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This is an archived USAID document retained on this web site as a matter of public record.
Remarks by Andrew S. Natsios
Administrator, USAID
World Food Day Remarks: Agricultural Productivity in the Developing World
October 16, 2003
Thank you very much. I won't have a chance to say some nice things about Catherine Bertini tonight, so I'm going to say them now and then I'll get into the substance of my remarks.
She's a personal friend of mine, even before she was the head of the World Food Program (WFP), Executive Director, she was Assistant Secretary of Agriculture. We worked together in the first Bush Administration and we developed a warm friendship. We ran for office, both of us unsuccessfully. Otherwise, we probably wouldn't be here right now.
I was very depressed when I was defeated in Massachusetts, and the pastor of my church said, "Andrew, there's something else that you'll be doing, you just don't know what it is yet." And that certainly happened to me. If anybody told me 15 years ago, that I would be standing here as the head of USAID right now talking on this subject, I would tell them they're mentally ill.
But it's happened. It's happened. So I want to make some comments about Catherine. She took over a U.N. Agency, which is probably the premiere agency right now, in terms of size and competence in the U.N. system. If you ask people privately, they'll all say every U.N. agency's wonderful, but they're not all the same. I have to just tell you that there is a big disparity.
When she took it over, it had some very serious problems. And there was even a move to have it merged into another U.N. agency. Between '92 and 2001, the period that she was the Executive Director, international support totaled $15.5 billion, mostly in food. The United States contributed 41 percent of that, $6.3 billion. We are the largest donor.
I was with the President a year and a half ago, and we were going over some data for a meeting with Prime Minister Meles of Ethiopia. And I said, Mr. President, you know that 60 percent last year --this was the year before last-- of all the food that went to the World Food Program came from the United States. He said, 60 percent? Well, the American people don't know that. I said, maybe we should start telling them. He puts it in all his speeches now. I have to tell him there are other U.N. agencies that we need to talk about in his speeches. He's very proud of our food aid donations to the U.N.
By the end of Catherine Bertini's tenure, 39 percent of world food aid, some 3.75 million tons, was being channeled through WFP. And that was not based on an assessed requirement. In other words, WFP is a voluntary agency. They don't get any money automatically. They get it because they do a good job. My rule is, if the agency's competent, pour money into it. If it's not, make a nice little contribution and go to an agency that is well run. And Catherine Bertini, in my view, when she finished, was not only the preeminent leader on hunger and food aid issues and famine in the U.N., but, also, easily the finest manager and leader of any U.N. agency. I don't mean to denigrate my other friends in the U.N., but technically, she was the best.
We don't talk about that a lot. What we talk about that are the more sexy issues of hunger and malnutrition. But you know, if you can't manage a giant program of a lot of money and people, the people don't get fed, the money isn't spent properly. It's spent in the wrong places. Management is one of the principal challenges for NGOs, aid agencies like my own, and U.N. agencies. Having people who are committed personally and ethically to our work, but also know how to run huge institutions and reform them, is critically important. And Catherine did that.
By the end of 2002, WFP feeding programs in the schools were feeding 15.6 million children in 64 countries. She led the WFP effort in averting food crises in places like Kosovo and East Timor in the late '90s and in the Horn of Africa in 2000.
Her greatest triumph, I would say, and I'm a little biased because I worked with her in so closely on it, was in Afghanistan. Some people thought the whole U.S. aid program there started on September 11. It did not. It had been going on for ten years, through three Administrations. It was not to help the Taliban; it was to help the people of Afghanistan. We saw from WFP VAM maps -- vulnerability assessment maps which Catherine invented - they are now a regular thing, everybody asks where the VAM map is; actually, no one had even heard of a VAM map before she was head of WFP; they tracked which provinces had the highest rates of malnutrition and which had to be targeted for which kinds of food aid; we never had that skill before Catherine was at WFP -- and we saw data from WFP and the NGO community in the spring of 2001 that said there was going to be a massive famine in four or five months, [inaudible] and we sent--started sending teams. And Catherine sent teams and I did and the NGO community from UNICEF. And we began a massive effort. Between October of 2001, just two weeks after the terrorist attack on the United States, and April 2002, WFP delivered nearly 350,000 metric tons of food.
