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Long-term scenario building for food and agriculture: A global overall model for FAO

  1. Long-term scenario building for food and agriculture: A global overall model for FAO Kostas Stamoulis ad-interim ADG, ES Department 19/02/2016
  2. GPS work and outputs Corporate reports on key issues • E.g. report on “Achieving Zero Hunger - The critical role of investments in social protection and agriculture” (2015) World Agriculture towards 20XX • long-term projections of agriculture, food security and natural resource use. Last baseline projection until 2050 (Alexandratos and Bruinsma, 2012) Frequent requests for selected findings from GPS reports by colleagues at HQ and decentralized offices, national and international organizations, and member states Global perspective studies (GPS) has a long tradition at FAO. Selected outputs comprise:
  3. Importance of FAO GPS findings GPS findings are important strategic corporate outputs as they: • Provide a reference framework to member countries for their long term development strategies for FNS and agriculture • Nurture the global policy debate about long term sustainability of food and agriculture; • Frame within a long term perspective and inform the next FAO’s strategic objectives; • Highlight possible futures of food and agriculture, vis-à-vis climate change scenarios. • Explore possible futures of access to food, in relation to structural changes of the agricultural sector, the role of smallholders, changing income distribution, capital ownership, human capital etc.
  4. Work ahead for GPS Given the strategic importance of GPS findings, FAO needs to update and upgrade its comprehensive long term forward looking exercise. Indeed, FAO is preparing the next long term forward looking report: “Food and Agriculture towards 2050-80” (FAT2080) To this end, FAO needs to: • Overhaul existing analytical tools for long term projections, to further improve their performance • Endow the GPS team with additional analytical tools to cover relevant domains not covered so far and better addressing current and emerging issues. This workshop is an important step in the process of preparing the next FAO forward looking exercise
  5. Reinforcing the analytical framework Alternative futures of FSN and sustainable agriculture depend on a set of interrelated variables determined by economy-wide dynamics, structural changes of economic systems affecting income generation and distribution, use and remuneration of production factors, capital accumulation, asset ownership, knowledge generation and human capital, population dynamics, etc. To frame FSN and agriculture in the proper social, economic and environmental context a model capturing key economy-wide interrelationships is needed, as a complement to sector-specific models. This workshop aims at setting up the operational framework to endow FAO GPS with a long-term global economy-wide model
  6. GPS Cooperation and partnership The Global Perspectives Studies Team is responsible for and has the leadership of FAO’s GPS work, but, the GPS fully relies on: • In-house knowledge and expert judgement. So, GPS is a coordinated effort involving the entire FAO; • Knowledge and experience of UN Rome-Based Agencies. RBAs according to their specificities, are most welcome to contribute and partner in this endeavor. • Contributions and partnerships with relevant institutions, including UN Agencies, the World Bank, OECD, IFPRI as well as further organizations and academic institutions. This workshop is a step in the direction of reinforced collaboration and future partnership. Many thanks to all of you, we value very much your inputs today
  7. Requirements for a global economy-wide model at FAO Rob Vos, ESA Director, 19/02/2016
  8. Major Topic: FSN in the Long Term FoodSecurityandNutrition Access Availability Utilization Stability Agricultural and food production, stock levels, trade Dimensions Components Levels and distribution of incomes and assets, expenditure, markets, prices Sufficient energy and nutrient intake by individuals, food preparation and storage Climatic conditions, resilient and sustainable production systems, economic factors Qualitative and Quantitative Analyses and Projections
  9. Implications for Analytical Tools Requirementsfortoolsandresults Tractable Consistent Replicable Open Building on in-house data and results, grounding in economic theory and agronomic expertise, replicable by other users Meeting informational demands of interested audiences, available to the public Sources of counter-intuitive results should be clearly identifiable and explainable Tools should be available in-house and releasable to interested users without restrictions. They should be usable in combination and individually, depending on exercise, and changeable by staff, and to the extent possible, by remote users Transparent Relevant Modular Accessible
  10. State of the Art I Multi-regional, multi-commodity partial equilibrium model • 110 regions • 42 agricultural activities (supply) which produce 35 commodities • 41 activities are modelled, 1 is used to derive “other” land demand • 32 commodities are derived from FAO-FBS • 3 commodities are used to close balances on calories • Modell allows for joint production (cotton) and multi-activity production (e.g. sugar beet & cane, vegetable oils, milk) Dynamic parameters calibrated to AT2030/50 report (Alexandratos & Bruinsma, 2012) and conditional on income/price/supply elasticities taken over from IMPACT v3.0 Global Agriculture Perspectives System (GAPS-PE)
  11. State of the Art II Multi-regional, multi-commodity general equilibrium model • Abridged recursive-dynamic multi-country version of IFPRI standard model • Build on GTAP 9 database augmented with SNA data • 14 Activities, distinguishing farming and food production, 1 household, number of regions depending on available data Used for testing of alternative specification for formal representations of agents and markets and data requirements Test version of a Global CGE Model
  12. What FAO-GPS has done so far and how? Global perspective studies (GPS) has a long tradition at FAO: • Since the 70s: “Indicative World Plan for Agricultural Development (1970)”. • Series of publications “World Agriculture towards 20XX”: long-term projections of agricultural, food security and natural resource use. • Multiple analyses of global trends and perspectives of agricultural investments, natural resources use (land, water), fertilizers use, and links to food security and nutrition. • In-house database development in collaboration FAOSTAT, specialized teams working on food security and natural resources (ES, NRL, NRC), etc. Future work should build on this
