IFAD’s programme priorities and Bioenergy Accra, Ghana, 18 October 2010 Dr. Rodney D. Cooke Director, Policy and Technical Advisory Division International Fund for Agricultural Development
IFAD at work From 1979 to 2009 : 829 projects in 115 countries Supported 300 million rural poor Total IFAD disbursement: over USD 12 billion USD 670.5 million in 33 new projects in 2009 USD 850 million forecast for 2010
Smallholder farming 500 million smallholder farms worldwide supporting around 2 billion people. They: Farm 80% of the farmland in Asia and Africa. Produce 80% of the food consumed in the developing world Feed 1/3 of the global population. Women are increasingly the farmers of the developing world, producing between 45% and 80% of household food.
Opportunities and Risks for Agriculture RISKS Environmental degradation - the need to make agriculture both productive and sustainable Climate change - the importance of adaptation & mitigation measures Increasing competition for scarce resources: land & water Slower growth of agriculture productivity in relation to growth of demand Food price volatility Aid fatigue & fiscal crisis Smallholders pushed aside by corporate farms Bio-fuels substitute for food OPPORTUNITIES Increasing demand for agricultural products Emergence of regional & global value chains Biotechnology-driven agricultural research changing technology options New markets for bio-fuels More resources for agriculture in short term (L’Aquila, GAFSP, EU) More commitment by governments, e.g. CAADP Globalised trade & private investment in agriculture Changing business models Payment for environmental services more widespread
The role of smallholders in closing the divide 500 million smallholder farms worldwide The challenge: to transform smallholder agriculture into successful agribusinesses
Options for rural smallholders Improve basic foods and staples I Integrate livestock to match rising demand Develop private Agro-processing & mktg Cash crops: a role for promising underutilised crops
Interventions in the agricultural sector: Energy An estimated 2 billion people lack access to modern energy services. They rely on traditional biomass sources such as wood, agricultural residues, and animal dung. Encourage local energy development to meet local energy needs which will reduce deforestation, provide cleaner burning fuel and provide the basis for intensifying agricultural production; Reduce the GHG emissions by promoting cleaner burning biofuels through smallholders farming following CA practices..
Nexus between poverty and energy Most poor people use biomass for energy. Environmentally unsustainable. Why are biofuels important for the rural poor?
Why are biofuels important for the rural poor? Almost 2.5 billion people in developing countries earn their livelihoods from agriculture. Of these, 900 million live below the poverty line. Agriculture directly employs 1.3 billion people. And, agriculture contributes only around 4% of global GDP. Small agricultural basket that cannot sustain that many.
Why are biofuels important for the rural poor? Expand the traditional agricultural basket (food, feed, fibre), by including biofuels. Selected bio-fuel crops offer this opportunity. Provided food security, environmental, land and water issues are addressed.
IFAD’s guidelines for in biofuel development IFAD’s Strategic Framework (2007-2010), recognizes the importance of biofuels as a major market opportunity for the poor. The Round Table discussion on biofuels in the GC 2008, led to the conclusions that participation in biofuels has to be: pro-poor, pro-nature, pro-livelihoods, pro-women, while ensuring food security.
Why is IFAD focussing on research? Existing knowledge on 1 st generation technology, but these are food crops. Capital investments on 2 nd and 3 rd generation technology, most of which are not suitable for the poor in developing countries. More research is needed on non-food biofuel crops to make them competitive.
Facility for non-food biofuel crop development Objectives coordinated research in a time-bound action plan along the entire value chain; finance local energy provision pilot projects to enhance food security; collect and disseminate information, research findings, and successful experiences; facilitate and strengthen R&D networking and knowledge sharing; and mainstream biofuel investment projects in partnership with the private sector.
Is low expenditure on agriculture justified? A 1% p.a. increase in agriculture growth, on average leads to a 2.7% increase in income of the lowest 3 income deciles in developing countries (WDR 2007) Agriculture is 2.5 to 3 times more effective in increasing income of the poor than is non-agriculture investment (WDR 2007) Agriculture growth, as opposed to growth in general, is typically found to be the primary source of poverty reduction (IFPRI, 2007) Agricultural growth the pre-cursor to overall economic growth: Europe and North America (in the early part of the 20 th century), in Japan a little later, and more recently in China, India, and Vietnam
Biofuels and water Intensive cultivation of monoculture cash crops causes environmental externalities associated with: Pesticides, fertilizers, high water use (which lead to water pollution and depleted resources). Small scale farming production has lesser environmental impacts. Why not promote smallholder biofuel crop production using CA techniques?
Conclusion Biofuels should be treated like any other cash crop. Impacts could be minimized by preferring crop varieties and farming techniques which cause low or positive impacts. A more balanced and a clear view on biofuels needs to be disseminated.
Biofuels and food security Available analysis indicated that in general bio-fuels are not a primary cause of hunger, nor a direct driver of food insecurity (GEF-STAP Workshop on Liquid Biofuels, 2006). Bio-energy crops could be a means to alleviate poverty, and to increase food security through income generation. Food security is not just a problem of production, rather a problem of unequal access within developing countries (FAO 2005). Supply of energy in rural areas is central to intensification of agriculture. This has become a pressing issue only because some countries have used food crops for biofuels production. Solution: Do not use food crops for bio-fuel production, or promote multiple use crops.
IFAD’s Development Objectives Strategic objectives: poor rural men and women in developing countries have better access to, and have developed the skills and organization to take advantage of: Natural resources ( land and water ); Improved agricultural technologies and effective production services; A broad range of financial services; Transparent and competitive agricultural input and produce markets; Opportunities for rural off-farm employment and enterprise development; and Local and national policy and programming processes .
Principles of Engagement Selectivity and focus IFAD won’t work outside rural areas; provide relief, GBS. Social services under specific conditions. Targeting Poor and vulnerable people: farmers, fishers, pastoralists, landless. Always women, sometimes IP, orphans. Great variation by country, not always absolute poorest. Empowering poor rural people Building skills, capacities, confidence; supporting their organizations – local and national .
Principles of Engagement (contd) Innovation, learning and upscaling IFAD’s role to innovate, and through experience promote upscaling by governments/donors Effective partnerships Local partnerships generally good, more partnerships needed with donors and international organizations Sustainability Need to improve sustainability of project impact – key factors achieving impact; local ownership and building skills of target group
Problematique: not enough lights in Africa Earth lights on