A PROPOSAL FOR THE IMPLEMENTATION OF THE CARTA DI MILANO THE PRIVATE SECTOR STATEMENT TO WORLD SUMMIT ON FOOD SECURITY 2011 WORLD FOOD DAY/WEEK FOOD PRICES FROM CRISIS TO STABILITY INTERNATIONAL CONFERENCE THE SUSTAINABILITY OF FOOD SYSTEMS AND DIETS FOR STABILITY Rome, 24 th October 2011
Federalimentare took on this task in sharing with the other EU F&D Federations attending the Conference (France, Germany, Spain, UK) and with FoodDrinkEurope. Introduction 1. We as representatives of the private sector meeting in Milan consider that engagement of the private sector on food and nutritional security is critical to translate government commitments into implementation actions on the ground. The most effective way for the private sector to make its contributions is as part of an integrated, long term strategic approach that involves national governments, civil society, international institutions, development agencies and food chain partners. Main conclusions related to achieving food security 2. We consider that there is enormous potential to increase yields of farmers worldwide through access to knowledge, improved varieties, inputs, and markets. New farming and animal production techniques have to be successfully introduced enabling to raise productivity of agriculture and animal production for the delivery of food, feed and fibre. Sufficient funds, training and markets must be made available. Private sector companies are already working with farmers across the globe and can continue to play a key role in implementing programs to support and work with farmers. 3. We as representatives of the private sector recognize that smallholders represent a significant part of food production capacity worldwide, and that private sector actions to improve food security must include attention to enhancing the productivity, incomes and food security of smallholders. One of the surest ways to improve the food security and livelihoods of small farmers is to expand opportunities for them to increase value addition and sell high quality products in reliable markets. When possible, our companies will develop proactive procurement procedures targeting inclusion of smaller scale producers in value chains. Our initiatives to work with smallholders will have all the more impact if complementary actions are taken to build the capacities of small farmers to be reliable suppliers. 3.1 We suggest to strengthen the capacity of smallholder farmers by expanding dedicated extension services and financing programmes, enhancing access to reliable and transparent market price information, and supporting the formation and effective management of producers organizations and property rights through expanded public programmes, government incentives and public-private partnerships. These actions should be especially targeted to women smallholders in those countries or regions where they have a dominant role in agricultural production. We will consult with smallholder representatives as part of the stakeholder consultations at local level. 3.2 We want to improve the access to markets of smallholder farmers and stock breeders through investments in public infrastructure (particularly for transport and warehousing) as well as information access through cost effective information technology. We will develop risk-reducing solutions and training for smallholders through public and private partnerships at local level. Our medium-long term commitment is to increase the farmers size so they can produce at lower costs and be competitive. 4. While farm productivity improvements are essential, we would like to recall that it is important to think about the consumer as well as the farmer. Food supply chains in developing countries are very inefficient. The lack of post harvest controls and poor post-harvest management, logistics and handling practices create huge wastages and higher costs in food chains. If one can improve operational efficiency, minimize
logistics costs and reduce wastages, including through better storage and processing facilities, then a significant amount of food can be made available at affordable consumer prices. It is important as well to ensure the supply of nutritious, high quality and safe food because food security is not limited to adequate calories and protein alone the target is food and nutritional security through well balanced diets even for the poorest consumers. 4.1 Issues relating the sustainability of the food systems and diets for stability are also relevant for the private sector. In particular it is of paramount importance to focus on those diets with low environmental impacts which contribute to food and nutrition security and to a healthy life for present and future generations. Sustainable diets are protective and respectful of biodiversity and ecosystems, culturally acceptable, accessible, economically fair and affordable; nutritionally adequate, safe and healthy while optimizing natural human resources (Biodiversity & Sustainable Diets: An International Scientific Symposium). 4.2 We propose to increase availability of nutrient foods through consumeroriented strategies including research and development; improved safe storage and distribution strategies to increase access (especially in poor communities); and integrated production strategies linking agriculture, animal production, food safety, nutrition and health goals. 4.3 We suggest supporting the Scaling Up Nutrition (SUN) programme, led by the Special UN representative on Food Security and Nutrition, and invest in the core elements of the 1,000 critical days strategy. 4.4 We would like to encourage consumers to choose diets that offer a healthy nutritional balance as well as environmental efficiency, based on an integrated approach. This will have positive benefits on both human health and the environment. 