Gates and innovation in agriculture – is money the issue?

26 January 2012

Bill Gates has spoken on the Today Programme about his recently published Annual Letter, in which he highlights the work that needs to be done in agriculture to improve the lives of poor farmers, particularly those in Africa and South Asia.

In his letter, Gates stresses the need to refocus on agriculture after years of neglect, where supply in the last decade has failed to keep pace with the expanding demand for food driven by population growth and increased incomes. In many countries, climate change is likely to put  downward pressure on yields that will widen the gap between supply and demand still further.

Gates highlights the role of innovation in accelerating growth in agricultural production, drawing on the Green Revolution for inspiration. The main innovations that he refers to include more effective delivery of existing technologies and techniques, and the development of new approaches and tools. Improved crop varieties are a mainstay of this approach but soil management techniques and infrastructure (such as drip irrigation) are also mentioned. Farmer education and training to deliver technologies and techniques are also important in both Gates’ letter and in his radio interview.

So, what does he think holds back innovation in agriculture?

Two factors come through strongly: the lack of funds directed towards research in agriculture, and inadequate delivery of technology and techniques to farmers. In the case of the former, US$3 billion is spent every year on research into the world’s seven most important crops, of which only a fraction is directed at small farmers in Africa or South Asia. This is just 0.5% of the annual gross value of those seven crops.  

Gates’ call for increased attention to agriculture is very welcome and the focus on agricultural research and innovation is well deserved: returns to agricultural research can be very high, and such research is relatively cheap when compared to the gross value of agricultural production.

However, technology is only part of agricultural development (as we at ODI have demonstrated through work commissioned by the Gates Foundation to understand what gets agriculture moving): governments must engage wholeheartedly in getting technology to farmers, and farmers need incentives to innovate and invest on their farms.

So, getting an adequate investment climate in rural areas matters — peace; a reasonably stable macro-economy; keeping taxes on farmers, both implicit as well as explicit, within bounds, etc. Complementary public investments are also needed for rural roads, clean water, public health, and schools — farmers who cannot get to the market, who are repeatedly ill, and who cannot read or carry out simple sums are unlikely to innovate.

The value of the an adequate investment climate and spending on rural public goods should be well understood by now: just look at what happened to Ghana’s agriculture, rural poverty rate, and child malnutrition from 1983 onwards after the government took these lessons to heart. Ghana not only has had one of the world’s top six best performing agricultures, but has also seen great reductions in rural poverty and hunger that make it one of the few countries in Africa that will achieve Millennium Development Goal 1.

So, while more needs to be spent on generating better technology for farmers in the developing world —and Gates is right to be excited about the prospects – efforts to implement new solutions must focus not only on constraints to delivery but also those to uptake. And this depends, crucially, on who is the target of new techniques and technology, their livelihood strategies and the role of agricultural production within that, households’ resource base and labour availability, and their attitude to risk.

The palpable frustration of scientists and philanthropists who can see technological and technical solutions to remedy desperate situations is perfectly understandable, and they are right to strive for changes that could improve those situations. Certainly, anything that puts a spotlight on the needs of poor farmers in developing countries is a positive thing, and additional funds are sorely needed. However, we must keep in mind the people on the receiving end of such ideas – namely the farmers on the ground – and try to understand why they sometimes seem indifferent to solutions that appear perfectly logical to researchers, policy-makers and donors.