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THE INTERNATIONAL FUND FOR AGRICULTURAL

DEVELOPMENT (IFAD) AND THE IMPORTANCE OF

AGRICULTURE DEVELOPMENT IN SUSTAINABLE

GLOBAL POVERTY REDUCTION

HEARING

BEFORE THE

SUBCOMMITTEE ON 

DOMESTIC AND INTERNATIONAL 

MONETARY POLICY, TRADE, AND TECHNOLOGY

OF THE

COMMITTEE ON FINANCIAL SERVICES

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

SEPTEMBER 12, 2006

Printed for the use of the Committee on Financial Services

Serial No. 109–118

(

(II)

HOUSE COMMITTEE ON FINANCIAL SERVICES 

MICHAEL G. OXLEY, Ohio, Chairman

JAMES A. LEACH, Iowa 

RICHARD H. BAKER, Louisiana 

DEBORAH PRYCE, Ohio 

SPENCER BACHUS, Alabama 

MICHAEL N. CASTLE, Delaware 

EDWARD R. ROYCE, California 

FRANK D. LUCAS, Oklahoma 

ROBERT W. NEY, Ohio 

SUE W. KELLY, New York, Vice Chair 

RON PAUL, Texas 

PAUL E. GILLMOR, Ohio 

JIM RYUN, Kansas 

STEVEN C. LATOURETTE, Ohio 

DONALD A. MANZULLO, Illinois 

WALTER B. JONES, JR., North Carolina 

JUDY BIGGERT, Illinois 

CHRISTOPHER SHAYS, Connecticut 

VITO FOSSELLA, New York 

GARY G. MILLER, California 

PATRICK J. TIBERI, Ohio 

MARK R. KENNEDY, Minnesota 

TOM FEENEY, Florida 

JEB HENSARLING, Texas 

SCOTT GARRETT, New Jersey 

GINNY BROWN-WAITE, Florida 

J. GRESHAM BARRETT, South Carolina 

KATHERINE HARRIS, Florida 

RICK RENZI, Arizona 

JIM GERLACH, Pennsylvania 

STEVAN PEARCE, New Mexico 

RANDY NEUGEBAUER, Texas 

TOM PRICE, Georgia 

MICHAEL G. FITZPATRICK, Pennsylvania 

GEOFF DAVIS, Kentucky 

PATRICK T. MCHENRY, North Carolina 

CAMPBELL, JOHN, California 

BARNEY FRANK, Massachusetts 

PAUL E. KANJORSKI, Pennsylvania 

MAXINE WATERS, California 

CAROLYN B. MALONEY, New York 

LUIS V. GUTIERREZ, Illinois 

NYDIA M. VELA ́ ZQUEZ, New York 

MELVIN L. WATT, North Carolina 

GARY L. ACKERMAN, New York 

DARLENE HOOLEY, Oregon 

JULIA CARSON, Indiana 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

BARBARA LEE, California 

DENNIS MOORE, Kansas 

MICHAEL E. CAPUANO, Massachusetts 

HAROLD E. FORD, JR., Tennessee 

RUBE ́ N HINOJOSA, Texas 

JOSEPH CROWLEY, New York 

WM. LACY CLAY, Missouri 

STEVE ISRAEL, New York 

CAROLYN MCCARTHY, New York 

JOE BACA, California 

JIM MATHESON, Utah 

STEPHEN F. LYNCH, Massachusetts 

BRAD MILLER, North Carolina 

DAVID SCOTT, Georgia 

ARTUR DAVIS, Alabama 

AL GREEN, Texas 

EMANUEL CLEAVER, Missouri 

MELISSA L. BEAN, Illinois 

DEBBIE WASSERMAN SCHULTZ, Florida 

GWEN MOORE, Wisconsin, 

BERNARD SANDERS, Vermont

Robert U. Foster, III, Staff Director 

(III)

SUBCOMMITTEE ON DOMESTIC AND INTERNATIONAL MONETARY POLICY, TRADE, AND

TECHNOLOGY

DEBORAH PRYCE, Ohio, Chair

JUDY BIGGERT, Illinois, Vice Chair 

JAMES A. LEACH, Iowa 

MICHAEL N. CASTLE, Delaware 

FRANK D. LUCAS, Oklahoma 

RON PAUL, Texas 

STEVEN C. LATOURETTE, Ohio 

DONALD A. MANZULLO, Illinois 

MARK R. KENNEDY, Minnesota 

KATHERINE HARRIS, Florida 

JIM GERLACH, Pennsylvania 

RANDY NEUGEBAUER, Texas 

TOM PRICE, Georgia 

PATRICK T. MCHENRY, North Carolina 

MICHAEL G. OXLEY, Ohio 

CAROLYN B. MALONEY, New York 

BERNARD SANDERS, Vermont 

MELVIN L. WATT, North Carolina 

MAXINE WATERS, California 

BARBARA LEE, California 

PAUL E. KANJORSKI, Pennsylvania 

BRAD SHERMAN, California 

LUIS V. GUTIERREZ, Illinois 

MELISSA L. BEAN, Illinois 

DEBBIE WASSERMAN SCHULTZ, Florida 

GWEN MOORE, Wisconsin 

JOSEPH CROWLEY, New York 

BARNEY FRANK, Massachusetts 

(V)

C O N T E N T S 

Page 

Hearing held on: 

September 12, 2006 .......................................................................................... 1

Appendix: 

September 12, 2006 .......................................................................................... 21

WITNESSES 

TUESDAY, SEPTEMBER 12, 2006

Beckmann, Rev. David, President, Bread for the World ...................................... 4

Howard, Julie, Executive Director, Partnership to Cut Hunger and Poverty 

in Africa and co-author of Investing in Africa’s Future: U.S. Agricultural 

Development Assistance for Sub-Saharan Africa .............................................. 6

Lowther, Kevin G., Regional Director for Southern Africa, Africare .................. 9

McNamer, Bruce, President and CEO, TechnoServe, Inc. ................................... 11

APPENDIX 

Prepared statements: 

Waters, Hon. Maxine ........................................................................................ 22

Beckmann, Rev. David ..................................................................................... 27

Howard, Julie .................................................................................................... 34

Lowther, Kevin G. ............................................................................................ 41

McNamer, Bruce ............................................................................................... 45

(1)

THE INTERNATIONAL FUND FOR 

AGRICULTURAL DEVELOPMENT (IFAD) 

AND THE IMPORTANCE OF AGRICULTURE 

DEVELOPMENT IN SUSTAINABLE 

GLOBAL POVERTY REDUCTION 

Tuesday, September 12, 2006

U.S. HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON DOMESTIC AND

INTERNATIONAL MONETARY POLICY, TRADE, AND TECHNOLOGY, COMMITTEE ON FINANCIAL SERVICES, Washington, D.C. 

The subcommittee met, pursuant to notice, at 2 p.m., in room 

2128, Rayburn House Office Building, Hon. Frank D. Lucas, presiding. 

