Water, Food, Energy and Institutions: Inextricably Linked by Uma Lele


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Presentation made by Dr Uma Lele, Member of GWP Technical Committee, GWP Consulting Partners Meeting, August 2011, Stockholm, Sweden

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Water, Food, Energy and Institutions: Inextricably Linked by Uma Lele

  1. 1. Water, Food, Energy and Institutions: Inextricably Linked Uma Lele Keynote Address Consulting Partners Meeting Global Water Partnership, Stockholm August 18, 2011
  2. 2. Food Price Rise and Volatility? FAO Real Food Price Index (Annual) (1990-2011) ? 250 200 2002-2004=100 150 100 50 0 1990199119921993199419951996199719981999200020012002200320042005200620072008200920102011 Source: www.fao.org/worldfoodsituation/wfs-home/foodpricesindex/en/- Food Price Index
  3. 3. Trends in world hunger Undernourishment in 2010, by Region (mill.) Largest Number of the world’s hungry in South Asia
  4. 4. Under Five Malnourishment Challenge: South Asia and SSA off track Child malnutrition rates remain high in South Asia and 50 Sub-Saharan Africa 2000 2009 Proportion of children under age 5 40 underweight for age (%) 30 20 10 0 Source: United Nations Childrens Fund, World Heath Organization and WDI, World Bank
  5. 5. Progress on access to an improved Progress on access to improved water source sanitation
  6. 6. By 2050 World Would Need to Feed 9 Billion+ People FAO Projects: – Almost all population and income growth will arise in developing countries, particularly in Asia and SSA – Cereal Production (Net of Biofuels) would need to increase by 70% – Meat production by 220%, – Cereal Imports of Developing countries will increase by 220%
  7. 7. Will Food Supply Keep up With GrowingDemand?Sources of Demand are Well Increased Risk and UncertaintyUnderstood on the Supply Side•Population Growth: •Climate Change • All in LDCs •Limits to Land, Water, Soils, Biodiversity, Forests, Fisheries•Income Growth •Energy shortages and subsidies,•Mostly in LDCs •Last Frontiers? • Brazil, SSA?•Urbanization: •Increased Risks and Uncertainty • Up from 50% to 70% (from climates, global market•Shift in Food Preferences: integration) • Rice, Wheat, Maize, •Slowing Productivity Growth Soybeans for Feed: •Stagnant Investment levels in R and D•Biofuels: maize, oilseeds •Interlinked International Markets•Processed Foods
  8. 8. Agricultural productivity growth is slowing (source Fuglie 2011)Source: World Bank Development Report 2008 (figure refers to developing countries only)
  9. 9. Where Is Water for Food?72% of Irrigation in AsiaWHERE IS LAND?
  10. 10. Two Likely Future Scenarios of Growth in Food Production Area Expansion: and Intensification in SSA> three times the cerrados in Brazil?Further Intensification of AgricultureWill be required in Asia •80% to 90% of increase in production will have to come from agricultural intensification • Increased yields per ha • Changing cropping patters • Multiple cropping on unit of land
  11. 11. More Crop Per Drop?Regional Productivity Growth in Parts of China has been higher than anywhereelsewhere on a a scaled up basis”Top Ten Provinces The top ten provinces in TFP growth for the 1985-2007 period. Six of them are on the east coast 1 Jiangxi 8.17% 2 Guangdong* 8.11% 3 Hebei* 7.95% 4 Fujian* 7.89% 5 Shandong* 7.37% 6 Hubei 7.34% 7 Inner Mongolia 7.26% 8 Zhejiang* 7.19% 9 Sichuan 7.18% 10 Liaoning* 6.83% Wang, Tuan, Gale, Somwaru, and Hanson. AAEA 2011
  12. 12. DISTRIBUTION OF TFP GROWTH INDEXVALUES BY STATES IN INDIA: 1975-2005 JAMMU & KASHMIR HIMACHAL PRADESH PUNJAB UTTARANCHAL HARYANA ARUNACHAL PRADESH DELHI SIKKIM RAJASTHAN UTTAR PRADESH ASSAMNAGALAND MEGHALAYA BIHAR MANIPUR TRIPURA JHARKHAND MIZORAM GUJARAT MADHYA PRADESH WEST BENGAL CHHATTISGARH DADRA & NAGAR HAVELI ORISSA MAHARASHTRA ANDHRA PRADESH Note: (1999-2009) GOA KARNATAKA (Red circle) Agricultural Growth Rates > 4% PONDICHERRYPONDICHERRY KERALA TAMIL NADU (Black circle) Agricultural Growth Rates 2% to 4% (while circle) Agricultural Growth Rates <2 %TFP Growth Score Class N.A Below 60 [Low] 60.00 - 70.00 [Moderate] (Major State Average=70.1) 70.01 - 90.00 (High) Above 90 [Very High]Source: Based on Total Factor Productivity and Contribution of Research Investment to Agricultural Growth in India: Ramesh Chand et al. NCAP 2011
  13. 13. Improved Water Management in East and South East Asia andScope for Knowledge Transfers/ South – South Learning:China and Vietnam and South Asia 1. In China and Viet Nam, agriculture water withdrawal as a percentage of total national water withdrawal has declined from 92.5 and 88.2 in 1990 to 68.1 and 67.7 in 2000 (FAO) and to 60% according to latest data (Khalid Mohtadullah) 2. Incentivized Irrigation Bureaucrats in China have helped improved water management ( Tushaar Shah) 3. Successful innovations in Gujarat in India