I had to give almost daily reports to the President; he was really focused on whether this famine was going to take place or not. He wanted to know if the tonnage was delivered, and I told Catherine on the phone, please make sure the stuff gets delivered, because if I don't have a good answer, I get embarrassed in front of Secretary Powell who was also very focused on this. Along with my friend (Agriculture Secretary) Ann Veneman who was processing all this food, we worked with the Department of Agriculture people in Kansas where the center is for USDA to do the processing. We ordered the food through the Department of Agriculture offices in the mid-West for WFP and the NGO community. And we avoided the famine. We saved, perhaps, a million people's lives in Afghanistan.
It was Catherine Bertini who led that fight and she deserves credit, in my view, for stopping what could have been one of the major catastrophes in the beginning of the 21st century.
Fifty-six WFP staffers were killed in the line of duty in the ten years that she was head of the WFP; this is was because WFP was in the middle of the war zones. You know, people think the only time people are getting killed in these emergencies is in Afghanistan right now and Iraq. That's not true. It's just it's in the newspapers now because there are American troops there. Our people have been getting killed. I lost five people, five people in my little office in AID in the first Administration, AID workers getting killed. I worked for World Vision for five years, one of the largest NGOs, and we lost 42 people in four years. AID workers are at risk in many of these emergencies.
Catherine set up one of the most elaborate and sophisticated security systems of any of the federal agencies and specialized training courses to train 5,000 WFP staff on security issues to reduce the number of people who were at risk.
She moved 75 percent of her staff out of Rome into the field where people belong, in my view, and she invented the financial Management Improvement Program, which she launched in the 1990s. She also established the first Inspector General Program of any UN agency and lowered WFP administrative overhead to the lowest of any UN agency.
Anyway, I wanted to say that, Catherine, with you sitting here because I don't think you are recognized adequately, not just for your work on world hunger, but for your superb institutional leadership as a manager and leader. I think, frankly, we need to Xerox you and send you all over the world.
I do want to talk now about a policy issue that's of great concern to me. And I think Ann Veneman, my good friend, the Secretary of Agriculture is going to talk about it, too. But I'm sure there's not going to be a lot of repetition, this is a big subject and that is: The question of agricultural productivity in the developing world.
Most people don't know this, but since 1980, 50 percent of the improved agricultural productivity in the developing world was from improved seed varieties. And a large portion of that was through the work that Norman Borlaug started during the Green Revolution in Asia in the 1960s but, also, through the CGIAR network, the Consultative Group on International Agricultural Research, which was a subunit of the World Bank; it's a set of 16 or 17 research stations around the globe. And they do excellent work. Pedro Sanchez got the award last year as the head of the Tropical Forestry Institute in Kenya as I recall, which is one of these centers.
The CGIARs' work has been instrumental in getting into the developing world improved seed varieties that have increased productivity and reduced the requirements for imports. We used some of seed after the fighting was over in Afghanistan to introduce improved varieties of wheat, so that wheat production would go up 60 to 70 percent and be drought resistant. Because Afghanistan has droughts quite frequently and that's what induces the famine sometimes.
And so, we now have in the agricultural system, large amounts of seed developed by these international research institutes within the international system. The United States government has been the largest donor since the '60s. And I actually, we increased, Emmy Simmons and I, the assistant administrator our senior agricultural economist in AID, increased the funding for that because I'm so committed to the research work, as is Secretary Powell.
What you need is improved seed technology from the scientists and the right economic policies, because when you get the wrong policies, people will get discouraged from producing more food, because they can't get returns for the costs they invested in input. We had this happen in Ethiopia two years ago; they're having a famine this year, a terrible problem. We put a million tons of food through WFP and the NGOs into Ethiopia -- Catherine's successor, Jim Morris, has been instrumental in that effort. But I'm about to see Meles now, the Prime Minister, to tell him what we all agreed to -- and his government's agreed to: that unless Ethiopia changes its policies, we can invest all the money we want in the agricultural system and it will not improve.
