidized exports of sugar by the Community, on the trade of other sugar exporting countries, particularly developing countries.
11. The representative of the EEC stated that the Community had recently introduced new elements in its sugar policy with a view to reducing excess production. He also informed the Council that recently the Community had decided to hold exploratory talks with the members of the International Sugar Agreement on the possibility of the Community membership in a revised and improved sugar agreement.
12. Many members considered that the overall results of the Multilateral Trade Negotiations for trade in agricultural and processed agricultural products were very limited especially in relation to the objective of achieving a substantial increase in the foreign exchange earnings of the developing countries. In their view the negotiations had failed to make significant progress in reducing non-tariff barriers which constituted the main obstacle to the expansion of agricultural trade.
13. The Council welcomed the adoption of the recent agreement establishing the Common Fund for Commodities, and expressed the hope that the Fund would be ratified and become operational at an early date so that it could contribute to the solution of long-standing commodity and trade problems.
14. Some members supported the proposal made by the Delegate of Canada at the Committee that the Consultative Sub-Committee on Surplus Disposal (CSD) should, within the terms of its mandate, be vigilant to new developments which could adversely affect the normal patterns of production in international trade and consider whether amendments or clarifications were needed in the FAO Principles of Surplus Disposal andor the Consultative Procedures. Several other members, however, considered that CSD fulfilled its role to the mutual satisfaction of all parties concerned and that there was no need to revise the FAO Principles of Surplus Disposal and the Consultative Procedures.
15. Some delegates drew attention to the Committee's discussion of the possibility that the EEC would impose a tax on imported and domestic vegetable oils. In reply to a query, the Secretariat informed the Council that, since the CCP meeting, the EEC Commission had reportedly decided not to propose a tax on vegetable oils. The Commission had apparently established a strategy of other actions and negotiations which was aimed to solve the problems of olive oil in the enlarged Community. However, the strategy still seemed to envisage the possibility of a tax on vegetable oils being required towards the end of the transitional period following Spain's entry, depending on the results of the other actions and negotiations. The Council was informed that the Secretariat intended to prepare a paper concerning these and any other developments for presentation to the next session of the Intergovernmental Group on Oilseeds, Oils and Fats, scheduled for March 1982.
16. The Council regretted the continuing absence of a consensus which would prompt the resumption of negotiations on a new Wheat Trade Convention. Many members stressed the urgent need for a joint effort to resolve the differences in order to conclude such a Convention. The delegate of a major wheat exporting country stated that while his government was fully committed to finding ways of securing world food security, it recognized the reality that a breakthrough on negotiations on a new convention was not imminent. In its view, rather than persistent calls for a resolution of differences, it would be more productive for countries to take unilateral action to do what they can to contribute to world food security.
17. Some members referred to the importance of banana exports to many developing countries in Africa, Asia and Latin America and suggested that the Committee should review the medium-term outlook for world banana trade and prices with a view to finding appropriate solutions to the serious problems facing bananas.
18. The Council discussed this item on the basis of document C 81/24, "International Agricultural Adjustment : Third Progress Report". It also took note of paragraphs 88-92 of the Report of the Fifty-third Session of CCP (CL 80/6) which had reviewed progress as outlined in an advance summary of the Conference document.
19. The Council noted that International Agricultural Adjustment would be considered at the Conference under Item 7.1, in Commission I, when the detailed discussion of substantive aspects would take place.
20. The Council agreed with the overall assessment of the CCP that while there had been some positive developments in the directions indicated by the 11 policy guidelines of International Agricultural Adjustment as formulated by the Conference in 1975, progress had been uneven and on balance it had been seriously inadequate.
21. Concern was expressed particularly regarding the failure of food production in the developing countries to reach the target of four percent annual growth. If food production lagged, other objectives of International Agricultural Adjustment could not be attained. Attention was drawn to the importance of adequate incentives to producers. These incentives ranged from broad orientations of economic policy to specific aspects such as prices received by producers, costs of inputs and levels of investment. Some members gave instances of positive results on production of improving incentives.
