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Joyce Cacho, Ph.D.
   Challenges or Opportunities?    ◦ Climate Change    ◦ Agricultural Productivity    ◦ Enterprise Risk Management   Sus...
   Challenges or Opportunities?    ◦ Climate Change    ◦ Agricultural Productivity    ◦ Enterprise Risk Management   Sus...
…andRISK       http://www.climatechange.gov.au/community/~/media/       publications/local-govt/risk-management.ashx
Dimension of climate impact: EXTREME WEATHERPHYSICAL           ✔CLIMATEIMPACTS                 SOURCE: http://www.cgdev.or...
Dimension of climate impact: EXTREME WEATHER PHYSICAL               ✔ IMPACTSadjusted for  COPING  ABILITY                ...
Dimension of climate impact: EXTREME WEATHER           ✔PHYSICALCLIMATEIMPACTS                 SOURCE: http://www.cgdev.or...
Dimension of climate impact: EXTREME WEATHER PHYSICAL               ✔ IMPACTSadjusted for  COPING  ABILITY                ...
Dimension of climate impact: EXTREME WEATHERPHYSICAL   ✔CLIMATEIMPACTS                 SOURCE: http://www.cgdev.org/conten...
Dimension of climate impact: EXTREME WEATHER PHYSICAL IMPACTS               ✔adjusted for  COPING  ABILITY                ...
TRENDS   Historically, productivity in agriculture has shown high growth rates.   Together with the expansion of the res...
TRENDS   Other studies, in particular those using partial factor productivity indicators such as    land and labor produc...
TRENDS   The average global rates of growth in yield of most of the major cereals are declining.   Since the 1980s, grow...
LOOKING AHEAD   SUSTAINABILITY (Environmental, Economic, Social)…Efforts to increase food production will    take place w...
LOOKING AHEAD   WATER MANAGEMENT…Agriculture is also a major source of water pollution, from    nutrients, pesticides, so...
LOOKING AHEAD   TOTAL ROI from R&D: Estimates of the rates of return to agricultural R&D suggest a very    high social va...
INSURANCE INDUSTRY   Key driver of the U.S. economy.   Stimulate trillions of dollars in    private investment and influ...
INSURANCE INDUSTRY   In coastal and non-coastal areas    alike, U.S. insured losses triggered    by volatile weather even...
INSURANCE INDUSTRY   Given that weather peril losses    have been trending upward for    years, due to a combination of  ...
BUSINESS STRATEGY + OPERATIONS   In the past…multinationals‟ global operations consistently underperform their    domesti...
Business  Expansion     andOrganizationalDevelopment                 “The Forgotten Strategy” by Pankaj Ghemawat; HBR – No...
• 6 billion mobile/cell phone subscribers in the world    • Growth is led by China + India (30+ percent of     world subsc...
AFRICA    has about 644 Mn subscribers (about 11%)  LTE deployments are quickly gaining momentum (11                    ...
   Challenges or Opportunities?    ◦ Climate Change    ◦ Agricultural Productivity    ◦ Enterprise Risk Management   Sus...
   "People, planet and profit" succinctly    describes the triple bottom lines and the    intention of sustainability.  ...
   Managers of joint products processes must    manage risk in two output markets.   The challenge is to structure the f...
   Managers of joint products processes must manage    risk in two output markets.   The challenge is to structure the f...
   A key policy tool in the transformation of    Brazil‟s soybean industry was:    ◦ Fiscal policy   Tiered tax policy i...
   Joint product economics, combined with    uncertainty and investment theory, may point to    policy directions that su...
   Challenges or Opportunities?    ◦ Climate Change    ◦ Agricultural Productivity    ◦ Enterprise Risk Management   Sus...
   Fiscal policy: a tool to…    ◦ Communicate market priorities to R&D and Marketing      departments in the private and ...
   Economic integration is the unification of economic    policies between different states through the partial or full  ...
http://en.wikipedia.org/wiki/File:Economic_integration_stages_(World).png; Updated 12 January
The Ogallala Aquifer, part of the High PlainsAquifer System, is a vast yet shallowunderground water table aquifer locatedb...
THE TRUE SIZE OF AFRICA                                     REC pillars                                                  A...