Present: Representatives Lucas, Watt, and Frank. 

Mr. LUCAS. This hearing of the Subcommittee on Domestic and 

International Monetary Policy, Trade, and Technology will come to 

order. I am pleased to chair today’s hearing that will examine the 

efforts of the International Fund for Agricultural Development, 

IFAD. 

The United States has been the largest contributor to IFAD. In 

December of 2005, the United States announced a pledge of $54 

million to IFAD’s seventh replenishment, which maintains approximately the same level of burden sharing as it did in the previous 

replenishment. As chairman of the Subcommittee on Conservation, 

Credit, Rule Development, and Research of the Committee on Agriculture, and as a member of the Committee on Financial Services, 

I have a particular interest in hearing how IFAD works to complement efforts made by governments, donors, nongovernmental organizations, and other partners, such as members of the private 

sector, involved with capital markets, additional U.N. agencies, the 

World Bank, and research institutions in helping to finance cultural development projects for the primary purpose of producing 

food in developing countries, which, in turn, leads to greater services and a stronger economy. 

I have always been struck by the fact that food insecurity and 

famine are not so much the result of failures in food production but 

structural problems related to poverty. I am also amazed by the 

fact that nearly 75 percent of the poor in developing countries, 

about 900 million people, are concentrated in the rural areas. IFAD 

believes, as I do, that the rural poor must be empowered to lead 

their own development. These people must be able to develop and 

2

strengthen their local organizations and have a say in the decisions 

and policies that affect their lives. 

It is for this reason that IFAD is so important. IFAD works on 

the local level to create projects that will end the cycle of poverty. 

By working closely with governments to develop and finance programs, IFAD is expected to help more than 100 million rural people living in poverty. 

Unfortunately, due to U.N. regulations, we are not able to have 

representatives from IFAD testify before the committee today. 

However, I am pleased that we will have various organizations who 

work directly with IFAD and their partners who will be able to 

give us a close-up view of how IFAD operates. 

I am also pleased to hear testimony that will address the 

progress made by IFAD and other organizations that seek to aid 

Africa in its development, the kind of commitments and future cooperation that would be necessary for continued progress and suggestions for making IFAD more effective. 

And with that I would like to turn to the ranking member of the 

full committee, Mr. Frank. 

Mr. FRANK. Thank you, Mr. Chairman. 

This is a hearing we have not because there are problems, which 

sometimes we have, but really, I think, to show our support for this 

important operation. 

As many of you understand, it is election season. There won’t be 

votes until 6:30, so it is a time when there are not a lot of members 

around, but that is not an indication of there not being support. 

Not a lot of media either, but, as you know, interest around here 

tends to be generated by controversy, not by substance. And the 

lack of controversy, for which you can, to some extent take credit, 

because of the work you have done with IFAD, means that we don’t 

have a lot of attention. But I am glad that you are here. 

Let me say, I read over the statements and I am very much in 

agreement about what we should do. At least one of you said, in 

the testimony that I read, that Congress should avoid earmarking 

some of the assistance that we give. And I agree with that. Earmarks here, we should be clear, are not earmarks of the sort of 

company of A or company B, but they are policy related earmarks: 

Put in water, put in this, put in that. 

I will tell you this. I can’t think of an earmark that was generated by a Member of Congress. Earmarks come in response to 

well-meaning organizations that say, oh, well, this is important or 

that is important. So I would say two things. One, to those of you 

who agreed that we shouldn’t earmark, never ask us to; and, secondly, help us resist. Because often what happens is a very good 

organization of decent, hard-working people comes and says, this 

area of activity is important. And an earmark is then considered 

to be, well, do you think that is a good activity or not, rather than 

should you restrict the flexibility and prefer this activity over other 

good ones. So I agree with that, but we are going to need your help 

in doing it. 

And it may mean even—and this is, I noticed—I don’t mean to 

single you out. People are always coming to us asking us to do 

things; and then I sometimes say, yes, but to do that we have to 

do the following. And they say, oh, well, that is controversial; we 

3

can’t take that position. That is, if you want to help us block earmarks, oppose the earmarks of some of your well-meaning colleagues, because otherwise they will go through unopposed. 

Beyond that, I did want to say, as I read the testimony, that I 

agree that you have pointed out one of the enduring inconsistencies 

in American politics. That is American politics is, to a very great 

extent, today dominated by people who are generally conservative 

and who preach to others the values of the free market and the virtues of nongovernment intervention. But, as I have said before, apparently in all the great free market texts there is a secret footnote 

that says, oh, by the way, not agriculture. So that when my conservative colleagues talk about the importance of keeping the government out of the private sector, about self-reliance, about the 

dangers of tax subsidy, about protecting efficiencies, etc., they have 

taken this mental reservation that it doesn’t apply to agriculture. 

Because agriculture in America is the most subsidized, regulated 

industry that we have. 

For instance, we are sometimes told, well, we need that for the 

food supply. But I know that a couple of you mentioned that one 

of the problems that African countries encounter in their efforts to 

become economically advanced is the American subsidy of cotton 

which keeps African countries which could grow high-quality cotton 

more cheaply than us from putting it on the market. And when we 

raise the issue of these kinds of subsidies we are told, well, but 

what about food supply? I have not observed people eating much 

cotton. Maybe my experiences are too limited. But the cotton area 

is an example of an American policy of subsidy which has no basis, 

obviously, in food. 

What particularly concerns me is that when some of us who have 

represented industrial areas have raised concern about the shortterm impact of foreign trade, we are told that we are being protectionist and insensitive to poor people. And of course, as the collapse 

of the Doha Round just showed, the single greatest obstacle to 

progress in world trade and to alleviating poverty internationally 

in this regard is American agriculture policy. 

Well, I take it back. We are not the single greatest. The single 

greatest is European agriculture policy. We may be tied for second 

with Japan, and the fact is that it is time to introduce agriculture 

in America to the joys of the free market which its Congressional 

representatives so freely argue for. 

I have one last point along those lines. I agreed with the Bush 

Administration, particularly with Andrew Natsios with whom I had 

served in the Massachusetts House 30 years ago, that we should 

allow more of the food aid to be money, which would buy food on 

the spot. The insistence that all food aid be physically transported, 

I think, greatly lessens its value. A significant amount of it should 

be grown and transported, and that is only sensible, and it is political reality. But we are too restrictive in allowing some of it to be 

the money equivalent. 

So I thank you for the work you do, for your support of IFAD, 

and for the policy points that you have made. 

Mr. LUCAS. And the Chair thanks the ranking member and offers 

up to the panel an observation of all the fun and challenges that 

4

the 2007 farm bill will be next year as we work our way through 

that. 

With that, let’s note for the record that, without objection, all 

members who may want to submit an opening statement will have 

that made a part of the record. 

Now, let’s turn to the introduction of our panel. 

Reverend David Beckmann is president of Bread for the World. 

