Agriculture holds key to prosperity in the region [1]
Wednesday, April 20, 2011 - 09:15. Updated on Monday, September 9, 2013 - 18:40.
While progress in China and South East Asia has led the way towards a major drop in the number of extremely poor people in the worlds rural areas, Asia and the Pacific region continues to be home to some of the largest concentrations of rural poverty anywhere, according to the International Fund for Agricultural Development (IFAD).
Commenting on a recently completed study, Thomas Elhaut, Director of IFADs Asia and the Pacific Division, noted that more than 350 million people in the region lifted themselves out of poverty over the past 10 years. However, Elhaut added that rural poverty rates have dropped only slightly in the last decade in South Asia, which now has the largest number of poor rural people about half a billion of any region or subregion in the world. Four-fifths of all extremely poor people in South Asia live in rural areas.
The food crisis of 2008 was exacerbated by the financial crisis in 2009 to 2010. The structural underpinnings of the new food equation, established in 2008, are reappearing with a vengeance now that the global meltdown is receding, stated Elhaut, adding, Asias smallholder farmers can offer business solutions, provided governments transmit world prices to the farm gate, and ensure there is market and institutional efficiency in support of higher-value supply chains.
The IFAD study, Agriculture Pathways to Prosperity in Asia and the Pacific, provides an Asia and Pacific regional perspective, highlighting the fact that the overall rate of extreme poverty in rural areas of developing countries has dropped from 48 per cent to 34 per cent over the past decade. The study points to key challenges facing rural people worldwide including increasingly volatile food prices, the uncertainties and effects of climate change, and a range of natural resource constraints. At the same time, profound changes in agricultural markets are giving rise to new and promising opportunities for the developing worlds smallholder farmers to significantly boost their productivity. Making use of these opportunities will be key to ensuring enough food for an increasingly urbanized global population estimated to reach at least nine billion by 2050.
According to Elhaut, There remains an urgent need to invest more and better in agriculture and rural areas in developing countries, based on a new approach to smallholder agriculture that is both market-oriented and sustainable.
More than 680 million people in Asia and the Pacific region continue to live on less than US$1.25 a day. More than 70 per cent of these are in South Asia Bangladesh, India, Nepal and Pakistan.
Across the region, 70 per cent of the poor live in rural areas and are generally either landless, have large families, lack education and have limited access to markets, credit and technology. Most have a high degree of vulnerability to shocks such as severe illness, natural disasters and sudden food price fluctuations. The region is also highly vulnerable to variations in energy prices due to its high dependence on fossil fuels.
Agriculture contributes substantially to GDP growth and poverty reduction. Asia and the Pacific region as a whole would need a 56 per cent increase in agricultural overseas development assistance, a 28 per cent increase in agricultural expenditure, a 23 per cent increase in fertilizer use and a 24 per cent rise in agricultural investment to achieve Millennium Development Goal 1 (MDG1), at US$2 poverty line over historical trends, but with varying subregional requirements. So the prospects of achieving MDG1 are not so daunting, said Elhaut.
The IFAD study outlines policy and investment strategies aimed at helping smallholder farmers and other rural people manage the risks they face, as well as enabling them to access emerging agricultural markets and opportunities in the non-farm economy and thereby improving their chances of financial success.
Each country must have policies in place to spur growth in the rural sector, enhance food security and overcome poverty, Elhaut emphasized. The successes and policy lessons learnt, point to five major challenges and grounds for optimism.
Sustained increase in agricultural productivity is required, especially among smallholders, with a focus on women, young people, other disadvantaged social groups and indigenous peoples.
Food price volatility, other market risks, and natural disasters could play havoc with the well-being and lives of rural populations. Policies that mitigate such risks and enable vulnerable people to cope with them and to coordinate their implementation are essential.
Integration of smallholders into high-value chains calls for the proactive engagement of national governments in laying down food safety standards; and producers associations in implementing them and in negotiating marketing arrangements.
Climate change poses grave threats to human well-being. While the search for emission reductions widens, greater emphasis on adaptation especially by smallholders is imperative.
Strong farm and non-farm linkages must be fostered in pursuit of sustained poverty reduction.
In summing up, Elhaut said, Much, of course, will depend on how various stakeholders communities, NGOs, national governments and multilateral development agencies respond to these challenges and coordinate their roles and policies, adding that, while the prospects of sustainable agricultural growth and poverty reduction may seem daunting to many, the strategy charted in the study is one of hope and optimism.
The International Fund for Agricultural Development (IFAD) works with poor rural people to enable them to grow and sell more food, increase their incomes and determine the direction of their own lives. Since 1978, IFAD has invested over US$12.5 billion in grants and low-interest loans to developing countries. IFAD is an international financial institution and a specialized UN agency based in Rome. It is a partnership of 166 members from the Organization of the Petroleum Exporting Countries (OPEC), other developing countries and the Organisation for Economic Co-operation and Development (OECD). - IFAD