By 2050, an estimated 60% of the ASEAN region’s population will be living in cities. Home to 13 of the world’s 22 megacities, and an expected 20 megacities by 2025,1 ASEAN’s rapidly growing urban population is placing enormous demands on food systems. The combination of population growth and urban sprawl is already causing concerns about future food security. By 2050, agribusiness productivity must increase 70% to meet the growing demand for food.
The World Bank estimates that growth in agriculture is two to four times more powerful at reducing poverty than growth in other sectors. With an estimated 36 million people in the region living below the poverty line, this presents a tremendous opportunity for social and economic development driven by the ASEAN agribusiness sector. It is also good news for investors, as the region’s balanced climate, fertile lands, and mix of naturally abundant geography make it highly suited to food production. Investors are likely to find opportunities not just in crop and livestock production, but also in managing food supply chains, agriculture infrastructure and safety, and food storage and quality assurance.2 Despite being leading producers of staple crops and food, most ASEAN countries have yet to reach their full production potential. ASEAN’s rapidly growing cities must also consider the resilience of their food supply, a risk that has been largely overlooked in favour of the pursuit of economic growth.
Cities are expanding into fertile land, while the food needs of the urban population are increasing. Agriculture and cities are competing for natural resources, particularly water.3 Additionally, the further cities are from cultivated fields, the higher transportation and storage costs4 become, which increase the price of food for consumers. Industrialization and rapid, uncoordinated urbanization in large cities is also taking a toll5 on both human health and the environment, leading to increased risks of pandemics, food and water insecurity, and climate change related disasters. Ultimately, unchecked urban growth will exacerbate the impacts of climate change while contributing to food deserts and food insecurity, especially for the urban poor. Food and water insecurity are compounded by climate change and extreme weather events, and have already led to increasing risk of shortages and food safety scandals.
The substantial development of urban areas that will take place over the next three decades provides the region with opportunities to leapfrog to greener and more resilient urban planning and infrastructure in smart cities.6
While family farms in rural areas still produce 80% of the world’s food, current trends have seen agriculture – including horticulture, livestock, fisheries, forestry, and milk production – increasingly incorporated into towns and cities and their peripheries. Urban and peri-urban agriculture (the growing of plants and the raising of animals within and around cities) can provide fresh food, generate employment, recycle urban organic waste, create greenbelts, and strengthen cities’ resilience to climate change.7 Urban agriculture improves food security for the urban poor by increasing food access to growing urban populations. In addition to catering to growing demand for food, urban agriculture also increases resource efficiency, improves the economic independence of women, and may help to mitigate climate change.8
Promoting innovation that leads to higher productivity is essential to ensuring productive and sustainable agriculture. In the long run, productivity growth in agriculture requires continuous technological progress, as well as social innovation and new business and investment models.9 The agribusiness sector can create financial value by endorsing innovative and new products and services, while also address pressing social and developmental challenges facing ASEAN’s rapidly growing cities.
Indeed, there is a global need for businesses to adopt a more sustainable strategy for this type of collaborative and inclusive growth. It is becoming increasingly important for companies to demonstrate how their business helps advance sustainable development, by both minimizing negative impacts and maximizing positive impacts on people and the planet. Using their resources, capabilities, and creativity in delivering real solutions to global challenges, the agribusiness sector is well positioned to take a lead in solving several global challenges, as elaborated in the 2030 Sustainable Development Agenda (the SDGs). A well-performing and smartly regulated agribusiness sector that can cater to rising food demands, can also help fast-track national efforts to achieve SDG1 (no poverty) and SDG2 (zero hunger).10 It can also help achieve SDG 11 and make cities and human settlements inclusive, safe, resilient and sustainable by investing in sustainable infrastructure in urban farming areas and promote better land use practices to manage farmland while connecting urban farmers to regional supply chains and offering training and better equipment. Most urban agriculture is currently small-scale and yields are low, but productivity could increase significantly through improved agribusiness-driven promotion of rural-urban linkages and by rethinking where and how food is grown, processed and sold. Taking the lead on initiatives to improve the resilience of food systems in cities, as well as promoting urban health, water quality and wastewater management, nutrition, and humanitarian responses to crisis in urban areas will also benefit the sector.
A global economy that better serves society and evolves within the natural resource limitations of the planet is the only way to ensure that the SDGs are met by 2030. By that time, most people will live in cities and have little to no first-hand knowledge or access to the food they eat. This broken link will affect the poorest first – those who may not be able to accommodate fluctuating food prices or access a stable supply of food. With the impact of social inequalities heightened in densely populated cities, businesses and policies makers must urgently consider the importance of building resilient food systems for ASEAN’s megacities, to promote stable, inclusive and sustainable growth.
To learn more about the role of agribusiness in this pursuit, visit the CSR Asia website and read our report on Agribusiness and the SDGs: How the Agribusiness Sector in ASEAN can embrace the Sustainable Development Goals.
Photo: Courtesy of Christopher DeWolf, Slate Magazine