Bread for the World is most famous for working closely with rock 

star Bono and is a nationwide Christian movement that seeks justice for the world’s hungry people by engaging in research and education on policies related to hunger and development. 

Also, Dr. Julie Howard is the executive director for the Partnership to Cut Hunger and Poverty in Africa, where she works to reverse the persistent hunger and poverty in Africa. She has also coauthored the comprehensive agricultural report on Africa entitled: 

Investing in Africa’s Future: U.S. Agricultural Development Assistance for Sub-Saharan Africa, with Michael Taylor. 

We also have Mr. Keith Lowther. He is the regional director for 

southern Africa at Africare, an organization that works in partnership with African communities to achieve healthy and productive 

societies. 

And, also, Mr. Bruce McNamer is the president and CEO of 

TechnoServe. TechnoServe is a nonprofit organization that focuses 

on economic development of Africa and Latin America. Its mission 

is to help entrepreneurial men and women in poor rural areas of 

the developing world. 

With that, you may begin whenever you are ready, Reverend 

Beckmann. 

STATEMENT OF REVEREND DAVID BECKMANN, PRESIDENT, 

BREAD FOR THE WORLD 

Rev. BECKMANN. Thank you, Mr. Chairman, and Mr. Ranking 

Member. I really appreciate you holding this hearing. 

The world, in fact, is making progress against poverty and hunger, and the work that IFAD has done over the last 30-some years 

is part of that progress. The attention that this committee is giving 

to that good work is part of that progress, so thank you. 

At Bread for the World, in addition to doing research, we organize people and churches to lobby Congress. We mobilize about a 

quarter of a million letters to Congress every year on issues that 

are important to hungry and poor people in our own country and 

around the world. We think agriculture and rural development are 

really important to progress against poverty around the world, also 

progress against poverty in our own country, and we have come to 

love IFAD. 

Almost 80 percent of the world’s poor live in rural areas, but only 

8 percent of development assistance goes to agriculture and rural 

development; this just doesn’t make sense. 

Compared to 10 years ago, USAID and the World Bank are talking a lot more now about agriculture, again. But there has been 

very little, if any, change in levels of funding for agriculture and 

rural development. 

The most encouraging recent development is that the Millennium 

Challenge Account is including agriculture and rural development 

5

in most of its compacts. And it is really instructive that when the 

MCA picks countries, poor countries, that have good governments, 

those countries overwhelmingly are coming back and saying they 

want help with agriculture and rural development. 

We think that IFAD is an excellent vehicle for U.S. investment 

in agriculture and rural development. Bread for the World was 

founded about the same time as IFAD, and we have monitored 

IFAD since its inception. We follow its policies, our staff visits its 

programs and projects, and we are impressed. 

In particular, we are impressed by two of IFAD’s policies. One 

is a resolute focus on the rural poor. Most of our foreign aid money 

has two or three different objectives for every dollar that we spend. 

We are trying to contribute to U.S. security and help some interest 

group in this country and also help poor people around the world, 

and so it is not surprising sometimes that the objective of reducing 

poverty doesn’t get carried out very effectively. IFAD is resolutely 

focused on helping poor people in rural areas get ahead. 

The other policy that we think has been critical to its success is 

that it tries to involve those poor communities in decisions so they 

are not just the object of investment but, rather, IFAD makes real 

efforts to empower groups of farmers, women’s groups, and other 

groups in rural areas so that they can take part in the design of 

the interventions. That means that those interventions are more 

likely to be effective, more likely to be successful, and they are 

more likely to last after IFAD finally concludes its involvement in 

the area. 

So let me conclude with four recommendations. Two are directly 

under the jurisdiction of this subcommittee. 

First, Bread for the World encourages you to enthusiastically 

support IFAD and, specifically, to support its policies of resolute 

focus on the rural poor and empowerment of the rural poor. 

Second, we would encourage this committee to encourage other 

official development banks to increase their investment in agriculture and rural development and, specifically, to focus on poverty 

and the empowerment of poor communities. 

Third—and this is a more general recommendation—we are 

thrilled that Congress and the President have been increasing 

funding for poverty focused development assistance. It is really remarkable. In 1999, the programs and agencies that we considered 

poverty focused development assistance were funded at a level of 

about $4 billion. That is up to $10.6 billion for this year, this fiscal 

year. The President has requested a $2 billion increase, but the 

House has so far approved only $1 billion of that increase that the 

President asked for. So our third recommendation is that you participate in getting the final number up to the President’s recommendation for poverty focused development assistance generally. 

And then, fourth, I do want to address the issue of agricultural 

protectionism. It is a very difficult issue. But the agricultural protectionism of the industrialized countries, first, it is tough. It is not 

good for our own agriculture. Our own agriculture becomes unresponsive. It is not meeting the needs of small-scale farmers and 

other poor people in rural Oklahoma. It is not easy to solve this 

problem. 

6

But the current structure of global agriculture is really tough on 

farmers in poor countries, and, in the long haul, nothing is more 

important to U.S. farmers than the expansion of markets in developing countries. When people in East Asia were able to get out of 

poverty and hunger to some extent, that was good for agriculture 

in Oklahoma. And it is that positive interaction between agriculture and rural development among the poor around the world 

and agricultural and industrial development in our own country 

that we should be fostering. When really poor people get ahead a 

little bit, the extra dollar they get, 80 percent of it goes into food. 

So some of that will go into imported food and agricultural imports. 

So addressing the concerns that Mr. Frank addressed is a big 

task for Doha. We hope the President will rescue Doha, and we 

hope the next foreign bill will find some ways to make progress in 

changing the structure of global agriculture. 

Thank you very much. 

[The prepared statement of Rev. Beckmann can be found on page 

27 of the appendix.] 

Mr. LUCAS. Thank you. 

Dr. Howard. 

STATEMENT OF JULIE HOWARD, EXECUTIVE DIRECTOR, 

PARTNERSHIP TO CUT HUNGER AND POVERTY IN AFRICA 

AND CO-AUTHOR OF INVESTING IN AFRICA’S FUTURE: U.S. 

AGRICULTURAL DEVELOPMENT ASSISTANCE FOR SUB-SAHARAN AFRICA 

Ms. HOWARD. Mr. Chairman, thank you very much for this opportunity to testify about the importance of U.S. support for African agriculture in general, and for IFAD in particular. 

I represent the Partnership to Cut Hunger and Poverty in Africa, 

which was founded in 2001 by African Union Commission Chair 

Alpha Konare and former USAID Administrator Peter McPherson; 

the Presidents of Uganda, Ghana, and Mozambique; former Congressman Lee Hamilton; Senator Robert Dole; and Reverend David 

Beckmann, to my side. 

The Partnership is an independent U.S.-African coalition of public and private organizations advocating for greater and more effective investment in Africa’s agricultural and rural sectors. 

I would like to make six key points today. 

The first one is that agriculture is pivotal in the fight against 

hunger and poverty in Africa. As you know, poverty and hunger 

are acute in sub-Saharan Africa and conditions are worsening. 

