EC proposes US$1.6 billion aid to help feed developing countries

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Publish time:7/21/2008 12:00:00 AM      Source: www.cnchemicals.com
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July 21, 2008

EC proposes US$1.6 billion aid to help feed developing countries

The European Commission (EC) proposed giving 1 billion euros (US$1.6 billion) to help developing countries cope with escalating food prices and improve agricultural production.

Referring to the proposal made last Friday (July 18), the European Union''s executive arm said in a statement that the aid programme will run for two years, 2008 and 2009.

To improve productive capacity, EC will look at supply-side measures, improving access to farm inputs such as fertilizers and seed, and safety-net measures aimed at improving agricultural output.

The US$1.6 billion facility "aims to generate a strong and rapid agricultural supply response," said EC president Jose Manuel Barroso, adding that soaring food prices can be extremely adverse to the worlds'' poorest populations.

EC said that they will follow a set of transparent selection criteria in deciding a country''s eligibility and the portion of aid each country can receive. Criteria include reliance on food imports, food price inflation, social and fiscal vulnerability. EC said that priority will be given to countries severely hit by food prices yet do not have the means to alleviate the crisis.

The money, which adds to existing development funds, would be paid through international and regional organizations like the United Nations and the World Food Program.

EC hopes EU governments and the European Parliament could approve its proposal by November so that they can implement the plan in early 2009.

But several member states have voiced doubts as the money will be taken from unused funds from the EU''s agricultural budget, including unspent subsidies to farmers.