Chicago Council on Global Affairs Speech May 24, 2011, Prepared Remarks by Bill Gates, Co-chair and Trustee of the Bill and Melinda Gates Foundation
Thank you, Representative Granger, for that kind introduction. Everyone here is grateful for your long-standing leadership on global health and development issues, and we look forward to helping you as you continue leading the charge in the future.
And thanks to the Chicago Council on Global Affairs for inviting me here to speak today.
I’d like to start by telling you about Odetta Mukanyiko.
Odetta is a single mother with two children. She lives on the eastern side of Rwanda, farming a half hectare of land, feeding her family with her harvest, and selling the rest to local traders. She’s been working the same tiny plot of land for 20 years, making less than a dollar a day.
There are hundreds of millions of people whose lives are like Odetta’s. Three-quarters of the world’s poorest people – most of them in Africa and South Asia – get their food and income from farming small plots of land. These farming families don’t have quality tools, good seeds, reliable markets, or money to get the most from their farms. So they work hard, but they get no traction, and they usually stay hungry and poor.
But a year ago, Odetta’s life began to change. She was approached by the World Food Program, which as you know, buys huge amounts of food – mostly from large farms – to feed people affected by famine or disaster. Through a program we’ve helped fund called Purchase for Progress, they’ve begun to buy food from small farmers. The aim is to help small farmers gain access to reliable markets – so if they produce more, they can sell the surplus, and become self-sufficient.
They told Odetta and other farming families in her village that if they improved the quality of their maize and bean crops, Purchase for Progress would pay them a good price. So Odetta borrowed some money, expanded her plot, and planted more than she ever had before.
She sold all her crops, as they had promised. And in one year, her income quadrupled. Suddenly, for the first time in her life, Odetta had more money than she needed, so she adopted two small children. Now she has four. She feeds them. She pays school fees for them. She buys health insurance for them. And she can house them all too – because she replaced her two-room hut with a four-room home.
The change in Odetta’s life has just begun. She got another loan and bought more land. She’s hired eight of her neighbors to help her farm. She’s using fertilizer from a Rwandan government program. Her government also gave her a goat – which she will breed so she can sell the offspring.
When Odetta is asked if she’s unique in the community, she says: “No, everyone here has a story like this now….. Farming is wealth.”
Helping poor farming families is the answer – the best way to fight poverty and hunger and feed a growing population.
Since its start less than three years ago, Purchase for Progress — under the leadership of WFP Executive Director Josette Sheeran — has contracted to buy 170,000 metric tons of food from small farmers like Odetta. So far, P4P has paid out an estimated $37 million, channeled more directly into the pockets of small farmers and traders. But P4P does more than act as a buyer. It helps farming families develop the crops and market access they need to sell to other large buyers on a regular basis.
The program now reaches 100,000 farming families in 20 countries. But we can reach millions. Poor farming families need more income. The world needs more food. Working together with farmers like Odetta, we can boost supply to meet demand – and make historic progress against poverty and hunger.
The Challenge of Agriculture and Food Security
In 2008, as everyone knows, food prices jumped to record levels, causing riots, hunger, instability – and a plunge back into poverty for millions. Early this year, food prices spiked again – even higher than the peak of three years ago.
When a family spends more than half its income on food, and prices rise – they have no choice: they have to sell belongings, pull children from school, and stop spending on health. All of this drags them deeper into poverty. And if millions of desperate people can’t feed their families, instability follows.
Today, there are nearly a billion hungry people in the world. We are projected to add another 2 billion to the world population over the next 40 years. This means that by mid-century, the world will have to feed 3 billion more people than we’re feeding today.
Solving poverty and hunger is both an urgent problem and long-term challenge. But it’s actually a more hopeful story than most people realize.
We already have solutions. We have programs, like P4P and “Feed the Future,” that are helping farmers lift themselves out of poverty. We have the attention and commitment of world leaders. And we have billions of dollars in pledges. Now we’ve just got to keep our promises, keep helping small farmers grow more food – and do it in ways that can meet the needs of this generation and the ones that follow.
Right now, the average farmer in sub-Saharan Africa gets just over a ton of cereal per acre. An Indian farmer gets twice that; a Chinese farmer, five times that; an American farmer; seven times that. Why is there such disparity? Farmers in other regions have tools and techniques and resources that African farmers do not. By offering farming families in Africa and South Asia the same advantages, the least productive farms can come closer to the most productive.