Nearly half of the population there gets by on less than a dollar 

a day, and a third go hungry. 

Over the past few years, these tough realities have triggered a 

global recommitment to eradicate poverty and hunger. We see this 

reflected in the 1996 World Food Summit to halve the number of 

undernourished people by 2015, and this is reinforced by the 

United Nations Millennium Development Goals. This global consensus recognizes both the moral imperative of addressing these inequalities and also the self-interest of rich countries to do so. 

Historically, agriculture has provided the foundation for economic take-off in almost every single country of the world. In Africa, 70 percent of the population lives and works in rural areas. So 

7

if you want to have a major impact on poverty and hunger, there 

is really no other way and no better way to do this than by rapidly 

growing the rural economy. 

My second point is that agricultural assistance to Africa is going 

to require broad and costly interventions. In Africa, the development challenge is more difficult and more complex than elsewhere 

in the world. Historically, during the Green Revolution in the 

1960’s in Asia and Latin America, a lot was achieved through improvements at the farm level just by providing improved seeds, fertilizer, research, and extension services for small-scale farmers. 

But sub-Saharan Africa lacks much of the physical infrastructure, the roads, the ports, and the institutional capacity for research, governance, and functioning markets that made the Green 

Revolution possible for these other regions. Thus, for Africa, it is 

really important for us to reframe our thinking about agricultural 

development assistance. 

So we are not just thinking about farm-level improvements, but 

we are actually including a much broader range of activities to help 

foster this agriculture-led economic growth. These improvements 

range from natural resources management and improved farm productivity all the way to assistance for market development, rural 

roads, and improving trade policy. 

My third point, considering the issues that we have been discussing today, of the three Rome-based United Nations agencies, 

IFAD focuses exactly on this critical role of agriculture in facilitating broad-based economic growth for the rural poor. IFAD 

projects generate growth by integrating smallholders into markets, 

developing rural financial systems, improving land and water management and improving knowledge, information, and technology 

systems for the rural poor. It has important field experience, and 

on the basis of this field experience, IFAD is becoming an increasingly important voice at the policy level, arguing for market-led agricultural development. And, as Reverend Beckmann noted, IFAD 

also is facilitating the participation of the rural poor themselves in 

policy formulation and project implementation. 

Mr. Chairman, support for IFAD is one of a number of ways that 

the United States supports African agricultural development. 

About 80 percent of U.S. funding for African agriculture is provided 

directly through U.S. agencies. USAID is the lead, also USDA, African Development Foundation, and now the MCC. It is just the remaining 20 percent of funding that is filtered through the multilateral agencies, including IFAD, the United Nations FAO, World 

Food Program, World Bank IDA, and the African Development 

Fund of the African Development Bank. 

My fourth point is, given the critical importance of getting rural 

economies in Africa going, the United States is significantly underinvesting in African economic growth relative to spending for social 

programs. 

The Partnership documented actual U.S. spending on African agricultural development in a report we released one year ago, ‘‘Investing in Africa’s Future: U.S. Agricultural Development Assistance for Sub-Saharan Africa.’’ We found that although U.S. leaders 

are embracing agriculture-led economic growth at the policy level, 

the financial support, in truth, is actually lagging. It has stagnated 

8

since 2000. So total U.S. agricultural development assistance for 

Africa between 2000 and 2004 grew by only 2 percent in real 

terms. And if you compare this to what has happened with health 

programs and education programs, USAID health programs in Africa grew by 61 percent in the same time period; and this increase 

doesn’t even include what we are spending on HIV/AIDS in the 

global fund to fight AIDS, tuberculosis, and malaria. The HIV/

AIDS commitment itself is for $15 billion over 5 years. 

Furthermore, the effectiveness of U.S. assistance is limited by 

earmarks, by fragmentation across agencies, and by a lack of coordination. Some of these challenges indeed could be eased if the 

Millennium Challenge Corporation fulfills its considerable potential. The MCC operates under a different framework, and it receives funds that are not earmarked, at least not thus far. 

Our experience of MCA indicates when countries are allowed to 

choose assistance priorities for themselves, they go ahead and 

choose to fund programs that do stimulate broad-based economic 

growth. The three MCA compacts signed in Africa thus far, Madagascar, Ghana, and Benin, all have significant agriculture components. But MCA remains largely untested as a vehicle for development assistance, and it really focuses on a very limited number of 

countries. 

Fifth, beyond the U.S., OECD development assistance reflects 

the same imbalance: great concentration on social spending, very 

little actually on economic growth. I think this puts into question 

whether we are going to be able to achieve the sustained progress 

on poverty and hunger that we want and need. 

While overall bilateral assistance from OECD countries grew by 

74 percent between 2000 and 2003, the share of agriculture-related 

assistance in ODA actually declined from 13 to 9 percent. By contrast, in this same period, health-related bilateral ODA grew by 

115 percent and ODA for education increased by 77 percent. It has 

a spill-on effect in Africa, because African political leaders, while 

they also put high priority on rural economic growth and on the 

place of agriculture in their economies, they can’t do this with their 

own domestic resources. They rely on the resources they receive 

from bilateral and multilateral donors. And if those are pre-selected for social projects, then the actual budget allocation is strong 

on social spending and weak on economic growth. 

My final point is that the United States should take the lead 

with IFAD in urging significant increases in funding for economic 

growth, for facilitating agriculture-led economic growth in Africa. 

While increased expenditures for health and education are important, the current ratio of investment by the U.S. OECD will not 

enable African countries to sustain their health and education systems over the long term. Food, health, and education are all high 

priorities and very interdependent. Without adequate food, people 

will never be healthy and children will not be prepared to learn. 

And without growing their rural economies, African nations will always be reliant on external assistance. 

Thank you for this opportunity. 

Mr. LUCAS. Thank you. 

[The prepared statement of Ms. Howard can be found on page 34 

of the appendix.] 

9

Mr. LUCAS. Mr. Lowther. 

STATEMENT OF KEVIN G. LOWTHER, REGIONAL DIRECTOR 

FOR SOUTHERN AFRICA, AFRICARE 

Mr. LOWTHER. Thank you, Mr. Chairman. I am going to beg your 

indulgence and try to focus a bit on the field perspective. 

I have had a working relationship with IFAD for the past 20 

years, and I think everything you are going to hear today is simply 

going to underscore my own experiences there. But what I want to 

bring out in this testimony is a perspective from the farmers themselves and, in this case in particular, Zimbabwe. So the overall context of my testimony is going to be southern Africa. 

Having lived or worked there for the past 28 years, I have had 

the opportunity to observe several trends as they evolved over an 

entire generation. When I went to live in Zambia in 1978, southern 

Africa was locked in several armed liberation struggles and confronting apartheid in South Africa. HIV/AIDS was still unknown, 

and the region was essentially food secure. Today, apartheid is history, and there is peace throughout. HIV/AIDS has emerged as a 

modern-day plague, but the most surprising change, to me at least, 

in southern Africa is that the region is now chronically food insecure. 

