APPENDIX D

STATEMENT BY THE DIRECTOR-GENERAL

Mr Chairman,
Distinguished Ministers,
Your Excellencies,
Ladies and Gentlemen,

This is the thirty-fifth session of the Council to be held since I took office in January 1976. Far from feeling jaded, I extend with renewed pleasure my warm welcome to the members and observers gathered here today.

As you know, I have always attached supreme importance to the Council's deliberations and decisions. The impressive list of functions assigned to you by the Basic Texts clearly spells out your vital role in formulating and guiding the Organization's policies and programmes. Each session brings new issues and the need to adjust your approach to recurring items as new circumstances arise. As we listen to your views and instructions, the one thing we will not have to fear is boredom.

Never before has the Council had an agenda packed with so many important items. It is hard to see how you will find the time to dwell on each of its 27 items, particularly as some of these include a number of subitems. Fortunately, the Council's committees have already clarified the issues and prepared the ground for the more important decisions. And so, apart from my customary reluctance to anticipate your discussions, my introductory statement will only cover certain points on your agenda and touch upon the issues on which your views, guidance and directives are most eagerly awaited.

Tradition has it that each Council session begins with a global review of the state of food and agriculture, the first of the tasks assigned to you by the General Rules of the Organization.

The cruel glare of media attention conveys man-made disasters with such impact, such violence even, that we can easily lose sight of the full picture. No sooner do our thoughts turn to the world food situation than our mind's eye fills with heartbreaking images, and we see the African continent scorched by wars that leave in their trail hunger and famine in countries such as Somalia, Angola, Mozambique, Liberia, the Sudan and, most recently, Rwanda. In the Near East and as far as Afghanistan, wars that have been left to smoulder or that have abruptly rekindled have spread hunger and malnutrition on a scale that is difficult to assess, but whose first victims are, as always, the weakest: women and children, the poor and the elderly. Nobody knows exactly what is happening in the vast Caucasus region where the collapse of the Soviet empire has unleashed furious fighting and bloody slaughter. Among the horrors and ordeals endured by the long-suffering population of Bosnia and Herzegovina there is also hunger; and this is happening on our very doorstep, closer to Rome than Geneva or Marseilles.

Humanity's insane urge to destroy is not the only reason for which entire populations have to go hungry. Less spectacularly, for natural or economic reasons other countries are also encountering food supply problems, particularly in Africa, where the ranks of the undernourished have swelled, but also in Latin America and the Caribbean. The whims of nature have also inflicted serious food shortages on Africa yet again.

Although these tragedies touch us all, we must not be obsessed by this dimension alone. Even where violence, bloodshed and death seem to be the order of the day, there are men and women who refuse to abandon their fellow human beings and who are striving to provide them with clothing, food and medical care. Among those working under truly appalling conditions, stretched to the very limits of endurance and sometimes at the cost of their lives, we can point with pride to many members of our own international community.

Although we have not been very successful in our efforts to check man-made disasters, the past year has shown that we can avert food crises brought about by natural causes. As you know, following a prolonged period of serious drought, food production slumped heavily in southern Africa in 1991/92. Yet, even in the absence of prior arrangements for the large-scale operations that were so urgently needed, the international community responded with remarkable speed and effectiveness. The alarm was raised in good time, thanks particularly to our Global Information and Early Warning System; the generous pledges made by the donors were immediately acted upon; and well-coordinated relief was swiftly delivered and distributed. Considerable suffering was averted and the response was also instrumental in restoring production capacity. Experience shows that we can in fact mount a worldwide food security effort to offset natural disasters if we want to. It also further confirms the validity of our approach, which views relief, rehabilitation and development as a continuous spectrum and the short-, medium- and long-term picture as a single entity.

Even amid the worst crises there were always some grounds for hope, but the overview of the food situation now looks more reassuring. Global food production picked up in 1992, which enhances future prospects for food security.

Although production and consumption slumps in many low-income food-deficit countries are a definite source of concern, it is encouraging to note that world cereal stocks are now above the minimum level that we consider necessary for world food security. Admittedly, preliminary forecasts point to a shortfall in this year's production of grains which would require some drawdown of carryover stocks, but the prediction is for bumper harvests in the developing countries of the southern hemisphere.

