Funding at a glance

The 10 governments and agencies that provided the largest share of our funding in 2002 are shown in Figure 1. The contributions to CIMMYT’s budget by CGIAR member countries, North and South, as well as foundations and advanced research institutes (public and private), are presented in Figure 2.

Sources of income from grants are presented in Table 1. Targeted funding continues to provide almost two-thirds of CIMMYT’s research resources (Figure 3). We fully expect that the trend for core unrestricted funding to decline in relation to targeted contributions will continue to provide challenges for managing research and financing the research agenda. Full costing of projects will be more important than ever, along with the recovery of all direct and indirect costs. Indirect cost recovery is currently just less than 13%.

Funding in 2002

Total funding for 2002 was US$ 35.806 million (including other income and overhead recovery); of this funding, 81% came from CGIAR investors and 19% from other sources. Expenditures were US$ 43.933 million. The largerthan- anticipated deficit for 2002 is the outcome of unexpected funding decisions and compliance with a recommendation from our auditors to take a more prudent approach to writing off unfulfilled pledges from donors. The deficit for 2002 comprised an operating loss of US$ 1.441 million (including staff reduction costs of US$ 1.193 million) in addition to US$ 2.312 million in write-offs of unfulfilled pledges from previous years and audit adjustments.

To strengthen financial management at CIMMYT, particular attention has been given to guarding against exchange rate losses through the use of more conservative exchange rate forecasts. The Center has implemented a more thorough and stringent review of unpaid funds to avoid multi-year accumulation of bad debts. It has also taken a much more conservative approach to budgeting activities funded by core unrestricted and core restricted contributions.

Prospects for 2003-2004

The revised budget estimate for 2003 is US$ 38.8 million. Through more conservative financial management and vigorous efforts to raise additional income, CIMMYT expects to increase its working capital reserves by more than US$ 1 million by the end of 2003. The Center has embarked upon a concerted effort to raise working capital reserves to the level of 90 days by the end of 2007. Staff reductions over the past 16 months—voluntary and involuntary—have been undertaken to provide a more flexible cost structure while maintaining core competencies.

The funding landscape will also be transformed as the CGIAR Challenge Programs and other funding mechanisms come into play, and as various donors alter their CGIAR investment strategies. CIMMYT expects that participation in the CGIAR Challenge Programs will somewhat offset changes to the general support allocations of the World Bank and other donors. We also anticipate that the introduction of performance-based funding allocations will enable CIMMYT to continue to pursue science that is based on excellence and relevance for developing countries.

In late 2003, CIMMYT anticipates that it will embark upon a new phase with the implementation of its new long-term strategy. A well-articulated strategy that is reflected clearly in CIMMYT's new project and financing plans will more clearly hightlight the range of activities that CIMMYT pursues to benefit poor farmers and consumers in developing countries.

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February, 2004