LIVESTOCK AND THE PUBLIC GOOD NEXUSJimmy W. Smith

World Bank

IADG Annual MeetingIFAD, Rome, Italy

May 4-5, 2010

� Ways to think about the Public Good nexus� The status quo � Increasing the Public Good contributions

Thinking about Public Goods – Based on Economic Principles

Pure Public Goods share two qualities:

Nonexcludability --which means that when provided to one party, the public good is provided to all.

Nonrivalary --which means that the consumption of the Public Good by one party does not reduce the amount available to others.

High excludability

HighRivalry

Pure Public GoodsPoverty reductionBorder quarantine Food safety inspectionProtection against contagious diseasesAnimal health intelligence Disease data systems

Common Pool GoodsCommunal rangelandsWater (volume and quality)Air quality (including protection against climate change)Animal genetic resources and other sources of biodiversity

Club GoodsStandards and certification systemsFace-to-face advisory servicesCollective action in disease (tick dips) control

Private GoodsOn-farm production, processing, and distribution (quality standards)Most clinical veterinary and breeding servicesMost input supplies (feed, seed, etc.)

Funding Responsibility

For Imp.

Oversight

Pure Public Goods

Veterinary health

• Border quarantine Public sector Public sector Mainly national Veterinary

Services (VS)

• Surveillance of

main contagious

diseases

Public sector Preferably in

subcontract with

private operators

Mainly district service, with

clear lines to national VS, with

international support in

developing countries and

international coordination

among all countries

• Early alert and

response for main

contagious

diseases

Public sector Preferably in

subcontract with

private operators

Mainly national VS with

international support

• Vaccination Public/private

partnership

Mostly private sector Mainly national VS with

international support

• Vaccine development

Public/private

partnership

Mostly private sector National or regional public

institutions

• Disease data systems

Public/private

partnership

Mainly public sector Mainly national VS with

international support

Food safety and human public health

Public/private

partnership

Preferably in

subcontract with

private operators

Mainly local, within overall

guidelines of national and,

eventually, international buyers

Research and education

Public/private

partnership

Preferably private with

subcontracts

Public/private at corresponding

levels

SOME EXAMPLES -- PUBLIC GOOD, ROLE & RESPONSIBILITY

Eradicate extreme poverty and hunger� At least 50 % of income, food and

arable farming inputs for 700 million poor, even in middle income countries:

� Indonesia: Only 3 percent poultry meat from large farms

� India: 5.5 percent of national workforce in dairy sector

Achieve universal education� Critical cash to pay school feesPromote gender equality� Sole source of income and

inheritance transfers for women

Reduce Child Mortality� Critical cash to pay health expenses� Essential mineral and vitamin source

to supplement poor basal dietsImprove maternal health

� Milk to supplement breast feeding and enhance overall maternal health

Combat HIV/AIDS, malaria and other diseases

� Traction to reduce drudgery of labor of weakened farming population

� Opportunities to combine health services

Ensure environmental sustainability� Organic Fertilizer for about half

total nutrient needs� Traction for about one-third of the

world’s total arable land� Income to buy inputs for cropsDevelop a global partnership� Responding to critical research

needs� Opportunity for global action on

emerging zoonotic diseases� Opportunities to act collectively to

control GHG from livestock

Early 1980s

Early 1990s

Early 2000s

Official development assistance

(ODA): 17%

World Bank lending: 30%

Official development assistance

(ODA): 12%

World Bank lending: 15%

Official development assistance

(ODA): 4%

World Bank lending: <10%…but overall

ODA has not

recovered

World Bank lending

is recovering …..

