Journal Issue

Biotechnology and the Developing World

International Monetary Fund. External Relations Dept.
Published Date:
January 1992
  • ShareShare
Show Summary Details

Finding ways to bridge the agricultural technology gap

As countries all over the world confront the need to dramatically boost agricultural output, biotechnology—which comprises techniques for using plants, animals, and microbes to produce useful substances or improve existing species—stands out as a promising tool. These techniques, ranging from basic tissue culture to advanced genetic and molecular manipulation of biological material, hold out the possibility of relieving the present biological constraints on agricultural production. This can be done through improving the tolerance of crops and animals to particular physical stresses (e.g., salinity and drought), pests, and pathogens, and through increasing nutrient efficiency.

Exactly how much modern biotechnology can or cannot do—especially for the developing countries—is still an unanswered question. Indeed, during the last few years, there has been an intense debate among supporters and critics alike, with some touting recent developments as the next “Green Revolution”—that is, a “gene revolution”—while others have warned against a possible erosion of genetic resources. Other prickly issues include intellectual property rights (the patenting and legal ownership of discoveries involving living organisms) and biosafety (the testing and release of genetically altered plant varieties in farmers’ fields).

Up to this point, most biotechnology research has taken place in the industrialized countries, concentrating on applications of interest to the developed world. But in recent years, developing countries have become more active in the field, sensing that this type of research holds potential benefits for them, too. This notion was in fact validated by a major study in 1988-90 by the World Bank, the International Service for National Agricultural Research, and the Australian government. It concluded that there were many potential benefits from integrating modern biotechnology with conventional agricultural research, and from focusing significant public sector investments on the “orphan commodities”—crops traditionally of less interest to the industrialized countries but of great importance to the vast numbers of resource-poor producers and consumers in the developing world.

For further information on this topic, please refer to “Agricultural Biotechnology: Opportunities for International Development,” edited by Gabrielle J. Persley, and World Bank Technical Paper Number 133, “Agricultural Biotechnology: The Next ‘Green Revolution’?”

So what is the problem? Unlike earlier agricultural advances, such as the Green Revolution, most biotech research and development tends to be concentrated in the private sector. This means that secrecy and stockholders play vital roles in the development of new products, which then in turn are often protected by patents. In addition, the stakes of biotech research are quite high. Firms typically must make large initial outlays, only to wait some 10 to 15 years before the products are even developed and released. As a result, developing countries increasingly fear that they will not have access to the new techniques and products. They also worry that they will lack both sufficiently trained personnel and the necessary infrastructure to even implement the new research strategies. This article takes a look at this dilemma, focusing on how one public sector group—the Consultative Group on International Agricultural Research (CGIAR)—can help.

Who is investing

For industrial countries, modern biotechnology is no longer new. It was first used commercially in the United States in the mid-1970s, and by 1990, estimated total research and development in biotechnology worldwide reached approximately $11 billion dollars, with about two thirds accounted for by the private sector. Although the field was originally dominated by medical applications, animal and crop production have been taking on increased importance. Current research in animals focuses on vaccine development and improving the productivity of farm animals—for example, treating cows with supplemental bovine somatotropin (BST), a natural protein hormone manufactured through recombinant DNA technology (the basic thread of life in all living systems) to increase milk production. Furthermore, it has become a relatively common practice to use genetic engineering to identify and transfer single genes for desired traits into certain plants, thereby offering biotechnological alternatives to chemicals for the control of insects, weeds, and diseases.

In the developing world, however, the state of biotechnology varies greatly, with most countries falling into one of two groups: those with the potential to adapt imported biotechnologies to local conditions, or those with very little or no applied research capacity to exploit imported biotechnologies. Only a few—notably Brazil, China, India, and Thailand—currently enjoy a capacity to develop and export biotechnologies, largely because of concerted efforts among their policymakers and scientists to develop national biotechnology policies. Yet even these countries face some rather serious barriers:

  • A shortage of investment capital inhibits both product development and the capacity to supply the market. In Thailand, for example, the Government continues to import a special enzyme used in diagnostic testing (for pregnancy and biochemical analysis), despite the fact that one of the key ingredients, peroxidase, can be obtained from the horseradish plant, which is abundant locally. The problem, quite simply, is a lack of venture capital.

  • There is a lack of trained scientists who can combine biotechnology with conventional breeding practices.

