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Report to the Ranking Minority Member, Subcommittee on African Affairs, 
Committee on Foreign Relations, U.S. Senate:

June 2003:

Foreign Assistance:

Sustained Efforts Needed to Help Southern Africa Recover from Food 
Crisis:

GAO-03-644:

GAO Highlights:

Highlights of GAO-03-644, a report to the Ranking Minority Member, 
Subcommittee on African Affairs, Committee on Foreign Relations, 
United States Senate 

Why GAO Did This Study:

Southern Africa has been facing its worst food crisis in more than a 
decade, threatening more than 15.3 million people in six countries 
(Lesotho, Malawi, Mozambique, Swaziland, Zambia, and Zimbabwe) with 
famine. Because of concerns over the nature and severity of the 
emergency, GAO was asked to look at (1) what factors contributed to 
the crisis,( 2) how well were affected populations’ needs met, (3) 
obstacles to the food aid effort, and (4) challenges to emerging from 
crisis to sustained recovery.

What GAO Found:

* Multiple factors contributed to the food crisis. Erratic weather 
reduced maize (corn) production. A poorly functioning agricultural 
sector caused food supply shortages, and government actions--including 
the sale of Malawi’s grain reserve and Zimbabwe’s land reform--further 
cut available food. Widespread poverty contributed to food insecurity. 
Finally, the HIV/AIDS epidemic exacerbated food shortages by, among 
other things, reducing the labor force. 

* Food needs were not fully met but famine was averted. Food aid was 
sufficient to avert a famine, but the overall response did not prevent 
widespread hunger. About 93 percent of the total cereala gap--the 
difference between domestic cereal needs and production--was met by 
the end of the April 2002-March 2003 crisis period. However, food aid 
deliveries fell substantially short in several countries, and 
vulnerable households had limited ability to purchase commercial 
supplies when available.

Plan for Addressing Cereal Needs in the Six Countries

[See PDF for image]
 
[a] Cereal includes maize and other grains suitable for food.

[End of figure]

* Slow donations, poor infrastructure, and concern about the safety of 
biotech food were major obstacles to an effective response. Excluding 
the United States, most donors did not make sufficient, timely 
donations to the World Food Program (WFP). Poor ports, roads, 
railroads, and storage facilities hampered efficient food delivery. 
One country rejected food aid because of concerns regarding biotech 
food; most others required milling of whole kernel maize for the same 
reason. This severely compromised the food aid pipeline because the 
United States was the region’s key donor and most of its aid could 
contain biotech food. 

* Declining investments in agriculture and the HIV/AIDS epidemic pose 
challenges to emerging from crisis into sustained recovery. U.N. and 
U.S. officials cite the need to reverse declining trends in 
agricultural investments by international financing organizations, 
national governments, and donors. They note that without a concerted 
strategy that integrates, among other things, agricultural 
development, the impact of HIV/AIDS, and natural disaster management, 
destabilizing food crises are likely to recur.

What GAO Recommends:


GAO recommends that the Secretaries of State and Agriculture and 
Administrator of the U.S. Agency for International Development 
(USAID)

* initiate a comprehensive review of the issues associated with 
biotech foods in emergency food aid—including environment, health, and 
trade concerns—in anticipation of future food crises; and

* work with international donors and national governments on a 
recovery strategy integrating, among others, agricultural development, 
HIV/AIDS, and natural disaster management.

We received comments from the Departments of State and Agriculture, 
USAID, and WFP, all of which generally agreed with our conclusions and 
recommendations. They also provided technical comments, which we 
incorporated as appropriate.

www.gao.gov/cgi-bin/getrpt?GAO-03-644.

To view the full report, including the scope and methodology, click on 
the link above. For more information, contact David Gootnick (202) 512-
3149 (gootnickd@gao.gov).

[End of section]

Letter:

Results in Brief:

Background:

Multiple Factors Contributed to the Food Crisis:

Food Needs Not Fully Met, but Famine Was Averted:

Slow Donations, Poor Infrastructure, Concerns Associated with Biotech 
Food Were Major Obstacles to an Effective Response:

Declining Support for Agricultural Sector and the HIV/AIDS Epidemic 
Pose Challenges to Emerging from Crisis into Sustained Recovery:

Conclusions:

Recommendations for Executive Action:

Agency Comments and Our Evaluation:

Appendixes: 

Appendix I: Scope and Methodology:

Appendix II: Timeline of the Southern Africa Food Crisis:

Appendix III: Early Warning Systems and Vulnerability Assessment
Methods:

Early Warning Systems:

Assessment Systems:

Appendix IV: U.S. Donations:

Appendix V: Commercial Imports:

Appendix VI: Nonfood Emergency Needs:

Appendix VII: Biotech Food and the Southern Africa Food Crisis:

Modern Agricultural Biotechnology:

Appendix VIII: Comments from the Department of State:

GAO Comments:

Appendix IX: Comments from Department of Agriculture:

GAO Comments:

Appendix X: Comments from the U. S. Agency for International
Development:

GAO Comments:

Appendix XI: Comment from the World Food Program:

GAO Comments:

Appendix XII: GAO Contacts and Staff Acknowledgments:

GAO Contacts:

Acknowledgments:

Tables :

Table 1: Cereal Production by Country:

Table 2: Frequency of Household Coping Strategies in Zambia (August 
through December 2002):

Table 3: Contributions to WFP and Their Timing:

Table 4: U.S. Government Food Aid Response to the Southern Africa 
Crisis:

Figures: 

Figure 1: Population at Risk of Famine in the Affected Southern
African Countries:

Figure 2: Revised Estimate of the Cereal Gap in the Six Countries
and Plan for Addressing the Deficit (March 2003):

Figure 3: Extent to Which Cereal Food Aid and Commercial
Imports Met the Cereal Gap (April 1, 2002, through March
31, 2003):

Figure 4: Extent to Which WFP Monthly Food Delivery Targets
Were Met (July 2002 through March 2003):

Figure 5: Percent of WFP Total Planned Beneficiaries Who
Received at Least Some Food Aid (July through December 2002):

Figure 6: Steps in the Logistics Process:

Figure 7: The Transportation Network for Moving Food in the Region:

Figure 8: Agricultural Lending by the World Bank, the African
Development Bank, and the International Fund for Agricultural 
Development–1990 through 2000:

Figure 9: World Bank Agricultural Sector Loans Approved for the
Affected Countries–1990 to 2002:

Figure 10: Agricultural Spending as a Percentage of Total
Government Spending– 1996/97 through 2001/02 (in 2003 dollars):

Figure 11: USAID Bilateral Assistance in the Agricultural Sector to
Four Countries–1998 to 2003:
 
Figure 12: Examples of Existing Programs Related to Food Security:

Figure 13: Projected Impact on GDP Due to HIV/AIDS:

Figure 14: Timeline of the Southern Africa Food Crisis:

Figure 15: U.N. Nonfood Emergency Appeals and Contributions by 
Sector:

Abbreviations :

CFSAM: Crop and Food Supply Assessment Mission:

C-SAFE: Consortium for the Southern Africa Food Security Emergency:

EMOP: Emergency Operations:

EWS: early warning systems:

FAO: Food and Agriculture Organization:

FEWS NET: Famine Early Warning Systems Network:

GIEWS: Global Information Early Warning System:

IFAD: International Fund for Agricultural Development:

IFPRI: International Food Policy Research Institute:

IMF: International Monetary Fund:

NGO: nongovernmental organization:

OFDA: Office of Foreign Disaster Assistance:

SADC: Southern African Development Community:

UNAIDS: Joint United Nations Program on HIV/AIDS:

UNICEF: United Nations Children's Fund:

USAID: United States Agency for International Development:

USDA: United States Department of Agriculture:

VAC: vulnerability assessment committee:

VAM: vulnerability assessment mapping:

WFP: World Food Program:

WHO: World Health Organization:

Letter June 25, 2003:

The Honorable Russell D. Feingold 
Ranking Minority Member 
Subcommittee on African Affairs 
Committee on Foreign Relations 
United States Senate:

Dear Senator Feingold:

The southern Africa region has been facing its worst food crisis in 
more than a decade. Approximately 15.3 million people (26 percent of 
the total population) in 6 countries--Lesotho, Malawi, Mozambique, 
Swaziland, Zambia, and Zimbabwe--have experienced severe food shortages 
and the threat of famine. Avoiding famine has required substantial 
supplies of food from commercial imports[Footnote 1] and a large 
international food aid effort. The United Nations began establishing 
emergency food aid operations in individual countries as early as 
November 2001. In July 2002, the United Nations appealed to 
international donors for $507 million to provide 1.2 million metric 
tons of emergency food aid as part of a consolidated regional program 
for the April 2002-March 2003 crop year. However, food shortages 
continue and emergency operations have been extended through June 2003.

Because of concerns over the nature and severity of this food crisis, 
you asked us to determine: (1) what factors contributed to the current 
crisis in southern Africa, (2) how well were the populations' overall 
food needs met during the crisis period, (3) what were the major 
obstacles to the food aid effort, and (4) what are the challenges to 
emerging from the crisis into sustained recovery.

To address these objectives, we met with and analyzed information from 
U.S. government officials at the U.S. Agency for International 
Development (USAID) and the Departments of State and Agriculture in 
Washington, D.C., and at U.S. missions in Botswana, Malawi, Mozambique, 
Zambia, Zimbabwe, and South Africa. We also met with officials and 
reviewed information from the World Food Program (WFP), the Food and 
Agriculture Organization (FAO), and the International Fund for 
Agricultural Development (IFAD) at their headquarters in Rome and in 
the southern African countries we visited. In addition, we gathered 
information from and met with representatives of the World Bank and the 
International Monetary Fund (IMF), other U.N. agencies, nongovernmental 
organizations (NGO), other donor governments, and host government 
ministries in Washington and at the country level in southern Africa. 
As part of our fieldwork, we observed WFP and NGO food aid 
distributions in Malawi, Mozambique, Zambia, and Zimbabwe. (App. I 
provides detailed information on our scope and methodology.):

Results in Brief:

The primary factors that contributed to the food crisis were: (1) 
erratic weather, (2) a poorly functioning agricultural sector, (3) 
questionable government actions, (4) widespread poverty, and (5) the 
HIV/AIDS epidemic. Erratic weather patterns contributed to a reduction 
in southern Africa's cereal[Footnote 2] production by 29 percent on 
average.[Footnote 3] But this decline alone would not have caused a 
food crisis absent other conditions. Food stocks were depleted from 
previous poor harvests and farmers lacked access to agricultural inputs 
such as seeds and fertilizer. Government actions such as the sale of 
grain reserves in Malawi and disruptive land reform policies in 
Zimbabwe--which spurred a 75 percent drop in that country's commercial 
maize (corn) production over the past 2 years--further reduced food 
supply. Widespread poverty contributed to food insecurity in the 
region. HIV/AIDS, which has infected 13 percent to 33 percent of the 
population in the six countries, exacerbated the crisis by reducing 
both productivity and agricultural output and severely limiting the 
populations' ability to cope with a bad harvest and high food prices.

By the end of the April 2002-March 2003 crisis period, approximately 93 
percent of the regional cereal gap[Footnote 4] was met. Commercial 
cereal imports were reported as 1.72 million metric tons (MT), while 
the food aid effort achieved at least 0.73 million MT (60 percent of 
the planned amount). Provision of this food prevented large-scale 
famine and death. However, food did not reach the region early enough 
to avert widespread hunger, and many people resorted to rationing food, 
reducing expenditures on nonfood items, and selling household assets 
(such as tools and livestock). Success in filling the total cereal gap 
varied widely across the six affected countries. For example, Malawi 
more than eliminated its cereal gap, whereas Mozambique cut its gap by 
about 50 percent. According to currently available data, rates of acute 
malnutrition in the region have not deteriorated significantly.

The major obstacles to the food aid effort were (1) the lack of 
sufficient, timely food donations; (2) poor infrastructure in recipient 
countries; and (3) concerns associated with biotech food.[Footnote 5] 
Although the United States made substantial, early donations, in 
aggregate, donor country commitments of food were 18 percent below 
operational needs through the end of December. Moreover, given 
the lag in time between when food commitments were made and when food 
arrived in country, the shortfall in the first 6 months of the crisis 
period was much higher. Poor infrastructure--ports, rail, roads, and 
storage facilities--in recipient countries hampered efficient delivery 
of food aid, limited how quickly food could reach recipients, and 
ultimately prevented food from reaching some beneficiaries. Concerns 
about the health and environmental safety of food aid that might 
contain bioengineered products led Zambia to reject U.S.-donated maize 
and most of the other countries to impose costly and time-consuming 
processing requirements--which further reduced or delayed the food aid 
effort, increased costs, and complicated emergency operations.

The major challenges to emerging from the current food crisis into 
sustained recovery include (1) declining investment in the region's 
agricultural sector, (2) the limited scope of existing programs related 
to food security,[Footnote 6] and (3) the negative impact of HIV/AIDS. 
Recognizing that little progress has been made to address impediments 
to the transition from crisis to recovery, the U.N. Secretary-General 
and several other key stakeholders have called for a more 
comprehensive, integrated approach to break the pattern of recurrent 
food crises in Africa. While the food outlook for the next crop year--
April 2003 through March 2004--is better, food security conditions are 
still tenuous; and without sustained progress, recurring food crises 
may be difficult to avoid in the future.

This report makes recommendations to the Secretaries of State and 
Agriculture and the Administrator of USAID, to (1) undertake a 
comprehensive review of the issues pertaining to biotech foods in 
emergency food aid in anticipation of future food crises, and (2) work 
with international organizations, donors, national governments, and key 
stakeholders to develop a recovery strategy that integrates 
agricultural development, HIV/AIDS, and natural disaster management, 
among other things.

We received written comments on a draft of our report from the 
Departments of State and Agriculture, USAID, and WFP, which we have 
reprinted in appendixes VIII, IX, X, and XI, respectively. These 
agencies generally agreed with our overall conclusions and 
recommendations while expressing technical concerns on specific points, 
primarily issues related to biotech food. Their technical comments, 
along with those received from FAO, IMF, and the World Bank, have been 
incorporated into the report as appropriate.

Background:

In 1991/92, drought caused massive crop failure, threatening 18 million 
people in 10 southern African countries with famine. Because of a 
similar reduced maize crop after the 2001/02 crop cycle,[Footnote 7] 
several early warning systems predicted an impending food crisis that 
would run through the beginning of the following harvest in April 2003. 
(App. II provides a timeline of the crisis period, and app. III 
provides information on early warning systems.):

Regional and national assessments of the crisis conducted by WFP, FAO, 
and others estimated that 15.3 million people[Footnote 8] in the region 
were at risk of starvation. (Fig. 1 shows the population at risk of 
famine in each of the six affected countries.):

Figure 1: Population at Risk of Famine in the Affected Southern African 
Countries:

[See PDF for image]

[End of figure]

In July 2002, WFP initiated the Southern Africa Crisis Response 
Emergency Operation (EMOP) for providing food aid to the six countries 
on a regional basis. Prior to this consolidation, WFP had been 
delivering food to the individual country emergency operating programs. 
objectives in the southern Africa food crisis were to prevent 
severe food shortages, safeguard the nutritional well-being of 
vulnerable segments of the population, preserve human assets, and 
prevent migration out of affected areas.

As the major food aid donor in the southern Africa crisis, the U.S. 
government has a significant role in the relief effort. Through USAID's 
Food for Peace Office and its Office of Foreign Disaster Assistance and 
USDA, the U.S. government has worked to support the EMOP and address 
the crisis. In February 2002, in an effort to avert famine, the United 
States began authorizing food aid shipments to the region. As of March 
18, 2003, the U.S. government had provided approximately $275 million 
in food aid and $13 million for bilateral nonfood-related assistance 
such as agriculture, health, shelter, and sanitation. (See app. IV for 
additional information on the U.S. contributions.):

WFP, the United States, and other countries partner with 
nongovernmental organizations to distribute food aid at the regional 
and village level. In addition, many of these organizations also 
provide nonfood emergency assistance and long-term development 
aid.[Footnote 9]

Much of the population in each of the affected countries works in the 
agricultural sector. The percentage of labor force engaged in 
agriculture ranges from 66 percent in Zimbabwe to 86 percent in Lesotho 
and Malawi. Many of these farmers rely on maize (corn) as the primary 
staple crop. Unlike root crops such as cassava and sweet potatoes--
which are common but less popular staples in the region--maize is 
relatively fragile, requiring more fertilizer and differing amounts of 
water during the growing season.

Multiple Factors Contributed to the Food Crisis:

The immediate factor contributing to the food crisis was the erratic 
weather patterns that disrupted the normal growing cycle, causing maize 
production in southern Africa to drop from a 5-year average of about 
7.3 million MT to about 5.2 million MT in 2002. The dramatic reduction 
in available maize can also be linked to a weak agricultural sector and 
government actions, such as Malawi's decision to sell off its strategic 
grain reserve and Zimbabwe's fast-tracked land reform. In addition, 
much of the region's population had limited access to food because of 
widespread poverty. The HIV/AIDS epidemic further exacerbated the 
population's access to basic commodities by decreasing household food 
production and income and increasing consumption requirements.

Erratic Weather Patterns Played a Key Role in Reducing Maize 
Production:

Erratic weather patterns between December 2001 and May 2002 reduced the 
harvests in five of the six affected countries, except Mozambique, when 
compared with 5-year averages. Drought-like conditions gripped parts of 
Malawi, southern Mozambique, Swaziland, southern Zambia, and Zimbabwe 
in the middle of the growing season (see app. II for timeline). This 
water deficit at a crucial point in the growing season severely 
stressed crops and caused many hectares[Footnote 10] to wilt. In 
addition, parts of Zambia suffered high rainfall mid-season, flooding 
the still-growing crops. Similarly, in Malawi, after the mid-season dry 
spells wilted some crops, the country received heavy rains that 
hampered the harvesting and drying of what crops remained, and in some 
cases, caused them to rot. Lesotho also experienced prolonged rains 
late in the season as well as an additional late-season frost that 
damaged crops across large parts of the country and drastically reduced 
production.

Regional Cereal Production Dropped by 29 Percent:

Regional food supplies have been limited due to poor cereal harvests in 
five out of the six affected countries. (See table 1.) Mozambique was 
the one exception: Its 2001/02 cereal harvest was actually above 
average. However, due to transportation constraints, Mozambique's 
production surpluses could not be supplied to the southern part of the 
country where cereal harvests were lower.

Table 1: Cereal Production by Country:

In metric tons:

Lesotho; 2001/02 season: 121,500; 5-year average[A]: 171,000[B]; 
Percentage change: -29%.

