The effects of war, economic sanctions and three years of severe drought, from 1999 to 2001, have seriously eroded the livelihood base of Iraqis, the Food and Agriculture Organization (FAO) and the World Food Programme (WFP) said in their food supply and nutrition assessment mission report. This year’s cereal production in Iraq is forecast at 4.12 million tons, 22 per cent higher than estimated last year. Production increased mainly due to favourable rains in the northern part of the country, increased irrigation and timely distribution of agricultural inputs in the main producing areas. While starvation has been averted, chronic malnutrition persists among several million vulnerable people, including some 100,000 refugees and around 200,000 internally displaced people. The situation of mothers and children in central and southern Iraq is of particular concern. In the northern parts, acute malnutrition has been virtually eliminated. About 60 per cent of the Iraqi population is unemployed and depend largely on public food rations. Millions have no access to food other than through public food assistance, which is financed through the UN’s Oil-for-Food-programme. “Any significant disruption of the public distribution system would have a severe negative impact on food access,” the report warns, recognizing the need to continue the public food distribution system and relief food aid activities for the short- to medium-term because the agriculture sector will need considerable time for rehabilitation. “However, the highly subsidized food basket policy must be rethought and better targeted; it should eventually be gradually phased out,” it adds.