uma lele, manmohan agarwal sambuddha goswami "global agricultural development: changing aid...

U M A L E L E , M A N M O H A N A G A RWA L S A M B U D D H A G O S WA M I

" G L O B A L A G R I C U LT U R A L D E V E L O P M E N T: C H A N G I N G A I D A R C H I T E C T U R E , N E W P L AY E R S,

A N D T H E E VO LV I N G R O L E S O F T R A D I T I O N A L D O N O R S “

A M E R I C A N A P P L I E D E C O N O M I C S A SS O C I AT I O N, P I TT S B U R G H , PA , J U LY 2 6 , 2 0 1 1 .

Towards a More Effective Global Architecture for Food and

Agriculture

Lele, Agarwal, Goswami, AAEA 2011

Food Price Rise or Volatility?

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

50

100

150

200

250

FAO Real Food Price Index(Annual)

(1990-2011)

Food Price Index

Source: www.fao.org/worldfoodsituation/wfs-home/foodpricesindex/en/-

2002-2

004=

100

?


G 20 Declaration of Ministers of Agriculture on Food and Agricultural Markets & Price Volatility, June 21-22, 2011

Policy Options Paper By Core International Organizations Although some think the G 20 Declaration as a low hanging fruit A Potential Opportunity to get A Dysfunctional International

Architecture working together ar0und short and long term issues of global food and agriculture

Dizzying # of Uncoordinated Initiatives L’ Aquila Food Security Initiative, Global Partnership for Agriculture, Food Security and Nutrition, Five Rome principles for Sustainable Food Security @ World Summit on Food

Security in November 2009, Reform of the Committee on Food Security to name only a few mentioned in the

statement US’s Feed the Future

Reform of the Committee on Food Security Election of FAO DG– Contrast to IMF FAO’s New DG after two 18 year terms


Differences in Governance Among International Organizations: Lack of Priorities, Overlapping

Mandates

UN Institutions inherently different organizations than multilateral Banks—

FAO a Specialized UN Agency—Like WHO-- Based on one country one vote—

WB, IMF, IFAD, WFP— Where donors have more powervote weighted according to contributions---

Differences among developed and developing countries on substantive issues

personality politics in leadership

Collective Action challenges

Efficiency vs. Legitimacy They Need Each Other Can they come together with a vision for the G 20 Meeting in

November?


Core International Organizations Concerned with Food and Agriculture

UNHLTF/FAO+13 More

IOs

World Bank and IMF

IFAD

WFP

WTO

UNCTAD

CGIAR


From Fragmented and Chaotic To A Virtuous Architecture

Country Owned

Strategies

Capacity Building

Planning and

Implementation

Monitoring and

Accountability to

Poor

Learning Lessons

200 Donors Contributing Trust Funds to WB 1075 Trust Funds 10 Large Funds Trust Funds Managed by WB > than IDA High Transaction Costs to Developing Countries

of Lack of Harmonization Strategic Global Allocation of ODA+ Foundation

Flows?: GPGs, RPGs, Country Assistance?

Many Stakeholders

Private

Foundatio

ns

Private

Foundatio

ns

Civil Society

Private Investors

Developing Countries

China

India

Think

Tanks

UNICEF

Research Institution

s

Food

Industry


On Demand Side On the Supply Side

Population Growth: All in LDCs

Income Growth: Mostly in LDCs

Urbanization: Up from 50% to 70%

Shift in Food Preferences: Rice, Wheat, Maize,

Soybeans for Feed:Biofuels: maize, oilseedsProcessed Foods

Climate ChangeLimits to Land, Water,

Soils, Biodiversity, Forests, Fisheries

Increased Risks and Uncertainty

Investment in R and DLast Frontiers?

Brazil, SSA?

Overarching Challenge

9 Billion + in 2050: Cereal Production (Net of Biofuels) Increase by 70%, Meat production 220%, Cereal Imports of Developing countries by 220%


Middle Income Countries

Low Income Countries

Large Share of Global Poverty in Middle Income countries where aid is unimportant

Importance of Knowledge Transfers?