Malawi; 2001/02 season: 1,772, 000; 5-year average[A]: 2,081,000; 
Percentage change: -15%.

Mozambique; 2001/02 season: 1,767,000; 5-year average[A]: 1,678,000; 
Percentage change: 5%.

Swaziland; 2001/02 season: 70,000; 5-year average[A]: 90,000; 
Percentage change: -22%.

Zambia; 2001/02 season: 738,000; 5-year average[A]: 1,095,000; 
Percentage change: -33%.

Zimbabwe; 2001/02 season: 705,840; 5-year average[A]: 2,164,000; 
Percentage change: -67%.

Total; 2001/02 season: 5,174,340; 5-year average[A]: 7,279,000; 
Percentage change: -29%.

Source: Famine Early Warning Systems Network (FEWS NET) Vulnerability 
Assessment Committee (VAC) Reports, September 2002 through January 
2003.

[A] Represents average production for the harvests in 1997 through 
2001.

[B] Estimated.

[End of table]

Poorly Functioning Agricultural Sector Negatively Affected Food Supply:

In addition to poor weather conditions, weaknesses in the agricultural 
sector contributed to a poor harvest. According to IFAD, these 
weaknesses included the following:

* Declining soil fertility reduced crop yields. In Lesotho, average 
maize and sorghum yields have declined by more than 60 percent since 
the mid-1970s. According to FAO, declining soil fertility is a primary 
cause of this trend and is leading to a crop production catastrophe in 
that country.

* Restricted access to agricultural inputs such as seeds and fertilizer 
limited harvests. In Zambia, important inputs such as seeds and 
fertilizer were not available until December 2001 or January 2002, 
resulting in late plantings. These crops were at a crucial stage of 
development when the rains ceased in early 2002, causing crop failure.

* Incomplete market development impaired farmers' ability to sell 
crops. In Malawi, market reforms of the 1980s and 1990s eliminated 
price controls and removed government food grain monopolies. While 
these liberalizing reforms increased the availability of seeds and 
fertilizer, small farmers still lack access to credit.

Recent Government Actions Further Reduced the Food Supply:

The food supply has been constrained further by certain government 
actions, the most damaging of which were the sale of grain reserves in 
Malawi and fast-tracked land reform in Zimbabwe.

Sale of Malawi's Grain Reserve Hindered Stable Food Supplies:

Between July 2000 and August 2001, the National Food Reserve Agency of 
Malawi sold the 167,000 MT of maize it had purchased and stored as food 
reserves for the country. Despite several audits, it is still uncertain 
where the proceeds of the sale went. While the sold reserves did not 
cause the Malawi food crisis, their absence jeopardized the 
population's food security. Had the government retained 60,000 MT of 
maize in accordance with its own policy to ensure adequate food 
supplies or an equivalent amount of currency to purchase new stocks, it 
could have been used to help ease food shortages in the early stage of 
the crisis, when a considerable number of people are reported to have 
died,[Footnote 11] and to fill almost one-quarter of the country's 
cereal gap while emergency response operations were ramping up.

An investigation by Malawi's National Audit Office in May 2002 
concluded that the National Food Reserve Agency lost money in every 
area of handling maize because of poor financial management. Another 
investigation, conducted by Malawi's Anti-Corruption Bureau in mid-
2002, found that poor management of the grain reserve allowed companies 
and individuals to take advantage of the maize shortage to increase 
prices beyond the reach of a large sector of the community. The 
mismanagement cost the Malawian government more than K 2.9 billion 
(about $40 million).[Footnote 12]

Zimbabwe's Land Reform Decimated Production and Strained Region's 
Supply:

After years of trying to redistribute the country's arable land, the 
government of Zimbabwe fast-tracked its land reform and resettlement 
policy in 2000 with the aim of acquiring all commercial farms no later 
than August 8, 2002. The campaign was characterized by the forced 
expulsion of landowners and farm laborers. To date, there remain more 
than a million internally displaced farm laborers. While the government 
did acquire these farms, it did not maintain them to ensure continued 
productivity. As a result, the land seizure destabilized the country's 
economy, leading to a 75 percent drop in commercial maize production 
over the past 2 years and turning Zimbabwe from a net exporter of grain 
to a net importer. Because Zimbabwe now cannot grow enough food to feed 
its own population, it has strained the cereal supply for the entire 
region.

According to the State Department, the country's gross domestic product 
fell by more than 20 percent and inflation soared to more than 269 
percent between 1998 and 2002, coinciding with fast-tracked land 
reform. At the same time, unemployment rose by more than 25 percent as 
dismantling of commercial farms left many rural farm workers without a 
source of income and, therefore, a way to purchase food when their 
subsistence crops failed. In addition, government-imposed price 
controls on basic commodities have caused shortages of everything from 
bread, milk, sugar, and wheat flour to fuel and electricity.

Widespread Poverty Contributed to Food Insecurity:

The six nations affected by the food crisis are generally low-income 
countries. The percentage of population subsisting on less than $1 per 
day range from 36 percent in Zimbabwe to 64 percent in Zambia. This 
widespread poverty and lack of productive assets (e.g., livestock and 
farm machinery) contribute to food insecurity in the region. In 
addition, the region is currently facing serious economic problems that 
further increase the population's food insecurity. For example, in 
recent years, the dramatic collapse in the economy of Zimbabwe and a 
decline in the mining industry in South Africa and Zambia have removed 
sources of employment for many individuals in the region. The region's 
food insecurity is associated with high rates of chronic malnutrition 
in the under-5 population--ranging from 30 percent in Swaziland to 59 
percent in Zambia.

HIV/AIDS Epidemic Exacerbated Food Shortages:

The HIV/AIDS epidemic has strained already-diminished food supplies by 
decreasing affected households' food production and increasing 
nutritional requirements. In addition, the epidemic limits households' 
access to food by decreasing income and increasing household expenses. 
According to the Joint United Nations Program on HIV/AIDS (UNAIDS), 
adult HIV/AIDS infection rates in 2001 were approximately 31 percent 
for Lesotho, 15 percent for Malawi, 13 percent for Mozambique, 33 
percent for Swaziland, 22 percent for Zambia, and 34 percent for 
Zimbabwe. Infection rates are higher among women, who generally account 
for 70 percent of the agricultural labor force and 80 percent of food 
production in Africa.

HIV/AIDS Reduces Food Supplies:

HIV/AIDS has decreased household food production by attacking people in 
their most productive working years, thus reducing the labor force. 
Around three-fourths of HIV/AIDS cases in southern Africa are among 
adults between the ages of 20 and 40. The percentage of agricultural 
labor force lost due to HIV/AIDS deaths by 2000 was nearly 6 percent 
for Malawi and 10 percent for Zimbabwe. Recent studies on specific 
rural areas show, for example, that each adult death in Zambia was 
associated with a 16 percent reduction in the amount of land planted by 
the household, and 72 percent of households affected by chronic illness 
in selected rural areas of Malawi experienced an agricultural 
production decrease.[Footnote 13] In addition, a person infected with 
HIV/AIDS requires up to 50 percent more protein and 15 percent more 
calories than a noninfected person. These extra needs put a further 
strain on the already limited food supplies.

HIV/AIDS Decreases Access to Food:

HIV/AIDS has lowered household incomes, making it more difficult to 
access what food is available. Recent studies estimate that GDP growth 
in southern Africa is currently around 1 percent to 2 percent lower due 
to HIV/AIDS.[Footnote 14] For the six affected countries, 1 percent of 
GDP in 2001 amounted to around $200 million. Recent studies in the 
region also show large monetary impacts at the household level. For 
example, in Zambia, HIV/AIDS-affected households reported annual income 
levels of 30 percent to 35 percent less due to the disease. In 
Zimbabwe, households with orphans had 42 percent less income per capita 
than households without orphans. In addition, medical care and funeral 
expenses are significant: In Zambia, 42 percent of households with 
chronically ill members reported unusually high health care expenses 
compared with 14 percent of households without chronically ill members, 
while in Zimbabwe, funeral costs can be as much as twice the annual per 
capita poverty line.

Food Needs Not Fully Met, but Famine Was Averted:

By the end of the April 2002-March 2003 crisis period, approximately 93 
percent of the regional cereal gap appeared to have been met.[Footnote 
15] Commercial cereal imports were reported as 1.72 million MT, while 
the food aid effort achieved at least 0.73 million MT (60 percent of 
the planned food aid amount). The commercial cereal imports and food 
aid prevented large-scale famine and death but did not reach parts of 
the region early enough throughout most of the crisis period to avert 
widespread hunger. Many people resorted to coping mechanisms, such as 
rationing their food intake, reducing their expenditures on nonfood 
items, and selling household assets to obtain food. The limited data 
available on nutritional status generally do not show a significant 
impact on acute malnutrition in the countries of the region. In 
addition to problems with timely delivery of food, U.N. agencies were 
only able to fund about 25 percent of urgent, nonfood emergency 
humanitarian needs.

Approximately 93 Percent of the Cereal Gap Met during the Crisis 
Period:

The May/June 2002 FAO/WFP crop and food supply assessments (CFSAM) for 
each of the six countries estimated the cereal gap for the region at 
4.1 million MT or 43 percent of domestic requirements for the April 1, 
2002, through March 31, 2003, period. However, by the end of March 
2003, the cereal gap had been revised downward substantially---to 2.6 
million MT or 31 percent of domestic requirements.[Footnote 16] Based 
on the plan that evolved from the CFSAMs, the cereal deficit was to be 
offset by a combination of commercial imports and emergency food aid. 
The assessments identified an emergency cereals need of 1.2 million MT 
for the crop year, and this amount was adopted as a goal in the United 
Nations' July 2002 emergency appeal for food aid for the region. 
Although later analyses projected more people at risk of famine, the 
goal for emergency cereals needs was not increased. As shown in figure 
2, if the emergency goal of 1.2 million MT were fully met, the 
estimated need for commercial cereal imports would be 1.4 million 
MT.[Footnote 17]

Figure 2: Revised Estimate of the Cereal Gap in the Six Countries and 
Plan for Addressing the Deficit (March 2003):

[See PDF for image]

[End of figure]

Figure 3 indicates the extent to which food aid and commercial imports 
helped offset the cereal gap in each country and the region over the 
April 1, 2002, to March 31, 2003, period. As the figure shows, the 
region as a whole met at least 93 percent of its need. In two 
countries--Malawi and Zambia--food aid and commercial imports combined 
considerably exceeded the cereal gap, while the other four had unmet 
gaps ranging from between 9 percent to 50 percent. However, the numbers 
reported by the Vulnerability Assessment Committees (VAC), WFP, and 
others do not allow us to precisely define total food aid and 
commercial import levels. The figures are estimates and should be 
interpreted with caution. Food aid figures probably underestimate 
actual values because it was difficult for the VACs and WFP to collect 
comprehensive food aid data from NGOs. Thus, total NGO contributions 
could be considerably higher. Regarding commercial imports, some 
countries had experienced a considerable amount of informal trade in 
cereals, but the VACs and WFP did not always have access to reliable 
figures on informal trade. In the case of Zimbabwe, commercial imports 
may be exaggerated, since the VAC expressed skepticism about the data 
that were reported. According to some observers, Zimbabwe's price 
controls may have encouraged a substantial outflow of cereals to 
neighboring countries where controls did not exist. Thus, the gap in 
Zimbabwe may have been much greater than shown in the figure.

Figure 3: Extent to Which Cereal Food Aid and Commercial Imports Met 
the Cereal Gap (April 1, 2002, through March 31, 2003):

[See PDF for image]

[End of figure]

The data in figure 3 do not address the extent to which different parts 
of a country were served. Although Zambia appears to have offset its 
cereal gap by a large amount, the January VAC assessment reported 
serious cereal supply problems at local markets in rural 
areas.[Footnote 18] In addition, Malawi, which offset its cereal gap to 
an even greater extent, reported maize to be available in most markets, 
but vulnerable households had limited ability to pay for the food. (See 
app. V for additional information on commercial imports.):

Food Aid Did Not Reach the Region Early Enough to Avert Widespread 
Hunger:

The overall commercial cereal imports and food aid averted widespread 
famine, according to WFP, USAID, and other observers in the region. 
However, because food supplies to the region were less than planned 
during the July through December period, far fewer people received food 
aid than expected. Many people in vulnerable areas went without meals 
and resorted to other coping mechanisms as well. Limited data available 
on nutritional status generally do not show a significant impact on 
acute malnutrition.

Food Supplies from World Food Program:

Between July and December 2002, WFP distributed only 48 percent of the 
cereal it planned to provide to beneficiaries during that period. While 
Malawi and Swaziland received 87 percent and 76 percent, respectively, 
of their planned deliveries, the other four countries fell below the 40 
percent mark.

In addition to cereal, WFP planned to provide several other foods 
(principally pulses, vegetable oil, and corn/soya blend) for added 
nutrition as well as to meet the special needs of some of its 
recipients. WFP realized only 17 percent of its planned distribution of 
these foods for July through December 2002. WFP deliveries in three 
countries--Mozambique, Zambia, and Zimbabwe--each represented less 
than 10 percent of its plans (1 percent in the case of Zambia). In 
Malawi, which had the best performance, WFP achieved 40 percent of its 
planned distribution.

Figure 4 shows monthly performance in achieving its plans for 
delivery of cereals and noncereal commodities in the region. In 
general, performance gradually improved between July and 
December. It improved substantially in January, achieving 97 percent 
for cereals and 74 percent for noncereals. Deliveries declined during 
the next 2 months, to a low in March of 81 percent for cereal and 53 
percent for noncereals.

Figure 4: Extent to Which WFP Monthly Food Delivery Targets Were Met 
(July 2002 through March 2003):

[See PDF for image]

[End of figure]

Food Supplies from Nongovernmental Organizations:

Independent of program, NGOs were to provide about 402,000 MT of 
cereals, or one-third of the emergency cereal need for the region. NGOs 
obtained or financed food for their efforts from donor countries as 
well as other voluntary contributions. The United States funded a World 
Vision program that provided 19,710 MT of cereal food aid to Zimbabwe. 
In addition, the United States contracted with an NGO consortium, 
called C-SAFE (Consortium for the Southern Africa Food Security 
Emergency), to deliver food into the region. According to U.S. 
officials, the program was part of a longer-term strategy that targeted 
the most vulnerable populations that the WFP program might miss. USAID, 
which began discussions withC-SAFE members (CARE, Catholic Relief 
Services, and World Vision) in July 2002, did not approve a program for 
the consortium until January 15, 
2003.[Footnote 19] However, under a November pre-authorization 
agreement, C-SAFE began delivering food into the region in late 
December 2002. As of the end of March 2003, the consortium had 
delivered about 57,000 MT of cereal food aid to Malawi, Zambia, and 
Zimbabwe. (See app. IV for additional information on C-SAFE.) Data 
provided to us by WFP indicate NGOs provided at least another 16,200 MT 
of cereals food aid into the region.

Beneficiaries Fewer than Intended:

Between July and December 2002, WFP averaged only 3.9 million 
beneficiaries per month, compared with a planned average of 10.4 
million people per month (for both cereal and noncereal food 
aid).[Footnote 20] Figure 5 shows how the shortfall in food aid during 
the July through December 2002 period affected WFP beneficiary levels 
in each country. In four of the six countries, fewer than 45 percent of 
planned beneficiaries were served.

Figure 5: Percent of WFP Total Planned Beneficiaries Who Received at 
Least Some Food Aid (July through December 2002):

[See PDF for image]

Note: According to USAID officials, Malawi and Swaziland did better 
than the other countries, at least in part because they placed fewer or 
no restrictions on biotech food aid.

[End of figure]

In addition, many people who did receive food aid did not receive a 
full ration.[Footnote 21] For example, WFP officials in Malawi told us 
that during November they were only able to provide cereal to many of 
their beneficiaries. Beans and vegetable oil were unavailable to 
provide a balanced diet.

Reduced Food Intake, Other Coping Strategies:

Studies show that people in vulnerable communities reduced food intake 
as their major coping strategy, and this approach has increased since 
the crisis began. For example, as of December 2002, more than 60 
percent of the population in all regions of Malawi reduced the amount 
of food and number of meals they ate, according to the VAC.

The Southern African Development Community (SADC) identified other 
coping strategies including reducing expenditures on nonfood items, 
selling or trading household assets to get food (e.g., sale of 
livestock), increasing consumption of wild foods, migrating to find 
work or food, stealing, and resorting to prostitution. Table 2 shows 
the extent to which surveyed households in Zambia relied on reduced 
food consumption and other coping strategies from between August and 
December 2002.

Table 2: Frequency of Household Coping Strategies in Zambia (August 
through December 2002):

Coping Strategy: Reduced number of meals; Percent of households engaged 
in each: 78.

Coping Strategy: Reduced amount at meal times; Percent of households 
engaged in each: 72.

Coping Strategy: Skipped food for an entire day; Percent of households 
engaged in each: 58.

Coping Strategy: Reduced expenditures on alcohol and tobacco; Percent 
of households engaged in each: 57.

Coping Strategy: Increased consumption of wild foods; Percent of 
households engaged in each: 38.

Coping Strategy: Reduced expenditures on non-food items; Percent of 
households engaged in each: 34.

Coping Strategy: Above-normal livestock sales; Percent of households 
engaged in each: 32.

Coping Strategy: Borrowed from friends and relatives; Percent of 
households engaged in each: 30.

Coping Strategy: Borrowed from nonfamily members; Percent of households 
engaged in each: 27.

Coping Strategy: Borrowed from money lenders; Percent of households 
engaged in each: 5.

Source: Zambia National Vulnerability Assessment Committee, Zambia 
Emergency Food Security Assessment (Lusaka, Zambia: January 2003).

[End of table]

Nutritional Impacts Mixed:

Between 1999 and 2001, acute malnutrition rates in countries of the 
region for children under 5 years of age were between 1.2 percent and 
6.4 percent. Some assessments conducted between May and October 2002 
found an increase in acute malnutrition rates compared with earlier 
studies but did not find rates consistent with a severe food crisis, 
which would be 10 percent to 15 percent. However, these studies did not 
exclude possible pockets of severe malnutrition or hunger-related 
deaths in the region. Also, adult malnutrition and malnutrition in 
urban areas were not surveyed.[Footnote 22] More recent assessments 
(December 2002 through January 2003) of acute malnutrition for children 
under age 5 in select districts of Malawi, Mozambique, Swaziland, and 
Zambia found rates generally ranging between 2 percent and 8 percent. 
However, the rate was 11.2 percent in one province of Mozambique.

