ECONOMY

World Bank Chief Calls for Immediate Action on Deepening Global Food Crisis

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By Harry Dunphy
Associated Press
Monday, April 14, 2008

The president of the World Bank yesterday urged immediate action to deal with sharply rising food prices, which have caused hunger and violence in several countries.

Robert B. Zoellick said the international community has to "put our money where our mouth is" now to help hungry people. Zoellick spoke as the bank and its sister institution, the International Monetary Fund, ended two days of meetings in Washington.

He called on governments to rapidly carry out commitments to provide the U.N. World Food Program with $500 million in emergency aid by May 1. Prices have only risen further since the program issued that appeal, so it is urgent that governments step up, he said.

Zoellick said that the fall of the government in Haiti over the weekend after a wave of deadly rioting and looting over food prices underscores the importance of quick international action.

He said the bank is granting an additional $10 million to Haiti for food programs.

Zoellick said that international finance meetings are "often about talk," but he noted a "greater sense of intensity and focus" among ministers; now, he said, they have to "translate it into greater action."

The bank, he said, is responding to needs in a number of other countries with conditional cash-transfer programs, food and seeds for planting in the new season.

"This is not just a question of short-term needs, as important as they are," Zoellick said. "This is about ensuring that future generations don't pay a price, too."

The head of the IMF also sounded the alarm on food prices, warning that if they remain high there will be dire consequences for people in many developing countries, especially in Africa.

Dominique Strauss-Kahn had said Saturday that the problem could also create trade imbalances that would affect major advanced economies, "so it is not only a humanitarian question."

Mexican Finance Secretary Agustin Carstens, who heads the bank's policy-setting Development Committee, said officials "need to redouble our efforts" to help the poorest people. He said there had been "a very welcome increase in money" from governments, but all donors need to "reach into their pockets."

Zoellick said the Development Committee endorsed his call for a "New Deal for global food policy," which aims to boost agricultural productivity in poor nations and improve access to food through schools and workplaces.

He said earlier this month that the bank would nearly double the money it lends for agriculture in Africa, to $800 million.

Zoellick also said Sunday that he had received positive feedback from his proposal to have sovereign wealth funds -- investment funds controlled by governments -- invest one percent of their resources in Africa. He said this could draw $30 billion to the continent.

He said the bank was following up on the proposal with countries that have sovereign wealth funds, mainly in East Asia and the Middle East, through the International Finance Corporation, the bank's private-sector arm.

"Hunger, malnutrition and food policy have formed a recurrent theme at this weekend's meetings, and I believe that we have made progress," Zoellick said. "But it will be important to continue to retain the focus on this as we leave Washington."


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