 |
|
|
|
 |
- 10/21/08: Remarks by Henrietta Fore, Administrator, USAID and Director of U.S. Foreign Assistance at the White House Development Summit
- 10/08/08: Remarks by Henrietta Fore, USAID Administrator and Director of U.S. Foreign Assistance at The President's Freedom Agenda
- 10/01/08: Remarks by Henrietta H. Fore, Administrator, USAID and Director of U.S. Foreign Assistance, at the Ceremony Marking the Full Operational Capacity of Africa Command (AFRICOM)
- 09/25/08: Remarks by Henrietta H. Fore, Administrator, USAID and Director of U.S. Foreign Assistance, at 2008 Millennium Development Goal Malaria Summit, New York - "U.S. Leadership in the Fight Against Malaria"
- 09/22/08: Remarks by Henrietta H. Fore, Administrator, USAID and Director of U.S. Foreign Assistance, at the White House Symposium on Advancing Global Literacy - "U.S. Commitment to Advancing Global Literacy"
 RSS Feed for Recent USAID Speeches and Testimony
|
|
|
|
|
|
|
|
|
|
|
|
|
Remarks by Andrew S. Natsios, Administrator
U.S. Agency for International Development
The Local Purchase Initiative
Kansas City Export Food Aid Conference
May 3, 2005
I am very pleased to be here today to discuss U.S. food aid--what we have done right in the past and what we can do to improve how we conduct our food aid programs in light of new challenges since September 11, 2001.
Last year when I was here, I talked about the success of U.S. food aid over the past 50 years and how we have assisted more than 3 billion people through P.L. 480 programs. Over the past twelve months, many of you have continued to work with people in Sri Lanka and Indonesia whose lives were devastated as a result of the Tsunami as well as people in Sudan, Ethiopia and Eritrea who have been hit hard by the equally overwhelming consequences of conflict and drought. In addition, many of your organizations contribute to long term development programs in places like Honduras and Bangladesh that strengthen communities so that when they face sudden or slow onset disasters, they are prepared and better able to cope with the setbacks. You have continued to work tirelessly to save and improve people's lives. I appreciate the partnerships we have created together to address food insecurity.
I want to take a few minutes now to talk about changes in the world over the past few years and how the change has affected our ability to meet food aid needs. Our Agency, and particularly our food programs now operate in an environment characterized by increased frequency and severity of natural and manmade disasters, terrorism, instability, the HIV/AIDS pandemic, corruption, poor governance and conflict which has led to increased population displacement.
The United States Government is facing increasing demands on its diplomatic, military and humanitarian resources. And the resources are limited. But not responding is not an option, so we prioritize and stretch the dollars to meet as many needs as possible as efficiently as possible.
At the same time, the World Trade Organization continues its debate on food aid issues in the context of the current agricultural trade negotiations. Some of the other members would like to do away with in-kind food aid such as the P.L. 480 Title II program. The U.S. has made two presentations at the WTO in Geneva on U.S. food aid policies and programs. At these presentations and in the negotiations we keep reminding member states and relevant international organizations that we must come to an agreement that will ensure 1) that we maintain adequate food aid levels to meet global needs; 2) that food aid continues to be an internationally accepted form of assistance when it targets food insecure populations; and 3) that we minimize any trade distortions. I won't belabor this any further as I know that there will be a more in-depth discussion on trade issues over the next few days. Let me just say that we will continue to try to ensure that the WTO Doha Development Round does not restrict in-kind food aid. If food aid is unduly restricted, it would inhibit development, increase food insecurity and create instability in developing countries.
In President Bush's 2002 National Security Strategy, he acknowledged the importance of fighting poverty abroad when he defined the three pillars of our foreign policy as Defense, Diplomacy and Development. Recognizing that we cannot address all of today's problems using our military or diplomatic resources, he emphasized that what we do as development practitioners can also serve to protect vital American national interests.
In January of this year, USAID released a paper focusing attention on failing, failed and recovering states known as the Fragile States Strategy. The strategy provides a focal point for the USAID Bureau for Democracy, Conflict and Humanitarian assistance in defining its priorities and in carrying out its humanitarian assistance role. The strategy promotes four basic objectives for carrying out work in fragile, failed and failing states which are to: 1) improve monitoring and analysis; 2) ensure that priorities respond to realities on the ground; 3) focus programs on the source of the fragility or weakness; and 4) create or use streamlined operational procedures to support rapid and effective response.
Failed states are both the incubator and sanctuary for terrorists. Where there is no effective national government to control terrorist organizations, these groups will flourish. It was no accident that Sudan, Somalia, and Afghanistan served as the base of Al Qaeda training and planning. As the National Security Strategy document so succinctly puts it: "America is now threatened less by conquering states than by failing ones." We now know by painful experience that we are not immune from the consequences that arise from state failure on other continents.
Our underlying priorities, in working in fragile states, are to increase stability, promote security, encourage reform and build institutional capacity. This will address the causes of fragility as opposed to simply targeting symptoms. The President's 2006 budget proposes reforms which will give USAID the programmatic tools to deal with fragile states.