  • In the eyes of some, progress in agricultural biotechnology in the industrial countries may erode Third World income sources. Specific concerns revolve around the displacement of traditional export crops and hard currency earnings. Although not an outcome of modern biotechnology, the development of sugar substitutes is often used as an example of technological progress leading to loss of export markets for the developing world. In other cases, such as the production of vanilla in tissue culture, developing country incomes are threatened, as synthetic substitutes displace traditional means of production.

Public versus private

Despite these barriers, it is clear that biotechnology research holds enormous promise for the developing world. But to what extent will these countries be able to take advantage of the research benefits? The answer most probably lies in the ability of these countries to become part of the public-private nexus that sprang up in the United States and Europe in the 1980s—a dramatic change from the international public research effort that brought the world the high-yielding rice and wheat varieties of the 1960s.

The new emphasis is on public and private universities collaborating with private companies in the area of product development—something that has existed in other areas of agricultural research for quite some time. This has been facilitated by changes in US patent laws that have made it possible for companies to make a profit on their investments in the public arena. As a result, a new division of labor has emerged. More and more, public institutions and universities are focusing on the basic aspects of research, leaving product development and dissemination in the hands of private firms. One promising prototype is a recent agreement worked out between scientists at Washington University in Missouri and a large US agrochemical company, Monsanto. The private company, which provided financial support for the virus resistance research, now has a patent on the new gene that was developed, while the primary scientist has been granted licensing rights for the release of the gene into cassava and rice in developing countries.

Besides the universities, international lending agencies, including the World Bank, have also become part of this cooperative effort. For some, the involvement takes the form of international initiatives, such as one launched by the UN Food and Agriculture Organization (FAO) to retain the rights of farmers in the development of new agricultural varieties. For others, such as the Bank, new responsibilities take the form of increased investment in human capital and infrastructure development to advance science and technology programs. It is difficult to estimate the Bank’s total financial outlay for biotechnology, as these activities fall within lending programs for agriculture, education, and science and technology. Even so, many projects include a biotechnology component, and since 1982, these have amounted to about $97 million. In fiscal years 1990 and 1991, three projects were funded in Argentina, Bolivia, and Senegal, with biotechnology components totaling $3.7 million, about 5 percent of the total lending for these projects.

As new partnerships emerge, care must be taken to continue the development of biotechnologies for the less commercially attractive but vitally important food crops unique to developing countries. At this stage, it is difficult to know how the privatization of certain products or specific biological changes in plants and animals will affect food production in the developing world. But ethics and equity demand that the gene revolution enhance—rather than erode—the opportunities for resource-poor producers.

How CGIAR can help

The CGIAR believes it can help in two fundamental ways: by providing a bridge for the flow of needed information and germplasm (seed and plant material) between developed and developing countries, and by ensuring that the agricultural needs of the developing countries are not lost (given that there would be little money to be made by private firms in the improvement of orphan commodities). Its overall strategy is to draw on tested biotechnology techniques from advanced research laboratories, applying them to existing research activities, rather than undertaking innovative biotechnology research themselves. The integration of biotechnology with conventional research is crucial to the CGIAR role in the sustainable improvement of agricultural productivity in developing countries.

At present, the scale of CGIAR biotechnology research is modest—especially compared with that of the private sector—and no doubt will remain so. In 1990, for example, CGIAR plant and animal biotechnology research totaled $14.5 million. This was less than 5 percent of the total CGIAR budget and only a fraction of the $55 million spent on agricultural biotechnology by Monsanto alone. Half of the CGIAR outlay on biotechnology went to plant research, distributed across nine crop improvement centers working on 15 crops. The other half went to animal research, primarily at the International Laboratory for Research on Animal Diseases, in Nairobi. This center focuses exclusively on state-of-the-art molecular biology for the elimination of two major livestock diseases: tick-transmitted East Coast Fever and tse-tse fly-transmitted African sleeping sickness (trypanosomiasis).

Networks. Faced with these cost limitations, CGIAR realizes that one of the best ways it can help disseminate information is through building on its established network system—essentially associations of independent individuals or institutions that share a common goal—which it uses to pass on useful research techniques to national systems.

The first biotechnology network was established in 1985 with major assistance from the Rockefeller Foundation. It links advanced laboratories in Japan, Europe, the United States and Australia with two CGIAR centers: the International Rice Research Institute in the Philippines and the Centro Internacional de Agricultura Tropical (CIAT) in Colombia. This network uses advanced biotechnology techniques in the development of molecular maps to help breeders determine whether individual rice plants contain useful genes. Many such genes have already been cloned from rice, including the gene “oryzacystatin,” an inhibitor of the digestive enzymes of insect pests.