According to a recent internal U.S. government report, anecdotal 
evidence from the field in late 2002 indicates that in certain 
districts in Zimbabwe, children were being admitted to some health care 
facilities in increasing numbers for malnutrition. At one facility, 
three to five children were reported to have died of malnutrition 
during each month of 2002. More formal nutrition surveys within the 
country have demonstrated acute malnutrition rates of 6.4 percent and 
7.3 percent in May and August 2002, respectively. Results from a 
nutrition survey conducted in early 2003 are still pending.

Nonfood Emergency Needs Severely Underfunded:

In addition to requesting $507 million for emergency food aid for July 
2002 through March 2003, U.N. agencies also requested $143.7 
million[Footnote 23] to address urgent and related humanitarian needs 
that increased people's vulnerability to famine for the July 2002 
through June 2003 period. As of April 9, 2003, less than 25 percent of 
the total identified requirements had been funded, according to an 
April 22 U.N. southern Africa humanitarian crisis update. Principal 
objectives of the request were to:

* prevent, contain, and address the outbreak of disease through 
enhanced health and nutritional surveillance;

* address the needs of people living with HIV/AIDS and seek to prevent 
new infections;

* ensure an adequate and timely provision of agricultural inputs for 
the next planting season as well as emergency veterinary inputs;

* maintain the capacity for planning recovery efforts in food self-
sufficiency, education, and health services; and:

* prevent marginal populations from falling into a downward spiral that 
could lead to prolonged dependency in the future.

A longer-term objective was to phase out emergency humanitarian 
assistance and move toward a development agenda focused on poverty 
reduction, HIV/AIDS prevention and control, and support for food 
security by increasing food production and strengthening foreign 
exchange earnings. (For additional information on nonfood emergency 
needs, see app. VI.):

Slow Donations, Poor Infrastructure, Concerns Associated with Biotech 
Food Were Major Obstacles to an Effective Response:

Major obstacles to the food aid effort's success were the lack of 
sufficient, timely food donations; poor infrastructure in recipient 
countries; and concerns associated with biotech food. Although the 
United States made substantial, early donations, aggregate commitments 
from donor countries were 18 percent below what WFP needed for the July 
through December period. The shortfall was actually higher given the 
lag in time between when food is committed and when it arrives in-
country. Poor infrastructure in recipient countries and related 
logistical constraints impeded efficient delivery of food aid and in 
some cases prevented food from reaching beneficiaries. Concerns over 
biotech food led Zambia to reject U.S.-donated maize and other 
countries to impose costly processing requirements. These actions 
reduced or delayed food aid, increased costs, and complicated the 
logistics of the emergency operation.

Lack of Sufficient, Timely Donations Contributed to Food Aid 
Shortfalls:

By the end of June 2002, the United States had delivered more than 
41,000 MT of food aid to ocean ports in the southern African region. 
U.S. deliveries to these ports between July and December 2002 
represented approximately 50 percent of the food WFP needed to arrive 
in-country during that period. (See app. IV for additional information 
on U.S. food aid donations.) Nonetheless, in aggregate, donors did not 
make sufficient, timely donations to WFP.

WFP needed about 855,000 tons of food (cereals and noncereals) to 
arrive in the six countries from July through December 2002 to support 
its planned food distributions. During that period, donors advised WFP 
that they would contribute about 701,000 tons--a shortfall of 18 
percent. However, the shortfall was actually greater because of the 
considerable lag time between when WFP was advised in writing that a 
contribution would be made and when food arrived in a beneficiary 
country. WFP officials estimate that in-kind contributions take 3 to 5 
months from the time donors confirm the contribution to the arrival of 
food aid at its final distribution 
sites.[Footnote 24] However, according to WFP officials, when 
contributions are made in cash and procurement is done within the 
region, the process can be reduced to 1 to 3 months.

Table 3 shows the countries that gave the most to regional 
emergency food aid operation and when they advised WFP of their 
intended donations. Some of the major donors, including the United 
States and the United Kingdom, gave large amounts early to the crisis. 
Others, including the European Union, South Africa, and Japan, waited 
several months or longer before confirming what they would contribute.

Table 3: Contributions to WFP and Their Timing:

Food in metric tons:

Cumulative Confirmed Donations[A] to WFP's Southern Africa Regional 
EMOP by End of March 2003:

United States:  
Jul 2002: 194,350:  
Aug 2002: 197,550:  
Sep 2002: 248,403:  
Oct 2002: 248,403:  
Nov 2002: 326,553:  
Dec 2002: 326,553:  
Mar 2003: 326,553.

European Union: Cumulative Confirmed Donations[A] 
Jul 2002: [Empty]:  
Aug 2002: [Empty]:  
Sep 2002: [Empty]:  
Oct 2002: 139,854:  
Nov 2002: 139,854:  
Dec 2002: 139,854:  
Mar 2003: 179,531.

South Africa:  
Jul 2002: [Empty]:  
Aug 2002: [Empty]:  
Sep 2002: [Empty]:  
Oct 2002: [Empty]:  
Nov 2002: [Empty]:  
Dec 2002: [Empty]:  
Mar 2003: 100,000.

United Kingdom: Cumulative Confirmed Donations[A] 
Jul 2002: 62,515:  
Aug 2002: 65,385: 
Sep 2002: 65,385; 
Oct 2002: 65,231; 
Nov 2002: 65,231; 
Dec 2002: 65,231; 
Mar 2003: 70,231.

Japan:  
Jul 2002: [Empty]; 
Aug 2002: [Empty]; 
Sep 2002: [Empty]; 
Oct 2002: 35,295; 
Nov 2002: 35,450; 
Dec 2002: 54,386; 
Mar 2003: 56,662.

Algeria:  
Jul 2002: [Empty]:  
Aug 2002: [Empty]:  
Sep 2002: [Empty]:  
Oct 2002: [Empty]:  
Nov 2002: [Empty]:  
Dec 2002: [Empty]:  
Mar 2003: 31,000.

Germany:  
Jul 2002: [Empty]:  
Aug 2002: 6,113:  
Sep 2002: 14,539; 
Oct 2002: 15,344; 
Nov 2002: 15,344; 
Dec 2002: 24,256; 
Mar 2003: 22,775.

Australia:  
Jul 2002: [Empty]:  
Aug 2002: 6,185:  
Sep 2002: 14,335; 
Oct 2002: 14,597; 
Nov 2002: 14,597; 
Dec 2002: 18,098; 
Mar 2003: 18,248.

Finland:  
Jul 2002: [Empty]:  
Aug 2002: 4,075:  
Sep 2002: 6,149; 
Oct 2002: 8,377; 
Nov 2002: 8,377; 
Dec 2002: 14,575; 
Mar 2003: 14,934.

Canada:  
Jul 2002: 1,661; 
Aug 2002: 1,661; 
Sep 2002: 6,779; 
Oct 2002: 6,697; 
Nov 2002: 6,697; 
Dec 2002: 12,573; 
Mar 2003: 12,573.

OPEC:  
Jul 2002: [Empty]; 
Aug 2002: [Empty]; 
Sep 2002: [Empty]; 
Oct 2002: [Empty]; 
Nov 2002: [Empty]; 
Dec 2002: [Empty]; 
Mar 2003: 12,411.

Netherlands:  
Jul 2002: 1,097:  
Aug 2002: 10,797; 
Sep 2002: 10,797; 
Oct 2002: 10,797; 
Nov 2002: 10,797; 
Dec 2002: 10,797; 
Mar 2003: 10,625.

All others[B]: Cumulative Confirmed Donations[A] 
Jul 2002: 7,133:  
Aug 2002: 12,961; 
Sep 2002: 12,789; 
Oct 2002: 14,471; 
Nov 2002: 14,471; 
Dec 2002: 35,097; 
Mar 2003: 36,549.

Total:  
Jul 2002: 266,756; 
Aug 2002: 304,727; 
Sep 2002: 379,176; 
Oct 2002: 559,066; 
Nov 2002: 637,371; 
Dec 2002: 701,420; 
Mar 2003: 892,092.

Source: GAO analysis based on WFP data.

[A] A confirmed donation (in kind or in cash) is when a donor has 
notified WFP in writing of what it will donate.

[B] There were 29 other donors, some of which were private or 
multilateral entities. Together, they accounted for 4.1 percent of all 
donations, with an individual range from 0.001 percent to 0.7 percent.

[End of table]

WFP acknowledged that the early months of the regional EMOP would 
indeed have benefited from more rapid mobilization of resources. At the 
same time, WFP said, as of mid-May 2003, the operation had been 93 
percent resourced, by 41 institutional donors--which represented an 
unusually supportive response.

Poor Infrastructure Hampered Efficient Food Delivery:

The flow chart shown in figure 6 illustrates logistics process of 
delivering food, from the time it is shipped by suppliers to the time 
food is actually distributed to the recipients at the village 
level.[Footnote 25] Food aid commodities are either purchased by WFP 
regionally or shipped to the region through one of five ports of entry: 
Beira, Nacala, and Maputo in Mozambique; Durban in South Africa; or Dar 
es Salaam in Tanzania. (See fig. 7 for a map of the transportation 
network.) From these points of entry, food is transported by truck or 
rail to intermediate storage facilities, or transshipment points, which 
are strategically located in various districts within the country to 
streamline the flow of deliveries. From these strategic locations, food 
is then transported to extended delivery points--storage facilities 
generally located at the district level--from which the food aid 
allocations for each final distribution site are dispatched. WFP 
manages this process, including transporting the food to the extended 
delivery points. Wherever possible, nongovernmental organizations that 
are designated as the implementing partners are responsible for the 
secondary transport of food from the extended delivery points to the 
final distribution points.

Figure 6: Steps in the Logistics Process:

[See PDF for image]

[End of figure]

Note: The flow chart does not reflect the additional step of milling. 
In addition, the chart does not show monitoring of the flow of food 
deliveries throughout the process to ensure proper receipt and 
dispatches of food.

Figure 7: The Transportation Network for Moving Food in the Region:

[See PDF for image]

[End of figure]

Long-standing weaknesses in transportation infrastructure across the 
region hampered timely delivery of food aid where it was needed. Much 
of the transportation infrastructure (including ports, railways, and 
roads) had deteriorated since the 1991/92 drought. For example, the 
port of Maputo, which is ideally situated for moving food commodities 
to landlocked countries, such as Swaziland and Zimbabwe, cannot be used 
optimally because of the lack of adequate port warehouse and storage 
facilities. However, even when ports are full, there is a limit to the 
amount of food that can be transported over land to landlocked 
countries, like Zambia, due to rail and trucking capacity and other 
logistical considerations.

According to WFP officials, the port of Nacala was in better condition 
than the port of Maputo. But its rail system--the sole transport link 
between Malawi and the nearest port in Mozambique and the shortest, 
cheapest route into Malawi and eastern Zambia--was in such poor 
condition it had to be fixed during the crisis. In late 2002, the 
United Kingdom and Canada gave WFP $6.4 million and $256,000, 
respectively, to rehabilitate a 48-mile-long track on the Nacala 
railway and to lease locomotives and wagons. While these locomotives 
and ongoing repairs to the rail corridor represented a major 
breakthrough, unexpected setbacks continued to mire operations. For 
example, in Malawi, heavy rains in January 2003 completely destroyed 
one bridge on the Nacala rail line, thus impeding the movement of 
commodities for at least 10 days. In late summer 2002, a donation of 
200 trucks from the government of Norway and the International 
Federation of Red Cross and Red Crescent Societies helped ease access 
to places that are particularly hard to reach. However, many village 
roads in these countries routinely become impassable when the rainy 
season (September to March) begins, thus isolating beneficiaries from 
food deliveries.

Recipient Country Concerns about Biotech Food Compromised Food 
Pipeline:

In the middle of 2002, Zambia and Zimbabwe debated whether to accept 
U.S.-donated maize[Footnote 26] based on concerns that it might contain 
biotech products that could adversely affect (1) the health of food aid 
recipients, (2) the countries' agricultural biodiversity,[Footnote 27] 
and (3) their ability to export agricultural commodities.[Footnote 28] 
Despite some earlier concerns over U.S. biotech food aid and Zimbabwe's 
objections to biotech whole kernel maize dating back to the middle of 
2001,[Footnote 29] the United States and international agencies did not 
have a ready alternative to biotech food aid in the southern Africa 
crisis.[Footnote 30] The United States was only partly successful in 
its efforts to persuade southern African country governments to allow 
unrestricted import and distribution of food aid, including biotech 
products, on an emergency basis for the duration of the crisis. Efforts 
included providing information about agricultural biotechnology and the 
safety of biotech food aid to Zambia and the other countries. 
Nevertheless, Zambia rejected all food aid that could have included 
biotech commodities.[Footnote 31] Zimbabwe implemented stringent grain 
handling procedures, including milling of whole grain maize, that 
significantly slowed distribution of food aid. Malawi, Mozambique, and 
Lesotho also debated what to do and eventually imposed milling 
requirements on whole grain maize that were enforced with varying 
degrees of rigor.[Footnote 32]

Toward the end of August 2002, FAO, WHO, and WFP issued a common 
statement on biotech food aid, as did the European Union. Both 
statements indicated that biotech food aid was unlikely to present a 
risk to human health and suggested milling the maize as a way to 
overcome environmental and trade concerns. However, U.S. officials from 
State, USAID, and USDA believe that, given the severity of the crisis 
and existing scientific evidence, U.N. agencies and the European Union 
did not speak out early or forcefully enough on the issue.

The United States rejected the option of donating only milled maize, 
citing increased costs and limited U.S. milling capacity that would 
cause delays in getting food aid to needy people. U.S. officials 
estimate that U.S.-based milling would double the costs of its food 
aid, thus reducing the amount of aid it could provide. Additionally, 
according to U.S. officials, agreeing to mill all of the maize could 
have promoted the idea that unprocessed maize was unsafe. (App. VII 
provides further discussion of issues related to biotech food.):

Despite the United States' early and large donations, the impasse over 
biotech food significantly compromised the food pipeline in several 
ways:

* Food aid was reduced and delayed. On September 3, 2002, Zambia's 
Agriculture Minister, in a statement to the press, demanded that 19,000 
MT of biotech maize that had been delivered to storage facilities 
inside the country be sent to a country that was willing to accept it. 
(WFP was officially notified on October 29, 2002.) According to U.S. 
officials, by early November, Zambia had rejected an additional 57,000 
MT of biotech maize intended for its food aid beneficiaries. The 
combined 76,000 MT of maize considerably exceeded cereal 
shortfall for Zambia for the July through December period and would 
have fed 1.5 million Zambians for 3 months.[Footnote 33]In the case of 
Zimbabwe, there were delays while the government debated whether to 
accept whole grain maize and then negotiated, developed, and put in 
place restrictions it deemed suitable. According to a U.S. official, at 
one point, more than 80,000 MT of U.S. whole kernel maize imports 
destined for Zimbabwe were delayed in South Africa and Mozambique port 
warehouses awaiting permits--while the food aid pipeline lacked cereal.

* Costs of food aid operations increased. WFP, national governments, 
and other donors have borne the additional costs associated with 
requirements to mill some or all of the U.S.-donated maize. These costs 
include the milling itself, added charges for transporting whole grain 
maize to mills and for shipping milled product, added storage costs 
because of limited milling capacity, and grain losses associated with 
the milling process.[Footnote 34] WFP estimates that when it has to 
mill the product in South Africa, regional distribution costs could 
total up to $80 per metric ton more than for unmilled U.S. 
maize.[Footnote 35]

* Logistics of the food aid effort were complicated. Logistics became 
more complex because of (1) U.S. whole kernel maize piling up in ports 
as governments debated whether to accept biotech maize and, if so, 
under what conditions, (2) limited milling capacity, (3) added 
transportation and storage requirements, and (4) the short shelf life 
of maize milled regionally (3 months compared with 12 months for whole 
maize). Because food is distributed to households on a monthly basis, 
WFP had to ensure that milled maize would not take more than 2 months 
to arrive at final distribution sites.

U.S. officials said that recipient countries in southern Africa did not 
make timely, informed decisions about whether to accept or reject 
biotech food aid. These officials also said the U.S. government does 
not have comprehensive data on which recipient countries are likely to 
accept or reject biotech food aid, nor does the U.S. government have a 
strategy for providing alternatives to biotech food to countries that 
may reject it. According to officials from State, USAID, and USDA, 
these problems are not confined to the southern Africa region but also 
have a global reach.

Declining Support for Agricultural Sector and the HIV/AIDS Epidemic 
Pose Challenges to Emerging from Crisis into Sustained Recovery:

The major challenges to emerging from the current food crisis into 
sustained recovery include (1) a decline in agriculture sector 
investments; (2) limited scope of existing programs in agricultural 
development; and (3) the negative impact of the HIV/AIDS epidemic. 
Recognizing the need to address numerous challenges to move out of this 
crisis into recovery, the U.N. Secretary-General and several other key 
stakeholders have called for a comprehensive and targeted approach to 
break the pattern of recurrent food crises in Africa. The food outlook 
for the next crop year has improved, but without continuing efforts to 
respond to the region's problems, recurring food crises may be 
difficult to avoid.

Agriculture Sector Investments by Donors and Governments Have Declined:

Since agriculture accounts for 70 percent of the labor force in Africa, 
investments that improve productivity in the agricultural sector have 
significant implications for food security and overall rural 
development. According to the International Food Policy Research 
Institute, a 1 percent increase in agricultural productivity would help 
6 million more Africans raise their incomes above $1 per day. However, 
data show declining investments in the agricultural sector as 
agricultural lending by the World Bank, the African Development Bank, 
and the International Fund for Agricultural Development has fallen. 
Similarly, agricultural spending by national governments and U.S. 
bilateral assistance for agricultural programs in the affected 
countries have declined.[Footnote 36]

Agricultural Lending by Selected International Financing 
Organizations:

Total lending to the agriculture sector by selected international 
financing organizations declined during the 1990s. For example, 
measured in 2003 dollars, the African Development Bank approved about 
$873 million in loans for agriculture in 1990 compared with $236 
million in 2000, as shown in figure 8. Similarly, the World Bank 
approved $4.7 billion in loans for agriculture in 1990 compared with 
$1.4 billion in 2000. Bank officials noted that the World Bank now 
approaches the agricultural sector in the context of the Bank's overall 
rural development strategy that includes, among other things, lending 
for rural infrastructure, rural health, and environment and natural 
resource management. For this reason, starting in 2001, the World Bank 
began to include agricultural investments as part of its rural 
development lending. However, this does not negate the overall 
declining trend in agricultural lending between 1990 and 2000.

