Following is a Web version of a document from USAID's 1997 Congressional Presentation. Please note that some formatting may have been lost in the automated conversion of the original file. This document is also available for download in its original WordPerfect 5.1 format.

FY 1997 P.L. 480 Title II: $837,000,000
FY 1997 P.L. 480 Title III: $40,000,000

On a global level, more than 800 million people today are chronically undernourished and more than 180 million children are severely underweight. For the United States, global hunger is both a humanitarian concern and a strategic problem. The U.S. Government gives of its resources to help those in need and in crisis even as it seeks to eliminate the food insecurity that fuels political instability and environmental degradation.

Despite economic growth and increased global food supplies, malnutrition persists and the longer-term trend is somber. A 1995 U.S. Department of Agriculture study entitled "Food Aid Needs and Availabilities: Projections for 2005", concludes that "global production capacity is projected to produce adequate supplies of grain ...." However, because of income distribution inequities, high population growth rates, and slow rates of development, in sub-Saharan Africa and south Asia in particular, the study finds that "Food aid needs will nearly double over the next decade, even with reasonably optimistic assumptions about recipient countries' ability to produce their own food or to import food commercially. Total food aid needs to maintain consumption and meet emergency needs are projected at 15 million tons in 1996, increasing to 27 million tons by 2005."

P.L. 480 Food for Peace is a people-to-people program, from the people of the United States to people who do not have access to sufficient food to meet the needs for a healthy and productive life. In FY 1995, Title II food assistance directly benefited 55.7 million poor people in some 58 developing countries. Of that number, 23.2 million were disaster victims and 32.5 million were beneficiaries of development projects. Most of these people were women and children who suffer most in emergencies caused by war or drought, or who took part in nutrition and health improvement activities, or in primary education and training programs. The hungry poor who received Title II assistance also included landless agricultural workers, small farmers and the urban poor - people below the poverty line with insufficient food and not enough money to buy the food needed for themselves and their families.

P.L. 480 programs benefit American businesses. Nine of the ten leading importers of U.S. agricultural products are former recipients of food assistance. For the first time in history in 1995, the United States exported more than $1 billion in agricultural products a week. Some of this success must be attributed to P.L. 480 programs. Food aid positively affects almost every state in the union, with benefits accruing not only to farmers but also to food processors, packers, transporters, railroads, stevedores, ocean carriers and others.

One of the strengths of food aid is its immediate application in feeding people--either as part of a humanitarian relief effort, as part of a recovery strategy, or as part of a broader development effort.

Title II Emergency and Private Voluntary Organization Assistance Programs

Title II programs are managed by USAID, working in partnership with U.S. private voluntary organizations (PVOs), international and local nongovernmental organizations (NGOs) such as the International Committee of the Red Cross and United Nations agencies such as the United Nations Emergency Children's Fund (UNICEF), and the World Food Program (WFP). WFP is a prime instrument through which the U.S. provides multilateral food aid and U.S. food and cash contributions are estimated at nearly one third of WFP's overall operating budget. As a lead donor, the U.S. has been in the forefront of working with WFP to improve its financial and management controls for distributing, monitoring and safeguarding donated commodities.

Title II works in the following areas:

-- In crisis, Title II assistance performs the most basic of functions, it saves lives. Drought, flood, and the ever increasing number of disasters caused by man rather than nature often lead to life-threatening food needs. The scope and level of global emergency food aid needs continue to increase. Worldwide estimates of people requiring emergency food aid in order to maintain minimum nutrition now exceed 26 million. Overall requirements for these vulnerable groups approximate 3.5 million tons of food at a cost of roughly $2 billion. In FY 1995, the U.S. contributed over 1 million tons of food at a cost of over $500 million toward these requirements.

-- In non-emergency settings, Title II programs focus on improving agricultural infrastructure to bring about sustained improvements in agricultural productivity. Labor-intensive, food-for-work activities support such diverse activities as the establishment of village-level grain and seed banks, the establishment of tree and shrub nurseries, the building of small-scale irrigation infrastructure, the construction of farm-to-market roads, promotion of terracing and reforestation, flood prevention embankments, and more. In areas where water is scarce, irrigation systems and more efficient use of water resources can increase agricultural productivity many times over.

-- Title II feeding programs at health centers encourage mothers to bring in their children. At these centers, children are immunized and mothers receive training in nutrition, health, family planning, community leadership, and even literacy.

-- Title II school and preschool feeding programs, in addition to increasing children's nutritional intake, promote and ensure school enrollment and attendance leading to improved educational benefits.

-- In Title II food-for-work efforts, impoverished people are paid in food for their work on projects that will improve their economies and increase economic opportunities for themselves and their neighbors: farm-to-market roads, water systems for irrigation and consumption, food storage facilities, flood prevention embankments, and more.

USAID policy provides for:

-- Priority to be given to programs in those countries that need food most and where food insecurity is greatest. Title II programs will focus on improving household nutrition, especially in children and mothers, and on alleviating the causes of hunger, especially by increasing agricultural productivity.

