CELEX: 51978PC0235
Language: en
Date: 1978-06-02
Title: Proposal for a COUNCIL DECISION (EEC) on the Community financing of certain costs in respect of cereals food aid under the 1978 programme#Proposal for a COUNCIL REGULATION (EEC) on the supply of butteroil to the Democratic Republic of Somalia as food aid pursuant to Regulation (EEC) No 831/78 (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (78) 235
Vol. 1978/0077
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                 COM(78 ) 235 final .
                                                Brussels , 2 June 1978
                             Proposal for a
                     • . COUNCIL DECISION ( EEC)                 ,
         on "the Community financing of certain costs in respect of
                  cereals food aid under "the 1978 programme
                           , Proposal for a
                        COUNCIL REGULATION ( EEC )
         on the supply of "butteroil to the Democratic Republic
         of Somalia as food aid pursuant to Regulation ( EEC )
                               Ko 831/78
                ( submitted to the Council "by the Commission )
 C0M(78 ) 235 final
 ---pagebreak---                                                                                   Cm
. EXPLANATORY        STATEMENT
  1 . The Government of Somalia presented a request to the Commission in
        October 1977 for food aid in the form of cereals, skimmed milk powder
        and butteroil . This request was received too late for inclusion in
        the general programs for 1978     however , when these were adopted , a
        note was made that the Council would be favourably disposed at a later
        stage towards an allocation to Somalia from the Reserves .
   Food situation in Somalia                        .
  2 . The request has now been examined together with supporting information
        received from FAO and the Commission Delegation in Mogadishu .
        An approximate summary of the food supply , demand and stocks can be
        made and this is given in Annexe 1 .
          In spite of reasonable stock levels following good sorghum crops ,
        the general outlook for 1978 is less favourable than 1977 owing to
        flood damage in certain area ^ and to an increase in consumption needs
      , due to the conflict in the Ogaden ..
        Food import requirements will thus' be higher than in the previous year .
   Cereals
  3 . Production in 1977 of coarse grains ( principally sorghum , and maize )
        showed an increase to an estimated 260 000 t , as a result of a good
        sorghum crop , offset by a below average crop of maize . However import
        requirements for calendar year 1978 are still assessed by FAO at 142 000 t ,
        of which only 20 600 t are covered by planned food aid .    Commercial
        imports during 1977 were 30 000 t , in addition to 9 000 t of food aid,
     • mostly in the form of maize .
   4 . Import requirements for rice for 1978 are estimated at 36 000 t , of
        which 11 900 t are covered by planned food aid.     For wheat ( and flour
        equivalent ), estimated requirements are 57000 t , covered by planned \
        food aid as to 35 000 t . Local production of rice and wheat is very small .
                                                                               .  . ■
 ---pagebreak---                                                                                            3.
     5 . In summary therefore : total cereal import requrements are estimated
          at 235 000 t for 1978 . Against this ,, food aid shipments of 67 500 t are
          expected, leaving an uncovered deficit of 167 500 t for the year .
     Mi Lk powder
     6. Stocks in Mogadishu at end-January 1978 were estimated at 1 631 t ,
          being essentially the balance from EEC food aid deliveries in 1977
          under the 1976 program . Arrival of a further 675 t through World Food
          Program, and 2 500 t from U.S.A. is expected during the first quarter
          of 1978. This gives a total availability of over 4 800 t , which is
          high compared with estimated absorptive capacity through existing
          channels . No plans have therefore yet been made for delivery of
          the 2 750 t outstanding from the EEC 1977 program .
      Edible oils and fat s
     7 . A Ithough ' preci se figures for production and requirements of edible oils
             and fats' has not' been obtainable*- it is estimated that import requirements
           ' fbr '1978 will be. between .10 000 t and 15 . 000 t ; this is assuming annual
             production of 7,000 t ,. principally sesame and . ghee . Expected aid during
             1978 amounts to '4 . 800 t , including .1.600 t butteroil from the EEC 1977
             food aid program . Uncovered import requirements will be therefore between
             5.000 t and 10 000 t .                        -
      Purpose of food aid requested
      8 . Food aid from the Community would be distributed free to former nomads .         .
            from the north of the country , reinstalled with Government assistance
            in farming or fishing settlements . Details are given in Annex 2 ,
            from which it will be seen that the annual requirements for the 96 400
           persons are 17 350 t cereals, 1 040 t milk powder and 695 t butteroil ( 1 ).
