Agric innovation, tech, key to poverty reduction in developing countries— World Bank report

A new World Bank (WB) report has said that developing countries need to dramatically increase agricultural innovation and the use of technology by farmers to eliminate poverty, meet the rising demand for food and cope with the adverse effects of climate change.

The report;

‘Harvesting Prosperity: Technology and Productivity Growth in Agriculture,’ states that the relative stagnation in agricultural productivity in recent decades, particularly in South Asia and Africa, where the vast majority of the poor live, underscores the need for new ideas to improve rural livelihoods.

“Renewed investment to increase new knowledge and ensure its adoption can help harness the large potential gains to be made in agricultural productivity and, hence, income,” says the report released on September 16, 2019.

Agric productivity

It notes that nearly 80 per cent of the world’s extreme poor live in rural areas and mostly rely on farming for their livelihoods.

Therefore, poverty reduction efforts need an intensive focus on raising agricultural productivity which has the largest impact of any sector on poverty reduction, roughly twice that of manufacturing.

The Vice President for Equitable Growth, Finance and Institutions at the WB Group, Ms Ceyla Pazarbasioglu, said a boost in productivity in the agriculture sector could lead to more and better jobs, while enabling more people to move off-farm to cities to pursue other opportunities.

“This requires comprehensive reform of domestic agricultural innovation systems, more effective public spending and the cultivation of inclusive agricultural value chains with an increased role for the private sector,” she said.

She noted that new technologies were improving access to and cost of information, finance and insurance in all sectors, including agriculture.

“This can help raise the productivity of low-skilled farmers, but only with the right incentives and capabilities to develop and scale these technologies,” she added.

Some details

The report examines the drivers and constraints to agricultural productivity and provides pragmatic policy advice.

It notes that while in East Asia, crop yields have increased six-fold in the past four decades, contributing to the dramatic reduction in poverty in China and other East Asian countries, it has only doubled in Sub-Saharan Africa and parts of South Asia, with corresponding disappointing reductions in poverty.

In addition, climate change, together with a deteriorating natural resource base, will hit agriculture hard, impacting the poor and vulnerable, precisely in Africa and South Asia.

Increasing productivity

The report recommends that the key driver for increasing agricultural productivity and rising incomes is the adoption of innovative technologies and practices by farmers.

That, it said, would enable farmers to raise yields, manage inputs more efficiently, adopt new crops and production systems, improve the quality of their products, conserve natural resources and adapt to climate challenges.

Research and devt

The report states that the world is facing a widening research and development (R&D) spending gap even as government funding for agriculture is reaching new heights.

It notes that in developed countries, investment in agricultural R&D was equivalent to 3.25 per cent of agricultural Gross Domestic Product (GDP) in 2011, compared with 0.52 per cent in developing counties.

Among the latter group, Brazil and China invested relatively high amounts into agricultural R&D, while Africa and South Asia had the lowest spending relative to agricultural GDP. In fact, in half of African countries, R&D spending is actually declining.

“Governments need to consider both public and private research and technology transfer in strengthening their overall innovation system.”

“Repurposing the current public support for agriculture offers a significant opportunity to revitalise public agricultural research systems, invest in agricultural higher education, and create the enabling conditions to leverage private sector R&D,” it stated.

The WB Chief Economist for Equitable Growth, Finance and Institutions, Mr William Maloney, who is the lead author of the report, said agriculture in Africa and South Asia faced an innovation paradox.

He said while the economic returns and growth effects of R&D and knowledge diffusion were documented to be very high, research spending was decreasing in critical areas of the world and local universities and think tanks were not keeping up.

“Policy makers in developing countries need to give careful attention to reversing these trends and improving the broader enabling environment to encourage private sector contribution as well,” he said.

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