Agriculture and Food Security

Improving dietary diversity is more difficult than it looks: In Bangladesh, a poor family’s diet consists almost entirely of rice. It is one reason why the country has some of the highest child malnutrition rates in the world. Poor farmers grow rice because it sells at the local market. T hey can take a chance and grow something besides rice, but the consequences are dire if they can’t sell the new crop. Fear of more severe hunger and poverty dictates their choices of what to grow and what the family will eat.

Improvements in food security and nutrition are linked to a productive agricultural sector. Common sense might suggest that we need to make sure that domestic food supplies match demand for food—but that’s not the core of the problem. The recent increases in hunger were because of the high food prices, not because there wasn’t enough food to go around. Although grain stocks were low, they were not too low to feed everyone if some nations with surpluses hadn’t panicked and banned exports. In the same vein, famines have occurred in countries where some parts actually have food surpluses.¹ The unprecedented rise in hunger recently was a consequence of the high costs.

Agriculture is a key driver of economic growth in poor countries. In very poor countries, agriculture provides more than 70-80 percent of the labor force with the greatest share of their incomes. When the agricultural sector is growing, so are people’s incomes. It’s what determines whether they are eating only a bowl of rice seven days a week or they can occasionally afford to add some meat and vegetables to their diet.

Despite incontrovertible evidence that food security is linked to agricultural productivity, over the past three decades donors slashed agriculture as a share of their development budgets.² By about 2005, U.S. development assistance for agriculture programs had fallen to 25 percent of its mid-1980s levels.³ Between 1991 and 2006, World Bank lending to sub-Saharan African countries for agriculture constituted just 8 percent of its total lending to the region.⁴ Matching the example set by donors, poor countries with agriculture-based economies have the lowest percentage of public investment in agriculture as a percentage of their Gross Domestic Product (GDP).⁵ In sub-Saharan Africa, public spending on agriculture accounts for an average of just 4 percent of total government spending.⁶

Sudanese farmer harvests sorghum grown from seeds donated by The U.N. Food and Agriculture Organization.

How did these disinvestments happen? It’s a “chicken and egg” question. Often, developing countries cut spending on agriculture because they were directed to do so by donors. Even when donors did not make these instructions explicit, pressure was clearly there. If a country failed to adhere to loan conditions set by the World Bank and International Monetary Fund (IMF), loans were cancelled and other donors withdrew assistance.⁷ And those loan conditions included opening markets up to imports. The World Bank’s Independent Evaluation Group’s assessment of the organization’s policy advice to countries in Africa on agriculture indicated a strong focus on reducing government involvement in the agriculture sector and on boosting private sector investment by reducing trade and regulatory barriers.⁸ However, there was limited understanding about the complementary actions needed to boost agriculture development and no clear strategy on how to overcome other barriers, including access to credit, seeds, fertilizer, irrigation, transportation and rural roads.⁹

Because of agricultural subsidies, the United States was able to export grain into developing countries at well below the cost of production, making it very difficult for poor farmers to compete for markets inside their own countries. The irony is that these farmers are the same people U.S. development assistance is intended to help. In Ghana, subsidized poultry from the European Union flooded local markets, driving most of Ghana’s own poultry farmers out of business. When Ghana’s government responded by attempting to impose a stiff tariff on poultry imports, the IMF objected and the tariff was never implemented. In 1992, domestic farmers supplied 95 percent of Ghana’s poultry market, but by 2001 it was just 11 percent.¹⁰

In hindsight, it may look like disinvestment from agriculture was a deliberate decision by donors. But the prevailing beliefs at the time were that economic growth would bring about development and that the free market would deliver economic growth faster than public investments. Also, grain prices began falling in the 1960s and continued on a downward trend throughout the 1990s—so it was not seen as risky for developing countries to rely on “cheap” grain imports rather than develop their own agriculture sectors.

Fish farmers in Bangladesh display their catch. The fish are raised in ponds supported by donors, including USAID.

Nowhere did these policies backfire more than in agricultural research. Donors cut assistance to developing countries for agricultural research by 64 percent between 1980 and 2003.¹¹ Commercial agriculture has a robust research sector but it is geared almost entirely to large commercial farmers. Without public investments, little research gets done to increase productivity in the smallholder sector—composed of more than 400 million farmers in the developing world.¹² There are also new research needs. As climate change not only lengthens periods of drought but leads to rising sea levels, farmers need strategies to adapt—for example, drought-tolerant seeds suited to the variety of agro-ecological environments where smallholders farm, plus seeds that can thrive in higher saline environments. The neglect of the research sector cannot be reversed quickly. It takes years to build the capacity of research institutions and the human capital to do the research.

With this said, all signs indicate that a new approach to global food security strategy is evolving quickly. The unprecedented rise in the number of hungry people after the food-price shocks has led governments in both rich and poor countries, as well as multilateral institutions like the World Bank and U.N. agencies, to refocus their attention on agricultural investments. It is very important to target these resources properly. Focusing on smallholder farmers is essential. Generally, this means focusing on women and on the gender issues that could affect programs’ outcomes. Up to 80 percent of the smallholders in some African countries are women, and women also represent the majority of smallholders in most of Asia. ¹³ Moreover, when women begin to earn higher incomes, their food purchasing decisions are likely to improve their children’s nutritional status.¹⁴

Issues