Tuesday, September 27, 2005

Agriculture - the missing link in the MDGs?

From the CGIAR (Consultative Group on International Agricultural Research ): Agriculture is essential step to meeting the MDGs. The argument for agriculture as a key element in the MDGs has been succinctly articulated here. First, agriculture is mainly what the poor are doing.
There are strong, direct relationships between
agricultural productivity, hunger, and poverty. Threequarters
of the world’s poor live in rural areas and
make their living from agriculture. Hunger and child
malnutrition are greater in these areas than in urban
areas. Moreover, the higher the proportion of the rural
population that obtains its income solely from
subsistence farming (without the benefit of pro-poor
technologies and access to markets), the higher the
incidence of malnutrition.

Second, there is a vicious circle of poverty, hunger, and development:
Hunger, and the malnourishment that
accompanies it, prevents poor people from escaping
poverty because it diminishes their ability to learn, work,
and care for themselves and their family members. If
left unaddressed, hunger sets in motion an array of
outcomes that perpetuates malnutrition, reduces the
ability of adults to work and to give birth to healthy
children, and erodes children’s ability to learn and lead
productive, healthy, and happy lives. This truncation of
human development undermines a country’s potential
for economic development—for generations to come.

Empirically the importance of agriculture in the redution of poverty is clear:
Empirical research provides stark evidence of the
benefits of agricultural productivity. In Africa, for
example, a 10 percent increase in the level of
agricultural productivity is associated with a 7.2
percent reduction in poverty. In India, a similar
increase in productivity has been estimated to
decrease poverty by 4 percent in the short run and 12
percent in the long run.

Calculations from a world food model suggest that an investment scenario for MDGs rquires an extra 161 billion dollars investment in agricultural development (a total of 591 billion over a 25-year period). This is sufficient for achieving the goal of cutting the world's proportion of undernourished children by half. There are five "key drivers" for agricultural development: education, rural roads, agricultural research, irrigation, and clean water.

One hundred sixty-one billion dollars. If implementing agencies and the international community can deliver, it's money well-spent.


Amadeo said...

"education, rural roads, agricultural research, irrigation, and clean water."

Missing from the above is the needed capital that the poor entrepreneurs must have to produce. Unless, we are back to the old and ineffectual model of having the government provide that too.

I can say that personally in partnership with a sibling we have been engaged in agricultural production for the past 3-4 years in Bukidnon, specializing in high-value crops.

We have had to rely on our own efforts in the area of agricultural research and the education of the farmers under our employ. NIA provided the irrigation coming from a clean-water creek. And new landowners in the area undertake their own road improvement.

But definitely, capital would be a necessary ingredient if the poor tillers are to become productive.

Past government failures as sources and administrators of capital should make one wary using this model again.

Econblogger said...

Capital shortage is a big problem, one however that is due to "inherent" problems such as imperfect information and imperfect enforcement of contract. So the private sector (whether for-profit or non-profit) cannot solve the problem; nor can (as you say) government address the problem in a low-cost manner. Probably we just to have work with the "easier" investment options to get around this.

Anonymous said...

I've always thought that the lack of capital is one of our own making. Foreigners are willing to invest in developing countries. Unfortunately, our national policies and political will (with regards to consistency) is sorely lacking in attracting this.