In crisis situations, strategic programming of food aid can stabilize a fragile economy by supporting local farmers and maintaining demand for the locally produced goods, despite the low purchasing power of those requiring assistance. Famines can be demand driven or supply driven. A supply driven famine is caused by reduced food production and rising prices. In this case, importing U.S. food to increase the food supply would be an appropriate response. A demand driven famine is caused by the collapse of family livelihoods and the inability of families to access food, even where there is adequate supply and low prices. In cases where the food supply is adequate and prices stable, but where families cannot afford to purchase the food, an appropriate response would be to purchase what is available locally to assist the food insecure rather than adding U.S. food to the local supply which could depress local prices and further aggravate the economy.
As with all of our work in fragile countries, we need to take a close look at all of our options when responding to needs. The work is getting more rather than less arduous and it is evident that we must expand the ways in which we conduct our business. The old way of doing business is insufficient to meet the mounting food needs in this new environment given our limited dollars.
Despite all that we are doing, and all that the rest of the world is doing to win the war on hunger, the number of chronically malnourished people in the world continues to rise, now totaling more than 850 million people. And though the prevalence of undernourishment has fallen in 30 developing countries since the early 1990s, poverty and conflict have contributed to its growth elsewhere.
In the past decade, and especially in the past several years, conflict-related emergencies and natural disasters have created global food needs beyond the capacity of the U.S. and other donors to respond using the options currently available to us. In specific situations, when food pipelines break or when conflicts pause and we need to move food in quickly to save lives, we need to be able to access food more quickly.
In his book on famine, Fred Cuny stated that "the chances of saving lives at the outset of a [relief] operation are greatly reduced when food is imported. By the time it arrives in the country and gets to people, many will have died." He goes on to say that "evidence suggests the massive food shipments sent to Ethiopia in 1985 had little impact on the outcome of the famine . . . and that by the time it arrived in sufficient, steady quantities in the rural areas, the death rate had peaked and was already declining."
Some of the starkest evidence we have of deaths directly related to a slow food aid response took place in Gode, Ethiopia, the epicenter of the 2000 famine there, which threatened over 10 million people with starvation. While the famine was eventually averted -the Center for Disease Control has estimated that in Gode, 20,000 deaths resulted from the crisis in that region alone with an estimated 78,000 deaths in four other regions. Seventy-seven percent of the deaths in Gode occurred before the major relief interventions began in the summer of 2000 and more than half of the deaths were of children under the age of five.
One way to respond to the needs more quickly is to purchase food locally, but this requires us to have access to cash. When food emergencies are a function of localized drought, conflict or crop failure from disease or locusts with food available close-by, local purchase can be critical.
USAID is searching for innovative ways to stretch its dollars and meet the needs of the most vulnerable populations with emergency and developmental food assistance. One way of doing this is to provide cash which could be used to purchase food in the country or region where an emergency is taking place.
For FY 2006, President Bush has taken the initiative to provide this tool to USAID humanitarian officers and has put a request into the FY 2006 budget asking that $300 million be shifted out of P.L. 480 Title II and into the International Disaster and Famine Assistance (IDFA) account to be used as cash for meeting emergency food needs. Specifically, the President stated in his budget that "This funding will permit USAID to provide food assistance in the most timely and efficient manner to the most critical emergency food crises. This assistance will be used in those instances where the rapid use of cash assistance is critical to saving lives."
One of the factors behind this request is the length of time that it takes to ship food commodities from the United States to an emergency. Shipping in-kind assistance from the U.S. normally requires three or four months to arrive at an emergency distribution point once it is ordered. Having the option to purchase the food in the same country or region where an emergency is happening would enable us to get food to hungry people faster. It would save lives and would fill a critical gap until U.S. commodities arrive at the site. In addition to providing a faster option, local purchases of food will, in many cases, save the dollars that would otherwise have been spent on transportation costs, allowing us to purchase additional food aid to feed more people.
The primary purpose of the Title II program is to save lives and having more flexibility in our programs to use cash to buy food locally will save lives. The fact that U.S. farmers and shippers are able to benefit from the Food for Peace program is an important, but secondary benefit. It is not the primary objective of the program. The primary objective is to save lives.
In responding to pending crises, USAID has limited options:
- We can order a shipment of U.S. commodities which can be expected to arrive at the distribution site within 3 to 4 months of purchase.
- We can access food from pre-positioned U.S. commodity stocks or swap commodities from other food pipelines. However, the limited pre-positioned stocks are not always adequate or suitable for every situation and increasingly thin pipelines have lately rendered swaps infeasible.
- Within the past year, we have established a pre-position warehouse in Dubai, UAE to store commodities until they are needed in an emergency. While this is extremely useful, we cannot always preposition the amount or appropriate mix of commodities that would be needed in every emergency. Also, pre-positioning will not solve every problem. For example, currently Ethiopia is facing an unexpectedly severe food crisis and while the current supplemental budget has a sizeable increase in food aid, it cannot be used to order food until the President signs it. When this happens, we will need to order the commodities in the U.S., ship them, and then wait for them to arrive in Ethiopia several months from now. Needless deaths will occur while we wait. If we had the flexibility to purchase food locally, we could purchase the commodities in or near Ethiopia once the legislation is signed, getting the food to the people who need it months sooner. This is not a hypothetical situation--it is taking place as we speak.
