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The future of food systems: Drivers and triggers for transformation
- 1. Strategic foresight for transforming agrifood systems Swedish International Agricultural Network Initiative (SIANI) Stockholm Environmental Institute (SEI) Virtual Presentation, 24 May 2023 Lorenzo Giovanni Bellù, Senior Economist, Lead Policy Intelligence Branch - Global Perspectives FAO UN – Rome The future of food and agriculture Drivers and triggers for transformation
- 2. The corporate strategic foresight process and follow-up This report illustrates the process and findings of the corporate strategic foresight exercise (CFSE). Here are the essential steps of the CSFE process (and follow up): Defining agrifood systems Identification of drivers Of agrifood systems Analysis of interactions among drivers Quantitative modelling of scenarios Narratives of future scenarios (snapshots and pathways) Triggers and/or accelerators for desired transformations Strategies and policy options for desired outcomes Backward steps (iterative processes) Sequential workflow Main steps Detection of “weak signals”
- 3. Mapping agrifood systems: drivers, activities and outcomes Socioeconomic systems’ drivers affect agrifood systems both on the demand and supply sides. Source: FAO. 2022. The future of food and agriculture – Drivers and triggers for transformation. Rome. Agrifood systems’ activities are influenced by selected drivers that largely depend on choices and behaviours of agents within the agrifood systems themselves. Environmental systems frame both agrifood and socioeconomic systems. Climate change, together with the other environmental drivers, influence all the drivers and are in turn influenced by them. Agrifood systems’ outcomes depend on complex relationships with socioeconomic and environmental systems and co-determine, via systemic linkages and feedback effects, the other systems.
- 4. Selected drivers and ‘weak signals’: Economic growth (Driver 2) Source: FAO UN, 2022. The future of food and agriculture – Drivers and triggers for transformation. Historical trend: Convergence between HICs and LMICS in terms of per capita income remains highly problematic’. ‘Weak signal’: Convergence between HICs and LMICS in terms of per capita income may not materialize at all in the next decades (but see China) GDP per capita at purchasing power parity by region (1990–2020)
- 5. Agrifood prices (driver 9) Source: FAO UN, 2022. The future of food and agriculture – Drivers and triggers for transformation. Agricultural producer price index: historical (1993–2018) and projected (2012–2050) Historical and projected trends: Real agricultural Producer prices have significantly increased in the last three decades. The historical trend fits long term projections that portray further price increases. ‘Weak signal’: Factors that generate prices increases may persist and compose with policies aimed at internalizing external costs. Possible futures with increasing food prices have to be considered.
- 6. Outcomes and ‘weak signals’: Food security and nutrition 0 5 10 15 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 Percentage Historical Business as usual Towards sustainability Stratified societies Base-year for projections Sources: Scenario projections are based on FAO, 2018: The future of food and agriculture - Alternative pathways to 2050. The base-year for projections is recalibrated as in FAO, IFAD, UNICEF, WFP and WHO, 2020: The state of food security and nutrition in the world. Historical data from 2000 to 2019 are drawn from FAO, IFAD, UNICEF, WFP and WHO, 2020: The state of food security and nutrition in the world. Historical data from 2020 to 2021 are drawn from FAO, IFAD, UNICEF, WFP and WHO, 2022: The state of food security and nutrition in the world. Prevalence of undernourishment: Historical (2000-21) and projected (2012-2050) Historical and projected trends: Some successes, signalled by nutrition indicators have been achieved but the PoU has increased in the last five years. After a decade of successes, and is moving along what was considered a ‘worst case’ scenario. ‘Weak signal’: Historical achievements are not resilient and easily reversible. Possible futures should comprise cases of increasing food insecurity due to lack of control over causes such as climate change, conflicts and inequalities.
- 7. FOFA DTT: Four alternative scenarios to 2030, 2050 and beyond More of the same (MOS). Muddling through reactions to events and crises, while doing just enough to avoid systemic collapses, led to degradation of agrifood systems sustainability and to poor living conditions for a large number of people, thus increasing the long-run likelihood of systemic failures. Adjusted future (AFU). Some moves towards sustainable agrifood systems were triggered in an attempt to achieve Agenda 2030 goals. Some improvements in terms of well-being were obtained, but the lack of overall sustainability and systemic resilience hampered their maintenance in the long run. Race to the bottom (RAB). Gravely ill-incentivized decisions led the world to the worst version of itself after the collapse of substantial parts of socioeconomic, environmental and agrifood systems with costly and almost irreversible consequences for a very large number of people and ecosystems. Trading off for sustainability (TOS). Awareness, education, social commitment, sense of responsibility and participation triggered new power relationships, and shifted the development paradigm in most countries. Short-term Gross domestic product (GDP) growth and final consumption were traded off for inclusiveness, resilience and sustainability of agrifood, socioeconomic and environmental systems.