                                                                              ν
                                                         /
      9 . Distribution would be under control either of the Settlement Development
            Agency , or of the Coastal Development Agency , the Government organizations
            responsible for implementing the resettlement programs .       ,
                                  •          \
( 1 ) It should be stressed that this is the usage currently intended for the food aid
      Requirements may change , and in particular other groups of beneficiaries may
      emerge .     Part of the aid could be sold on the local market with the proceeds
      being invested in development projects . Precise usage , and details of the
       commodities to be supplied , will as always be specified in the conditions
      negotiated with the recipient country .
 ---pagebreak---                                                                                      4.
      Commission proposals
      10 . In view of the foregoing , and of the current economic position of
            Somalia ( see Annex 3 ), the Commission proposes the allocation of
            the following quantities , for delivery to port of unloading   :
                           - 12 000 t   cereals
                                500 t butteroil .
     11 . No allocation of milk powder is proposed at this time in view of
           existing ample supplies ( See para 6 above ).
     ^ 2. The proposed allocations would be taken from the existing reserves
           under the 1978 food aid programs in cereals and butteroil .    After
           this action , these reserves would stand at 24 200 t and 1 990 t
           respectively ( 1 )                                     -
     13 . The cost of this action to the 1978 budget can be estimated 4 315 000 EUA .
           using internal product prices and estimated transport rates . Of this
           2 231 000 EUA . is chargeable to the Food aid budget and 2 084 000 EUA .
          to the FE06A on the basis of current level of restitutions ( see Annex 5 ).
          No additional expense for the Community arises since these costs are - -
          chargeable to existing credits already approved in the 1978 budget .
    Conclusion
    14 . The Commission therefore proposes to the Council :
          - to decide to allocate 12 000 t cereals and 500 t butteroil to Somalia
             from reserves of the 1978 food aid programs ;
             to decide to finance fpcwarding costs incurred between port of loadinq
             and port of unloading ;
      _ ~ to adopt the annexed legal texts in consequence .
Cereals : Initially 48 200 t ; reduced to 36 200 t after allocations de<Hrf»rf
             or proposed for Djibouti , Bali and Syria.       " location, decided
Butteroil : Initially 1 440 t, in addition to 1000 t refining from 1977 program.
 ---pagebreak--- B. PROPOSED       COUNCIL ' DECISION       AND    REGULATION
                               COUNCIL  DECISION
   on the Community financing of certain costs in respect of cereals food aid
   under the 1978 program .
   THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
         »
   Having regard to the Treaty establishing the European Economic Community ,
   Having regard to Council Regulation ( EEC ) N° 1703/ 72 of 3 August 1972
   amending Regulation ( EEC ) N° 2052 / 69 on the Community financing of expenditure
   arising from the implementation of the Food Aid Convention of 1967 and laying down
   rules for the Community financing of expenditure arising from the implementation
   of the Food Aid Convention of 1971 ( 1 ), and in particular Article 8 thereof ,
   Having regard to the proposal from the Commission ,
   Whereas the Democratic Republic of Somalia would have dif f i cu Ity , , in view of. its
   economic and financial situation , in covering the forwarding costs from the
   port of loading of cereals food aid allocated under the 1978 program ;
   whereas these costs should therefore be borne by the Community ,
   HAS DECIDED AS FOLLOWS       :
               ■■  ' / , ... -                       . '        •
                                      Sole Arti cle
   Community financing shall cover the forwarding costs between the port of
   loading and the port of unloading in respect of cereals food aid allocated
   to the Democratic Republic of Somalia under the 1978 program .
                                                         Done at Brussels ,
                                                          For the Council
                                                           The President .
