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close this bookBriefs for Food, Agriculture, and the Environment - 2020 Vision : Brief 1 - 64 (IFPRI)
View the document(introduction...)
View the document2020 BRIEF 1 - AUGUST 1994: ECONOMIC GROWTH AND DEVELOPMENT
View the document2020 BRIEF 2 - AUGUST 1994: WORLD SUPPLY AND DEMAND PROJECTIONS FOR CEREALS, 2020
View the document2020 BRIEF 3 - AUGUST 1994: WORLD PRODUCTION OF CEREALS, 1966-90
View the document2020 BRIEF 4 - AUGUST 1994: SUSTAINABLE FARMING: A POLITICAL GEOGRAPHY
View the document2020 BRIEF 5 - OCTOBER 1994: WORLD POPULATION PROJECTIONS, 2020
View the document2020 BRIEF 6 - OCTOBER 1994: MALNUTRITION AND FOOD INSECURITY PROJECTIONS, 2020
View the document2020 BRIEF 7 - OCTOBER 1994: AGRICULTURAL GROWTH AS A KEY TO POVERTY ALLEVIATION
View the document2020 BRIEF 8 - OCTOBER 1994: CONSERVATION AND ENHANCEMENT OF NATURAL RESOURCES
View the document2020 BRIEF 9 - FEBRUARY 1995: THE ROLE OF AGRICULTURE IN SAVING THE RAIN FOREST
View the document2020 BRIEF 10 - FEBRUARY 1995: A TIME OF PLENTY, A WORLD OF NEED: THE ROLE OF FOOD AID IN 2020
View the document2020 BRIEF 11 - FEBRUARY 1995: MANAGING AGRICULTURAL INTENSIFICATION
View the document2020 BRIEF 12 - FEBRUARY 1995: TRADE LIBERALIZATION AND REGIONAL INTEGRATION: IMPLICATIONS FOR 2020
View the document2020 BRIEF 13 - APRIL 1995: THE POTENTIAL OF TECHNOLOGY TO MEET WORLD FOOD NEEDS IN 2020
View the document2020 BRIEF 14 - APRIL 1995: AN ECOREGIONAL PERSPECTIVE ON MALNUTRITION
View the document2020 BRIEF 15 - APRIL 1995: AGRICULTURAL GROWTH IS THE KEY TO POVERTY ALLEVIATION IN LOW-INCOME DEVELOPING COUNTRIES
View the document2020 BRIEF 16 - APRIL 1995: DECLINING ASSISTANCE TO DEVELOPING-COUNTRY AGRICULTURE: CHANGE OF PARADIGM?
View the document2020 BRIEF 17 - MAY 1995: GENERATING FOOD SECURITY IN THE YEAR 2020: WOMEN AS PRODUCERS, GATEKEEPERS, AND SHOCK ABSORBERS
View the document2020 BRIEF 18 - MAY 1995: BIOPHYSICAL LIMITS TO GLOBAL FOOD PRODUCTION
View the document2020 BRIEF 19 - MAY 1995: CAUSES OF HUNGER
View the document2020 BRIEF 20 - MAY 1995: CHINA AND THE FUTURE GLOBAL FOOD SITUATION
View the document2020 BRIEF 21 - JUNE 1995: DEALING WITH WATER SCARCITY IN THE NEXT CENTURY
View the document2020 BRIEF 22 - JUNE 1995: THE RIGHT TO FOOD: WIDELY ACKNOWLEDGED AND POORLY PROTECTED
View the document2020 BRIEF 23 - JUNE 1995: CEREALS PROSPECTS IN INDIA TO 2020: IMPLICATIONS FOR POLICY
