[House Report 105-681]
[From the U.S. Government Publishing Office]
105th Congress Rept. 105-681
HOUSE OF REPRESENTATIVES
2d Session Part 1
_______________________________________________________________________
AFRICA: SEEDS OF HOPE ACT OF 1998
_______
August 6, 1998.--Ordered to be printed
_______________________________________________________________________
Mr. Gilman, from the Committee on International Relations, submitted
the following
R E P O R T
[To accompany H.R. 4283]
[Including cost estimate of the Congressional Budget Office]
The Committee on International Relations, to whom was
referred the bill (H.R. 4283) to support sustainable and broad-
based agricultural and rural development in sub-Saharan Africa,
and for other purposes, having considered the same, report
favorably thereon without amendment and recommend that the bill
do pass.
Committee Action
markup of the bill
The bill was introduced on July 21, 1998 and referred to
the Committee on International Relations. The Full Committee
marked up the bill in open session, pursuant to notice, on July
22, 1998. On that date the Committee by voice vote ordered the
bill reported to the House with the recommendation that the
bill do pass.
rollcall votes on amendments
Clause (2)(l)(2)(B) of rule XI of the Rules of the House of
Representatives requires the record of committee rollcall votes
on final passage or amendments during the committee's
consideration of H.R. 4283. No such rollcall votes were taken.
background and purpose
H.R. 4283, the Africa: Seeds of Hope Act of 1998 was
introduced on July 21, 1998 by Mr. Bereuter, Mr. Hamilton and
Mr. Gilman making changes to the text of the precursor bill,
H.R. 3636 (introduced by Mr. Bereuter and Mr. Hamilton).
Senator DeWine introduced a companion bill, S. 2283. H.R. 4283
provides policy guidance for U.S. assistance programs to focus
on the rural African entrepreneurs and continue relief feeding
programs and strengthens the availability of food reserves for
humanitarian assistance.
the problem
According to the United Nations Food and Agriculture
Organization (FAO), the number of people in sub-Saharan Africa
with inadequate access to food has doubled to 215 million since
1973. If current trends continue, FAO estimates the number will
increase by 50 million people over the next 12 years.
The U.S. Agency for International Development (AID) reports
that over 75% of the people in sub-Saharan Africa are farmers
tilling no more than five acres of land. Up to 80 percent of
Africa's domestic food supply is produced by women. Because so
many Africans depend on agriculture, both for their food and
for their livelihoods, investments in small farmers and rural
entrepreneurs (especially women) could make a critical
difference to millions of people on the continent.
In most African countries, agriculture suffered from
decades of neglect and poor management by colonial, military
and socialist governments. Conflict and civil strife, crippling
debt and lack of rural roads and infrastructure exacerbated
these problems.
Lack of access to credit impeded agricultural development.
Farmers require loans for seeds, tools and fertilizer long
before they can generate income from the harvest. Most African
farmers lack access to advanced agricultural methods that would
help them increase production. The International Food Policy
Research Institute cited the continuing neglect of Africa's
small farmers as the ``root cause'' of the continent's chronic
food insecurity.
Progress will be neither easy nor quick, but many signs of
hope demonstrate that conditions in Africa can improve. Life
expectancy rates are gradually improving and child mortality
rates have dropped dramatically, though there is still much
progress to be made. The number of students enrolled in primary
schools and universities increased. More African nations held
democratic elections than ever before.
Market-based economies are replacing highly-centralized
economies and the residues of socialist administration. While
overall economic progress is slow in some countries, ten sub-
Saharan Africa's economies had growth rates of more than 10
percent per year in 1996.
Since the 1980s, non-governmental organizations (NGOs)
blossomed throughout Africa. These groups demonstrate new and
successful approaches to development and provide voices for
communities that must be included in any effective development
strategy.
trade and aid
H.R. 4283 complements H.R. 1432, the African Growth and
Opportunity Act. During the consideration of the African Growth
Act, the U.S. government re-examined its policy emphasizing
traditional aid programs for Africa. Both Congress and the
Clinton administration joined in pursuing initiatives that urge
more African governments to adopt market-based, private-sector
growth policies based on open trade and investment
opportunities for U.S. businesses. Total U.S. trade with sub-
Saharan Africa, at $22.6 billion in 1997, far exceeds trade
with the former eastern bloc. Sub-Saharan Africa's trade with
Russia, Poland, Hungary, and Ukraine combined totaled $11.8
billion in 1997. Such trade and investment opportunities help
raise Africans' standard of living and offer the only long-term
hope for the economy of the region.
Improvements in income through trade and investment will
take time and will favor urban areas. The Africa: Seeds of Hope
Act will complement this development by focusing on the need
for broad-based growth in the area of economic activity that
employs the largest number of Africans--agriculture. While the
most promising prospects for the African economy are in cities
under governments open to trade and investment, the
international community cannot ignore the needs of farmers and
people who live in rural areas. These people represent a
majority of Africans, yet have the lowest incomes and suffer
from the worst food shortages in the world. By focusing
resources on farmers, the bill works to ensure the long-term
political stability and economic growth of the region. In sum,
H.R. 4283 is based on three principles: Service to the needs of
small-scale farmers (most of whom are women), small-scale
entrepreneurs, rural workers and communities; Consultation with
hungry and poor people about decisions that affect their lives;
and Participation of Africans, especially local communities, in
planning and carrying out development programs.
u.s. assistance programs for africa
U.S. bilateral assistance through AID's Development Fund
for Africa (DFA) totals less than half of total U.S. aid to the
continent.
Estimated U.S. Aid For Africa, Fiscal Year 1997
Dollars in millions
Bilateral (incl. DFA, Peace Corps, etc.)...................... $1,030.7
Peacekeeping.................................................. 13.0
African Development Foundation................................ 11.5
Refugees...................................................... 129.3
Emergency Refugee Account (ERMA).............................. 37.0
Disaster Assistance (OFDA 1996)............................... 62.0
World Bank (IDA).............................................. 405.0
UN Development Program (1996)................................. 19.8
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________________________________________________
Total..................................................... 1,709.3
The DFA is the main U.S. government assistance program for
the poor of Africa. The DFA guidelines first appeared in the
conference report (H. Rept. 100-498) accompanying the FY1988
appropriations legislation and were enacted into permanent law
in 1990 (P.L. 101-513, Section 562) as Chapter 10 of Part I of
the Foreign Assistance Act of 1961.
