HL Deb 21 May 1992 vol 537 cc45-6WA
Lord Judd

asked Her Majesty's Government:

What action they are taking to persuade the International Monetary Fund and the World Bank to modify their structural adjustment programmes for southern Africa and for the Horn of Africa to enable the reduction of food prices and subsidies on agricultural imports.

Baroness Chalker of Wallasey

The Government will continue to encourage the international financial institutions to look at the circumstances of individual countries when agreeing appropriate targets under adjustment programmes, which will strengthen the countries' capacity to ensure that enough food is available. The Government believe the international financial institutions are sensitive to the need to protect the populations of countries in eastern and southern Africa from the worst effects of the current drought. For example, in Zambia and Zimbabwe the schedule for reducing food subsidies has been modified to recognise that subsidies will need to increase while drought conditions prevail. Populations in need of emergency support are receiving free distribution of food, and plans are being prepared for free distribution of seeds and tools.

In his speech to the IMF/IBRD Development Committee, my right honourable friend the Chancellor welcomed the suggestion made by the managing director of the IMF that, for affected countries with ESAF programmes, the impact of the drought should be taken into account in reviewing levels of access to IMF funding.

Macro-economic targets are being re-phased to accommodate essential drought-related expenditures, although it is hoped that the increased donor effort, of which the recently announced UK contribution of £30 million is a significant part, will finance a large part of the additional cost. When normal conditions return, the Government consider that it will be important to continue to implement economic reform programmes with full vigour, including progress towards eliminating general subsidies while encouraging the use of carefully targeted measures to protect the poor.