G20 Joint Finance and Agriculture Ministers Meeting Statement
by Dr QU Dongyu, FAO Director-General
11/10/2022
G20 Joint Finance and Agriculture Ministers Meeting
Statement
By
Dr QU Dongyu, FAO Director-General
11 October 2022
Excellences,
Dear Colleagues,
1. I wish to start by thanking the Indonesian Presidency for its commitment to advance global food security under the G20 agenda jointly.
2. With the overlapping crises of global impact - the COVID-19 pandemic, economic downturns, disruption of international supply chains, conflicts and the war in Ukraine, we are facing a serious food access crisis.
3. In September, FAO’s Food Price Index averaged 136.3 points - 5.5% above its value one year ago.
4. Prices of most foodstuffs remain high and continue to be under upward pressure due to a range of factors, including:
• declining stocks for some commodities,
• high energy and fertilizer costs,
• poor weather conditions in several key producing countries,
• uncertainties related to trade policies, and
• risks associated with the ongoing conflict in Ukraine.
5. With the majority of countries experiencing food price increases between 10 and 30% over the previous year, domestic food price inflation is of particular concern, especially for the poorest and most vulnerable who spend a higher share of their incomes on food.
6. In addition, the weakening of national currencies against the US dollar also contributes to increased food import bills, and exerts additional fiscal pressure on these countries.
7. The situation is of particular concern in low-income food-deficit countries, which are facing financial constraints to pay for their food import bills.
8. For the 62 most vulnerable food-deficit countries, the food import bill has increased by 24 billion US dollars, affecting 1.79 billion people.
9. As a result, they are buying less food, but paying higher bills.
10. Responding to these challenges often entails increased budgetary costs that will have to be met by increased government borrowing and austerity measures.
11. This can have major repercussions on economic growth, undermining poverty eradication efforts and compromising efforts to meet the SDGs.
12. In this regard, I welcome the IMF’s Executive Board decision approving a Food Shock Window to provide access to emergency financing for countries facing balance-of-payment problems related to the global food affordability crisis.
13. While the Food Shock Window is in line with FAO’s proposed Food Import Financing Facility (FIFF), we need to think about those countries not only getting food for a short time, but also of their capacity for efficient food production.
Dear Colleagues,
14. As we look ahead, it is important to be aware that the main drivers of food crises – lack of investment in agrifood systems and rural areas, research and development, direct impacts from conflict and insecurity, extreme climatic events, and economic slowdowns - are expected to persist in 2023.
15. The high costs of energy, inputs, production and trade are likely to have a major impact on the coming agricultural seasons: farmers may produce less, export less and earn less.
16. These factors can increase putting us at risk of facing a food availability crisis.
17. We must all work together to prevent such a scenario!
18. We must:
• One: Support food access for all poor and vulnerable countries and populations;
• Two: Expand social protection programmes and humanitarian assistance. Households in protracted food-crisis contexts need urgent and sustained support to meet their food needs;
• Three: Commit to an open, predictable and well-functioning global market and trading system. I particularly urge all countries to keep international supply chains and logistic operating smoothly.
• Four: Maintain close dialogue with the G20 Agriculture Ministers, supporting them in their work and objectives. This is essential!
19. It is important to undertake a systematic analysis of the impact of high food and fertilizer prices on countries’ finances and economies, to guide the collective response of the G20,
20. And to gather information on gaps and opportunities required to enhance synergies and future actions based on AMIS since 2011.
21. FAO stands ready to contribute technically to such a mapping exercise and agrifood system transformation,
22. Working in partnership with the World Bank and other International Financial Institutions, and international organizations for producing more with less.
23. In doing so, however, we must avoid duplicating ongoing efforts, but should build upon initiatives that have already proven to be valuable.
24. FAO is fully committed to work together with our partners to transform to more efficient, more inclusive, more resilient and more sustainable agrifood systems for better production, better nutrition, a better environment and a better life for all, leaving no one behind.
25. Allow me to conclude by congratulating the Indonesian G20 Presidency for bringing us together, and facilitating this critical cross-sectoral dialogue.
26. Thank you.