Under Chapter 10, part of the DFA is to be used to support
food assistance and food security needs. Chapter 10 requires
that the DFA be used to ``promote sustained economic growth,
encourage private sector development, promote individual
initiatives, and help to reduce the role of central governments
in areas more appropriate for the private sector.'' Chapter 10
stresses local involvement and ``grassroots'' development, but
it permits aid in support of economic policy reforms that
promote several ``critical sectoral priorities.'' The
priorities are agricultural production and natural resources,
with an emphasis on promoting equity in rural incomes; health,
with emphasis on maternal and child health needs; voluntary
family planning services; education, with an emphasis on
improving primary education; and income-generating
opportunities for the unemployed and underemployed. In
addition, Chapter 10 authorizes aid for regional integration
and donor coordination.
The DFA, with its broad phrasing and support for long-term
funding, gave AID flexibility in designing the Africa-
assistance program. However, Congress included guidelines
stating three activities should stand out (a minimum of 10% of
DFA funds should be devoted to each): agricultural production,
health, and voluntary family planning services.
The DFA was last earmarked by Congress in the FY1995
appropriations, and the Administration, in its proposed FY1999
Budget, no longer seeks a DFA earmark. Rather, the Budget notes
that ``beginning in 1996, development assistance for Africa has
been appropriated under the Sustainable Development Assistance
and Child Survival and Disease Programs accounts.'' (Budget
Appendix, p. 947.) After FY1995, it became customary for
analysts and others to refer to all Development Assistance for
Africa as ``DFA'' even though there was no earmark, but whether
this practice will continue remains to be seen. According to
AID, the provisions of Chapter 10 govern the development
assistance fund for Africa, whether or not there is an earmark.
food assistance programs
Food aid to Africa fluctuates in response to the
continent's needs. In FY1993, when a major drought afflicted
eastern and southern Africa, food aid amounted to 43% of
bilateral aid, but in FY1994, when conditions improved, it
dropped to 27%. Most of Africa's food aid is in the form of
emergency grants given under Title II of the P.L. 480 program.
This program is implemented by AID in cooperation with the
Department of Agriculture. On rare occasions, countries in a
position to repay are given long-term, low-interest loans to
purchase food under Title I of P.L. 480.
Some of Africa's poorest countries received U.S. food
donations under Title III, entitled ``Food for Development,''
which can be used in feeding programs or sold on the open
market, with proceeds to be used for development purposes.
Title III programs are underway in Ethiopia, Eritrea, and
Mozambique. In addition, a few countries benefitted under Sec.
416(b) of the Agricultural Act of 1949, as amended, which
permits donations of surplus food to developing countries,
emerging democracies, and relief organizations.
Assistance under these programs can also help the U.S.
farmer. The U.S. Department of Agriculture (USDA) forecasts
that U.S. agricultural exports will fall to $55 billion in
FY1998, $2.4 billion less than the $57.4 billion shipped last
year. USDA's forecast reflects a decline in U.S. exports to
East and Southeast Asian countries currently experiencing
financial difficulties and increased global competition for
U.S. corn and wheat exports. Agricultural exports are important
to both U.S. farmers and the U.S. economy. Production from more
than a third of harvested acreage is exported, including an
estimated 55% of wheat, 43% of rice, 35% of soybeans, 18% of
corn, and 32% of cotton. About 17% of the value of agricultural
production is exported.
Exports generate economic activity in the non-agricultural
economy as well. According to USDA, each $1.00 received from
agricultural exports in 1996 stimulated another $1.38 in
supporting activities to produce those exports. Agricultural
exports generated an estimated 895,000 full-time civilian jobs,
including 562,000 jobs in the non-agricultural sector. In
contrast to the large, continuing overall trade deficit, U.S.
agricultural trade consistently registers a large export
surplus.
Nearly every state exports agricultural commodities, thus
sharing in export-generated employment, income, and rural
development. In 1996, the states with the greatest shares in
U.S. agricultural exports by value were California, Iowa,
Illinois, Texas, Nebraska, Kansas, Minnesota, Washington,
Indiana, and Arkansas. These 10 states accounted for 58% of
total U.S. agricultural exports. In addition, Florida, Georgia,
Missouri, North Carolina, North Dakota, Ohio, South Dakota, and
Wisconsin each shipped over $1 billion worth of commodities.
recent administration policy
The Clinton Administration set its own ``strategic
objectives'' for development aid. AID's FY1995 congressional
presentation identified four of these--building democracy,
stabilizing population growth, protecting the environment, and
achieving broad-based economic growth--as most appropriate for
Africa. It did not specifically include agriculture in its top
priorities. During the past decade, AID's support for the
agricultural sector has declined from 36% of the Africa Bureau
budget to less than 15%. In 1985, the bureau employed 258
professional agricultural staff. Today, AID reports only 75
staff.
In the FY1998 presentation, the growth objective--rephrased
as ``broad-based economic growth with equity'' was listed
first, while ``fostering democracy and participation'' was
listed as the fourth objective. A fifth objective is to provide
``emergency relief to help nations make the transitions from
crisis to long-lasting development.'' AID's annual
presentations relate DFA expenditures in each country to these
strategic objectives rather than to specific provisions of the
DFA legislation.
AID officials testified that the United States has had a
number of successes in promoting sustainable development and
democracy, pointing to Ghana, Uganda, Zambia, Mali, and South
Africa as examples where sustained AID projects and programs
helped move the democratization process forward. Some programs
have not been as successful, for example, in Zambia. AID also
terminated assistance when there are persistent problems, as
has happened with Togo, or directed aid solely through NGOs, as
in Nigeria.
In agriculture, AID reports that the DFA helped liberalize
agricultural markets, increase smallholder production; and
facilitate the development of new seed varieties. AID used the
DFA to assist governments undertaking macro-economic reforms,
including reductions in the size of government bureaucracies
and the privatization of government enterprises.
