Order Code RS21279 Updated May 2, 2005 CRS Report for Congress Received through the CRS Web International Food Aid: U.S. and Other Donor Contributions Charles E. Hanrahan Senior Specialist in Agricultural Policy Resources, Science, and Industry Division Carol Canada Technical Information Specialist Resources, Science, and Industry Division Summary The United States is the world’s major provider of international food aid to lowincome developing countries. This report provides three indicators of the U.S. contribution to global food aid: (1) shipments of major donors compiled by the International Grains Council, (2) U.S. contributions to the United Nations World Food Program (WFP), and (3) the U.S. commitment under the Food Aid Convention (FAC). U.S. food aid accounted for 59% of food aid shipments by major donors during 1995-2003. A substantial portion of U.S. food aid is channeled through the WFP. During 1996-2004, around 48% of the food aid distributed by the WFP came from the United States. The Food Aid Convention (FAC), now expired, was an agreement among donor countries to provide a minimum amount of food aid to low-income developing countries. The food aid commitment by all FAC signatories was approximately 4.9 million metric tons (mmt). The United States pledged to provide 2.5 mmt or 51% of the total commitment. Contributions of Major Donors to International Food Aid The United States is the major contributor to international food aid, supplying on average, since 1995, around 59% of annual total food aid (see Figure 1) provided by donors who are members of the Food Aid Committee of the International Grains Council and signatories of the 1999 Food Aid Convention.1 U.S. contributions increased from 1 Information on the International Grains Council, the Food Aid Convention, and the Food Aid Committee is available at [http://www.igc.org.uk/]. Congressional Research Service ˜ The Library of Congress CRS-2 Figure 1. Food Aid by Major Donors, 1995-2003 EU 25.5% Japan 5.7% Canada 5.2% Austr alia 3.3% Other 1.5% USA 58.8% Figure 2. Food Aid Contributions to the World Food Programme, 1996-2005* U.S. 48.1% around 2.8 million metric tons (mmt) measured in wheat equivalent in 1995/ 1996 to about 6.1 mmt in 2002/2003 (see Appendix Table 1).2 U.S. contributions averaged 4.8 mmt annually. Food aid from the European Union (including food aid provided by the European Commission and by individual member countries of the EU) has been more stable and averaged around 2.1 mmt or 26% of average annual food aid shipments. Japan and Canada provided 5.7% and 5.2%, respectively, of the total from major donors. Japan’s contributions are provided as cash rather than commodities. Because food aid data are reported on a July/ June marketing year basis, they do not correspond, for example, to fiscal year food aid data reported by the U.S. All Others 14.4% Department of AgriculTotal EU 30.2% ture in budget documents Japan 7.3% or by the U.S. Agency for International Development in annual food aid * Data as of April 11, 2 005. reports. The source of the data in Figure 1 and Appendix Table 1 is the annual report Food Aid Shipments, prepared by the Food Aid Committee of the International Grains Council.3 2 Data on food aid shipments provided by the International Grains Council are reported on a marketing year basis (July-June). 3 International Grains Council, Food Aid Committee, Food Aid Shipments 2002/2003: Report on Shipments by Members of the Food Aid Convention, July 2004. CRS-3 Food Aid Contributions to the World Food Program Most U.S. food aid is provided on a bilateral basis, but a substantial portion is channeled through the United Nations World Food Program (WFP), the intergovernmental agency that provides food aid for development projects and humanitarian relief in low income countries. More than 56 donors, mainly countries, but also some non-governmental organizations like the International Red Cross, contribute to the WFP. The United States is the major donor, providing over the last nine years around 48% of total WFP contributions (see Figure 2 and Appendix Table 2). Over that same nine-year period, the EU (again combining European Commission with EU member countries’ contributions) accounted for around 30% of total WFP contributions. Japan, whose contributions are in cash, provided around 7%. The remaining donors combined provided about 14% to WFP food aid resources. Donor contributions to the WFP are not in addition to, but are included in, the data reported in Figure 1 and Appendix Table 1. Commitments under the Food Aid Convention The Food Aid Convention (FAC), first agreed to in 1968 during the Kennedy Round multilateral trade negotiations held under the auspices of the General Agreements on Tariffs and Trade (GATT), was an international agreement that constituted a framework of cooperation on food aid between major donors. The Figure 3. Food Aid Commitments food aid commitment under the under the Food Aid Convention, 1999 FAC was a minimum commitment and was intended to be a EU 27.0% guarantee of food security for low-income developing counCanada 8.6% tries. The signatories of the Japan 6.1% FAC were Argentina, Australia, Norway 0.6% Australia 5.1% Switzerland 0.8% Argentina 0.7% Canada, the European Union and its member countries, Japan, Norway, Switzerland, and