As I see it, we can continue to pursue our mandate with less cause for anxiety for, although we face some tough and pressing problems, the overall outlook is reasonably good. Foremost in my mind is the future of agriculture and its ability to provide for a world population that will continue to grow for several decades to come. Our study Agriculture: toward 2000 was a decisive step in approaching this crucial problem, in mat it evaluated population growth and production potential at different levels of cropping intensity. In the light of the outcome of the two major world conferences in 1992 - the United Nations Conference on Environment and Development (UNCED) and the International Conference on Nutrition (ICN) - we are now putting the finishing touches to an extremely thorough study which is to be submitted to the next session of the FAO Conference. It takes up, refines and adds to the earlier study and extends its scope to the year 2010.

The whole of FAO has helped to prepare this exceptional document which provides a definitive review of the situation. In my opinion, this work is a remarkable example of how the Organization perceives and fulfils its mission as a scientific centre for the promotion of effective development. I am sure mat it will be invaluable to the Conference in its search for lasting solutions to these major world problems, and that it will provide Member Nations with a unique tool for policy planning.

Another area in which we carry out innovative work that is unparalleled in the world is in the conservation and the rational and equitable use of one of humanity's major assets: its plant genetic resources. We are proud of the confidence that our work in this sector has inspired, as reaffirmed on numerous occasions by the Commission on Plant Genetic Resources, the Council and the Conference itself. The Member Nations' invitation to pursue this work and to extend our activities to animal genetic resources is a powerful source of encouragement and reinforces our aspirations.

The discussion on organizing another world conference on plant genetic resources fits into this context. In agreeing in 1991 to this new international meeting, the FAO Conference specified that the funding would have to come from extrabudgetary resources, although finding donors in the present economic climate is not an easy undertaking. Assuming, however, that this problem can be solved, and with due consideration to the interests at stake, FAO will have to prepare and conduct this meeting with all due impartiality and independence.

Two points that arose during the meeting of the Committee on Fisheries held in March 1993 open particularly attractive prospects for our work: the drafting of a code of conduct on responsible fishing, and the preparation of an agreement on the flagging of vessels fishing on the high seas.

We have long known that the unregulated exploitation of marine resources results in stock depletion and destroys species along with their natural habitats. We have also been trying for some time to regulate the fishing effort and fishing techniques so as to make maximum sustainable yield compatible with resource conservation. The strategy and programmes of action adopted in 1984 by the FAO World Conference on Fisheries Management and Development were a major milestone in our pursuit of international discipline. However, in practice, private interests and the lure of quick profit all too often continue to eclipse the long-term interests of all. The International Conference on Responsible Fishing held in Cancún therefore established a set of priorities that should lead logically to the adoption of a corresponding code of conduct. FAO is proud of the responsibility given to it in this connection, as it confirms the value that the Member Nations place on the regulatory efforts based on moral commitments that we have made over many years in many fields.

It is abundantly clear that unscrupulous shipowners are resorting increasingly to flags of convenience to circumvent regulations for the protection and management of fishery resources. This led to the call for an agreement specifying the responsibilities of states in flagging vessels from other countries and in the control of the high-sea fishing fleets that fly their flags. Here again, FAO has been asked to do the groundwork and to come up with a tentative draft agreement, which has already been examined by the Committee on Fisheries and is now submitted for your consideration.

Both instances involve proposals that may lead to decisive breakthroughs but are also extremely sensitive, for what are needed are international instruments that have regulatory muscle but do not encroach on the sovereign rights or legitimate interests of individual countries. Only an intergovernmental organization can provide the experience and impartiality required for such an undertaking, yet another proof that multilateral action is irreplaceable. We firmly hope that, following the Council's deliberations, the next session of the Conference will be able to make significant progress toward solving these important questions.

The Council is also called upon to examine a proposal for a field programme committee. This proposal, which is made without supportive or explanatory documentation, is not a new idea; rather, it can be likened to Nietzsche's "eternal recurrence". For the benefit of members who have only recently joined the Council, the proposal goes back to 1988-89 when FAO's activities were subjected to one of the most intense reviews undergone by any intergovernmental organization.