The Administration launched several development initiatives
in Africa this year. The Greater Horn of Africa Initiative
(GHAI), aimed at easing the perennial food insecurity in a
region extendingfrom Eritrea and Ethiopia to Tanzania, promotes
collaboration and consultation on food security strategies. The
Initiative for Southern Africa (ISA), which will total $300 million
over five years, reflect's AID's recognition of the region's economic
potential and its desire to reinforce South Africa's democratic
transition as a model for the rest of the continent. In addition, the
Leland Initiative is a 5-year $15 million program aimed at connecting
20 sub-Saharan countries to the Internet.
President Clinton made a number of announcements and
proposals with respect to Africa assistance while visiting six
countries in the region from March 22 through April 2, 1998. It
appears that most of the funding for these initiatives will
come from either existing programs or would be provided under
the Administration's FY1999 foreign assistance request, which
was submitted to Congress before the President's departure.
Some initiatives extend over two years, so that additional
funds would have to be requested in early 1999 for FY2000. The
President's initiatives included the following:
$120 million over two years for an Education for
Development and Democracy Program. ($26 million in DA
and $10 million under the Economic Support Fund (ESF)
had already been requested in the Administration's
FY1999 Congressional Presentation on assistance to sub-
Saharan Africa. The Administration plans that other
resources will be contributed in FY1999 by the U.S.
Information Agency ($5 million), the Peace Corps ($10
million) and the food aid program ($25 million).
$60 million over two years under the Africa Food
Security Initiative to increase food production in
Uganda, Mali, Malawi, Mozambique, and Ethiopia. (The
FY1999 Congressional Presentation requests $21 million
in Development Assistance (DA) for these countries
under the Food Security Initiative. Notes indicate that
another $10 million is being proposed in FY1999 under
the bilateral aid requests for Malawi and Uganda, and
that ``various bilateral programs'' will fund $25
million in obligations in FY1998.)
$35 million to finance 100% reductions in
concessional debt for qualifying African states. (The
Administration had already requested these funds, which
would come from the Treasury Department's Special Debt
Relief program, in its FY1999 budget.)
$30 million for the Africa Trade and Investment
Policy (ATRIP) program. (These funds were included in
the FY1999 Congressional Presentation, which states
that ATRIP ``will help African private and public
sector partners to design and implement policy reforms
that will make their countries attractive to
international trade and investment.'')
$30 million to help strengthen judicial systems in
the Great Lakes-region of Africa. (Secretary of State
Albright had first proposed the Great Lakes Justice
Initiative (GLJI), as a means of promoting regional
reconciliation, during her December 1997 Africa visit.
$25 million is requested under the Economic Support
Fund in the Administration's FY1999 Congressional
presentation.)
committee oversight findings
In compliance with clause 2(l)(3)(A) of rule XI of the
Rules of the House of Representatives, the Committee reports
the findings and recommendations of the Committee, based on
oversight activities under clause 2(b)(1) of rule X of the
Rules of the House of Representatives, are incorporated in the
descriptive portions of this report.
committee on government reform and oversight findings
No findings or recommendations of the Committee on
Government Reform and Oversight were received as referred to in
clause 2(l)(3)(D) of rule XI of the Rules of the House of
Representatives.
advisory committee statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
applicability to the legislative branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
constitutional authority statement
In compliance with clause 2(l)(4) of rule XI of the Rules
of the House of Representatives, the Committee cites the
following specific powers granted to the Congress in the
Constitution as authority for enactment of H.R. 4283 as
reported by the Committee: Article I, section 8, clause 1
(relating to providing for the common defense and general
welfare of the United States); Article I, section 8, clause 3
(relating to the regulation of commerce with foreign nations);
and Article I, section 8, clause 18 (relating to making all
laws necessary and proper for carrying into execution powers
vested by the Constitution in the government of the United
States).
new budget authority and tax expenditures, congressional budget office
cost estimate, and federal mandates statements
The Committee adopts the cost estimate of the Congressional
Budget Office as its submission of any new required information
on new budget authority, new spending authority, new credit
authority, or an increase or decrease in the national debt,
which is set out below. It adopts the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act, also set out below.
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 27, 1998.
Hon. Benjamin A. Gilman,
Chairman, Committee on International Relations, U.S. House of
Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 4283, the Africa:
Seeds of Hope Act of 1998.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Craig
Jagger and Joe Whitehill.
Sincerely,
James L. Blum
(For June E. O'Neill, Director).
Congressional Budget Office Cost Estimate
H.R. 4283--Africa: Seeds of Hope Act of 1998
Summary.--H.R. 4283 would provide direction to the Agency
for International Development (AID), the Overseas Private
Investment Corporation, and the U.S. Department of Agriculture
(USDA) regarding the operation of programs encouraging
agriculture and rural development in sub-Saharan Africa. The
bill would emphasize assistance to women, small farmers, and
small rural entrepreneurs. It would require AID and USDA to
develop a plan that would coordinate research and extension
activities of U.S. land-grant universities, international
agricultural research centers, and national agricultural
research and extension centers in sub-Saharan Africa. It also
would provide guidance to AID on the administration of
nonemergency food assistance programs. Because the bill would
not substantially expand the Administration's authority to
provide assistance, CBO estimates that spending targeted at
Africa would continue under the bill at the current rate--
approximately $1 billion per year in economic assistance,
security assistance, and food aid. That spending would be
subject to appropriation.
H.R. 4283 would affect direct spending through its impact
on the Food Security Commodity Reserve (FSCR). As a result,
pay-as-you-go procedures would apply to the bill. The FSCR
consists of grain stocks that can be released to continue food-
aid shipments (under a program known as P.L. 480) when U.S.
supplies would otherwise be too tight to continue shipments or
when recipient countries have unanticipated needs. Under H.R.
4283, beginning in fiscal year 2000, USDA could use funds that
it receives as reimbursement for the value of grain released
from the FSCR to purchase grain to restock the FSCR. That
authority does not exist under current law. CBO estimates that
enacting H.R. 4283 would increase spending by $76 million over
the fiscal years 1999 through 2003 and by $344 million over the
fiscal years 1999 through 2008.
The bill contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would not affect the budgets of state, local, or tribal
governments.