Figure 8: Agricultural Lending by the World Bank, the African 
Development Bank, and the International Fund for Agricultural 
Development-1990 through 2000:

[See PDF for image]

Note: IFAD provides strictly agricultural development loans.

[End of figure]

Our review of World Bank agricultural loans to the six affected 
countries since 1990 found that 15 had been made--with 9 of them 
approved between 1990 and 1993. There were no loans recorded for 
Swaziland. As shown in figure 9, in 2002, the downward trend in World 
Bank agricultural lending to the affected region reversed with two $50 
million emergency drought recovery loans for Zambia and Malawi. These 
loans included an agricultural component but also comprised health, 
social services, and other emergency programs.

Figure 9: World Bank Agricultural Sector Loans Approved for the 
Affected Countries-1990 to 2002:

[See PDF for image]

[End of figure]

Agricultural Spending by National Governments:

In general, national governments have been spending a declining share 
of their budgets on agriculture, as shown in figure 10. Real spending 
on agriculture has declined for two countries--Lesotho and Zambia--
whereas total government spending has increased for all six affected 
countries. For the remaining countries, national government spending on 
agriculture has been stagnant or has grown at a slower rate than total 
government spending.

Figure 10: Agricultural Spending as a Percentage of Total Government 
Spending-1996/97 through 2001/02 (in 2003 dollars):

[See PDF for image]

Note: 2001/2002 data for Lesotho, Malawi, and Zimbabwe were not 
available.We did not calculate the percentage of government spending 
for agriculture for Mozambique. The IMF provided us with the percentage 
data.

[End of figure]

U.S. Bilateral Assistance for Agricultural Sector:

Although the levels of U.S. bilateral assistance for agriculture by 
country have been mixed, overall assistance to the region's 
agricultural sector has declined from $27 million in 1998 to $20.6 
million in 2003. The largest reductions were for Malawi, which went 
from $10.3 million in 1998 to $3.2 million in 2003, while assistance to 
Mozambique went from $14.5 million in 1998 to $12.8 million in 2003 
(see fig. 11).

Figure 11: USAID Bilateral Assistance in the Agricultural Sector to 
Four CountriesA-1998 to 2003:

[See PDF for image]

[A] USAID does not have bilateral programs in Lesotho and Swaziland. 
However, these two countries do benefit from some regional assistance 
and limited funding support through other U.S. government agencies.

[B] The combined figure includes Malawi, Mozambique, Zambia, and 
Zimbabwe. It does not include Regional Center funding.

[End of figure]

Existing Programs Are Helpful but Limited in Scope:

To promote agricultural development and work toward achieving food 
security, FAO, IFAD, and WFP advocate an approach that helps support 
small farmers, enhances the ability of the poor to access food, and 
aids recovery efforts (fig. 12 describes examples of some of the 
current programs). Several U.N. and USAID officials told us that while 
many of the programs they have funded have demonstrated promising 
results, the programs are limited in scope due to resource constraints 
and would need to be implemented on a much wider scale for greater 
impact and effectiveness.

Figure 12: Examples of Existing Programs Related to Food Security:

[See PDF for image]

[End of figure]

Negative Impact of HIV/AIDS on Food Security Will Grow:

In addition to being a significant factor that contributed to the food 
crisis, HIV/AIDS will continue to affect food security in the region by 
decreasing food production, lowering household income, and increasing 
household expenses, according to numerous experts. These effects will 
increase as the HIV/AIDS epidemic worsens. For example, by lowering the 
productivity of agricultural labor in its food supply model, USDA 
estimated that HIV/AIDS will cause a 3.3 percent reduction in grain 
output in sub-Saharan Africa over the next decade relative to the 
region's baseline projections. As a result, the projected food deficit 
will grow by 13 percent.[Footnote 37]

According to an IMF study, HIV/AIDS will also lower gross domestic 
product (GDP). Figure 13 shows the projected decrease in growth rates 
of GDP per capita attributable to HIV/AIDS in 10 to 15 years: Estimates 
range from minus 4 percent in Mozambique to about minus 7 percent in 
Zimbabwe. Projected average per capita GDP growth rates without HIV/
AIDS range from 1.5 percent for Lesotho to 3.9 percent for Mozambique, 
indicating that the HIV/AIDS effect will significantly reduce national 
income.[Footnote 38] In fact, for a typical sub-Saharan African country 
with HIV/AIDS prevalence of 20 percent, national income is estimated to 
be 67 percent lower at the end of a 20-year period than without the 
disease.

Figure 13: Projected Impact on GDP Due to HIV/AIDS:

[See PDF for image]

Note: Estimates are for an economy open to trade and are for a 10-to 
15-year period with 2000 as the base year.

[End of figure]

U.N. Secretary-General and Others Cite Need for Integrated Response:

Although the international response was sufficient to avoid famine in 
past food crises in the region--as well as the current one--food 
security continues to be a significant development challenge. U.N. and 
U.S. officials acknowledge that food aid and humanitarian assistance 
alone will not prevent future crises without a comprehensive recovery 
strategy that addresses the underlying causes of food insecurity. In 
our review, we found no evidence of such a strategy.

In March 2003, the U.N. Secretary-General noted that the devastating 
impact of HIV/AIDS requires an integrated response that may include 
long-term measures even when addressing short-term emergencies and 
called for a more systematic, targeted approach to break the pattern of 
recurrent food crises in Africa. Many other authoritative experts and 
key stakeholders have echoed the U.N. Secretary-General's call for an 
integrated response. For example, in December 2002, SADC--the principal 
organization for regional cooperation in food and agriculture and 
related economic and social issues--acknowledged the need for political 
commitment at all levels within the region and for coordinated support 
from SADC, national governments, donors, nongovernmental 
organizations, and civil society to ensure food security in the future. 
Among those calling for a comprehensive response to address food 
security--one that integrates agricultural development, HIV/AIDS, 
natural disaster management, and other appropriate interventions--are 
the U.N. Office for the Coordination of Humanitarian Affairs, the 
International Food Policy Research Institute, and the Partnership to 
Cut Hunger and Poverty in Africa.

In recent years, international donors have announced major initiatives 
related to food security. These include plans not only to enhance food 
availability by increasing agricultural production but strategies to 
increase food accessibility by reducing poverty. For example, the 
United Nations' 2001 Millennium Development Goals pledged to help cut 
hunger in Africa in half by 2015.[Footnote 39] The World Bank and IMF 
have worked with countries eligible for debt relief--Malawi, 
Mozambique, and Zambia--to ensure that food security and agriculture 
are central themes in these countries' Poverty Reduction Strategy 
Papers.[Footnote 40] Among other measures, these strategy papers 
emphasize promoting small-scale irrigation, reducing land degradation, 
and improving access to credit and agricultural inputs. In early 2002, 
USAID introduced its Agricultural Initiative to Cut Hunger in Africa, 
which is designed to accelerate agricultural growth and reduce 
vulnerability to hunger and poverty. However, as of April 2003, of the 
six affected countries, only Mozambique was proposed for funding ($3.9 
million in 2003) under the initiative.

Regional Food Outlook Remains Tenuous; Sustained Efforts Seen as 
Necessary:

Despite improved weather conditions and a better harvest beginning in 
April 2003, food security conditions in the region are still tenuous. 
As of the end of March 2003, early warning systems were forecasting 
that some parts of the region may have better harvests than last year; 
however, they also note that food insecurity and the need for emergency 
aid persist--and may worsen--in some areas, particularly in Zimbabwe 
and parts of southern Mozambique. In February 2003, the U.N. Office for 
the Coordination of Humanitarian Affairs stated that, because the 
response to improve agricultural inputs has been inadequate, recovery 
by the next agricultural season is unlikely and the need for food aid 
prolonged. In fact, the current emergency operations, which were for 
the crop year that concluded March 2003, have been extended through 
June 2003. Beyond that, according to WFP and USAID officials, the need 
for food aid will likely continue, particularly for many of the poorest 
and most vulnerable households.

Conclusions:

The current food crisis is complicated by disruptive agricultural and 
governance policies in the affected countries and the HIV/AIDS 
epidemic. While the WFP, the United States, some donor governments, and 
NGOs provided enough food to prevent a famine, overall donor response 
was insufficient in terms of food quantities and timeliness to prevent 
widespread hunger. In addition, other obstacles--including poor 
infrastructure in the affected countries and concerns associated with 
biotech food--hampered an effective response. The controversy about 
biotech food aid, in particular, significantly complicated logistics, 
increased costs, and delayed food aid reaching beneficiaries. Concerns 
about agricultural biotechnology may be an obstacle to addressing 
future emergency food aid needs around the world, partly because the 
United States accounts for about half of global food aid and because 
several U.S. food aid commodities are genetically modified.Action is 
needed to reduce the likelihood of biotech food aid becoming a serious 
problem in future crises. Furthermore, in a region where agricultural 
production is critical to national economies and food security, there 
is a need for viable agricultural policies and funding by national 
governments, as well as adequate agricultural assistance and related 
strategies from multilateral organizations and donors, including the 
United States. Without a concerted strategy that integrates, among 
other things, agricultural development, the impact of HIV/AIDS, and 
natural disaster management, destabilizing food crises are likely to 
recur.

Recommendations for Executive Action:

To maximize the effectiveness of the U.S. response to future food 
crises in the southern Africa region as well as in other parts of the 
world, we recommend that the Secretaries of State and Agriculture and 
the Administrator of USAID initiate a comprehensive review of the 
issues pertaining to biotech foods in emergency food aid. In 
anticipation of future food crises, this review could consider measures 
such as (1) encouraging recipient countries to enhance their capacity 
to make informed decisions regarding agricultural biotechnology and 
offering technical assistance in this endeavor; (2) identifying which 
countries are likely to accept, restrict, or reject biotech food aid; 
and (3) determining ways that the United States can contribute to 
emergency food aid needs in countries that decide to restrict or reject 
biotech food aid.

To further food security in the region, we recommend that the 
Secretaries of State and Agriculture and the Administrator of USAID 
work with international organizations, donors, and national governments 
to develop a comprehensive, targeted strategy to ensure sustained 
recovery that (1) integrates agricultural development, HIV/AIDS 
awareness and action, natural disaster management, and other 
appropriate interventions; (2) estimates costs and resource 
requirements; and (3) establishes a plan for mobilizing resources, a 
timetable for achieving results, and indicators for measuring 
performance.

Agency Comments and Our Evaluation:

The Department of State, USDA, USAID, and WFP provided written comments 
on a draft of our report. These comments are reprinted in appendixes 
VIII, IX, X, and XI, along with our responses to specific points.

In general, the Departments of State and Agriculture, USAID, and WFP 
agreed with our overall conclusions and recommendations. However, they 
expressed technical concerns, primarily related to our discussion of 
biotech food, which we have addressed in the text as appropriate.

USDA objected to our use of the term "biotech food," saying it prefers 
"foods which may contain the products of agricultural biotechnology." 
USDA also said that it opposes the use of the term "genetically 
modified organisms" and the acronym "GMO" because these terms carry 
negative connotations. According to the department, modern agricultural 
biotechnology is simply the next step in plant breeding technology. 
Notwithstanding USDA's comments, FAO, WHO, and WFP use the terms 
genetically modified food, GM food, and biotech food. In fact, after 
receiving USDA's comments, we found that USDA was still using the terms 
"biotech plants" and "biotech crops" in some of its publicly available 
informational materials. USAID objected to our use of the term "biotech 
food aid," noting that the United States provides food aid from the 
general U.S. food supply, which may contain biotech crops. In certain 
places, we now refer to U.S. food aid as aid that may contain biotech 
crops.

In commenting on our recommendation to initiate a comprehensive review 
of the issues associated with biotech foods in emergency food aid, USDA 
said that it agrees that all relevant parts of the U.S. government must 
continue to review and engage other countries regarding their biotech 
policies, including those related to food aid. USDA said it will 
continue to support developing countries' efforts to enhance their 
capacity for making science-based and transparent decisions regarding 
products of modern agricultural biotechnology. At the same time, USDA 
said it is difficult to accurately identify countries that might accept 
or reject products of modern agricultural biotechnology because many 
developing countries' policies depend upon the specific political, 
economic, and social circumstances at the time.

The Department of State said that an interagency review on how to 
manage the presence of bioengineered foods in food aid might be useful 
for developing a strategy. However, the department said that such a 
review should be narrowly focused to ensure better coordination among 
food aid, development, trade policy and regulatory agencies. USAID said 
it supports further interagency discussion and coordination on the 
dimensions of biotechnology in food aid. USAID noted that it is 
actively engaged in supporting the development of capacity in a number 
of food aid recipient countries to make informed decisions, but said in 
practical terms this is a long-term strategy and unlikely to assist in 
emergency situations such as we saw in southern Africa. USAID said it 
believes that the most practical solution will be to work with 
recipient governments and partners involved in the delivery of food aid 
to build confidence in the existing safety evaluations of these 
products, including evaluations done in the United States and by other 
countries, scientists, and international organizations such as FAO and 
WHO.

Regarding our recommendation to develop an integrated recovery 
strategy, the Department of State, USAID, and WFP fully support the 
need for a comprehensive, coordinated approach to help address the 
underlying causes of food insecurity. State cited U.S. efforts to work 
with major donor countries to create a multilateral framework for 
improving long-term food security throughout the world. USAID said 
that, along with an interagency working group formed by the sub-policy 
planning committee to coordinate the U.S. government response to the 
food crisis, it is in the process of drafting a recovery strategy and 
action plan, which will guide the development and review of new USAID 
country strategies in the region. WFP emphasized the need for the 
international community to remain engaged within the region and to help 
national governments address medium-to longer-term issues related to 
food insecurity. We agree that such efforts must be sustained if 
destabilizing food crises are to be avoided.

In addition, we provided FAO, IMF, and the World Bank an opportunity to 
review parts of a draft of this report for technical accuracy, and we 
incorporated their comments as appropriate.

:

We are sending copies of this report to appropriate congressional 
committees, the Secretaries of State and Agriculture, and the USAID 
Administrator. Copies will be made available to others upon request. In 
addition, this report will be available at no charge on the GAO Web 
site at http://www.gao.gov.

If you or your staff have any questions about this report, please 
contact me on (202) 512-3149. Other GAO contacts and staff 
acknowledgments are listed in appendix XII.

Sincerely yours,

David Gootnick 
Director, International Affairs and Trade:

Signed by David Gootnick:

[End of section]

Appendix I: Scope and Methodology:

To determine what factors contributed to the current crisis in southern 
Africa, we met with and analyzed information from government officials 
at the U.S. Agency for International Development (USAID) and the 
Departments of Agriculture (USDA) and State in Washington, D.C., and 
U.S. missions in Botswana, Malawi, Mozambique, Zambia, Zimbabwe, and 
South Africa. We also met with officials and reviewed information from 
the World Food Program (WFP), the Food and Agriculture Organization 
(FAO), and the International Fund for Agricultural Development (IFAD) 
at their headquarters in Rome and in the southern African countries we 
visited. In addition, we gathered information from and met with 
representatives of the World Bank and the International Monetary Fund 
(IMF), other U.N. agencies, other donor governments, and host 
government ministries. We also gathered information and met with 
representatives of early warning systems and interagency food security 
assessment teams. In addition, we gathered information and met with 
representatives of nongovernmental organizations (NGO), including 
Africare, Bread for the World, the Coalition for Food Aid, CARE, 
Catholic Relief Services, the Coalition for Food Aid, Save the 
Children, World Vision, and ACDI/VOCA. We also reviewed studies from 
public and private research institutions on the causes of the current 
and past food crises in southern Africa.

To determine how well the populations' overall food needs were met 
during the crisis period, we met with officials and reviewed 
information from WFP, FAO, host governments, the private sector, donor 
governments, NGOs, and the Southern African Development Community 
(SADC). We also met with and gathered information from representatives 
of interagency famine early warning and vulnerability assessment teams. 
In addition, we analyzed country-specific and regional WFP food aid 
data tracking food aid flows from donors (through WFP and NGOs) to the 
country level and, for WFP food aid, to the beneficiary level. Because 
of southern Africa's infrastructure and technology problems, our 
collection and analysis of agricultural supply and demand information 
had inherent limitations. We observed food aid distribution at various 
stages including at the points of entry and storage facilities at the 
extended delivery points and final distribution points. We met with 
WFP, NGO, donor, national government, and local government officials 
responsible for managing and monitoring the food aid distribution 
process. We reviewed real time logistics information system 
including its monitoring and loss reports. We also reviewed U.S. and 
other donor financial contributions to determine similar information on 
nonfood aid-related assistance. We verified the accuracy of data and 
reports, to the extent possible, by tracing the flow of information and 
obtaining comparable data from multiple government, international 
organization, NGO, and private sector sources.

To determine the major obstacles to the food aid effort, we met with 
key officials and gathered and examined data from governments and the 
private sector in recipient countries, WFP, donor governments, NGOs, 
and SADC on the rate and amount of donor contributions, infrastructure, 
and biotech food aid and its impact on food aid distribution in the 
current crisis. We examined U.S. and other donor funding of EMOP, 
reviewing actual country donations against pledges to determine the 
sufficiency and timeliness of donations. We reviewed and examined data 
on the transportation network for moving food in the region and 
identified and confirmed transportation and infrastructure obstacles 
during our fieldwork in country. We verified and confirmed the general 
accuracy of these data through multiple private sector and governmental 
organizations. With the assistance of the National Academy of Sciences, 
we had seven U.S. scientists provide an independent perspective on the 
Zambian Scientists' biotech report.

To determine the challenges to emerging from the crisis into sustained 
recovery, we met with numerous NGOs, the World Bank, the IMF, USAID, 
and the Departments of Agriculture and State and analyzed information 
on the decline in agricultural sector investment, the limited scope of 
existing programs in agricultural development, and the negative impact 
of the HIV/AIDS epidemic. In addition, we reviewed studies from private 
and public research institutions, such as the International Food Policy 
Research Institute, on the challenges to moving from crisis into 
recovery. We also analyzed agricultural funding data of the six 
southern African national governments. To analyze World Bank 
agricultural lending, we reviewed World Bank annual reports and its Web 
site from 1990 to 2002 to determine the amount and nature of loans made 
to the six affected southern African countries. After identifying the 
loans, we calculated an average deflator for each fiscal year (July to 
June) and calculated the 2003 value of each of these loans. To analyze 
the percentage of government budgets expended for agriculture, we 
gathered fiscal data for each of the six countries from the IMF country 
statistical appendices for 1997 through 2002. We then calculated the 
current and capital expenditures from agriculture as a share of the 
total current and capital expenditures in the government budget. We 
also calculated the real growth rate using least square regression 
methodology for agricultural and total spending. Finally, to determine 
the impact of HIV/AIDS on food security among the six affected 
countries, we reviewed USDA and IMF studies that quantified the food 
security situation and its economic implications.