Special Challenges of less developed countries Diseconomies of scale Limited capacity Early stage of

demographic transition

Implications of Differentiation Among Developing Countries


Already Declining Share of ODA Compounded by OECD Economic Woes


Decapitalization of Agriculture with Declining ODA to Agriculture (1979 – 2007)+ Government Neglect


Trends in world hunger Undernourishment in 2010, by Region (Millions)

Largest Number of the world’s hungry in South Asia

1990-1992

1995-1997

2000-2002

2005-2007

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0 Number of Undernourished Person

(Millions)Northern Africa

Sub-Saharan Africa

Latin America and the Caribbean

Eastern Asia

Eastern Asia (without China)

South Asia

South Asia (without India)

South-Eastern Asia

Western Asia

Developed regionsSource: FAO STATISTICS DIVISION


Source: PovcalNet, the World Bank; and GMR 2010.

Poverty Rates Declining Without Decline in Number of Hungry?

Share of Population Living on Less Than $ 1.25 a Day, % (2005)


Under Five Malnourishment

East A

sia

and

Paci

fic

Europ

e C

entral

Asi

a

Latin

Am

eric

a &

Car

ibbe

an

Mid

dle

East a

nd N

orth

Afric

a

South

Asi

a

Sub-S

ahar

an A

fric

a

0

10

20

30

40

50

Child malnutrition rates remain high in South Asia and Sub-Saharan Africa

2000 2009

Source: United Nations Children's Fund, World Heath Organization and WDI, World Bank

Pro

port

ion o

f chil

dre

n u

nder

age 5

underw

eig

ht

for

age (

%)


Agricultural TFP Growth: SA and SSA Lagging in TFP Growth

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

0

50

100

150

200

250Agricultural TFP Index Growths, by Region

(1961-2007)

SUB-SAHARAN AFRICA (EXCLUDING SOUTH AFRICA) LAC

NORTH AMERICA SOUTH-EAST ASIA

SOUTH ASIA ASIA (EXCLUDING MIDDLE EAST)

EUROPE (EXCLUDING USSR) MENA

OCEANIA DEVELOPING COUNTRIES

Base

Year

1961=

100


CGIAR Reforms: Work in Progress

Fund Council Centers’ Consortium SRF Proposes Tripling of CGIAR Funding by 2020 CRPs Approved or in Process of being Approved Centers Coming Together 300 to 900 stated partners in Some CRPs Design of Partnerships: their Costs and Benefits Independent M and E of CRPs Work in Progress Complementary Funding Needed for NARS of $14 Billion to

Achieve Stated SRF objectives of Hunger and Poverty Reduction

Funding not yet forthcoming nor any explicit strategy for NARS funding

Contrast to the Green Revolution Period


CGIAR Funding Grows but Remains Restricted

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

0

100

200

300

400

500

600

700

800

Nominal; 673

20

1972 dollars; 115

Figure 2. CGIAR Total Funding Trends

Nominal and in 1972 dollars

US

$ m

illio

n

2010

0%

20%

40%

60%

80%

100%

Unrestricted

Restricted

Figure 4. Composition of CGIAR Funding


South Now Important PlayersChina Spending= Brazil + India/ Each =SSA

Source: ASTI as reported in Beintema and Stads (2011)


2006 2007 2008 2009 20100

1000

2000

3000

4000

5000

6000

7000

8000

CGIAR Total Staffing(2006-2010)

Total (International) Total (Others)

Developing Country Scientist Numbers

China 80,000

India (2003) 16,700

SSA (2008) 12,100

Brazil (2006) 5,400

Sources AST and: Chen, K. Z., and Y. Zhang. 2010. Agricultural R&D as an

engine of productivity growth: The case of China. Report prepared for UK

Government’s Foresight Food and Farming Futures project

More South South As well as North South Cooperation Needed


FROM FOOD AID TO FOOD ASSISTANCE?EVOLUTION OF WFP STRATEGY IN RECENT

YEARS

FOOD AID


1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

0

2

4

6

8

10

12

14

16

18

20

Global Food Aid Deliveries Declined

(1988-2009)(Million Mt)

Global Food Aid Deliveries

Source: Food Aid Flows Report 2009 by WFP and www.wfp.org/fais/

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Emergency Aid Up, Program Aid Down, Project Aid Up

Emergency Programme Project

Source: www.wfp.org/fais/


1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Direct Transfers Down/Triangulation and Local Purchases Up(% Share)(1988-2009)