If southern Africa was feeding itself a generation ago, what has 

happened that requires the World Food Program, USAID, and 

other agencies annually to provide thousands of tons of food to sustain millions of people? The short answer is the maize trap. Now 

for decades, smallholder farmers in southern Africa have relied almost exclusively on maize as their staple. Colonial and post-colonial governments alike promoted this dependence for reasons of 

their own, but not because maize was the best agronomic choice to 

ensure long-term food security. 

The trouble with maize is that it is not a particularly nutritious 

crop. It exhausts the soil, and it requires reliable rainfall. This 

would not be a problem if there were an endless supply of fresh 

land and cheap fertilizer. It would not be a problem if rainfall in 

much of southern Africa were still reliable, which it is not. Farmers 

continue trying to grow maize on soil that is increasingly infertile, 

and the decline of those rainfall patterns have become notoriously 

fickle. 

A more recent factor is HIV/AIDS, which is decimating families’ 

capacity to cultivate their land. But the core reality is that farmers 

in southern Africa are trapped in a vicious cycle. The more they 

cling to maize, the more food insecure they become. Even in relatively good rainfall years few are able to produce enough maize 

to feed their families. The region is basically in a death spiral in 

terms of food security. 

Along with dependence on maize has come a collateral myth that 

southern African farmers are unwilling to adopt new crops and 

technologies. Africare’s experience in the SADC region shows the 

contrary, and perhaps the most instructive lessons have been 

learned in the drought-prone Midlands Province of Zimbabwe. 

Africare decided to ask what the farmers of Midlands Province 

thought. We first organized a series of farmer demonstrations. 

Residents were introduced to simple, affordable technologies for 

10

processing more drought-tolerant crops. These include sunflowers 

processed into edible oil, and soybeans converted into a variety of 

tasty and nutritious products. Farmers also began to appreciate 

what they could do with improved varieties of cassava, with more 

drought-tolerant crops like pigeon peas, and with leaves, as well as 

the flesh of cassava and sweet potatoes. They found that all of 

these crops could be integrated into their farming systems and that 

soybeans in particular restored soil fertility by fixing nitrogen. Because they could process these crops themselves, mainly for consumption, they did not have to worry about selling to some distant 

market. Their diets were enriched, and their immune systems 

strengthened. When communities elsewhere continued to suffer 

through drought, our Midlands farmers did not. 

Who funded this innovative program? IFAD, which provided 

Africare with modest grants to support crop diversification and village-based food processing. As a result, we have a proven farmerdriven model which has liberated, in this case, more than 4,000 

people in several wards of Midlands Province from the ‘‘maize 

trap.’’ This is the kind of breakthrough programming which IFAD 

was intended to nourish. 

IFAD had the flexibility to invest in a couple of $100,000 grants 

in the Midlands farmers to see what might happen. But IFAD’s 

policies and procedures do not allow it to expand this program 

more broadly in Zimbabwe unless it does so through a loan to the 

government. IFAD is not presently able to consider new loans to 

the Zimbabwe government, and even if it were, we would have to 

hope that the Ministry of Agriculture would be prepared to embark 

on a national campaign to de-emphasize maize in favor of more nutritious, drought-tolerant, and soil-friendly crops. 

The farmers in Midlands Province and elsewhere in the region 

have demonstrated that they are willing to diversify away from 

maize if they know that they can process and utilize these alternative crops. Within a decade, the face of smallholder agriculture 

could be changed dramatically if those agencies most concerned 

with food security and poverty were able to join forces to make it 

happen. 

It was the Rockefeller Foundation which got Africare to begin focusing on soybeans, mainly as a means to strengthen soil fertility. 

The work has been very successful in a limited geographical area, 

but the foundation is not prepared by itself to replicate this 

throughout the region. The Bill and Melinda Gates Foundation is 

funding Africare in another part of Midlands Province to test crop 

diversification, but again on a limited scale. And, meanwhile, our 

IFAD-funded work in Zimbabwe is coming to an end. Very sad 

news for the farmers, I can tell you. 

IFAD, I think, has a leadership role to play here. IFAD has the 

broad understanding of agriculture and its centrality in addressing 

poverty in regions such as southern Africa. It should have a clear 

and documented awareness of what works and what doesn’t at the 

community level. It does not have the mandate or resources to restore sustainable food security in southern Africa. But it does have 

the credibility to lobby governments, its fellow United Nations 

agencies, and major donors, to launch a coordinated effort to end 

11

southern Africa’s dependence on a crop, maize, that is steadily aggravating food insecurity. 

It is sad to say that Africare’s largest funder in Zimbabwe is not 

IFAD, not the Rockefeller Foundation, nor the Gates Foundation. 

It is the World Food Program, which contracts Africare and other 

NGOs to deliver food—grown far, far away—to vulnerable groups. 

There is something very wrong with this picture. We know what 

can be done to achieve sustainable food security throughout southern Africa. Emergency food aid is not the answer. It is a Band-Aid, 

at best and, at worst, a crutch which will allow us to believe that 

all will be well in the long run and no one will starve. 

Mr. Chairman, I will end there and, again, apologize for my voice 

and for my uncongressional garb, but there is a reason for that. 

And I will be happy to answer your questions later. Thank you. 

Mr. LUCAS. Thank you. 

[The prepared statement of Mr. Lowther can be found on page 

41 of the appendix.] 

Mr. LUCAS. Mr. McNamer. 

STATEMENT OF BRUCE McNAMER, PRESIDENT AND CEO, 

TECHNOSERVE, INC. 

Mr. MCNAMER. Mr. Chairman, Ranking Member and members of 

the committee, first, thank you for the opportunity to testify before 

you today and to offer a strong voice in support of the International 

Fund for Agricultural Development and its unique role in creating 

economic opportunity and hope for the world’s rural poor. That, too, 

is TechnoServe’s work and has been since we were founded 40 

years ago by a Connecticut entrepreneur named Ed Bullard who 

sought himself to apply private-sector solutions and business-based 

approaches to alleviating poverty in the developing world. 

Since then, we at TechnoServe have evolved to focus on building 

thriving businesses and industries as catalysts for poverty reducing 

economic growth in rural economies where 70 percent of the world’s 

poor reside. We base our work out of offices in 13 countries in Africa and Latin America. 

As with my own background, most of our global staff of 350 professionals is drawn from leading private-sector firms, both multinational and host county institutions. Many have run their own 

successful businesses, and this is based on our belief that the best 

people to help other entrepreneurs is business people themselves. 

Last year, we assisted generated well over $50 million in revenues, and brought local raw materials worth $30 million, benefiting 

700,000 people. In our work, we rely heavily on corporate partners—Proctor and Gamble, Kraft Foods, McKenzie, Cargill, Nestle, 

Google—and a number of public-sector partners. But quite prominent among those are USAID and IFAD. 

