26/02/2010 - Policy Principles for Food and Agriculture and Guidance Concerning the Strategic Orientation of Future Work to be Undertaken by OECD- (Text agreed by representatives of the OECD countries, the EU and of Chile, Estonia, Israel, Romania, the Russian Federation, and Slovenia).
1. When Ministers of Agriculture last met at the OECD in 1998, they agreed on a set of shared goals that summarised their aspirations for the economic health of the food and agriculture sector and for the contributions it should make to broader economic, social and environmental goals. Policy principles and operational criteria were defined as the benchmarks against which policies should be monitored and evaluated. Together, these elements provided a framework that has proved valuable in guiding the process of agricultural policy reform and in helping countries to develop better performing policies. All these elements remain valid today.
2. The past decade has been one of continuous change, significantly altering the environment in which the sector operates. The most recent years have been characterised by significant price volatility and a sharp rise in the numbers of malnourished people in the world. Coming years will also be characterised by economic, demographic, technological, market and environmental changes that will bring both opportunities and challenges to farmers, to food businesses, consumers and governments.
3. Recognising this, Ministers meeting in Paris in February 2010 agreed to build on and complement the policy principles agreed in 1998 acknowledging that the main priority is the need to provide an adequate supply of safe and nutritious food, on a sustainable basis, for the world’s growing population.
4. Specifically, Ministers recognised:
a) that an integrated approach to food security is needed involving a mix of domestic production, international trade, stocks, safety nets for the poor, and other measures reflecting levels of development and resource endowment, while, poverty alleviation and economic development are essential to achieve a sustainable solution to global food insecurity and hunger in the longer term;
b) that ‘green growth’ offers opportunities to contribute to sustainable economic, social and environmental development, that agriculture has an important role to play in the process, as do open markets that facilitate the sharing of technologies and innovations supportive of green growth, and that, in this context, care needs to be taken to avoid all forms of protectionism;
c) that climate change presents challenges and opportunities for the agricultural sector in reducing green house gas emissions, in carbon sequestration, and the need for adaptation;
and Governments should ensure that:
d) farmers and food suppliers, in developed and developing countries, are able to respond effectively to changing consumer and societal demand, and that the transmission of price signals along the food chain is improved locally, regionally and internationally;
e) the necessary institutional, regulatory and policy frameworks are in place to enable markets for food and agricultural products to function efficiently, effectively transparently and fairly;
f) appropriate policies are developed to facilitate the management of risk at the farm and farm household levels and throughout the agro-food sector, including, where appropriate, in response to the impacts of extreme price volatility on farmers, while maintaining an efficient distribution of responsibilities between private and public actors;
g) policies for the food and agriculture sector are coherent with general macroeconomic, trade, industrial, environmental, energy, consumer and social policies (including health and nutrition), and that there is coherence between country policies and efforts to assist developing countries;
h) trade play a role in matching global supply and demand, as a reliable source of supply for countries dependent on imports and a reliable outlet for competitive suppliers, through an efficient well-functioning rules-based multilateral trading system, to which an ambitious, balanced and comprehensive conclusion of the Doha Development Agenda would be an important contribution;
i) policies are supportive of the efforts of farmers and other participants in the supply chain to effectively manage natural resources to supply sustainably produced commodities;
j) incentives and disincentives can be effectively and transparently designed to reflect the total costs and benefits to society, with a view to improving environmental performance, in consistency with multilateral trade rules and commitments; facilitating adaptation to and mitigation of climate change; allowing the food and agriculture system to respond to resource pressures particularly those affecting land and water; reducing losses and waste in the food supply chain; ensuring the provision of public goods and services such as rural amenities, biodiversity, maintenance of landscape and land eco-system functions and contributing to the development of rural areas;
k) there is a supportive investment climate in particular with respect to foreign direct investment in emerging and developing countries, in line with internationally agreed guidelines;
l) innovation, including transfer of technologies, is fostered in order to increase productivity, enhance efficiency, improve sustainable resource use, respond to climate change and reduce waste including through balanced protection of intellectual property rights, and a regulatory environment conducive to innovation and new technology, and to public-private partnerships;
m) consumer protection is enhanced through further development and implementation of efficient, science-based food and feed safety standards, consistent with international agreements;
n) policies are explicitly connected to specific objectives or intended beneficiaries, while also limiting the administrative burden on the sector so that total costs to the public are minimised, and that policies are monitored and evaluated regularly for continued relevance, cost-effectiveness and efficiency.
