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98 | Latin America and the Caribbean Report

Table 2-6. Growth Rates of Agricultural Production in Different Regions of LAC during the Period 1962-2001 (annual %).

Regions
Crops
Livestock
Average Growth
1962/1981
1982/2001
Average
1962/1981
1982/2001
Average
1962/1981
1982/2001
Average
Southern
Cone
2.79
2.98
2.89
1.74
2.95
2.34
2.97
2.96
2.62
Andean
2.43
2.65
2.54
3.95
2.92
3.44
3.19
2.79
2.99
Central
America
3.60
1.32
2.46
4.35
2.84
3.59
3.97
2.08
2.08 3.03
Caribbean
1.20
-0.71
0.24
2.78
0.77
1.78
1.99
0.03
1.01
Averages
2.55
1.57
2.06
3.56
2.38
2.97
3.05
1.98
2.51

Source: Días Ávila et al., 2006.

           In short, the political, fiscal and institutional crisis of the State in most LAC countries over the last two decades and the resultant reforms in macroeconomic, trade, and sectoral policies—including cuts in public investment in research and development—have created a less favorable context for promoting sustained growth in the value of agrifood production and a decline in the system’s capacity to address traditional demands. And this comes at a time when the new context calls for a change in Latin America and the Caribbean’s NARIs, in their institutional strategies, structure, and management models, so that they can fit into the global AKST system (Machado, 2004; Martínez, 2006).

2.3.2 AKST funding amounts, trends and consequences

Ardila (2006) underscores that public investment in agricultural research and development in most LAC countries was always low compared to international standards. It is a situation that has worsened in recent decades. Thus, while the ratio of research spending to GDP for the period 1970-75 in industrialized countries was around 2.5%, the average in LAC was 0.65%; and that ratio fell to 0.5% in 1975-85 and to a range of between 0.1 and 0.4% in 1985-95.

          According to Hertford et al., (2005), in the mid 1990s— the last date for which global figures can be compared internationally— a total of US$21.7 billion were spent worldwide on agricultural R&D. LAC countries spent US$1.95 billion (at 1993 international prices) or close to 8.8% of the world total. This was nearly double what those countries spent in 1976. However, there were great disparities. More than half the investment in agricultural research corresponded to Brazil. If Mexico is added, both countries accounted for nearly two-thirds of the region’s total. Other three countries spent over US$100 million annually. However, a significant number of countries spent US$16 million or less, resulting in a serious erosion and decline in the installed capacity of specialized institutions. Moreover, these have not been replaced by equivalent investments in the private sector.

           When one measures overall expenditure in agricultural research as a proportion of the share of GNP that corresponds to agriculture, in the mid 1990s in LAC the average was 1.12%, almost twice as much as was spent in 1976 (Table 2-6). However, great disparities persisted, from barely

  

0.13 in Guatemala to more than 1.7 in Brazil and Uruguay. These coefficients of agricultural research intensity in Brazil and Uruguay are far superior to those of most countries in the region, albeit far inferior to those recorded in industrialized countries, which on average spent 2.62% on such activities. Although funding from non-governmental organizations (mainly commodity producer organizations) doubled from 1976 to 1996, this increase started out from a very small base and undoubtedly continues to be insufficient to increase the poor intensity coefficients in the region.

          Other private research has not been able to reduce the gap. While in rich countries approximately half of all agricultural research is carried out by private firms, by the late 1990s, in LAC, total expenditures by the private sector in agricultural R&D amounted to no more that 4.4% of total expenditures,19 and with extreme asymmetries, since most of the private investment was carried out in Brazil. In Honduras, private research accounted for 7% of total agricultural R&D. In Panama, the figure reached 46%. Regardless, most private technologies used in the region are based on research carried out in industrialized nations.

          Even in those countries where public investment in agricultural R&D increased in the first half of the 1990s, recovery was fragile. Investment was greatest in Brazil and Colombia, but suffered cutbacks in the second half of the
decade. In the region’s smallest countries, research activity has experienced no growth whatsoever, revealing an asymmetry between richer and smaller countries that left the latter lagging behind.

          At present, only a handful of countries—Brazil, Mexico, Argentina, Colombia, and Venezuela—can boast of important organizations that have kept up significant levels of investment.

2.3.3 Consequences of reduced financing
In LAC, when analyzing the 1981-2002 period (Figure 2-2 and Table 2-7), a negative evolution in public research can be detected vis-à-vis industrialized nations. In the least devel-

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19 R&D investments are measured on the basis of where they are carried out, regardless of where the company’s headquarters may be located.
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