Mr. Chairman, with its focus squarely on rural and agricultural 

development, IFAD is an organization with a unique mandate and 

a crucially important role. Indeed, it is much like TechnoServe with 

its mission of helping the rural poor to overcome poverty. 

With U.S. and other funding for agricultural development in Africa stagnating from 2000 to 2004, IFAD’s support for agricultural 

development in the world’s poorest places is even more vital to the 

development and dissemination of sustainable improvements. Since 

12

its creation 28 years ago, IFAD has worked continually to empower 

rural producers and to emphasize and promote the role of markets, 

the development of competitive value chains, opportunities to generate non-farm income and employment, and on the vital role of access to capital in rural economies. 

While many major donors like the World Bank invest much of 

their efforts on higher-level policy and regulatory reform, or on 

large-scale infrastructure investments, IFAD stands out as the organization providing solutions to poverty targeting the rural poor 

where they live, in their communities, with hands-on practical assistance. 

I want to give you just a recent example of a partnership with 

IFAD and TechnoServe in the African Cashew Development Program. This is a 3-year regional program in East Africa, and it aims 

to work all along the cashew value chain to increase farmer productivity and incomes, and to work with entrepreneurs to build 

value-added cashew processing factories. This is instead of a traditional reliance on the export of raw commodities to enable existing 

processors to be more competitive; to support sustainable industry 

trade and marketing organizations functioning at national and regional levels; to increase regional industry competitiveness through 

a stronger, harmonized policy environment; and to improve regional relationships and synergies among cashew industry stakeholders, leading to sustained growth, competitiveness, and profitability in the sector beyond that achieved at national levels. 

IFAD’s role in our partnership is threefold: as a funder for a subset of activities, specifically around farmer productivity and policy 

improvement; as a convener of public and private regional stakeholders; and as a disseminator of best practices both into the program, bringing to bear lessons they have learned in other value 

chain work, and out of it as well, cataloging what we together are 

learning for its wider application. 

Our IFAD-supported cashew program is proof that these kinds of 

smart interventions can help. It has already resulted in 14 ruralbased cashew processors in Mozambique purchasing raw cashew 

nuts from 110,000 farmers, earning $5.1 million last year in export 

earnings and employing over 3,000 workers. 

We are working with IFAD now on replicating that success regionally. Already one new factory has been established in rural 

Kenya, industry efficiency improvements have been achieved in the 

existing factories in Kenya and Tanzania, and we have an entrepreneur who has established his first Mozambican model factory in 

Benin. 

Our partnership extends to improving the business environment. 

A policy reform effort in Tanzania contributed to the creation of 

over 1,500 jobs and $5.5 million in export earnings from processed 

cashew kernels. And for the first time the Government of Kenya is 

about to start debate on creation of a national cashew policy. 

We are gradually working ourselves out of jobs. Already, 

Mozambican processing factories have formed an association which 

has now taken over the majority of TechnoServe functions: financing, procurement, shipping and logistics, government lobbying, etc. 

Together with IFAD we look forward to moving on from the cashVerDate 0ct 09 2002 14:52 Mar 26, 2007 Jkt 031547 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 K:\DOCS\31547.TXT HFIN PsN: TERRIE
13

ew-processing industry confident that African farmers and entrepreneurs can take this business forward. 

Mr. Chairman, this is but one example of the kind of work that 

IFAD undertakes and supports every day. There are many others. 

IFAD’s focus and its particular approach are unique and effective, 

and they warrant our strong and continued support. 

Thank you. 

Mr. LUCAS. Thank you, Mr. McNamer. 

[The prepared statement of Mr. McNamer can be found on page 

45 of the appendix.] 

Mr. LUCAS. For the record, I would note, without objection, that 

the entire written statement of each of the witnesses will be made 

a part of the record. 

Mr. Lowther, you mentioned the challenges—obstacles perhaps is 

a better phrase—in Zimbabwe. Are there other obstacles that IFAD 

and organizations like yourself face in different parts of Africa of 

a similar nature? 

Mr. LOWTHER. We probably need a full hearing for this. 

Mr. LUCAS. Point understood. 

Mr. LOWTHER. I think—let me put it this way. I was giving vent 

here to some frustrations that have built up over a long period of 

time in my work in the field, and I think it is shared by farmers, 

local officials, NGO workers, and everybody who is close to the 

ground, that there is a general appreciation that the people themselves are ready to take control of their destiny. They are not sitting around waiting for things to happen. 

And I think one of the obstacles, as you put it, is the fact that 

the right people aren’t giving the right credit to that reality. So the 

farmers in Zimbabwe that I was describing, these are people who 

are not sitting around waiting for me or you or Robert Mugabe to 

do something for them. As soon as they see good ideas, they will 

run with them, and that is what has happened here. New technologies, better seeds; once it is there, they can run with it. 

I think the greatest obstacle is simply making sure that people 

on the ground have access not to a lot of money, but to information, 

to technology, and that no one gets in the way. One reason that 

our work in Zimbabwe has gone forward, thankfully, is that the 

government did not get in the way. Very often, governments do get 

in the way with wrong policies, and that goes back to the maize 

issue. As you know, maize was encouraged for all sorts of reasons, 

but very little to do with agriculture, and what grows best in the 

African environment. So I put my faith in the African farmers, Mr. 

Chairman. 

Mr. LUCAS. This is an authorizing committee, and on many of 

these issues we have to deal with the appropriators to actually cut 

the check, so to speak, and they are the proverbial bean counters, 

so to speak. How do you measure the results on the impact on your 

communities in the situations that you just mentioned, the successful project and in the particular area in Zimbabwe? Is there a 

quantitative way to analyze that for the benefit of the people we 

deal with here? 

Mr. LOWTHER. Yes, it has been analyzed. Because you can see 

how many meals a day people are eating. You can see what they 

are consuming in terms of nutritional value. 

14

As I mentioned in my testimony, these people are surviving in 

drought circumstances. They are eating at least two meals a day, 

if not three, when communities elsewhere in the same general region are in jeopardy. There are other ways of measuring this, but 

we did make that effort to document it. 

Mr. LUCAS. Mr. McNamer, you mention the businesses. How is 

the money earned by the businesses that are supported by 

TechnoServe? How does that stay in the hands of Africans? 

Mr. MCNAMER. A lot of that has to do with the fact that we are 

systematically trying to move value and value chains back closer 

to Africa and to African farmers themselves. In the instance I cited, 

in the cashew-processing instance, the entrepreneurs themselves 

are Mozambican in the first instance and East African themselves. 

We actually measure, to Mr. Lowther’s point, a lot of metrics 

with respect to the businesses and some of those include wages 

that actually are disbursed to employees in the factory. So you can 

count the number of employees, and then you can track the wages 

that are paid in the hands of employees who are themselves African. 

We track, as well, the percentage of total revenues that are paid 

to the providers of raw cashews in this instance. So as you start 

a tick-down and see those proceeds all start with a revenue number 

and say, you know, your cost of goods that is going to African farmers, your labor is being paid to African employees. Ultimately, your 

profits being kept in the pockets of African entrepreneurs. 

