Transcript Investment needs, sources and instruments

Investment needs, sources
and instruments
Challenge
Population 34%
ag. production 70%
investments ?
Change in diets
600
500
Investing in
agriculture to
eliminate
hunger, gross,
US$ per year
FAO estimates
ODA
Developing government
FDI
Developing private
400
75.7
7.6
300
200
100
0
44.0
7.9
39.3
3.0
11.6
57.9
4.4
351.5
204.1
138.8
Current investment in Meeting demand in Eliminating hunger by
agriculture
2050
2025
Challenge
Issues
1. What is “investment”
ODA Commitments for ARD and Short Term
or Emergency Food Aid in SSA, 2001-2007
India: Agricultural public
spending, 1975-2002
(millions of 2006 US$)
3,000
ARD commitments
Dev. food aid/food security commitments
2,500
Emergency food aid
commitments
2,000
1,500
1,000
500
0
2000
2001
TCI based on OECD data
2002
2003
2004
2005
2006
2007
http://www.donorplatform.org/component/option,com_docman/task,doc_view/gid,597/
Issues
2. Investment priorities
MALAWI. Public Expenditure: Health, Education, Agriculture. 1987-2004
IMF data base
Issues
3. Investment priorities
Returns of agricultural public investments and impacts on poverty reduction in
China and India
R&D
Irrigation
Roads
Education
Electricity
Poverty loan
WB AgInvestSourceBook
Economic returns
India
China
13.45
9.59
1.36
1.88
5.31
8.83
1.39
8.68
0.26
1.26
1.09
n.a.
Returns – poverty
India
China
84.5
6.79
9.7
1.33
123.8
3.22
41.0
8.80
3.8
2.27
17.8
1.13
Issues
3. Investment mobilization
mechanisms
• Investment friendly political and institutional
climate?
• Public investment into infrastructure/institutions?
• Public investment into production?
• Subsidies to investors?
• Intergovernmental agreements on FDI?
• ????
Issues
4. FDI into agriculture
• New trends last 3-4 years (“Outsourcing’s Third Wave”) :
• cross-boarder investment in primary agriculture increasingly
directed towards land acquisition
• from recourse-poor countries to developing resource-rich countries
in order to develop agrifood exports
• under bilateral inter-gvt agreements
• Benefits:
• technology transfer, employment creation, infrastructure,
development and export earning
• Threads
– for host country
• rural employment, access to ag. resources to loc al population
• food insecurity
– for international trade
• non transparent, less liberal markets and investment