HISTORY OF ODA TO AGRICULTURE AND THE L'AQUILA PLEDGE

At its height in the mid-1980s, global official development assistance (ODA) to agriculture reached $20 billion, before it declined precipitously to just $3 billion in the early 2000s. Slowly climbing back, total ODA to agriculture in 2009 was $9 billion. The reasons for the decline are many, but two stand out: (1) complacency about the world’s food supply after agricultural science dramatically improved food production in the 1960s and 1970s in Asia and Latin America; and (2) the development doctrine of the late 1980s and 1990s that insisted that developing country governments dismantle state-owned and state-run enterprises, including agricultural research, education and outreach services. [1] No longer supported by even relatively small institutional and educational systems, developing country farmers were left in the dust. African countries, in particular, were hard hit, given their very underdeveloped private sector and public institutional systems. The ‘Green Revolution’ that transformed agricultural production in Asia and Latin America never reached Africa. Africa’s diverse micro-climates, varied food staples and sparse connective infrastructure and marketing systems meant that the technologies developed for Asia and Latin America could not spill over here.

Source: OECD DAC

During the past 45 years, Africa’s agricultural productivity has lagged behind that of the rest of the world, with grain yields just one-third of those achieved when Asia and Latin America were developing. [2] Disappearing funding for agriculture left farmers in the developing world vulnerable to shocks – depressingly low prices induced by subsidies lavished on developed country farmers, extreme weather events and unpredictable markets – that eventually erupted into a global food crisis. Between 2005 and 2008, maize prices nearly tripled, and the prices for wheat and rice increased by 127% and 170% respectively. [3] The dramatic spike in food prices severely affected the asset base and nutritional status of poor people around the world, leading to irreversible economic and physical damage, riots and unrest.

Poor people in developing countries are especially affected by high food prices because they spend on average between 60% and 80% of their incomes on food. When food gets more expensive, they eat less and have to make many other hard choices. Faced with higher food bills, poor people eat cheaper, less nutritious food, sell off their productive assets such as livestock or tools to afford more food and cut back on other necessities such as medicines and school fees. Often, they cannot get much from selling assets as everyone else is coping in the same way, and they lose their ability to earn income later, so often they never recoup their losses.

After more than two decades of neglect, donors responded to the wake-up call of the 2008 global food crisis. At the 2009 L’Aquila G8 Summit, the G8 and five other donors committed to mobilise $22 billion, $6 billion of which was new money, in financing for agriculture and food security. They also promised to do the following: (1) deliver the funds within three years; (2) agree to a set of principles on how they would spend this money; and (3) remain transparent and accountable on their commitments. They adopted principles four months later at the World Summit on Food Security and dubbed them the ‘Rome Principles’. Soon thereafter, the $22 billion commitment became known as the L’Aquila Food Security Initiative (AFSI), and the US calculated its potentially massive outcomes: 40 million poor farming families, most of them living on less than $2 per day, would be on track to increase their incomes by 250%.

To achieve the strategic objective to ‘take urgent action to eradicate hunger from the world’, donors adopted the Rome Principles. In the Declaration of the World Summit on Food Security, where the principles were articulated, donors emphasised working with poor countries as partners, in particular through the Comprehensive Africa Agriculture Development Programme (CAADP), improving coordination, strengthening the role of multilateral institutions and taking a comprehensive approach to food security. On the surface, this might all seem fairly straightforward, but it is actually a significant shift in donor transparency and, potentially, effectiveness. This is the first time that donors have committed to identifying how they plan to spend aid dollars, in terms of investment sectors (e.g. farming versus storage) and the target populations in which they intend to invest.

Food insecurity is a global challenge that requires a diverse response, including support from the emerging economies of the G20 and, most importantly, political will and financial resources from developing countries themselves. However, it is critical that traditional donors remain accountable and lead by example to leverage action by other actors. More pressure can be exerted on African governments to meet their Maputo targets to spend 10% of their national budgets on agriculture if L’Aquila donors make good on their promises. Similarly, greater donor support for agriculture and food security can encourage private sector investment. But failure to meet the L’Aquila commitments could lead to a retreat from agriculture. Based on the findings of ONE’s research, donors have a lot to do in a short amount of time if they intend to fulfil their promises to address global food insecurity.