Ministerial Guidance to OECD
5. Ministers emphasised that OECD’s work on food and agriculture should remain rooted in the OECD’s strategic objectives, among them to support sustainable economic growth, to foster global economic development, to raise living standards and to shape globalisation for the benefit of all through expansion of trade and investment.
6. Ministers noted the inclusive nature of these objectives and highlighted the importance of increased cooperation with countries outside the OECD and with other international institutions and agencies, including the G20. In this respect Ministers welcomed progress to date on OECD accession and the enhanced engagement programme with emerging economies, as well as collaboration with the FAO addressing the needs of less developed economies and with the WTO supporting a fair, rules-based multilateral trading system. Ministers also acknowledged the importance of the various international initiatives concerning food security, including the global Partnership for Agriculture, Food Security and Nutrition and encouraged OECD to continue to contribute to them.
7. Ministers expressed appreciation for OECD’s work on improving domestic, trade and agri-environmental policy performance, monitoring and evaluating farm policies, providing insights into the medium term outlook for agricultural markets. All these remain the important building blocks for continued work in the Committee for Agriculture.
8. Ministers noted that recent developments have brought a number of issues and questions confronting the global food and agriculture system into clear focus: strong growth in demand for feed, food and non-food uses of agricultural raw materials, alongside persistent global food security issues; climate change, exacerbated by increasing competition for land, water and other resources; price volatility; opportunities for “green growth,” with potential economic and environmental benefits; growing interest in the manner in which food is produced; food related health concerns; a renewed emphasis on innovation, efficient resource use and productivity growth, in both developed and developing countries, including the production of renewable energies such as bioenergy on a viable economic and environmentally sustainable basis; and, the essential role of trade in ensuring a sustainable and reliable flow of food and raw materials.
9. Ministers agreed that a deeper understanding of the nature, extent, and implications of these issues for the sector and for public policy choices is required and invited the OECD to explore these issues further over the medium and longer term, in cooperation with national governments and other relevant international organisations.
10. More specifically, Ministers asked the OECD Committee for Agriculture to contribute to a better understanding of the nature and magnitude of the challenges and opportunities facing the sector and to mainstream responses to them in its on-going core work. In this respect they requested that OECD:
(i) distinguish areas where farmers and the agro-food sector can address challenges and exploit opportunities on their own, from areas where government policy responses might be required;
(ii) harness OECD’s broad expertise and capacity for horizontal work to explore policy options that would contribute to growth and development, to poverty alleviation and to building global food security on a long term and sustainable basis, building also on experiences and expertise in the developing countries themselves;
(iii) identify policy options and market approaches that would encourage “green growth,” including mitigation of the food and agriculture system’s contribution to climate change, as well as adaptation to its impacts;
(iv) analyse the likely impact of climate change on agriculture and on agro-forestry, the role of the sector in mitigation and adaptation, and the appropriate policy responses;
(v) identify policy options and market approaches that allow the incentives faced by farmers, the agro-food sector and consumers to better reflect underlying social and environmental costs and benefits, including with respect to public and private goods and services of agriculture;
(vi) analyse the functioning of markets and the extent to which the changing physical and market environment is generating new or increased risk and volatility affecting the agriculture and food system, and define appropriate individual, market or public responses to manage risk; and ensure transparency and efficient functioning of markets.
(vii) explore ways in which public, private and public-private actions would improve innovation within the global food and agriculture system, with a view to increasing productivity growth, ensuring sustainable resource use, responding to demands from consumers and limiting waste;
(viii) explore how trade policy, on both the import and export side, can contribute to building global food security and sustainable resource use, paying particular attention to policies that might be needed to facilitate adjustment and to ensure outcomes that are equitable as well as efficient;
(ix) incorporate institutional and governance aspects into the monitoring and analysis of the policy reform process;
(x) provide a platform for high level policy dialogue, so that advice is as relevant and as practical as possible, taking advantage of the wealth of experiences across the OECD members and its collaborating partner countries;
(xi) ensure that established activities related to standard setting (Codes and Schemes) and to biological resources (Cooperative Research Programme) contribute to addressing identified challenges and opportunities;
(xii) ensure effective communication of relevant information, analysis and advice to the full range of stakeholders.
11. Finally, Ministers agreed that sustained responses would be required from the agro-food sector and from governments and that careful monitoring and analysis of progress would be essential. With this in mind, they agreed to come together again at OECD, not later than mid-decade, to take stock of progress.