View the document2020 BRIEF 24 - JUNE 1995: REVAMPING AGRICULTURAL R&D
View the document2020 BRIEF 25 - AUGUST 1995: MORE THAN FOOD IS NEEDED TO ACHIEVE GOOD NUTRITION BY 2020
View the document2020 BRIEF 26 - AUGUST 1995: PERSPECTIVES ON EUROPEAN AGRICULTURE IN 2020
View the document2020 BRIEF 27 - AUGUST 1995: NONDEGRADING LAND USE STRATEGIES FOR TROPICAL HILLSIDES
View the document2020 BRIEF 28 - AUGUST 1995: EMPLOYMENT PROGRAMS FOR FOOD SECURITY IN SUB-SAHARAN AFRICA
View the document2020 BRIEF 29 - AUGUST 1995: POVERTY, FOOD SECURITY, AND THE ENVIRONMENT
View the document2020 BRIEF 30 - JANUARY 1996: RISING FOOD PRICES AND FALLING GRAIN STOCKS: SHORT-RUN BLIPS OR NEW TRENDS?
View the document2020 BRIEF 31 - APRIL 1996: MIDDLE EAST WATER CONFLICTS AND DIRECTIONS FOR CONFLICT RESOLUTION
View the document2020 BRIEF 32 - APRIL 1996: THE TRANSITION IN THE CONTRIBUTION OF LIVING AQUATIC RESOURCES TO FOOD SECURITY
View the document2020 BRIEF 33 - JUNE 1996: MANAGING RESOURCES FOR SUSTAINABLE AGRICULTURE IN SOUTH ASIA
View the document2020 BRIEF 34 - JUNE 1996: IMPLEMENTING THE URUGUAY ROUND: INCREASED FOOD PRICE STABILITY BY 2020?
View the document2020 BRIEF 35 - JULY 1996: SOCIOPOLITICAL EFFECTS OF NEW BIOTECHNOLOGIES IN DEVELOPING COUNTRIES
View the document2020 BRIEF 36 - OCTOBER 1996: RUSSIA'S FOOD ECONOMY IN TRANSITION: WHAT DO REFORMS MEAN FOR THE LONG-TERM OUTLOOK?
View the document2020 BRIEF 37 - OCTOBER 1996: UNCOMMON OPPORTUNITIES FOR ACHIEVING SUSTAINABLE FOOD AND NUTRITION SECURITY - An Agenda for Science and Public Policy
View the document2020 BRIEF 38 - OCTOBER 1996: WORLD TRENDS IN FERTILIZER USE AND PROJECTIONS TO 2020
View the document2020 BRIEF 39 - OCTOBER 1996: REDUCING POVERTY AND PROTECTING THE ENVIRONMENT: THE OVERLOOKED POTENTIAL OF LESS-FAVORED LANDS
View the document2020 BRIEF 40 - OCTOBER 1996: POLICIES TO PROMOTE ENVIRONMENTALLY SUSTAINABLE FERTILIZER USE AND SUPPLY TO 2020
View the document2020 BRIEF 41 - DECEMBER 1996: STRUCTURAL CHANGES IN THE DEMAND FOR FOOD IN ASIA
View the document2020 BRIEF 42 - MARCH 1997: AFRICA'S CHANGING AGRICULTURAL DEVELOPMENT STRATEGIES
View the document2020 BRIEF 43 - JUNE 1997: THE POTENTIAL IMPACT OF AIDS ON POPULATION AND ECONOMIC GROWTH RATES
View the document2020 BRIEF 44 - JUNE 1997: LAND DEGRADATION IN THE DEVELOPING WORLD: ISSUES AND POLICY OPTIONS FOR 2020
