The old saying that “nothing is certain but death and taxes” is as accurate today as it was when Benjamin Franklin first wrote it in a letter to Jean Baptiste Leroy, a French physicist and writer, in 1789 at the age of 83. Franklin’s list, of course, is incomplete. To the list of death and taxes, you could add a number of things, such as, natural and manmade disasters. The age of electronics and global media coverage has brought a constant stream of disasters to the attention of readers and viewers. One of those inevitable disasters seems to be famine in North Korea [“Handling the Next North Korean Famine,” by Kay Seok, Wall Street Journal, 13 April 2010]. Seok, a North Korea researcher at Human Rights Watch, reports:
“Bad weather, compounded by the state’s economic mismanagement and ineffective collective farming methods, is causing a failure of the overall agriculture sector. Experts in the United Nations’ World Food Program are warning that this year North Koreans may face the worst food shortage since a famine claimed a million lives in the 1990s. Mid-April also happens to be when the so-called choongoong, or spring poverty, season begins. This is when North Korea runs out of the last bits of the previous year’s fall harvest but before summer crops can be harvested.”
I was going to write that you can’t do anything about the weather; but, that may be changing. A group of Swiss scientists recently claimed a breakthrough in laser-powered cloud seeding [“Swiss breakthrough could mean rain on demand,” by Paul Ridden, Gizmag, 4 May 2010]. Whether or not their efforts constitute a breakthrough remains to be seen. Even if you can’t change the weather, you can implement better policies and farming methods. Recently, Timothy Geithner, U.S. secretary of the Treasury, and Bill Gates, co-chair of the Bill & Melinda Gates Foundation, announced the launch of a new initiative to tackle global food security [“A New Initiative to Feed the World,” Wall Street Journal, 22 April 2010]. They wrote:
“As we work to build a stronger, more stable and balanced global economy, we must renew our commitment to tackle global hunger and poverty. Because a world where more than one billion people suffer from hunger is not a strong or stable world. A world where more than two billion people in rural areas struggle to secure a livelihood is not a balanced one. Today, the United States, Canada, Spain, South Korea and the Bill & Melinda Gates Foundation are making a commitment to fight the threat of global food insecurity. Together we are launching the Global Agriculture and Food Security Program, a new fund to help the world’s poorest farmers grow more food and earn more than they do now so they can lift themselves out of hunger and poverty.”
This is not the first venture that the Bill & Melinda Gates Foundation has supported in the area of food security. Back in 2006, the Gates Foundation teamed with the Rockefeller Foundation to tackle food security in Africa. For more information read my post entitled Gates & Rockefeller Foundations Tackle Food Security in Africa. Geithner and Gates continue their op-ed piece:
“A steep rise in food prices in 2008 and the recent global economic crisis have pushed the number of hungry people in the world to more than one billion. As the world’s population increases in the coming years and as changes in the climate create water shortages that destroy crops, the number of people without adequate access to food is likely to increase. As that happens, small farmers and people living in poverty will need the most help. They are the ones who cannot afford to grow crops or buy food when seed prices double. They are also the ones who face shortages when rainfall patterns change and reduce the amount of available water. We should not be facing this challenge today. In the 1960s and ’70s the world understood that agricultural development was an indispensable tool in alleviating hunger, reducing poverty, and driving economic growth. A combination of new, high-yielding crops developed by scientists such as Norman Borlaug and sustained investments from the U.S. and other countries helped save hundreds of millions of people from starvation in India, Mexico and elsewhere. Yet during the past three decades the world’s interest in agriculture waned. Donor nations moved on to focus on other issues. The result is that there has been a sharp drop in aid for agriculture. In 1979, nearly 18% of all official development assistance world-wide went to agriculture. In 2008, about 5% did. Private investment in agriculture in Africa is insignificant. Today, many Africans face food shortages in part because the average African farmer produces half the amount of crops per acre of an Indian farmer, one-fourth that of a Chinese farmer, and just one-fifth that of an American farmer.”
Part of the challenge has been that some developed countries have resisted the introduction of genetically-modified (GM) crops and their reluctance has caused concern among developing nations where such crops could accomplish a lot of good. As water scarcities grow, the development and harvesting of plants that can thrive on less water is likely to gain new appreciation even in areas that have been reluctant to allow GM crops in the past. The good news is that attitudes about GM crops may be turning. According to The Economist, a study released in February reports the GM “sector is blossoming, especially in the developing world, where poor and unproductive farmers have the most to gain from such advances [Taking root, 25 February 2010]. New approaches to irrigation are also likely to become increasingly important. Geithner and Gates continue:
“Proposed last year by the G-8 and G-20, the new Global Agriculture and Food Security Program hosted by the World Bank will provide financing to low-income countries with high levels of food insecurity. It will partner with countries that have developed sound agricultural plans and that are already using their own resources to invest in the most effective ways to boost crop production. The fund’s public-sector account will invest in infrastructure that will link farmers to markets, promote sustainable water-use management, and increase access to better seeds and technologies.”
To learn more about the Global Agriculture and Food Security Program, read my posts entitled Food Crisis and Recession and New Approach to Food Security Applauded. Geithner and Gates believe the new program is good but insufficient to meet the challenges that lie ahead. They continue:
“Aid alone cannot unleash the potential of agriculture. Small farms need greater private-sector investments than they get now. That is why this fund will have a private-sector account that provides financing to increase the commercial potential of small and medium size farms and other agribusinesses. Some poor countries are already taking steps to increase agriculture productivity. Rwanda, for example, has increased its investment in agriculture 30% from 2007 to 2009 and recently reported that its agricultural production was up 15% over that period. The fund will build on this and other progress that is underway. It will provide a transparent way for donors to implement their commitment to agriculture and a predictable source of funding for developing countries. And it will provide recipient countries and civil organizations, as well as donors, with a strong voice in determining where investments are made. … But creating this fund is only a first step. Last year, several wealthy nations pledged at least $22 billion over the next three years to agricultural development. Now they can join this fund to begin making good on their promises. Farmers and their families are in this for the long haul; we must be, too. Working together, we have an opportunity to create a world free of hunger and extreme poverty. Rural communities have waited too long for their farms to flourish. This time, as we return with renewed vigor and commitment to boosting agricultural development, let’s sustain our focus until the job is done. Let’s make history by learning from it.”
Back in October of last year, I ran a series of posts that detailed the agricultural challenges that must be faced in the coming decades. The challenges are long-term and, fortunately, the Gates Foundation has made a long-term commitment to meeting the challenge.
Attracting private investment into the agricultural sector is important, but it is investment in production, rather than in commodities, that is needed most. It seems, however, that it is the commodity side of agriculture that has really heated up [“Investors in rush to feed the world, by Javier Blas, Financial Times, 25 November 09]. The attraction of the agricultural sector for commodity investors is obvious. As Blas reports, all you have to do is look at “the compelling fundamentals – including years of underinvestment because of low prices in the 1990s and early 2000s, a structural increase in demand as the world’s population has risen and demanded a diet richer in meat, and the introduction of biofuels.” These fundamentals “have been enough to attract many investors. ‘If you are bullish on population growth, you have to be bullish on agriculture,’ says Will Shropshire, head of agricultural trading at JP Morgan in London.”
As nations whose economies are dependent on selling natural resources know too well, commodity prices are highly volatile and that volatility undermines stable economies. Geithner and Gates are hoping that the fund they announced will at least provide greater stability in the agricultural sector.
