July 1995 Bilateral and multilateral donors significantly cut aid to agriculture in the 1980s and early 1990s.
Moves are currently under way in some industrialized countries to reduce foreign aid still further.
Although such cuts will undoubtedly retard economic growth and social development in developing countries, donor governments inevitably evaluate their foreign aid programs not only as altruistic activities, but also as political and economic investments. Reductions in support for aid to agriculture are often buttressed by the fears of some donor country producers, who believe that rising production in developing countries will take away export markets. Many studies show that publicly funded agricultural research increases agricultural productivity and growth. One recent study finds that the rate of return to agricultural research, in terms of the value of additional agricultural production, is generally two to three times higher than the return to other agricultural investments, which themselves compare favorably with other kinds of investments. Despite the high rates of return to investment in agriculture, many policymakers and economic experts have thought of agriculture as an isolated backwater.