Active REC pillarsAfrican Economic Community                             http://en.wikipedia.org/wiki/African_Economic_Com...
Africa‟s rivers and lake basins     cross many borders         http://new.uneca.org/Portals/15/CrossArticle/1/Doc         ...
   Challenges or Opportunities?    ◦ Climate Change    ◦ Agricultural Productivity    ◦ Enterprise Risk Management   Sus...
   Systematic, broad-based, adoption of bundled    technologies will be pivotal to agricultural    productivity growth at...
   Fiscal policy – an innovative policy tool for adoption    of technologies that respond to the multi-faceted    demands...
INSURANCE PRODUCT DESIGN    ◦ What is required to make the insurance industry reflect the      acknowledged impacts from C...
   Multi-disciplinary approach, presents the    increased likelihood of:    ◦ Bringing „inclusiveness‟ to defining water ...
Paldies               σας ευχαριστώ    Merci       Obrigado     谢谢                            mulţumescБлагодаря ви       ...
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Joyce Cacho Water for Food Presentation

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Transcript of "Joyce Cacho Water for Food Presentation"

  1. 1. Joyce Cacho, Ph.D.
  2. 2.  Challenges or Opportunities? ◦ Climate Change ◦ Agricultural Productivity ◦ Enterprise Risk Management Sustainability + Joint Product Economics Policy, Innovation, Investment ◦ Regional Markets Adoption for Transformation + Resilience
  3. 3.  Challenges or Opportunities? ◦ Climate Change ◦ Agricultural Productivity ◦ Enterprise Risk Management Sustainability + Joint Product Economics Policy, Innovation, Investment ◦ Regional Markets Adoption for Transformation + Resilience
  4. 4. …andRISK http://www.climatechange.gov.au/community/~/media/ publications/local-govt/risk-management.ashx
  5. 5. Dimension of climate impact: EXTREME WEATHERPHYSICAL ✔CLIMATEIMPACTS SOURCE: http://www.cgdev.org/content/publications/detail/1424759/
  6. 6. Dimension of climate impact: EXTREME WEATHER PHYSICAL ✔ IMPACTSadjusted for COPING ABILITY SOURCE: http://www.cgdev.org/content/publications/detail/1424759/
  7. 7. Dimension of climate impact: EXTREME WEATHER ✔PHYSICALCLIMATEIMPACTS SOURCE: http://www.cgdev.org/content/publications/detail/1424759/
  8. 8. Dimension of climate impact: EXTREME WEATHER PHYSICAL ✔ IMPACTSadjusted for COPING ABILITY SOURCE: http://www.cgdev.org/content/publications/detail/1424759/
  9. 9. Dimension of climate impact: EXTREME WEATHERPHYSICAL ✔CLIMATEIMPACTS SOURCE: http://www.cgdev.org/content/publications/detail/1424759/
  10. 10. Dimension of climate impact: EXTREME WEATHER PHYSICAL IMPACTS ✔adjusted for COPING ABILITY SOURCE: http://www.cgdev.org/content/publications/detail/1424759/
  11. 11. TRENDS Historically, productivity in agriculture has shown high growth rates. Together with the expansion of the resource base, this has enabled food production to outpace population growth. The Green Revolution resulted in an increase in food production from 800 million tons to more than 2.2 billion tons between 1961 and 2000 (FAO, 2011a). Estimates of past and current productivity trends vary widely Future productivity in the long run is difficult to project. Some recent estimates suggest that total factor productivity (TFP), the most comprehensive measure of productivity reflecting the efficiency to turn all inputs into outputs, grew at an average rate of around 2% per year since 2000 across major world regions (Fuglie, 2012). The picture is more complex when looking at individual countries or sub-regions. ◦ Some large countries like Brazil, China, Indonesia, Russia and Ukraine have achieved much higher TFP growth rates than the corresponding regional average. ◦ Sub-Saharan Africa is lagging, but some countries like Cameroon, Congo, Kenya, Mali, Benin and Sierra Leone have achieved above average TFP growth rates in the 2000s, mostly attributable to policy changes (Yu and Nin-Pratt, 2011). Source: SUSTAINABLE AGRICULTURAL PRODUCTIVITY GROWTH AND BRIDGING THE GAP FOR SMALL-FAMILY FARMS (Interagency Report to the Mexican G20 Presidency). With contributions by Bioversity, CGIAR Consortium, FAO, IFAD, IFPRI, IICA, OECD, UNCTAD, Coordination team of UN High Level Task
