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Issues Affecting the Future of Agriculture and Food Security for Europe and Central Asia

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Issues Affecting the Future of Agriculture and Food Security for Europe and Central Asia FAO Regional Office for Europe and Central Asia Policy Studies on Rural Transition No. 2012-3 Issues Affecting the Future of Agriculture and Food Security for Europe and Central Asia William H. Meyers, Jadwiga R. Ziolkowska, Monika Tothova and Kateryna Goychuk July 2012 1 The Regional Office for Europe and Central Asia of the Food and Agriculture Organization distributes this policy study to disseminate findings of work in progress and to encourage the exchange of ideas within FAO and all others interested in development issues. This paper carries the name of the authors and should be used and cited accordingly. The findings, interpretations and conclusions are the authors’ own and should not be attributed to the Food and Agriculture Organization of the UN, its management, or any member countries. Author’s affiliations at the time of writing are Howard Cowden Professor of Agricultural and Applied Economics and FAPRI, University of Missouri; Postdoctoral Researcher, Department of Agricultural Economics, Humboldt University of Berlin; Policy Analyst, European Commission; and PhD graduate research assistant, Department of Agricultural and Applied Economics and FAPRI, University of Missouri. The views expressed in this paper are those of the authors and should not be attributed to their affiliated institutions. 2 Contents Introduction ............................................................................................................................................................. 5 Theme 1. Agricultural Technologies .................................................................................................................... 10 1.1 Setting the stage: High prices, volatility, new market environment ........................................................... 10 1.2 Why the current interest in technology? ..................................................................................................... 11 1.3 Evidence of decreasing yield growth in various countries?........................................................................ 13 1.4 What can be done ........................................................................................................................................ 18 1.5 Differences within the region and different policy priorities ...................................................................... 21 1.6 Management of agricultural research .......................................................................................................... 22 1.7 Public and private investment, research in particular ................................................................................. 24 1.8 Diffusion of information to support technology adoption .......................................................................... 26 1.9 Concluding thoughts ................................................................................................................................... 30 Theme 2. Investment in agriculture ..................................................................................................................... 32 2.1 Introduction ................................................................................................................................................. 32 2.2 Historic trends and current conditions of agricultural investment in Europe and Central Asia ................. 33 2.2.1 State of investment in agriculture ........................................................................................................ 33 2.2.2 Investment climate ............................................................................................................................... 36 2.3 Benefits and risks of investment in agriculture........................................................................................... 42 2.4 The investment challenge for investors and policy makers ........................................................................ 45 References for Themes 1 and 2 ............................................................................................................................. 47 Theme 3. Climate change ..................................................................................................................................... 52 3.1 Agriculture in the climate change discussion – problems and challenges .................................................. 52 3.1.1 Impacts of climate change in Europe and Central Asia – current developments and long-term projections ..................................................................................................................................................... 53 3.1.2 Climate change and biodiversity loss ............................................................................................. 57 3.1.3 Climate change impacts on food security ....................................................................................... 58 3.2 Mitigation options in the agricultural and forestry sectors .................................................................... 59 3.3 Adaptation of agriculture to climate change .......................................................................................... 62 3.4 Need for action, recommendations and synergies between mitigation and adaptation in the agricultural sector ................................................................................................................................................................. 66 Theme 4.Bioenergy ............................................................................................................................................... 68 4.1 Bioenergy production technologies ........................................................................................................ 68 4.2 Current situation and projections for the biofuels markets .................................................................... 69 4.3 Impacts of bioenergy production on food security................................................................................. 71 4.4 Effects and implications of biofuels production .................................................................................... 72 4.4.1 Environmental effects of biofuels production ................................................................................. 73 4.4.2 Socio-economic effects of biofuels production .............................................................................. 75 4.4.3 Technical and sustainability aspects ............................................................................................... 75 4.5 Bioenergy in Europe and Central Asia ................................................................................................... 77 4.6 Recommendations for policy making .................................................................................................... 79 Theme 5. Environmental sustainability ................................................................................................................ 82 5.1 Land degradation, soil health and soil loss ................................................................................................. 82 5.2 Water pollution and conservation ............................................................................................................... 85 5.3 Biodiversity ................................................................................................................................................. 87 5.3.1 Plant genetic resources ......................................................................................................................... 89 5.3.2 Animal genetic resources ..................................................................................................................... 94 5.3.3 Forest genetic resources ....................................................................................................................... 95 5.3.4 Aquatic genetic resources .................................................................................................................... 96 5.3.5 Microorganisms and invertebrates ....................................................................................................... 97 3 5.4 Recommendations ....................................................................................................................................... 97 References for Themes 3, 4 and 5 ......................................................................................................................... 99 Theme 6. Institutional and policy changes ......................................................................................................... 105 6.1 Economic and Market Context for the policy agenda .............................................................................. 105 6.1.1 Outlook for economic recovery ......................................................................................................... 105 6.1.2 Outlook for agricultural markets and trade ........................................................................................ 106 6.2 Policy agenda for an uncertain future ....................................................................................................... 106 6.2.1 Technology and investment in agriculture ......................................................................................... 107 6.2.2 Climate change..................................................................................................................................
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