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UNCLAS SECTION 01 OF 02 BRUSSELS 000696 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAID EAGR ETRD EUN SOCI
SUBJECT: OVERVIEW OF THE EUROPEAN COMMISSION'S 1 BILLION 
EURO FOOD AID FACILITY 
 
REF: USEU BRUSSELS 01054 
 
BRUSSELS 00000696  001.2 OF 002 
 
 
 
¶1.  SUMMARY:  In early summer 2008 the European Commission 
(EC) 
proposed using leftover agriculture support funds to build a 1 
billion Euro (USD 1.3 billion) Food Facility to assist 
developing 
countries struggling under the weight of the international 
food 
price crisis. However, EU member states later blocked the EC's 
initial proposal to utilize surplus agriculture support funds, 
sparking a multi-month scramble for resources within the 
European 
Parliament (EP) and Council.  Parliament also lobbied for Food 
Facility funding to be additional to existing resources. 
Ultimately, member states together with Parliament finalized 
a 1 
billion Euro package on December 18, 2008.  Under this 
agreement, 
all but 240 million Euro (USD 317 million) that the 
Commission is 
providing to the facility comes from existing rather than new 
funding sources.  END SUMMARY. 
 
¶2.  The Facility will operate for three years (2009 - 2011). 
Assistance 
will focus on emergency-to-development transition periods and 
target 
programming to improve: 
 
- access to agricultural inputs, such as fertilizers and 
seeds, 
as well as services, such as the provision of vets and 
advisors; 
 
- small-scale measures aiming at increasing agricultural 
production, 
including microcredit, rural infrastructure, and training and 
support to 
professional groups in the agriculturalsector; and 
 
- safety nets through social transfers to vulnerable 
population groups. 
 
International organizations will receive roughly 
half of the anticipated one billion Euro that the EC is making 
available. 
 
¶3.  To date, the Commission has moved 708 million Euro 
through two 
different decisions in 2009.   The first tranche, for 314 
million 
Euro, covered 23 countries, including Afghanistan, Bangladesh, 
Burkina Faso, Burma, Burundi, CAR, DRC, Cuba, Eritrea, 
Ethiopia, 
Gambia, Guinea Bissau, Haiti, Honduras, Kenya, Liberia, Mali, 
Mozambique, Pakistan, Palestine, Philippines, Sierra Leone, 
and 
Zimbabwe.  Under this decision, the EC has already signed 
agreements 
with FAO for 106 million Euro, UNRWA for 39.6 million Euro, 
and 
UNICEF for 8.2 million Euro.  In addition, it will shortly 
finalize 
agreement with WFP for 38.7 million Euro and UNOPS for 10 
million 
Euro.  The World Bank, IFAD and UNDP are also expected to 
receive 
funding under this decision in the near future. 
 
¶4.  Subsequently, the EC is making available a second tranche 
worth 394 
million Euro, which in turn is divided into two different 
parcels. 
The first provides 194 million Euro for projects and programs 
in 23 
developing countries, including Benin, Bolivia, Burundi, 
Cambodia, 
Guatemala, Jamaica, Kenya, Kyrgyz Republic, Laos, Lesotho, 
Madagascar, Mozambique, Nepal, Nicaragua, Niger, Palestinian 
Territories, Philippines, Senegal, Somalia, Sri Lanka, Togo, 
Yemen 
and Zambia.  The second, valued at 200 million Euro and 
launched on 
May 26, 2009, will be for non-state actors such as NGOs and 
 
BRUSSELS 00000696  002.2 OF 002 
 
 
cover 35 
developing countries, including Benin, Bolivia, Burundi, 
Cambodia, 
Guatemala, Jamaica, Kenya, Kyrgyz Republic, Laos, Lesotho, 
Madagascar, Mozambique, Nepal, Nicaragua, Niger, Palestine, 
Philippines, Senegal, Somalia, Sri Lanka, Togo, Yemen, and 
Zambia. 
The first 314 million Euro and second 394 million Euro Food 
Facility 
funding actions contain five overlapping countries, namely 
Kenya, 
Burundi, Palestine, Philippines, and Mozambique. 
 
¶5.  With only 240 million Euro in additional funds, the 
majority of 
funding for the Food Facility now comes from existing EC 
budget line 
items.  Member states and Parliament earmarked emergency 
response 
budget allocations to supply the remaining 760 million Euro 
over the 
next three years, drawing specifically on the Emergency Aid 
Reserve 
(ordinarily managed by ECHO, the humanitarian assistance arm 
of the 
EC), the Flexibility Instrument (designed to respond to 
international emergencies), and on the Stability Instrument 
(ordinarily 
focused on security and post-conflict situations). 
 
¶6.  COMMENT:  The Commission initially had high hopes that 
the Food 
Facility would provide an immediate infusion of new capital 
to feed 
into the larger EU response to the food price crisis without 
having 
to draw on already existing budget line items.  Even though 
the 
Commission was not able to convince EU Member States to 
donate their 
surplus agriculture support funds to address the 
international food 
crisis, they were able to leverage their initial announcement 
and 
plans with the international media and donors.  The Commission 
referenced Food Facility plans through the end of 2008, 
providing 
much needed coverage from international criticism on the lack 
of 
resources for food security.  Ultimately, roughly 75 percent 
of the 
Facility's funds come from existing emergency response 
budgets, with 
the remaining 25 percent representing truly new resources. 
While 
drawing on these funds will inevitably hamper the EC's 
ability to 
respond to unforeseen emergency needs over the coming months, 
it 
does give them considerably more resources for programming 
specifically related to more long-term agricultural 
development. END COMMENT 
 
 
MURRAY 
.