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This is the fourth summary of the growth and poverty discussion group
including messages from May 8 to May 19. This has been an especially busy
period with more contributions posted than the three previous weeks
combined. Although there have been a huge number of contributions, the
debate has been focussed on a limited of threads:
1) The broad relationships between agriculture, growth and poverty,
including discussion of gender and food security dimensions.
2) Alternative strategies for agriculture and poverty reduction
(cereals-based intensification, small farm vs large farm strategies, low
external input agriculture (LEIA) vs high external input agriculture)
3) Trends in agricultural development, including urbanisation and links with
the urban economy, technological innovation and environmental change and the
livestock revolution.
4) The political dimension of agriculture
5) The priority of agriculture within DFID, and how DFID needs to change.
Because of the huge volume of material I have decided to split this summary
into two more easily digestible parts. The first part will deal with the
above points 1 and 2, and the second part will deal with points 3 to 5.
**************
1) Agriculture, growth and poverty
1.1 Agricultural growth and the displacement of labour
Several contributors this week have suggested that economic growth is
normally associated with the displacement of labour out of the agricultural
sector into non-farm sectors. Dirk Bezemer (13 May) identifies two
essential conditions for growth: (i) agriculture must become more
productive, needing less labour per output, and (ii) non-agricultural
opportunities must open up so that the labour released from agriculture can
be used even more productively.
Other contributors have made similar points about the displacement of labour
from agriculture. James Biscoe (15 May) states that the key condition for
growth is that agriculture should become more productive and profitable in
order to free up resources to be used in other sectors of the economy. Dick
Tinsley (13 May) supports this by pointing to the declining share of
household expenditure on food items as incomes increase. Jim Kinsella (13
May) states that "historically, economic development that is successful in
GDP per capita terms has invariably implied falling rural population shares,
falling shares of employment in agriculture, and a falling share of
agriculture in GDP."
The general view amongst the discussion group appears to be that the
movement of labour out of the agricultural sector is a normal part of the
development process. However, there does appear to be a concern that this
transition should be managed carefully to avoid social and political
upheaval (see section on urbanisation below). Much depends on the terms
under which people move out of agriculture. Are there reasonable formal or
informal non-farm or urban alternatives? The diversification of livelihood
sources is mostly desirable from the perspective of raising and stabilising
incomes. However, as Laurent Chazée has pointed out using an example from
Nepal, non-farm employment may sometimes be an act of desperation reflecting
the inability to make a decent living out of farming.
Another general point emerging from the discussions is that the transition
out of agriculture is context specific. For example, the difference between
rainfed and irrigated agricultural systems is explored in John Dixon's
contribution (14 May). Dirk Bezemer (13 May) argues that non-farm growth is
the main priority in South Asia, where the Green Revolution has already
delivered agricultural productivity gains. However, in Sub-Saharan Africa
raising the productivity of agriculture is the immediate challenge. In
considering the diversity of these processes, several contributors have
identified intermediate stages in the transition out of agriculture.
Several contributors emphasise the importance of multiple livelihood
strategies in rural areas, and Diana Lee-Smith has pointed to the growing
importance of urban and peri-urban farming.
Moving the discussion forward. A common argument running through many of
these contributions is that we need to think about farming in broad terms
(i.e. intersectoral and urban-rural linkages, broad livelihood strategies)
rather than just as a sector. The livelihoods approach appears to be
broadly validated as a way of thinking about what is important for poverty
reduction. In moving the debate forward I think that it would be
interesting to explore the implications of these perspectives for government
and donor policy. Should interventions be designed on sectoral lines, or
are multisectoral programmes needed? How should donors and governments
address broad structural shifts in the economy? Should donors and
governments attempt to manage such transitions, and, if so, how? What are
the implications for public resource allocation? How can we argue that
agriculture deserves greater investment in situations where its share of GDP
and employment is declining?
1.2 Agriculture and pro-poor growth
Clive Robinson (8 May) and Rutchi Tripathi (13 May) have argued that growth
may not necessarily result in poverty reduction. Furthermore, 'growth first
' strategies may not be sufficient to reduce hunger. They call for
strategies aiming to tackle poverty and food insecurity in the first
instance in order to deliver the preconditions for growth. However, Dirk
Bezemer (13 May) contends that in most cases growth does result in poverty
reduction, and that exceptions are rare. Empirical evidence suggests that
growth almost always raises the income levels for the lowest 20% of the
income distribution. Conversely, attempts to tackle poverty directly
through redistribution have generally failed to deliver growth.
Moving the discussion forward. It might be useful to discuss further
whether, and under what circumstances, agricultural growth is pro-poor. Two
alternative definitions of 'pro-poor growth' are commonly used. (i) the poor
must obtain a significant benefit from growth, and (ii) the incomes of the
poor must increase more than proportionally to the non-poor. What evidence
is there to suggest that agricultural growth is more pro-poor (using either
definition) than growth in other sectors? Do the linkages between sectors
discussed in 1.1 make a difference to how the benefits of agricultural
growth are shared between income groups?