Estimated cost to the Federal Government.--The estimated
budgetary impact of H.R. 4283 is shown in the following table.
The costs of this legislation fall within budget function 350
(agriculture).
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars
--------------------------------------------
1999 2000 2001 2002 2003
----------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING
Estimated Budget Authority......................................... 0 17 18 20 21
Estimated Outlays.................................................. 0 17 18 20 21
----------------------------------------------------------------------------------------------------------------
Basis of estimate.--H.R. 4283 would change several aspects
of the Food Security Commodity Reserve and would rename it the
Bill Emerson Humanitarian Trust (the Trust). The FSCR currently
consists of grain stocks (currently all wheat) owned by the
Commodity Credit Corporation (CCC)--a corporation within USDA.
The government can release these FSCR stocks to continue grain
shipments under the P.L. 480 food-aid program when U.S.
supplies would otherwise be too tight to continue shipments or
when recipient countries have unanticipated needs. When grain
stocks are released from the FSCR, CCC must be reimbursed with
appropriated food-aid funds for the costs of the grain
released. Under current law, FSCR grain stocks cannot be
replaced unless other CCC grain stocks are available or
purchases from the market are authorized in an appropriate
action.
Under H.R. 4283, beginning in fiscal year 2000, USDA would
be allowed to keep and to use funds from P.L. 480
reimbursements to purchase grain to replace supplies released
from the Trust. These purchases would be limited to no more
than $20 million per year for fiscal years 2000 through 2003.
(This limit would not restrict FSCR storage and other operating
costs.) P.L. 480 reimbursements that were not used during a
year would remain available for purchases in future years. H.R.
4283 would also authorize CCC to hold money--not just grain--in
the Trust. Beginning in fiscal year 2004, purchases would not
be restricted and accumulated funds from previous years could
be spent.
Not only would USDA incur new purchase costs but storage
costs would be higher as more grain would be in the Trust. Per-
bushel rates for P.L. 480 reimbursement would vary for a number
of reasons but would likely be in the $3.50 to 3.75 range; per-
bushel storage costs would be about $0.25 per year. CBO
estimates that these changes would increase outlays from direct
spending by $76 million for fiscal years 1999 through 2003 and
$344 million for fiscal years 1999 through 2008.
Currently, the FSCR contains about 90 million bushels
(about 2.5 million metric tons) of wheat compared to the
maximum authorized level of 4 million metric tons of grain.
Wheat has been released from the FSCR six times in the 18 years
that the FSCR has been in existence. The average release per
year has been about 8.5 million bushels. CBO estimates that,
under current law, USDA would continue to release grain from
the FSCR but at somewhat less than the historical average rate
(while under H.R. 4283, we expect releases to continue at about
the historical rate).
Increases in costs for grain purchases would be limited by
the $20 million annual limit through fiscal year 2003. After
2003, cumulative P.L. 480 reimbursements that had not been used
in earlier years would be available for purchases. Therefore,
CBO estimates that purchase costs would rise substantially in
fiscal year 2004 and somewhat less in later years. Because of
expected purchases, the amount of grain in the Trust would not
change much relative to current FSCR levels but would be
substantially higher after 10 years than CBO expects under
current law.
CBO's estimated costs incorporate various adjustments to
account for USDA's ability to hold money as well as grain in
the Trust. CBO assumes that USDA would hold cash for short
periods, mainly to facilitate more efficient management of
grain stocks. Holding grain in the Trust is more supportive of
farm prices than holding cash.
Pay-as-you-go considerations.--The Balanced Budget and
Emergency Deficit Control Act sets up pay-as-you-go procedures
for legislation affecting direct spending or receipts. The net
changes in outlays that are subject to pay-as-you-go procedures
are shown in the following table. For the purposes of enforcing
pay-as-you-go procedures, only the effects in the current year,
the budget year, and the succeeding four years are counted.
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars
---------------------------------------------------------------------------------------
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
--------------------------------------------------------------------------------------------------------------------------------------------------------
Changes in outlays.............................................. 0 0 17 18 20 21 90 42 44 45 47
Changes in receipts............................................. (\1\) (\1\) (\1\) (\1\) (\1\) (\1\) (\1\) (\1\) (\1\) (\1\) (\1\)
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Not applicable.
Intergovernmental and private sector impact.--The bill
contains no intergovernmental or private sector mandates as
defined in UMRA and would not affect the budgets of state,
local, or tribal governments.
Estimate prepared by.--Craig Jagger and Joseph C.
Whitehill.
Estimate approved by.--Robert A. Sunshine, Deputy Assistant
Director for Budget Analysis.
Section-by-Section Analysis
Sec. 1. Short Title
This section provides the Act may be cited as the ``Africa:
Seeds of Hope Act of 1998.''
Sec. 2. Findings and Declaration of Policy
Subsection (a) makes the following 13 findings:
(1) The economic, security, and humanitarian
interests of the United States and the nations of sub-
Saharan Africa would be enhanced by sustainable, broad-
based public and private sector agricultural and rural
development in each of the African nations. The United
States should support such development.
(2) According to the Food and Agriculture
Organization, the number of undernourished people in
Africa has more than doubled, from approximately
100,000,000 in the late 1960s to 215,000,000 in 1998,
and is projected to increase to 265,000,000 by the year
2010. According to the Food and Agriculture
Organization, the term ``under nutrition'' means
inadequate consumption of nutrients, often adversely
affecting children's physical and mental development,
undermining their future as productive and creative
members of their communities.
(3)(A) Currently, agricultural production in Africa
employs about two-thirds of the workforce but produces
less than one-fourth of the gross domestic product in
sub-Saharan Africa, according to the World Bank Group.
(B) Africa's food imports are projected to rise from
less than 8,000,000 metric tons in 1990 to more than
25,000,000 metric tons by the year 2020.
(4) African women produce up to 80 percent of the
total food supply in Africa according to the
International Food Policy Research Institute.
(5) The most effective way to improve conditions of
the poor is to increase the productivity of the
agricultural sector. Productivity increases can be
fostered by increasing research and education in
agriculture and rural development.
