[From AP Business News, posted on MSN Money]
NAIROBI, Kenya (AP) - A humanitarian group has turned down $46 million worth of U.S. food aid, arguing that the way the American government distributes its help hurts poor farmers.
CARE said wheat donated by the U.S. government and sold by charities to finance anti-poverty programs results in low-priced crops being dumped on local markets and small-scale growers cannot compete.
Other experts said they share CARE's concern, but stressed that food donations are sometimes needed when a natural disaster harms a local area's agriculture, such as the flooding that North Korea says has devastated vast tracts of its farmland.
The Atlanta-based CARE agreed with that view. "We are not against emergency food aid for things like drought and famine," spokeswoman Alina Labrada said Thursday.
But, she added, the donation of wheat and other crops does not help in regions where people consistently go hungry because local farming has been weakened by international competition. "They are being hurt instead of helped by this mechanism," she said.
Labrada said such areas would be helped more if the U.S. and other donors gave cash that could be spent on locally produced crops, which would stimulate agricultural expansion.
The United States Agency for International Development said Thursday that its experts carry out detailed assessments to try to ensure that commodities do not disrupt local production. Jim Kunder, USAID's acting deputy adminstrator, said $375 million is the approximate average cash value of commodities that are donated for sale.
CARE decided in 2005 to phase out accepting grain donations within four years, but the move is gaining new attention because of the current debate in the U.S. Congress over the Farm Bill, which is reauthorized every five years.
"This is a crucial time. It will set policy for the next five years," Labrada said.
The U.S. farm sector and the maritime industry are the biggest supporters of the current system. The program soaks up surplus farm production, and shippers get lucrative contracts to transport donated grain for sale in needy regions.
The U.S. Government Accountability Office published a study in April saying that emergency American food aid takes an average of 4.5 months to arrive and that legal requirements mean two-thirds of the money spent by the government on food aid goes for packing and shipping.
Washington spends an average of $2 billion on food aid programs a year, mostly funneling the help through the United Nations' World Food Program. According to some aid groups, if the U.S. gave its aid in cash rather than food, it could support about twice as many people.
In the last two farm bills, the U.S. administration called for a partial shift to cash donations instead of grain, but that was voted down by farm supporters.
According to the International Center for Trade and Sustainable Development, the U.S. administration's proposals for future farm spending call for 25 percent of the food aid budget to be in cash.
The European Union has spoken out strongly against U.S. food aid policy in the Word Trade Organization, accusing Washington of using such programs to skirt rules limiting agriculture subsidies.
Christian Rasmussen, at the EU's agriculture directorate in Brussels, Belgium, said the bloc had replaced food aid with cash to ensure help gets to poor countries more quickly.
"It ensures a correct diet, because you also try to buy the proper products. It's also very cost effective because you can buy the food close to the market, unlike in the U.S. case," he said.
Like aid groups, African farmers are divided.
Ousmane Ndiaye, director of the farmer and rural worker group in the West African nation of Senegal, said dumping cheap crops undermines local agriculture.
"We have the resources that we need to nourish our population. We have land. We have men and women with the capacity to do it," he said. "We have millet here. But instead of buying the millet that comes from the middle of Senegal, some people prefer to buy sorghum from foreign countries."
In neighboring Mali, however, the secretary-general of the farmers association said foreign aid helps Malians get crops that aren't produced locally.
"We farm wheat in the north of Mali, around Timbuktu. But that's not enough for all the flour we need for bread," said Fousseyni Traore. He said Mali could never produce enough wheat because its southern areas are too wet and tropical.
The Minnesota-based Institute for Agriculture and Trade Policy said that in 2001, the sale of donated American grain provided 30 percent of U.S. aid groups' gross revenues, totaling $1.5 billion.
Tom Getman, executive director for international relations at the aid group World Vision, said he shared CARE's concern about the system but didn't want to turn away any kind of aid.
World Vision also is pushing to get more cash donations and less food, "because we've all gotten more and more anxious about how much it costs to do the shipping and the mixed results on the ground," Getman said.
"But there is going to be a continuing need, like in (North) Korea right now, where we've got to have food available for emergency situations. So it's just finding the balance that is so tough."