Measuring Agro-Industry and Agribusiness in East Asia

Transcription

1 Measuring Agro-Industry and Agribusiness in East Asia Patrick Labaste, FAO/AGS FAO-UNIDO Expert Group Meeting on Agro-industry Measurement (AIM) November 2015, Rome, Italy

2 2 Overview What we were trying to do and key hypothesis to be tested Sources of information, methodology and issues Main findings Unresolved questions and next steps

3 3 1. What were we trying to do? Measuring agribusiness in East Asia Regional study on farmgate to market in East Asia (2013) Qualify and quantify the changes taking place in the AFS Historical and comparative analysis Context of agriculture transformation in East Asian countries Drivers of change: economic growth, urbanization, dietary changes What do we need to know or know better? Research questions: Place and role of agribusiness over time and between countries What patterns can we observe? What are the paths and trajectories? Role of private sector investment in agro-industry and agribusiness What are the policy implications of the changes taking place?

4 4 1. Key assumptions Measuring agribusiness in East Asia Contextualization: how does the agriculture transformation process apply to EA countries? Analytical framework of the WDR 2008 Typology of the Agriculture Transformation Matrix (ATM) Specific patterns in EA countries? The share of agribusiness increases as GDP/capita increases Agriculture + agribusiness goes up even though agriculture declines and until GDP/cap reaches a certain treshold Private sector investment in value adding agro-enterprises can be measured and will also inform on agribusiness activity Value addition is higher in ag export oriented economies for similar GDP/cap level

5 1. The WDR 2008 framework: the three worlds of agriculture 5 Measuring agribusiness in East Asia

6 Agriculture VA as % of GDP 6 1. The Agricultural Transformation Matrix (ATM) 70% Country segmentation based on agriculture s role in the national economy (provides insights into the transformation of the agro-industry) 60% Agri-Based 50% 40% 30% 25.0% Urbanising Transition 20% 10% Developed Pre-Transition 0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Economically Active in Ag as % of Total Economically Active Population

7 Measuring agribusiness in East Asia 7

8 8 Measuring agribusiness in East Asia Share and Size of Agribusiness in National GDP, Selected Countries (2000) Country Agriculture s Share of GDP Agribusiness Share of GDP* Combined Agriculture and Agribusiness Share of GDP Agribusiness GDP ($ Billion)** South Africa Nigeria Uganda Kenya Zimbabwe Ghana All SSA For Comparison United States Brazil Argentina Mexico Indonesia Thailand Chile * Combines the value added for agro-related industries and that of agricultural trade and distribution services. Based on WB, FAO, and UNIDO databases. ** Agribusiness only. Does not include the GDP of primary agriculture. Sources: Jaffee (1999a); Pryor and Holt (1998)

9 9 1. Growth in agro-industry according to ATM typology Measuring agribusiness in East Asia Source: WB/BBA Project (2014)

10 2. Main data sources and indicators Source World Bank (WDI) FAO Stat GTAP UNIDO Comtrade Indicators Population, GDP, agriculture value added, food and merchandise exports, Gini coefficients Agriculture production, value added, trade Value added of (i) agriculture, (ii) processed agriculture and (iii) other FBT manufacturing and overall manufacturing output, value added, gross fixed capital formation (GFCF), enterprises, employees GFCF, reported in UNIDO Indstat, best proxy found for investment Exports (world) ITC USDA FDI inflows, foreign affiliates FBT and Food & Fiber, ERS time series

11 11 2. Sources of information and methodology Measuring agribusiness in East Asia ATM data source: GTAP (Global Trade Analysis Project), Purdue University Input-Output tables (I/O matrices) for 130 countries, version 9.0 Based on Pryor and Holt (1999) methodology 57 sectoral categories at the disaggregated level, grouped into (i) agriculture, (ii) processed agriculture and (iii) other sectors Data extracted for 2004, 2007, 2011 UNIDO: Indstat Relevant parts of manufacturing identified by ISIC code (FBT) Estimation of agribusiness value added using UNIDO/Indstat data for manufacturing, and prorating wholesale, retail and trade value added data from national accounts