Direct Transfer Local PurchaseTriangular Purchase

Source: www.wfp.org/fais/


SSA31%

ASIA33%

MENA18%

LAC18%

Global Food Aid Deliveries by Recipients, by Region

1988Total=14048281 Mt

SSA36%

ASIA28%

MENA9%

LAC7%

EUROPE AND CIS

20%

Global Food Aid Deliveries by Recip-ients, by Region

2000Total=11344752 Mt

Note: Data is not available for Europe and CIS for the year 1988

SSA64%

MENA5%

ASIA24%

LAC5%

EUROPE AND CIS1%

Global Food Aid Deliveries by Recipients, by Region2009

Total=5722764 Mt

Source: www.wfp.org/fais/ and Food Aid Flows Report 2009 by WFP

SSA Growing Recipient of Global Food Aid Deliveries By Region


2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

1000000

2000000

3000000

4000000

5000000

6000000

Total Annual Contributions to WFP(Thousand Dollars)

(2000-2011)

CONTRIBUTIONS TO WFP

Source: WFP Annual Reports (2010, '05 & '03) and www.wfp.org

2000 2001 2002 2003 2004 2005 2006 2007 2008 20090%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

WFP's Share in Global Food Aid(%)

(2000-2009)

WFP's Share in Global Food Aid0thers

Source: WFP Annual Reports (2004 & '03), Food Aid Flows Report 2009 by WFP and

www.wfp.org

HAS BEEN TRANSFORMING ITSELF AS A KNOWLEDGE BANK MOBILIZING

RELEVANT GLOBAL DEVELOPMENT EXPERIENCE

AND MORE GRANT FUNDING

World Bank: Recent Rise in Lending as share of total and still the Largest Single Lender to ARD


FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY100.00

1,000.00

2,000.00

3,000.00

4,000.00

5,000.00

6,000.00

World Bank Lending to Social Protec-tion and Risk Management

Millions of Dollars(2000-2010)

Social protection and risk management

Source: World Bank Annual Reports (2010 &'05)

Official Development Assistance and World Bank Lending to the Agriculture, Forestry and Fishing

Sector (1998-2009)

Source: Growth and productivity in agriculture and agribusiness: Evaluative lessons from World Bank Group experience, IEG 2010.


FY00FY01FY02FY03FY04 FY05

FY06

FY07

FY08

FY09

FY10

0

10000

20000

30000

40000

50000

60000

70000

World Bank Operational Summary


Total CommitmentsTotal Commitments of which Development Policy Lending Gross DisbursementsGross Disbursements of which Development Policy Lending Net Disbursements

Source: World Bank Annual Reports

FY01FY02

FY03FY04

FY05

FY06

FY07

FY08

FY09

0

100

200

300

400

500

600

700

800

IFAD Operational Summary


Total IFAD Loans and Grants to AgricultureLoan Dis-bursements (Gross)Loan RepaymentsLoan Dis-bursements (Net)

Source: IFAD Annual Reports


Decline in Technical Capacity at the World Bank:

Does It Matter?


FAO’s Essential Roles“FAO would Need to be Created if it did not

exist”

• Bring Strategic View of the State of Global Food and Agriculture

• Mobilize Information and Knowledge on State of the World’s Food, Agriculture, Forestry and Fisheries and Agriculturally Related Natural Resources

• Provide a Neutral Platform for discussion and reaching of International Agreements and Standard Setting—food safety, Plant Genetic Resources, Agricultural Practices

• Promote Guidelines and Their Implementation

• FAO-CP ‘s Support for World Bank Lending

• Other TA/Regional Offices• Emergency Assistance growing most

rapidly through voluntary contributions


FAO’S Total Approved Biannual Regular Budget (USD Million) (2000/01-2010/11)

2000-01 2002-03 2004-05 2006-07 2008-2009 2010-11

0

200

400

600

800

1000

1200

FAO: Total Approved Regular BudgetUSD Million

2000-01---2010-11(Biennial)

Total Approved Regular Budget

Linear (Total Approved Regular Budget)

Source: FAO: The Director General's Medium Term Plan 2010-13 and Program of Work &

Budget 2010-11 Report

Foot Note: The above figure shows FAO’s regular program budget is funded by its members, through contributions, adjusted to the Euro/US dollar exchange rate fixed by the FAO Conference. This budget covers core technical work, cooperation and partnerships including the Technical Cooperation Program, knowledge exchange, policy and advocacy, direction and administration, governance and security.The FAO’s regular budget for the biennium 2010-2011 has been increased by 7.6% to US$ 1000.5 million from the biennium 2008–2009 US$ 929.8 million, adjusted to the Euro/US dollar exchange rate fixed by the FAO Conference. Member states froze FAO's budget from 1994 through 2001 at US$650 million per biennium. The budget was raised slightly to US$651.8 million for 2002–03 and jumped to US$749 million for 2004–05, but this nominal increase was seen as a decline in real terms. In November 2005, the FAO governing Conference voted for a two-year budget appropriation of US$765.7 million for 2006–2007; once again, the increase only partially offset rising costs due to inflation.