The information on foreign laws in this report does not reflect our 
independent legal analysis but is based on interviews and secondary 
sources.

We conducted our review from August 2002 through May 2003 in accordance 
with generally accepted government auditing standards.

[End of section]

Appendix II: Timeline of the Southern Africa Food Crisis:

Figure 14 is a chronology of key events (political actions, alerts, and 
emergencies) that occurred in the region and in some of the affected 
countries during the 2-year period from July 2001 through April 2003.

Figure 14: Timeline of the Southern Africa Food Crisis:

[See PDF for image]

[End of figure]

[End of section]

Appendix III: Early Warning Systems and Vulnerability Assessment 
Methods:

Two types of data collection systems tracked the food crisis in 
southern Africa: (1) early warning systems, which monitor factors that 
affect food supply to provide decision makers with notice of potential 
crises; and (2) assessment systems, which monitor the nutritional needs 
of vulnerable populations in order to design or assess interventions.

Early Warning Systems:

Famine early warning systems are designed to provide decision makers 
with information of an impending food crisis or famine. These systems 
compile various indicators of food security at a regional, national, or 
subnational scale, including information on weather and household 
purchasing power. While early warning systems are useful, preventing 
food crises depends on timely responses to the information they 
disseminate.

For this report, we reviewed two early warning systems:

* FEWS NET: The Famine Early Warning System (FEWS) is a specialized 
Information Network (NET) based in 17 African countries contending with 
chronic food insecurity.[Footnote 41] FEWS NET is a partnership-based 
program initiated and funded by USAID. The goal of FEWS NET is to 
strengthen the ability of African countries and regional organizations 
to manage risk of food insecurity by providing timely and analytical 
early warning and vulnerability information. FEWS NET monitors 
information from multiple technologies, such as satellites and field 
observations, and seeks to facilitate timely access to that 
information; identifies specific, acute food security threats; and 
provides regular information assessments to decision makers that 
reflect the best judgment of the food security community.

* GIEWS: FAO's Global Information Early Warning System on Food and 
Agriculture (GIEWS) is an information system based in Rome that 
includes 116 governments, 3 regional organizations, and 61 
nongovernmental organizations. The goal of GIEWS is to provide the 
international community with warning of imminent food crises to ensure 
timely interventions in countries or regions affected by natural or 
man-made disasters. The system seeks to monitor all aspects of food 
supply and demand in all countries on a continuous basis at the global, 
regional/subregional, national, and subnational levels. It reports to 
the international community through its system of regular and ad hoc 
reports.

FEWS NET and GIEWS often contribute to the WFP/FAO Crop and Food Supply 
Assessment Missions. Additionally, FEWS NET supplies GIEWS with the 
major proportion of its remote-sensing data for monitoring agricultural 
production. However, according to USAID, these two early warning 
systems differ in three main areas:

* Geographic scope: FEWS NET has a 17-country scope in Africa, whereas 
GIEWS has a global mandate.

* Level of detail: FEWS NET reports on the subnational level based on 
information gathered by field staff located throughout their scope, 
whereas GIEWS reports on the national and global levels from their 
headquarters in Rome with few field staff.

* Technical focus on food security: FEWS NET focuses on food 
availability, access, and utilization, while GIEWS focuses on food 
production and availability.

Early Warning Systems in the Southern Africa Food Crisis:

The famine early warning systems produced relevant information 
regarding the southern Africa food crisis. FEWS NET and GIEWS reported 
on such food security indicators as adverse weather events, current 
food shortages, the status of cereal imports, the status of strategic 
grain reserves, the status of grain prices, and forecasts for the 2001/
02 harvest.

In particular, in late 2001 and early 2002 the early warning systems 
reported questionable food security in parts of the six countries, 
accounting for the poor 2000/01 harvest and anticipating future cereal 
gaps based on a poor outlook for the 2001/02 harvest. In November 2001, 
FEWS NET reported that the 2000/01 cereal harvest from earlier that 
year would likely be insufficient to fill food needs in each country 
except Mozambique. After FEWS NET highlighted these potential maize 
shortages, the U.S. government began carefully monitoring the situation 
in southern Africa, according to a Department of State cable. By mid-
February 2002, GIEWS warned that impending severe food shortages 
threatened some 4 million people in the southern African countries, 
including parts of each of the six countries. That same month, however, 
FEWS NET reported that although there were localized areas of concern 
at the national and subnational levels, there was no reason for serious 
concern over production prospects from a regional perspective at that 
point in the growing season. In April 2002, closer to the harvest 
period, GIEWS warned of a looming food crisis in southern Africa, with 
conditions in several countries set to worsen. By May 2002, FEWS NET 
also warned of the potential for a food security crisis of regional 
magnitude if appropriate and timely action were not taken.

Nevertheless, the early warning systems did not anticipate the severity 
of the situation in Malawi. Although the systems did report serious 
maize (corn) production shortfalls in Malawi during the 2000/01 harvest 
caused by mid-season floods and late-season drought, flawed 
agricultural statistics provided by the government of Malawi[Footnote 
42] indicated that the production shortfall would be covered by other 
food crops, especially cassava. According to the IMF, the data error 
only became apparent in February 2002 when Malawi began experiencing 
severe food shortages.

Assessment Systems:

For this report, we reviewed the following assessments:

* VAM: The Vulnerability Analysis and Mapping Unit (VAM) analyzes, 
maps, and reports on populations and geographic areas experiencing food 
insecurity to inform WFP food aid operations in 43 countries. VAM uses 
state-of-the-art mapping techniques to pinpoint the people most 
vulnerable to hunger and target their needs. VAM and FEWS NET work in 
close collaboration in the African countries where they are both 
present. VAM relies on FEWS NET for early warning analyses in most 
African countries. VAM also has a global mandate in supporting internal 
WFP operations, whereas FEWS NET attempts to build assessment capacity 
within the countries.

* CFSAM: Crop and Food Supply Assessment Mission (CFSAM) is a rapid 
assessment of information generated in an affected country used to fill 
in information gaps and to provide an early forecast of production and 
the emerging food supply situation of that country. This is done only 
at the request of the host country government. A mission may also 
collect information on household food security, vulnerability, coping 
mechanisms, and social welfare programs. GIEWS/FAO coordinates such 
missions in conjunction with WFP and other stakeholders such as host 
country ministerial staff, FEWS NET staff, and the Southern African 
Development Community's (SADC) Regional Early Warning Unit (REWU). 
CFSAM targets a wider audience than internally focused VAM unit. 
The international community uses the CFSAM information to calculate how 
much food aid and other relief assistance is needed to assist the most 
vulnerable people.

* VAC: SADC and some of its member states established vulnerability 
assessment committees (VAC) to better assess and address food security 
issues.[Footnote 43] The purpose of VAC assessments is to (1) provide 
additional information to help adjust response programs to better meet 
the needs of vulnerable populations; (2) rapidly investigate and 
characterize or verify suspected crises in local areas; and (3) better 
understand the causes of the emergency and their implications for a 
return to food security. The committees use a coordinated, 
collaborative process that integrates the most influential assessment 
and crisis response players into the effort to help gain privileged 
access to national data sets and expert technicians and increase the 
likelihood of reaching consensus among national governments, 
implementing partners, and major donors. Key players include the SADC 
Regional Early Warning Unit and national VACs, VAM, FEWS NET, GIEWS, 
and several NGOs. The assessment methodology included sample surveys at 
the district, community, and household levels and incorporated 
household food economy and nutritional surveys.

Use of Assessments in the Southern Africa Food Crisis:

Several of the above assessments have been used to prepare for and 
monitor the southern Africa food crisis (see app. II for timeline). FAO 
conducted a series of CFSAMs starting in May 2002. The missions 
estimated cereal requirements and cereal production for each of the six 
countries and the extent to which the gap could be offset by commercial 
imports. (See app. V for more on commercial sector imports and their 
role in the crisis.) The remaining deficit was identified as requiring 
emergency food aid. The regional and national VACs built assessment 
capacity in the region and increased the breadth and depth of food 
security monitoring during the crisis. To this end, the committees 
conducted assessments and prepared reports on their results in 
September 2002 and January 2003. A third assessment occurred in May 
2003.

[End of section]

Appendix IV: U.S. Donations:

By early 2002, the United States had recognized the seriousness of the 
developing food crisis in southern Africa and initiated actions to 
donate substantial quantities of food aid to the region. For example, 
in mid-February 2002, USAID arranged a loan of 8,470 metric tons (MT) 
of maize to southern Africa from stocks held in Tanzania; the commodity 
began arriving in the region in mid-March. On March 15, 2002, USAID 
authorized World Vision to provide 14,310 MT of food aid to Zimbabwe 
(the amount was later increased to 19,710 MT). On March 21, USAID 
authorized the purchase of 35,330 MT of commodities--from existing 
stocks in New Orleans--to be shipped to southern African ports; these 
stocks arrived by the end of June 2002.

Overall, between late April 2002 and March 31, 2003, the United States 
donated and delivered nearly 500,000 MT of food aid to the region 
valued at about $275 million. The food represented approximately 68 
percent of the total food aid delivered into the region between April 
1, 2002, and March 31, 2003.[Footnote 44] U.S. deliveries included:

* 81,950 MT for precursor WFP emergency programs in each of the six 
countries--Lesotho, Malawi, Mozambique, Swaziland, Zambia, and 
Zimbabwe, valued at $43 million;[Footnote 45]

* 19,710 MT for the World Vision program in Zimbabwe, valued at $12.8 
million;

* 326,553 MT for the WFP regional operation, valued at $165.4 million; 
and:

* 71,600 MT for the C-SAFE operation, valued at $53.5 million.

Table 4 provides a breakout of the U.S. food aid by country and 
commodity. As the table shows, Zimbabwe, Malawi, and Zambia received 
the largest amounts of aid. Maize (corn) and maize meal accounted for 
more than 70 percent of the donated commodities. About 84 percent of 
all the donated food represented biotech commodities (i.e., maize, 
maize meal, oil, and corn soya blend (CSB)/corn soya milk(CSM)).

Table 4: U.S. Government Food Aid Response to the Southern Africa 
Crisis:

Country: Lesotho: Corn: 23,500; Corn meal: 2,510: Beans: 800: 
Oil: 950; Corn soy blend/corn soy milk: [Empty]: Sorghum: [Empty]: 
Bulgur: [Empty]: Total: 27,760.

Country: Malawi: Corn: 114,650; Corn meal: 8,500: Beans: 8.720: 
Oil: 4,720; Corn soy blend/corn soy milk: 14,905: Sorghum: [Empty]: 
Bulgur: [Empty]: Total: 151,495.

Country: Mozambique: Corn: 13,000; Corn meal: [Empty]: Beans: 
2,680: Oil: 2,860; Corn soy blend/corn soy milk: 1,250: Sorghum: 
[Empty]: Bulgur: [Empty]: Total: 19,790.

Country: Swaziland: Corn: 11,500; Corn meal: [Empty]: Beans: 700: 
Oil: 725; Corn soy blend/corn soy milk: 2,617: Sorghum: [Empty]: 
Bulgur: [Empty]: Total: 15,542.

Country: Zambia: Corn: 26,500; Corn meal: 9,600: Beans: 7,900: 
Oil: 100; Corn soy blend/corn soy milk: 400: Sorghum: 15,000: 
Bulgur: 15,000: Total: 74,500.

Country: Zimbabwe: Corn: 90,800; Corn meal: 56,510: Beans: 17,120; 
: Oil: 11,946; Corn soy blend/corn soy milk: 24,030: Sorghum: 
[Empty]: Bulgur: 10,000: Total: 215,406.

Country: Total: Corn: 279,950; Corn meal: 77,120: Beans: 37,920: 
Oil: 21,301; Corn soy blend/corn soy milk: 43,202: Sorghum: 15,000: 
Bulgur: 25,000: Total: 499,493.

Source: USAID.

[End of table]

[End of section]

Appendix V: Commercial Imports:

The extent and availability of commercial cereal food supplies during 
the food crisis[Footnote 46] are difficult to assess for a number of 
reasons. Early concerns about the progress of commercial imports 
stemmed from the large amounts of cereal imports needed, the high 
regional prices for maize,[Footnote 47] and the lack of sufficient 
foreign exchange resources for governments and private sector entities 
to purchase the required imports.[Footnote 48] Nonetheless, data 
available in mid-May 2003 indicated that 1.72 million MT of commercial 
cereal imports had been received in the six countries between April 1, 
2002, and March 31, 2003.[Footnote 49] However, the regional 
Vulnerability Assessment Committee September 2002, December 2002, and 
January 2003 reports indicated some serious problems with food 
availability during the year. (See app. III for a detailed description 
of the VACs.) Factors contributing to the uncertainty over commercial 
cereal food supplies included the lack of time frames indicating when 
imports needed to be purchased, data reliability issues, problems 
between urban and rural distribution of food supplies, and government 
policies that provided disincentives to the private sector to import 
food or that, once imports were received in country, discouraged the 
efficient supply of those goods to the local market.

In contrast to food aid effort, the CFSAMs did not identify the 
monthly rate at which imports needed to occur, making it difficult to 
judge the timeliness of commercial imports. The September VAC report 
for Zambia indicated concern that it could be difficult for importers 
to find maize in regional markets (as several countries in the region 
had large deficits and would be competing to buy from the same 
suppliers), which in turn could delay purchases. According to the 
December VAC report for Lesotho, maize, wheat, and sorghum were 
generally not available for purchase at the end of the year in 
communities across that country. In Swaziland, maize was reported to be 
readily available in retail outlets nationwide even though there had 
been no commercial imports between July and November. However, there 
were fears that a shortfall in maize imports would occur between 
December and March, causing another round of price hikes.

Once data on commercial cereal imports began to be available, data 
reliability became an issue in some cases. For example, according to 
the December Zimbabwe VAC report, figures on the combination of 
commercial imports, food aid imports, and available national production 
should have resulted in a surplus of 200,000 MT at the national level. 
However, the report indicated there was something seriously wrong with 
the numbers, since 41 percent of communities surveyed reported that 
cereal grains were not or were rarely available from the government's 
grain marketing board and the other 59 percent reported that the grains 
were only occasionally available. U.S. government officials noted that 
there have been numerous anecdotal reports of the government's 
politicizing food aid, which may partly explain some of the 
discrepancy.

While commercial cereal imports may have been provided to urban 
markets, shortages were reported in many rural areas, indicating 
problems with the distribution of commercial cereal supplies. The 
December VAC report for Lesotho indicated that maize mealæmaize that 
has undergone the milling processæwas said to be available, though very 
expensive, in the various urban centers but generally not available in 
the rural areas, which were characterized as experiencing a serious 
food crisis. The January VAC report for Zambia said there was no 
commercial shortfall in urban areas and millers did not expect one 
through February and beyond. However, most of the maize that had been 
imported (officially or via cross-border trade) was reportedly only 
servicing the urban markets, leaving the rural areas with a severe 
commercial grain shortfall that drastically pushed up prices. Of 48 
villages surveyed, fewer than 10 percent said maize was readily 
available and fewer than 30 percent said maize was occasionally 
available.

Finally, some national governments implemented subsidies and price 
controls that raised concern about private sector imports and whether 
imports received would be supplied to local markets efficiently. For 
example, in response to the crisis, Malawi implemented a countrywide 
subsidy on the consumer price of maize to make it more affordable to 
the public. However, this policy, combined with high interest rates 
that inhibited the private sector from borrowing to cover its 
purchases, meant that the private sector could not profit from 
importing maize and selling it at the subsidized price. In Zambia, the 
government encouraged a program whereby a private sector group, the 
Millers Association, would import 300,000 MT of maize without having to 
pay import duties and the government would import 155,000 MT of maize 
to begin a strategic reserve. However, the Zambian government 
reportedly provided conflicting information about the amount of food it 
was to import for relief versus strategic reserves, thus causing 
confusion about planned imports, uncertainty over market prices, and 
conditions favorable for market speculation. In Zimbabwe, the 
government banned all private sector imports and implemented price 
controls on maize. This policy reportedly encouraged traders with food 
supplies to stockpile them or sell them at a much higher price on black 
markets in country or across borders.

[End of section]

Appendix VI: Nonfood Emergency Needs:

U.N. agencies requested $143.7 million to address urgent, nonfood 
humanitarian needs that increased people's vulnerability to famine for 
the July 2002 through June 2003 period. As of April 9, 2003, less than 
25 percent of the total identified requirements had been funded. Figure 
15 compares the sectors and dollar amounts for which the U.N. agencies 
requested funding to actual contributions. As the figure shows, the 
largest amounts were requested for health, agriculture, and economic 
recovery. Only five of the nine sectors received any funding and four 
of these were only partially funded. The four sectors with the highest 
rates of funding were: multi-sector, 583 percent of the requested 
amount; coordination and support services, 49 percent of the requested 
amount; agriculture, 35 percent; and health, 21 percent.

Figure 15: U.N. Nonfood Emergency Appeals and Contributions by Sector:

[See PDF for image]

[End of figure]

Funding requests were tied to specific projects. For example, the World 
Health Organization (WHO) asked for $2.9 million for projects in Malawi 
to enable earlier detection of epidemics, improve response to disease 
outbreaks in emergency situations, and strengthen emergency health 
coordination. FAO requested funding for an $8.5 million project in 
Zimbabwe to (1) increase agricultural production among 400,000 
vulnerable households by providing inputs such as seeds and fertilizer, 
(2) facilitate tillage, (3) rehabilitate local water sources, and (4) 
develop opportunities to market agricultural products.

[End of section]

Appendix VII: Biotech Food and the Southern Africa Food Crisis:

This appendix provides additional information on crops and foods 
produced with modern agricultural biotechnology, how concerns about 
agricultural biotechnology developed in southern Africa, and how issues 
surrounding agricultural biotechnology affected delivery of U.S. food 
aid during the southern Africa food crisis.

Modern Agricultural Biotechnology:

Modern agricultural biotechnology refers to various scientific 
techniques used to modify plants, animals, or microorganisms by 
introducing in their genetic makeup genes for specific desired traits, 
including genes from unrelated species. Genetic engineering techniques 
allow development of new crop or livestock varieties, since the genes 
for a given trait can be introduced into a plant or animal species to 
produce a new variety incorporating that specific trait. Additionally, 
genetic engineering increases the range of traits that can be 
introduced in new varieties by allowing genes from totally unrelated 
species to be incorporated into a particular plant or animal 
variety.[Footnote 50]

Crops and foods containing or derived from genetically modified (GM) 
plants have been characterized by various users as biotech, GM, 
genetically modified organisms (GMO), and bioengineered crops and 
foods.