OFFICIAL DEVELOPMENT

ASSISTANCE

PUBLIC SPENDING(Sub-Saharan Africa)

AGRICULTURE

4%

RURAL

75%

AGRICULTURE

4%

Challenges

WORLD POOR

� Investment at the national level is limited:

� Only 3 countries had PRSPs with detailed strategy and budget for livestock and poverty reduction

� None had specified investments under Poverty Reduction Strategy Credits; and

� Low investment from national budgets (estimated 15-20 percent of Agricultural budget)

� For example, Mali: Livestock about 35 percent of Ag. GDP but MinAg. budget: 91.6 % arable farming, 3.6 % livestock and 1% for fisheries

14

Increasing the Public Good Contributions

– 2.5 billion people

depend directly on

agriculture

– 800 m smallholders

– 75% of poor are rural

and the majority will

be rural to about 2040

Global extreme poverty 2002, $1.08 a dayGlobal extreme poverty 2002, $1.08 a day

GlobalUrban poor287 mill. South

Asia rural 407 mill.

Sub-SaharanAfrica rural 229 mill.

East Asia rural

218 mill.LAC rural27 mill.

ECA rural5 mill.

MENA rural5 mill.

Poverty ReductionPoverty ReductionPoverty ReductionPoverty Reduction

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Mitigating the effects of livestock on the environment

Mitigating the effects of climate change on livestock

Mitigating the effects of livestock on the environment

Mitigating the effects of climate change on livestock

Important user of natural resources :

� 70-75% of fresh water resources

� 40% of land area

� 25-30% of greenhouse gas emissions

Contributions to Greenhouse Gas Emissions

Developing country

agriculture & deforestation

21%

Developing country

other sources

15%

Industrialized countries

64%

Agriculture based countries

Mainly SS-Africa

417 million rural people

Transforming countries

Mainly Asia, MENA

2.2 billion rural people

Urbanized countries

Mainly Latin America

255 million rural people

Agr

icul

ture

’s s

hare

in g

row

th 1

990-

2005

Rural poor/total poor, 2002

Three Worlds of Agriculture

0 100%

80%

0

50%

20%

20

� Operation Flood in India� Cooperative movement now with about 130,000 member

coops, serving 14 million farmers, including 3.7 million women processing about 20 million ton milk annually

� Pastoral development in East Africa� Ethiopian and Kenyan pastoral development projects working

for the poorest group of society rated moderately satisfactory or better for outcomes

� Support research for “technologies for the poor”� Develop remedies to “livestock diseases of the poor”

� Develop alternative feeds resources

� Support better integration of smallholders in the value chain

� Promote, where needed, exits from the sector

� Public health:� Six major zoonotic disease scares over last decade with economic

losses over US $ 200 billion (direct and indirect) over the last decade

� Of 1415 known pathogens, 62 percent of animal origin

� 1.6 million annual TB fatalities of which 2-15 percent of bovine origin

� Food borne pathogens important contributor to diarrheal diseases

� Contribution to obesity and other food related health risks

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Building on the HPAI efforts to promote the “One Health” concept:

At the international

level seek to promote:� Permanent global Coordination mechanisms� Sustainable funding Mechanisms

At the national level seek to promote:

� Permanent coordination mechanisms� Horizontal communication� Facility and skill sharing

� Prevent and control the ‘lingering’ zoonotic diseases whih mostly affect the poor

� Further strengthen veterinary public health services/mechanisms.

Livestock sector is major contributor to greenhouse gas emission, important eroder of bio-diversity; cause of land degradation and water pollution

� Use one quarter of total terrestrial land and one third of total crop land

� Contribute to 20 percent rangeland degradation

� Emit 18 percent of anthropogenic Greenhouse Gasses

� Use 15 percent of global agriculture water

� Pose a threat to bio-diversity in 306 of the 825 eco-regions

� Changing climatic effects on feed & water resources, pathogens and disease dynamics

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� Continue to work on payment for environmental services:� Use PES to reduce deforestation of hunid tropical forest;� Shift pastoralists in arid areas from livestock herders to stewards of

the landscape

� Expand work on environmental mitigation of intensive livestock production systems;

� Promote innovation in livestock waste management

� Increase attention to livestock and Global Climate Change� Reducing GHG emission� Adapting livestock systems to GCC

THANK YOU