Two or three years ago, we made these investments, particularly the Europeans, in agriculture in Ethiopia. They produced more food and the prices collapsed because there's no exchangeability with the Ethiopian currency. There are trade restrictions; they could not export their surplus to neighboring countries, where there were droughts. So what happened? The price collapsed to 25 percent of its normal rate, and as a result of that the farmers said, "We're not growing anymore extra food; we're going into bankruptcy. We couldn't sell the food we grew because we couldn't export it."
So if you don't have the right economic signals and the right economic policies, if you grow more food, you can actually cause problems. You have to marry your economists with your scientists. That's our rule and that's what we're doing in our programs and I know a lot of developing countries.
We heard earlier today from someone from Bangladesh. Bangladesh doubled their doubled their rice production, but they used market economics to do it. Doubled the rice production from 1985 to now. There used to be terrible famines in Bangladesh. No one talks about famine in Bangladesh anymore. Because production has increased so much and industrialization is rapidly increasing people's income, the country is developing at a very rapid rate now.
The third thing to do is you have to get these technologies, particularly in seed, out to the rural areas to the farmers. Not just the big farmers, you need to do it to the big farmers and the poor farmers. I've heard this debate for too long and I'm sick of listening to it. Some people argue that we should just help the big farmers that are the most efficient. I've NGO types say, no, don't help the big farmers at all, just help the little farmers.
If we did that in the United States, we would still be poor and hungry ourselves. We didn't distinguish; we didn't just help one sector of our country, we helped all of it. This was in the 19th century.
What people don't remember about America, particularly in the developing world -- when I say this, people say, "I don't believe you." In 1800, America was weak, unstable, and very poor. We had large rates of malnutrition. We had disease epidemics. My hometown in New England, Massachusetts, where I come from, we had lost 20 percent of the population of our town in an epidemic in three weeks in 1831. Nobody even knows what the disease is today, but there are mass graves in the town, terrible. People forget all of that.
You know who our greatest development President was? Abraham Lincoln. Nothing to do with the Civil War. He did three things which many countries in Africa are beginning to do now. There are three or four of them looking at what he did. He built infrastructure. He built the Continental Railroad. He approved the legislation, that tied the country together; that allowed the surpluses of grain in the Middle West to be moved to the coast to be shipped to Europe and around the world. Without the train system, we couldn't move our surpluses around. We couldn't move seed around and fertilizer around, which are also necessary to increase production.
Second thing he did: the Land Grant College System, colleges like Iowa State, University of Massachusetts. And they educated people in two subjects in those schools: teachers, to educate our kids; and agriculture school. How do you think we took scientific agriculture, what we knew about it in the 19th century and extended it across the United States? It was through our agriculture schools. And who invented those? The Land Grand College System; it was signed into law in the 1860s. People forget about that. And it meant poor farmers could go to school and learn how to grow more food and become middle-class.
The third thing he did was the Homestead Act. He signed the law that said, if you live on your land a certain number of years, you can get a 100 acres of land free to settle the West and the Mid-west. That meant that we created a class of middle-class farmers who, in fact, became the backbone of America for a century.
Now, it's very interesting, something that happened in Asia. Three countries that were extremely poor, in fact they were among the poorest countries in the world in the 1950s; Japan, because of what happened in World War II; Taiwan and South Korea. If you look at people born during that period, they're much shorter. If you go to the cities and see the younger people in those countries, they're as tall as I am. Why is that? Why are those three countries now among the wealthiest countries in the world?