After careful consideration, the independent experts appointed to examine our field operations discarded the proposal, which they felt was not the best way to reinforce supervision by Member Nations. Instead, they concluded mat the same objective could be attained using more appropriate and less expensive means, a position subsequently ratified by the Programme Committee, the Finance Committee, the Council and the Conference.

In 1991 the Conference approved the arrangements adopted as they enabled the Regular Programme and the field activities to be considered as a single, integrated programme, while respecting the specific funding arrangements for the latter - UNDP, trust funds and TCP.

Nobody claims this to be a sacrosanct system that cannot be changed. It would seem to me, however, that any alterations dictated by experience should be introduced progressively and without causing disruption.

Whatever the case, our field activities do not take place in a vacuum or devoid of control by the Member Nations. On the contrary, the technical, political, administrative and financial aspects are all closely monitored. And there are countless occasions for discussing them.

I felt duty-bound to make these observations, based on my considerable experience at the head of this Organization, even though the final decision, of course, rests with the Conference.

One of the more important decisions made by the Conference in 1989 in response to the conclusions of the Review was to devise a medium-term plan to accompany the biennial Programme of Work and Budget. The first, covering the period 1992-97, was well received by the Conference, in 1991, and this was a stimulus to us during the preparation of the Medium-term Plan for 1994-99.

Following the requests and suggestions made by the Conference, we have tried very hard to establish a firm link between this perspective study, which takes us up to the third millennium, and the detailed proposals that are included in the Programme of Work and Budget for 1994-95. We believe that we have presented a realistic outlook for the year 2000, with a growing emphasis on sustainability as the decisive criterion.

Using this analysis, the Plan charts the major intersectoral priorities that are to hallmark all of FAO's activities: the environment and sustainable development; consultative work on policy questions; people's participation in development, with special emphasis on the role of women; combating poverty; nutrition and food security; and economic and technical cooperation among developing countries. The main lines of our programmes in the various sectors and parts of the world thus fall naturally into place.

The Medium-term Plan is, then, a clear and coherent whole that we submit confidently and in eager anticipation of the Council's views and suggestions.

As I have just emphasized, the Medium-term Plan and the Programme of Work and Budget for the biennium are closely linked despite their separate identities, a link that can essentially be summed up in a single word: continuity. However, in preparing the hard and fast proposals for the 1994-95 biennium, we found ourselves faced with a classic Hegelian dialectical dilemma.

Thesis. Every year the world's population grows by about 100 million, of whom 90 million are in the developing countries, with the result that more and more resources must be allocated to improve food production and distribution. Meanwhile, the poverty-stricken, debt-burdened and problem-plagued Third World countries need an ever-mounting flow of aid, services and advice, which means that the resources made available to FAO must be sharply upscaled.

Antithesis. The world economy is in full recession, so that the poor countries are hard put to meet their financial obligations to this Organization, and even the very richest countries are struggling with severe problems of unemployment, social costs, cost-effective production, competitiveness, pollution, monetary stability and the costs of maintaining peace. Therefore, a way must be found to downscale contributions.

The Programme of Work and Budget is expected to reconcile this tangled web of contradictions in a harmonious synthesis acceptable to all. We spared no effort in tackling this problem, which was much like trying to square a circle. The Summary before you is the outcome of our efforts, with significant inputs from the Council committees, which helped us to hone our priorities.

First of all, taking into account the full facts and, in particular, the views of the committees, I decided, however reluctantly, to submit a budget that does not provide for any net programme growth: a no-growth budget. This term should not, however, be misinterpreted; "no-growth" is not the same as "negative growth", despite those who would have us absorb increased costs. The fact is that for a number of years we have regressed in real terms. In view of the demand engendered by today's burgeoning population and given the situation of the Third World countries, it would be immoral to reduce our resources and I, in all conscience, find myself unable to suggest that we do so.