   < 1 ) O.J. N° L 180, 8-8- 1972, p. 1
 ---pagebreak---                        COUNCIL       REGULATION     (  EEC  )
   on the supply of butteroil to the Democratic Republic of Somalia
   as food aid pursuant to Regulation ( EEC ) N°
   THE  COUNCIL  OF  THE   EUROPEAN   COMMUNITIES ,
   Having regard to the Treaty establishing the European Economic Community ,
   Having regard to Council Regulation ( EEC ) N° 830/ 78 0 f 25' April 1978
   laying down general rules for the supply of milk fats to certain developing
   countries and    specialized bodies " „ under the 1978 food aid program , ( 1 )
  and in particular Articles 3 and 8 thereof ,
  Having regard to the proposal from the Commission,
  Whereas Council Regulation ( EEC ) 831 / 78    0f 25 April 1978       on the supply
  of milk fats to certain developing countries and specialized bodies
. under the 1978 food aid program .( 2 ) provides for a reserve of 1440 tonnes
  of butteroil ;
  Whereas the Democratic Republic of Somalia has requested food aid in the form
  of butteroil ; whereas its needs warrant food aid from the Community ;
  whereas it would have difficulty, given 1t 5 economic -and financial^ituation,
 in covering the forwarding costs from the port of loading ;
 whereas these costs should therefore be borne by the Community ,
                                                                                      .
  ( 1 ) O.J. N°   L 115 , 27.4.1978 , p .6 .
  ( 2 ) O.J. N®   L 115 , 27.4.1978 , p.8 .
 ---pagebreak---                                                                                7.
HAS ADOPTED THIS REGULATION        :
                                  Article          1
                                       ί                           ·
Of the 1440 tonnes            of butteroit provided for as a reserve by
Regulation ( EEC ) N° 831 / 78 / 500       tonnes     shall be allocated to
the Democratic Republic of Somalia .
                                  Article          2
                                  1111   ■   1 ■ !  ■              / '
Community financing shall cover the forwarding costs incurred between the port
of loading and the port of unloading .
                                  Article          3
This Regulation shall enter into force on the third day following its
publication in the Official Journal of the European Communities .
                            /
This Regulation shall be binding in its entirety and directly applicable
in all Member States .                                                          '
Done at
                                                        For the Council .
                                                        The President .
 ---pagebreak---                                                                                                                              ANNEX     1
                                SOMALIA       :  ESTIMATION     OF   THE      FOOD   SITUATION          :     2 / 78
                                                                                                                              πιΐη χ 1000
                                                      1977    Imports                                  Import                       Uncovered
                                    Production                                       Stocks                           Planned
        Product                                                                                     Requirements        Aids        Retirements
                                                                        Non-
                                        1977       Commercial                         1 / 78                            1978
                                                                   commercial                            1978                          1978
                                                                                  !
  Wheat ^                                1,0          24,0              55,0           27,0               57,0         35,0              22,0
  Ri ce                                  1 '0         20,0              11,0           25,0               36,0         11,9              24,1
                                      ê
  Coarse grains                       260,0           30,0               9,0           61,0             142,0          20,6            121,4
  Total - Cereals                     262,0           74,0              75,0          113,0             235,0          67,5            167,5 '
  Mi Ik powder                           0             0                 3,0             1,6               ■             5,9
  Edible oi Is                           7,0          11,0            "  0               3,8            10 / 0-15,0      4,8         5,0-10,0
                                                                                                                              ,
(1)   Including flour , etc ..., expressed in tons of wheat equivalent
(2)   Sorgho/ Dura , and maize
                                                              Sources    : ( 1 ) FA0       ( 2 ) Delegation Commissiorv Mogadishu.
 ---pagebreak---                                                                                                                            ANNEX   2
                              PROPOSED        USE OF  1978     FOOD     AID    TO      SOMALIA
                                                                                  Annual     requirements ( t ) ( 2 )
                                                             Population ( 1 )        Cereals          Milkpowder        Butteroi l
                                                                                :             :   –
    Sett lement   Development  Agency      :                  /
                                                                21 000                3 780                227             151
         Kurtum Warey
                                                                39 400                7. 090               424             283
         Dujumma
                                                                22 200                4 000     ,          240             161
         Sablaleh                    '      -
    Coastal   Development   Agency     :
I       Brava                            «                       5 800                1 040                  63             42
        Adale                      -                             4 900                   880                 53
                                                                                                                      .      35
        Eyl                                                      2 900                   520                 31              21 -
                                                                    200                   40                   2              2
         El Aimed .
