**Statement by Michael W. Yost**

**Administrator of the Foreign Agricultural Service**

**U.S. Department of Agriculture**

**Before the**

**Subcommittee on Specialty Crops, Rural Development, and Foreign
Agriculture**

**House Agriculture Committee**

**Washington, DC**

**Wednesday, July 16, 2008**

Mr. Chairman, members of the subcommittee, I am pleased to appear before
you today with James Kunder, Acting Deputy Administrator of the U.S.
Agency for International Development (USAID). The U.S. Department of
Agriculture, USAID, and all of our partner agencies and organizations
are proud of the role we play in helping countries overcome hunger and
malnutrition. I will review USDA's efforts to deliver international food
and agricultural development assistance.

**FOOD ASSISTANCE PROGRAMS**

The two food assistance programs administered by USDA's Foreign
Agricultural Service (FAS) are making a difference in the lives of poor
and hungry people: the Food for Progress (FFP) Program and the
McGovern-Dole International Food for Education and Child Nutrition
(McGovern-Dole) Program. These programs provide international assistance
and support development activities that alleviate hunger and improve
nutrition, education, and agriculture in some of the world's poorest
countries.

FFP is targeted to countries that are making strides toward democracy
and private enterprise. The program emphasizes private sector
agricultural and economic development and enhanced food security in
recipient countries. In fiscal year 2007, USDA implemented 21 Food for
Progress agreements in 15 countries with a total program value of nearly
\$120 million. Ongoing activities are reaching well over one million
beneficiaries, including farmers and their families, community members,
cooperatives, producer groups, and small agribusinesses. Activities have
included improving agricultural techniques and marketing systems,
providing education to farmers, helping to develop cooperatives,
teaching irrigation and land conservation techniques, supporting
agribusinesses and microcredit enterprises, and other activities that
build the capacity to trade.

The McGovern-Dole Program supports education, child development, and
food security in low-income, food-deficit countries that are committed
to universal education. The program provides donated U.S. agricultural
products, as well as financial and technical assistance, to our
partners, who creatively combat hunger and strengthen the quality of and
access to education. In addition to providing food for direct
distribution, USDA has provided cash resources for school-related
infrastructure improvements, teacher and parent-teacher association
training, and school gardens. Since 2000, the McGovern-Dole Program has
provided meals to feed more than 22 million children in 41 countries and
boosted school attendance.

For both the FFP and McGovern-Dole Programs, FAS works closely on food
assistance and agriculture development projects with USDA's Farm Service
Agency, USAID, and our partners, including private voluntary
organizations (PVOs), cooperatives, intergovernmental organizations,
foreign governments, and the United Nations World Food Programme. Each
fiscal year it is necessary to:

-   Determine priority countries based on the objectives of each program
    and factors such as per capita income levels, prevalence of
    undernourishment, movement toward freedom, adult literacy rates,
    government commitment to education, and degree, if any, of civil
    conflict; and

-   Evaluate and select proposals based on specific criteria. These
    criteria are program-specific and may include assurances that
    commercial markets will not be disrupted; tangible benefits exist
    for the country's agricultural sector; the recipient country is
    committed to improving its quality of education and nutrition; and
    the program is sustainable after USDA funding ends.

    **TRADE-CAPACITY BUILDING**

Food aid is just one component in our global assistance efforts.
Trade-capacity building (TCB) allows USDA to lend its expertise in
agriculture, food, and trade to support market-based agricultural
development and help countries create regulatory systems that enable
them to produce safe products for domestic consumption and for trade
with other markets, leading to economic development and growth.

Because of limited FAS resources, TCB is a shining example of how we
coordinate with other agencies within USDA, and other parts of the U.S.
government, as well as with universities, PVOs, and the private sector.
For example, we rely on the technical expertise of USDA's Food Safety
and Inspection Service (FSIS) to conduct food safety seminars, USDA's
Animal and Plant Health Inspection Service (APHIS) to explain U.S.
import requirements, and USDA's Cooperative State Research, Education,
and Extension Service (CSREES) to connect us with experts at land-grant
and historically-black colleges and universities. We all have a common
goal to provide the means for people to lift themselves and their
countries out of poverty and into sustainable and ultimately viable
economies that can trade in the world market.

Our TCB activities with developing and transitional countries facilitate
trade, promote food security, and increase the ability of developing
nations to participate in global agricultural markets.

For example, our Cochran Fellowship Program helps middle-income
countries and emerging democracies develop the capacity to trade through
short-term, market-oriented agricultural training in the United States
targeted at senior and mid-level specialists and administrators from the
public and private sectors. The program helps eligible countries develop
agricultural systems that meet the food needs of their citizens and
strengthens and enhances trade linkages between eligible countries and
agricultural interests in the United States.

Since its inception in 1984, the Cochran Program has provided training
for more than 13,000 international participants from 103 countries
worldwide, including the President of Albania, the Prime Minister of
Moldova, and Madagascar's Minister of Land Reform, Fields, and Urban
Planning.