-- Allocation of resources and management of programs to increase the impact U.S. food aid has in reducing hunger; food aid will be integrated with USAID dollar and other development assistance resources through improved country-level planning that assures complementarity between food aid and other USAID assistance resources, and through greater cooperation with other donors.

-- Greater attention and resources allocated to strengthen the program development and management capacity of USAID's food aid partners.

-- Greater flexibility to respond to emergencies. Since overall U.S. food aid tonnages are likely to be reduced due to lower appropriations and higher commodity prices, this flexibility must come from such measures as expanding and improving multilateral coordination.

Most important, USAID expects its food aid and food security programs to result in local capacity for continued progress, even after U.S. assistance programs end. Building this local capacity is highlighted as an important objective of all USAID activities, since it is essential both to improved food security and to sustainable development.

Hence, USAID is committed to working closely with all partners to:

-- refine the concept of country (national) food security assessments through better definition of purpose, key elements, trends, data quality and discrepancies, and local government commitment. In this context, USAID and the European Community have agreed to take the necessary measures to promote the formulation of national food security strategies and an action program which will clearly define the roles and the contributions of recipient governments, donors and executing agencies by December 1996 in five low-income, food-insecure countries, Ethiopia, Eritrea, Malawi, Angola, and Bolivia;

-- continue the momentum on identifying common, generic performance indicators and mutually acceptable methodologies that USAID and PVOs can use in measuring the impact of food aid.

Financial resources also are specifically dedicated to strengthening the program development and management capacity of USAID's food aid partners. Funds authorized under section 202(e) of P.L. 480 and institutionalsupport grants authorized by the Foreign Assistance Act assist cooperating sponsors toward: (a) improved country program capabilities to use Title II food as a resource to achieve food security; (b) better accounting for Title II commodities; and (c) enhancing management skills of our partners involved in Title II programs both overseas and at Headquarters. For FY 1997, it is anticipated that $28 million in section 202(e) grants will be channeled to cooperating sponsors.

The following are examples of Title II programs implemented in FY 1995:

-- The successful use of food aid to feed Mozambique's 2 million returnees from six neighboring countries of asylum has allowed for peaceful resettlement, farming activity and infrastructure improvements to the point where 1997 will see the elimination of emergency food aid except where required to respond to drought.

-- In Bangladesh, WFP uses Title II food aid in its vulnerable groups development activity to help rural women move out of extreme poverty. It provides food aid assistance to over 500,000 women per year, many of whom are destitute, heading households, or considered most vulnerable by their communities. The project focuses on income generation and training, using a recognized and effective local nongovernmental organization, the Bangladesh Rural Advancement Committee. Over and above Title II and other donor inputs, Government of Bangladesh direct contributions for this project have grown from 11,500 metric tons (mts) of wheat in 1992-93 to 51,830 mts in 1995-96.

-- In northern Ethiopia, the nongovernmental organization Relief Society of Tigray, which for a number of years successfully implemented Title II food-for-work environmental rehabilitation and agricultural development activities through the Catholic Relief Services, is now recognized as a cooperating Title II sponsor. This is an excellent example of institutional development in food aid programming and implementation emanating from a partnership between a U.S. PVO and a viable, autonomous national NGO.

-- In Uganda, the U.S. PVO Agricultural Cooperative Development International, has monetized Title II vegetable oil imports through public auction, resulting in the wide participation of small marketers and reduced price fluctuations through provision of a fixed monthly sale schedule. Use of local currency generated from the sale of P.L. 480 commodities has been used to expand local production, marketing and processing of edible oil seeds, with an expected 8,000 metric ton increase during 1996.

-- In the former Yugoslavia, USAID's Title II food aid has meant the difference between life and death for 1.4 million Bosnians over the past few years. U.S. food aid, in the form of wheat and wheat flour, has been one of the foremost demonstrations of the American people's concern for Bosnia's well-being.

Farmer-to-Farmer Program

Title II also is being used to support the Farmer-to-Farmer (FTF) Program (Title V, section 501 of P.L. 480) both worldwide and in a special initiative in the New Independent States (NIS) of the former Soviet Union, with particular focus on the Russian Federation, Ukraine and Kazakhstan. In the worldwide FTF program, over the past four years, approximately 1,200 volunteers have served overseas, providing technical assistance and training to farmer associations, cooperatives, and other farm groups to enhance their potential for substantial increases in food processing, production, and marketing to stimulate private-sector enterprises and democratic institutions. The objectives of the FTF program in the NIS are (1) to increase food availability to consumers in the near term and (2) to take steps to help ensure that existing food shortages and distribution problems do not continue over the long-term. Since 1992, some 2,000 volunteers have served through the NIS program. FTF volunteers have come from 49 of 50 states.