Biotech crops currently on the market are mainly aimed at increasing 
crop protection by introducing resistance against plant diseases caused 
by insects or viruses or by increasing tolerance to herbicides. Biotech 
crops have lowered pest management costs and enhanced yields. By the 
end of 2000, such crops had been planted on nearly 100 million acres 
worldwide. As of 2000, the United States had 76.7 million acres of 
biotech crop varieties: 26 percent of all maize planted, 68 percent of 
cotton, and 69 percent of soybeans.

The United States and a number of other countries have established 
regulatory processes for assessing whether foods derived from 
agricultural biotechnology are as safe for humans, animals, other 
plants, and the environment as their traditional counterparts. Safety 
assessments of GM foods investigate direct health effects (toxicity), 
tendencies to provoke allergic reaction, nutritional effects, and any 
unintended effects that could:

result from gene insertion.[Footnote 51] Environmental assessments 
consider the ability of the GMO to escape and potentially introduce the 
engineered genes into wild populations; susceptibility of nontarget 
organisms (e.g., insects that are not pests) to the gene product; loss 
of biodiversity; and increased use of chemicals in agriculture. The 
environmental aspects vary considerably according to local conditions.

GM food such as whole kernel maize seed contains living modified 
organisms (LMO) that are capable of transferring or replicating genetic 
material. If maize is milled, this is no longer the case. Whole kernel 
maize seed can be eaten as a food or planted to grow a new crop.

Challenges to U.S. Agricultural Exports Containing Biotech Commodities:

U.S. agricultural biotech exports have faced several significant 
challenges in international markets. First, as the single, major 
producer of biotech products, the United States has been relatively 
isolated in its efforts to maintain access for these products.[Footnote 
52] Second, in many parts of the world, consumer concerns about the 
safety of biotech foods have increased, leading key market countries to 
implement or consider regulations that may restrict U.S. biotech 
exports. Third, in the United States, biotech and conventional 
varieties are typically combined in the grain handling system for more 
efficient use of crops from multiple sources.[Footnote 53] Thus, 
foreign regulations on biotech could affect all U.S. exports of these 
commodities as well as food products containing or derived from biotech 
crops. Specifically, regulations limiting or banning the importation of 
foods containing biotech products present serious challenges to U.S. 
exporters of corn and soy products, according to Department of State 
and USDA officials.

Several international organizations are involved in developing guidance 
on biotech food and its regulation. The Codex Alimentarius Commission 
(Codex)æa joint FAO/WHO body responsible for an international food 
code--has been developing principles for the human health risk analysis 
of biotech foods. These principles are based on a premarket assessment, 
performed on a case-by-case basis, that evaluates both direct effects 
(from the inserted gene) and unintended effects that may arise from 
inserting the new gene. The principles are in the final stage of an 
eight-step international agreement process. Draft language under 
consideration includes an option for mandatory labeling based on the 
method of production, even if there is no detectable presence of DNA or 
protein in the end product resulting from genetic modification. The 
United States and several other countries have opposed mandatory 
processed-based labeling for foods, which may contain the products of 
agricultural biotechnology. They favor mandatory labeling only with 
regards to allergic reactions, changes in nutritional content, and 
changes in handling requirements. Codex has been deadlocked on the 
labeling issue for several years.

The Cartagena Protocol on Biosafety, an international environmental 
treaty, regulates transboundary movements of LMOs. Biotech foods are 
within the scope of the protocol only if they contain LMOs. The 
protocol requires exporters to get consent from importing countries 
before the first shipment of LMOs intended for release into the 
environment. This requirement does not apply to LMOs intended for 
direct use as food, feed, or for processing.[Footnote 54] The protocol 
will enter into force 90 days after the 50TH country has ratified it, 
which may be in late 2003, according to a USAID official. The United 
States is not a signatory to the agreement. However, according to U.S. 
officials, as a practical matter U.S. exporters will need to observe 
and comply with local regulations implementing the protocol.

U.S. Versus EU Approval Process:

The United States and the European Union (EU) have very different 
regulatory frameworks for approving new agricultural biotech products.

The United States generally applies existing food safety and 
environmental protection laws and regulations[Footnote 55] to biotech 
products and approves them based on their characteristics rather than 
on whether they are derived from biotechnology. To evaluate new 
products, U.S. regulators require sufficient evidence to determine 
their safety or risk. Under this approach, the United States has 
approved most new biotech varieties.

The EU follows the "precautionary principle," under which the EU 
maintains that approval of new biotechnology products should not 
proceed if there is "insufficient, inconclusive, or uncertain" 
scientific data regarding potential risks. The EU has not approved any 
new biotech foods for marketing since 1998.[Footnote 56] This stance 
has affected the viability of biotech trade in other parts of the 
world. For example, given the importance of the EU market, U.S. soybean 
producers have been reluctant to introduce new biotech varieties not 
approved for marketing in the EU. Similarly, maize growers in 
Argentina, who export to the EU, are deferring planting a biotech 
variety known as "Round-up Ready" corn because the EU has not approved 
it. They are only planting biotech varieties approved by the EU.

Biotech Issues in Zimbabwe:

According to U S. officials, Zimbabwe raised concerns about the 
potential adverse environmental and commercial/trade impacts of 
unmilled biotech products as early as the summer of 2001, a year before 
the U.N.'s southern Africa appeal. It did not want planting of whole 
kernel biotech seeds or feeding of livestock on biotech products. In 
December 2001, the United States offered to provide 14,300 MT of maize 
to Zimbabwe, but the government refused, since it could not be 
certified as GMO-free. In January 2002, the United States agreed to 
provide 8,500 MT of fortified corn meal to Zimbabwe as an initial 
contribution to a WFP program launched in November 2001. Since this was 
a milled product that did not contain any living GMOs, the government 
accepted it.

In May 2002, the United States offered an additional shipment of 10,000 
MT of whole kernel maize for the WFP program. The government again said 
it would only accept contributions that included assurances that the 
food was not derived from GMOs. As a result, the maize was reallocated 
to Zambia, Malawi, and Mozambique.

Near the end of July 2002, Zimbabwe proposed to accept a U.S. offer of 
17,500 MT of maize that might contain biotech commodity. However, the 
maize would be temporarily stored in silos to be milled and 
subsequently distributed. In the meantime, the government would use its 
own maize for distribution, which would be packed into USAID food bags 
and distributed. This proposal became known as "the swap." Near the end 
of August, the United States approved the swap arrangement. However, on 
September 1, the Agriculture Minister of Zimbabwe was quoted as 
emphatically rejecting biotech food assistance.[Footnote 57] Four days 
later, though, the President approved accepting biotech maize, subject 
to special shipping, milling, and distribution requirements.[Footnote 
58]

Biotech Issues in Zambia:

In February and March 2002, WFP and U.S. officials notified Zambia that 
U.S. donations to that country would likely include maize containing 
biotech varieties. In June 2002, Zambia's Vice President said the 
country would gladly accept the U.S. maize Zimbabwe refused. However, 
during June and July a public debate on biotech food began and appeared 
to be backed strongly by the opposition political party. In August, a 
6-hour town meeting on the issue was held, and on August 16, the 
government decided to suspend all biotech imports and distributions.

After this announcement, the USAID Administrator invited seven Zambian 
scientists to visit the United States on a fact-finding mission 
regarding the biotech issue. The scientists came to the United States 
in September and subsequently visited South Africa and several European 
countries as well. Their report concluded that:

* distributing biotech maize carries a high risk of eroding local maize 
varieties;

* the safety aspects of biotech foods are not conclusive;[Footnote 59] 
and:

* there is a potential risk of biotech maize, if planted, affecting the 
export of baby corn and honey in particular and organic foods in 
general to the EU.

They recommended that the government continue its policy of not 
accepting biotech foods. On October 29, the Zambian government agreed.

Seven experts in the field of modern agricultural biotechnology 
reviewed the Zambian scientists' report for us. With regard to human 
health and safety issues, two experts found the report to be fair, 
accurate, and fact-based; two experts disagreed with this assessment; 
and three did not respond. Concerning environmental issues, three 
experts said the report was fair, accurate, and fact-based; two experts 
disagreed; one expert was not certain; and one did not respond. The 
experts generally agreed that cross-pollination, or gene flow, would 
occur between biotech and conventional maize plants, but disagreed 
about whether this warrants a ban on biotech maize. Four experts 
suggested that milling of biotech maize was a viable option for 
maintaining safety while simultaneously feeding the hungry; the other 
three did not comment on this issue. Overall, the experts supported the 
need for Zambia and other southern African countries to be able to 
assess GMOs in their environments.

U.S. Views and Approach:

During June 2002, the United States planned how it would respond to the 
biotech issue. It recognized that (1) Zimbabwe's rejection of whole 
kernel maize was a problem that had to be addressed, (2) other affected 
countries' positions on the import and transport of biotech food needed 
to be determined, and (3) it was important to provide information about 
biotech food. By early July, the United States was planning to use 
private and, if necessary, public diplomacy to get the affected 
countries to accept the biotech food aid. It would work with and 
through SADC and its members to remove barriers to biotech food aid and 
would support WFP in asking for humanitarian exceptions to current and 
proposed biotech regulations. When feasible, the United States would 
attempt to provide alternative food aid to countries that had bans on 
agricultural biotechnology in place. However, if recipient countries 
placed special regulations on biotech productsæfor example, milling or 
labeling requirementsæthey themselves would have to pay to implement 
these requirements. The U.S. government opposed agreeing to provide 
only milled biotech food aid because the process added costs and 
delayed shipments.

On July 25, 2002, the State Department directed its embassies in the 
six affected states and Botswana to stress to host governments the 
importance of addressing the region's immediate needs rather than 
engaging in protracted debate on the merits or supposed dangers of 
biotech food. State warned that recent decisions by some recipient and 
transit countries not to accept whole kernel biotech maize risked 
endangering the lives of millions of people. State advised U.S. 
missions to urge SADC member states to immediately adopt an agreement 
allowing unrestricted import and distribution of food aid, including 
biotech produce, on an emergency basis for the duration of the crisis. 
State's background and guidance to its overseas posts on biotech food 
aid included the following:

* Food that is exported from the United States, whether commercially or 
through food aid, is the same food eaten by Americans in terms of its 
GMO content.

* To date, there is no scientific evidence to suggest that commercially 
available biotech commodities and processed foods are any less safe 
than their conventional counterparts.

* Commercially produced bioengineered plant varieties in the United 
States have been reviewed under the U.S. regulatory process, which sets 
rigorous standards for human, animal, and plant health and for 
environmental safety. These varieties have received safety approval in 
a number of countries.

* Developing countries are concerned that genetically engineered genes 
may contaminate other farmers' fields or wild plants in the centers of 
origin, but this occurrence would not necessarily be negative or 
damaging. Genes naturally flow (through cross-pollination) between 
traditionally developed varieties and modern hybrids.

* Some African countries are concerned that if farmers plant whole 
grain U.S. food aid, their trade with the EU may be affected. At this 
point in time, the only whole grain in food aid that might contain 
biotech varieties is maize. If whole maize is planted, it is possible 
biotech varieties co-mingled in food aid could cross-pollinate with 
local varieties. However, it is unlikely that the biotech grain will 
grow well as it is made from hybrid seed and not well-adapted to 
conditions in southern Africa.

U.N. Response:

In May 2002, Executive Director raised the issue of biotech food 
aid with the U.N. Secretary General and in June briefed him on why 
biotech food aid was an impediment for operations in southern Africa. 
By early July 2002, the U.N. Under Secretary-General for Humanitarian 
Affairs had sought guidance from FAO, WHO, and WFP regarding food aid 
with biotech components. The FAO Director-General responded with a 
letter incorrectly citing the Cartagena Protocol as recommending that 
all food aid that might contain biotech products be subject to an 
"advanced informed agreement" and be milled before distribution to 
avoid the possibility of germination. However, the Cartagena Protocol 
expressly states that advanced informed agreement does not apply when 
the shipment is for direct use as food or feed, or for processing, nor 
does it suggest that grain shipments containing living biotech 
components be milled. After the United States raised concerns about 
this misinformation, the Director-General issued a correction 
letter.[Footnote 60] Nonetheless, the FAO representative in Malawi 
repeated the same erroneous recommendations to Malawi's Ministry of 
Agriculture. The United States again cited the error, but in August, 
the FAO representative in Zimbabwe gave similar inaccurate advice. This 
time, when the United States alerted FAO, the problem was quickly 
corrected, according to FAO.

On August 23, 2002, FAO, WHO, and WFP issued a joint U.N. statement on 
the use of biotech foods as food aid in southern Africa.[Footnote 61] 
Its key points included the following:

* Although there are no existing international agreements in force 
regarding trade in biotech food or food aid, WFP policy is that all 
donated food must meet the safety standards of both the donor and 
recipient countries and all applicable international standards, 
guidelines, and recommendations.

* FAO and WHO are confident that the principal country of origin (i.e., 
the United States) has applied its national food safety risk assessment 
procedures to its food aid and has fully certified that these foods are 
safe for human consumption. Based on national information from a 
variety of sources and current scientific knowledge, FAO, WHO, and WFP 
believe the consumption of biotech food now being provided as food aid 
in southern Africa is unlikely to present human health risk.

* Any potential risks to biological diversity and sustainable 
agriculture from inadvertent introduction of GMOs have to be judged and 
managed by countries on a case-by-case basis. In the case of maize, 
processing techniques such as milling or heat treatment may be 
considered to avoid inadvertent introduction of biotech seed. However, 
U.N. policy does not require that biotech grain used for food, feed, or 
processing be treated this way.

* Governments must carefully consider the severe and immediate 
consequences of limiting the food aid available for millions so 
desperately in need.

European Union Statement:

Several of the southern African countries were concerned that if whole 
kernel biotech maize were planted and used as feed for their cattle, 
their ability to export grain and cattle to the EU would be hampered. 
On August 28, 8 days after Zambia announced it would not accept biotech 
foods, the delegation of the European Commission in Zambia issued a 
press release to clarify its position, which stated the following:

* The United States, the EU, and others have evaluated several biotech 
maize varieties, and some have been authorized for use, including 
planting. Given the serious food shortages in the region, governments 
may want to use these evaluations rather than wait for them to be 
repeated locally.

* The fact that a country grows biotech maize has no impact on its 
ability to export other agricultural products to the EU.

* The importation and use of biotech maize in a form other than grain 
should eliminate concerns about negative biodiversity effects and trade 
consequences.[Footnote 62]

* EU scientists have found no evidence that the biotech maize varieties 
they have assessed are harmful to human health.

[End of section]

Appendix VIII: Comments from the Department of State:

United States Department of State Washington, D. C. 20520:

JUN 3 

Dear Ms. Westin:

We appreciate the opportunity to review your draft report, "FOREIGN 
ASSISTANCE: Sustained Efforts Needed to Help Southern Africa Recover 
from Food Crisis," GAO-03-644, GAO Job Code 320145.

The enclosed Department of State comments are provided for 
incorporation with this letter as an appendix to the final report.

If you have any questions concerning this response, please contact Lois 
Aroian, Bureau of African Affairs, at (202) 647-9849.

Sincerely,

Christopher B. Burnham 
Assistant Secretary and Chief Financial Officer:

Signed by Christopher B. Burnham:

Enclosure:

As stated.

cc: GAO/IAT - Wayne Ferris State/OIG - Luther Atkins State/AF - Walter 
Kansteiner:

Ms. Susan S. Westin, Managing Director, International Affairs and 
Trade, U.S. General Accounting Office.

Department of State Comments on GAO Draft Report:

FOREIGN ASSISTANCE: Sustained Efforts Needed to Help Southern Africa 
Recover from Food Crisis (GAO-03-644, GAO Code 320145):

The Department of State welcomes the opportunity to comment on the 
GAO's draft report on Foreign Assistance: Sustained Efforts Needed to 
Help Southern Africa Recover from the Food Crisis. The Department 
concurs with the report's general thrust, conclusions, and 
recommendations. In particular, the report showed that the food crisis 
was actually a complex humanitarian emergency of which food was just 
one element.

On the recommendations, the U.S. is taking steps to improve long-term 
food security throughout the world, not just in southern Africa. Our 
Missions overseas, through cooperative efforts between State and USAID 
and guided by their Washington agencies, already integrate agricultural 
development, HIV-AIDS awareness and action, and disaster management. 
Some of our Missions include an HIV-AIDS education component in each 
and every aid assistance program.

We have also been working with our partners in the G8 to create a new 
multilateral framework for preventing and mitigating the effects of 
famines so that communities will not have to sell all they have in a 
desperate --and too often unsuccessful --attempt to save their 
children's lives. We would like our G8 partners to commit to 1) 
increased food assistance to meet current emergency needs, 2) agreement 
to use more flexible approaches to addressing food crises (such as 
cash-for-work programs) and 3) long-term efforts to increase 
agricultural productivity. These efforts are critical because a global 
scourge needs a united global response.

The Department suggests that the report note at the outset that the 
U.S. anticipated the crisis, prepositioned food in the most vulnerable 
countries in order to meet it, and placed food in the pipeline so that 
it would arrive in a timely way (p. 4). The report should explain that 
the C-SAFE program resulted from a longer-term strategy that targeted 
the most vulnerable populations that the WFP program might miss (p. 
14).

In 2000, the Government of Zimbabwe initiated a chaotic and often 
violent land reform campaign (pp. 6, 8). This campaign was 
characterized by mob occupation of commercial farms and the forced 
expulsion of landowners and farm laborers. In many instances, 
landowners and farm laborers were deprived of all their personal 
possessions. The Government of Zimbabwe has actively blocked efforts by 
landowners to seek legal protection of their property and redress for 
their loss. At the same time, many commercial farms were taken over by 
senior Government of Zimbabwe officials and supporters. To date, no 
landowner has been compensated for seized land, and more than a million 
internally displaced farm laborers remain displaced. The result in 
2002-3 was that, once expelled from their lands, farm workers were left 
with no way to support or feed themselves, regardless of crop failure.

