Why Hunger in Asia? Agricultural and Rural Development for Reducing Food Insecurity

Why Hunger in Asia?

Agricultural and Rural Development

for Reducing Food Insecurity

Joachim von BraunInternational Food Policy Research Institute

Agriculture and Rural Development Daybreak Seminar Series

USAID, Washington DC

June 3, 2009

Joachim von Braun, IFPRI, June 2009

IFPRI’s Offices and programs in Asia*

IFPRI Dakar

IFPRI Accra

IFPRI Abuja

IFPRI BeijingIFPRI Headquarters,

Washington, D.C.

IFPRI Kampala

IFPRI Addis Ababa

IFPRI New Delhi

IFPRI Rome

**

**

***

*


Field Rank # Institutions

Ag. Economics 2 897

Africa 3 755

China 9 475

Development Economics 13 1585

Central & Western Asia 24 813

South East Asia 25 1062

RePEc (Research Papers in Economics) May 22, 2009

IFPRI ranking: top 1% of development

economics institutions and top 1 - 3% in Asia


Overview

1. Present realities: hunger and poverty

2. Emerging trends and challenges

3. Recounting the role of agriculture and

rural development: Agenda for action


China44%

REA&P13%

India22%

RSA7%

SSA11%

Others3%

1981Population living below $1.25 a day = 1904 mil

Rest of East Asia and Pacific

Rest of South Asia

China15%

REA&P9%

India33%

RSA10%

SSA27%

Others6%

2005Population living below $1.25 a day = 1400 mil

Source: Chen and Ravallion 2008.

Global poverty scenario:

Asia now home to 67% of the poor


912 million people remain poor in South

and East Asia

Poverty at $1/day, 2005 PPP

Source: Chen and Ravallion 2008.

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1981 1987 1993 1999 2005

Bil

lio

ns

East Asia and Pacific

South Asia

Sub-Saharan Africa


Groups excluded from poverty reduction

remain among the poorest in Asia

• Laos: prevalence of poverty is more than twice as

high among the minority Mon-Khmer than the

majority Lao

• Vietnam: incidence of poverty is more than 6 times

higher among ethnic minorities than among the

Kinh and Chinese

• India: scheduled castes and tribes are

overrepresented among the poor (more true for

scheduled tribes than for scheduled castes)

Source: Ahmed et al. 2008.


Asia home to largest number of

undernourished peopleCountries resized relative to undernourished population

in 2000

Source: Worldmapper 2009.

http://www.worldmapper.org/images/largepng/178.png


Hunger “alarming” in parts of Asia:

2008 Global Hunger Index (GHI)

Source: von Grebmer et al., IFPRI 2008.


And “extremely alarming” in some regions:

2008 India State Hunger Index (ISHI)

Source: Menon et al. 2008.

- 12 of 17 states:

“alarming”

- Madhya Pradesh:

“extremely alarming”


Problem zone “under–two” worst in Asia

Source: Shrimpton et al. 2001.

Weight for age by region

-2

-1.75

-1.5

-1.25

-1

-0.75

-0.5

-0.25

0

0.25

0.5

0 3 6 9 12 15 18 21 24 27 30 33 36 39 42 45 48 51 54 57 60

Age (months)

Z-s

co

re (

NC

HS

)

Africa Latin America and Caribbean Asia


Overview






Rank Country Overall

vulnerability

index

Micro-

vulnerability

index

Macro-

vulnerability

index

Population

(mil.)

1 Eritrea 1.65 1.48 2.05 4.7

2 Ethiopia 1.54 1.64 1.39 77.2

3 Sierra Leone 1.52 1.77 1.07 5.7

4 Yemen 1.51 1.47 1.63 21.7

5 Haiti 1.44 1.13 2.11 9.4

6 Liberia 1.37 1.56 1.02 3.6

7 Bangladesh 1.24 1.77 0.23 156.0

8 Myanmar 1.16 0.53 2.45 48.4

9 Djibouti 1.16 0.88 1.75 0.8

10 Malawi 1.13 1.40 0.63 13.6

11 Zambia 1.11 1.47 0.43 11.7

12 Madagascar 1.10 1.26 0.81 19.2

13 Cambodia 1.06 1.57 0.05 14.2

14 Angola 1.03 0.97 1.17 16.6

15 Sri Lanka 0.97 0.73 1.48 19.9

16 Zimbabwe 0.96 0.96 0.98 13.2

17 Tajikistan 0.93 1.03 0.76 6.6

Food price shocks: Some Asian countries

are among the most vulnerable

Source: Headey and Fan 2008.