5. The private sector is already contributing throughout the developing world to reducing, recycling, composting, re-using and managing waste on the way from farm to consumer, saving energy, creating new by-products from waste and to improving the quality and nutritional value of products. More needs to be done; the private sector is willing to be involved and with smaller and medium scale agricultural enterprises, including input suppliers as well as food manufacturers, distributors and retailers, in order to develop locally adapted solutions. 5.1 We think that it is important to significantly reduce post-harvest losses and food waste by investing in agricultural and livestock infrastructure and technology, and exchanging best practices for waste and loss reduction. Such efforts should engage both public and private sectors, taking a value chain approach to improving transport and distribution, storage, cold chain technology, energy efficiency, and waste recycling along the chain. Consumer food waste must be reduced through consumer outreach, improved technology, and incentives. 6. In order to achieve food security goals, the following issues must be addressed. Issues relating to ensuring sustainability 7. One important requirement for sustainable improvements in productivity and food security is markets that offer remunerative prices for farm products and affordable prices to consumers. The private sector can and does contribute to sustainability, food security and value addition by providing a viable and ready market for farm produce. We urge that the programs put in place to address food security should
include attention to establishing links between farms and markets on a sustainable basis. 7.1 For us environmental sustainability must be integrated as a core objective into all agricultural and livestock activities. This requires new approaches to climate, water, land use and waste issues through policy incentives, technology innovation, partnerships and best practices. 8. To establish these market linkages and value chains, we consider that urgent and substantial steps are needed to improve and ensure the sound management and maintenance of market-oriented agricultural infrastructure both hard and soft infrastructure. Attention is needed to transport infrastructure, including farm to market roads, electrification and safe water supply. We urge that national agricultural development plans and the programmes of international and regional financial institutions include strategies, priorities and resources for addressing infrastructure related constraints. 8.1 We would like to encourage sharing of non-competitive best practices and technologies for environmentally sustainable agricultural and animal practices, among private sector actors. 8.2 We would like to reduce greenhouse gas emissions from agriculture, leveraging incentives such as the Clean Development Mechanism (CDM) to include agricultural projects, and providing innovative financing for sustainable land use. 9. A key concern of most of our companies with respect to sustainability is support and maintain research involvement to improve efficiency of resource use in agriculture and animal production. We are convinced of the need to make rapid technological progress towards more productive knowledge intensive agriculture in order to ensure environmental sustainability in the context of climate changes and resource constraints. We believe that resource scarcities and resource use efficiency require particular attention. Growing water demand and scarcity is not only a challenge for future expansion of food production, but it puts even the supply for present world population at risk. Steps to ensure the efficient use of water thereby can play a pivotal role in reducing food insecurity. Attention is also need to biodiversity loss and other environmental pressures, soil depletion, land availability and use, social and economic constraints that could lead to spreading of political instability. 9.1 We would like to produce best practices for sustainable diet, recognising that the human health cannot be isolated from the healthy ecosystems, and that the conservation and sustainable use of food biodiversity is an important part of human and ecosystem well-being (Biodiversity & Sustainable Diets: An International Scientific Symposium). 9.2 We would like to encourage public-private collaboration to improve water resource management. This can include promoting fact-based, cost-effective water management (such as the World Economic Forum s Water Resources Group) and increasing investment in water capture, storage, distribution, and reuse, particularly in farming communities of developing countries. Public sector incentives, including the creation of investment funds and establishment of water pricing, can encourage the development of technologies and practices which improve the efficiency of water use in food production. Multilateral institutions can play an important role in jump-starting these efforts across regional boundaries. 10. Actions to improve the sustainability and efficiency of resource management in agriculture and animal production must as well taken into account risks and impacts due to volatility both price volatility as seen in 2007 and 2008 and climatic volatility
