Monday, September 1, 2008

World Bank Calls for Urgent Action on Food in advance of Development Aid talks in Ghana

As international development agencies, donors and civil society groups head to Ghana to discuss improving aid effectiveness, the World Bank is calling for immediate action to drop restrictions on food assistance. The Bank says ending earmarking and requirements to buy food aid from donors would go a long way to ensuring food gets to poor people hit hardest by rising prices.

“Ending restrictions would help bring relief to millions of people suffering from high food prices and would be a concrete sign of the international community’s commitment to making aid more effective,” said World Bank Managing Director Ngozi Okonjo-Iweala speaking ahead of a September 2-4 conference in Accra, Ghana on aid effectiveness. “There is no time to waste. Onerous conditions on food aid should be removed to ensure that food gets quickly to where it is most needed.”

With 100 million people at risk of falling into poverty from high food prices, the Bank is calling on the international community to increase contributions to the World Food Programme, whose funding needs almost doubled to $6 billion this year. It will likely need equivalent funding next year.

"We cannot afford to let the world's attention drift," said Okonjo-Iweala. "People are still hurting from high food prices. They need our support now."

The Bank is also calling for the immediate elimination of taxation or restrictions on humanitarian food aid (certainly for World Food Programme purchases) and an end to export bans by key producers on shipments to the least developed countries and those in fragile situations.

"These three steps: removing restrictions and conditions on food aid; increasing contributions to the World Food Programme; and lifting export bans and restrictions on the movement of humanitarian food will protect thousands of mothers and children at risk from malnutrition," Okonjo-Iweala said. "In addition donors must support investment in an African Green Revolution so that millions will not suffer in the future."

The 'Third High Level Forum on Aid Effectiveness' in Accra brings together members of the global development community: donors, country partners, civil society groups and international development agencies committed to making aid more effective and delivering better results to the poorest people. Participants will agree on a new consensus approach, the ‘Accra Agenda for Action’, to improve impact on the ground including: better coordination, more transparency, strengthened accountability and a focus on development results.

Since the previous conference held in 2005 in Paris, nearly 60 countries have made progress in strengthening their national development strategies. But much remains to be done, particularly on donor co-ordination, and there has been slippage in some areas.

The World Bank supports the Accra Agenda for Action, and calls for bold new steps to:

Honor the commitments made in 2005 at the Gleneagles G8 Summit to increase official development assistance (ODA) to $130 billion per year. Currently there is a $39 billion annual shortfall.
Increase the predictability, flexibility and the amount of food assistance – including by replacing tied aid with cash so food can be purchased locally and get where it’s needed fast.
Increase transparency – so donors and country partners can see aid flows and better attack corruption.
Channel more aid through country budgets – to help build capacity and local institutions.
Bring in the new, non traditional donors, and promote South-South partnerships.
Make aid faster and more flexible – to respond better to shocks such as food and fuel price hikes.
Make greater use of multi-donor trust funds – pooling resources can cut costs and administrative procedures for partner countries.
Support Innovation – using new financial instruments to tap changing markets such as crop or disaster insurance and local currency financing.

"Improving aid effectiveness makes the case for scaling up aid much easier," Okonjo-Iweala said. “Putting developing countries in the lead, expanding transparency, deepening donor partnerships and speeding up aid to address crises and deploying new financial instruments to deliver aid in new ways are all crucial steps. Strengthened country ownership, must also bring with it strengthened country responsibility for taking action on good governance and corruption."

As President Johnson Sirleaf of Liberia has recently emphasized, aid effectiveness is also crucial to help strengthen and simplify the investment climate for private sector development. "This is what will ultimately create jobs in Africa as it has done elsewhere," Okonjo-Iweala said.
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