(6)(A) In November 1996, the World Food Summit set a
goal of reducing hunger worldwide by 50 percent by the
year 2015 and encouraged national governments to
develop domestic food plans and to support
international aid efforts.
(B) Since then, several agencies of the United
Nations, including the International Fund for
Agricultural Development (IFAD), whose mission is to
provide the rural poor and women in the developing
world with cost-effective ways of overcoming hunger,
poverty, and malnutrition, have undertaken a
cooperative initiative on Africa.
(7) Although the World Bank Group recently has
launched a major initiative to support agricultural and
rural development, only 10 percent, or $1,200,000,000,
of its total lending to sub-Saharan Africa for fiscal
years 1993 to 1997 was devoted to agriculture.
(8)(A) The future prosperity of the United States
food processing and agricultural sector is increasingly
dependent on exports and the liberalization of global
trade.
(B) Africa represents a huge potential market for
United States food and agricultural products.
(9)(A) Increased private sector investment in African
countries and expanded trade between the United States
and Africa can greatly help African countries achieve
food self-sufficiency and graduate from dependency on
international assistance.
(B) Development assistance, technical assistance, and
training from bilateral governmental and multilateral
entities, as well as nongovernmental organizations and
land-grant universities, can facilitate and encourage
commercial development in Africa, such as improving
rural roads, agricultural research and extension, and
providing access to credit and other resources.
(10)(A) Several United States private voluntary
organizations have demonstrated success in empowering
Africans through direct business ownership and helping
African agricultural producers more efficiently and
directly market their products.
(B) Rural business associations, owned and controlled
by farmer shareholders, also greatly aid agricultural
producers to increase their household incomes.
(11)(A) Over a decade ago, the Development Fund for
Africa (DFA) was enacted into law ``to help the poor
majority of men and women in sub-Saharan Africa to
participate in a process of long-term development
through economic growth that is equitable,
participatory, environmentally sustainable, and self-
reliant.''
(B) In recent years, political change and economic
recovery in Africa have amplified the importance of
this policy objective while generating new
opportunities for its advancement.
(C) Despite these developments, funding for the
Development Fund for Africa has declined from a high of
$811,000,000 for 1993 to approximately $635,000,000 for
1997.
(12)(A) United States bilateral development and
humanitarian assistance to sub-Saharan Africa is
approximately one-tenth of 1 percent of the total
annual budget of the United States Government.
(B) Funding for agricultural development worldwide by
the United States Agency for International Development
has declined from 36 percent of its total budget in
1988 to 15 percent in 1997.
(13) The United States Agency for International
Development has initiated an Africa Food Security
Initiative in an effort to improve child nutrition and
increase agricultural income in Africa.
Subsection (b) contains a declaration of policy that
consistent with title XII of part I of the Foreign Assistance
Act of 1961 (relating to Famine Prevention and Freedom from
Hunger), the U.S. government should support governments of sub-
Saharan African countries, American and African nongovernmental
organizations, universities, businesses, and international
agencies, to help ensure the availability of basic nutrition
and economic opportunities for individuals in sub-Saharan
Africa, through sustainable agriculture and rural development.
title i--assistance for sub-saharan africa
Sec. 101. Africa Food Security Initiative
Subsection (a) adds new requirements carrying out the
African Food Security Initiative (AFSI). Under the Initiative,
AID plans to spend $30 million to facilitate agricultural
policy reforms, improvements in rural infrastructure, and
adoption of new technologies. AID reports the program will
focus on Ethiopia, Mali, Uganda, Malawi and Mozambique where
the governments have implemented political reforms and achieved
substantial civil stability. AID plans to expand this
initiative to Zambia, Tanzania, Guinea, Ghana, Angola, Rwanda
and Eritrea.
This subsection contains three additional requirements for
the Administrator to carry out the Initiative. Under this
subsection, the Administrator shall:
(1) emphasize programs and projects that improve the
food security of infants, young children, school-age
children, women and food-insecure households, or that
improve the agricultural productivity, incomes, and
marketing of the rural poor in Africa;
(2) solicit and take into consideration the views and
needs of intended beneficiaries and program
participants during the selection, planning,
implementation, and evaluation phases of projects; and
(3) ensure that programs are designed and conducted
in cooperation with African and United States
organizations and institutions, such as private and
voluntary organizations, cooperatives, land-grant and
other appropriate universities, and local producer-
owned cooperative marketing and buying associations,
that have expertise in addressing the needs of the
poor, small-scale farmers, entrepreneurs, and rural
workers, including women.
Subsection (b) contains a sense of Congress that if there
is an increase in funding for sub-Saharan programs, the AID
Administrator should proportionately increase resources to the
Initiative, or any comparable or successor program, for fiscal
year 2000 and subsequent fiscal years in order to meet the
needs of the countries participating in such Initiative.
Sec. 102. Microenterprise Assistance
For technical reasons, AID exceeded its $135
microenterprise funding directive in FY97, by spending $160
million on such projects. The Committee is disappointed that
only 38% of this amount was used for poverty lending programs
which provide loans under $300 targeted at the poorest people,
especially women. The picture was considerably brighter in
Africa. In FY96 AID spent roughly 20% of its budget on African
microenterprise projects. Approximately $9 million went towards
credit programs, 80% of which was devoted to poverty loans
averaging $130 each. Eighty-five percent of recipients were
women. Repayment rates for these loans averaged 96%.
Subsection (a) requires the AID Administrator, to the
extent practicable, to use credit and microcredit assistance to
improve the capacity and efficiency of agriculture production
in sub-Saharan Africa of small-scale farmers and small rural
entrepreneurs. In providing assistance, the Administrator
should take into consideration the needs of women, and should
use the applied research and technical assistance capabilities
of United States land-grant universities.
Subsection (b)(1) requires the Administrator to continue to
work with other countries, international organizations
(including multilateral development institutions), and entities
assisting microenterprises and to develop a comprehensive and
coordinated strategy for providing microenterprise assistance
for sub-Saharan Africa. Subsection (b)(2) recommends that the
Administrator encourage the World Bank Consultative Group to
Assist the Poorest to coordinate the strategy described above.
