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AGRICULTURAL BIODIVERSITY AND BIOTECHNOLOGY IN ECONOMIC DEVELOPMENT NATURAL RESOURCE MANAGEMENT AND POLICY Editors: Ariel Dinar David Zilberman Rural Development Department Dept, of Agricultural and The World Bank Resource Economics 181 8 H Street, NW Univ. of California, Berkeley Washington, DC 20433 Berkeley, CA 94720 EDITORIAL STATEMENT There is a growing awareness to the role that natural resources such as water, land, forests and environmental amenities play in our lives. There are many competing uses for natural resources, and society is challenged to manage them for improving social well being. Furthermore, there may be dire consequences to natural resources mismanagement. Renewable resources such as water, land and the environment are linked, and decisions made with regard to one may affect the others. Policy and management of natural resources now require interdisciplinary approach including natural and social sciences to correctly address our society preferences. This series provides a collection of works containing most recent findings on economics, management and policy of renewable biological resources such as water, land, crop protection, sustainable agriculture, technology, and environmental health. It incorporates modem thinking and techniques of economics and management. Books in this series will incorporate knowledge and models of natural phenomena with economics and managerial decision frameworks to assess alternative options for managing natural resources and environment. While there are significant trends in use of genetic resources in agricultural research and its application, heated public debate has evolved around the biotechnology, biodiversity, and biosafety aspects. Acknowledging the potential of biotechnology tools and products for ending hunger and poverty in the developing world, it is also contended that genetic modification may poses unacceptable risks for human health and the environment. "Agricultural Biodiversity and Biotechnology in Economic Development" attempts at addressing such issues in a structured approach, using economic, legal and institutional frameworks. The Series Editors Recently Published Books in the Series Haddadin, Munther J. Diplomacy on the Jordan: International Conflict and Negotiated Resolution Renzetti, Steven The Economics of Water Demands Just, Richard E. and Pope, Rulon D. A Comprehensive Assessment of the Role of Risk in U.S. Agriculture Dinar, Ariel and Zilberman, David Economics of Water Resources: The Contributions of Dan Yaron ~nver,.~O.k~a.y , Gupta, Rajiv K. IAS, and Kibaroglu, Ay~egul Water Development and Poverty Reduction d'EstrCe, Tamra Pearson and Colby, Bonnie G. Braving the Currents: Evaluating Environmental Conflict Resolution in the River Basins of the American West AGRICULTURAL BIODIVERSITY AND BIOTECHNOLOGY IN ECONOMIC DEVELOPMENT by Joseph Cooper Leslie Marie Lipper David Zilberman Springer Library of Congress Cataloging-in-Publication Data Agricultural biodiversity and biotechnology in economic development / [edited] by Joseph Cooper, Leslie Marie Lipper, David Zilberman. p. cm. - (Natural resource management and policy ; 27) Includes bibliographical references and index. ISBN-10: 0-387-25407-2 (alk. paper) ISBN 13: 978-0387-25407-4 (HC) lSBN-10: 0-387-25408-0 (SC) ISBN-13: 978-0387-25408-0 (SC), E-ISBN-10: 0-387-25409-9 E-ISBN-13: 978-0387-25409-8 1. Agrobiodiversity. 2. Agricultural biotechnology. 3. Agrobiodiversity-Economic aspects. 4. Agricultural biotechnology-Economic aspects. I. Cooper, Joseph. 11. Lipper, Leslie. 111. Zilberman, David, 1947-IV. Series. O 2005 Springer Science+Business Media, Inc. All rights reserved. This work may not be translated or copied in whole or in part without the written permission of the publisher (Springer Science+Business Media, Inc., 233 Spring Street, New York, NY 10013, USA), except for brief excerpts in connection with reviews or scholarly analysis. Use in connection with any form of information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now know or hereafter developed is forbidden. The use in this publication of trade names, trademarks, service marks and similar terms, even if the are not identified as such, is not to be taken as an expression of opinion as to whether or not they are subject to proprietary rights. Printed in the United States of America. 9 8 7 6 5 4 3 2 1 SPIN 1 1395324 Contents .......................................................................... Foreword.. ix ............................................................. ... Acknowledgment.. ..xm PART I: Overview and Key Issues Introduction Agricultural Biodiversity and Biotechnology: Economic Issues and Framework for Analysis Joseph C. Cooper, Leslie Lipper, and David Zilberman Major Processes Shaping the Evolution of Agriculture, Biotechnology, and Biodiversity David Zilberman and Leslie Lipper Private Research and Public Goods: Implications of Biotechnology for Biodiversity Terri Raney and Prabhu Pingali PART 11: Genetic Resources and Biodiversity: Economic Valuation and Conservation The Economic Value of Genetic Diversity for Crop Improvement: Theory and Application R. David Simpson Managing Crop Biological Diversity on Farms Melinda Smale In Situ Conservation: Methods and Costs Detlef Virchow Understanding the Factors Driving on-Farm Crop Genetic Diversity: Empirical Evidence from Mexico Eric Van Dusen Costs of Conservation: National and International Roles Detlef Virchow Contents PART 111: Distributional Issues in the Management of 175 Plant Genetic Resources 9 The Sharing of Benefits from the Utilization of Plant 177 Genetic Resources for Food and Agriculture Joseph C. Cooper 10 Economic Criteria for the Multilateral Distribution of 197 Agricultural Biodiversity Conservation Funds Joseph C. Cooper 11 Modeling the Impacts of Bargaining Power in the 215 Multilateral Distribution of Agricultural Biodiversity Conservation Funds Frederic Chantreuil and Joseph C. Cooper PART IV: Biotechnology: Concepts, Values, and 233 Management 12 Agricultural Biotechnology: Concepts, Evolution, and 235 Applications Maria Jose' de 0. Zimmermann and Enrico Porceddu 13 The Potential of Biotechnology to Promote Agricultural 2.51 Development and Food Security Hoan T. Le 14 Impact of Biotechnology on Crop Genetic Diversity Matin Qaim, Cherisa Yarkin, and David Zilberman 15 Establishing Effective Intellectual Property Rights and 309 Reducing Barriers to Entry in Canadian Agricultural Biotechnology Research Derek Stovin and Peter W. B. Phillips Contents vii 16 Adoption of Biotechnology in Developing Countries 329 