  14. 14. Water Management Challenges in IndiaIrrigation Investment & Irrigated Area in India Source: Amerasinghe et al
  15. 15. Government Investment in Total AgResearch, On Soil and Water (incl. Education) in Agriculture by Sub-sectors in India: 1960- 1961 to 2007-08 (in million Rs at current prices)500004500040000350003000025000200001500010000 5000 0 1960-61 1962-63 1964-65 1966-67 1968-69 1970-71 1972-73 1974-75 1976-77 1978-79 1980-81 1982-83 1984-85 1986-87 1988-89 1990-91 1992-93 1994-95 1996-97 1998-99 2000-01 2002-03 2004-05 2006-07 Crops Livestocks Fisheries Soil and Water conservation Source: Total Factor Productivity and Contribution of Research Investment to Agricultural Growth in India: Ramesh Chand et al. NCAP 2011
  16. 16. China Stands out in Public Agricultural R and D Spending Relative to SSA, Brazil and India Source: ASTI as reported in Beintema and Stads (2011)
  17. 17. Average ag TFP growth, 1970-2006 (% per year) Former USSR Caribbean Developing Oceania Sub-Saharan Africa Average annual Circled regions show persistently TFP growth low TFP growth > 2% 1-2% < 1% Source: Keith Fuglie, Technology Capital, The Price of Admission to the Growth Club
  18. 18. Rainfed Agriculture Yields Are Converging Average Grain yields in Sub-Saharan Africa (37%) of Average Yields in Other RegionsSource: Food Security Assessment, 2010-20 / GFA-21; Economic Research Service/USDA
  19. 19. Source: Food Aid Flows Report 2009 by WFP and www.wfp.org/fais
  21. 21. Fragmented Aid Architecture Estimates of total aid (all sectors) in 2007 (Source: Kharas, 2009)Private sources (2007): 60 DAC-Bilateral (2007): 73….of which: ….of which: USA 37 USA 18.9 UK 4.1 Germany 7.9 France 1 France 6.2 Japan 5.8 (Source: Hudson Institute, Global UK 5.6 Index of Philanthropy, 2009) (Source: OECD DAC database) NON-DAC (2007): 10 ….of which: Multilateral (2007): 28 China 3 ….of which: Arab EC 11.3 countries 2.6 IDA 7.5 India 1 UN 3.5 Korea 0.8 Global Fund 1.6 (Source: Homi Kharas, 2009*)* Brookings Institute: Kharas, H., “Development Assistance in the 21st Century”, Contribution to the VIII Salamanca Forum, The (Source: OECD DAC database)Fight Against Hunger and Poverty, July 2009
  22. 22. Declining ODA to Agriculture (1979 – 2007)
  23. 23. External Investment in Irrigation and Drainage
  24. 24. Increased Opportunities for GWPDecline in Technical Capacity at the World Bank
  25. 25. Total Biennial Resources Available (1994-2007)Note: The above figure shows FAO’s regular program budget isfunded by its members, through contributions, adjusted to theEuro/US dollar exchange rate fixed by the FAO Conference. Thisbudget covers core technical work, cooperation and partnershipsincluding the Technical Cooperation Program, knowledge exchange,policy and advocacy, direction and administration, governance andsecurity.The FAO’s regular budget for the biennium 2010-2011 has beenincreased by 7.6% to US$ 1000.5 million from the biennium 2008–2009 US$ 929.8 million, adjusted to the Euro/US dollar exchangerate fixed by the FAO Conference. Member states froze FAOsbudget from 1994 through 2001 at US$650 million per biennium.The budget was raised slightly to US$651.8 million for 2002–03 andjumped to US$749 million for 2004–05, but this nominal increasewas seen as a decline in real terms. In November 2005, the FAOgoverning Conference voted for a two-year budget appropriation ofUS$765.7 million for 2006–2007; once again, the increase onlypartially offset rising costs due to inflation. Source: FAO: The Challenge of Renewal: Report of the Independent External Evaluation of the FAO: September This figure shows FAO’s biennial resources in terms of US K$ at 2007 (figure 7.1) 1994 constant prices.
  26. 26. Implications for GWP and Partners1. GWP’s mission is worthy2. But development challenges have become more complex3. Generating and disseminating Relevant Knowledge is a costly business4. It is easier to explain differences in performance among regions and countries than to explain why or how and transferability of experience.5. Donor resources have become limited and fragmented6. More are being made available through Trust Funds7. Donor expectations about demonstrating impact has increased8. But donor time horizon has become shorter9. Leadership, institutions, capacity and demand for knowledge in developing countries are key for success10.GWP needs to mobilize the best of technical expertise. Quality of relations, trust and confidence with developing countries will be critical necessary conditions.
  27. 27. THANK YOU!