12 AGRICULTURE INPUT-OUTPUT TABLE TO CALCULATE THE SIZE AND COMPONENTS OF AGRIBUSINESS: Ghana 2011, in Millions of Dollars Agriculture Processed Agriculture Other (Non-Ag) Intermediate Demand Investment Consumption Government Exports Final Demand Domestic Demand at Market Prices Import Demand at Market Prices All Intermediate Agriculture Domestic Demand PROCESSED AGRICULTURE Domestic Demand at Market Prices Import Demand at Market Prices All Intermediate Processed Ag OTHER SECTORS (Non-Ag) Domestic Demand at Market Prices Import Demand at Market Prices All Intermediate Other Sectors ALL SECTORS Domestic Demand at Market Prices Import Demand at Market Prices Intermediate Use Imports Land GDP Unskilled Labor Exports Structure at Market Prices Skill Labor Ag % Capital Ag Proc % Natural Resources Non Ag % Value Added (L+K+N) Taxes GDP Total Costs Domestic Demand Share of total cost as % total cost (Domestic) 25.2% 12.0% 62.8% Source: Agribusiness as an engine of growth in developing countries, Pryor and Holt (1999)

13 13 2. Issues encountered Measuring agribusiness in East Asia Definitions Agro-industry, agribusiness vs. agriculture/primary production Categorization ISIC GTAP: I/O approach, agriculture vs. processed agriculture, select categories, extraction to get time series Quality and reliability of data Consistency over time and across countries Formal/informal sectors

14 14 3. Main findings Measuring agribusiness in East Asia Findings: Agriculture transformation Has been taking place in most countries, at an accelerated pace in middle-income countries (China, Vietnam, Indonesia) Agribusiness (or agro value addition ) has grown as part of the transformation process Different country trajectories can be observed Policy Implications: Upstream/farm level Facilitate transformation process: (i) land consolidation, (ii) mechanization, and (iii) diversification of farming systems Downstream/farm-to-market Improve: (i) VC logistics efficiency/vc modernization, (ii) farmer inclusion, (iii) food safety, and (iv) flexible and undistortive trade policies

15 15 3. Agriculture Transformation Matrix (ATM), 1980 Measuring agribusiness in East Asia

16 Measuring agribusiness in East Asia 3. Agriculture Transformation Matrix (ATM),

17 Measuring agribusiness in East Asia 3. Visualization of agricultural transformation in selected East Asian countries ( ) 17

18 18 3. Ratio of the value of processed agriculture to agriculture selected countries (2004, 2007 and 2011) Measuring agribusiness in East Asia 4,50 4,00 3,50 3,00 2,50 2, ,50 1,00 0,50-4 chn 6 jpn 7 kor 11 khm 12 idn 13 lao 14 mys 15 phl 17 tha 18 vnm

19 3. Policy Implications from the ATM and related analysis 70,0% 60,0% 50,0% Expanding Export Markets food safety, international standards, 40,0% processed foods 30,0% 25.0% 20,0% 10,0% Developed Urbanising Agribusiness growth contract farming, PPP, larger more professional farms, mechanization Transition Ag-Based Urban Demand Growth Need for basic infrastructure, roads, market linkages, mkt IQ, productivity e.g. access to seed, fertilizer, finance, etc. Continued Urban Demand Growth early stages of agribusiness development, product differentiation, quality and post-harvest Pre-Transition 0,0% 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0% 90,0% 100,0%

20 20 3. Summary of results of quantitative measurements of agribusiness activity across EA countries Hypothesis Quantitative evidence Comment 1 Agriculture transformation Partly Ag employment data to be refined 2 A Agribusiness share increases as GDP/cap increases Partly Time series incomplete 2 B Different trajectories can be identified between countries To some extent Benchmarking of agribusiness size and performance still difficult 3 Agric + agribusiness increases No Not well documented 4 5 Private sector investment in agribusiness related to agribusiness activity Ag. export-led economies transform more rapidly No Yes No aggregate and cross-country data available

21 21 Measuring agribusiness in East Asia 4. Unresolved questions and next steps Right now, still difficult to measure and monitor agro-industry over time and across countries, therefore to properly inform policies Need more robust, easy to measure and universally applied definitions of agribusiness, agro-industry, agro-enterprise Esp. at country level and across countries Continue to work on - and improve definitions, classifications, harmonization, data collection and quality control Could the AIM Project help and how?

22 22 Measuring agribusiness in East Asia Thank you!