A partnership to eradicate rural poverty - IFAD

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OPEC countries and the origins of IFAD In the mid-1970s, a world food crisis demanded quick action to avert mass starvation, and to address the underlying causes of hunger and malnutrition over the long term. In response, international leaders met at the United Nations World Food Conference in Rome in 1974 to discuss the complex dimensions of the food crisis and the measures needed to achieve global food security. They explored initiatives that could forge new partnerships and mobilize additional resources. One of these initiatives was a proposal to create a new agency, IFAD, that would focus on the poorest and most vulnerable people in the world: rural poor people. But a major stumbling block remained: where would the resources come from? Traditional donors, while in favour of the proposed new agency, were reluctant to give more. The willingness of OPEC countries to provide a substantial portion of IFAD’s initial funding was one of the turning points leading to the establishment of the new institution. By committing significant financial resources, the OPEC countries also leveraged a ground-breaking agreement by which developing countries would have a prominent role in the governance of IFAD. An initial target was set for US$1 billion, with the understanding that OECD countries and OPEC countries would contribute the bulk of the funding, but that other developing countries would also contribute. This new fund would also have a unique power-sharing arrangement. Equal voting power would be shared among the three categories of members: OECD countries, OPEC nations and other developing countries. 6
Transforming this idea into reality required persistent and protracted negotiations. OPEC countries generously agreed to provide almost as large a share of contributions as the OECD countries. OECD countries were convinced of the value of participating in a fund where they would not have full control over decision-making. In the end, OPEC countries pledged US$435.5 million, OECD countries US$569 million and other developing countries US$20.6 million. The OPEC Fund provided an additional US$20 million from its resources for the First Replenishment. Given the relative size of the GDP of its member countries, compared to that of OECD countries, the contribution from the OPEC countries was an extraordinary gesture. When the majority of participants signed the agreement establishing IFAD in 1976, it was a victory for all and a milestone in international development. For the first time, an agency would focus exclusively on the most overlooked and marginalized poor people – those living in rural areas of developing countries. OPEC leaders reaffirm their commitment to combat poverty In September 2000, a few weeks after the Millennium Summit, leaders of OPEC member countries met for OPEC’s Second Summit of Heads of State and Government, held in Caracas, the Bolivarian Republic of Venezuela.Their Caracas Declaration reiterated the solidarity of OPEC nations with the rest of the developing world.The OPEC nations pledged to continue to help meet the needs of poor countries through individual and multilateral aid programmes, and through the partnership between IFAD and the OPEC Fund. The Declaration also stated that economic and social development and the eradication of poverty should be the overriding global priority. OPEC leaders urged the industrialized countries to recognize that “the biggest environmental tragedy facing the globe is human poverty”. Also for the first time, OPEC countries acquired a decisive role in determining international development priorities through their governance role in a multilateral development institution. OECD countries were pleased to have OPEC resources available to finance programmes and projects. And developing countries knew they would have valuable allies in OPEC nations. Even today, IFAD remains one of the few major multilateral development finance organizations in which OPEC and other developing countries hold a majority of the votes. 7
Page 1 and 2: IFAD AND THE OPEC FUND A partnershi
Page 3 and 4: Making a difference in the fight ag
Page 5 and 6: Foreword It is 30 years since OPEC
Page 7: With support from their crew leader
Page 11 and 12: Gender matters This is especially t
Page 13 and 14: Reversing land degradation through
Page 15 and 16: Each partner focuses on certain sec
Page 17 and 18: IFAD AND THE OPEC FUND COFINANCE PR
Page 19 and 20: Improved irrigation and better anim
Page 21 and 22: IFAD AND THE OPEC FUND JOINTLY SUPP
Page 23 and 24: Cover photo: A man prepares vegetab

A partnership to eradicate rural poverty - IFAD

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