22. The Council was advised of difficulties faced by developing countries through unfavourable international trade conditions for agriculture, especially those arising from protectionism in developed countries. While international assistance was still considerably below levels envisaged in the guidelines, a favourable development was the increase in the share of multilateral sources in the provision of assistance to agriculture. Delegates from several donor countries reiterated the importance they attached to assistance to food production and nutritional improvement in their own bilateral programmes.
23. The Council considered that, as intended by the 1975 Conference, the guidelines gave a global frame to food and agricultural policy in a world of largely interdependent countries, and over time, the guidelines had tended also to become reference points for the Conference to assess progress periodically. To fulfill adequately this useful role of the guidelines, however, the availability of data would need to be improved especially in such fields as investment and nutrition. Analytical improvements suggested for future monitoring reports included giving more attention to the USSR and Eastern Europe as major influences on the world grain situation; more differentiation to be made between higher income and other developing countries, and examination of the extent to which developing countries were using pricing policy as an incentive to production.
24. The Council agreed that paragraphs 88-92 of the CCP report together with the relevant paragraphs on International Agricultural Adjustment from its own report should be tabled at the Conference to assist discussions.
25. In introducing the subject, the Executive Director a.i. informed the Council that the Committee on Food Aid Policies and Programmes (CFA) had approved a pledging target of $1 200 million for WFP's regular resources for the biennium 1983-84 at its Twelfth Session in October 1981. He hoped that the Council would endorse that target, which he had proposed to the CFA with the support of the Secretary-General of the United Nations and the Director-General of FAO, and recommend its adoption by the FAO Conference at its Twenty-first Session. He observed that the proposed target had been endorsed by ECOSOC on 2 November 1981 and was being submitted to the current session of the United Nations General Assembly for adoption.
26. The Executive Director a.i. stated that, in his view, the proposed target was a balanced one and represented the best compromise between what was desirable and what was possible. It was the absolute minimum needed if the current levels of WFP food deliveries out of the Programme's own resources were to be maintained after 1983. In 1980, WFP supplied about one million tons of food from its own resources and contributions to the Food Aid Convention (FAC) channelled through the Programme, plus some 300 000 tons from the International Emergency Food Reserve (IEFR). Out of the total shipments of about 1.3 million tons, 66 percent was for development projects and 34 percent for emergency operations. The Programme was concentrating a very high proportion of its development assistance on priority countries and projects. In 1981, of the new commitments for development projects, about 85 percent went to low-income, food-deficit, countries and about 80 percent was directed to projects in support of agricultural production and rural development. About 45 percent of the Programme's new commitments for development projects in 1981 was approved for African countries south of the Sahara. WFP food purchases were being increasingly made in developing countries to stimulate development, foster cooperation among developing countries and save on transport costs. The Programme was diversifying its project designs to ensure greater compatibility with specific conditions of countries and regions. In those various ways, WFP was making a concerted effort to ensure that its food aid for development responded to the requirements of developing countries.
27. The Executive Director a.i. recalled that the target for the current biennium (1981-82) had been set at $ 1 000 million. By the end of October 1981, contributions had reached about 75 percent of that target. More resources were expected to be made available, however, as less than half the biennium had passed. The proposed Pledging Target for the biennium 1983-84 represented an increase of 20 percent in dollar terms over the target for the current biennium. He stressed therefore that additional efforts would be needed by those donors whose generosity had made WFP's activities throughout the world a model of inspired international cooperation to help accelerate development and alleviate human suffering. He emphasized that new donors would also have to come forward. The proposed Pledging Target would then not only be reached but, if possible, surpassed, thereby allowing for an element of growth in WFP deliveries and supported projects.