Another advanced research network is the Cassava Biotechnology Network involving CIAT, the International Institute for Tropical Agriculture, and scientists in Latin America, Africa, Europe, and the United States. This network, supported by the Government of the Netherlands, focuses on unlocking the problems associated with cassava biochemistry via molecular research. Biotechnology will be supplemented by farming systems studies to assist in removing the effects of cyanide in cassava for increased farmer acceptance. Research on cassava and other crops included in the category of orphan commodities is especially important, as many of the world’s small farmers depend heavily on these crops for food and income.

Training and institution building. A second way of diffusing research technology is through training and institution building. Between 1985 and 1989, CGIAR-supported centers (there are 17) conducted training courses, mainly lasting two to four weeks, to an estimated 25,000 developing country scientists in all areas of crop and livestock improvement. In addition, research fellowships in biotechnology have been offered at several centers.

On the institutional side, the centers are increasingly being asked by national agencies to help set up creative programs that often have a biotechnology component. In 1986, for example, the Andean Development Bank (CAF—Corporation Andina de Fomento) asked the centers in the Latin American region to assist in some of the activities of its recently created biotech program. In response, the Centro Internacional de la Papa (CIP) began to work with the CAF on projects in five Andean countries (Peru, Bolivia, Ecuador, Colombia and Venezuela), which range from using tissue culture for disease-free material to in vitro potato seed production to facilitate the transport of planting materials to remote areas.

A look ahead

The CGIAR is well-positioned to help disseminate appropriate biotechnologies to developing country agricultural research. As biotechnology progresses, greater knowledge and more precise tools for agricultural research will help reduce uncertainty about the future potential of biotech products for developing countries. At the same time, however, there will be a greater need for global monitoring of research advancements. It is increasingly clear that isolated research will not bring the changes needed for the next century, meaning that international collaboration will be essential. In the process, countries will have to come to grips with two critical issues that are taking on increased importance with the advances made in biotechnology.

Biosafety. As plants produced from genetic engineering techniques are tested and released, the ability to ensure environmental safety and public health is shaping up to be a critical issue. Already, private sector companies have tried dodging stringent regulations in developed countries by field testing in developing countries. This means that developing countries—where most of these crops originated—must quickly develop strict biosafety regulations. The international research centers have established special committees within their institutions to prepare for the testing of genetically improved material. Following the international guidelines set by the Organization for Economic Cooperation and Development, they work closely with host countries in determining proper risk analysis for the testing of genetically engineered plant material.

Intellectual property management. The need to preserve future biodiversity has been, and continues to be, a top priority for the CGIAR. Over the years, several of the centers have collected germplasm from countries worldwide for their mandated crops, often using the material to reestablish individual country collections (e.g., because of political unrest). In fact, the sole purpose of one center—the International Board for Plant Genetic Resources (IBPGR) in Rome—is to promote germplasm conservation.

The CGIAR has always operated an “open door” policy—meaning all clients, whether public or private, in the developed or developing countries, can enjoy access to the germplasm. But the involvement of the private sector in biotech research is raising serious questions about both the access of developing countries to new biotechnologies and the extent to which research will benefit resource-poor farmers. Developing countries seem to be faced with two possible scenarios, neither of which is entirely acceptable. They can either protect intellectual property rights, thereby obtaining access to the latest crop technologies, which may lead to taxing farmers with seed cost. Or they can choose to save foreign exchange and protect farmers’ income, but risk being left behind.

As the developing countries begin negotiating these touchy issues with the private sector, they hold one valuable asset—the germplasm originating from their land and shared with CGIAR. Indeed, these collections will increase in value as biotechnology expands and the genes contained in the seed material gain importance for the global research community.

To date, the centers involved with crop commodities have chosen not to patent their discoveries. But they will eventually have to consider negotiating for the use of proprietary technologies. This might mean purchasing the rights to use a certain technique or product of biotechnology, such as a virus resistant gene, to make it available for use by its developing country partners. Assuming the use of these products does not interfere with traditional markets—based in Europe or the United States—industrial country companies could, by this method, share their goods with the developing world.

Kerri Wright Platais and Michael P. Collinson

Other Resources Citing This Publication