Slower growth and global financial crisis

0

2

4

6

8

10

12

14

20

00

20

01

20

02

20

03

2004

20

05

20

06

20

07

20

08

20

09

20

10

2011

20

12

2013

20

14

Developing AsiaChinaIndia

GDP, annual % change

constant prices

Source: IMF 2009.

•Less capital for

agriculture

•Higher debt burden for

farmers

•Reduced employment

and wages of

unskilled workers

•Reduced remittances


Asian countries facing increasing overall

risks for the future

Country

Lao PDR H

Tajikistan H

Vietnam H

Afghanistan M

Bangladesh M

Cambodia M

India M

Pakistan M

Sri Lanka M

Myanmar L

Nepal L

China n.aSource: IMF 2009.

Overall vulnerability to the global downturn


Fragmenting farms (e.g. India)

0%

20%

40%

60%

80%

100%

1970-71 1980-81 1990-91 1995-96 2000-01

Area of Holdings-India

Less than 2 hectares 2-4 hectares 4 and above hectares

0%

20%

40%

60%

80%

100%

1970-71 1980-81 1990-91 1995-96 2000-01

Number of holdings-India

Avg. Size 2.3 1.82 1.55 1.41 1.37

Source: Agricultural Census Division, India.


Agriculture growth not matching price

increases

-6

-4

-2

0

2

4

6

8

10

1990 1992 1994 1996 1998 2000 2002 2004 2006

East Asia & Pacific

South Asia

Source: WDI 2008 and FAO 2009.

•Food prices remain at

historically high levels

in several countries

•Increases in rice

production since 2007

only marginal

•Food supply and

market access

difficulties persist

Agriculture value added

(annual % growth)


Agricultural productivity growth in

developing countries

%

East Asia 2.7

South Asia 1.0

East Africa 0.4

West Africa 1.6

Southern Africa 1.3

Latin America 2.7

North Africa & West Asia 1.4

All regions 2.1

Annual total factor productivity growth, 1992-2003

Source: von Braun et al. 2008.


Agricultural growth has large poverty

reduction impact

Poverty reduction elasticities of agricultural growth

SSA -1.83

South Asia -1.73

East Asia and Pacific -1.44

Eastern and Central Europe -1.57

Latin America -1.11

Middle East and North Africa -0.92

All Low Income Countries -1.6

Source: Christaensen et al (2005)

Low Income Countries


Largest global CO2 emitters

Source: World Bank and IEA 2007; USEPA 2005; Houghton 2006.


Climate induced change in production in 2050:

Irrigated rice -16.2%


Cereal demand:

1995 and 2025 Business as usual (BAU)

Source: Rosegrant et al. 2002.

171

375

114 55

794

275

581

176 102

1228

0

300

600

900

1200

1500

India China Southeast

Asia

South Asia

(excluding

India)

Asia

mil

lio

n m

etr

ic t

on

1995 2025


Meat demand:

1995 and 2025 BAU

4

47

8 3

72

10

102

197

154

0

30

60

90

120

150

180

India China Southeast

Asia

South Asia

(excluding

India)

Asia

mil

lio

n m

etr

ic t

on

1995 2025

Source: Rosegrant et al. 2002.