- 8. Scenarios and triggers for transformation Governance Consumer (citizen) awareness Income and wealth Distribution Innovative technologies No governance of global Issues. Roles of public and private confused Piecemeal approaches of few groups have limited or no impacts on transformation Inequalities, hunger, extreme poverty not tackled. HIC and LIC diverge. Within the current paradigm (large- scale, labour-saving) CC 2100: 3+ Selective pursuit of Agenda 2030. Private bodies cover public functions Segmented pressure groups focus on well- being of selected societal layers/LICs Voluntarist actions to combat most striking situations. Weak fiscal systems. Mostly within the current paradigm. Small-scale survives CC 2100: 3- Short-termism, dismantlement of rules. Governments colluded with elites Green-social washing fools consumers. Citizens irrelevant in all systems ‘Stratified societies’. Exacerbated poverty in HICs and LMICs. No taxes no services Extractive economies based on exhaustible resources dominate. CC 2100: 4+ Global governance of global phenomena. Power distributed. Roles well defined. Consumers give up final consumption to invest to transform. HICs give room LICs Different metrics for wellbeing. Less leakages from LICs. Efficient fiscal system ‘Circular’ economies based on renewable resources dominate. CC 2100: 2-
- 9. Overarching message of the FAO flagship report FOFA –DTT It is still possible to avoid the collapse of agrifood, socio-economic and environmental systems, provided that short-term unsustainable achievements be traded off for longer-term sustainability and resilience. Indeed, sustainable and resilient development does not run along a ‘toll-free motorway’: wealthier countries and social groups that can afford the inevitable costs of transformation should bear them to support to those already affected by the negative impacts of unsustainable development. In this endeavor, “…my mind is pessimistic, but my will is optimistic. Whatever the situation, I imagine the worst that could happen in order to summon up all my reserves and will power to overcome every obstacle.” (Antonio Gramsci, Italian philosopher, 1927). Overall, pessimism is a luxury that we cannot afford.
- 10. The future of food and agriculture: stay tuned Drivers and triggers for transformation https://doi.org/10.4060/cc0959en Dashboard www.fao.org/global-perspectives-studies/fofa-dtt- dashboard FOFA series www.fao.org/global-perspectives-studies/fofa
Editor's Notes
- This report fits within a long lasting corporate tradition of carrying out forward-looking studies in support to corporate strategic planning activities and to the service of the development community at large. It is the fourth issue in the corporate series “The future of food and agriculture”. The number 0, Achieving zero hunger, preliminary to the formal set-up of the series, served to set up FAO’s position at the Conference on Financing for Development, In Addis Ababa in 2015. The second report Trends and challenges, constituted the conceptual backbone of the FAO Medium Term Plan in 2017. The third one, Alternative pathways to 2050, for the first time at FAO provided alternative scenarios for agrifood systems and related quantitative projections. This FOFA report has been developed in close synergy with the preparation of the FAO Strategic Framework 2022-2031, thanks to a Corporate Strategic Foresight Exercise Between 2020 and 2022 FAO implemented a structured foresight exercise at corporate level involving almost all divisions and decentralizzed offices. Key components comprise: IEC, SSS, EEC, Technical papers. Multiple exchanges and contributions at different stages occurred with the process of formulating the FAO Strategic Framework. Key questions at the basis of the Corporate Strategic Foresight exercise Looking ahead, the core question is: can we meet the needs of a sharply increasing global population while the pressures on scarce land and water increases and the negative impacts of climate change intensify? This raises further questions. Can agriculture ensure that the use of the natural resource base is sustainable? Can agriculture contain greenhouse gas emissions and mitigate the impacts of climate change? Can the world secure access to adequate and nutritious food for all, especially in the low-income regions where population growth is the most rapid and where still stunting (low height for age), wasting (low weight for height) and other forma of malnutrition affect children and adults? Can economies be transformed in ways that provide more and better employment and income-earning opportunities, especially for youth and women, and help stem mass urbanization and migrations? Can the impacts of conflicts and natural disasters, both major disrupters of food security and the causes of vast migrations of people, be contained and prevented? Can we overcome ‘wickedness’ in policy-making, where often the response to one aspect of a problem (e.g. incentives to raise productivity) risks exacerbating others (e.g. depletion of natural resources)? Can we engage all stakeholders, in better decision-making, through more inclusive governance? There is mostly unanimous consensus about the fact that that major transformations of agricultural systems, rural economies and natural resource management will be needed if we have to realize the full potential of food and agriculture to ensure a sustainable, secure and healthy future for all people, as reflected by Global Corporate Goals and Agenda 2030 in general.