General MacArthur enforced land reform in Japan and distributed the feudal estates to the middle-class -- what he created was a middle-class of farmers and it was the most successful land reform in the history of the world, next to Taiwan, which was the most successful. And the focus then, was not on the cities, it was on the rural areas. One of the major mistakes we made in development was, because the cities were growing, we redirected all of our rural aid into the cities. And my staff or urban scientists and sociologists are very upset with me. But I said, "Look, we don't want them to move to the cities, the cities don't have the infrastructure the Third World. We need to work in the rural areas to keep people there, to make life better, with health clinics and roads and schools. But most importantly to increase agriculture production and increase family income."
Now, I'd like to talk about something that's troubling to me in terms of misunderstandings. Because if we're going to do this right, we need science blended with economics, as I said earlier. One of the most important new things that could revolutionize agriculture, particularly in Africa, is biotechnology. Very controversial, but I need to talk about it. I'm very troubled that politics has overtaken science in dealing with this issue.
There is a view that biotechnology only affects or helps big farmers. That is simply not the case. For example, Bt cotton, which is grown now by small farmers in South Africa, China, and India. In the Makatini Flats in South Africa, 70 percent of the cotton that is grown is Bt cotton, which is a biotech cotton. Most of the farmers who grow it are women, and by planting it, they have increased their family incomes in a matter of two years by 30 percent. And they've also reduced pesticide use and reduced overall backbreaking work on the farms.
We are now providing grants to five prominent South African scientists to develop new seed varieties for different agro-climatic growing regions in Africa, because the kinds of seed we develop here are not necessarily useable in Africa under the current circumstances.
In India, the same kind of cotton is being tested and there's been a yield increase of up to 87 percent. The average farm size in India now is five acres and so there's enormous potential for this.
But some people think that the only research being done is being done in Western Europe and the United States in biotechnology or in Canada. Let me tell you, a year and a half ago, I opened a biotech research center in Egypt with the minister of agriculture. The minister is a very visionary figure; he'd wanted to do this for years. We finally got the money together with the Egyptian government. I was stunned when I was there to find a third of the Egyptian agriculture system is now modernized agriculture, comparable to the United States. They're even using the drip technology the Israelis developed for desert areas. And huge areas of land that were desert are now, using drip technology, productive areas of Egyptian agriculture. That was done in laboratories. It was done by scientists.
Nigeria, Indonesia, the Philippines, Uganda, South Africa, Kenya, are all making commitments to do research in biotechnology to improve productivity.
We also know biotechnology can have a good effect in reducing pesticide use and herbicide use. The New York Times has reported that in China, farmers who adopt biotech cotton, no longer need a drug called atropine. Do you know what atropine is? If poisoned by certain kinds of poisons, you take atropine to prevent yourself from dying. Atropine was widely used in Chinese farms because pesticide poisoning is so common. Thousands of Chinese farmers and their kids would die from pesticide poisoning each year because of the inappropriate use of it. There's been a dramatic reduction in atropine use on the farms because they're not using the pesticide anymore, because of the Bt cotton and the other kinds of cotton they're growing with biotech.
So, what we don't do sometimes on this controversial subject is look at what the alternatives are. We need to weigh carefully the different alternative ways of approaching this. Per Pinstrup-Andersen, who I think is Paul Hurley's good friend who used to the head of one of the CIGAR research centers, wrote a wonderful book with a colleague of his -- and he's not an American, you can tell from his accent, he's a Dane - it's called, "Seeds of Contention," which is on the use of biotechnology in the developing world and how we need to analyze this properly.
There are also other things that are beneficial. One of the most exciting things I've seen in the developing world is in South Africa: they're taking a gene from a de minimis plant that requires almost no water to grow, and they're taking it and putting it in white corn, to see if they can grow a corn variety that needs very, very little rain, because Africa has the lowest irrigation rates in the world -- and needs grain from agriculture to produce its food -- to see whether or not we can produce a grain variety that will be favorable in African climatic conditions, which are erratic. Sometimes there's good rain, sometimes there isn't.
The last thing we're doing, which I want to mention before, I think I can answer one question in the time remaining -- is in the area of micronutrients.
