EJB Electronic Journal of Biotechnology ISSN: 0717-3458
© 2002 by Universidad Católica de Valparaíso -- Chile

Biotechnology Issues for Developing Economies

D. Gale Johnson
Office of Agricultural Economics Research
The University of Chicago


Tremendous progress has been made in improving the per capita food supplies in developing countries over the past three to four decades. This progress has been in terms of increasing the supply of calories per capita. The increase has been from less than 2000 in the early 1960s to approximately 2700 today. 

However, there are two negative aspects that need to be noted. First, while the overall impact of the Green Revolution on grain yields and output was highly favorable, the yield increases occurred primarily in areas of favorable soil and climatic conditions, especially on irrigated land. Large areas with limited rainfall saw very little gain from the new varieties. Second, while the caloric intake has improved significantly, many people, especially rural people, in developing countries continue to suffer from micronutrient deficiencies. We in the industrial world would suffer from such deficiencies, too, but for the fact that we consume large quantities of fortified food. Such foods include milk, flour, bread, salt, and breakfast cereals. Food fortification is not an answer to the problem of deficiencies such as of Vitamins A and D and iron and iodine when the majority of the calories of a family come from food that they produce themselves. Fortification becomes a viable solution only when most of the food is marketed and processed in modern establishments before it is consumed. 

Biotechnology can contribute significantly to overcoming each of these two negatives. It can be used to increase yields but perhaps more important it can be used to greatly improve the nutritional quality of raw food products, such as rice, wheat and potatoes, by adding to them certain micronutrients. As an example, providing adequate amounts of Vitamin A to children in developing countries would save large numbers from night blindness or actual blindness. It is estimated that in India 50,000 children become blind every year due to Vitamin A deficiency (Paarlberg, 2001). It would also reduce the seriousness of the outcomes of other diseases, such as diarrhea. A rice variety that includes significant amounts of Vitamin A, called by some Golden Rice, has been developed by a Swiss geneticist and should be available for distribution to farmers within less than a decade.

Developing countries face at least two major problems with genetically modified plants (GMOs). First, only a relatively few developing countries such as Brazil, China and India have the resources to invest in creating GMOs. The international agricultural research centers seem to be giving limited priority to the development of GMOs, apparently due to the objections of certain non governmental organizations (NGOs). Thus it may be difficult to arrange for the financing of the development of GMOs that will be best adapted to the conditions of many developing countries. Much of the investment in biotechnology for agriculture is being done by private firms. They are unlikely to undertake the expense of such research unless they see a positive profit potential. This is not said in criticism of the private firms engaging in such research and development but as a statement of fact. 

Second, a developing country that is exporting or hopes to export a particular product may well hesitate to approve a GMO seed variety for that product. The opposition to the import of GMOs by certain governments presents a major barrier to a developing country. Even if the opposition does not result in a ban on imports, it may impose conditions that developing countries either cannot meet or could meet only at a very high cost. If the importing country requires that a GMO variety be clearly identified in its movement from the farmer to ultimate consumer who may be thousands of kilometers away, the marketing systems of developing country are generally incapable of such an undertaking.

Consider the problem of the governments of either China or India being able to maintain control over GMO varieties from the producer to the port. Suppose the crop were wheat. In China there are more than 200 million households engaged in farming - assume that a third of them produced wheat - it is probably many more than that. The average area devoted to wheat would be one half hectare or less. The average output of wheat per farm would be 2.5 tons. Of this approximately half would be retained on the farm for seed and food so that sales per farm would be a little more than a ton. Assume that there was a GMO wheat variety grown by a third of all farms producing wheat. This would mean that more than 22 million farms would be producing that variety and each one would market somewhat more than a ton. Imagine, if you can, what the cost would be to identify the GMO variety and maintaining that identity until some part of the wheat were loaded on boat at a Chinese port. Or imagine what the cost would be if importing nations imposed barriers to the import of GMO wheat requiring a developing country such as India or China to maintain the identify of non-GMO wheat from the farm to foreign port. It is obvious that if importers require the positive identification of either GMO or non-GMO varieties from the producer to the consumer that developing countries will face enormous costs in exporting any food product if the country grows any GMO variety of that product. Not only will their ability to export a GMO variety be harmed but their ability to export non-GMO varieties as well. And this may well be the objective of some of those who oppose GMOs. 

