Sustaining Technological Progress in Agriculture

Cees de Haan

World Bank

Overview of Presentation

Three key words of the title: Agriculture; Technology;

Development Delivery

Sustainability. …. Implementation and cooperation

Agriculture technology is important

Agriculture still the engine of rural growth; Source of employment for half developing countries

labor force; Agriculture is facing new productivity challenges

Increasing land and water scarcity, shifting demand (“the Livestock Revolution”, other high value products)

Agriculture is facing new quality challenges Trade liberalization, urbanization and increased

consumer demands,

But lending for Agriculture is declining Figure 2.1: IBRD/IDA Agriculture Sector Approvals, FY 1970-2001: FY2001 $ million; percent of

total Bank

0

1,000

2,000

3,000

4,000

5,000

6,000

1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000

FY

01 $

millio

n

0

5

10

15

20

25

30

35

40

45

perc

ent

- - - - 3 year moving average (Agriculture) _______ 3 year moving average (Agriculture as a % of total Bank)

And the same for agricultural technology

0

100

200

300

400

500

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

$US

Mil

lion

Research Extension

With an apparent low share for research

Total Committed = $US 2.2 billion

Education1%

Extension63%

Research36%

Total Loan Commitments in the Research and Extension Portfolio, 2002

Key components of agricultural growth:

Improvement in the productivity of the entire food chain, by improving factor productivity, competitiveness, access to markets;

Diversification of agriculture and boosting high-value products;

Reduction of post-harvest losses and Tailoring agenda according to the major farm

types

Source: Reaching the Rural Poor

 

UN

FA

VO

RA

BLE PR

OD

UCT

IO

N

EN

VIRO

NM

EN

T

FA

VO

RA

BLE PR

OD

UCT

IO

N

EN

VIRO

NM

EN

TS

LOW ASSET POSITI ON

C

B

A

HI GH ASSET POSI TI ON

C: Subsistence FarmersC: Subsistence Farmers

Strategy

Targeting investments to poorer regions, minorities, etc

Strengthening local institutions and organizations that can best support farmers with scarce resources and develop market-oriented enterprises.

Facilitating participatory development of local infrastructure and technology in collaboration with NGOs.

Poverty Impact

Development of human and social capital necessary to address wider problems.

Development of niche commodities such as organic produce that are labor intensive.

Reduction of vulnerability Employment generation

B: Small Market Oriented FarmersB: Small Market Oriented Farmers

Strategy Developing an efficient agricultural

technology system to meet the needs of small farmers.

Supporting innovative communication systems to supply relevant information on production, markets and alternative crops.

Promoting small farmers’ organizations to coordinate input and marketing needs.

Poverty Impact Broad-based growth to

generate income for small-scale farmers.

Increased productivity to reduce food prices for

non-tradables.

A: Commercial FarmersA: Commercial Farmers

Strategy Assistance to develop and employ food

and biosafety regulations and systems for quality assurance, traceability and certification

Strengthening of legal frameworks for property rights to promote private R&D and secure tenancy.

Strengthening producer organizations to represent member interests and promote initiatives in the industry.

Supporting development of diverse and competitive agricultural/agro-industrial innovation systems based on user-

financing and private service delivery.

Poverty impacts Development of

labor-intensive high-value systems to generate employment for the poor.

Increasing productivity to reduce food prices for non-tradables

 

UN

FA

VO

RA

BLE PR

OD

UCT

IO

N

EN

VIRO

NM

EN

T

FA

VO

RA

BLE PR

OD

UCT

IO

N

EN

VIRO

NM

EN

TS

LOW ASSET POSITI ON

C

B

A

HI GH ASSET POSI TI ON

Public

service

Private

Focus in Technology Generation

Technology generation should become more holistic: Cover the entire food chain (farm to table); Greater attention to efficiency of input use (water, feed grain); Use all tools (traditional breeding and bio-technology, agro-

ecological approaches, IT); Become much more client driven; and Strengthen public and private partnerships and private investments.

i.e. technological progress in agriculture needs to become more pluralistic and knowledge intensive, less dependent on the “silver bullet”

Focus in Technology Delivery

Evolving concepts and approaches Greater differentiation between public, commercial and

private services Public services, where market failures occur (poor, NRM,

organizations) Commercial and private services where markets function

Pluralistic institutional arrangements Decentralized, participatory, competitive.