  12. 12. TRENDS Other studies, in particular those using partial factor productivity indicators such as land and labor productivity, give a more pessimistic global picture, in particular when Chinas performance is taken out of the calculation of the world average (Alston et al., 2010). In Latin America, China and many developed countries, labor productivity increased faster than land productivity, as labor was shed out of the sector. In contrast…in Asia land productivity dominated, and on the African continent land expansion was a main driver. Differences in agricultural sectors…productivity in some livestock sectors, in particular non-ruminants, is increasing fast, there are concerns about trends in crop productivity growth. The most popular indicator of land productivity is crop yield. Source: SUSTAINABLE AGRICULTURAL PRODUCTIVITY GROWTH AND BRIDGING THE GAP FOR SMALL-FAMILY FARMS (Interagency Report to the Mexican G20 Presidency). With contributions by Bioversity, CGIAR Consortium, FAO, IFAD, IFPRI, IICA, OECD, UNCTAD, Coordination team of UN High Level Task Force on the Food Security Crisis, WFP, World Bank,
  13. 13. TRENDS The average global rates of growth in yield of most of the major cereals are declining. Since the 1980s, growth in wheat and rice yields fell from 2.5-3% to around 1%. Maize yields showed growth of slightly less than 2% over the last decade. Source: SUSTAINABLE AGRICULTURAL PRODUCTIVITY GROWTH AND BRIDGING THE GAP FOR SMALL-FAMILY FARMS (Interagency Report to the Mexican G20 Presidency). With contributions by Bioversity, CGIAR Consortium, FAO, IFAD, IFPRI, IICA, OECD, UNCTAD, Coordination team of UN High Level Task
  14. 14. LOOKING AHEAD SUSTAINABILITY (Environmental, Economic, Social)…Efforts to increase food production will take place within an environment characterized by a scarcity of natural resources. ◦ In many regions, there is little room for expansion of arable land, with virtually no additional land available in South Asia, the Near East and North Africa. ◦ Where land is available, in sub-Saharan Africa and Latin America, more than 70% suffers from soil and terrain constraints (FAO, 2011a).4 ◦ Unsustainable land use practices, such as overuse, poor land management and nutrient mining, result in global net losses of land productivity of an average 0.2% per year (Nelleman et al., 2009). ◦ Land degradation makes the top soil vulnerable to water and wind erosion and reduces the productivity of inputs such as fertiliser and irrigation, which in turn leads to production and income losses. At the global level, agriculture is the largest water user worldwide, representing about 70% of total withdrawal. ◦ In some countries, over 90% is withdrawn for agricultural purposes. Cities and industries are competing intensely with agriculture for the use of water and an increasing number of countries, or regions within countries, are reaching alarming levels of water stress and pollution. Global freshwater resources will be further strained in the future in many regions, with over 40% of the world„s population projected to be living in river basins experiencing severe water stress by 2050 (OECD, 2012a). Source: SUSTAINABLE AGRICULTURAL PRODUCTIVITY GROWTH AND BRIDGING THE GAP FOR SMALL-FAMILY FARMS (Interagency Report to the Mexican G20 Presidency). With contributions by Bioversity, CGIAR Consortium, FAO, IFAD, IFPRI, IICA, OECD, UNCTAD, Coordination team of UN High Level Task
  15. 15. LOOKING AHEAD WATER MANAGEMENT…Agriculture is also a major source of water pollution, from nutrients, pesticides, soils and other contaminants, leading to significant social, economic and environmental costs. Biodiversity underpins agriculture and food security through the provision of genetic material needed for crop and livestock breeding. INNOVATION + WATER USE EFFICIENCY: Maintenance of biodiversity is crucial for sustainability and resilience of farming systems as it builds the capacity to absorb shocks and continue to function within a changing set of circumstances. The challenge is to maximize agriculture„s positive contributions to biodiversity while minimizing its negative impacts. AG INNOVATION + BUNDLING + DIVISIBILITY: ◦ The productivity of farms can be improved through economies of scale and the adoption of more technically-efficient production systems. However, long-run productivity growth for the sector as a whole requires continuous technological progress, as well as social innovations and new business models. ◦ For agriculture to respond to future challenges, innovation will not only need to improve the efficiency with which inputs are turned into outputs, but also conserve scarce natural resources and reduce waste (OECD, 2011a). Source: SUSTAINABLE AGRICULTURAL PRODUCTIVITY GROWTH AND BRIDGING THE GAP FOR SMALL-FAMILY FARMS (Interagency Report to the Mexican G20 Presidency). With contributions by Bioversity, CGIAR Consortium, FAO, IFAD, IFPRI, IICA, OECD, UNCTAD, Coordination team of UN High Level Task