28. The Council unanimously endorsed the Pledging Target for voluntary contributions to WFP's regular resources for the period 1983-84 of $ 1 200 million. In doing so, it expressed great satisfaction on the achievement and management of WFP and its full support of the objectives and priorities of the Programme. The Council agreed that the pledging target represented the best compromise between what was desirable and what was possible to achieve. A number of members expressed the view, however, that it should be regarded as a minimum target, taking into account the growing needs of developing countries for food aid. The Council urged that traditional and all potential donors should make a concerted effort, in a spirit of international solidarity, not only to reach the target but to surpass it, in view of the precarious food situation in many countries and regions of the developing world. Similarly, the Council also urged traditional and all potential donors to make every effort to reach the Pledging Target of $ 1 000 million established for the current biennium. Some delegations expressed the hope that centrally planned developed countries contribute to the Programme as well as other countries in a position to do so. The Council noted with particular appreciation the substantial new contribution made recently by the OPEC Fund and the first contribution made to the IEFR by Austria and Spain. It also noted that significant contributions of a number of donor countries, including Argentina, Australia and Italy. Noting the crucial importance of cash resources for the Programme's activities, a number of delegations appealed to donors to comply with the provision in WFP's General Regulations which stipulates that the cash and services components of pledges should amount, in the aggregate, to at least one third of total contributions. The Council unanimously adopted the following resolution concerning the target for WFP pledges for the period 1983-84:
TARGET FOR WFP PLEDGES FOR THE PERIOD 1983-84
THE COUNCIL,
Having considered the sixth annual report of the Committee on Food Aid Policies and Programmes,
Noting the comments of the CFA concerning the target for voluntary contributions to the Programme for the period 1983-84,
Recalling resolutions 2462 (XXIII) and 2682 (XXV) of the General Assembly, which recognized the experience gained by WFP in the field of multilateral food aid,
1. Submits for consideration and approval of the Conference of FAO the attached draft resolution,
2. Urges States Members of the United Nations and Member Nations and Associate Members of the Food and Agriculture Organization to undertake the necessary preparation for the announcement of pledges at the Tenth Pledging Conference for the World Food Programme.
TARGET FOR WFP PLEDGES FOR THE PERIOD 1983-84
THE CONFERENCE,
Recalling the provisions of Resolution 4/65 that the World Food Programme is to be reviewed before each pledging conference,
Recalling the provisions of operative paragraph 4 of its Resolution 10/77 of 30 November 1977 that, subject to the review mentioned above, the next pledging conference should be convened at the latest early in 1982, at which time governments should be invited to pledge contributions for 1983 and 1984, with a view to reaching such a target as may be then recommended by the General Assembly and the Conference of the Food and Agriculture Organization of the United Nations,
Recalling the recommendation contained in paragraph 90 of Resolution 35/36 of the General Assembly concerning the International Development Strategy for the Third United Nations Development Decade that the resources of the World Food Programme be augmented and that every effort be made to reach the target agreed upon for each biennium during the Decade for the Programme's regular resources,
Noting that the review of the Programme was undertaken by the Committee on Food Aid Policies and Programmes of the World Food Programme at its Eleventh Session and by the FAO Council at its Seventy-ninth Session,
Having considered resolution 1/80 of the FAO Council as well as the recommendations of the Committee on Food Aid Policies and Programmes,
Recognizing the value of multilateral food aid as implemented by WFP since its inception and the necessity for continuing its action both as a form of capital investment in economic and social development projects and for meeting emergency food needs;
1. Establishes for the two years 1983 and 1984 a target for voluntary contributions of $1 200 million, of which not less than one third should be in cash and/or services in aggregate;
2. Urges States Members of the United Nations and Member Nations and Associate Members of the Food and Agriculture Organization of the United Nations to make every effort to ensure the full attainment of the target;
3. Requests the Secretary-General, in cooperation with the Director-General of FAO, to convene a pledging conference for this purpose at the United Nations Headquarters early in 1982;
4. Decides that, subject to the review provided for in Resolution 4/65, the following pledging conference at which governments should be invited to pledge contributions for the biennium 1985-86 with a view to reaching such a target as may be then recommended by the General Assembly and the Conference of the Food and Agriculture Organization, should be convened at the latest early in 1984.
1CL 80/6; CL 80/PV/1; CL 80/PV/6.
2C 81/24; CL 80/PV/1; CL 80/PV/6.
3CL 80/LIM/2; CL 80/PV/2; CL 80/PV/6.