- Notes: Core activities of agrifood systems (production, processing, retailing etc.), which are interlinked through flows of goods and services (items in the white box at the centre), occur within broader socioeconomic and environmental systems (light blue and dark blue boxes). Socioeconomic and environmental drivers, as well as selected drivers determined within the agrifood systems themselves, (labels on the lefthand side of the figure), influence the state and dynamics of agrifood systems and their socioeconomic and environmental outcomes (labels on the right-hand side of the figure). Triggers of change (top of the figure) affect agrifood systems and their outcomes through their impacts on selected environmental, socioeconomic and agrifood drivers (labels on the left of the figure in the first, second and third columns, respectively). The different colours of drivers reflect their relationship with the trigger affecting them. The trigger designated "Institutions and governance’" affects all drivers and directly impinges on the functioning of the whole agrifood system and its relationships with the other systems. Given the systemic relationships among drivers, core activities of agrifood systems and their outcomes, the various triggers may concurrently affect different drivers, while each driver can be also affected by different triggers of change. The overall graph, core activities and outcomes were adapted from the Foresight4Food website (www.foresight4food.net/category/blog)
- Some drivers had already been identified and analysed in previous FOFA works. In this report, their analyses have been updated/upgraded: this concerns for instance drivers such as Population, climate change economic growth, poverty and inequalities, for instance. Understanding how the different drivers interact to influence agrifood systems’ activities and their performance implied massive cross- and inter-disciplinary work. Chapter 1 of the report zooms on such analyses. The analyses of trends of key variables and indicators allowed detecting “weak signals” of possible futures, that is events and occurrences already observable that may magnify and deepen enough to determine future patterns of agrifood systems. In many instances, historical trends have been compared with projections found in literature and in previous FAO’s works. Although the scenarios in this report are depicted in qualitative terms, massive quantitative data have been used. To make the report FOFA - Drivers and triggers of transformation, a live product, the data analysed are shared are available through a web-based data dashboard, that allows to replicate the figures of the report and much more:
- Economic growth in the last 30 years. Significant in some regions and countries (including India and China). However, per capita income (PPP) barely increasing in LAC and Near East and North Africa, stagnant if not decreasing in SSA. Due to the significant per capita growth in HIC, convergence may remain a dream for quite some time.
- Savings and investment. The potential of saving is very unequally distributed. While the share of savings of GDP in some LMIC regions exceeds HICS’ one, savings per capita in HICs are ten times or even more those in most LMIC regions. This gives an idea on where substantial research and development is going to occur and who is likely to get the ownership of capital assets in the next decades.
- Policies aimed at achieving he ‘true cost’ of food may increasingly be implemented. See the table with trade-offs. Other forces however may materialize that contain such increases.
- Note the peculiarities of LAC, NNA and above all SSA, compared with China and SAS
- Commodity dependence, both from the export and the import side, renders a country’s socioeconomic system more vulnerable, less resilient to shocks and more prone to hunger and malnutrition. SOFI 2019 states that “eighty percent of the countries (52 out of 65) with a rise in hunger during recent economic slowdowns and downturns are countries whose economies are highly dependent on primary commodities for export and/or import”. The implications of commodity dependence on development had been highlighted already in the 1950s, “[…] the import of capital into underdeveloped countries diverted the underdeveloped countries into types of activity offering less scope for technical progress” (Singer, 1950). What is certain is that the option to adopt a strategic behaviour towards the achievement of national objectives by using a mix of policies, comprising selective openings for essentials and capital goods associated with protective measures in sensitive areas (e.g. infant industry, minimum food stocks, etc.), was already foretold at that time. In this light: “[…] the purposes of foreign investment and foreign trade ought perhaps to be redefined as producing gradual changes in the structure of comparative advantages and of the comparative endowment of the different countries rather than to develop a world trading system based on existing comparative advantages and existing distribution of endowments […] Perhaps the most important measure required in this field is the reinvestment of profits in the underdeveloped countries themselves, or else the absorption of profits by fiscal measures and their utilization for the finance of economic development” (Singer, 1950,).