  16. 16. LOOKING AHEAD TOTAL ROI from R&D: Estimates of the rates of return to agricultural R&D suggest a very high social value of agricultural R&D. ◦ Annual internal rates of return of investments on agricultural R&D estimated in the literature range between 20% and 80% (Alston, 2010). ◦ In developing countries, the dollar-for-dollar impact of R&D investments on the value of agricultural production is generally within the range of 6% to 12% across countries (Fan et al., 2008, Fan and Zhang, 2008, FAO, 2012a). ◦ Countries which have heavily invested in R&D while simultaneously investing in extension have had the strongest productivity growth (Fuglie, 2012). Driven by policy incentives, recent productivity improvements in developed countries have occurred with lower levels of variable input use, and thus more sustainably…reflecting the clearer channels of communication consumer demand, industry, and policy makers. In contrast, in developing countries…Innovation systems for more sustainable use of resources, such as no-till farming, insect-resistant crops, more efficient irrigation, water management systems, sensors for nutrient status in crops, remote sensing and Geographic Information Systems (GIS) to improve and monitor land use and SMS messaging for enhancing advisory services to farmers, have been piloted….but scalable, widespread adoption is critical challenge. Source: SUSTAINABLE AGRICULTURAL PRODUCTIVITY GROWTH AND BRIDGING THE GAP FOR SMALL-FAMILY FARMS (Interagency Report to the Mexican G20 Presidency). With contributions by Bioversity, CGIAR Consortium, FAO, IFAD, IFPRI, IICA, OECD, UNCTAD, Coordination team of UN High Level Task
  17. 17. INSURANCE INDUSTRY Key driver of the U.S. economy. Stimulate trillions of dollars in private investment and influence business activity and building development patterns Insurance is woven into virtually every economic activity for consumers, taxpayers and governments that are reliant on stable and sound private insurance markets. Availability and stability are pivotal to consumer and government financial well-being. Great need and opportunity for insurers to play an expanded role in managing climate risks and bolstering society‟s resiliency to severe weather. https://www.ceres.org/resource s/reports/stormy-future/view http://www.ctnow.com/media/acrobat/2012-01/67158951.pdf
  18. 18. INSURANCE INDUSTRY In coastal and non-coastal areas alike, U.S. insured losses triggered by volatile weather events are steeply rising. Extreme weather events cost U.S. property/casualty insurers more than $32 billion in losses in 2011. https://www.ceres.org/resource s/reports/stormy-future/view http://www.ctnow.com/media/acrobat/2012-01/67158951.pdf
  19. 19. INSURANCE INDUSTRY Given that weather peril losses have been trending upward for years, due to a combination of higher concentrations of property in vulnerable areas and increasingly more severe and frequent extreme weather events, there is strong reason to believe that 2011 and 2012 are not anomalies. Consider these trends:✔ ◦ ◦ Losses from excessive precipitation during 2008- 2011 were the highest on record. Average annual winter storm losses have nearly doubled since the 1980s. ◦ Since 1980, wildfires burned the highest amount of acreage in 2005, 2006 and 2007; and in 2010, wildfires caused over $1 billion in damage (and in 2012 record setting wildfires occurred in Colorado and other parts of the West.); and✔ ◦ Losses from low precipitation (drought) during 2012 will be the highest since 1988.12 https://www.ceres.org/resource s/reports/stormy-future/view http://www.ctnow.com/media/acrobat/2012-01/67158951.pdf
  20. 20. BUSINESS STRATEGY + OPERATIONS In the past…multinationals‟ global operations consistently underperform their domestic operations. Why? These companies‟ strategies focus mostly on similarities across their markets: whenever possible, global companies standardize their business models to achieve economies of scale. They view regional difference as obstacles to be overcome – not opportunities to be leveraged. This perspective blinds firms to a contrasting strategy: ◦ arbitrage, the exploitation of difference (in culture, administrative practices, geographic distance, and labor or capital costs) across markets. ◦ Top notch companies seize advantage of such differences while also leveraging similarities that create scale Source: “The Forgotten Strategy” by Pankaj Ghemawat; HBR – Nov2003.