How is the world helping the poorest farmers grow and sell more? The strategy is in innovation – combining the best of what’s worked in the past with new breakthroughs, customized to the needs of small farmers.
- Innovation in seeds brings small farmers new high-yield crops that can grow in a drought, survive in a flood, and resist pests and disease.
- Innovation in markets offers small farmers access to reliable customers.
- Innovation in agricultural techniques helps farmers increase productivity while preserving the environment – with approaches like no-till farming, rainwater harvesting, and drip irrigation.
- Innovation in foreign assistance assistance means that donors now support national plans that provide farming families with new seeds, tools, techniques and markets. This approach reduces overlap and keeps developing countries squarely in the lead.
A few months ago, Melinda and I visited a field research station of the International Rice Research Institute in Bihar, India. We wanted to talk to them about a project we fund called Stress Tolerant Rice for Africa and South Asia, or STRASA. The farmers are working with the breeders to get new high-yield varieties with tolerance for droughts, floods, and saltwater.
The farmers we talked to were all planting a variety called Swarna Sub 1 – which can survive up to 20 days underwater. One farmer told me he planted this new variety next to the old one he used to plant. When the rains flooded his fields for 10 days, the old variety was totally destroyed, while the new rice yielded more than three tons a hectare. That’s twice the yield farmers get from the old rice variety without floods. I asked them if this new crop saves them money in crop insurance, and they said they no longer buy the insurance. Their insurance is now in the flood-tolerant seeds.
This STRASA project has reached 400,000 rice farmers. But that’s just a start. Farmers have started hearing about these seeds, and they all want them. In the next six years, we expect 20 million farmers to plant these new varieties.
This new rice will prevent crop loss, reduce hunger, and boost the income of farming families. But this is not just one program – it comes from a range of investments and supportive government policies: basic academic research, applied crop research, and government systems to approve the seeds and have extension agents spread them. Each piece is essential. Together, they’re hugely successful.
Here’s the main point. What’s going on right now in Africa and South Asia is not a collection of anecdotes about improvements to a few people’s lives. This is the early stage of sweeping change for farming families in the poorest parts of the world. It’s an historic chance to help people and countries move from dependency to self-sufficiency – and fulfill the highest promise of foreign aid. In the past we’ve invested aid in Brazil and India and South Korea, and they are all now dynamic actors in the global economy – some even joining us in giving aid to others. This is our hope for the countries of Africa and South Asia as well.
Foreign assistance can also create a very direct financial return for U.S. citizens. For example, during a 25-year period in the late 1900s, the U.S. invested $134 million in wheat and rice improvement research to help alleviate poverty and hunger in the developing world. The new plant varieties developed from that research not only benefitted millions of poor farmers overseas, they also made their way on to American farms. From that original investment of $134 million, the U.S. economy realized a return of up to $14.7 billion in increased yields, lower production costs, as well as cheaper and better food for American consumers. That’s just the most visible benefit to the U.S. from agricultural research. There’s also the benefit of averting crop disease.
U.S. and Canadian wheat farmers lost 40 percent of their crop in the 1950s to wheat rust. Today, a form of rust called Ug99, first seen in Uganda, has spread up to the Middle East, down to South Africa, and is now threatening India. Our foundation has joined USAID, DFID, and others in funding research against this disease, but more funds are needed. It’s crucial for avoiding disaster, not just from this disease, but also from the ones to come.
Effective Foreign Assistance
The U.S. has a pivotal role to play in helping farming families lift themselves out of poverty and hunger. At the same time, we have a big budget deficit, and foreign assistance is always an easy target. So we need to tell people over and over why this spending is worth it – even in tight economic times.
First of all, we are investing in countries committed to change. In 2003, African heads of state pledged 10 percent of their national budgets to agriculture – with solid plans for achieving 6 percent annual growth. The countries taking the strongest actions are seeing striking benefits – with GDP rising, poverty rates dropping, and rural poverty rates dropping even more.
The African-led change is accelerated by the Alliance for a Green Revolution in Africa and the leadership of Kofi Annan. They’re offering farmers help with better seeds, healthy soils, access to markets, and better policies.