Overview






Strategic agenda

1. Promote pro-poor agriculture growth with

technology and institutional innovations

2. Facilitate open trade and reduce market

volatility

3. Expand social protection and child

nutrition action


Agriculture R&D, roads, education

among highest return public investments

China India Thailand Vietnam Uganda

Ranking of Returns in Agricultural Production

Agricultural R&D 1 1 1 1 1

Irrigation 5 4 5 4

Education 2 3 3 3 3

Roads 3 2 4 2 2

Telecommunications 4

Electricity 6 8 2

Health 7 4

Soil and Water Conservation 6

Anti-Poverty Programs 5

Ranking of Returns in Poverty Reduction

Agricultural R&D 2 2 2 3 1

Irrigation 6 7 5 4

Education 1 3 4 1 3

Roads 3 1 3 2 2

Telecommunications 5

Electricity 4 8 1

Health 6 4

Soil and Water Conservation 5

Anti-Poverty Programs 7 4

Shenggen Fan et. al. IFPRI 2008


Central for long-term agric. growth:

Double public agric. R&D to impact poverty

CGIAR investment to rise from US$0.5 to US$1.0 billion

as part of this expansion

Source: von Braun, Shenggen Fan, et al. 2008.

R&D allocation

(mil. 2005 $)

in # of

poor (mil.)

2008-2020

+ Agr. output

growth (% pts.)

2008-20202008* 2013

SSA 608 2,913 -143.8 2.8

S Asia 908 3,111 -124.6 2.4

Devel.ing

world 4,975 9,951 -282.1 1.1


With supporting public investments,

farmers can respond to higher prices

But government investments in seeds, fertilizer,

irrigation, and rural infrastructure are critical

In response to the food crisis:

- China: agric. spending +30% in 2008

- India: agric. spending +20% in 2008

Plus 2009 stimulus packages:

- China: 109 bil. US$ for agriculture

- India: also increased ++


Moving from staples to high-value

agriculture

• Rapid transformation in agri-system in Asia

resulting from diet diversification & supply

factors

• Opportunity for small holders if they can

connect to new markets, else a major

challenge to remain afloat

• HVP require a shift in policy approach from

farming to agri-system.……of value chains


Key climate change adaptation policies

and investments for Asia

• Crop breeding for biotic and abiotic stresses

agricultural productivity growth remains key to

future food security under climate change

• Enhanced water control (to adapt to sea-level

rise, glacier melting and extreme events)

• Knowledge, information and risk sharing

approaches to support flexible farmer

adaptation

• Market-based approaches to manage

environmental services combined with secure

property rights


In sum: Actions for agricultural productivity

• Access to finance (e.g. rural banks and micro-finance)

• Expansion of risk management (e.g. crop insurance)

• Access to inputs (e.g. quality seeds, fertilizer, feed, veterinary drugs)

• Access to services, extension

• Investment in rural infrastructure (rural roads, electrification, water and irrigation)


2. What to do about volatility?

1. Keep trade open at times of global and

regional food shortage is a must

2. Regulation of food commodity markets? (as

part of financial markets)

3. Establish grain reserves policy at global level

(emergency reserve, shared physical

reserves, and a virtual reserve > a new

institution at global level needed) with strong

Asian participation


3. Support pro-poor food and nutrition

interventions

Protective actions e.g.:

• Cash transfers

• Employment-based food security programs

Preventive actions e.g.:

• School feeding

• Early childhood nutrition programs

Focus on children, women, and poorest


Scaling up social protection

• All Asian countries have some form of social protection through targeted safety net and social security programs

• Interventions need to be scaled up and expanded, which would require:

- additional investments- strengthening of the knowledge base and

capacity

• Country-specific conditions should dictate the choice and design of social protection interventions


Implementation of strategic agenda in

partnerships

A focus on

• Science and technology for rural growth

• Trade and market institutions

• Government effectiveness

• Public – private cooperation

How?

> Adjusted to country typology – the

tremendous diversity of Asia

> Strategic partnerships with China and India

> Due attention to the agriculture and food links

to security


Tajikistan is the most food insecure (weather and

soil fertility are constraints to agric. production)

Cambodia ranks 2nd in food insecurity (increased

irrigation and soil management are key)

Bangladesh ranks 3rd (increased irrigation is top

priority)

Laos and Nepal also rank high (irrigation should be

the top in investment priorities)

Sri Lanka, Philippines have potential (governance

& stability should be priority)

Among food insecure Asian countries

Source: Headey and Fan 2008.


Improve government effectiveness

Source: Kaufmann et al. 2008.


Consider strategic partnerships

Networks of research leaders, innovative business

leaders, and civil society:

for food security, rural change, agriculture and

policy-making

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Why Hunger in Asia? Agricultural and Rural Development for Reducing Food Insecurity