Second, I should like to remind the Council that the 1992-93 biennium was a one-off situation that the Conference specifically stated was not to constitute a precedent. Whereas the approved programme involved a cost of US$676.9 million, the budgetary appropriation was only for US$645.6 million, which meant a US$31 million shortfall from the very start. If we manage to implement our programme, it is mainly thanks to the payment of arrears during the biennium. I want to make this very clear: in real terms, the total figure that I propose for 1994-95 corresponds to the same programme level that was unanimously approved for 1992-93.

This brings me to the third element of our synthesis; the total contribution asked of each Member Nation will be less than, or essentially of the same order of magnitude as, that of the preceding biennium. There are two reasons for this: one, the decline of the Italian lira with respect to the dollar (over 30 percent); and, two, the use of arrears payments to cover budgetary expenditure. As the Council knows, FAO, like the other UN agencies, has three sources of funding to cover programme costs: contributions of Member Nations based on an agreed scale of assessments; miscellaneous income such as investment earnings; and arrears payments. Such are the provisions of the financial regulations: arrears are used to cover the costs of implementing the Programme of Work, just as the miscellaneous income and the contributions. Based on the commitments we have received, we expect substantial inputs from this source in 1994-95.

To sum up, the priorities that I propose are substantially geared toward the directives issued by the bodies responsible for advising the Council, that is, the technical committees and the Programme and Finance Committees. Having said this, the document before you is a summary, and hence open to modification in accordance with your reactions to its recommendations. I am quite willing to review the priorities again and to give every possible consideration to the expression of your views to guide the preparation of the full and final version of the Programme of Work and Budget.

In discussing the programme another question crops up: how to implement it once it has been approved. Here I should like to touch on three areas: the financial situation, the staff, and Headquarters accommodation and facilities.

After years of hardship, difficulties and anxiety, I think I can now say mat FAO's finances are in good shape and, hopefully, will remain so. We can now look with detachment at a fairly strange paradox. Even at the lowest ebb of the cashflow crisis, FAO's finances remained in order; we never failed to hold the Organization's expenditure to the limits set by our governing bodies in virtue of payments due. The books show this. Only exceptional delays in the settlement of payments denied us the necessary liquidity to keep both the Organization and its programme execution in good running order.

No sooner had the situation improved than FAO's typically painstaking and careful management began to pay off, as late payers began to settle their arrears. Current contributions are now coming in at a faster pace than at any time during the last five years, so that the bottom line for 1993 looks quite positive. If arrears payments, particularly those of our major contributor, continue to come in as pledged during the Conference, there will certainly be no need to resort to external borrowing as in the past, and probably not even to internal borrowing. The most important and likely consequence of this will be to make funds available which, in accordance with current procedures, will be immediately used to contain the 1994-95 contributions and implement the approved programmes.

In all candour, I must say that this crisis has left its mark on the period we have just been through. First, and most important, it penalized the Member Nations who most needed our services. Next, it presented a daunting and near-impossible task to those who devotedly serve the Organization. Furthermore, on a personal level, it has weighed very heavily on the last years of my term of office. And so I am all the more happy and proud to leave behind me a sound financial situation, with FAO well and truly in the black.

I have just spoken of the recent hurdles our staff have had to overcome to accomplish their mission. I take this opportunity to commend the competence, dedication and courage of this hard-working, zealous team of men and women, most of whom you do not know, who daily strive to bring us a little closer to the attainment of FAO's noble aims.

It is they, as I have said on many occasions, who constitute the lifeblood of FAO, a vital force whose continuity, regrettably, now appears to be seriously endangered. While some staff members are approaching retirement, others are leaving through discouragement and because they are tired of not being able to do their job the way they think it ought to be done. Others are leaving because the terms of employment do not - or no longer - allow them the peace of mind they need to concentrate on their work without worrying constantly about providing for their families and raising their children. How can we hope to fill these gaps, so long as other employers can offer better remuneration, more benefits and more stable employment?

Discontent is rampant among those now on board, particularly among the professional staff who have experienced a real slump in purchasing power as a result of the devaluation of the Italian lira. Dollar remuneration has dropped by as much as US$1 500 per month for mid-ranking staff members, and by even more for others.

For their part, general service employees are increasingly concerned that the methodology used to calculate their remuneration is now being questioned, and they fear mat developments in the future may dash their legitimate hopes both for their salaries and for their pensions.

