The U.N. May Cut Back On Food Aid To Tackle A Budget Crisis

Rome, Italy (AHN) - The clock is ticking for the United Nations amid its ongoing appeal for financial help from potential donor countries to bridge what experts claim to be a $650 million gap in the organization's budget. If the U.N. fails to receive additional funding by May 1, plans for cutting costs include drastic measures such as cutting back on food rations to some of the world's poorest countries.

In an appeal letter to donors dated March 20, Word Food Program (WFP) Executive Director Josette Sheeran said food prices have jumped 55 percent since June 2007, adding "such increases show no sign of abating any time soon." Furthermore, the cost of fuel and other transportation expenses has also been on the rise. Oil supplies have been hurt by increased demand by developing countries, natural calamities and the possible impact of climate change.

In a conference call on Monday, Sheeran said that the agency had not encountered a situation in the past "where aggressive rises in food prices keep pricing operations out of our reach... People around the world are being "priced out of the food market."

Sheeran said that if additional funding would not come on time, the agency will be forced to cut food support "for those who rely on the world to stand by them during times of abject need."

Realizing the global impact and severe repercussions of the problem, Sheeran urged governments to make immediate actions to address rising commodity costs.

With an annual budget of $2.9 billion last year for its operations, the WFP provided food for at least 73 million hungry people in 80 nations. With soaring food and operational costs however, the agency's operational budget for 2008 is now estimated at about $3.4 billion.