Food facility – EU rapid response to soaring food prices in developing countries
In order to provide a rapid EU response to soaring food prices in developing countries, a Regulation establishing the so called 'Food Facility' was adopted by the European Parliament and the Council in December 2008. This new instrument provides for € 1 billion funding to be spent over three years, nearly half of which in 2009.
Priorities for support
The €1bn food facility will enable the EU to respond rapidly to problems caused by soaring food prices in developing countries. Operating over a 3-year period from 2009-2011, the fund will bridge the gap between emergency aid and medium to long-term development aid. Its chief objectives are to:
- encourage food producers to increase supply
- deal directly with the effects of volatile food prices on local populations
- increase food production capacity and improve the way agriculture is managed in the longer term.
In concrete terms, it will support:
- measures to improve access to agricultural inputs and services including fertilizers and seeds – with special attention to local facilities and availability
- safety-net measures to maintain or increase agricultural production capacity and help meet the basic food needs of the most vulnerable populations, including children
- other small-scale production-boosting measures based on countries’ individual needs – microcredit, investment, equipment, infrastructure and storage – and vocational training and support for agricultural professionals
Target countries and Regions
The Food Facility regulation provides that measures must benefit developing countries, as defined by OECD/DAC, and their populations (Article 1(2)). To optimise the impact of the regulation, resources are also to be concentrated on a limited number of high-priority target countries, identified on the basis of a set of indicative criteria laid down in the annex to the Regulation (Article 1(4)).
In addition to direct country-level support, the regulation makes reference to programmes of a regional or cross-border nature.
On the basis of the indicative criteria set out in the annex to the Food Facility Regulation, 50 priority countries should receive assistance from the Food Facility.
The Food Facility is a rapid response instrument and the delivery channels were chosen with this in mind. Most funds will be channelled through the International Organisations in the UN High Level Task Force on Soaring Food Prices. These organisations have existing frameworks for policy dialogue and assistance in place that can be easily supported and scaled up.
Over € 550M of the Food Facility funds are channelled through the international organisations. On 15 May 2009, the European Commission signed the first Contribution Agreements of the Food Facility with three UN implementing partners: FAO, UNRWA, UNICEF and on 26 May with WFP for a total of € 212 million. Similar contribution agreements with these international organisations, as well as with the World Bank, IFAD, UNDP and UNOPS, are expected to be finalised in a second phase.
In order to promote the involvement of the Non-State Actors and other relevant entities, such as the cooperation agencies of the EU Member States, in the implementation of the programme, the Call for Proposals has a budget of 200 M€.
A call for proposalsfor the amount of € 200M was launched on 26 May 2009. This call is targeting 35 developing countries selected from the 50 priority countries of the Food Facility. Potential applicants can include Non-State Actors (NGOs), public and parastatal bodies, private sector organisations, local authorities, consortia of representative organisations as well as financial institutions that grant, promote and finance private investment in the partner countries and regions. A public information session concerning the call was organised in Brussels on 27 May 2009: Presentation [759 KB]
For certain activities, there is a regional value added, such as trade facilitation, harmonisation of policies and regulations. These types of activities will be channelled through regional organisations, such as the Economic Community of West African States, for an amount of € 60 M.
Finally, one part of the programme will be implemented via national budgets of the beneficiary countries through budget support for an amount of € 165 million in the third phase.
Email us with your questions and queries concerning Food Facility (except those related to the call for proposals)