                                                                96 400               17 350              1 040             695
    Tot a I
  (1)   Adults and children                                                        <
  ( 2 ) Based on daily ration 500 gr . cereals, 30 gr . milkpowder , 20 gr . butteroil .
                                                                                      Λ
                                                                                                                                     «o
 ---pagebreak---                                                                                                 10 .
                                                                                    ANNEX    3
  SOMALIA
                           Basic      country          data
   GNP per caput    ( 1975 est .)           :        §   110
   Population   ( mid-1976 est .)           :        3,26 million
,  Balance of payments     ( 1976 )         :        $ 69,2     million deficit
   Imports of goods and services         ( 1976 ): S 221,8      million
   International reserves      ( 8/ 1977 ) :         S   82.2   million
   Classification      :   MSA country
                           FAO food priority country .
   ( Sources  :   IBRD   and IMF )
                                                                                     ANNEX    4
                          Previous         EEC    food       aid
                                           Cereals               S M P          Butteroi l
       1970                                 8 000 t
       1971
       1972                                15 000
       1973                                 7 000
       1974                                  5 000              1 060              650     ,
       1975                                25 000 -,            2 000              850
       1976                                25 000               3 000            1 100
       1977                                25 000               2 750            1 600
                                                               –         l
       Total                              110 000 t             8 810 t          4 200 t .
 ---pagebreak---                                                                                                      11-
                                                                                      ANNEX      5
                     FINANCIAL      STATEMENT                                                              ,,
                                    .         •   .                                                           J
         ' ,                               •                     • •          '     . •                        i
                                                ■   ■                                   ■■   ■
  1. Relevant budget headings
     - 1978   budget -   article 920 ,    post 9201
                                                        '    ι    ·                                            !
     - 1978  budget ,    article 921 / post 9212          v.                     .                             '
     - 1978 budget ,     article 600, post' 6001                                                                ]
     - 1978 budget ,     article 620, post 6201                                                            f !
                                '                                           v                  .                I
  2. Budget heading descriptions '
     - Post 9201   : " Food aid in cereals - 1978 program"
     - Post 9212   : " Food aid in dairy products - 1978 butter / butteroi I program "
     - Post 6001   : " Restitutions for Community food aid in cereals for current year1'
     - Post 6201   : " Restitutions for Community food aid in dairy products for
                                  -                                                        current year ".
  3. Legal basis
     - Cereals     : Council decision of 30 January 1978
     - Butteroil   : Council regulation • 831 / 78                 25 / 4 / 78
  4. Description , purpose and justification
     Allocation of food aid to Somalia under 1978 programs .
                                                                                   :                           i
                                                      I                        ■                              )
*                                                              .                                              !
 ---pagebreak---   Credits
  5.1     Computation
          - Cereals     :
                  Commodity         12 000 t x 163 ( 1 ) EUA / t       1 956 000   EUA
                  Sea transport     12 000 t x 50    EUA / t             600 000
                                                                       2 556 000
                 Restitutions       12 000 t x 79   EUA / t              948 000   '
                                                                      1_608_000   EUA
         - Butteroil       :
                 Commodity             500 t x 3 367 ( 1 ) EUA / t    1 684 000   EUA
                 Sea transport         500 t x    150       EUA / t       75 000
                                         \
                                                                      1 759 000
                                                             t
                 Restitutions          500 t x 2 272        EUA / t   1 136 000
                                                                         623_000  EUA
        - Total net cost
                                                                      2 231 000   EUA
        ( 1 ) Internal price including transport to port
 5.2    Imp utation
       IllLeJX : Cooperation with developing countries
                 - Post 9201    - Cereals food aid                   1 608 000
               • ~ Post 9212    - Butteroi I food aid                   623 000
                                                                    2 231 000    EUA
       IlUe.VI       :    FEOGA
                 - Post 6001      Cereals food aid                      948 000
                 - Post 6201    - Dairy products food aid           1 136 000
                                                                    2 084 000    EUA
5.3 Additional expenses
      This action does not , involve expenses for the Community additional
      to those already approved under 1978 food aid programs.
Control
Financial reguUtion
Of the Communities .
                                             ^^                ^             ^     y