Experimentation with new approaches ICT, mass media, etc.

Issues in Technological Services

Crowding out by the State and donors; Seed (testing, parastatals), fertilizer (subsidies),

emergency aid;

Poor being marginalized Economies of scale in food safety and quality

Sustainability of investments; Financial and institutional

Sustainability and poverty focus

Sustainability of Completed World Bank Project

0102030405060708090

100

95 96 97 98 99 '00 '01

All BankAgriculture

Interventions, with a lasting impact

Discussion of OED factors in ICR [FY1998-2000, n=75 projects]

OED factor

Number of projects

(out of 75)

Projects where one or more issues per

factor were discussed %

Financial 67 89 I nstitutional 65 87 Technical 58 77 Government Ownership 29 39 Other Stakeholders 20 27 Exogenous 13 17 Environmental 12 16 Social 11 15 Economic 8 11

Key Factors affecting Sustainability

OED Factor

Irrigation and

Drainage

NRM &

Forestry

Research and

Extension

Average of total sample

(n=19) (n=17) (n=12) (n=75)

Financial 89 82 100 89

Institutional 79 82 100 87

Technical 89 65 67 77

Govt. Ownership 53 35 33 39

Other Stakeholders 32 70 17 27

Exogenous 11 12 8 17

Environmental 26 18 8 16

Social 37 12 8 15

Economic 0 12 0 11

Project documentation on poverty focus by sector [FY99-00, n=92 projects]

Percentage of projects in best-performing category (‘Aspects less than fully taken into account’ by sector

Sector

Diagnosis (%)

Strategy (%)

Design (%)

No. of projects

in sample

Social protection 22 89 89 9

Environment 14 29 0 7

Agriculture 11 25 20 44

Education 0 25 13 8

Health 0 13 13 8

Transport 0 14 14 7

Conclusion:

Seek to increase investments in agriculture; Enhance the poverty impact Pay particular attention to post-investment

financing mechanisms; and Develop pluralistic approaches to technology

generation and delivery.

RRP approach: development of sustained political support for the sector

Two main thrusts: Develop national “home grown” rural

strategies, involving all stakeholders, for integration in new development planning instruments (PRSP, CAS) to establish domestic power base for rural areas; and

Scale up areas of good practice to reach increased number of poor to convince politicians of the benefits of rural investments.

Key Issue: How to get into the Poverty Reduction Strategy Papers (PRSP)

Poverty focused, client (country) driven, multi-sectoral, strategy papers

Main input into Bank’s Country Assistance Program (CAS);

Leading to fewer, programmatic, multi-sectoral lending operations.

How can we ensure that the need for technological progress is adequately heard in this broader and more competitive environment

Key issue: How do we scale-up good practices?

Criteria for up-scalable good practice: Contribution to poverty reduction, cover large

population, low investment per capita, suitable for partnering and programmatic lending.

Key candidates: CDD, land reform, watershed development, financing mechanisms for technology generation

Key issue: HOW

Innovation with impact

Human

Institutional

Natural resource

Socio-economic, technical

local province national

Horizontal scaling up, e.g. farmer to farmer

 

Vertical scaling up through policy or administrative change

 

                         

 

Inputs into scaling up “good practice”

Elements Unbundling the practice Evaluating the practice

Successes and failures Introduction into the policy dialogue and priority setting;

and demand vs. supply driven

Knowledge management, including learning mechanisms.

Key areas of cooperation

Working jointly on agricultural approach paper Expanding the political foundation

Assisting in development of “homegrown” rural strategies; Working jointly on institutional issues in technology

Sustainability, participatory priority setting; Working on scaling up

Evaluation, methodologies Participating in project preparation. How: Short missions, Secondment, Sabaticals, Staff exchange etc, Issue for discussion: How to finance cooperation

Thank you