View the document2020 BRIEF 45 - JUNE 1997: AGRICULTURE, TECHNOLOGICAL CHANGE, AND THE ENVIRONMENT IN LATIN AMERICA: A 2020 PERSPECTIVE
View the document2020 BRIEF 46 - JUNE 1997: AGRICULTURE, TRADE, AND REGIONALISM IN SOUTH ASIA
View the document2020 BRIEF 47 - AUGUST 1997: THE NONFARM SECTOR AND RURAL DEVELOPMENT: REVIEW OF ISSUES AND EVIDENCE
View the document2020 BRIEF 48 - FEBRUARY 1998: CHALLENGES TO THE 2020 VISION FOR LATIN AMERICA: FOOD AND AGRICULTURE SINCE 1970
View the document2020 BRIEF 49 - APRIL 1998: NUTRITION SECURITY IN URBAN AREAS OF LATIN AMERICA
View the document2020 BRIEF 50 - JUNE 1998: FOOD FROM PEACE: BREAKING THE LINKS BETWEEN CONFLICT AND HUNGER
View the document2020 BRIEF 51 - JULY 1998: TECHNOLOGICAL OPPORTUNITIES FOR SUSTAINING WHEAT PRODUCTIVITY GROWTH TOWARD 2020
View the document2020 BRIEF 52 - SEPTEMBER 1998: PEST MANAGEMENT AND FOOD PRODUCTION: LOOKING TO THE FUTURE
View the document2020 BRIEF 53 - OCTOBER 1998: POPULATION GROWTH AND POLICY OPTIONS IN THE DEVELOPING WORLD
View the document2020 BRIEF 54 - OCTOBER 1998: FOSTERING GLOBAL WELL-BEING: A NEW PARADIGM TO REVITALIZE AGRICULTURAL AND RURAL DEVELOPMENT
View the document2020 BRIEF 55 - OCTOBER 1998: THE POTENTIAL OF AGROECOLOGY TO COMBAT HUNGER IN THE DEVELOPING WORLD
View the document2020 RESUMEN No. 56 - OCTUBRE DE 1998: AYUDA A LA AGRICULTURA EN LOS PAÍSES EN DESARROLLO: INVERSIONES EN LA REDUCCIÓN DE LA POBREZA Y NUEVAS OPORTUNIDADES DE EXPORTACIÓN
View the document2020 BRIEF 57 - OCTOBER 1998: ECONOMIC CRISIS IN ASIA: A FUTURE OF DIMINISHING GROWTH AND INCREASING POVERTY?
View the document2020 BRIEF 58 - FEBRUARY 1999: SOIL DEGRADATION: A THREAT TO DEVELOPING-COUNTRY FOOD SECURITY BY 20207
View the document2020 BRIEF 59 - MARCH 1999: AGRICULTURAL GROWTH, POVERTY ALLEVIATION, AND ENVIRONMENTAL SUSTAINABILITY: HAVING IT ALL
View the document2020 BRIEF 60 - MAY 1999: CRITICAL CHOICES FOR CHINA'S AGRICULTURAL POLICY
View the document2020 BRIEF 61 - MAY 1999: LIVESTOCK TO 2020: THE NEXT FOOD REVOLUTION
View the document2020 BRIEF 62 - OCTOBER 1999: NUTRIENT DEPLETION IN THE AGRICULTURAL SOILS OF AFRICA
View the document2020 BRIEF 63 - NOVEMBER 1999: PROSPECTS FOR INDIA'S CEREAL SUPPLY AND DEMAND TO 2020
View the document2020 BRIEF 64 - FEBRUARY 2000: OVERCOMING CHILD MALNUTRITION IN DEVELOPING COUNTRIES: PAST ACHIEVEMENTS AND FUTURE CHOICES
View the document2020 BRIEF 65 - MARCH 2000: COMBINING INTERNAL AND EXTERNAL INPUTS FOR SUSTAINABLE INTENSIFICATION

