Population models reveal that the world's urban areas are growing in both size and density. However, the other side of the coin is important to keep in mind: three of every four poor people in developing countries live in rural areas, and most of them depend on agriculture for their livelihoods. Even in a modern society, agriculture is timelessly important. The World Bank acknowledges this fact with the recent release of their 2008 World Development Report, titled Agriculture for Development.
Not only is agriculture centrally important as an employment for billions of people and a large share of GDP in agriculture-based countries, but it can transform a nation. Agriculture has a unique ability to foster development, the report says. Because of this, reforming the agricultural sector is central to progress toward the UN's Millennium Project goal of halving extreme poverty and hunger by 2015.
Agriculture's transformative potential
The power of agriculture as a driver of development has been evidenced in eastern Asia, where rural poverty declined by 150 million people between 1993 and 2003. Rapid agricultural growth in China and India was a driving force for this decline. In China, growth was fueled by changes in governance. In the 1980s the Chinese government dismantled the commune system of agriculture, the inefficiencies of which had contributed to mass hunger in previous decades. Instead, under the household responsibility system, individual families were allowed to privately cultivate their land and create voluntary contracts to sell their produce to the government. In addition, a liberalized trade approach allowed more foreign trade and foreign investment in agriculture as well as other sectors.
By contrast, India's agricultural reform was primarily technological in nature. The Green Revolution extended to India in the 1960s, introducing high-yield varieties of wheat and rice. Wheat varieties that put more energy into grain production and responded better to fertilizers doubled India's wheat production between 1966 and 1971.
These reforms have had a direct impact on the poor farming population by increasing farming production and efficiency, giving farmers more individual control over the sale of their crops, and ensuring a stable food supply for families that farm. By working from the bottom up, agricultural reforms create economic stability for the poor, who are most vulnerable to food instability caused by weather, inadequate distribution, and interruptions like natural disasters and war. In addition, technologies that create production above and beyond sustenance farming can foster local trade of staple foods, allowing some farmers to leave the fields and pursue other rural occupations. In this way, agricultural development serves to strengthen the very base of the economy of developing countries. In fact, cross-country estimates show that GDP growth originating from within the agricultural sector is at least twice as effective in reducing poverty as GDP growth originating in other sectors (WDR overview). What's more, agriculture can spur industrialization and lead a nation's economic growth, as it did in China, India, and Vietnam.
But if those kinds of results are to be realized in other developing countries, economic and governmental shifts need to happen. While 75 percent of the world’s poor live in rural areas, a mere 4 percent of official development assistance goes to agriculture in developing countries (see figure). Greater investment is a necessity if we hope to have an impact on global poverty.
More public spending on agriculture is needed
Source: EarthTrends, based on year 2000 data obtained from WDR Overview
The Report lays out the new model of agriculture that has emerged in countries making the transformation from agricultural-based to urbanized:
- production mainly by smallholders, who often remain the most efficient producers
- commercial farming with fair labor markets to accommodate larger-scale production
- value chains established by the private sector, connecting these suppliers to their markets
- governmental oversight to correct market failures and regulate competition
To implement this model and create economic growth in agriculture-based countries, which include most of Sub-Saharan Africa, the Report emphasizes we must:
- increase access to land, water, education and health care for the rural poor,
- make smallholder farming more sustainable and improve access to markets,
- implement technologies and practices to decrease agriculture's large environmental footprint,
- protect rural farmers from the worst effects of climate change, and
- create a dynamic rural economy with job opportunities outside of farming.
The scope of reforms may seem daunting. But if we don't renew our global investment in agriculture, it's clear that the costs, both human and ecological, will be steep.
RELATED LINKS
Has the World Bank been part of the problem? A recent New York Times article critiques its historical support for African farming.
UN Millennium Development Goals
EarthTrends
Inexhaustible Appetites: Testing the Limits of Agroecosystems
Food and Agriculture Overview 2005
Top photo by angela7dreams on Flickr
