Summary
Seventy-five per cent of the world's poor live and work in rural areasi. Most of these people are smallholders who depend on agriculture for their subsistence. Agriculture is therefore of crucial importance to meeting the Millennium Development Goal on poverty reduction, especially in Africa. But agriculture fell out of favour with DFID and other donors in the 1990s and, since then, the plight of poor farmers has worsened. Today, most smallholder farmers are unable to access the basic services which could help them increase their productivity and forge a sustainable livelihood from agriculture. Despite the obvious contribution of agriculture to poverty reduction, DFID has been slow to re-engage with the sector but is now showing a willingness to do so.
Some commentators argue that, in a globalised world, smallholder agriculture has a limited potential for acting as a force for development. In the long-term, they may be correct, but we believe that agriculture should be understood as a process in which small-scale farming can drive development at an early stage. As agricultural productivity intensifies, people will leave the land to work in other sectors and the size of farms will increase. Smallholdings, an everpresent reality in Africa, can be efficient and can successfully engage in commercial operation. Small-scale farming can initiate rural development and be a source of poverty
reduction. But this can only happen if farmers are provided with the services they need. These services include access to basic inputs: fertilisers and improved seeds - the provision of which helped Asia more than double its productivity during its Green Revolutionsii. Financial services are vital to enable farmers to access these inputs. Plant breeding and other new technologies can also raise productivity provided they produce innovations that are useful to smallholders, and not solely to large-scale commercial operators. Farmers also need information about, and access to, markets. In part access to markets is enabled by the
development of infrastructure which DFID has rightly emphasised. But DFID has, in our view, concentrated too narrowly on creating an economy-wide "enabling environment" to the exclusion the specific challenges of getting smallholder agriculture moving. DFID must now urgently turn its attention to the sustainable provision of the most basic of services to smallholders.
Agriculture's fall from favour has to be seen in the context of the failure of large agricultural projects and the realisation that there were severe problems with state provision of agricultural services and the use of generalised subsidies. The role of the state was reduced and the private sector was expected to fill the gap in service provision. While this did happen to some extent in the cash crop sector, the private sector did not step in to provide services to those growing staple, food crops. We are convinced that some level of state involvement in delivery of these key agricultural services is now necessary. It is time for DFID to work to develop appropriate models for state involvement that recognise the respective benefits, and limits, of the public and private sectors. DFID must also act as an advocate for agriculture with the World Bank, the body which has the main influence on the broader policy environment. DFID and other policy makers need to understand why past policies have failed and address the existing gap in service provision. The world's poor need a mixed strategy that strikes the right balance between state and private sector involvement, as well as an appropriate balance in emphasis on small-, medium- and large-scale farms. Finally, the regional diversity of agriculture requires policy to be sensitive to the local context: a blanket approach will not work.
Footnotes:
- Rural Poverty Report 2001, International Fund for Agricultural Development (IFAD), page 3.
- Cereal production in south Asia rose by 92% between 1969 and 1996 and doubled in east and southeast Asia (Transforming the Rural Asian Economy: The Unifinished Revolution, Rosegrant and Hazell, Asian Development Bank / Oxford University Press, 2000, Introduction, page xix).
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