Sec. 103. Support for Producer-owned Cooperative Marketing Associations
African state-run marketing associations have been some of
the worst innovations in African agriculture. By imposing
controlled prices and wielding monopoly power over the price of
inputs, state-run associations devastated the livelihood of
African farmers across the continent. Conversely, producer-
owned associations can offer lower-priced inputs and better
marketing that actually improves productivity and pricing.
Subsection (a) outlines four purposes for this section:
(1) to support producer-owned cooperative purchasing
and marketing associations in sub-Saharan Africa;
(2) to strengthen the capacity of farmers in sub-
Saharan Africa to participate in national and
international private markets and to promote rural
development in sub-Saharan Africa;
(3) to encourage the efforts of farmers in sub-
Saharan Africa to increase their productivity and
income through improved access to farm supplies,
seasonal credit, technical expertise; and
(4) to support small businesses in sub-Saharan Africa
as they grow beyond microenterprises.
Subsection (b)(1)(A) authorizes the Administrator to
utilize relevant foreign assistance programs and initiatives
for sub-Saharan Africa to support private producer-owned
cooperative marketing associations in sub-Saharan Africa,
including rural business associations that are owned and
controlled by farmer shareholders. Subsection (B) imposes three
requirements in carrying out this subsection: that the
Administrator--
(i) shall take into account small-scale farmers,
small rural entrepreneurs, and rural workers and
communities;
(ii) shall take into account the local-level
perspectives of the rural and urban poor through close
consultation with these groups, consistent with section
496(e)(1) of the Foreign Assistance Act of 1961 (22
U.S.C. 2293(e)(1)--relating to consultations with local
private voluntary organizations); and
(iii) should take into consideration the needs of
women.
Subsection (b)(2) encourages the Administrator to:
(A) cooperate with governments of foreign countries,
including governments of political subdivisions of such
countries, their agricultural research universities,
and particularly with United States nongovernmental
organizations and United States land-grant
universities, that have demonstrated expertise in the
development and promotion of successful private
producer-owned cooperative marketing associations; and
(B) facilitate partnerships between United States and
African cooperatives and private businesses to enhance
the capacity and technical and marketing expertise of
business associations in sub-Saharan Africa.
Sec. 104. Agricultural and Rural Development Activities Of the Overseas
Private Investment Corporation
Subsection (a) sets out the purpose of this section to
encourage the Overseas Private Investment Corporation (OPIC) to
work with United States businesses and other United States
entities to invest in rural sub-Saharan Africa, particularly in
ways that will develop the capacities of small-scale farmers
and small rural entrepreneurs, including women, in sub-Saharan
Africa.
Subsection (b) contains the sense of the Congress that:
(1) OPIC should exercise its authority under law to
undertake an initiative to support private agricultural
and rural development in sub-Saharan Africa, including
issuing loans, guaranties, and insurance, to support
rural development in sub-Saharan Africa, particularly
to support intermediary organizations that--
(A) directly serve the needs of small-scale
farmers, small rural entrepreneurs, and rural
producer-owned cooperative purchasing and
marketing associations;
(B) have a clear track-record of support for
sound business management practices; and
(C) have demonstrated experience with
participatory development methods; and
(2) OPIC should utilize existing equity funds, loan
and insurance funds, to the extent feasible and in
accordance with existing contractual obligations, to
support agriculture and rural development in sub-
Saharan Africa.
Sec. 105. Agricultural Research and Extension Activities
Subsection (a) requires the AID Administrator, in
consultation with the Secretary of Agriculture and appropriate
Department of Agriculture agencies, especially the Cooperative
State, Research, Education and Extension Service (CSREES), to
develop a comprehensive plan to coordinate and build on the
research and extension activities of United States land-grant
universities, international agricultural research centers, and
national agricultural research and extension centers in sub-
Saharan Africa.
Subsection (b) adds three additional requirements that the
Plan must provide that:
(1) research and extension activities will respond to
the needs of small-scale farmers while developing the
potential and skills of researchers, extension agents,
farmers, and agribusinesspersons in sub-Saharan Africa;
(2) sustainable agricultural methods of farming will
be considered together with new technologies in
increasing agricultural productivity in sub-Saharan
Africa; and
(3) research and extension efforts will focus on
sustainable agricultural practices and will be adapted
to widely varying climates within sub-Saharan Africa.
title ii--worldwide food assistance and agricultural programs
subtitle a--nonemergency food assistance programs
Sec. 201. Nonemergency Food Assistance Programs
In late 1997, the Committee heard reports from major
humanitarian relief organizations and Cardinal John O'Connor
that AID planned to reduce funding for nonemergency food relief
programs. Such programs include U.S. food aid donations to the
Missionaries of Charity, founded by Mother Teresa. The
Committee strongly supports these programs. While the Committee
applauds AID's emphasis on providing food aid to projects
designed to end food aid dependency, the Committee also
believes that some food aid to chronically dependent
communities of sick, elderly and handicapped persons should
continue. On June 22, 1998, the Committee received a letter
from the AID Administrator promising to ``at least double the
dollar value of these activities to more than $30 million in FY
1999.'' The Committee applauds this commitment. Should this
commitment be implemented, the Committee will entertain
proposals to modify the language of Subtitle A.
Subsection (a) sets forth three requirements for the AID
Administrator to implement nonemergency assistance under title
II of the Agricultural Trade Development and Assistance Act of
1954 (7 U.S.C. 1721 et seq.). These provisions require that the
Administrator shall ensure that:
(1) in planning, decision making, and implementation
in providing such assistance, the Administrator takes
into consideration local input and participation
directly and through United States and indigenous
private and voluntary organizations;
(2) each of the nonemergency activities described in
paragraphs (2) through (6) of section 201 of such Act
(7 U.S.C. 1721) (relating to the purposes of emergency
and private assistance programs), including programs
that provide assistance to people of any age group who
are otherwise unable to meet their basic food needs
(including feeding programs for the disabled, orphaned,
elderly, sick and dying), are carried out; and
(3) greater flexibility is provided for program and
evaluation plans so that such assistance may be
developed to meet local needs, as provided for in
section 202(f) of such Act (7 U.S.C. 1722(f)--relating
to the effective use of commodities).