Holly Ameden, Matin Qaim, and David Zilberman PART V: Biodiversity, Biotechnology, and Development: 359 Policy Implications 17 Technological Change in Agriculture and Poverty 361 Reduction: The Potential Role of Biotechnology Alain de Janvry, Gregory Graff, Elisabeth Sadoulet, and David Zilberman 18 Towards An Intellectual Property Clearinghouse for 387 Agricultural Biotechnology Gregory Graff and David Zilberman 19 Policies to Promote the Conservation and Sustainable Use 405 of Agricultural Biodiversity Leslie Upper and David Zilberman 20 International Treaty on Plant Genetic Resources for Food 431 and Agriculture and Other International Agreements on Plant Genetic Resources and Related Biotechnologies Jose Esquinas-Alcdzar 21 Synthesis Chapter: Managing Plant Genetic Diversity and 457 Agricultural Biotechnology for Development Leslie Lipper, Joseph Cooper, and David Zilberman Author Index 478 Subject Index 489 Foreword The topics addressed in this book are of vital importance to the survival of humankind. Agricultural biodiversity, encompassing genetic diversity as well as human knowledge, is the base upon which agricultural production has been built, and protecting this resource is critical to ensuring the capacity of current and future generations to adapt to unforeseen challenges. Agricultural biodiversity underpins the productivity of all agricultural systems and is particularly important for poor and food-insecure farmers, who maintain highly diverse production systems in response to the marginal and risky production conditions they operate under. Understanding the importance of agricultural biodiversity in the livelihoods of the food insecure and enhancing its performance through the use of a variety of tools, including biotechnology, is a critically important issue in the world today, where over 800 million people have insufficient food to meet minimum needs. A strong theme that runs throughout the book is the importance of good public policy interventions to promote the provision of public goods associated with agricultural biodiversity conservation and directing biotechnology development to meet the needs of the poor. The book's primary innovation is that it describes the relationship between biotechnology and plant genetic diversity and puts these in the context of agricultural development. Both the conservation of plant genetic diversity and agricultural biotechnology have received extensive examination, but the linkages between the two have not, despite the apparently obvious relationship between the two. Biotechnologies, which cover a wide range of techniques and products, represent a valuable new tool for utilizing genetic resources. If applied with due precaution and risk analysis, they can increase the value of maintaining genetic diversity by reducing uncertainty about the characteristics and values of genetic resources. Biotechnology allows greater precision in the human manipulation of plant genetic resources, and even transfers of individual traits between species. However there are several potential risks associated with this technology and its application in agricultural development, which form an important part of the analysis presented in this volume. One controversy addressed in the book is the potential of genetically modified organisms (GMOs) to benefit poor agricultural producers in developing countries. Various aspects of the debate are x Foreword covered in this book, many of which were also discussed in the 2004 State of Food and Agriculture Report, which focused on the potential of biotechnology to meet the needs of the poor. Concerns about the risks associated with the technology are both technical and socioeconomic. There is uncertainty about the long-term impact of releasing transgenic species into existing gene pools and concern that irreversible and ultimately negative impacts may ensue. This uncertainty gives rise to the need for biosafety regulations which can be expensive and difficult to implement, particularly in developing countries with limited regulatory capacity. Increased privatization and concentration of agricultural research associated with the development of biotechnologies has also been raised as a potential problem, with fears of a loss of control of genetic resources on the part of farmers and developing countries. Against these concerns is weighed the evidence that transgenics can provide an effective means of addressing some of the most difficult and persistent problems in increasing agricultural productivity in developing countries, as well as a means of significantly reducing other environmental problems, especially those associated with pesticide use. Another controversial issue raised in this book is how best to approach the in situ conservation of plant genetic resources for food and agriculture. FA0 estimates that about three-quarters of the genetic diversity found in agricultural crops have been lost over the last century. Of 6,300 animal breeds, 1,350 are endangered or already extinct (Scherf, 2000). This rapidly diminishing gene pool is cause for great concern and a pressing need to design effective conservation strategies. Defining what should be conserved, its value to various groups in society as well as future generations, how much conservation is needed, where it should take place, and the most effective means of attaining it, are all controversial topics which are being debated today, and which several chapters in this book shed light on. A key issue raised is the relationship between in situ conservation and agricultural development. At present, the primary providers of in situ conservation are developing country farmers located in areas of high native diversity and who, in many cases, do not have the opportunity to adopt more homogenous utilization patterns of crop genetic resources because no suitable modern varieties have been developed to meet their conditions. These producers are likely to be the least cost sources of in situ conservation at present. However, is it fair and appropriate to rely upon their lack of access to improved genetic materials to provide cheap conservation in the future- at the expense of their own potential for productivity increases and improvements in their welfare? Developing strategies, which rely on diversity to achieve productivity and livelihood improvements, is one way to avoid this dilemma. Possible candidates for such strategies have been identified in the book; examples include broadening the genetic base of modern breeding programs, participatory plant breeding, and using biotechnology to insert important traits into traditional varieties.