The Norman E. Borlaug International Agricultural Science and Technology
Fellows Program provides collaborative research training for entry-level
international agricultural research scientists and policymakers from
developing and middle-income countries. Training takes place at U.S.
universities, USDA or other government agencies, private companies,
not-for-profit institutions or international agricultural research
centers through exchanges that foster the transfer of scientific and
technological advances in agriculture, and that address obstacles to the
adoption of technology, such as ineffectual policies and regulations.

Since 2004, the Borlaug Program has grown from training 33 Fellows from
five countries to 310 Fellows from 40 countries in 2008.  Notable
graduates from the Borlaug Program include the Director of Animal
Industry and Fisheries in Uganda's Ministry of Agriculture, the
Assistant Director for Nigeria's National Institute of Agronomic
Research, and the Director of the Quality Mark and Certifications
Department in Oman's Ministry of Agriculture.

FAS' Trade and Investment Missions (TIMs) target emerging markets and
free trade agreement (FTA) countries to promote two-way trade and
investment. The missions form partnerships between local agribusinesses
and U.S. financiers and agribusinesses. The missions provide U.S.
participants with focused one-on-one meetings with host country business
representatives. In addition to furthering business opportunities, these
discussions also identify and address trade barriers. Financial support
to U.S. and host country businesses is facilitated through the
Export-Import Bank and other investment brokers.

TIMs have been conducted in many countries and regions. Since 2005,
missions to East Africa, the Republic of Georgia, Kazakhstan, North
Africa, Southern Africa, and West and Central Africa have generated an
estimated \$45.8 million in two-way trade.

**HOW THESE PROGRAMS WORK TOGETHER**

Let me give you an example of how FAS weaves all these programs together
in one region of the world to provide an integrated approach to
developing stable, secure economies that can become reliable trade
partners and markets for U.S. agricultural products now and in the
future. The Dominican Republic-Central America Free Trade Agreement
(CAFTA-DR) is notable for being the first U.S. trade agreement that
includes trade capacity building in its structure. We are using all of
our tools---food and technical assistance, trade-capacity building and
training programs---to help our partners in this region realize the
benefits of free trade.

For example, in Honduras, USDA is working with Catholic Relief Services
(CRS) to implement a McGovern-Dole Program agreement to improve access
to quality education in 15 Honduran municipalities where malnutrition
exceeds 60 percent. In 2006, CRS used 4,400 metric tons of U.S.-donated
food valued at \$3.4 million to provide daily meals to more than 32,700
students in 658 elementary schools. Take-home rations were delivered to
more than 13,000 children under the age of five. The free school
breakfasts and dry rations have allowed parents to use their resources
for other purposes. The project also included the delivery of take-home
rations to nearly 7,000 pregnant women and new mothers.

Several complementary activities are being supported by this project,
which will improve sustainability, education, and hygiene. More than 120
gardens or fish ponds have been built, teaching parents and
schoolchildren new ways to produce food and providing food and income
for the schools. Elementary and pre-school teachers from the schools
continue to receive training through organized workshops in mathematics
and Spanish. The program has improved sanitation systems and
infrastructure for 77 of the neediest 100 schools. Work is continuing at
the remaining 23 schools. Employment opportunities have been created
through handling and distribution of the food and the construction of
the new infrastructure.

In Guatemala, FINCA International, a PVO, implemented an FFP agreement
in 2006 that used 8,000 tons of U.S. soybean meal and 2,000 tons of U.S.
tallow to generate \$3.2 million in proceeds to support a micro-credit
program. The proceeds were used to develop a village banking program
tailored to the specific needs of Guatemala's rural entrepreneurs. The
program brings neighbors together, giving them the collective power to
disburse, invest, and collect loan capital. Clients report improved
earnings and family nutrition, high loan repayment rates, and increased
empowerment. Last August, former Agriculture Secretary Mike Johanns met
with Guatemalan women who had used these loans to develop small
businesses, all of which were generating income to support their
families.

Also during this trip, former Secretary Johanns announced that USDA
would lead an agribusiness trade and investment mission to the CAFTA-DR
region in the near future. This mission will provide an excellent
opportunity for U.S. and Central American agribusinesses to develop
commercial ties, expand two-way trade, and promote foreign direct
investment.

In Nicaragua, Cochran Fellowship Program alumni made valuable
contributions to improving their country's national trade policies and
regulatory frameworks, resulting in increased market access for U.S.
agricultural products. The four alumni received Cochran training in
agricultural biotechnology. Upon their return home, they provided expert
consultations to the Health Commission of the Nicaraguan National
Assembly, which enabled the Commission to send a positive report on a
comprehensive Biosafety Bill to the President of the National Assembly.

