Agricultural biotechnology-based (green) enterprise development for sustainable rural livelihoods and economic growth : opportunities with biofuel in selected Asian economies

Abstract

Biofuels have a long history of use in different parts of the world but they were always found to be expensive and inconsistent in their quality and supply. In the mean time, crude oil as an option is falling out of favour because of the continuous increase in the crude oil prices, its adverse environmental impact and the international commitment to the Kyoto Protocol. The situation has motivated a growing number of countries to implement &ldquo;bio-energy policies&rdquo;. In terms of energy-equivalence, there is no major difference between petrol and ethanol as 1 litre of petrol has the same energy content as 1.5 litre of ethanol. This has prompted keen interest in the development of biofuels across the world. On a global level, production of biofuel is spearheaded by Brazil and the United States followed by China. Currently, about 70 per cent of global ethanol production comes from Brazil and the United States. In these two countries, biofuels have become part of the national strategy for economic development with a sharper focus on agricultural development. Such transition is also the result of environmentally conscious initiatives, including the U.S. oxygenated fuels program. Recently, the EU has also launched a major programme on biofuels, enumerated in the EU Biofuels Directive for development and import of biofuels.&nbsp;<br /><br />The demand for biofuel is set to expand in the Asia-Pacific region, as more and more governments are establishing mandatory requirements for blending biofuels with gasoline. To some extent, this move is also a result of environment-based initiatives such as the Kyoto Protocol. Therefore, there is a need to launch Asia-specific forums to help developing economies to assess their own biofuel potential, work out local-specific programs and facilitate investment. These forums may also help promote intra-regional exchanges by sharing and learning from each country&rsquo;s experiences and overcome non-tariff barriers for their exports of biofuel-related and finished products. In this context, efforts should also be exerted to identify innovative financing mechanisms, such as loan guarantees and the Clean Development Mechanism (CDM). This, however, may be problematic with &ldquo;low-intensity&rdquo; biofuels such as rapeseed oil that iv Agricultural Biotechnology-based (Green) Enterprise Development require several chemical inputs and have relatively low energy yields. The new technological advances should be able to address such downside of biofuel production. At the regional/subregional level, joint efforts will ensure a proper quality of products are available for planting purposes. The non-prescription of standards for the jatropha seeds/seedlings have been useful for the new entrants allowing them to take advantage of the situation. Furthermore, a more pragmatic yet future oriented view has to be applied for the R&amp;D expenditure on biotechnology for biofuels development.&nbsp;</p> <p>Finally, there is a need to identify such opportunities for all the stakeholders to share the cost of advanced technology in biofuel development. This will eventually prove to be an important investment for the Asian region. In this study report, the specific country experiences of selected Asian economies are illustrated, including China, India, the Philippines, Malaysia, Republic of Korea and Thailand in terms of devising an initial framework for developing &ldquo;green&rdquo; enterprises for rural development through enhanced bio-energy production in a sustainable way. There are important lessons to be learned from the US and Brazilian experiences, largely in their overcoming the limitations of the first generation biofuels, while eyeing the second generation biofuels as a long-term strategy.</p>