Mr. LUCAS. Dr. Howard, how does the micro credit micro financing help with the rural work force in these sub-Saharan areas? 

Ms. HOWARD. Providing access to financial services, I think, is 

critical to make a transition from project-oriented support to a system where, you know, once farmers, once agribusinesses begin to 

realize, well, how is it that you organize management, how do you 

organize yourself to get improved inputs, or how do you organize 

yourself to run a business—you know, that access to financial services lets them expand and gives them a window to increased profitability, expanding their business. 

So I think that is one of the key missing links that we find in 

many parts of rural Africa especially. I mean, you have project finance and then, once the project ends, people have nowhere to go 

to get financing. So making this link is tremendously important. 

Mr. LUCAS. Very good point. And as I turn to the ranking member, I would just note that in that infamous 2007 farm bill that we 

will work on next year, 36 million acres of American farmland are 

held at the CRP, held out of production. So while there are many 

effects of all nature of the farm bill, nonetheless, having that 36 

million acres out of production reduces the supply that these individuals have to compete with around the world. 

With that, the Chair wishes to turn to the ranking member of 

the full committee, Mr. Frank. 

Mr. FRANK. Thank you. 

Dr. Howard, one provincial point. When you list the African 

countries that are participating in the Millennium Challenge Account, my Cape Verdian constituents would want me to remind 

that you Cape Verde was one of the first in the first round. I don’t 

15

know if you have separated them from Africa, but they consider 

themselves a successful African example of that. 

And, Mr. Lowther, our colleague, Mr. Watt, had to go off to a 

briefing on some security matters in the Judiciary Committee, but 

he was particularly interested in your conversation, and you might 

want to follow up with him. You know, he is the current Chair of 

the Congressional Black Caucus and is particularly interested in 

the specific issue, as are all of us. 

The chairman and I sort of turned to each other. That is the first 

good news out of Zimbabwe many of us have heard. Is that going 

forward despite what would appear to be the extreme craziness of 

the President of Zimbabwe? 

Mr. LOWTHER. There are a lot of good things happening in 

Zimbabwe, and it doesn’t really surprise me. But when I go there, 

you gear up for, you know, all the bad things you know you may 

experience. And then nothing happens. And what is inspiring is 

when you are with the people in the rural areas. They are not bellyaching about all of these problems. They are looking for ways to 

deal with the day-to-day issues. And the biggest one really is feeding their families, and the other is finding health care. 

Mr. FRANK. Oh, I agree. But it is just encouraging to know that 

they are able to do that without interference. I mean, in some 

areas we have heard that. 

The one thing I would say is that—you are free to say what you 

want. I wish we were doing more in other areas, but, if I were you, 

I wouldn’t denigrate emergency aid. As a substitute for something 

else, it is a problem. But I guess the question would be, would we 

be better off, everything else being equal, if we didn’t offer it in 

emergencies? 

Mr. LOWTHER. Well, I am not denigrating it. I am simply indicating that if you add up the resources that go into emergency assistance—and I have seen billions over the last 25, 30 years go in 

that direction—that is money that is basically lost for development. 

Mr. FRANK. Okay. That is where I would differ with you. The fact 

is, nobody has set aside a pot of money to go for that. And my feeling, politically, would be that making a fight for the kinds of things 

you care for is important. But I don’t think reducing emergency aid 

would help with that. I think it just responds to different political 

impulses, and I think the result would just be less overall. 

Mr. LOWTHER. I agree with the point as you express it that way. 

But I think the point I was trying to make is that it is a lot easier 

for WFP to go out and bang the drum for people in need in 

Zimbabwe than it is for IFAD. 

Mr. FRANK. I understand that. But what I am saying is, good, 

then help IFAD. Don’t knock the WFP. And what you said could 

have been interpreted that way, and there is plenty of room for everybody here. 

Mr. LOWTHER. Well, I hope it wouldn’t be interpreted that way 

because, actually, WPF, from my standpoint— 

Mr. FRANK. I understand that, but it came across that way. You 

said it is worse than a Band-Aid. It was a crutch. Although I, 

frankly, generally think that a crutch is probably higher up than 

a Band-Aid in the hierarchy of medical supplies. In terms of, certainly, Medicare reimbursement it would be. 

16

I don’t want to overdo the point, but I think it is important. We 

are in an uphill fight to get anything for anything that is good, and 

I wouldn’t want to—but then that leads to my next question. 

What I am struck by is the disparity between the good that you 

say IFAD does and the relatively small amount of money it gets. 

Now, obviously, it is an international thing. Should we be taking 

the lead, the United States, in trying to significantly increase 

IFAD’s funding? It is in the, what, in the millions. What is it, $18 

million? Within our budget there would seem to be room to increase that. Has there been an effort? Are you all involved in an 

effort to try and increase this? 

Now, as the chairman pointed out, it is an appropriations issue 

since we have a permanent open-ended authorization here. So we 

don’t get into it within this committee except we could become advocates for it with the appropriators. 

So let me go down the list. Should we all start trying to double 

the money for IFAD? It doesn’t seem like that would have any 

great budgetary strength. Reverend Beckmann. 

Rev. BECKMANN. Yes, we do support increased funding for IFAD. 

There was a period where we were struggling just to maintain U.S. 

funding for IFAD. But among—it is a multilateral development 

bank. It is now supervised by Treasury. It is under your jurisdiction. We think—in general, we think the multilateral development 

banks do a pretty good job. But IFAD is unique in its focus on rural 

poverty and in the way it empowers poor people. So we do think 

and are arguing for increased funding for IFAD as part of the overall increase of development assistance that we are seeking. 

Mr. FRANK. Well, I am glad you said that. Because implicitly 

there was a suggestion again that you want to increase IFAD by 

taking it away from the other banks. And I mean, when you said 

doing it comparatively— 

Rev. BECKMANN. No. I agree. I didn’t mean to suggest that. 

Mr. FRANK. You caught it. Again, but particularly here, the 

amount of money is so little. As I go down—because I am assuming 

implicitly there was no capacity problem, that we could make a significant increase in the funding and they would be able to spend 

it appropriately. 

Dr. Howard. 

Ms. HOWARD. I believe that is the case. I mean, we also would 

support an increase in IFAD funding. I mean, in talking to some 

of our colleagues on the European side I believe that other bilateral 

agencies are considering ways to increase working with IFAD and 

increase budget allocations from their countries to IFAD. 

Mr. FRANK. Yes. 

Rev. BECKMANN. Just the immediate opportunity is you mention 

that you agree with the President on reform he has proposed in 

food aid. The President has also asked for a $2 billion increase in 

poverty focused development assistance, and the House has approved a $1 billion increase. I am grateful for the $1 billion. That 

extra $1 billion, a lot of that would go into the Millennium Challenge Account for agriculture and rural development. So when Congress returns after the elections and finalizes appropriations, there 

is a billion dollars for poor people that is hanging fire. It is money 

that the President has asked for and if—we hope that the final 

17

number is the President’s number and is closer to the President’s 

number than the House’s initial number. 