the United States. Signatories could provide more than their minimum commitment. USA 51.1% The current FAC was negotiated in 1999 and expired in 2003. Under the FAC, the donors could express their annual food aid commitments in either tonnage or in value, but most continue to use the former. Japan is the major exception, although the EU also provides some food aid in the form of cash. The total commitment under the most recent FAC (1999-2003) was 4.9 mmt (see Figure 3 and Appendix Table 2). The United States made the largest commitment, 2.5 mmt or 51% of the total. The combined EU commitment was around 27%. Commitments by Canada, Japan, and Australia were, respectively, 8.6%, 6.1%, and 5.1%. Seven of eight FAC signatories have exceeded their FAC commitments in each of the last six years. Only Argentina has not met its FAC commitment. CRS-4 Although the FAC expired in 2003, a working committee of the International Grains Council has been established to prepare for its renegotiation.4 Concurrently, trade-related aspects of food aid are being negotiated in the multilateral trade round known as the Doha Development Agenda (DDA). The Food Aid Committee of the IGC continues to meet periodically to review donor food aid contributions in relation to commitments under the 1999 FAC and to global food needs and has agreed that the existing FAC should be extended for a further two-year period after July 1, 2005. Renegotiation of the FAC, however, appears unlikely until the DDA trade negotiations have been concluded. Table 1. Annual Commitments under the 1999 Food Aid Convention (metric tons wheat equivalent) Argentina Australia Canada EU Japan Norway Switzerland USA Total 35,000 250,000 420,000 1,320,000 300,000 30,000 40,000 2,500,000 4,895,000 0.72% 5.11% 8.58% 26.97% 6.13% 0.61% 0.82% 51.07% 100.00% Source: International Grains Council Food Aid Committee, The Food Aid Convention. 4 IGC-FAC Press Release, 8 December 2004, available at [http://www.igc.org.uk/press/ pr041208.htm]. CRS-5 Appendix Table 1. Food Aid by Major Donor, 1995-2003 (in metric tons wheat equivalent) Argentina Australia Canada EU Japan Norway Switzerland USA Total 1995/96 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 13,400 10,135 2,740 298,146 305,127 293,221 273,064 296,713 251,865 245,828 448,764 468,431 417,917 487,095 470,640 272,925 393,367 2,413,991 2,049,691 2,201,162 1,969,892 1,970,768 2,341,277 1,836,717 474,870 326,835 302,626 561,643 337,357 635,158 453,735 6,233 32,816 19,306 61,293 75,960 79,857 74,318 75,479 38,636 57,915 38,939 61,295 50,804 58,042 2,849,384 2,553,283 2,818,500 4,734,121 5,692,116 6,798,280 7,124,407 6,580,267 5,774,819 6,110,647 8,136,182 8,907,589 10,430,166 10,186,414 Source: International Grains Council Food Aid Committee, Food Aid Shipments 2001-2003. 2002/03 203,820 451,537 1,980,781 668,557 134,692 67,892 6,054,197 9,561,476 Total 26,275 2,167,784 3,410,676 16,764,279 3,760,781 484,475 449,002 38,624,288 65,687,560 Annual Average Metric Percent Tons 0.04% 3,284 3.30% 270,973 5.19% 426,335 25.52% 2,095,535 5.73% 470,098 0.74% 60,559 0.68% 56,125 58.80% 4,828,036 100.00% 8,210,945 CRS-6 Appendix Table 2. Food Aid Contributions to the World Food Program, 1996-2005 (thousand dollars) United States of America European Union EU Commission EU Countries Austria Belgium Cyprus* Czech Republic* Denmark Finland France Germany Greece Hungary* Ireland Italy Luxembourg Netherlands Poland* Slovak. Republic* Slovenia* Spain Sweden United Kingdom Japan All Others TOTAL 1996 1997 1998 1999 2000 2001 2002 2003 494,980 603,981 196,873 407,108 4,774 19,472 408,380 550,522 237,254 313,269 4,910 17,416 876,284 522,397 184,645 337,752 3,853 16,908 718,856 461,800 168,098 293,702 3,710 10,782 795,676 442,495 117,509 324,986 2,854 6,284 1,210,543 436,559 118,411 318,149 1,117 5,294 933,217 560,653 179,205 381,448 3,302 5,748 1,459,324 620,929 201,463 419,466 2,199 8,480 53,064 16,045 19,203 96,036 150 44,248 13,768 21,884 68,487 170 43,384 13,801 24,742 61,779 25 46,900 15,345 27,693 53,089 1 41,908 15,219 26,170 46,750 130 39,385 14,467 35,929 58,088 39,964 17,445 14,457 60,920 39,335 17,793 14,939 46,458 200 3,149 34,876 218 78,804 4,284 9,112 4,378 10,632 270 45,532 5,021 20,817 130 55,003 7,639 19,936 1,205 62,801 7,317 36,060 1,735 59,481 10,390 38,016 2,919 58,795 11,815 40,480 3,913 50,422 13,720 33,164 34,434 124,032 222,166 1,445,159 * Joined European Union in 2004. Source: World Food Program. 45,972 12,245 35,985 34,789 98,991 253,647 1,311,540 2,725 29,511 80,212 123,757 204,811 1,727,248 2,511 28,415 24,284 106,438 268,274 1,555,369 3,256 30,778 60,056 260,099 252,853 1,751,123 3,946 27,711 27,620 91,139 165,999 1,904,241 2,607 31,167 95,718 92,896 222,338 1,809,104 5,357 42,341 135,734 129,938 362,983 2,573,174 As of April 11, 2004 2005 1,044,168 692,984 200,501 492,483 2,189 10,750 5 98 43,247 17,860 30,288 65,126 16 65 13,684 47,613 5,413 77,738 356 25 33 17,553 44,540 115,884 135,730 342,017 2,214,899 313,021 295,763 59,059 236,704 1,165 5,979 541 38,887 4,071 9,954 17,052 236 120 4,699 7,196 2,746 62,693 30 3,938 61,879 15,518 93,781 176,299 878,864 Total 8,254,449 5,188,083 1,663,017 3,525,066 30,073 107,112 5 639 430,322 145,814 225,259 573,785 928 185 72,374 264,739 18,549 597,241 356 55 33 67,858 365,492 624,248 1,256,801 2,471,387 17,170,720