  21. 21. Business Expansion andOrganizationalDevelopment “The Forgotten Strategy” by Pankaj Ghemawat; HBR – Nov2003
  22. 22. • 6 billion mobile/cell phone subscribers in the world • Growth is led by China + India (30+ percent of world subscriptions) WORLD POPULATION Android is now the top smartphone operating system  with a user base increasing by 700,000 subscribers daily #1 HANDSETMANUFACTURER Leading smartphone hardware vendor http://www.digitalbuzzblog.com/infographic- 2012-mobile-growth-statistics/
  23. 23. AFRICA has about 644 Mn subscribers (about 11%)  LTE deployments are quickly gaining momentum (11 Cell / Mobile Phone Penetration million customers predicted by 2015)  Smartphone penetration rates are now at a whopping 17 to 19 percent (that‟s almost 1 in 5!)  The rest are split between either “feature” phones or basic “dumb” phones (albeit with SMS capability)  Commerce in Africa is dependant on mobile. Micro- entrepreneurship covers some 90 percent of the employment base and about 65 percent of the continental GDP  There are currently 5 major international cables in place providing bandwidth to the African continent  Despite the global recession and one of the lowest per-capita income levels in the world, BRICS counties and others are investing in Africa ahead of other marketshttp://www.mikekujawski.ca/2012/05/30/finally-some-2012-statistics-for-the-african-mobile-phone-market/ Source: Industry sources; Blycroft estimates; c. Blycroft 2012.
  24. 24.  Challenges or Opportunities? ◦ Climate Change ◦ Agricultural Productivity ◦ Enterprise Risk Management Sustainability + Joint Product Economics Policy, Innovation, Investment ◦ Regional Markets Transformation + Resilience
  25. 25.  "People, planet and profit" succinctly describes the triple bottom lines and the intention of sustainability. Joint products are two or more products manufactured simultaneously through the same process. ◦ Joint costs = common/shared manufacturing costs ◦ Each product has a significant market value.
  26. 26.  Managers of joint products processes must manage risk in two output markets. The challenge is to structure the firm to maximize profits in both markets. Policy tools that have been employed to support agriculture-based growth include: ◦ Marketing policy ◦ Trade policy ◦ Fixed Capital Investment policy ◦ R&D investment policy
  27. 27.  Managers of joint products processes must manage risk in two output markets. The challenge is to structure the firm to maximize profits in both markets. Policy tools that have been employed to support agriculture-based growth include: ◦ Marketing policy ◦ Trade policy ◦ Fixed Capital Investment policy ◦ R&D investment policy Growth in Brazil‟s Soybean Processing Industry and Government Policies, 1970-93; page 80; J. Cacho dissertation.
  28. 28.  A key policy tool in the transformation of Brazil‟s soybean industry was: ◦ Fiscal policy Tiered tax policy indicated a preference for poultry exports, over soybean grain exports.
  29. 29.  Joint product economics, combined with uncertainty and investment theory, may point to policy directions that support internalizing the environment cost and productivity increasing value of technology innovations. Such as: ◦ Tax incentive for firms with drip irrigation AND pivot irrigation products AND who invest in cell phone based agronomic advice (extension) ◦ Tax incentive for firms with actuarial models that address increased flood and/or drought events Macroeconomic stability is a critical assumption.
