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Environment & Poverty Times No. 5

Biofuels, land use, and sustainable development in Asia and Africa

Powering development

Energy is at the heart of development. Energy is needed at the household level, for communications and for industrial processes. Developing countries are gearing up to meet their needs for electrification and fuel. At the same time the fight against climate change offers opportunities for low-carbon economies.

By Francis X. Johnson, Yong Chen, and Fiona Zuzarte, Stockholm Environment Institute

Agricultural reform, climate change and energy security have been key drivers in renewed enthusiasm for biofuels; the production of biofuels has also been seen as providing stimulus for the economic revitalisation of agriculturally unproductive rural areas both in developing and developed countries. At the same time, the rapidly growing demand for biofuels has raised concerns about food security and environmental impacts. Media coverage has tended to polarise the debate over biofuels, making it more difficult to reach balanced judgements. In order to make sound decisions, policy makers need to have a full grasp of the scientific facts – the direction of policy should not be based on hasty generalisations.

At present, the amount of land devoted to growing biofuels worldwide is less than 25 million hectares, which is about 0.5 per cent of the 5 billion hectares of global agricultural land. Conflicts over land use, in relation to biofuels, have not yet reached significant proportions, though it is important to improve scientific analysis now so that such conflicts do not become widespread in the future. Nor is the production of biofuels a major factor behind global food price increases or land degradation. Yet this does not mean that biofuels will not cause such problems in the future, particularly if production expands into ecologically sensitive regions. Furthermore, the twin pressures of an increasing global population and the rapidly rising cost of fossil fuels will inevitably lead to more land use demand, since renewable resources require more land than the non-renewable fossil fuels they replace.

The global distribution of available agricultural land is rather uneven with respect to population. In general, it’s likely there will be more land pressures in Asia in the future – which means the region as a whole will have fewer options available for the production of biofuels. In terms of regions and the potential for the bioenergy trade, it seems likely that only Latin America and areas of sub-Saharan Africa have the potential to become major biofuel exporters. Some sparsely populated regions of Asia also have significant biofuel potential. There are also very large tracts of forests in Canada and Siberia that could serve as feedstocks for biofuels, but these regions tend to be economically remote and environmentally sensitive.

The high productivity of biomass in tropical and sub-tropical regions, in combination with low labour costs, means that developing countries have a comparative advantage in biofuels as well as in agriculture more generally. Many Least Developed Countries (LDCs) in sub-Saharan Africa have especially high potential due to their lower population density. This comparative advantage has been compromised considerably by the lavish agricultural subsidies that have been used in many high income (OECD) countries, which have – until recently – depressed food prices and discouraged investment in agriculture in LDCs.

Levels of cultivated land per capita have been dropping in fast-growing economies like China where the figure is now 0.12 hectare – about half the world average. In a major agricultural exporting country such as the US, the figure is five times this amount, while within the EU it’s about twice the amount. In a fairer trade regime, these higher levels of cultivation would be reduced while cultivation would increase in developing countries, both for food and fuel. The resulting increased investment for food and fuel production in LDCs could promote modernisation and reform of the agricultural sector, and act as a spring board for more economic opportunities.

Whether or not such economic development, derived from improved economic competitiveness in the agricultural sector, will bring poverty reduction and sustainable development to the LDCs will nevertheless depend on many other factors, including land tenure, property rights, resource allocation, credit access and transport infrastructure. As with many other economic development issues, there are many different strategies for expanding biofuels production, some being much more sustainable and equitable than others. It is up to researchers and analysts to evaluate the alternatives that are feasible: it is then up to the policy-makers to carefully weigh the advantages and disadvantages of the options.

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(Photo: UNEP/Bert Wiklund)

World Poverty DistributionAgricultural potential – as land use per capita, for selected countries and regions

The amount of land area available per capita provides a rough measure of the current carrying capacity for food security and for the development of additional agricultural products for export – such as biofuels. The calculations presented in this figure show that most of Asia is very limited in this respect, especially since populations are expected to increase. Latin America and parts of Sub-Saharan Africa show more potential for the development of biofuels for export.