Under the Borlaug Program, USDA has formed a partnership with the World
Cocoa Foundation to provide a specialized program to help the cocoa
industry in CAFTA-DR countries, Africa, and South East Asia combat cocoa
pests and diseases, build trade and scientific capacity, and improve
regional cocoa production and market access. USDA is seeking a total of
14 fellows from these cocoa-producing countries---four from CAFTA-DR,
seven from Africa, and three from South East Asia---for this new
initiative. 

**RECONSTRUCTION AND STABILIZATION IN AFGHANISTAN AND IRAQ**

Finally, I would like to discuss USDA's role in rehabilitating the
agricultural sectors in Afghanistan and Iraq. Our assistance in these
efforts is a critical component to the economic, political, and security
environment in both countries. In Afghanistan, 80 percent of the
population is involved in farming and herding. In Iraq, agriculture is
the second largest contributor to the country's gross domestic product
and employs 25 percent of the labor force, making it the largest
employer in Iraq.

USDA provides expertise in agricultural policy and development in these
two countries. We coordinate our efforts with and through an interagency
process that includes, among others, the U.S. Department of State, the
U.S. Department of Defense (DOD), and USAID. Again, we draw from a full
range of resources both here in the United States and as much as
possible in-country to facilitate technical assistance, exchanges, and
university extension programs to demonstrate sound agricultural and
regulatory practices.

Our most notable role has been through USDA employees, who have
volunteered as advisors on Provincial Reconstruction Teams (PRT), which
typically consist of military units of 50-100 personnel with two to
three civilian U.S. government advisors. PRT activities include soil and
water conservation, irrigation and water management, grain and seed
storage, post-harvest loss reduction, market system development, and
livestock health, nutrition, and breeding. Since 2003 and 2006,
respectively, USDA has deployed 48 volunteers to Afghanistan and 20 to
Iraq from nine different USDA agencies, including the Agricultural
Marketing Service; Animal and Plant Health Inspection Service;
Cooperative State Research, Education, and Extension Service; Farm
Service Agency; FSIS; FAS; Forest Service; Natural Resources
Conservation Service (NRCS); and Rural Development. Of these agencies,
NRCS has provided the most employees.

The Administration\'s fiscal year 2009 budget request includes \$12.5
million in the Office of the Secretary to help support the costs of
participating in these activities in both Iraq and Afghanistan.
Agricultural reconstruction and development are crucial for establishing
stability in both of these countries, and USDA needs dedicated funding
to have the resources needed for its staff to play an effective role in
achieving that goal.

**HIGH FOOD PRICES**

High commodity costs, combined with increased transportation costs, have
tightened the amount of food aid that can be provided under limited
program budgets, but we have taken innovative and bold steps to ensure
critical needs are met.

About a year ago, we announced that USDA would exchange government-owned
commodities for further processed products to be distributed through
USDA domestic and international food assistance programs. We call this
new initiative "Stocks-for-Food." The government-owned commodities were
acquired through forfeitures of marketing assistance loans to farmers,
and include wheat, corn, soybeans, cotton, peanuts, and rice.

Stocks-for-Food is providing approximately \$120 million in funds, with
\$100 million going toward The Emergency Food Assistance Program---one
of our domestic food aid programs---and more than \$20 million to
benefit over 650,000 children and mothers in several low-income
countries through the McGovern-Dole Program.

The issue of high food prices has received the attention of the world
food aid community as well as world leaders. In response, President Bush
directed USDA to draw down the Bill Emerson Humanitarian Trust, which
made \$200 million of total assistance immediately available through the
P.L. 480 Title II Program to address the impact of rising commodity
prices on U.S. emergency food aid programs, using the funds to meet
unanticipated food aid needs in Africa and elsewhere.

We greatly appreciate the work between the Administration and Congress
to provide \$850 million in supplemental appropriations for P.L. 480
Title II Program food aid in fiscal year 2008 and \$395 million in
additional funds to support the Title II program in fiscal year 2009 to
address the most immediate needs and alleviate systemic problems.

At the High-Level Conference on World Food Security in Rome last month,
Agriculture Secretary Schafer laid out the United States' integrated,
three-pronged strategy to combat rising food prices. First, the United
States will target countries made vulnerable by rising food prices.
Second, we will provide development assistance to countries capable of
rapidly increasing staple food production. And third, we will support
trade liberalization and increasing the use of advanced agricultural
technologies.

The United States encourages other governments to conclude an ambitious
agreement in the Doha Development Agenda of the World Trade Organization
this year that increases market access for agricultural products and
reduces trade-distorting subsidies; lifts restrictions on agricultural
exports; and expands research, promotes science-based regulations, and
encourages the adoption of innovative technologies, including
biotechnology.

**CONCLUSION**

While we will continue to deal with a variety of food assistance
challenges in the years ahead, together we will remain focused on our
primary goal---to ensure that the food needs of the poor and the hungry
are met.

This concludes my statement. I look forward to answering any questions
you may have. Thank you.

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