On the issue of food aid, containing bioengineered food, the Department 
works in conjunction with USDA, USAID and other agencies to coordinate 
outreach and capacity-building efforts to increase understanding of 
agricultural biotechnology and its related regulatory and policy 
issues. In this specific instance, the interagency working group on the 
southern Africa famine did develop alternative means to address the 
crisis once it became apparent that some countries might reject the 
food aid. When Zambia opted to reject the biotech corn, for example, 
the U.S. sent sorghum and bulgur. Such substitutions are often possible 
but are dependent on availability, and substitutes are often more 
expensive. Additionally, the U.S. tries to provide the staples usually 
consumed in the affected area, to the extent possible. An interagency 
review on how to manage the presence of bioengineered foods in food aid 
may be useful for developing a strategy; however, such a review should 
be narrowly focused to ensure better coordination between food aid, 
development, trade policy and regulatory agencies. Language to reflect 
this need would be more appropriate.

There are a number of inaccuracies in the report regarding biotech 
food.

The report characterized Malawi as a country that rejected biotech food 
(p. 22). In fact, Malawi readily accepted whole-grain biotech maize, 
asking only that the corn distributed during the planting season, a 
relatively short period, be milled. Much of the food aid that others 
did not accept ended up in Malawi.

The report referred to food being delayed in the ports because of the 
biotech impasse (p. 24), but actual port clogging was also a problem. 
Detailing of a port captain to address this problem helped clear the 
food aid through the ports.

The report mentioned the public debate and town meeting in Zambia that 
addressed the biotech food aid issue. As the report notes, this issue 
became politicized.

Proponents of accepting biotech food, scientists who sought to speak on 
the issue, were shouted down at the town meeting. The report contains 
no information about the active campaign of NGOs in Zambia and 
elsewhere to spread misinformation about biotechnology. Moreover, the 
U.S. provided extensive materials about agricultural biotechnology and 
the safety of biotech food aid to Zambia and the other countries 
affected by the food crisis. There is very little mention in the report 
of these numerous efforts.

We would urge a review of Appendix VII, "Biotech Foods" because it 
provides some inaccurate and incomplete information on bioengineered 
foods. The definition of genetically modified organisms (p. 49) is 
incorrect and should be re-defined as "organisms in which the genetic 
material (DNA) has been altered via introduction of foreign DNA using 
in vitro techniques." On the same page, the discussion of safety issues 
associated with biotech foods does not make clear that these are the 
types of potential issues that regulators and scientists consider 
before approving a product for commercial use.

The discussion of international organizations involved in work on 
biotechnology issues (pg. 50) confuses work ongoing in various Codex 
Alimentarius committees and incorrectly links work on risk assessment 
guidelines in the final stage of approval with the issue of labeling 
information, whether mandatory or voluntary. The paragraph on the 
Cartagena Protocol on Biosafety (p. 50) states that the Protocol will 
enter into force in 2004. Forty-eight countries have ratified the 
Protocol, leaving only two more for entry-into-force. It is expected 
that the final ratifications will be forthcoming by mid-2003, with the 
Protocol entering into force no later than December 2003.

As for U.S. compliance with the Protocol, we cannot be a signatory, so 
we have no rights or obligations under the Protocol; however, our 
exporters will most likely need to observe the requirements. Thus, we 
suggest that the report state that "as a practical matter the United 
States will need to act in a manner consistent with many of the treaty 
requirements.... Footnote number 40 (p.50) inaccurately summarizes and 
paraphrases the requirements of the Protocol pertaining to shipments of 
LMO's intended for direct use as food, feed, or for processing.

Finally, on page 51, the statement of Europe's use of the 
"precautionary principle" is not fully accurate. The definition of the 
principle in the report is only one manifestation of the use of this 
principle.

Please do contact us if you need further assistance.

The following are GAO's comments on the State Department's letter dated 
June 3, 2003.

GAO Comments:

1. We recognize that the United States is taking steps to help improve 
long-term food security in the region that include, among others, the 
Agricultural Initiative to Cut Hunger in Africa, which was introduced 
early last year. However, as noted in figure 11, overall assistance to 
the region's agricultural sector has declined between 1998 and 2003; 
and as of April 2003, only one out of the six countries (Mozambique) 
was proposed to receive funding under the new initiative. We also 
recognize that U.S. bilateral assistance in several of the affected 
countries has funded a number of programs related to food security over 
the years, including ongoing programs on agricultural development, HIV/
AIDS, and disaster management. While all these programs do help to 
promote food security, U.N. and U.S. officials told us that to have 
broad impact, these programs need to be implemented on a much larger 
scale. Our recommendation that U.S. agencies work with international 
organizations, donors, and national governments to develop a 
comprehensive, targeted strategy for sustained recovery would, if 
implemented, help coordinate efforts, integrate approaches, and 
leverage limited resources as necessary to achieve greater 
effectiveness.

2. We modified the text on pages 3 and 23 to note that the United 
States anticipated the crisis at the outset. Although the United States 
acted early so that food would arrive in a timely way, USAID officials 
advised us that no food was prepositioned in any of the countries. We 
modified the text on page 18 to reflect the point on the C-SAFE 
program.

3. We modified the text on pages 10-11 to reflect this information.

4. According to USAID officials, available quantities of sorghum and 
bulgur were limited.

5. We noted this view on page 46.

6. We modified our discussion of Malawi's policy on page 31.

7. We modified the text on pages 31 to reflect this point.

8. We replaced the definition, cited from a World Health Organization 
publication, with an alternative. See pages 3 and 65. We modified the 
discussion of safety issues on pages 64-65.

9. We modified the text on these several issues on page 67.

10. We clarified this footnote, on page 67, to indicate what 
information would be required in the initial documentation and what 
information would be required in subsequent exchanges of information.

11. On page 68, we changed our reference to the precautionary principle 
to clarify that the statements represent the EU's arguments under the 
principle.

[End of section]

Appendix IX: Comments from Department of Agriculture:

USDA:

United States Department of Agriculture:

Farm and Foreign Agricultural Services:

Foreign Agricultural Service:

Mr. David B. Gootnick:

Director, International Affairs and Trade U.S. General Accounting 
Office:

441 G Street, N.W. Washington, D.C. 20548:

JUN 3 2003:

1400 Independence Ave, SW Room 5071-S Stop 1001 Washington, DC 20250-
1001:

Dear Mr. Gootnick:

The U.S. Department of Agriculture (USDA) would like to thank the 
General Accounting Office for the opportunity to comment on draft 
report #GAO-03-644 entitled "FOREIGN ASSISTANCE: Sustained Efforts 
Needed to Help Southern Africa Recover from Food Crisis." USDA is 
pleased to provide the following three types of comments: (1) a 
response to the recommendations; (2) thematic comments regarding the 
draft report; and (3) specific comments on the draft report.

Response to Recommendations for Executive Action:

The draft report recommends "the Secretaries of State and Agriculture 
and the Administrator of USAID initiate a comprehensive review of the 
issues pertaining to biotech foods in emergency food aid." USDA agrees 
that all relevant parts of the U.S. Government must continue to review 
and engage other countries regarding their biotech policies, including 
those related to food aid.

Biotechnology and its acceptance are not new issues. In fact, the 
issues discussed in the report are identical to those issues faced by 
commercial exports of the same products in many of the same countries. 
USDA will continue to work closely with other U.S. Government agencies 
to ensure that efforts to address concerns are consistent with overall 
U.S. biotech policies. Specifically, USDA will continue to support 
developing countries' efforts to enhance their capacity for making 
science-based and transparent decisions regarding products of modern 
agricultural biotechnology. U.S. Government-wide efforts are 
substantial in providing technical assistance to developing countries 
that either have or might in the future face food aid needs. These 
range from long-term capacity building efforts associated with the U.S. 
Agency for International Development (USAID) programs to shorter-term 
projects such as USDA's Cochran Fellowship Program. These efforts 
remain a priority for providing a better global understanding of the 
regulatory issues associated with biotechnology and its acceptance 
since it is impossible to predict where the next food security crisis 
will develop. The challenge that must be addressed is building 
confidence in the existing safety evaluation systems for products of 
modern biotechnology, both in the U.S. and in other countries.

It is difficult to accurately identify countries that might accept or 
reject products of modern agricultural biotechnology. Given the rapidly 
advancing nature of the topic, many developing countries' policies 
depend upon the specific political, economic and social circumstances 
that might exist at the time. As the draft report accurately indicates, 
the policies and their implementation and application evolved over the 
course of the food aid crisis in southern Africa in 2002. However, the 
U.S. Government is committed to providing food under aid programs that 
always meets the health and safety requirements in the U.S. and the 
importing country.

USDA has always provided food aid recipients with a wide variety of 
products that are available to meet emergency needs. In addition, other 
factors are considered, including normal dietary patterns, availability 
and costs. All of the products that are provided under these programs 
meet all the health and safety requirements necessary for the products 
to be consumed in the U.S. There is no difference between those 
products provided under food aid programs and the safe and nutritious 
food consumed by millions of Americans every day.

Thematic Comments on the Draft Report:

The draft report, as written, attributes the problems that occurred in 
providing food aid to southern Africa directly to the food aid itself. 
However a more accurate representation would be that the countries in 
need of the food aid had non-transparent, non-science based or shifting 
regulatory regimes regarding biotechnology. U.S. policy regarding which 
commodities to provide as food aid and how to respond to food aid 
crises did not change. However, the policies of food aid recipient 
countries and their application did change, as is reflected in the 
report.

In the U.S., once a product of modern agricultural biotechnology is 
determined to be as safe as its conventional counterpart, it is allowed 
to circulate freely in the U.S. market. The U.S. Government does not 
make or require any distinction between "biotech" or "non-biotech" food 
for sale commercially or distribution through food aid channels. 
Therefore, the use of these terms in the draft report makes a 
distinction that does not exist under U.S. law or policy and is 
misleading. All food that is available under U.S. food aid programs, 
whether it includes biotech components or not, meets the same high 
safety threshold applicable to food available in the U.S. These 
decisions are scientifically based and transparent.

In responding to food security needs, the first and highest priority of 
the U.S. is to ship enough safe and nutritious food to feed hungry 
people. Providing alternatives to our current food aid programs to 
address non-science based requirements regarding biotechnology 
increases costs and the time required to deliver critical food needs. 
As a 
result, the amount of food that the U.S. can provide and the number of 
people we can help declines.

In addition, specific technical comments on the draft report are 
contained in Attachment A for your review and consideration.

In closing, I again want to thank you for allowing us to comment on 
this draft report. Please let us know if you would like to discuss our 
comments further.

Sincerely,

A. Ellen Terpstra 
Administrator:

Signed for A. Ellen Terpstra:

The following are GAO's comments on USDA's letter dated June 3, 2003.

GAO Comments:

1. We modified the text on page 30 to reflect this point.

2. We modified the text on page 66 to reflect the first point. Our 
draft report noted that the biotech and conventional varieties are 
typically combined in the U.S. grain handling system. Regarding the use 
of the term biotech, see pages 45-46.

[End of section]

Appendix X: Comments from the U. S. Agency for International 
Development:

USAID:



U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT:

JUN 9 2003:

Mr. David B. Gootnick:

Director, International Affairs and Trade U.S. General Accounting 
Office:

441 G Street, N.W. Washington, DC 20548:

Dear Mr. Gootnick:

I am pleased to provide the U.S. Agency for International Development's 
(USAID's) formal response to the draft GAO report entitled "Foreign 
Assistance: Sustained Efforts Needed to Help Southern Africa Recover 
from Food Crisis" (June 2003). It was reviewed by USAID's Office of 
Food for Peace (FFP), the Bureau for Economic Growth, Agriculture and 
Trade, the Bureau for Africa, and USAID Missions in southern Africa.

We appreciate your pointing out that the US food aid response in the 
early stages of the crisis was both substantial and timely. The United 
States Government (USG) recognized early in 2002 that the situation in 
southern Africa would require a very large food aid response, and 
immediately sought ways to ensure that initial shipments would arrive 
in southern Africa early in the crisis. As a result, the first shipment 
of food aid from the United States arrived in Durban, South Africa in 
May 2002. By December 2002, the United States had delivered over 
400,000 metric tons of food aid to the region, representing over 57% of 
the total food aid pledges through that period.

We agree with the observation stated in the report that most other 
donors were slow to pledge and then slow to deliver on their pledges. 
The USG continues to use various 
international and in-country fora to urge other donors to respond in a 
more timely and robust fashion to food security crises.

USAID agrees with the GAO recommendation to develop a comprehensive, 
targeted strategy to ensure sustained recovery 
from the southern Africa food crisis. The need for such a recovery 
strategy was identified early in the crisis in mid-2002. A Recovery 
Strategy/Action Plan that conforms to the GAO recommendation has 
already been drafted and is in the process of being reviewed by other 
USAID offices, other USG agencies, donors and non-government 
development partners. The draft strategy is already serving as a guide 
to the development and review of new USAID country strategies in 
southern Africa.

USAID supports the recommendation for further interagency discussion 
and coordination on the dimensions of biotechnology in food aid. Among 
the specific recommendations, USAID is actively engaged in supporting 
the development of capacity in a number of food aid recipient countries 
to make informed decisions about biotechnology. In practical terms, 
however, building such capacity is a long-term strategy and is unlikely 
to assist in emergency situations such as we saw in southern Africa. In 
almost all instances to date, developing countries have taken a year or 
more to conduct biotechnology regulatory reviews before issuing a 
decision. Thus, such reviews disrupt emergency food aid responses.

We believe the most practical solutions will be to work with recipient 
governments and partners involved in the delivery of food aid to build 
confidence in the existing safety:

evaluations of these products. This will include evaluations done in 
the U.S. by other countries, scientists, and international 
organizations such as WHO and FAO. Additionally, we note that in this 
instance, the impact on food aid delivery was not catastrophic because 
the impasse only occurred in one country. This allowed the United 
States and the WFP to re-route food and find complimentary donor 
support with relative success. If concerns with biotechnology occur on 
a larger scale, we will need to look at our food aid delivery options 
and not just consider biotechnology.

Thank you for the opportunity to respond to the GAO draft Report and 
for the courtesies extended by your staff in the conduct of this 
review.

Sincerely,

John Marshall:

Assistant Administrator 
Bureau for Management:

Signed by John Marshall:

The following are GAO's comments on USAID's letter dated June 9, 2003.

GAO Comments:

1. Currently in draft form, the recovery strategy/action plan USAID 
outlines in its comments represents a beginning. USAID notes that its 
draft strategy has already been useful as a planning tool in developing 
USAID's country strategies for the region. As such, the recovery 
strategy/action plan will help target U.S. efforts. However, our 
recommendation goes beyond U.S. efforts. To ensure sustained recovery 
in an environment of constrained resources, we believe there is a need 
for a comprehensive strategy that pulls together the efforts of 
international organizations, donors, and national governments; 
integrates approaches; and leverages limited resources.

[End of section]

Appendix XI: Comment from the World Food Program:

World Food Programme:

Programa Mundial de Alimentos:

Programme Alimentaire Mondial:

The Executive Director:

Via Cesare Giulio Viola, 68/70 00148 Rome:

Italy:

Phone: +39-06 5513.3030 Fax:	+39-06 6513.2834:

Internet: www.wfp.org:

2 June 2003:

Mr. David B. Gootnick Director:

International Affairs and Trade Attachment U.S. General Accounting 
Office:

441 G. Street:

N.W. Washington D.C. 20548 U.S.A.

Dear Mr. Gootnick:

I would like to begin by expressing my appreciation to the GAO for the 
opportunity to review and provide comments on its very important study, 
Sustained Efforts Needed to Help Southern Africa Recover from Food 
Crisis.

I was pleased to note that the GAO report reinforces many of the 
conclusions of the two interagency missions that I led to the region as 
the United Nations Secretary-General's Special Envoy for Humanitarian 
Needs in Southern Africa. Most notably:

The importance of understanding the linkages among food security, HIV/
AIDS and nutrition. Although this is an area where there has already 
been a considerable amount of research and advocacy, the southern 
African crisis is the first large-scale emergency where the need to 
look at the interface among these issues has been so compelling;

The need for the international community to urgently and radically 
alter the way it operates in southern Africa in the short and medium 
term. All agencies should review the appropriateness of their 
development and emergency operations in southern Africa because 
addressing the profound problems of the region will require a broad 
effort involving all key actors, including the United Nations, 
intergovernmental regional bodies, governments, International 
Financial Institutions, donors, large and small civil society 
organizations, activists and the private sector.

The report correctly notes that there was a wide range of factors that 
contributed to the 2002/2003-food crisis. While the report has captured 
most of the main ones, I would like to further highlight a few issues, 
which might provide an even more comprehensive understanding to 
readers.

1) There are two crucial factors that I would recommend be further 
highlighted - extreme poverty and regional economic decline. The report 
does touch briefly on 
Southern Africa's deep, structural poverty but stresses neither the 
role it played in exacerbating the food crisis in 2002-03 nor its 
contribution to ongoing food insecurity. The percentage of people 
living below the poverty line in all six countries is staggering (from 
42% and rising in Zimbabwe to over 60% in the other five affected 
countries). Faced by severe food shortages and rapidly escalating 
prices, most of the poorest families could not afford to buy what 
little food was available at local markets, especially as they had few 
- if any - household assets to sell. One of the reasons why the number 
of people in need rose during the 2002-03 crisis from an initial 
estimate of 12.8 million vulnerable people to 15.3 million was that 
rising prices left more and more households in need of food assistance 
because they lacked the financial means to purchase maize at market 
prices.

The region is battling with a host of serious economic problems, such 
as rising unemployment, which have increased people's vulnerability. 
Many of the countries have been severely affected by retrenchments in 
the South African mining industry, while the region as a whole has 
suffered from the dramatic economic collapse in Zimbabwe.

2) In the specific case of Zimbabwe, the report makes several 
references to land reform and the impact that it has had on 
agricultural production. However, the report could do more to mention 
Zimbabwe's economic woes, which have seen the country's Gross Domestic 
Product fall by more than 20 percent between 1998 and 2002 and 
unemployment rise by more than 25 percent over the same period. In 
2003, the economy is projected to decline by a further 14-16 percent. 
Meanwhile, inflation has now soared to over 269 percent. All of this 
has had a devastating impact on the country's population - both in 
rural and urban areas. Furthermore, the Government's lack of foreign 
exchange and price controls on basic commodities have caused shortages 
of everything from bread, milk, sugar and wheat flour to fuel and 
electricity.

On another issue, the GAO report is correct that there is a lag time 
between pledges and the arrival of commodities in country. The early 
months of EMOP 10200 would indeed have benefited from more rapid 
mobilization of resources. However, an important consideration in this 
regard is the nature of donor funding. Cash resources are much more 
quickly mobilized than in-kind contributions. I would urge that it be 
reflected in the report that WFP has purchased nearly 400,000 MTs of 
commodities regionally for this EMOP in the period through the end of 
April 2003.