  30. 30.  Challenges or Opportunities? ◦ Climate Change ◦ Agricultural Productivity ◦ Enterprise Risk Management Sustainability + Joint Product Economics Policy, Innovation, Investment ◦ Regional Markets Adoption for Transformation + Resilience
  31. 31.  Fiscal policy: a tool to… ◦ Communicate market priorities to R&D and Marketing departments in the private and public sectors ◦ Target smallholder farmers / farmer associations ◦ Strengthen investment in businesses locally and internationally ◦ Encourage investment in value-chain building enterprises ◦ Catalyze demand for innovations that bundle responses to environment, social and productivity risks in a single market; and ◦ Rationalize the scarce resource of personnel in government investment bureaus.
  32. 32.  Economic integration is the unification of economic policies between different states through the partial or full abolition of tariff and non-tariff restrictions on trade taking place among them prior to their integration. The increase of trade between member states of economic unions is meant to lead to higher productivity  global scale development of economic integration, a phenomenon now realized in continental economic blocks such as ASEAN, NAFTA, SACN, the European Union. The Regional Economic Communities (RECs) in Africa group together individual countries in subregions for the purposes of achieving greater economic integration.
  33. 33. http://en.wikipedia.org/wiki/File:Economic_integration_stages_(World).png; Updated 12 January
  34. 34. The Ogallala Aquifer, part of the High PlainsAquifer System, is a vast yet shallowunderground water table aquifer locatedbeneath the Great Plains in the United States The Mekong River (known in Tibet as Dza- chu, China as Lancang Jiang and Thailand as Mae Nam Khong), is a major river in southeastern Asia.
  35. 35. THE TRUE SIZE OF AFRICA REC pillars African Economic Communityhttp://flowingdata.com/2010/10/18/true-size-of- africa/ http://en.wikipedia.org/wiki/African_Economic_Community
  36. 36. Active REC pillarsAfrican Economic Community http://en.wikipedia.org/wiki/African_Economic_Community
  37. 37. Africa‟s rivers and lake basins cross many borders http://new.uneca.org/Portals/15/CrossArticle/1/Doc uments/Transboundary_dec2002.pdf Information re AFRICA TRANSBOUNDARY WATER COMMISSIONS: http://www.transboundarywaters.orst.edu/research/RBO/RBO_Afric
  38. 38.  Challenges or Opportunities? ◦ Climate Change ◦ Agricultural Productivity ◦ Enterprise Risk Management Sustainability + Joint Product Economics Policy, Innovation, Investment ◦ Regional Markets Adoption for Transformation + Resilience
  39. 39.  Systematic, broad-based, adoption of bundled technologies will be pivotal to agricultural productivity growth at a pace to satisfy demand by consumers and minimum nutrition needs of an increasing world population. Several factors, including the weight of water, are driving the focus on increasing food production closer to consumers. Focus on SUSTAINABILE WATER UTILIZATION FOR FOOD can slow down the drive to convert forest into agricultural land, which has implications for conserving wildlife habitat.
  40. 40.  Fiscal policy – an innovative policy tool for adoption of technologies that respond to the multi-faceted demands of our future world. Additional research opportunities: WATER MANAGEMENT + INDUSTRIALIZATION WATER MANAGEMENT + FARMER ASSOCIATIONS ORGANIZATIONAL DEVELOPMENT ◦ The finance function in a multinational company presents new opportunities, and challenges, for Chief Financial Officers. ◦ Historically the finance function has focused on cost control, operating budgets and internal auditing.
  41. 41. INSURANCE PRODUCT DESIGN ◦ What is required to make the insurance industry reflect the acknowledged impacts from Climate Change? TELECOMMUNICATIONS APPS + KNOWLEDGE ◦ How can the mobile/cell phone platform be harnessed for improved water management? ◦ What are the implications of telecoms policy for stabilizing rural communities? Partnership with other research organizations, such as IFPRI, ACET, FARA; operational companies; farmer associations; and, financing enterprises is critical. Water accessibility/availability is one of the priority concerns for the future of our planet  increasing demand for policy research.
  42. 42.  Multi-disciplinary approach, presents the increased likelihood of: ◦ Bringing „inclusiveness‟ to defining water rights (group and individual); and, ◦ Stimulating demand for Science, Technology, Engineering, and Mathematics (STEM) education.
  43. 43. Paldies σας ευχαριστώ Merci Obrigado 谢谢 mulţumescБлагодаря ви Gracias Asante sana cảm ơn lắm
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