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Commission Statement at High Level Segment of ECOSOC

Mr President,

1. Please let me add some remarks to the statement of the Presidency of European Union, with which I allign myself.

The importance of rural development

2. Poverty reduction is the central objective of the EC development policy. As we all know, poverty is predominantly rural, and likely to remain so for the foreseeable future. Hence, rural development and food security are essential in the fight against poverty and, as such, are high on the agenda of the European Commission and the EC development policy. How do we translate this priority into practice?

3. Rural development goes beyond its social and economic dimensions: It is also a necessary condition to foster more peaceful, equitable and open societies based on greater transparency, accountability and decentralisation, which are vital to prevent conflicts, the greatest threats to national development. Coherent support to rural development also helps to address some of the root causes of conflict in developing countries, including the inequitable access to natural resources.

4. National development strategies or national poverty reduction strategies (PRSPs), indicate a growing commitment by Governments to poverty reduction. However, despite their importance for poverty reduction, rural areas tended to be neglected in the development strategies of both governments and donors in the last years. Perhaps this was due to not so very successful experiences in the past decades. Rural problems are so complex that many actors shied away from it.

Changing Approaches to Rural Development

Mr. President,

5. We strongly believe that it is necessary to address rural development more systematically and in a comprehensive manner for poverty reduction, food security and sustainable environmental management. It calls for different approaches from donors and developing countries.

6. To tackle poverty in rural areas requires support on the one hand local institutions, so as to improve their responsiveness and interaction with local communities, and on the other hand the wide range of sectors that impact heavily on the rural economy. In this respect, the agricultural sector is a particular priority because (i) it contributes substantially to national income, exports, employment, investment and savings, (ii) it forms the basis of the livelihoods of the majority of the rural poor, and (iii) it stimulates the growth of the non-farm sector.

7. When talking about agriculture, I would like to turn the attention to the role of improved market access for developing countries' agricultural products and less trade-distortive agricultural subsidies in providing real opportunities for agricultural development. As to market access the EU already has the lowest tariff scheme for developing countries - through its Everything But Arms initiative, which provides quota and duty free access for LDCs; the Cotonou Agreement as well as our GSP scheme. More efforts were needed on agricultural subsidies. The agreement reached by EU ministers on the 26th of June on a comprehensive and far reaching reform package for the Common Agricultural Policy represents, in this respect, a fundamental leap forward.

8. This reform will completely change the shape of EU support to its agriculture. The reform is centred on decoupling farm subsidies from production through a single income payment to farmers, which will be linked to environmental and food safety standards and animal welfare standards and a stronger accent on rural development. It will result in the substantial reduction in trade distorting subsidies on our side. It is now up to countries whose agricultural policies continue to be highly trade distorting to follow suit. Furthermore, the Commission will propose additional reform in the autumn for crops that are of particular relevance to developing countries, such as cotton, not covered by this package. We believe that these reforms of the CAP provide the ground for achieving fundamental improvements in agricultural trade opportunities in the forthcoming Doha negotiations, provided that other industrial countries can come up with similar concessions.

Mr. President,

9. Let me return to the national policies where, as I said, rural development is more than agriculture alone and requires co-ordinated and coherent action in several sectors. Approaches to rural development must also recognise that rural and urban spaces are becoming increasingly linked. With development, there tends to be a transition from subsistence agriculture to more diversified and commercial activities linked into urban markets. This is characterised by growth of non-farm employment, development of secondary towns and peri-urban farming, migration to high-potential rural areas and to urban areas, which can lead to the development of broader, more competitive and better-integrated markets and increase economic opportunities for resource-poor farmers.

10. Therefore, the European Commission now supports a mainstreamed approach to rural development incorporating the objectives of rural poverty reduction, food security and sustainable natural resource management within the existing framework of policies, institutions and programmes. This builds on principles of participation, empowerment and ownership of development strategies by the rural poor, which to be successful require effective political and administrative decentralisation.

11. Rural areas play a central role for economic and social development, and we therefore welcome the focus of ECOSOC on rural development. It can play a crucial role in drawing further attention to rural concerns and by identifying and recommending appropriate action for narrowing the gap between urban and rural populations, building on the renewed impetus of development cooperation in the wake of Monterrey, Doha and Johannesburg.

12. ECOSOC should focus on themes where it can bring added value. From a development perspective, I am of course particularly interested in elements that have a clear link to and support the eight MDGs and the overarching goal of poverty eradication. Progress towards the MDGs should be systematically monitored; also as a safeguard against the tendency to confuse success in political processes with real progress.

13. Regarding the means of implementation, we are equipped with an extensive toolbox and we must use the most appropriate tools and approaches, including, of course, PRSPs and SWAPs, but also stakeholder dialogues, participatory planning and budgeting, and other innovative ways to promote rural development.

14. We all worked very hard to reach the Monterrey consensus, and we should now work equally hard with its implementation. The European Commission's Communication on Fighting Rural Poverty, issued last year in September, provides a strong basis for a strategic framework for the rural space, focused on achieving the eight MDGs. We should, however; remain realists and recognise that we still face major obstacles especially in some Least Developed Countries, where violent conflicts, the absence of basic infrastructure, and the lack of Good Governance seriously hamper development and growth. Similarly, in many countries, local institutions are not yet adequately equipped to accompany the development of the rural space. Institutional capacity building must be a top priority in these countries. Without such appropriate administrative infrastructure, even the sizeable amount of additional ODA that the European Union has pledged - and we are talking of roughly eight billion Euro per year - may not result in more efficient and coherent strategies and programmes for rural development.

Thank you, Mr. President.

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