Making a case for increased public investment in agricultural R&D as the goose that lays the golden eggs

IT HAS BEEN shown empirically that the economic benefits of increasing public investment in agricultural research and development (R&D) is overwhelmingly strong.

Thus the argument sometimes presented as to whether it makes sense to increase, or at least maintain, public investment in agricultural R&D has been rendered a moot point.

Yet, South Africa and other developing countries’ governments continue to decrease public investment on this important and economically sound area of the economy.

Other neighbouring countries have completely neglected investment in agricultural R&D, leading to the inevitable collapse of their agricultural sectors and increasing vulnerability to food insecurity.

South Africa should see this apparent decline in neighbouring countries in the South African Development Community regional bloc as an opportunity to supply both agricultural technologies and inputs.

Much attention over the past two years has been firmly focused, justifiably so, on fighting the Covid-19 pandemic and the havoc it has wreaked on both the health and economic well-being of the world. It is estimated that last year alone more than 1.7 million people died worldwide directly from Covid-19, and that number has been growing ever since. Yet, there is a separate and more familiar threat that has killed more people. Official statistics show that more than two million children under the age of five die from hunger and related illnesses each year.

As if this bleak picture is not bad enough, the number of deaths due to hunger, malnutrition and related complications grows exponentially when considering the additional millions of older children and adults who succumb to this threat annually. And deaths measure only part of the damage done by the severe lack of food and the hidden hunger of micronutirent deficiencies, which cause stunting, wasting and greater vulnerability and predisposition to infectious diseases and other preventable illnesses.

The situation could have been worse had it not been for past investments in agricultural R&D. Agricultural research conducted in the 1950s and 1960s was largely responsible for the Green Revolution of the 1970s and 1980s. This growth in farm productivity was mainly driven by the development of higher-yielding varieties of staple crops such wheat, rice and maize, among others.

Thus agricultural R&D has since contributed significantly to saving millions of people from poverty and starvation. There is an overwhelming volume of economic studies which demonstrate that R&D-driven improvements in farm productivity have helped keep food costs down while reducing global poverty levels.

Regrettably, funding for agricultural R&D has been declining over a long time and is under renewed threat given the competition for resources from government budgets with other pressing priorities and the lacklustre performance of the global economy. There could be no worse time than now to decrease public investments in agricultural R&D.

About 1.8 billion people, or 25 percent of the world’s population, largely in Africa and South Asia, live in abject poverty and remain indigent subsisting on $3.20 (R49) or less per day. Estimates by the World Bank show that the Covid-19 pandemic pushed an additional 250 million people into the category of desperately poor by end of 2020.

There can be no doubt that public investment in agricultural R&D has yielded handsome dividends in the past, and continues to be the gift that keeps giving when governments provide the necessary resources and enabling environments.

South Africa should be increasing public investments in agricultural R&D, not just to sustain progress already made in the face of climate change, ever-decreasing land and water resources and the ailing economy, coupled with the ongoing Covid-19 pandemic, but also to reduce the number of people who are food-insecure, living in poverty, and to increase resilience to major disruptions such as Covid-19.

International literature shows that at least doubling the total global public investment in agricultural R&D, currently around $40 billion per year (or $5 per capita), is the minimum required commitment and South Africa should take a leaf out of this insight. Moreover, South Africa should be emulating its BRICS counterparts in China, Brazil and India who have increased their contribution to global food production and public agricultural R&D spending.

These countries are similar to South Africa in that they are middle-income countries, but different from South Africa in that the latter is not as populous as the former.

Agricultural research is a long-term investment which has been referred by some as “slow magic”. Returns from agricultural R&D accrue over long periods, thus realising the full potential from investments in agricultural R&D requires patience and far-sighted view.

Policy makers in South Africa are advised to realise that such an investment is an incremental and cumulative endeavour, best done with steady and sustained investments, rather than erratic and haphazard approaches.

Emerging evidence shows that past investments in agricultural R&D have yielded tenfold returns, while showing that governments and their development partners have persistently under-invested in agricultural R&D.

So, should agricultural R&D remain the sacrificial lamb at the altar of budget cuts despite such overwhelming evidence for its stellar performance?

Dr Thulasizwe Mkhabela is an agricultural economist and is currently the Group Executive: Impact & Partnerships at the Agricultural Research Council; mkhabelat@arc.agric.za.

*The views expressed here are not necessarily those of IOL or of title sites.

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