The World Bank

Ministries Need to Collaborate to Ensure Continued Productivity of Farmland and Forests in ECA

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Source: The World Bank

As economies in the ECA region grow, farm and forest productivity will need to keep pace with rising consumer and industrial demand for food and wood.  But doing so by pushing natural resources beyond their limits can be disastrous.

Governments in the region have taken steps to address this issue, but they – ministries of environment in partnership with others such as agriculture, forestry and finance – need to think beyond legislation, policies and strategies to actual on-the-ground action.  This is the key message a World Bank delegation delivered at the Environment for Europe Ministerial Conference that took place in Belgrade from October 10 - 12.

A report titled ‘Integrating Environment into Agriculture and Forestry,’ was presented at the conference and indicates that agriculture and forestry are the main sources of income in rural areas, where over one third of the people in the region and 65 percent of the poor reside.  In total, agriculture and forestry contribute to 14 percent of the GDP in the region - much higher than the OECD average of 2.2 percent.

However, while these sectors contribute significantly to incomes in the region, they also can cause serious damage if not managed properly.

The agricultural and forestry sectors are collectively responsible for almost 60 percent of the nitrogen and 50 percent of the phosphorous that gets into the Baltic Sea.  The result of this excessive amount of nutrients entering the water stream is that plants grow and decay rapidly, leading to a lack of oxygen and severe reductions in water quality, fish and other animal populations.  This process, referred to as eutrophication, is estimated to have caused up to Euro 4.5 billion in damages.

Agricultural production and deforestation also account for up to 30 percent of greenhouse gas emissions, second only to the energy sector.

Looking at specific countries, the legacy of heavy pollution and diverting the Amu Darya and Syr Darya rivers for irrigation purposes in Kazakhstan during the Soviet era was a dramatic shrinkage in the northern parts of the Aral Sea, with the water body reduced to a fraction of its original size.  Similarly, an emphasis on food self-sufficiency in Albania during the socialist period led to cultivation of unsuitable land, which has exacerbated soil erosion and diminished forest areas.

While these problems are significant, greater productivity in the ECA region will only increase the environmental pressures on farms, pastures and forests.

At present, nutrient outflows from the EU15 countries are significantly higher than those from the EU8 or Russia. But this will change by 2015, when pig meat production is expected to increase by over 70 percent in the EU8 countries and poultry production is expected to increase by over 50 percent in Russia, leading to significant increases in manure.

Governments in ECA have taken significant steps to address these kinds of concerns.

Most countries have ratified key international conventions and National Environmental Action Plans have been adopted.  In some cases, these have been followed by sector action plans and pilot projects.

Kazakhstan and Uzbekistan are particularly notable for the pilot projects they have undertaken.  Kazakhstan has undertaken several projects to address land degradation, restore the northern Aral Sea and improve environmental conditions in the Syr Darya delta.  Consequently, water flow in the delta has increased, several freshwater fish species have returned and fish harvests are increasing.

Similarly, Uzbekistan undertook a project to replace chemical herbicides and pesticides with biological pest control methods.  In the 1980s, 12 kilos per hectare of herbicides and pesticides were being applied to crops, but through a World Bank funded Cotton Sector Project, predator insects (including 12 tons of wasps per year) were produced from 900 laboratories and distributed across Uzbek fields.  As a result, usage of chemical pesticides has reduced by 75 percent in the past five years and costs have gone down by 50 percent.

However, most Central Asian and Southeast European governments have not moved beyond framing policies and laws and undertaking pilot projects.

To overcome this, the World Bank team has put together a list of tasks that governments (and in support, IFIs and western countries) should work on.  Some of these are as follows:

  • Provide incentives (for example, payments) for individuals such as farmers who provide ‘environmental services’ like reducing erosion and preserving water quality by maintaining a vegetative cover on their land.   These kinds of services, which include carbon sequestration, rural landscape and watershed management, preserving biodiversity, are currently undervalued and unremunerated
  • Establish environmental monitoring systems so quantitative data can be gathered over time.  Ministries of environment particularly need to take the lead in this respect and also disseminate data (including economic cost-benefit analyses) to other ministries responsible for agriculture, forestry, finance and the economy as well as the general public
  • Establish effective agricultural advisory and extension services
  • Combine trade incentives in the West with rigorous certification of sustainable production in the East
  • Scale up pilot projects, which have otherwise been typically sponsored by external development agencies. An example is a World Bank project aimed at reducing salinity in Uzbekistan - which currently costs the country $1 billion per year - over an area of 100,000 hectares and enhancing wetlands.  This investment is expected to have high economic returns
  • Increase regional knowledge sharing
  • Proactively integrate climate change adaptation into agricultural and forestry sector policies, programs and investments

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