The second reason agricultural investments are worth it is that farming is a business. We’re working to give poor farmers business assistance through new tools and technology and access to markets and capital – and to let them work their way to self-sufficiency with the help of market forces. This approach has nothing to do with the old aid model of donors and recipients. This is about businesses and their investors.
One year ago, I joined Treasury Secretary Tim Geithner and the finance ministers of Spain, Canada, and South Korea to launch the Global Agricultural and Food Security Program.
This is an impressive fund. Before it makes a grant to a country, it looks at the nation’s plan. It studies the country’s track record. It wants to see that the government has smart sustainable policies designed to help farming families. Program leaders will meet next month and allocate more than $150 million to the countries with the strongest proposals.
The third reason agricultural development is a smart investment is that it is strikingly effective. In country after country, these approaches have improved the livelihoods of small farmers while reducing poverty and increasing economic growth. It’s proving the point again and again — helping poor farming families grow more crops and get them to market is the world’s single most powerful lever for reducing poverty and hunger.
Unfortunately, a great model and proven success is no guarantee of federal funding. Many of you know the story of the rise and fall of agricultural development in the 1970s and 80s. We had strong assistance from donor countries and expanding farm productivity in developing countries. We were on the road to success – then we declared victory and turned our attention to other issues. Experts said if we got out of the way, free markets would flourish. But the markets weren’t ready to flourish without assistance. Poor countries and poor farmers can become self-sufficient. But they first need support.
Let’s not lose our focus this time – the world can’t get better if we repeat past mistakes.
Call to action
I came here today to join those calling on the U.S. and other countries to fund agricultural development for poor farming families. I have to confess – I’ve never been a farmer. Until fairly recently, I rarely set foot on a farm. So it would be fair to ask why I’m so committed to supporting small farmers.
About five years ago, when I decided I would devote myself full time to philanthropy, Warren Buffett made his generous gift to our foundation. That gave Melinda and me both more time and money to devote to the work. So we were forced to think: in addition to our efforts in health, what’s the best way in the world to lift up the poorest?
Over the last five years, I’ve visited farming families in South Asia and Africa. I’ve seen their work, heard their stories, and studied the data. I’ve become convinced that supporting their efforts to grow more food and get it to market is one of the best possible ways to invest money – if you want to help the world’s poorest people become self-sufficient. That’s why our foundation invests in each of the programs I’ve named today.
Over the last five years, we have committed $1.7 billion to help farming families. It may sound like a lot – but against the need, it’s not. Ethiopia alone spends more than half of that every year from its own sources and from donors. The scale of the opportunity means no one can do it alone – it demands the full participation of donor countries and national governments.
It’s decision time for the United States. The U.S. has the resources, knowledge, and experience to help poor farmers grow their way to self-sufficiency. This renewed focus on agricultural development has been a truly bipartisan effort with commitment from the President and Congress and leadership from USAID and USDA among others. The President pledged $3.5 billion over three years to “Feed the Future.” Senator Richard Lugar has pressed this cause in the Senate, and U.S. leadership has helped draw $22 billion in commitments at the G8 and G20 summits.
Unfortunately, only about half these pledges have been disbursed or are on track to be disbursed. The budget deal in Congress included $100 million for the Global Agricultural and Food Security Program I just described. That is welcome funding at a difficult time, but it only brings total U.S. funding up to one-third of the commitment the U.S. made at the launch last year. If the U.S. fulfills its commitment, it will encourage other countries to fulfill theirs as well. One of the most promising recent events has been France’s decision to put food security at the top of the agenda for the G20 meeting this November. We need the G20 nations to make good on their commitments to small farmers. But it’s hard for us to urge them forward if we scale back.
Yes, we have to watch the deficit. But a fiscal crisis shouldn’t become a crisis of courage – and it should not force cuts in programs that pay huge returns. When the benefits are this clear, fiscal sanity means you spend the money.
This is smart spending. It can provide US farmers better crops – and better defense against diseases that threaten the world’s food supply. It can bring Africa and South Asia better seeds, new tools, and strong markets, as well as pave the way for economic growth and trade. It can help solve the problem of poverty and hunger. It can help feed 3 billion more people in the next 40 years. It can help move farmers and countries to self-sufficiency.
This cause advances U.S. interests. It also fulfills our ideals. As we support the work of farming families in Africa and South Asia, we’re affirming a vital part of our national character as Americans: our belief that we can and should build a better world. Thank you very much.