You saw here some previous speakers talk about what happens when there are micronutrient deficiencies. There are two ways to deal with this: One is to give people a pill or put micronutrients in the grain that's milled. That's a good way to do it, but it's not the best way. The best way is to eat a balanced diet. But a lot of countries in the developing world do not have food sources that have all the micronutrients naturally in their products, without adding it in. You know where we get most of our micronutrients in the United States, anybody know?
In the early 1950s, there was a huge debate in the United States, very emotional debate, about the fact that our cereals, produced by Post and Kellogg and the rest had no vitamins in them. There were calories in them, but that was it, calories and sugar. And if you look at the side of the box of cereal, you will see added into all of our cereals now in the United States are all of the major micronutrients. That's how our kids get their micronutrients guaranteed is through our cereal boxes.
They don't have cereal boxes in most developing countries, particularly the poorest countries. So, what's the alternative? Change the diet. In Mozambique right now, we have introduced sweet potato varieties from the Andes Mountains and from other parts of Africa that have very, very high levels of vitamin A, which is one of the great miracle micronutrients, minerals.
And a child taking two doses of vitamin A a year, just two, will have 25 percent reduced rate of dying from childhood illnesses before they're five. It is a miracle drug because it strengthens our immune system. How are we going to get it into people's hands so they just eat it naturally through sweet potatoes? A hundred and twenty-five NGOs in Mozambique took seed cuttings from an improved variety of sweet potato that's very high in beta carotene, extended it to the country, and now it's in the food system. They had to introduce a new variety from the Andes that was more bitter because the men do not like the sweet potato sweetness of it--only children and women do. The men like something more bitter. So, we have two varieties now; one to appeal to the men's tastes, and one to provide for women's and children's tastes.
But the point here is taking agriculture and marrying it with nutrition makes a huge difference in the context of the agriculture system. So, anyway, those are some of my comments and I'm hoping we can get past the politics of the trade war between Europe and the United States so that Africans, many of whom want to do this. They're afraid that if they start experimenting with this, developing their own research centers, they will get drawn into the trade war and hurt their export potential, which would be a great tragedy in my view. So, thank you very much.
DR. RICE: Andrew Natsios has agreed to take a question or two if--we have a couple of minutes. Is there anyone approaching--please identify yourself.
QUESTION: My name is Filosh Speace [ph], I am from the International Union of Food Science and Technology. I have not a question, I just would like to make a comment. I think it's extremely important that we are improving the agricultural production as we have heard this morning in a couple of cases.
But there is also one point which I feel is a little bit neglected. This is the post-harvest treatment. We are losing about 30 to 40 and in some cases even 50 to 60 percent of the agricultural production. And this is due that there are not sufficient equipment and what is even more worse that the people are not trained to take care of the agricultural production in the appropriate form. So, I think, also, this area has to be approached once we are trying to improve the living conditions around the world, especially in subSaharan Africa. Probably you could comment on this.
MR. NATSIOS: This is a very, very serious problem. When I was doing the research for my book on North Korea, Catherine and I worked together on trying to avoid that terrible famine from taking place. But in the research I did, I found out something a little disturbing -- that the North Korean government was not, in their food estimates, estimates of production, talking at all about the crop losses. And crop losses in socialist, Marxist economies, their agricultural system, are much higher than they are even in the developing world. A Russian economist/scientist who I know, told me that the crop losses in North Korea were 40 percent, 35 to 40 percent rottage in the fields, before people could eat the rice.
So, I think one of the causes of the North Korean famine, beyond the Marxist policies that they follow, was the fact that no one cared that the food had rotted in the fields because it wasn't stored properly. That is a very serious problem in Africa. The average, I understand, is that between 20 and 30 percent of the crops are lost. So one of the things that we introduce into our programs in many African countries where we're working in agriculture is proper storage. Harvesting properly, and then storing properly. It's extremely important.
QUESTION: This is [inaudible], formerly with IFTA. I'm wondering, you mentioned support to the CGIAR centers, could you talk about where we are not, in terms of US financing of the CGIAR centers and what your target is? Thank you.