1.3 Food security and hunger
There have been several forcefully argued contributions that call for a
greater focus on hunger and food insecurity as part of poverty reduction
strategies (see Rutchi Tribathi, 13 May; Andrew MacMillan, 14 May; Andy
Bullock, 14 May). Andy Bullock suggests that "the global mortality
statistics for hunger may well, in their own right, be very similar to the 3
million annual HIV/AIDS deaths", and questions why pervasive hunger does not
have anything like the same international profile and response as HIV/AIDS.
Andrew MacMillan calls for DFID and other donors to take more seriously
their commitments to the World Food Summit targets and the hunger target in
the MDGs. He argues forcefully for stronger action, stating that "there are
no serious technical constraints to solving the hunger problem."
Moving the discussion forward. The implication of these contributions is
that a focus on tackling hunger would require greater priority to be given
to the agricultural sector. I think that in order to build a solid case a
few more links in the argument need to be made. Does a focus on hunger and
food security imply a significantly different development agenda to one that
is based on a broad poverty reduction strategy? If so, does this mean that
more attention needs to be given to the agricultural sector? We need to
bear in mind that while agriculture is important for increasing food
availability and improving nutrition (particularly in situations of
self-provisioning), it is often the lack of access to food (i.e. inadequate
incomes and purchasing power) that generates hunger and food insecurity.
1.4 Gender dimensions of agriculture, growth and poverty
Although a relatively neglected topic in the forum up to now, gender issues
have been discussed by several contributors this week. Clive Robinson (8
May) points to women's double burden in agriculture and domestic work, and
gender inequalities in access to resources, assets and decision making.
Rutchi Tripathi (13 May) comments that women are generally responsible for
more than half of agriculture production, but are disadvantaged in household
food and resource allocation. Diana Lee-Smith (12 May) suggests that where
women are in charge of production and household decisions, nutritional
outcomes for children are generally better. She raises concerns that the
development of cash cropping in Kenya's sugar belt (a crop generally
cultivated by men) may have led to adverse nutritional consequences.
Moving the debate forward. I hope that these contributions will encourage
others to enter the debate. It would be particularly useful at this stage
to consider the implications of gender relations for the design of
development strategies for the agricultural sector. Has ignorance of gender
relations been a major cause of failure of agricultural development
strategies? How do gender relations affect the outcome of agricultural
development? What specific interventions are required as part of
agricultural development strategies to support women's practical and
strategic needs? For example, Sophia Huyer (11 May) identifies the need for
low-cost reliable technologies for food processing, cooking and lighting, as
well as support to women's self help groups and cooperatives aimed at
improving marketing and promoting women's empowerment.
2) Alternative strategies for agricultural development
A number of different priorities for agricultural development are evident in
the discussions:
2.1 Intensification of cereals production
Louis Bockel (12 May) argues that intensive cereal based growth offers the
best prospects for sustained poverty reducing growth. He attributes this
mainly to the high average household budget share of the poor spent on
staple food items. He proposes that there are several necessary conditions
for intensive cereal-based transformations to occur: (i) appropriate and
high-yielding agricultural technologies, (ii) local markets offering stable
output prices, (iii) seasonal finance for purchased inputs, (iv) reasonably
secure and equitable access to land, (v) attractive returns for operators
and downstream agribusiness, and (vi) infrastructure to support input,
output and financial markets. He suggests that there has been a notable lack
of success in kick-starting cereal based intensive growth in poorer rural
areas, mainly because the private sector has not moved in to provide farmers
with input, output or financial market services that are attractively
priced, timely and reliable. Nick Parott (12 May) supports the view that
grain production should be the main agricultural priority especially for
resource poor farmers. He argues that the main challenge is to remove
cultural and economic obstacles to the adoption of new technologies.
Several other contributors sound a more cautious note on the value of a
cereals-based intensification strategy. Both James Biscoe (12 May) and
Vinay Chand (13 May) point to the long-term decline in agricultural
commodity prices that have offset yield increases to a certain extent. In
view of these trends they argue that while intensification is still
required, it is important to complement this strategy with actions to
promote agricultural diversification into higher value crops and
value-adding through processing.
Moving the debate forward. Agricultural intensification is just one of
several strategies available for agricultural development (e.g. cereals
based intensification, diversification into higher value crops,
diversification out of agriculture, value-adding through processing and
marketing). John Dixon (14 May) has suggested that different strategies are
appropriate in different settings. But, how do we know what is the
appropriate mix of strategies, what are the complementarities and
trade-offs, and what principles might be used to guide this choice? In
practical terms how can donors and governments support a broad menu of
agricultural and rural development options?
2.2 Small farm vs large farm strategies
Throughout the forum the consensus view has been in support of a small farm
development strategy. Several contributors have added their voice this
week. Leonidas Hitimana (12 May) describes a SWAC/OECD study that finds
that family farms in West Africa are more competitive than large farms.