Subsection (b) requires that in providing assistance under
the Agriculture Trade Development and Assistance Act of 1954,
the Secretary of Agriculture and the AID Administrator shall
ensure that commodities are provided in a manner that is
consistent with sections 403 (a) and (b) of such Act (7 U.S.C.
1733 (a) and (b)--regarding adequate storage, no disruption of
local production, and consultations with the World Bank).
subtitle b--bill emerson humanitarian international food security trust
act of 1998
Sec. 211. Short Title
This section provides that this subtitle may be cited as
the `Bill Emerson Humanitarian International Food Security
Trust Act of 1998'.
Sec. 212. Bill Emerson Humanitarian Trust Act
Subsection (a) amends Section 302 of the Food Security
Commodity Reserve Act of 1996 (7 U.S.C. 1736f-1) to permit the
Bill Emerson Humanitarian International Food Security Trust to
hold funds as well as commodities. The Reserve was established
by the Agricultural Act of 1980 (P.L. 96-494) which included
the text of H.R. 6635, the Food Security Act of 1980, which
Chairman Gilman was an original cosponsor. The current Food
Security Commodity Reserve holds approximately 2.5 million
metric tons of wheat (90 million bushels) and is limited to a
total of four million metric tons. Commodities in the trust can
be released when domestic supplies are tight or to meet
unanticipated humanitarian needs in developing countries. Wheat
from this reserve has been released six times since the Reserve
was created in 1980. Changes made by this Act would allow the
Reserve to continue providing commodities (or funds) at its
current rate.
In addition to changing the name of the Reserve to the
Trust, the Act allows the Trust to hold funds. Spending funds,
instead of commodities from the Trust, would allow the United
States to more rapidly and effectively respond to food
emergencies around the world. Allowing the trust to hold funds
also reduces costs by eliminating storage and administration
expenses (current costs total 25 cents per bushel of wheat to
store for one year). It is the Committee's understanding that
funds held by the Trust are to be used to purchase commodities
for the stated purposes of the Trust.
When the Africa: Seeds of Hope Act was initially introduced
as H.R. 3636, the bill provided that funding used under current
law to reimburse the CCC would be used instead to replenish the
Trust. The Congressional Budget Office (CBO) advised the
Committee that this would entail a scoring of several hundred
million dollars. This bill limited the total amounts provided
to the Trust to limit this score. Subsection (B) specifically
limits funding for the replenishment of the Trust to a total of
$80 million, divided equally between FY 2000-2003. The
Committee understands that the initial CBO scoring of this
provision totals $76 million through 2003 and $344 million
through 2008.
It is the Committee's intent that the Secretary manage the
resources of the Trust in a prudent manner to enable the U.S.
to respond to humanitarian crises. Therefore, the Committee
provided this subsection, which requires that the Secretary of
Agriculture may release eligible commodities under subparagraph
(A) only to the extent such release is consistent with
maintaining the long-term value of the trust.
Subsection (b) makes conforming amendments to rename and
conform the Act to accommodate the Bill Emerson Humanitarian
Trust.
title iii--miscellaneous provisions
Sec. 301. Report
This section requires that not later than 6 months after
the date of enactment of this Act, the AID Administrator, in
consultation with the heads of other appropriate agencies,
shall prepare and submit to Congress a report on how the Agency
plans to implement sections 101, 102, 103, 105, and 201 of this
Act, the steps that have been taken toward such implementation,
and an estimate of all amounts expended or to be expended on
related activities during the current and previous 4 fiscal
years.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3 of rule XIII of the Rules of the
House of Representatives, changes in existing law made by the
bill, as reported, are shown as follows (existing law proposed
to be omitted is enclosed in black brackets, new matter is
printed in italic, existing law in which no change is proposed
is shown in roman):
AGRICULTURAL ACT OF 1980
* * * * * * *
[TITLE III--FOOD SECURITY COMMODITY RESERVE
[SEC. 301. SHORT TITLE.
[This title may be cited as the ``Food Security Commodity
Reserve Act of 1996''.]
TITLE III--BILL EMERSON HUMANITARIAN TRUST
SEC. 301. SHORT TITLE.
This title may be cited as the ``Bill Emerson Humanitarian
Trust Act''.
SEC. 302. ESTABLISHMENT OF COMMODITY [RESERVE] TRUST.
(a) In General.--To provide for a [reserve] trust solely to
meet emergency humanitarian food needs in developing countries,
the Secretary of Agriculture (referred to in this title as the
``Secretary'') shall establish a [reserve] trust stock of
wheat, rice, corn, or sorghum, or any combination of the
commodities, totaling not more than 4,000,000 metric tons for
use as described in subsection (c).
(b) Commodities or Funds in [Reserve] Trust.--
(1) In general.--The [reserve] trust established
under this section shall consist of--
(A) wheat in the reserve established under
the Food Security Wheat Reserve Act of 1980 as
of the date of enactment of the Federal
Agriculture Improvement and Reform Act of 1996;
(B) wheat, rice, corn, and sorghum (referred
to in this section as ``eligible commodities'')
acquired in accordance with paragraph (2) to
replenish eligible commodities released from
the [reserve,] trust, including wheat to
replenish wheat released from the reserve
established under the Food Security Wheat
Reserve Act of 1980 but not replenished as of
the date of enactment of the Federal
Agriculture Improvement and Reform Act of 1996;
[and]
(C) such rice, corn, and sorghum as the
Secretary may, at such time and in such manner
as the Secretary determines appropriate,
acquire as a result of exchanging an equivalent
value of wheat in the [reserve] trust
established under this section[.]; and
(D) funds made available under paragraph
(2)(B).
(2) Replenishment of [reserve] trust.--
(A) In general.--[Subject to subsection (h),
commodities] Commodities of equivalent value to
eligible commodities in the [reserve] trust
established under this section may be
acquired--
(i) through purchases--
(I) from producers; or
(II) in the market, if the
Secretary determines that the
purchases will not unduly
disrupt the market; or
(ii) by designation by the Secretary
of stocks of eligible commodities of
the Commodity Credit Corporation.
[(B) Funds.--Any use of funds to acquire
eligible commodities through purchases from
producers or in the market to replenish the
reserve must be authorized in an appropriations
Act.]