We certainly would not wish the report to send out a message that, in 
the aggregate, donor response to this operation has been lacking. As of 
mid-May, the regional operation is 93 percent resourced and we have had 
an extraordinary range of donors in the crisis response. It is 
important to note that 41 different institutional donors contributed to 
EMOP 10200, including such notable non-traditional donors as South 
Africa, Algeria, Cameroon, Andorra, Oman, Malaysia, San Marino, 
Thailand, Singapore, the Nelson Mandela Foundation and the Latter Day 
Saints. Rather than reflecting poorly on the donor community, I would 
suggest that donors have been unusually supportive of EMOP 10200.

Hunger and chronic malnutrition cannot be resolved through periodic 
emergency appeals during those periods when food insecurity is most 
acute. WFP fully supports the conclusion of the GAO that this will 
require a sustained effort. Although it is perhaps stating the obvious, 
formulating a comprehensive strategy will not make a difference in the 
lives of those in southern Africa unless resources are made available 
to implement it. We have seen too often, in too many emergencies, that 
while there can be an extremely generous outpouring of external 
assistance to tackle the immediate manifestations of a crisis, it is 
much more difficult to maintain a similar level of engagement to 
address the longer-term structural and chronic factors, which 
contribute to such high levels of vulnerability.

In all that we do, our actions must concentrate on the needs of women 
and children as they are bearing the brunt of this crisis. As noted in 
the report of the second Special Envoy mission to the region. "The 
untenable burdens of domestic and informal-sector labour on African 
women and girls, coupled with their socially constructed vulnerability, 
low social and economic status and severely limited autonomy, must be 
addressed with full-scale and immediate interventions. The current 
willingness to assign additional responsibilities brought on by HIV/
AIDS to already overburdened women and girls threatens to undo the 
limited progress made to date towards gender equality. Necessary 
interventions range from legislation to uphold women's human rights, 
technological advances to reduce the physical and social toll of their 
labour, and financial or social compensation for labour assumed in the 
absence of social systems to deal with HIV/AIDS - related sickness, 
death, hunger and dependency".

In closing, I would like to again express our appreciation to the GAO 
for their efforts over the past eight months to better understand not 
only the factors contributing to this crisis and how together we have 
responded, but also helping to underscore the importance of continuing 
collaboration in tackling the longer term issues.

The World Food Programme looks forward to working together with the 
United States Government and all of our other partners in defining and 
implementing a sustainable recovery strategy.

Sincerely,

James T. Morris

Signed by James T. Morris:

The following are GAO's comments on the letter dated June 2, 
2003.

GAO Comments:

1. We agree with support for further collaboration with the U.S. 
government and other partners in defining and implementing a 
sustainable recovery strategy.

2. We further highlighted the problems of extreme poverty and regional 
economic decline on page 11.

3. We further highlighted Zimbabwe's economic problems on page 11.

4. We reflected these points on page 25.


[End of section]

Appendix XII: GAO Contacts and Staff Acknowledgments:

GAO Contacts:

Phillip J. Thomas (202) 512-9892 Wayne Ferris (202) 512-5169:

Acknowledgments:

In addition to the persons named above, Joy Labez, Miriam Carroll, 
Kendall Schaefer, and Janey Cohen made key contributions to this 
report. Nathan Anderson, Nima Edwards, Etana Finkler, Chase Huntley, 
Bruce Kutnick, Jeremy Latimer, Barbara Shields, and Eve Weisberg 
provided technical support.

(320145):

:

FOOTNOTES

[1] Depending on a country's policies, commercial imports represent the 
private sector, the government, or both. In some cases governments 
subsidize private sector imports.

[2] As used in this report, cereal refers to plants that yield grain 
suitable for food and includes maize, millet, sorghum, rice, and wheat.

[3] This figure reflects total production for these six countries in 
the 2001/02 season compared with average production over the previous 5 
years.

[4] Total cereal gap is calculated by estimating annual domestic cereal 
needs and subtracting the estimated harvest during the year plus cereal 
stocks at the beginning of the year.

[5] Modern agricultural biotechnology employs scientific techniques, 
such as genetic engineering, to modify plants, animals, or 
microorganisms by introducing desired traits in them, including 
characteristics from unrelated species. For example, traits may be 
introduced to facilitate pest management and improve yield or 
nutritional value. In this report, we refer to foods derived from 
genetically modified plants as biotech foods. (See app. VII and our 
evaluation of agency comments.)

[6] Food security is commonly defined as physical and economic access 
by all people at all times to enough food to meet their dietary needs 
for an active and healthy life.

[7] The maize crop cycle in southern Africa runs roughly from mid-
November (when crops are planted) through mid-April (when crops are 
harvested).

[8] Three assessments of the southern Africa food crisis were conducted 
between April 2002 and March 2003. The first round was a series of 
national Crop and Food Supply Assessment Mission (CFSAM) reports 
published in May 2002, which estimated that 12.8 million individuals 
would be at risk of starvation at the peak of the crisis. The second 
round, published in September 2002 as Emergency Food Security 
Assessment Reports, increased the at-risk estimate to 14.4 million 
people at the peak of the crisis. The third round of assessments, 
published in January 2003, increased the estimate to 15.3 million 
people.

[9] Nongovernmental organizations are nonprofit, private entities 
funded by private, governmental, and international organizations. NGOs 
are principal implementing partners in providing emergency food 
assistance.

[10] One hectare equals 2.47 acres.

[11] According to a study by the international NGO ActionAid between 
January and April 2002, at least 500 to 1,000 people died of hunger and 
hunger-related diseases in southern and central Malawi. WFP reported 
that more than 70 people died in the village of Gwengwe during that 
time--all victims of the district's severe food crisis. The 
Commissioner of Malawi's Department of Disaster Preparedness for Relief 
and Rehabilitation told us that his agency estimated 1,200 people died 
from hunger-related causes between December 2001 and June 2002.

[12] Based on 2001 year-end exchange rate: US$1=Malawi K 72.2.

[13] A 1992 study in Malawi found that a person infected with HIV/AIDS 
was estimated to work only 9.7 years out of a potential 25.3 years.

[14] To estimate this reduction, most studies rely on simulations of 
projected income growth in a case with HIV/AIDS and in a (hypothetical) 
case without HIV/AIDS. The results of these studies vary, primarily due 
to assumptions about how HIV/AIDS affects savings and investment rates 
and the skill composition of the labor force.

[15] The Vulnerability Assessment Committees, WFP, and others 
collected, analyzed, and reported considerable information on the 
cereal gap. However, complete data were unavailable because the VACs 
found it difficult to gather information on food aid provided by 
nongovernmental organizations.

[16] The May/June 2002 FAO/WFP CFSAM initially determined the annual 
cereal deficit for each country based on estimates of domestic cereal 
consumption and stock requirements and production. Subsequent VAC and 
other assessments revised these estimates, resulting in changes to 
cereal deficit estimates. A requirement to replenish 473,000 MT of 
cereal stocks by the end of the crop year was dropped, estimates of 
cereal production and opening stocks were revised upward by 539,000 MT, 
and estimates of domestic consumption needs were lowered by 425,000 MT; 
the latter revision was partly due to reduced population figures for 
Zambia and Zimbabwe.

[17] Given that the U.N. regional emergency food aid appeal used the 
original CFSAM emergency food aid targets, we derived the annual 
commercial import requirement by subtracting planned emergency food aid 
from the March 2003 revised cereal deficit, as provided to us by WFP.

[18] According to WFP, private traders operate primarily in urban 
markets. Sales are limited in rural markets due to low purchasing power 
among rural populations.

[19] The USAID-approved program authorized 160,000 MT of food aid to be 
provided during fiscal year 2003 to three of the six countries. The 
program did not establish a target amount of food aid to be distributed 
by the end of March 2003.

[20] On average for the 6-month period, WFP planned to assist 8 million 
people through large-scale general food and food-for-work 
distributions. This aid would go to families living in rural areas 
affected by adverse weather and whose coping strategies were depleted 
because of stress factors, including the increased burden of caring for 
family members affected by HIV/AIDs. WFP also planned to provide 
supplementary support to another 2.4 million people during the period, 
such as malnourished children, school-age children, and expectant and/
or nursing women who had needs above and beyond the levels needed to 
qualify for general food and food-for-work assistance.

[21] According to WFP, the food baskets were incomplete largely because 
of when pledged resources arrived as well as donor preferences for in-
kind contributions of certain commodities. Beans, oils, and corn/soya 
blend are often under-resourced.

[22] The Malawian VAC's July-August household survey found that adults 
were eating less than children and thus might experience a more rapid 
decline in nutritional status.

[23] The initial request for nonfood needs was for $104 million. 
However, specific requests for some countries and sectors were revised 
upward or downward during the year. As of early April 2003, the overall 
request was for $143.7 million.

[24] According to USAID officials, depending on the availability of 
commodities and shipping, as well as need in an affected country, USAID 
in-kind contributions can be provided in as short a time as 6 weeks.

[25] In addition, NGOs that were directly funded by the U.S. government 
carried out a similar operation.

[26] Crop varieties developed through the application of biotechnology 
to agriculture were first marketed in the United States in 1994. 
Because the U.S. grain handling system typically combines biotech and 
conventional maize varieties (for efficiency purposes), all U.S. food 
aid corn shipments possibly contained biotech maize. In 2002, roughly 
35 percent of U.S. food aid could be considered as having varying 
degrees of biotech content. See appendix VII for further discussion.

[27] Whole kernel maize, unlike its processed counterpart, has the 
possibility, if planted, of introducing engineered genes into 
conventional maize plants. 

[28] There is no worldwide, harmonized approach to assessing the safety 
of biotech foods and regulating their trade. Given the novelty of 
agricultural biotech products, many countries especially developing 
countries have no approval process for these products at all. The 
Cartagena Protocol on Biosafety, an international environmental treaty, 
will regulate transboundary movements of living genetically modified 
organisms after it is ratified by 50 countries, which may occur in late 
2003. Countries that ratify the protocol may establish their own 
national systems for assessing and regulating biotech foods.

[29] In 1999, media in Orissa, India, claimed the United States had 
dumped biotech food aid commodities on developing countries because 
European and Japanese markets would not buy them. In 2000, Sudanese 
politicians accused the NGO community of distributing biotech food aid 
and poisoning the Sudanese people. In 2001, the Ugandan government 
raised concerns about a program to distribute corn/soya blend rations 
to 60,000 people living with HIV/AIDS. In 2001, the Bolivian government 
seized biotech food aid following a decree forbidding imports of 
products derived from biotech crops. According to USDA, in each of 
these instances, USDA and/or USAID addressed the recipient country 
government's concerns and ensured that food aid reached those in need. 
In December 2001 and May 2002, Zimbabwe rejected U.S. offers to provide 
shipments of corn that could not be certified as 100 percent biotech 
free. According to ACDI/VOCA, an NGO specializing in development and 
food aid issues, through early 2002 most problems relating to biotech 
food aid had been resolved relatively quickly and amicably. See ACDI/
VOCA, Genetically Modified Food: Implications for U.S. Food Aid 
Programs (Washington, D.C.: Revised February 2002).

[30] According to USAID officials, the United States did not anticipate 
the biotech issue, since Mozambique and Zambia had accepted U.S. corn 
food aid for years. USDA officials said that it was difficult to 
determine with certainty those food aid recipient countries in southern 
Africa that would accept or reject food aid containing biotech 
commodities because of nontransparent, evolving decision-making 
processes.

[31] The United States provided about 280,000 MT of whole kernel maize; 
about 77,000 MT of corn meal; about 43,000 MT of corn soy blend and 
corn soy milk; and about 21,000 MT of vegetable oil made from either 
corn or soybeans. Altogether, about 84 percent of the donated U.S. 
tonnage could have contained biotech commodities. 

[32] According to USAID, in practice Malawi has preferred that whole 
kernel maize be milled prior to distribution but has not allowed its 
requirement to slow deliveries of food aid in any way and has only 
milled comparatively small quantities.

[33] According to WFP, 1 MT of cereal feeds approximately 60 people per 
month.

[34] Milling reduces the volume of the product. As a result, more whole 
grain maize must be supplied to meet the food needs of the 
beneficiaries.

[35] estimate of $80 per MT represents the rule of thumb for 
maximum costs, which include extraction rates during milling, 
additional transport, bagging, fumigation, and drying, as well as 
additional oversight. Actual total costs for milling, however, could 
not be calculated because milling is integrated into the overall 
procurement and logistics network.

[36] The private sector is also a source of agricultural investment in 
terms of capital (farm machinery and equipment) and technology (seed, 
irrigation, and soil conservation). However, little or no data are 
available to determine the size, growth, and impact of private sector 
investments on agricultural production in these countries.

[37] The projected food deficit is defined as the gap between projected 
domestically produced food supplies and projected food needs based on a 
basic nutritional requirement and projected population.

[38] GDP projections are from Global Insight's 2000 forecast and 
indicate annual growth rates from 2006 to 2020.

[39] One of the key Millennium Development Goals is the eradication of 
extreme poverty and hunger and cutting in half between 1990 and 2015 
the proportion of people whose income is less than $1 a day and the 
proportion of people who suffer from hunger. 

[40] These countries are required to develop Poverty Reduction Strategy 
Papers (PRSP) as the basis for assistance from the World Bank and IMF 
under the Initiative for Highly Indebted Poor Countries, where official 
creditors agree to help the most indebted countries obtain debt relief. 
In addition to these three countries, Lesotho has prepared an Interim 
PRSP and should issue a full PRSP this year. 

[41] Burkina Faso, Chad, Eritrea, Ethiopia, Kenya, Mali, Malawi, 
Mauritania, Mozambique, Niger, Rwanda, Somalia, Southern Sudan, 
Tanzania, Uganda, Zambia, and Zimbabwe.

[42] Early warning systems often rely on data supplied by the 
governments of the countries in question.

[43] The SADC Vulnerability Assessment Committee, established in early 
1999, is a committee of national professionals working at the regional 
level to enhance food security and livelihood conditions within the 
SADC member states. In August 2001, SADC Ministers of Agriculture 
encouraged member states to establish cross-sectoral and interagency 
vulnerability assessment groups to better understand food security and 
livelihood conditions of vulnerable communities and better target 
emergency and development interventions. The SADC VAC coordinates and 
backstops the national committees.

[44] The U.S. contribution to the southern African region was 
consistent with its global food aid performance in recent years. For 
example, from1992 through 2001, the United States accounted for an 
average 58 percent of global food aid deliveries, ranging between 45.9 
percent in 1995 and 68.8 percent in 1999. 

[45] Together, the six operations were designed to assist 4.8 million 
people.

[46] One factor that reportedly affected the availability of commercial 
imports was the drop in maize production in South Africa, a primary 
supplier of maize to regional markets. South Africa's average maize 
production in 2001 and 2002 was 9 percent lower than the previous 5-
year average (from 1996 to 2000).

[47] Maize prices fluctuated throughout the season and region. In 
Malawi, maize prices reached unprecedented levels during the pre-
harvest period. In Zimbabwe, the price of maize on the black market 
rose by 167 percent from August to December. In Mozambique, November 
2002 prices were generally higher than 2001 prices in four of seven 
provinces surveyed, but the same or lower in the other three provinces.

[48] The January 2003 VAC regional report concluded that Zimbabwe faced 
the greatest challenge of the six countries for purchasing required 
imports. Zimbabwe has been experiencing an economic crisis as its 
annual inflation rate has reached 180 percent and its gross domestic 
product has declined by 12 percent in 2002.

[49] The May 2002 FAO/WFP CFSAM initially estimated the annual cereal 
deficit for each country and how much of that could be met by 
commercial imports, with the remainder to be offset by emergency food 
aid. Subsequent VAC reports updated estimates of the cereal deficit as 
well as domestic cereal and stock requirements and production. Given 
that the U.N. regional emergency food aid appeal used the original 
CFSAM emergency food aid targets, we derived the annual commercial 
import requirement by subtracting planned emergency food aid from the 
March 2003 revised cereal deficit.

[50] U.S. General Accounting Office, International Trade: Concerns Over 
Biotechnology Challenge U.S. Agricultural Exports, GAO-01-727 
(Washington, D.C.: June 15, 2001).

[51] In May 2002, GAO reported on biotechnology experts' views on the 
adequacy of tests used to evaluate potential health risks associated 
with genetically modified foods. Experts we contacted agreed that the 
regimen of tests used is adequate in assessing the safety of such 
foods. See U.S. General Accounting Office, Genetically Modified Foods: 
Experts View Regimen of Safety Tests as Adequate but FDA's Evaluation 
Process Could Be Enhanced, GAO-02-566 (Washington, D.C.: May 23, 2002).

[52] According to USDA officials, more than 17 countries currently 
produce biotech agricultural commodities. According to a USAID 
official, an estimated 20 percent of the Brazilian soy crop and 20 
percent of South Africa's yellow maize are bioengineered.

[53] Once a product of modern agricultural biotechnology is determined 
to be as safe as its conventional counterpart, it is allowed to 
circulate freely in the U.S. market.

[54] For these products, the protocol establishes procedures for 
countries to exchange information. According to the protocol, the 
initial documentation should clearly identify that the shipment "may 
contain" LMOs that are not intended for intentional introduction into 
the environment and contain a point of contact for further information. 
Subsequent information that will be placed on an international data 
base should contain information such as the characteristics of LMOs; 
any national laws, regulation, or guidelines on LMOs; and other related 
information.

[55] The U.S. system involves coordination among USDA, the 
Environmental Protection Agency, and the Food and Drug Administration.

[56] According to a U.S. official, the EU has had a moratorium on new 
approvals, which goes a step beyond merely applying precaution to each 
regulatory decision.

[57] The swap never took place because the Zimbabwe government did not 
fulfill its part of the agreement, according to USAID officials. 

[58] According to U.S. officials, as of late February 2003, WFP had 
milled more than 41,000 MT of U.S. maize in Zimbabwe and some U.S. 
maize destined for Zimbabwe in South Africa. WFP was expecting that all 
U.S. corn stored in the region would be milled and transported to end 
sites by the end of March or early April.

[59] Issues include concerns related to toxicity, allergenicity, and 
antibiotic resistance.

[60] The Director-General advised U.S. officials that it was still 
possible that material imported for food, feed, or processing purposes 
could be used as seed or that spillage could occur, which might lead to 
propagation of the GMO in the country of import or transit. Processes 
such as milling, he noted, make germination impossible.

[61] According to WFP officials, Executive Director was tasked to 
negotiate drafting of the statement. 

[62] Although the EU statement indicated Zambia's acceptance of biotech 
maize would not legally undermine its ability to export biotech maize 
to the EU, private entities could add restrictions that might affect 
such exports..

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