WRITTEN QUESTION E-0338/96 by Reimer Böge (PPE) to the Commission (22 February 1996)

Subject: Shortages in global food reserves

Developments in the global food reserves are giving cause for concern. According to the food organization of the United Nations (FAO), global food reserves could fall below crisis level after a series of crop failures in several principal supplier countries in the summer of 1996.

In the 1995/1996 farming year harvests produced less than global grain consumption for the third year running. The FAO estimates that grain production in this harvest year must rise on average by at least 4% in order to meet consumption needs.

The effect of the shortages on the world market is felt especially by developing countries who rely on food imports and can scarcely pay the high prices at the moment. According to the FAO 44 countries in Africa are threatened with famine. The situation for these countries is made even more difficult by the fact that global food aid supplies for Africa have reached their lowest level in the past 20 years. The United States have cut aid drastically. The European Union itself has scarcely any reserves left since stocks have almost been completely run down.

What is the Commission's opinion on the situation and what conclusions does it draw from these developments in view of the CAP and food aid programmes?

Answer given by Mr Pinheiro on behalf of the Commission (30 April 1996)

1. In line with expectations held by major international organisations like the World Bank and the IMF, the Commission expects a continuation of the ongoing trend towards a further but very gradual decline of world market prices for agricultural commodities. Current prices for cereals have fallen from what are considered to be only temporary increases over the second semester of 1995.

2. International discussions on parameters to be included in an analysis of present and desirable levels of global food reserves are of a fairly permanent nature, but were intensified over the last year and a half. In this context, the work of FAO Committee on World Food Security, of which the EC is a member, is very important.

3. Temporary high prices for cereals on the world market should be put to profit by what are presently low-income food deficit countries, by using these increases as an incentive to review national policies and favour domestic production, in view of food security objectives, and increased self-reliance in food. In this light, the recent experiences of the Western African countries of the 'franc-CFA zone', after the 50% change of parity with the French franc, is very instructive and encouraging.

4. The CAP has given proof of adaptability and flexibility, with the reduction to 10% of the set-aside rate for arable land for the production year 1995-96, in order to contribute to arresting the price increases of cereals on the world market.

5. The ongoing reform of food aid converts it into an instrument for food security: buying more locally; monetisation; possible substitution with currency; counterpart funds for food security policies and programmes; handing out only to very well targetted vulnerable groups. When combined with other instruments under National Indicative Programmes, the underlying causes for chronic hunger can be better addressed. It is hoped that other main food aid donors will adopt the same lines.

6. EU commitment under the Food Aid Convention is unaltered, whereas the other main contributor has decreased substantially its minimal contribution. Our total annual food aid, has been increased rather then reduced.

7. It should be underlined that in most cases, food insecurity can be greatly reduced by eliminating political unrest, armed conflicts, and by adopting transparent government policies committed to addressing poverty, food security objectives and agricultural development. From that point on, cooperation has a chance to make a significant contribution to socio-economic development.