and change. Producers need training, appropriate technologies and sound resource management practices in order to cope with climate change and mitigate their risks in the face of high climatic and market volatility. 10.1 The private sector would like to address volatility in food commodity prices - in the short term by: opening global markets to food trade by successfully concluding the Doha Round, avoiding export restrictions, price controls and similar bans, as these will discourage the necessary additional investment required for agricultural production, impede access to agricultural raw materials and threaten food security, eliminating trade-distorting subsidies to ensure a level playing field in the global marketplace and avoiding limits on the use of technology which can hinder opportunities and deprive farmers of agricultural tools. - over the longer term by: ensuring cost-effective approaches to competition from other sectors for access to land, water, nutrients and energy sources, boosting innovation, education and capacity building to better mitigate and manage price volatility through improvement in agriculture distribution and storage systems, among others, focusing efforts on sustainable production and supply involving public-private collaboration and modern technologies integrated with local and traditional knowledge, as well as improving education and capacity building. 11. We in the private sector call on governments and other developmental partners to ensure that sustainability is established as one of the main goals of agricultural development assistance programs. We also urge that governments take steps to work with the private sector to help develop appropriate market mechanisms to address the lack of valuation of increasingly scarce natural resources such as water and soil. 11.1 In particular we want to implement market-based strategies to strengthen the productivity and sustainability of food systems, engaging a full range of private sector actors (from entrepreneurs/smes to large firms) and market mechanisms to address the needs of both producers and consumers Issues relating to food value chains and business practices 12. The private sector is committed to developing sustainable food value chains through our own operations as well as through partnerships. An ever growing number of our companies are giving priority to creating shared value in food chains - by conducting our business in a way that not only increases value for shareholders, but also for consumers, suppliers and other business partners, and communities at large where we are active. We will continue to increase the emphasis on sustainable food value chains as elements of our core business strategies. 12.1 We think that a 50% increase of investments in food value chains is needed by 2015. Public and private actors can achieve this by improving risk management and policy solutions to incentivize private investment, and fulfil previous commitments of public sector funding. 12.2 We could actively support pilot projects that demonstrate the effectiveness of increased investment and can lead to best practices applicable in a variety of growing regions. The public and private sectors can work together in individual countries to prioritize specific food value chains or regions for increased investment. 12.3 For the private sector good practices for regulation and governance in the environmental area are of fundamental importance also for preventing conflicts. Environmental impact assessments of significant new investments are important
to identify and prevent conflicts between economic development and the environment (draft Green Growth Strategy synthesis report, OECD). 13. We stand ready to invest meaningfully to help build national capacities in applied agriculture and food systems research and technology transfer in developing countries. We also recognize and embrace the need to take a longer term view of investment and business operations in developing regions, since the global challenge of food nutrition and security requires sustained commitment. 13.1 We would like to develop public-private partnerships for technology R&D and to expand technology access, enabling the private sector and public institutions to share technology and implement best practices, with a goal of addressing food security needs. They will remove existing hurdles with regard to the application of R&D and to support initiatives to encourage R&D investments which offer sustainable solutions. 13.2 We want to encourage consistent, well-formulated government policies to incentivize and manage technology development and the application of adequate food safety standards. Such effective policies are needed to manage new technology approvals, provide a clear and efficient regulatory environment, incentivize and support effective R&D and to assure consumers of the safety of the products. 13.3 We think that education, training and technology transfer should be enhanced for improving the food supply chain sustainability from farm to fork. We would like to remove the barriers that the neediest populations and their SMEs have to face in technology adoption and transfer, education accessibility, training opportunity. 14. While our companies, national and multinational, are committed to increasing investment in the food value chains of developing countries, there is a need for complementary innovative financing including through value chain financing, public private partnerships, catalytic funds, guarantee funds, and other financing mechanisms in order to enhance the capacities of small farmers and small and medium agricultural enterprises to actively engage in commercial agriculture. 14.1 We think that it is important to remove barriers to investment and establish investment enablers through joint action by public and private sectors. These could include catalytic financing measures (such as targeted low-cost loans, specific guarantee funds and matched grant facilities) to attract and leverage mainstream financing; development of patient capital to support demand-driven agricultural infrastructure needs; and credit guarantees and insurance programmes that reduce risk and promote investment across the entire agriculture and livestock value chain. Multilateral institutions are particularly wellsuited to working with both public and private sector actors to increase the speed of implementation. 14.2 We would like to underline the importance of encouraging governments to work with industry to develop intellectual property protection policies to enable private sector investments and innovations in markets currently lacking such frameworks. 15. One of the private sector's main roles in reducing food insecurity, especially in developing countries, is to provide agricultural inputs in an efficient, cost effective and sustainable manner. In order for input supply companies to play this important role, there is a need to establish and maintain appropriate infrastructure and