FTF achievements include:

-- FTF volunteers have helped form private farmer cooperatives, open supermarkets, improve food processing, start radio programs for farmers, develop commodity exchanges and build farmer's associations. They also help strengthen private banking, establish land appraisal and mortgaging systems, find project financing, advise on land reform and create extension services. Some 1,300 technical documents have been translated and disseminated for use in the NIS.

-- FTF volunteers have focused on skills essential to running farms as businesses and have a significant impact on agricultural marketing. They have worked with 293 food processing plants and introduced 317 improvements in food and fiber processing in local areas. They helped introduce 1,013 new products, services and crop varieties in different areas in the NIS. Working with 93 new private banks, volunteers have helped institute Western banking practices and create agricultural lending systems.

-- The FTF program has significantly affected the lives of 120,000 individuals in the NIS, of which 32% are women. FTF has trained over 53,000 individuals in workshops on farm management, cooperative development, farm insurance, banking, food processing and privatization policy. The FTF implementors have leveraged other funds to sponsor training missions to the U.S. for over 600 NIS citizens.

-- Over six million people in the U.S. have learned about NIS agricultural developments through press articles, radio and television programs, and speeches by volunteers and staff.

Title III Food for Development

The P.L. 480 Title III program is a key USAID instrument for enhancing food security in least developed countries. Since Title III is a government to government program, it provides USAID with an opportunity to address critical policy constraints within the context of national governments' food security and overall development agenda.

To address the persistent and growing need for food aid in low-income, food-deficit countries, USAID has made some fundamental shifts in the programming of Title III resources. USAID's food aid policy focuses the Title III program as follows: (a) Priority in allocating food aid will be given to countries most in need of food and that can demonstrate its importance for promoting long-term food security; and (b) highest priority will be given to programs with direct linkages to increased agricultural production and consumption.

Programs will continue to have a focus on policy reform by recipient governments. Examples of desired policy reform include: changing agricultural pricing policies that are unfavorable to producers and discourage productivity-enhancing technologies, ending import and export policies that reduce investment in agricultural enterprises, and generating investments in rural infrastructure which support economic growth. Local currencies generated from Title III programs are used to advance food security goals.

Title III achievements in FY 1995 include:

-- In Bangladesh, the Title III program helps increase food access by the poor through increased public investment and improved incomes. Policy reforms supported reduction in government interventions in food marketing. Local currency supported introduction of a "food for education" program and increased government expenditures for education, health, sanitation, family planning, and water.

-- In Ethiopia, four major government parastatals that formerly controlled food marketing were abolished. The Emergency Food Security Research Administration was established to manage food reserves in the context of disaster preparedness. A targeted Food Safety Net program, which reaches 250,000 destitute urban and rural people, was established.

-- In Guyana, Title III-driven policy reforms have leveraged an increase in agriculture's share of gross domestic product 24% in 1991 to 30% in 1994. Estimated annual household incomes have increased in one target area by $263 per farm family. Local currencies generated by the program support rehabilitation of seawalls, repair of farm-to-market access roads and rural water supply systems, and an improved nutritional surveillance system.

-- In Haiti, wheat flour prices were reduced and stabilized, with a correspondingly positive impact on household incomes. Local currency support for the job-creation program has resulted both in positive impact on the income of workers and improved infrastructure in their communities. Nationally, liberalized trade policies leveraged through policy reform are expected to improve general food availability through increased trade.

-- In Honduras, a 1994 evaluation of previous Title III efforts demonstrated measurable impacts on the availabilityof and access to food among the rural poor through enhanced producer prices for basic grains, increasing availability of basic grains, increasing household income, reducing the proportion of the poor in rural areas, and reducing the percentage of rural households in the lowest income ranks. Local currencies continue to support the government's family assistance program, which provides a social safety net during adjustment.

-- For Mozambique, self-targeting yellow corn increases food availability among the poorest. The program has increased private sector activity in food marketing. Rural-urban market linkages have been strengthened which will eventually reduce the number of Mozambicans dependent on food aid for survival.

-- In Nicaragua, a food-security data-gathering and analysis program is supported by Title III local currency resources. The program has strongly boosted government delivery and coverage of primary health care in needy areas.

FY 1997 Title III country programs will be few in number and determined on a needs and performance basis.

Commodity availability has decreased and prices have risen accordingly in FY 1996, especially for wheat and corn, as for wheat and corn products. USAID used the U.S. Department of Agriculture's estimated commodity prices for FY 1997, which are low relative to current prices, in projecting metric tonnages to be purchased. Current availability and pricing constraints may continue when FY 1997 becomes the operating year, however. If this is the case, USAID will not be able to procure the tonnage projected in its P.L. 480 summary food table.

P.L. 480 Summary Tables I
P.L. 480 Summary Tables II
P.L. 480 Summary Tables III
P.L. 480 Summary Tables IV
P.L. 480 Summary Tables V
P.L. 480 Summary Tables VI
P.L. 480 Summary Tables VII
P.L. 480 Summary Tables VIII
P.L. 480 Summary Tables IX