Dr. P.V. Vara Prasad, CoSAI Commissioner, Distinguished Professor of Crop Ecophysiology, Department of Agronomy and Director of Feed the Future Innovation Lab for Collaborative Research on Sustainable Intensification at Kansas State University.
Only 4.5% of the Global South’s total agricultural output is spent on agricultural innovation – equating to USD 50–70 billion per year. The study which revealed this concerning insight, executed by Dalberg Asia and commissioned by the Commission on Sustainable Agriculture Intensification (CoSAI), is the first of its kind. It focused on who is investing in innovation for the Global South; where it is being used; how they are using it; and how much of it promotes the multiple domains of productivity, economic, environmental, social and human benefits that derive from sustainable agriculture intensification.
There is an urgent need to invest more in agricultural innovation. CoSAI’s study shows that if the agriculture sector’s investment in innovation matched that of the energy sector – 6% of total output – it would mean around an additional USD 20 billion per year of investment into innovation for the Global South.
Environmental and social outcomes must be considered
Concerningly, the study revealed that only an estimated 7% of agricultural innovation spending explicitly targets environmental outcomes. Of this, just about half also includes social or human objectives. Most innovation spending is focused on improving productivity and economic outcomes.
This investment balance must change if we are to successfully tackle the key global challenges of food security, malnutrition and climate action; and address the sustainable development goals by 2030. In a world that is rapidly undergoing climate change, investments in innovation that fail to take environmental impacts into consideration will not change the trajectory of agriculture rapidly enough to meet sustainability targets.
The study finds that national governments of the Global South are by far the largest investors, contributing 60–70% of total spending on agricultural innovation. China accounts for about half of this investment. The private sector is the next largest at around USD 13 billion annually (20–25% of the global total), with about half being spent on developing crop inputs like seeds, pesticides and farm machinery.
Funding by ‘development partners’ – a term which covers aid donors, international investment banks such as the World Bank, and ‘philanthropics’ such as the Gates Foundation – only adds up to 10–20% of total investment, with more than 70% of this being ‘bilateral’ (country-to-country) aid. Yet despite their small share, these investments are important, working hand in hand with national government funding.
Government and private investments are predominantly focused on ‘safe’ initiatives; therefore, development partner funding needs to target transformational research and groundbreaking ideas that are high risk but can give high returns.
Reporting back and looking ahead
CoSAI’s study indicates that current reporting of agricultural investment data across all funding sources is very poor in terms of quality and granularity. The study concludes that adopting a standard for transparent reporting and measurement could, in itself, lead to “swift changes in funding patterns” towards sustainability goals. CoSAI has therefore initiated an international Taskforce on Principles and Metrics for Innovation which is a first step in this direction.
Find out more about the innovation investment baseline study: https://wle.cgiar.org/cosai/innovation-investment-study