China has invested more in the creation of GMO varieties than any other developing countries. Yet it has approved such varieties for only two of its major crops, namely tobacco and cotton. The GMO tobacco, which was virus resistant, has been withdrawn from commercialization because of opposition from an importer (Huang et al. 2002). The benefits of GMO cotton have been very great in terms of reducing the costs of production (Huang et al. 2002). The Bt cotton requires significantly fewer applications of pesticides. This reduces the cost of labor as well as the cost of pesticides. The Bt cotton also reduces the risk of illness from the application of the pesticides. There are distinct environmental advantages from the use of the GMO varieties.  

Why has China not approved the use of GMO varieties of wheat and rice? One reason is the concern over the implications for exports. As argued above, China's marketing system simply doesn't have the capacity to identify and trace shipments of grain from the farmer to the port. Thus to permit any GMO grain variety would make it nearly impossible for China to export any grain.

As noted the Green Revolution primarily benefited areas with adequate moisture or irrigated. Large areas of limited rainfall received little or no benefit. GMOs could benefit such areas in two ways: First, by creating plants that are resistant to pests or diseases and, second, by increasing yields for areas with adverse growing conditions, such as excess salinity. An example of the first possibility is a virus resistant sweat potato being developed in Kenya; much of the basic work was done by Monsanto which has made its work available without charge (Qaim, 2001). It is anticipated that the GMO sweat potato will reduce the costs of production by eliminating the use of some chemicals and would increase yields by 12 to 25 percent. The potential for helping the poorest of the farmers in developing countries is substantial - if the investment is made. 

I do not intend to downplay the food safety issues that might arise with GMO varieties. One major possibility is that of allergies. A particular gene may be introduced into a common product that has previously presented few allergy problems to consumers. But this is a relatively easy problem to detect or to prevent from the beginning. It is reasonably well known what products cause serious allergies, such as peanuts, and these sources will not be used as a source of genetic material. Obviously before a GMO variety is commercialized it needs to be tested to see if there are adverse health effects. But there will be argument about the length of time for the tests - the precautionary principle will be used to argue for years and years of tests. A skeptic could well argue that the objective of long periods of testing is not to improve food safety but to greatly reduce the incentives to develop GMO varieties in order to protect producers in high cost regions. 

What very few people know is that nearly all of us have been consuming GMO foods all of our lives and didn't know it. The major types of wheat - for bread and pasta - are each the results of crosses similar to what is done in creating GMOs. The difference is that the transfers of genes occurred thousands of years ago and were done by nature. I first heard this from Norman Borlaug. The study of DNA has made it possible to identify the sources of the genes.

It is a popular sport these days to bemoan the growth in income inequality that has occurred in recent decades. In my opinion the income inequality that exists pales into insignificance when compared to the inequality displayed in the political power of a very small number of individuals who dominate the NGOs compared to the political power of hundreds of millions of small and poor farmers who could gain if GMO varieties were available. A relative few are limiting the access of hundreds of millions of farmers to GMO varieties that could benefit them, not by a little but by a lot. The benefits are not only in terms of potential economic gain but also in terms of significant health benefits by reducing the use of pesticides and insecticides. In China only 4.7 percent of the farmers growing Bt cotton reported poisonings compared to 22 percent of the farmers who grew non-Bt cotton (Huang et al. 2002). The precautionary principle as applied by the opponents of GMOs look at only potential harmful effects while ignoring real benefits that accrue to the producers.     



HUANG, Jikun; ROZELLE, Scott; PRAY, Carl and WANG, Qinfang. Plant Biotechnology in China. Science, January 2002, vol. 295, no. 25,  p. 674-677.

PAARLBERG, Robert L. The Politics of Precaution: Genetically Modified Crops in Developing Countries.  Baltimore, The Johns Hopkins Press, 2001, p. 94.

QAIM, Martin. A prospective evaluation of biotechnology in semi-subsistence agriculture. Agricultural Economics, September 2001, vol. 25, nos. 2-3, p. 165-176.


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