- The Corporate Strategic Foresight Exercise, which created the ground for the FOFA-DTT report, identified key families of “triggers for transformation” to be considered in this process. They are effective starting points or boosters (depending on the context) for transformative processes to move away from “more of the same” types of future. These families of triggers include: Significantly reinforcing Institutions and governance. It is clear that there is a mismatch between issues at stake and capacities to govern them. Climate change issues is just an evident example, another is international conflicts, but also international migrations (and, if income gaps persist, what we have seen so far is just the top of the iceberg), trade, pandemics, illicit financial flows (SDG 16.4). The UN could have a great role to play, only if influential Members had the political will to reinforce global institutions. Consumer awareness; Demand-side policies. Aware and conscious consumers can largely contribute to reducing the pressure through shifting diets away from resource intensive and/or socially inequitable foods, specifically in HICS and selected upper-middle income countries. This may have a global transformative impact. Income and wealth distribution; food prices have been increasing since the new millennium and are possibly further increasing if social and environmental externalities are going to be internalized. Keeping prices artificially low is a no go. Inefficiencies, overuse of resources etc. Access to food has to be granted via better income distribution (fiscal systems, access to resources, health-care services etc.) Innovative technologies and approaches. We still has to learn how to produce more with less, including how to transition away from fossil fuels. There are attempts that may reveal possible futures but much more needs to be done, also in view of increasing population. These triggers are activated to a different extent (or not activated at all) under alternative scenarios: MOS More international trade, more foreign investment, more technology transfer, LMICs keep attempting to ‘catch up’ and close the productivity gap. CC2100 3+ No changes in governance in rules and institutional set up; AFU More of the same but also better income distribution focus on well-being in the short-medium term. Little R&D in tech for circular economy, limited overhauling of physical capital and increase in human capital. CC2100 3- RAB Short-termism, exacerbated inequalities, extractive economies. Green and social washing, fooled consumers. Little R&D in circular economy, limited overhauling of physical capital and increase in human capital. No global governance of global issues. TOS Transformative with costs These triggers, to be further articulated at various levels, complemented and made context-specific, are expected to influence important drivers of agrifood systems and, through multiple systemic linkages and feedback effects, to spread their impacts throughout the socioeconomic and environmental systems for achieving the desired agrifood systems outcomes. Given their potentially high transformative impacts, activating these triggers in the complex multilateral arena can be politically sensitive, because their effective activation may imply impinging on consolidated power relationships not only within countries but, even more, across countries, including between HICS and LMICS.
- The “four betters” are paired to allow for visualization under some assumptions. Better nutrition is assumed to be a dimension of better life and to be positively correlated with it if the other dimensions are kept constant. Better production is assumed to be an important contributor to better environment and to be positively correlated with it if other factors affecting the environmental quality are kept constant. Note that the “end-states” of the scenarios in the space of the “four betters” are placed for illustrative purposes, just to portray the relative position of each scenario with respect to the others. More of the same (MOS). Progressive degradation of the four betters. Substantial collapses possible. Adjusted future (AFU). Some moves towards better nutrition-better life were triggered in an attempt to achieve Agenda 2030 goals and some improvements in terms of well-being were obtained, but the lack of overall sustainability and systemic resilience hampered their maintenance in the long run due to worsening production processes and degrading environment. Trade-offs addressed with short termistic approaches. Race to the bottom (RAB). Neither betters related to nutrition and life nor production and environment are achieved. after the collapse of substantial parts of socioeconomic, environmental and agrifood systems with costly and almost irreversible consequences for a very large number of people and ecosystems. Trading off for sustainability (TOS). Awareness, education, social commitment, sense of responsibility and participation allowed for some suggess in the two betters most directly related to well-being. Gross domestic product (GDP) growth and/or consumption in the short and medium run was traded off for investment inclusiveness, resilience and sustainability of agrifood, socioeconomic and environmental systems, and/or short term consumption gave the pace to investment .
- Forward-looking (foresight) and investment are conceptually closely linked. In both cases we need to look at forces that currently determine the state and performances of agrifood systems. In other words, Identifying possible future patterns of aTgrifood systems and investing to transform them implies: 1) analyzing current and future patterns of each driver; 2) understand how all the different drivers interact to determine the state and current performances of agrifood systems (causal linkages i.e. cause-effect relationships); and 3) detect ‘weak signals’ of possible futures of agrifood systems; 4) Invest in actions that counteract negative signals and boost positive ones. Investing to “trigger triggers” of transformation may help to move agrifood systems towards sustainability and resilience.
- Trade-offs in policymaking. The position of each end-state, and the pattern followed to reach there, will both depend on the sets of strategies and policies presumed to be implemented under each of the scenarios. More specifically, the narratives are characterized by different ways in which strategies and policies will address emerging trade-offs along development patterns. Overall, trade-offs emerging along development patterns may not reflect contrasting objectives in absolute terms. Given the multiple cross-linkages among the various elements in agrifood systems, policy solutions may exist which reconcile apparently contrasting objectives. In the TOS scenario, for example, adopting sustainable agricultural practices that may imply lower yields in comparison to conventional agriculture, can concurrently lead to limited expansion of arable land if full-cost accounting for food prices (“True Cost of Food’) is adopted. This would imply higher food prices which would be likely to lead to a comparatively lower expansion of food demand and reduced pressure on land requirements.cd At the same time, food security in a context of higher food prices could be achieved if income and food distribution were improved by means of appropriate governance at all levels, fiscal policies and other policies aimed at increasing wages and income earning opportunities.
- Ultimately, a strategic foresight report has also to convey unfortunate, but plausible, scenarios such as a “more of the same” or even or worse. Win-win solutions are welcome, but they may not exist anymore or be less frequent than what we have thought until now.