2020 BRIEF 54 - OCTOBER 1998: FOSTERING GLOBAL WELL-BEING: A NEW PARADIGM TO REVITALIZE AGRICULTURAL AND RURAL DEVELOPMENT

David D. Bathrick

David Bathrick is chief of party, Winrock International, Lima, Peru.
This brief is based on 2020 Vision Discussion Paper 26

As the world prepares for the new millennium, all countries are trying quickly to adjust to changing needs within the increasingly mobile global marketplace. After years of structural biases and general disinterest in the developing world's agricultural sector, global trade is now forcing poorer, agrarian-based economies to assess their natural comparative advantages and quickly adapt. Almost revolutionary structures, policies, and strategies are now required to meet such challenges. While the view taken here emphasizes that the changes under way offer considerable opportunities, it also recognizes that many producers and rural residents lack the relevant experiences, skills, and financial support to adjust to the new conditions. Addressing these daunting needs in a comprehensive framework becomes a critical activity for future global well-being.

The centerpiece of the new paradigm is the rapid global shift from closed, nationally focused markets (protected and subsidized) to open, global markets (competitive and less subsidized). Given this dramatic contrast, the new paradigm requires that radically different working premises and strategies be introduced quickly, particularly as these relate to the changing agricultural sector.

The global process under way is admittedly complex, and experiences related to the economic transformation are limited. Nonetheless, political leaders, donor agencies, business interests, and development professionals need to seize the moment and commence with debate, commensurate structural overhaul, and new program development.

OLD AND NEW PARADIGMS

In order to comprehend the magnitude of the changes under way, a brief comparison of the overarching economic systems of the 1950s to 1970s and the 1990s is necessary. From the 1950s through the 1970s "import substitution" economic strategies prevailed in most developing countries. Formulated around the development of an urban, industrial production base serving limited national market needs, this strategy required overvalued exchange rates, inefficient price controls, protectionist measures, severe taxes, and a variety of subsidies to sustain it. Governmental planners promulgated centralized development strategies In many instances, government or parastatal agencies directed inefficient services affecting industrial, utility, banking, and agricultural support services. The private sector as a dynamic investment force was frequently marginalized while governmental organizations directly influenced capital mobilization and allocation.

Despite the successes of the Green Revolution, development never reached its potential because of the overarching fiscal and investment policy framework. By the 1970s, signs of economic fatigue and stress were common. Years of an increasingly inefficient and inflexible economic structure required fundamental structural overhaul. In the 1980s, structural adjustment reforms generated macro policy reforms designed to stimulate private-sector investments and energize markets. These economic reforms, accompanied by expanding regional and global trade agreements, converged to create a structural turning point. The stage was set for a new economic development paradigm. Some developing countries began to realize their comparative advantages. For them, agriculture has become a leading or lead sector. The faster growing of these economies generally show positive links between satisfactory reform and GDP, export, and agricultural growth rates. Countries with average or below-average performances do not show this relationship.

The emergence of the new paradigm in the late 1980s has meant a break from command-based economies and their inefficiencies and inflexibility. Economic systems are becoming more demand-driven and more responsive to national, regional, and international markets. In the key areas of development the new paradigm has brought greater attention to the private sector, market forces, agriculture, and agriculture's integration with the broader economy. In the area of market systems, for example, the old approach relied on parastatals or other government-influenced organizations that did not provide adequate services, encourage the building of rural infrastructure, or leave room for the private sector. The new approach is not beholden to this earlier era of government-led "producing and then selling." Instead it emphasizes knowledge of consumer needs, up-to-date market intelligence, the linking of local, national, and international markets, and rapid improvement in farm-to-market roads and other facilities.

THE ROLE OF AGRICULTURE IN THE NEW GLOBAL ORDER

Breaking from the recent past, "agriculture" - seen as a food and agroindustrial system - has emerged as a leading economic sector in many developing countries (see table). But its benefits are not as broadly based as could be the case. The majority of the small to medium producers - comprising 30-80 percent of the employment force in most poor countries - and rural nonfarm families are poorly prepared to either gain the broader benefits of the changes in agriculture or respond to previously unknown competitors. Furthermore, distant, possibly more efficient producers now have more opportunities to penetrate or expand market shares. Nevertheless, if developing countries aggressively take the initiative and make major internal structural reforms - providing capable small- and medium-sized farmers and agribusinesses with essential skills, tools, and infrastructure, and facilitating private investment - they will be better-suited to meet unprecedented challenges.

In this complex and interconnected environment, it becomes essential for developing and developed economies to increase considerably their support for agriculture and the rural sector in the developing world. The economic growth of developed countries is tied to an ever greater extent to expanding sales in the largely agrarian-based developing countries.

