Good news on agriculture: now come the tricky questions

14 July 2009
Comment
From all quarters comes news of more support to boost agriculture and fight hunger in the developing world.

Last year the UN Secretary General set up a High Level Task Force on the Global Food Security Crisisin reaction to the sharp rise in food prices on world markets seen in 2007 and the first half of 2008. A Global Partnership on Agriculture and Food Security is being forged. The food price spike was a key element on the agenda of the G8 meeting in Japan in 2008. Donors were galvanised, with most of the International Financial Institutions setting up fast-disbursing facilities to allow rapid response to the food crisis, while the European Commission promised an additional €1 billion for agriculture — plans for which were announced in March 2009.

The last two weeks has seen a flurry of initiatives. First the African Union heads of state summit in Sirte, Libya reaffirmed support to agriculture as a priority for the continent. Just last week, the G8 meeting in L’Aquila, Italy, promised $20 billion over three years to boost food supplies in developing countries. Finally, the UK Department for International Development has published its new white paper, Eliminating World Poverty: Building our Common Future, which includes a substantial section on agriculture and food security and promises to double UK support to international agricultural research over the next five years.

This is good news. For most low income countries agricultural growth can contribute to economic growth through production of food and raw materials and foreign exchange earnings, while stimulating manufacturing and services by widening the domestic market and transferring capital and labour to those sectors. Agricultural growth, moreover, can have a strong effect on poverty, much of it rural. There are obvious direct benefits, not only to small farmers, but also to more prosperous farmers who can hire in more labour, and who spend much of their extra income locally, thereby creating more jobs. And a thriving agriculture sector is likely to push down the price of food, to the benefit of the urban poor.

So more funds for agriculture, reversing the neglect seen since the early 1980s in some parts of world and especially in Africa, are very welcome. Now the money is there, policy-makers need to address five questions:

  1. What will the funds be spent on? It is not so much the amounts spent, but on what, and how effectively, that counts. Spending on agricultural research and extension, rural roads, education and health care all contribute demonstrably to agricultural growth and poverty reduction. Distributing seed and fertiliser may be necessary to confront short-term emergencies, but cannot surely be sustained in the medium term. But the attractions of such distributions, both political and administrative, to national governments and donors are all too clear.
  2. Will the Doha Development Round be brought to a conclusion that promotes free trade in agriculture and reduces substantially those Northern subsidies — such as US and EU payments to cotton farmers that depress world prices — that distort world markets?
  3. Can effective solutions to failures in rural markets be found? In Africa in particular, the inability of farmers to obtain credit or fertiliser locally at a reasonable price can be major obstacles to investment and innovation. Solutions will be national and local: they cannot be willed by funding or derived from a common template. They require local facilitation, organisation, initiative and leadership.
  4. Will the North be prepared to compensate farmers in the South for the damages of climate change? This may be asking too much, so then comes the question of whether the North is even prepared to fund developing world farmers for carbon storage to mitigate climate change. This would be in the direct interests of the OECD electorates. Getting this accepted in principle is one of the key aims for the Copenhagen meeting on climate change in December 2009. Devising a working technical scheme for this may take time, but the political go-ahead has to be given first.
  5. Will nutrition be sidelined in an argument that links hunger in the South to agricultural production? Yes, in many parts of Africa agricultural development will not only produce more food but reduce poverty and thus hunger: but that is not the end of the story. In some parts of Africa, such as the Sahel, malnutrition is as much a matter of health, sanitation and care of infants as it is of food. The most straightforward of investments in clean water, sanitation, and basic health care —including child immunisation and oral rehydration therapy — could make a big difference to infant nutrition — and hence to the welfare of future generations.

So the news is good, but there’s plenty more to be thinking about.

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