Total Biennial Resources Available (1994-2007)

Foot Note: This figure shows FAO’s biennial resources in terms of US $ ‘000 at 1994 constant prices.

Source: FAO: The Challenge of Renewal: Report of the Independent External Evaluation of the Food and

Agriculture Organization of the United Nations (FAO): September 2007--figure 7.1.


2000-01 2002-03 2004-05 2006-07 2008-09 2010-110

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

WHO: Total Biennium Program Budget (US$ Million)(Biennium)

(2000-01/2010-11)

Biennium Program Budget (US$ Million)Linear (Biennium Program Budget (US$ Million))

Source: www.who.int/gb/

US $

Mil

lion

2000-01

2002-03

2004-05

2006-07

2008-09

2010-11

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

WHO: Voluntary Contribution and Regular Budget

(Biennium Program Budget)(US $ Million)

(2000-01/2010-11)

Regular Budget Financing Voluntary Contribution

Source: www.who.int/gb/

US $

Mil

lion


ZERO HUNGER AND SUSTAINABLE INTENSIFICATION OF

SMALL FARM AGRICULTURE:

WALKING ON TWO LEGS: PRODUCTIVITY GROWTH AND EFFECTIVE SAFETY NETS

Looking To the Future


A Five Point Agenda for G 20: Harmonization Under Conditions of Extreme

Fragmentation

UN and FAO Information and Knowledge Managing Natural Resources: Water, Climate, Biodiversity Standards for the Multiple Roles of the Private sector in Agricultural Development Technical Assistance

Emergencies and Food Aid—WFP , FAO and IFAD Investments in Global, National and Local Research and Innovation:

$14 leveraging North-South and South South Cooperation Global Policy on Technology, intellectual Property and GMOs: How might those

issues be addressed? Investments in Agricultural and Rural Development+ Roads, Health,

Education, Water and Sanitation, Power, IT World Bank and Regional Banks, BRINCS Abolition of Chronic Hunger and Food Security—Put women and Children at the

Center Stage Health, Nutrition and Food and Safety Nets and Standards

Agricultural Trade Liberalization, Pricing, Subsidies and Doha

Annual Cost of Bringing Populations to the Poverty Line: Possible G 20 Agenda?

Lele, Agarwal, Goswami, AAEA 2011Ban

glad

esh

Indi

a

Pakista

n

Cambo

dia

China

Indo

nesia

Philip

pine

s

Ivor

y Coa

st

Ethip

iia

Ghana

Kenya

Moz

ambi

que

Nig

eria

South

Africa

Tanza

nia

Uga

nda

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

0.5

% of GDP Needed to Meet MDG 1 Poverty Target in Asian and Sub-Sahara African Countries

% of GDP

% o

f G

DP

needed t

o m

eet

MD

G 1

Povert

y T

arg

et

In SSA Countries the cost is higher because the extent and depth of poverty is greater than Asian Countries.

Calculation

% of GDP needed to meet MDG 1 Poverty Target= (Gap/ GDP million $)

Where, Gap= ($1.25* 365* Population* Poverty Gap)/100

.


Investment Challenge: Funding Volatility Needs to be Replaced by Funding Predictability and Stability

0

83

166

249

332

415

0

5

10

15

20

25

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008

Million 2005 PPP dollars

Billi

on 2

005

naira

NARIs (15) Other government (7) Higher education (66)

0

5

10

15

20

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008

Billi

on 2

005

CFA

fran

cs

ISRA ITA Higher education (7)

0

9

18

26

35

0

2

4

6

8

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008

Billi

on 2

005

CFA

fran

cs

INRAN CMB Higher education (4)

Million 2005 PPP dollars

0

10

20

30

40

0

2

4

6

8

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008

Millions de dollars PPA

2005Mill

iard

s de

fran

cs C

FA 2

005

INERA et prédécesseurs Autres agences d'État (12)Enseignement supérieur (4)

Senegal

Nigeria

NigerBurkina Faso

Source: ASTI as reported in Beintema and Stads (2011)

uma lele, manmohan agarwal sambuddha goswami "global agricultural development: changing aid...

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food preferences

sustainable food security

agriculture slide

food security election

food price rise

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effective global architecture

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