MADRID, SPAIN - The Asian Development Bank will provide immediate budgetary support to the hardest hit countries in Asia and the Pacific to alleviate their fiscal burdens and cushion the impact of rising food prices on the poor and vulnerable, says ADB President Haruhiko Kuroda.

Mr. Kuroda told a news briefing on the eve of the 41st Annual Meeting of ADB that rising food and fuel prices have placed many governments in the region under significant pressure to put food on the tables of the poor and vulnerable.

Over a billion people in the region are seriously impacted by the food price surge as food expenditure accounts for 60% of total expenditure basket. Food and energy together account for more than 75% of total spending of the poor in the region.

Rising food prices threaten to undermine the region's efforts to fight against poverty and achieve the Millennium Development Goals by 2015.

Many governments have provided generous subsidies, imposed price controls, and banned exports to keep food grain prices in check.

"We believe targeted interventions to protect food entitlements of the most vulnerable and poor are more effective to mitigate the immediate impact of rising food prices," says Mr. Kuroda.

ADB has outlined the nature of the food price crisis, its underlying causes, expected impacts and possible responses in a paper titled "Soaring Food Prices: Some Possible Responses."

Mr. Kuroda says, in the short run, ADB will closely work with the affected governments in the region to strengthen safety net programs for food-stressed populations and emergency food security reserves systems.

ADB is also supporting the International Rice Research Institute (IRRI) and the International Food Policy Research Institute (IFPRI) to boost research and provision of inputs to farmers to help overcome key constraints.

In the medium to long run, governments need to step up investment, boost rural infrastructures and strengthen institutions to sustain higher farm output.

"We are working closely with our development partners to respond to the crisis in line with our comparative advantages and resource availability," says Mr. Kuroda.

ADB said, in the long term, its assistance to the agriculture and natural resource sector would seek to

* enhance productivity growth,
* promote biosecurity,
* improve market access and income diversification,
* improve access to information and communication technology
* continue dialogue to deepen and widen policy reform
* strengthen institutions, enhance capacity and skills.