Zoellick Urges G8 Leaders to Deal With Food, Fuel Crises

July 2, 2008 07:00 PM

via a special arrangement with Informa Economics, Inc.

President Bush comments on issue of food aid

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

World Bank President Robert Zoellick on Wednesday said the current food and fuel price crisis is not natural but a "man-made catastrophe" and urgently called on the Group of Eight (G8) industrial nations and oil producers to step in and help.

Meanwhile, President George Bush on Wednesday also addressed the issue of food aid, saying he will encourage other leaders to increase food, fertilizer and seed shipments to countries in need. “It’s one thing to talk about the problem,” he said. “This is a practical way to help countries deal with the lack of food.” He also advocated efforts to help distressed countries grow more of their own food. He said that “it makes sense for the United States, if we’re going to be providing food aid, to encourage people to grow their own food so we don’t have to deal with this problem on a regular basis,” Bush said. He also urged the use of biotechnology to help countries reduce their reliance on outside assistance and make them more self-sustaining.

The recently signed emergency supplemental bill for the wars in Iraq and Afghanistan included $1.865 billion — or $745 million more than the president’s request — for international food and disaster assistance. The measure, which Bush signed on Monday, includes $500 million more than the president requested for food assistance under P.L. 480 and $245 million more than the president’s request for development assistance and disaster assistance programs that are designed to alleviate world hunger.

The G8 is an annual meeting attended by the leaders of Canada, France, Germany, Italy, Japan, Russia, the United Kingdom and the United States, plus the president of the European Commission.

Zoellick writes a letter. In a letter to Japanese Prime Minister Yasuo Fukuda, host of the G8 economic summit July 7-9, Zoellick said that $10 billion is needed to meet the short-term needs of those hardest hit, including $3.5 billion for safety-net assistance, such as school lunches and cash transfer programs, as well as agricultural inputs such as seeds and fertilizers, in 50 countries. The $6.5 billion balance represents short-term needs estimated by he UN World Food Program.

"I urge the Group of Eight countries, in concert with major oil producers, to act now to address this crisis," Zoellick said. "This is a test of the global system to help the most vulnerable, and it cannot afford to fail."

The bank said that the increases in corn, rice and wheat prices since January 2006 cost developing countries $324 billion last year alone, potentially pushing some 105 million people into poverty. In some 40 countries, GDP could decline between 3 and 7 percent. While grain prices have started to dip with the harvesting of this year's crop, the bank said high prices are likely to persist into 2009 and will remain "well above 2004 levels through 2015 for most food crops."

"We are starting to see a breakdown in the international food and agriculture market," Zoellick said at a seminar sponsored by the American Enterprise Institute. He said restrictions on food exports and talk of "self-sufficiency" are "far from an open trading system." He added that, "The poor are getting hit by a double jeopardy of food and fuel prices.”

Importantly, a World Bank report said the G-8 should consider the merits of an internationally-coordinated virtual humanitarian strategic reserve system for food emergencies. Also, United Nations World Food Program Executive Director Josette Sheeran and her staff urged G8 leaders to consider endorsing an international grain reserve for humanitarian purposes.

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


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