institutions for technology dissemination and inputs distribution. Intellectual property protection is crucial for a sustainable contribution of the private sector to inputs development and supply. Issues relating to partnerships and enabling policies 16. We would like to emphasize that the many possible initiatives the private sector might undertake can only be effective within a broad strategy that brings together all stakeholders. We consider that strong partnerships are critical, and that there are important untapped opportunities for partnerships involving farmers, the food industry, governments, international organisations, NGOs, and donors. Capacity to create partnerships and coordinate action at the local level in support of entrepreneurship, farming and livestock as a business must be reinforced. The private sector can contribute but cannot do this alone. All stakeholders need to commit to collaboration and partnership. Ideological barriers that have impeded such partnerships in the past must be overcome. 17. In our efforts to enhance productivity and develop sustainable value chains in partnership with other stakeholders, we in the private sector count very much on government cooperation. National governments in particular have a central role in creating the right stimulus and regulatory conditions to unleash the potential of the land and the private sector, including farmers. Governments must create an enabling environment through science-based regulation, increased investments on R&D as well as agricultural extension support and infrastructure development and optimization. We in the private sector would like to see strong commitments by governments to establishing fair, transparent and predictable regulatory frameworks so both local and international companies can confidently invest along the whole food chain, despite global political and economic crisis. 17.1 It is important to strengthen agriculture, animal production and nutrition science in institutions of developing countries through public-private partnerships, and school/academy. 18. We urge that progress continue on negotiations to reduce market barriers and market distorting incentives, and also urge governments to resist the pressures during times of short term crisis to impose export and import restrictions that undermine confidence and reduce incentives needed to mobilize the resources, technologies and expertise for developing sustainable value chains. 18.1 It is important to establish transparent monitoring and data sharing services through public-private collaboration to provide accurate and timely information on availability, stocks, demand, price and quality criteria. The private sector will contribute to the initiative to set up a global framework for food security data by providing expertise. 19. We in the private sector consider that there is a clear need for policy change, realistic priority setting based on understanding of market trends and requirements, and improved inter-institutional cooperation at the very top levels of the international agriculture and food security organizations in order to provide the necessary enabling environment and multi-stakeholder partnerships for sustainable growth of the sector. 20. Finally, the companies and entrepreneurs we represent are action oriented. It is important to translate the good intentions expressed during this Summit into concrete actions and timelines for implementation. We call on and stand ready to work with FAO, IFAD and WFP, our own food industry federations, and important platforms such as the Expo Milan 2015 and the World Economic Forum to promote, coordinate and facilitate global and local actions leading to improved food and nutritional security.
EXECUTIVE SUMMARY GENERAL AIMS - Achieving food security - Ensuring sustainability - Developing sustainable food value chains and business practices - Creating partnerships and coordinate action at the different levels STRATEGIC INTENTS - Enhancing the productivity (agriculture and animal production), incomes and food security of smallholders - Making a significant amount of nutritious, high quality and safe food available at affordable consumer prices - Reducing, recycling, composting, re-using and managing waste on the way from farm to consumer, saving energy, creating new by-products from waste - Improving water resource management - Achieving a sustainable economic and social development of agricultural production - Addressing the volatility in commodity prices SOCIAL RESPONSIBILITY PLANNING - Improving production - Technology transfer - Education - Training - Improving the access to markets - Improving operational efficiency - Minimizing logistics costs - Reducing wastages, including through better storage and processing facilities - Producing best practices for sustainable diets - Increasing the investments - Developing public-private partnerships for R&D COMMUNICATION EXPECTED RESULTS - Increasing investments - Improving markets - Accelerating R&D investment and expanding technology access - Ensuring environmental sustainability - Meeting nutritional needs - Reducing the volatility in commodity prices