MR. NATSIOS: Well, I can't tell you what it was last year, I think. This is my memory. Just so you know what AID's budget is, why don't we start at 2001? That year, AID spent $7.8 billion. That is the budget spending levels of AID in 2001. Last year it was $14.9 billion. There's been a 90 percent increase in AID's budget in two years. It's the largest increase since the Marshall funding. It's been a massive increase. And I try to memorize all the statistics, but I can't. But my memory is we contributed $45 million to the CGR. We do it in two ways. One is core funding, but then we fund individual centers for specific intervention projects that we like. If you can give me your card, I can send you the data on what it is. But USAID Assistant Administrator) Emmy Simmons and I are both big advocates at this and to the extent that we get the money, we have been increasing that.
And we did, there was an effort. I won't discuss who tried to, but some countries tried to cut the CIGAR budgets at the World Bank because the Europeans -- it was the Americans, with African ministers of agriculture , who stopped the cuts from taking place. Like, so, I do want to thank my friends from Africa for doing that. Any more questions.
QUESTION: I have one question if I could. I, you know, spent my first six years of my career as an AID officer in the Mekong Delta in villages and, you know, I had been expecting, when I joined the foreign service, I was going to go to Rome or Paris, London, you know, stop on [inaudible] if I had to, but and instead, I was put on a plane and shipped off to the Mekong Delta and I was in the middle of eight villages. And it was just at the time that the miracle rice that Dr. Kuche [ph] and Dr. Swaminophin [ph] and Dr. Borlaug had pioneered arrived in the Mekong Delta. And so the process of getting the seeds and the technology, just like you were talking about biotech, out in the villages was then taking place.
And we were also building a road. And what we found was, and I asked this question this morning with Pers, as far as the road went, life was transformed. And it was transformed in terms of health, nutrition, girls going to school, people going to school and in security. The security problems evaporated. Where the road ended, everything was as it was before. It was dangerous and people were still living as they were 50 or 100 years before.
And I know when I was ambassador, it was always a big debate about whether to put money into roads or not and we got built some and had--and it destroyed the Khmer Rouge, the Khmer Rouge are gone. Whole terrorist organization destroyed in ten years and many things but roads. I just wonder if roads fit in your sense of the future?
MR. NATSIOS: Well, the standard practice, I have to tell you, was for all the AID agencies, all of them with maybe one exception, and the banks except for the World Bank and the other regional banks got out of the business, they said they were still building roads, but if you look at it, no one was building roads. And if you asked people in the developing world, what they want was roads. Now, I was convinced that our people were right and should do roads, until the President ordered me to build this 365 kilometer road in Afghanistan. And I began looking at it by saying, well, I'm going to have to do this so I might as well become enthusiastic. Are there any benefits to this?
We went and started looking at the health benefits. A lot of women in villages were dying because they were pregnant and couldn't get to the hospital fast enough. They bled to death. You can't get the teachers to the schools. You can't get the school books to the schools. You can't get the seeds to the farmers. We are building this road from Kabul to Kandahar, then we'll go from Kandahar to Herat, working with the Japanese and Saudis. And I've been told I will have it finished, the first phase, by December 31, and we finished 19 bridges. As we look at it, our officers are saying, "If you have the money, Andrew, this is a good investment a very good investment." And we've now put in place $100 million agriculture contract in Afghanistan, a third of which is going to go for rural roads, roads up in the villages to get the villages down to the main roads.
So, I am now a convert to this thanks to Colin Powell, and the President who informed me that I will be enthusiastic, but I generally am convinced now. And we are having a big discussion in the AID community because our development officers are relooking at this. The reason we got out of it is not because it's a bad idea, because it's expensive. If we're investing more money in development now than we are, we need to relook at this issue because infrastructure does count. You can have all the school books you want and teachers. If there's no roadways, you know, it's a little difficult to have school when it's raining out or it's bad weather or it's really hot out. You need school buildings. You need health clinics to do the healthcare. So you've got to do both the infrastructure and the technical work at the same time.
So, I am now convinced, Ken, that you were right all along and I was wrong.
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