(B) Funds.--Any funds used to acquire
eligible commodities through purchases from
producers or in the market to replenish the
trust shall be derived--
(i) with respect to fiscal year 2000
and subsequent fiscal years, from funds
made available to carry out the
Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1691
et seq.) that are used to repay or
reimburse the Commodity Credit
Corporation for the release of eligible
commodities under subsections (c)(2)
and (f)(2), except that, of such funds,
not more than $20,000,000 may be
expended for this purpose in each of
the fiscal years 2000 through 2003 and
any such funds not expended for the
fiscal year allocated shall be
available for expenditure in subsequent
fiscal years; and
(ii) from funds authorized for that
use by an appropriations Act.
(c) Release of Eligible Commodities.--
(1) Emergency assistance.--
(A) * * *
(B) Release for emergency assistance.--If the
eligible commodities needed to meet
unanticipated need cannot be made available in
a timely manner under normal means for
obtaining eligible commodities for food
assistance because of unanticipated need for
emergency assistance as provided under section
202(a) of the Agricultural Trade Development
and Assistance Act of 1954 (7 U.S.C. 1722(a)),
the Secretary may in any fiscal year release
from the [reserve] trust--
(i) up to 500,000 metric tons of
wheat or the equivalent value of
eligible commodities other than wheat;
and
(ii) up to 500,000 metric tons of any
eligible commodities under this
paragraph that could have been released
but were not released in prior fiscal
years.
* * * * * * *
(2) Emergency food [assistance.--Notwithstanding]
assistance.--
(A) In general.--Notwithstanding any other
provision of law, eligible commodities
designated or acquired for the [reserve] trust
established under this section may be released
by the Secretary to provide, on a donation or
sale basis, emergency food assistance to
developing countries at such time as the
domestic supply of the eligible commodities is
so limited that quantities of the eligible
commodities cannot be made available for
disposition under the Agricultural Trade
Development and Assistance Act of 1954 (7
U.S.C. 1691 et seq.) (other than disposition
for urgent humanitarian purposes under section
401 of the Act (7 U.S.C. 1731)).
(B) Limitation.--The Secretary may release
eligible commodities under subparagraph (A)
only to the extent such release is consistent
with maintaining the long-term value of the
trust.
(3) Processing of eligible commodities.--Eligible
commodities that are released from the [reserve] trust
established under this section may be processed in the
United States and shipped to a developing country when
conditions in the recipient country require processing.
* * * * * * *
(d) Management of Eligible Commodities.--The Secretary shall
provide--
(1) for the management of eligible commodities in the
[reserve] trust established under this section as to
location and quality of eligible commodities needed to
meet emergency situations; [and]
(2) for the periodic rotation or replacement of
stocks of eligible commodities in the [reserve] trust
to avoid spoilage and deterioration of the
commodities[.]; and
(3) subject to the need for release of commodities
from the trust under subsection (c)(1), for the
management of the trust to preserve the value of the
trust through acquisitions under subsection (b)(2).
(e) Treatment of [Reserve] Trust Under Other Law.--Eligible
commodities in the [reserve] trust established under this
section shall not be--
(1) considered a part of the total domestic supply
(including carryover) for the purpose of subsection (c)
or for the purpose of administering the Agricultural
Trade Development and Assistance Act of 1954 (7 U.S.C.
1691 et seq.); and
(2) subject to any quantitative limitation on exports
that may be imposed under section 7 of the Export
Administration Act of 1979 (50 U.S.C. App. 2406).
(f) Use of Commodity Credit Corporation.--
(1) * * *
(2) Reimbursement of the trust.--
(A) In general.--The Commodity Credit
Corporation shall be reimbursed for the release
of eligible commodities from funds made
available to carry out the Agricultural Trade
Development and Assistance Act of 1954 (7
U.S.C. 1691 et seq.) and the funds shall be
available to replenish the trust under
subsection (b).
(B) Basis for reimbursement.--The
reimbursement shall be made on the basis of the
lesser of--
(i) the actual costs incurred by the
Commodity Credit Corporation with
respect to the eligible commodity; or
(ii) the export market price of the
eligible commodity (as determined by
the Secretary) as of the time the
eligible commodity is released from the
[reserve] trust.
(C) Source of funds.--The reimbursement may
be made from funds appropriated for subsequent
fiscal years.
(g) Finality of Determination.--Any determination by the
Secretary under this section shall be final.
[(h) Termination of Authority.--
[(1) In general.--The authority to replenish stocks
of eligible commodities to maintain the reserve
established under this section shall terminate on
September 30, 2002.
[(2) Disposal of eligible commodities.--Eligible
commodities remaining in the reserve after September
30, 2002, shall be disposed of by release for use in
providing for emergency humanitarian food needs in
developing countries as provided in this section.]
* * * * * * *
----------
SECTION 208 OF THE AGRICULTURAL TRADE SUSPENSION ADJUSTMENT ACT OF 1980
trade suspension reserves
Sec. 208. Notwithstanding any other provision of law--
(a) * * *
* * * * * * *
(d)(1) * * *
(2) Applicability of certain provisions.--Subsections (c),
(d), (e), and (f)(2) of section 302 of the [Food Security
Commodity Reserve Act of 1996] Bill Emerson Humanitarian Trust
Act (7 U.S.C. 1736f-1 et seq.) shall apply to commodities in
any reserve established under paragraph (1), except that the
references to ``eligible commodities'' in the subsections shall
be deemed to be references to ``agricultural commodities''.
* * * * * * *
----------
SECTION 901b OF THE MERCHANT MARINE ACT, 1936
SHIPMENT REQUIREMENTS FOR CERTAIN EXPORTS SPONSORED BY THE DEPARTMENT
OF AGRICULTURE
Sec. 901b. (a) * * *
(b) This section shall apply to any export activity of the
Commodity Credit Corporation or the Secretary of Agriculture--
(1) * * *
* * * * * * *
(3) carried out under the [Food Security Wheat
Reserve Act of 1980 (7 U.S.C. 1736f-1)] Bill Emerson
Humanitarian Trust Act (7 U.S.C. 1736f-1 et seq.);
* * * * * * *