Under a more market-driven economic policy framework, agriculture is key to facilitating global trade expansion and GDP growth. In this paradigm agriculture helps to generate incomes and jobs for the poorest part of the population, facilitate more appropriate land and natural resource practices, and provide broader social benefits within an increasingly decentralized political framework.

THE NEW PARADIGM: WHAT SHOULD BE DONE?

To make the decisive shift toward markets, national governments must become convinced that fundamental structural changes are in their national interests. Accepting this will not always be easy, and in that regard donors will need to play more aggressive and vigilant roles. Producers, the private sector and agribusiness investors, NGOs, and universities in developed and developing countries will also have to play mutually beneficial roles. The conceptual themes for formulating the 21st century's agricultural development paradigm are as follows:

· The role of the market becomes a paramount consideration.

· Agricultural and rural development become essential for generating broad-based economic growth.

· Agriculture requires a vision that transcends traditional sector approaches based on production.

· A pervasive import-substitution legacy should be overcome to optimize responses to the new economic order.

· New public and private roles are required to facilitate investments and equity needs.

· Donor countries should fashion appropriate commitments for the new opportunities and needs now prevailing.

· Foreign aid programs must transcend "assistance" premises to embrace opportunities for mutually beneficial growth.

It is time to move beyond the macropolicy environment that is now in place throughout the world and enter into a series of complementary, sector-specific activities. These will draw heavily from private-sector investment - the bulk generated by producers who, at this juncture, will have to be supported nationally and by donors. In the push to respond to current opportunities, there may be a tendency to dust off programs deemed appropriate during an earlier era. However, this temptation should be curtailed because it would likely be counterproductive. Instead a series of key program elements considered essential for creating the new food and agroindustrial systems should be kept in mind:

· Create the capacity to strategically advance and promote national comparative advantage and competitiveness.

· Establish an appropriate policy framework and mutually supportive linkages with other sectors to ensure maximum effectiveness of development efforts.

· Develop necessary management and marketing skills and support services to enhance local development opportunities.

· Develop dynamic market systems and complementary infrastructure services.

· Establish comprehensive rural financial markets.

· Create market-driven agricultural technologies for achieving growth.

· Utilize natural resource management practices to enhance sustainable use.

· Develop alternative investment, growth, and welfare strategies to expand rural well-being.

The new paradigm will not be institutionalized soon unless high-level commitments are quickly mobilized to forge the new system. The major adjustments described will have to occur during a period of very high stakes and uncertainties. The new global economic system has been launched, and there is great hope that this will be the basis for improved economic well-being that is socially, environmentally, and politically sustainable. The successful transformation of literally hundreds of millions of farm enterprises and the gainful employment of a similar number of rural dwellers, many of whom are poorly prepared to respond to new demands, are at stake.

Leaders from the developing and the developed communities and their donor agencies now have a special opportunity to chart a course for a more sustainable and prosperous century. Developed countries, many building on traditional international ties and their experiences with market-based growth, and some with considerable prior international agricultural development achievements, should urgently support and help coordinate the global transformation process. Under such an initiative, the prospects for maximum global well-being will be enhanced considerably.

Share of agribusiness in GDP, selected countries


Share of GDP


Country

Agriculture

Agriculture-related manufacturing and services

All agribusiness

Share of manufacturing and services in agribusiness


(percent)

Philippines

21

50

71

70

India

27

41

68

60

Thailand

11

43

54

79

Indonesia

20

33

53

63

Malaysia

13

36

49

73

South Korea

8

36

44

82

Chile

9

34

43

79

Argentina

11

29

39

73

Brazil

8

30

38

79

Mexico

9

27

37

75

United States

1

13

14

91

Sources: Pryor and T Holt, Agribusiness as an Engine of Growth," USAID, forthcoming in 1998.

Note: All agribusiness is defined as agriculture, plus the shares of manufacturing and services that are related to agriculture.