Putting Agriculture Back on the Map
A World Bank report targets agriculture's role in addressing global poverty.
Alain de Janvry, writing as co-author of the World Bank's annual report on development, points toward investing in agriculture as the means of lifting billions of people out of poverty.
For the first time in a quarter century, the World Bank's flagship annual report on development put agriculture and the productivity of small farmers at the heart of a global agenda to reduce poverty. Three-quarters of the world's poor still live in the countryside.
The World Development Report, released last fall and co-authored by Alain de Janvry, professor of agriculture and resource economics for 40 years and one of the world's authorities on developing economies, is the first on agriculture since 1982. De Janvry, along with Australian economist Derek Byerlee, codirected the 18-member core team that prepared this year's report on agriculture. Elisabeth Sadoulet, another professor of agricultural and resource economics at Berkeley, is also one of the report's authors.
Just a week before the report was published, an internal evaluation unit chided the bank for its neglect of agriculture in Africa and its plummeting financial support for that sector over the past 15 years - support that did not begin to grow significantly until 2006.
"What we're hoping to do with this report is put agriculture back on the map."
More broadly, the report crystallizes an emerging consensus among wealthy countries, philanthropists, and African governments: Increased public investment in scientific research, rural roads, irrigation, credit, fertilizer, and seeds - the basics of an agricultural economy - is crucial to helping Africa's poor farmers grow more sorghum, corn, millet, cassava, and rice on their miniature plots.
"What we're hoping to do with this report is put agriculture back on the map," says de Janvry. "The agricultural sector in developing nations has been underfunded for the past two decades. The Millennium Development Goal of cutting poverty and hunger in developing nations by half by 2015 is not going to be achieved unless more attention is paid to where the world's poor are and what they do."
According to the report, the world's demand for agricultural crops - for food, feed and biofuels - is expected to double within the next 50 years. At the same time, the natural resources that sustain agriculture will become increasingly scarce and degraded with overuse and the effects of climate change. The report concludes that greater investment in agriculture is needed to trigger economic growth, and that economic growth originating in agriculture will benefit the income of the poor 2 to 3 times more than growth from the non-agricultural sector. The power of agricultural growth in releasing large numbers of people from poverty has been amply demonstrated by recent successes in China and Vietnam, according to the report's authors.
"The word's demand for agricultural crops is expected to double within the next 50 years, but the natural resources that sustain them will become increasingly scarce and degraded."
"We are proposing that the shares of public investment and foreign aid to agriculture be increased from 4 to 10 percent in sub-Saharan Africa," says de Janvry. "This is akin to the investment of resources in successful countries such as India and China."
Foreign aid for agriculture has plunged as support for global health and primary education has surged. The fight against AIDS and other diseases is keeping millions of people alive, and rising elementary school attendance is lifting literacy rates. But most poor Africans make their living in agriculture and need to grow more crops to feed themselves and earn their way out of destitution, many analysts say.
"We're not saying health and education aren't important," says de Janvry. "But if you look at Africa, there's no alternative to agriculture as a source of growth."
The World Bank is not the first to reach this conclusion. At a 2003 African Union summit, African governments promised to more than double their own very low public spending on agriculture. In 2005 the United Nations Millennium Project, led by Columbia University economist Jeffrey D. Sachs, advocated major investments to increase the productivity of poor farmers in Africa. Last year, the Bill and Melinda Gates Foundation joined the Rockefeller Foundation to help bring a green revolution to Africa. The Gates Foundation, known for its work on global health, was motivated in part by an awareness that extreme poverty and malnutrition were underlying causes of much of the sickness and premature death plaguing Africa.
But the bank - the world's leading development institution and financier of antipoverty programs - plays a unique role in advising poor countries, and its return to agriculture is likely to influence practical policies across sub-Saharan Africa and South Asia, where hundreds of millions of farmers and landless laborers are still mired in poverty.
The 365-page report was conceived before the arrival of the bank's new president, Robert B. Zoellick, but Zoellick embraced its themes while acknowledging the recent critical evaluation of the bank's own performance. "To make this successful, we're going to need to increase investment," he said at a forum that was shown live on the Web.
Robert S. McNamara, an earlier World Bank president, initiated the last period of ambitious investment in African agriculture, in the 1970s. Internal evaluations found that many of those projects and subsequent ones failed for a variety of reasons. The projects were often complex, devised and run by outside professionals and not adopted wholeheartedly by poor countries that had little capacity to implement them independently, and sometimes had little commitment to poor farmers.
Private markets often failed to deliver the range of goods and services farmers needed, including improved seeds, fertilizer, and credit.
In the 1980s, in the era of Ronald Reagan and Margaret Thatcher, the World Bank increasingly withdrew its support from agriculture and expected private markets to spur growth through competition. Bank officials even thought profit-seeking companies would build toll roads in remote parts of Africa. But, as the recent internal evaluation found, private markets often failed to deliver the range of goods and services farmers needed, including improved seeds, fertilizer, and credit.
In India's green revolution, which began in the 1960s with the introduction of new high-yielding varieties of rice and wheat, the World Bank, the Rockefeller Foundation, and the United States encouraged the Indian government to play a pivotal role in the provision of seeds, fertilizer, and credit, says Uma Lele, an agricultural economist who worked at the bank for 35 years and evaluated many of its agricultural programs before retiring. The Indian state also set floor prices for wheat and rice to ensure farmers a return on their investments.
In the effort to bring an agrarian revolution to Africa, much of the debate will now focus on the role that African governments should play in spurring farm productivity. Economists who have read the World Development Report say there was clearly still a great deal of ferment and disagreement within the bank about many of the particulars. For example, should African governments give farmers subsidies to buy fertilizer, and under what conditions?
The report notes that agricultural subsidies have a way of becoming deeply entrenched politically long after their original purpose has been served. The report found, for example, that if European countries, the United States, and other wealthy nations removed all tariffs and subsidies for cotton, soybeans, and other oilseeds - practices that reduce the world price of those commodities and make it harder for unsubsidized farmers in poor countries to compete - developing countries' share of world trade in cotton and oilseeds would be more than 80 percent in 2015 instead of only about half.
The report was not meant to settle the complicated and difficult policy questions, says de Janvry. Rather, he hopes, the work will help "to change the conversation."