- Another option that we have to meet emergencies is to divert U.S. commodities headed to other programs on the high seas. And while this has been done, it is an extremely costly intervention. It means that another program will suffer, and ultimately means less money for commodities.
- The ability to purchase food supplies in local or regional markets would give us one more option for meeting critical needs. While this will not always be viable, this flexibility will make a difference in the reduction of human suffering.
I want to be very clear that this requested change is not an attack on the U.S. farmers or the U.S. maritime industry. The contributions that many of you have made in feeding hungry people overseas is notable and will continue to be a critical, basic component of how the U.S. conducts it's management of food aid. The Administration has no intention of changing how the United States runs its food aid programs in general. This is not the beginning of a push to make our food aid program an all-cash program. I personally would oppose any kind of proposal to make more than one quarter of our food aid budget available for local purchase. The greater portion of U.S. food aid must continue to be purchased in American markets where the supply is assured for emergencies where large volume is needed.
One thing that I have been asked repeatedly is: How will we sustain support on Capitol Hill for these humanitarian food aid programs, if the benefits to the U.S. agricultural and shipping industries are perceived to be decreased? The budget for OFDA, the Office of Foreign Disaster Assistance, and the Refugee Program budget have been as stable in funding as the Food for Peace budget, and these two budgets contain no guaranteed purchase of U.S. commodities. Americans, including those who have been intimately involved in our food aid programs in the past, will strongly support USAID's effort to improve the U.S. food response to humanitarian emergencies by making that response as flexible and effective as possible to save more lives and reduce suffering. I believe that compassion for those who are suffering is part of the moral fabric of this society. This was evident to me in the massive outpouring of private cash contributions to help the victims of the Tsunami and I believe that it holds true here.
Stretching our emergency resources further will also help to protect our development programs from being tapped to meet emergency needs.
I know that many of you have questions about how we will run this program and I will try to answer as many of them as possible.
The Administration has requested that the money be placed in the International Disaster and Famine Account. This is the emergency account managed by our Office of Foreign Disaster Assistance. However, the $300 million designated to this account for the purchase of food aid will be managed by the Office of Food for Peace, which currently manages the Title II food aid program. As Food for Peace currently has the responsibility for and the expertise in managing food aid, they are the appropriate group to administer this money. The money, like current Title II money, will be programmed primarily through NGOs and the World Food Program.
One of the questions that I have been asked is: Is there enough food available in local markets to meet our emergency needs? Though local purchase will not support all of our food aid initiatives, there is food available for purchase in developing countries. In 2004 more than $680 million worth of food aid was purchased from developing countries by WFP in order to meet local food aid needs. Developing countries able to supply food aid commodities have included (but are not limited to) Indonesia, Pakistan, South Africa and Sudan. This method not only provides food more quickly and more cheaply, it also supports the local economy and helps improve the livelihoods of poor farmers.
We follow the principle of "Do no Harm" in local markets. The $300 million will not all be used to purchase and program food in a single country, but in a variety of countries, reducing the impact on local markets. We also intend to apply Title II legislated requirements such as Bellmon and Usual Marketing Requirement, where local purchases are conducted to ensure that there will be no displacement of commercial sales, or negative impact on local markets.
I have also been asked several times why we can't just use our notwithstanding authority under Title II to make local purchases. I have been told in no uncertain terms by our USAID lawyers that we cannot use our notwithstanding authority for local purchases. Title II authorizes the donation of American agricultural commodities. Notwithstanding authority was not intended for, nor can it be used to create additional authority that would allow the purchase of foreign commodities. The notwithstanding clause can waive existing federal laws which slow down emergency response, but it cannot be used to invent new authority not now available under Title II. As it is currently written, Title II can not be used to purchase commodities locally.
We do not intend for this money to be used in purchasing commodities from other developed nations. If food aid is not available for local purchase under appropriate market conditions in developing countries with some proximity to the emergency need, the food aid will be purchased in the United States.
I want to close with another example of where this type of program could be used effectively.
In the past in southern Sudan, small farmers in the fertile western farming areas have often produced small grain surpluses, while hundreds of thousands of Sudanese in other parts of the country have urgently needed food aid. If we were able to strategically and carefully buy the surpluses to meet food aid needs elsewhere in the same country, we would end up sustaining and improving the lives of both groups. Should signatories comply with the July Peace Accords, there is a real possibility that agricultural output could return to its former level and the region would once again act as an important regional cereal supplier. However, if using donated food commodities from the U.S. remains our only option, we risk lowering demand for the local production and destroying price incentives for the local farmers to improve their production to meet future food aid needs.
I would be happy to take your questions.
Back to Top ^
|