David Gibbon (8 May) points to the resilience of small farms in Southern
Europe as an indication of the viability of this model. Julia Wright (10
May) emphasises the value of traditional knowledge ("ecological literacy")
held by small farmers in Zambia and Cuba. Jim Kinsella (May 13) argues that
small farming is the reality in many developing countries, and that
governments and donors need to work pragmatically within this context. He
states that "I advocate for starting where farmers are at, listening to them
and working with them."
A few contributors have discussed the potential role of large-scale
commercial farms and agribusiness. Speaking from experience in India, Vinay
Chand (17 May) argues that opportunities for commercial farming are
relatively limited: "most private investors know there is more money to be
made from trading and processing than from farming." Hence, large scale
private sector interests are mainly concentrated in processing, marketing
and other forms of service provision. Vinay states that export
opportunities will generally be met by contract farming and private owned
processing. John Atibila (17 May) describes an example of a fish processing
and marketing business formed by small-scale fish famers in Ghana
A rather different point of view is put forward by Dirk Bezemer (18 May) who
discusses the difficulties faced by smallholders in the face of
liberalisation policies that have simultaneously exposed farmers to risk and
resulted in a loss of service provision. He argues that there is a problem
of transaction costs that has often prevented the emergence of private
sector service provision. He suggests that in order to overcome the
transactions problem there may be a need to scale up or link farming
operations. This could be achieved through increases in farm size, large
scale private investment (domestic firms and MNCs), government interventions
or the formation of producer associations.
Moving the debate forward. While there appears to be a consensus that
development strategies should primarily be oriented towards the needs of
smallholders, there has been relatively little discussion of the
opportunities of commercial agriculture. Are there any success stories
worth highlighting (e.g. horticulture in Kenya, bananas in Cameroon)? What
about development strategies for countries with a dualistic (i.e.
smallholder and commercial) agricultural sector, or predominantly commercial
agriculture (Latin America)? Another issue worth considering is how farm
size distributions are conditioned by failures in factor markets. For
example, do failures in land and credit markets block processes of land
consolidation? Do (a) the decline in public agricultural service provision,
or (b) the growing market share of supermarkets confer advantages on large
farms? Is it the case that if the enabling environment for agriculture
could be got right then the whole issue of small farms vs large farms would
cease to be relevant because economic operators could be expected to find
the optimal farm size?
2.3 Low External Input Agriculture vs High External Input Agriculture
There has been a fascinating and vigorous debate on the merits of Low
External Input Agriculture (LEIA), a system that is essentially based on
recycling nutrients within a local area. Several contributors have
advocated a LEIA-based approach. Julia Wright (10 May) points to the
failure of industrial agriculture in fragile ecosystems and calls for low
input, organic farming. Nick Parrott (12 May) calls for a "farmer based
approach that builds on local strengths and knowledge", and argues that
"this seems to be the strength of the LEISA (and organic) approaches."
Other contributors have sounded a more cautious note. Jim Kinsella (12
May), suggests that LEIA may offer a way forward, but may not be appropriate
where labour is a constraint, in particular amongst communities affected by
HIV/AIDS. Dick Tinsley (12 May) contends that labour is usually the
limiting factor in smallholder agriculture, making LEIA generally
unsuitable. In a separate contribution he argues that LEIA may not provide
a sustainable development option where it requires the expansion of
cultivation onto marginal lands that are at risk of degradation. For every
hectare of land cultivated under LEIA systems an additional 3-5 hectares
would be required to generate nutrients (e.g. through grazing and manure
systems, or collection of plant matter). In contrast, agricultural
intensification strategies using chemical fertilisers (HEIA) may reduce
pressure on marginal lands thereby conserving natural resources and
biodiversity. However, these arguments have been countered by several
contributors. A contribution from Farmers link (13 May) argues that that
LEIA systems are generally compatible with ecosystem and wildlife
conservation, whereas High External Input Agriculture imposes significant
environmental costs (usually not internalised). Several contributors have
argued that LEIA systems are more suited to smallholders and offer a means
to avoid rapid displacement of labour out of the agricultural sector.
Robin Matthews (13 May) refers to a DFID review of LEIA systems. The main
conclusions are that: (i) LEIA is nothing new, and builds on traditional
farming practices, (ii) both LEIA and HEIA strategies are resource
intensive - the former requires large scale land and labour inputs, while
the latter is capital intensive, and (iii) both systems work under
particular conditions - the appropriate balance depends on which production
factors are most abundant.
Moving the discussion forward. I sense that this discussion has really
helped to clarify the issues. Both LEIA and HEIA appear to be valid in
different circumstances, and there is a need for flexibility. Changing
labour and land ratios may call the sustainability of LEIA systems into
question in some places. One question that has not been fully discussed is
the extent to which LEIA systems have been properly recognised in
agricultural research and extension systems, as well as broader donor and
government strategies for agricultural development.
************
Part 2 is coming later today.
Gareth Williams
Rue des Pâquis 15
1201 Geneva
Switzerland
tel: 0041 22 732 2372
mob: 0041 78 611 8589
email: <address removed>
web: www.garethwilliams.info
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