Outlook and challenges for agriculture in the ASEAN region

OECD Global forum on Agriculture 3 May 2017 Paris, France Koen Deconinck, Agricultural Policy Analyst, OECD

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Organisation for Economic Co-operation and Development (OECD)

Southeast Asia has made remarkable progress on food security

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Africa Central AsiaCentral America East Asia Latin America Oceania Southeast Asia South Asia West Asia

% Prevalence of Undernourishment, 1990-2016

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www.oecd.org/tad Trade and Agriculture Directorate

Organisation for Economic Co-operation and Development (OECD)

High GDP growth in ASEAN countries is expected to continue

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Thailand Malaysia Philippines Indonesia Viet Nam … China EU15 OECD

2005-14 2015-24%

GDP growth rates, historical (2005-14) and projected (2015-24)

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Organisation for Economic Co-operation and Development (OECD)

In the medium term, world prices of agricultural commodities are expected to remain below peaks of last decade

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60

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100

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2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024

Index (2012-14=100)

Cereals Dairy Meat Oilseeds

Projected real prices for agricultural commodity groups, 2000-24

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Organisation for Economic Co-operation and Development (OECD)

Southeast Asian agriculture has seen strong production growth

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1961-69 1970-1979 1980-1989 1990-1999 2000-2009

Net production Net per capita production%

Annual agricultural production growth rates, by decade, 1960-2009

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Organisation for Economic Co-operation and Development (OECD)

Agricultural production growth will outpace rest of world

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Beef andveal

Coarsegrains

Proteinmeal

Poultrymeat

Pigmeat Roots andtubers

Sugar Fish Rice Vegetableoil

% ASEAN World

Total percentage production growth (2015-24)

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Organisation for Economic Co-operation and Development (OECD)

Productivity is increasingly driving agricultural growth

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1

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1961-70 1971-80 1981-90 1991-00 2001-12

Input TFP Output%

Composition of agricultural output growth in Southeast Asia, by decade

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Organisation for Economic Co-operation and Development (OECD)

Recent agricultural productivity growth rates in SEA are among the highest in the world

0 1 2 3

Sub-Saharan Africa (exc. South Africa)

Former Soviet Union and transition economies

OECD

World

North America

Latin America

North Africa and West Asia

Southeast Asia

Asia (exc. West Asia)

%

Agricultural total factor productivity growth, 2001-12

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Organisation for Economic Co-operation and Development (OECD)

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1

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1961 1967 1973 1979 1985 1991 1997 2003 2009 2015

Cambodia Indonesia Viet Nam ASEAN average

t/ha

Rice yields have also been growing steadily

Tonnes per hectare, 1961-2015

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Organisation for Economic Co-operation and Development (OECD)

ASEAN is a growing net exporter of food and increasingly regionally integrated in agri-food trade

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1996 1998 2000 2002 2004 2006 2008 2010 2012

USD Bn

Exports Imports Net

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1996 1998 2000 2002 2004 2006 2008 2010 2012

%

Intra-export share (RHS) Intra-import share (RHS)

ASEAN agri-food trade, 1996-2012 Share of intra-regional trade (%)

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Organisation for Economic Co-operation and Development (OECD)

In the long term, climate change is expected to have negative effects on production for all crops

-30 -20 -10 0 10

Bananas

Beans

Coffee

Cassava

Cocoa

Maize

Palm Oil

Rice

Teas

Vegetables

-40 -30 -20 -10 0 10

Bananas

Beans

Coffee

Cassava

Cocoa

Maize

Palm Oil

Rice

Teas

Vegetables

Percentage change in production in 2050 compared with no climate change

(a) Rain-fed crops (b) Irrigation-fed crops

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Organisation for Economic Co-operation and Development (OECD)

The negative impact of climate change will vary by country

Percentage change in rain-fed rice yields in 2050 compared with no climate change

Map included without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area.

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Organisation for Economic Co-operation and Development (OECD)

Climate change can have a large impact on prices by 2050 – this effect is compounded by domestic policies

0 20 40 60 80

Bananas

Beans

Cassava

Cocoa

Coffee

Maize

Palm Oil

Rice

Teas

Vegetables

0 20 40 60 80

Bananas

Beans

Cassava

Cocoa

Coffee

Maize

Palm Oil

Rice

Teas

Vegetables

Percentage change in prices in 2050 compared with no climate change

(a) World prices (b) ASEAN producer prices

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Organisation for Economic Co-operation and Development (OECD)

Summary: Outlook and Challenges

Southeast Asia’s agriculture is expected to continue its strong

growth in the medium term

In the long term, climate change will have a negative impact on production, unless action is taken on adaptation technologies

Productivity growth will be crucial, also given the pressure on land and other natural resources Improvements in the enabling environment Improvements in sustainable resource management

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