I feel a moral obligation, particularly to FAO, to sound a serious warning before it is too late. Unless effective measures are taken to correct these unfair distortions, we shall continue to dishearten the staff, to lose our best people, and to find ourselves unable to replace them.

On many past occasions I drew attention to the severe handicap placed on staff welfare, and thereby on FAO's efficiency, by inadequate Headquarters accommodation and antiquated facilities.

I need hardly remind you of Italy's consistently generous and exemplary response to my proposals for the expansion and modernization of the accommodation provided, at no expense to us, by our host country. Italy has made an enormous financial effort to cover the cost of these major works, which will amount to over US$30 million in all.

I think I may express the hope that, when the time comes, the Conference will find the appropriate gesture to commend the Government of our host country in the way in which it so richly deserves.

FAO's own services have made an extraordinary parallel effort to modernize and to renovate the restaurant and bar facilities which had become unacceptably out of date after 40 years of use.

Meanwhile, we have developed and implemented an integrated data network linking some 3 000 computer terminals and 1 600 telephones. The state-of-the-art technology selected will give the Organization the most modern headquarters in the UN system, will result in economies, and will make it possible for us to intervene more promptly and more effectively. The staff has gone along gracefully with the inevitable inconveniences of this major operation.

The pace of the work, for which the Organization has committed nearly US$10 million of its own funds in addition to the massive outlay made since 1980 for computerization, has been exceptionally vigorous. The new Building F was fully equipped with the integrated data network in record time, exactly two months to the day the contract was signed.

The completion of all this work will coincide with the end of my misson. My colleagues at Headquarters, who have been working apart for 30 years, will finally all be together under one roof at the Caracalla complex. For me, this will represent the culmination of my determined efforts, over many years, to achieve a result of which FAO can be proud. The Organization now has a building complex that is vast enough to house all the services of its Secretariat, on an incomparable site, boasting a technology that will allow it to take up the challenges of the twenty-first century with confidence.

Mr Chairman, I have never been less than candid with the Council about the many alarming aspects of the world situation - food problems, poverty and environmental degradation among them -and I have no intention of ducking those issues today. Indeed I mentioned some of them at the beginning of my statement. Nor have I ever been less than honest about the problems that weigh upon FAO's present and future, of which the most crucial and worrisome at present are those of the staff.

At the same time, this past year has been studded with outstanding key events in areas of concern to us, most notably UNCED and our own ICN. We have also worked hard and well. I have mentioned our major study on agriculture up to the year 2010, the Medium-term Plan and the modernization of FAO Headquarters, but these have not been our only areas of concern.

As I see it, the importance of all of these new elements lies mainly in the exciting prospects they open up, allowing us to view FAO's future with confidence and even with a degree of cautious optimism.

Our ship has gone through storms and suffered damage and, although the wind is still strong, the sky has cleared and the seas have subsided somewhat. The timbers and the rigging have held fast, the route has been plotted and we are right on course. FAO has a great mission to accomplish, and the continual requests for its services are a clear token of its reputation for reliability and excellence. While I have briefly touched upon our work in fisheries and in plant and animal genetic resources, FAO has also been designated lead agency to promote international cooperation in implementing UNCED's Agenda 21 as it relates to food, agriculture and forests. And in the wake of the very successful ICN, FAO and WHO are jointly responsible for deciding on ways and means to implement and follow up on the measures set out in the World Declaration on Nutrition and defined in the Plan of Action for Nutrition.

The importance of the private sector as a driving force in development and the possibility of cooperation between FAO and the private agro-industries active internationally are points that I brought up at the last Council meeting. Discussions are under way with the representatives of those agro-industries, and I hope, without being certain, to be in a position to submit specific proposals at the next session of the Conference.

On the eve of its fiftieth anniversary, FAO takes up these new and promising tasks with a clear mind, a firm grasp and sound financial support. A number of initiatives are now ripe for the decisions of the Council and the Conference so that these great ideas can be given form and substance. With a calm and hopeful heart I now entrust them to your wisdom and care, and to your concern to improve what Olivier de Serres called "man's nourishment".

Thank you very much.