Mr. FRANK. And would you—because at this point I guess there 

would need to be some steps taken before they go to IFAD. But it 

would go to the MCC? 

Rev. BECKMANN. A lot of the difference would go to MCC. 

Mr. FRANK. MCC for agriculture. 

Rev. BECKMANN. Yeah. A lot of the MCC money turned out to be 

going toward agriculture. 

Mr. FRANK. Mr. Lowther, the capacity problems if you were able 

to increase the money? 

Mr. LOWTHER. Well, I would certainly increase the funding, but 

I think IFAD also has to decide what it really wants to achieve. 

I mean, we have this kind of diffuse focus right now, helping the 

rural poor. But I think the assistance is just that. It gets diffused 

in a way that we do some good things here, we do some good things 

there, but not an awful lot in between. 

And this is what I was trying to explain in the context of 

Zimbabwe. You wouldn’t need an awful lot of extra money to make 

a much broader impact in that country. But in southern Africa, as 

a whole, if you could get a consensus that crop diversification, as 

an example, needed to be promoted, you could put a price tag— 

Mr. FRANK. Let me ask, with the chairman’s indulgence, is that 

something that would primarily come from IFAD? What is the balance of power between what IFAD does and local—decisionmaking 

local governments? I mean, we have different problems. The World 

Bank will tell you sometimes, well, we would like to do this, but 

we have local resistance. I mean, how much autonomy does IFAD 

have in make the decisions about where it would spend its money? 

Mr. LOWTHER. It can be a partnership. And that is what I was 

trying to suggest, that I think IFAD has a potential role here. 

Mr. FRANK. I understand that. But I am asking you what it is. 

I mean, are you saying they should take more of the leadership? 

Should they be more—that they should be more directive? Would 

they run into resistance? Should they be pushing the governments 

more? 

I mean, I want to get beyond the level of everybody—if everybody 

was nice and everybody agreed, everything would be good. Then I 

wouldn’t have a job. I agree. But given that there are disagreements, you think, you don’t like what they are doing now. You 

think they could be doing better? How should they do that? Should 

they push the governments more? 

Mr. LOWTHER. Absolutely. 

Mr. FRANK. Should we be pushing them to do more? 

Mr. LOWTHER. They know what works. They are in a better position than most to know what works. 

Mr. FRANK. IFAD. 

Mr. LOWTHER. Yes, and they need to be more aggressive in getting that information out to the right folks. 

Mr. FRANK. Do the others agree with that? 

Yes, Dr. Howard. 

Ms. HOWARD. I just want to return to a point that you actually 

made early on about the importance of strengthening African capacity. I mean, I think at the end of the day, we are only going 

18

to make progress if we can create African capacity, African institutions so there can be strong governance and strong civil society organizations to guide investments. I mean, to some extent, we are 

seeing MCA starting to go down that road, and I think it is very 

impressive that MCA is actually turning into a learning organization, and I would commend the Congress for supporting that, to the 

extent that we should be looking to increase our investments. 

Mr. FRANK. Well, is IFAD the vehicle for doing that? I mean, we 

are here on IFAD. Should they be focusing on technical, or do you 

want them to get into this kind of capacity building as well in a 

broader sense? 

Ms. HOWARD. IFAD does focus on capacity building. I mean, they 

are building the empowering local organizations participating in 

these policy discussions—very, very important, but I just want to 

point that out as a very important principle. 

Mr. FRANK. You did. There are a lot of nice things in this world, 

but I really am interested in how we get there. 

I mean, yes, I am all for hopeful capacity. I want to know who 

should be doing what. I read that—well, let me ask, I will get to 

Mr. McNamer. I am stuck with this because to some extent when 

we hear from local groups, for instance, if we are talking about 

some of the IFI’s, there is an argument that they have been too assertive and not respectful enough of local decisions. Mr. Lowther is 

suggesting the balance might be the other way. 

There is room, not being disrespectful, but for the international 

financial institution to be more assertive. I want to know what people think about it, the whole question of more money for IFAD and 

its role. 

Mr. MCNAMER. I think we are a long way from running up 

against capacity strength, so, yes, more money for IFAD. 

There is some self-interest at work here to the extent that they 

are uniquely focused on what our organization is focused on, which 

is rural development, small holder farmers as business people. 

There are very few organizations with such a unique focus; in some 

sense it is an earmark, but it is one that we like. 

But—and I would say, moreover, that it is increasingly our sense 

that money spent with IFAD is money well spent. I think they 

have taken seriously in these last several years a mandate to think 

about themselves, organizations, both in respect to strategy and 

their focus in respect—and with respect to organizational locations. 

In my own short tenure in TechnoServe, we have seen the results 

of some of that brought to bear both in terms of processes and new 

organizational approaches and in terms of persons. 

Mr. FRANK. That is useful and I appreciate the indulgence the 

chairman is showing on the time, but we don’t usually get, frankly, 

this kind of a consensus. We didn’t set out to handpick witnesses 

who were going to be favorable. In fact, usually when you have a 

hearing, it is easy to get people and you want to come whack somebody because generally people are more motivated. 

So this is an unusual consensus and leads me to think maybe we 

should talk to the chairman and some others. Maybe we can get 

some support for higher funding, especially—and given the low 

level or relatively small amount of a few million. 

19

Let me ask my last question. Obviously, we are part of a multilateral operation there. If we were to take the lead, who are the 

other major funders? Is this the western Europeans, or where does 

the other major funding come from? 

Rev. BECKMANN. It is unique in that the developing countries 

themselves put in a substantial amount of money, especially the oil 

countries. It was started about the time when OPEC raised prices 

in the 1970’s, and so the OPEC countries, the oil countries, have 

traditionally contributed substantially. 

Mr. FRANK. This would be a useful time for the United States to 

initiate an increase going by those others. So when you say ‘‘developing countries,’’ are you talking about oil producing countries? 

Rev. BECKMANN. They were partners from the beginning, but I 

think, in general, there is more money from the developing countries that goes into IFAD, and then other institutions. 

Mr. FRANK. I appreciate that, and we will continue to work on 

what I hope are necessary changes to the American policy. But that 

is a good message to come away with. It is unusual to hear an 

international institution have this degree of support. 

Thank you, Mr. Chairman. 

Mr. LUCAS. The ranking member’s time has expired and the 

Chair would note that he will always be indulgent of the ranking 

member, until November 7th. 

With that, the Chair notes that some members may have additional questions for the panel which they may wish to submit in 

writing, and without objection, the hearing record will remain open 

for 30 days for members to submit written questions to the witnesses and to place their responses in the record. 

With that, the hearing is adjourned. 

[Whereupon, at 3:00 p.m., the hearing was adjourned.] 

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