  13. Objectives of this Workshop 1. Discuss the nature of the scenario analysis to underpin FAO’s global perspectives work 2. Identify how the scenario analysis can be supported by a global model framework and what would be its desirable characteristics 3. Identify usable existing models (including GAPS) and what it would take to tailor these and combine to FAO’s needs 4. Define steps to operationalize the model-based scenario analysis 5. Discuss partnerships to make this happen (model development and application)
  14. Forward-looking scenarios: Key questions for the FAT 2080 exercise (and related modeling efforts) Lorenzo Giovanni Bellù Senior Economist FAO-GPS team leader 19/02/2016
  15. • World Agriculture towards 2030-2050 (AT 2050): Single long-term scenario reflecting a (most plausible?) future state of agriculture with a focus on use/availability of natural resources in different regions, built upon FAOSTAT food/commodity balance sheets, other data sources and expert judgement. • Representative Concentration Pathways (RCPs). On a parallel development the integrated assessment modelling teams produced detailed Representative Concentration Pathways (RCPs), which were used by climate modelling teams and were considered in the 5th Assessment Report of the Intergovernmental Panel of Climate Change (IPCC) • Shared Socio-economic Pathways (SSPs). Developed by IAM Consortium, SSPs are five narratives for alternative futures based on “reference assumptions” related to key socio economic variables (to replace the Special Report on Emission Scenarios (SRES) (see for example Krieger et al., 2012; van Vuuren et al., 2012). Augmented with climate policy dimensions (Shared Climate Policy Assumptions – SPAs) A comprehensive review is beyond the scope here, and will be the object of a next exercise, but we highlight selected works, as they help to “set the scene” for our modelling efforts. Scenarios for possible futures: who has done what
  16. Scenarios for possible futures (Cntd.) • OECD: Alternative Futures for Global Food and Agriculture (OECD alt.fut). von Lampe, M. (2015). Alternative Futures for Global Food and Agriculture: Developing Robust Strategies. TAD/TC/CA/WP(2015)1/FINAL, OECD. • OECD. Securing livelihoods for all. (OECD sec. liv.) Foresight for action, Development Centre Studies (2015). Not necessarily mutually exclusive • IFAD. Scenarios for investments in rural development. Proceedings from the workshop “Towards a high-Impact Demand-Driven research agenda” Dec. 1-3, 2015 • Agrimonde Terra foresight study. Focus on land • European Commission Foresight. Maggio, A., van Criekinge, T., Malingreau, J. P. (2015). Global Food Security 2030: Assessing trends with a view to guiding future EU policies. Foresight Series, JRC Science and Policy Reports, European Commission
  17. Scenarios for possible futures FAO AT2050 RCPs SSPs OECD alt.fut. OECD sec. liv. IFAD Agrimonde EC 2030 Single scenario, no climate change, constant agric. prices +2.6 W/mq peak (2060) CO2concentr. and decline to 400 PPM CO2 by 2100 SSP1: Sustainability: taking the green road Sustainability: (Greening, environmenta l and social focused “Automated North” (inequality increases, south slower) Low institutional capacity and high-growth pattern Land uses for food quality and healthy nutrition (RCP 2.6) Single scenario “Rosy vision” to 2030, to be realized + 4.5 W/mq Stabilization by 2100 at 570 PPM CO2 SSP2: Middle of the road (“moderate” of everything) Globalization: Economic growth focused Droughts and joblessness in the south (Migrations, inequality) High institutional capacity and high growth Land uses for regional food systems (RCP4.5) + 6.0 W/mq Stabilization beyond 2100 at 750 PPM CO2 SSP3: regional rivalry (resurgent nationalism). A rocky road Separate growth: Sovereignty and self sufficiency focused Global financial crash (protectionism, fragmentation, governments failure, inequa.) Moderate institutional developmen t with any growth uneven land uses driven by massive urbanization (RCP 8.5) + 8.5 W/mq Increasing CO2concentr. (1250 PPM at 20100 SSP4: Inequality across and within countries. A road divided Regenerative economies (sustainable energy, jobs, virtuous transf. Very low institutional capacity fragmented world and Land as commons for rural comm. SSP5: Fossil Fueled development. Taking the highway Creative societies. Technology Unemployment social experim.
  18. Basic elements for scenario building Demographics • Total population and age cohorts • Migration within and between countries Economic development • Global and regional GDP • Inequality between and within countries • Investment, savings and capital accumulation • Structure of sectoral income Environmental trends • Availability of natural resources and degree of degradation • Climate change, adaptation and mitigation • Sources of emissions Energy • Sources of energy (e.g fossil-based/renewables, nuclear, other) • Demand for energy and type of uses Technology • Rate of technological change and factor productivity • Emerging and new technologies Enabling environment • Institutions • Policies • Preferences Scenarios for FAT 2080: Not there yet, but key elements can already be identified…
  19. Key questions for FAT 2080 1. Population growth and migration Pressure on natural resources? Migrations? Urbanization? 2. Limits to natural resource uses FNS achievements in danger? Yield increases and/or land expansion? Land degradation? Water? 3. Investment for development and domestic asset generation Investment needs in rural areas? Public vs private? Foreign vs domestic? Investment for devt targets? Need for CSA/mitigation? Doubling smallh. Prod? 4. Income generation and distribution Within and across countries? Convergence? Dietary patterns? Asset accumulation? SME and/or SP? 5. Structural change Jobless development? Implications of Clim.Smart. Agriculture? Migrations? Job absorption by manuf? 6. Emerging global food value chains Which type of Glob. VC are good for FNS? Income distribution? 7. Climate change and development perspectives Impacts on yields and land? Mitigation where? CSA? Payments for envir services? 8. The Energy-Agriculture-Climate Change nexus Biofuels? CSA and energy requirements? Carbon taxes and food prices? Scenarios for FAT 2080: …and key questions can already be raised:
  20. The workshop • Agenda • Modalities • Rules: –focus on the workshop objectives –write down your main ideas and recommendations • Logistical announcements 20