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Agriculture and Challenges to Development

The Challenge of Poor Starting Conditions

One of the major barriers to development in sub-Saharan Africa has been the poor performance of its agricultural sector. For a variety of reasons, the Green Revolution that transformed much of Asia never occurred in Africa. What has this meant for development? Figure 1 shows the relationship between agricultural productivity (measured in terms of crop yields) and poverty levels for South Asia and sub-Saharan Africa between 1984 and 2002.

In spite of some formidable obstacles, it is possible to achieve sustained agricultural growth in Africa. Twelve sub-Saharan countries have had agricultural growth rates higher than 3 percent (some higher than 5 percent) sustained over the past 15 years. Organizations like the National Smallholder Farmers Association of Malawi (NASFAM), which provides production and marketing support for more than 100,000 farmers, demonstrate what can be achieved through a combination of local partnerships and financial and technical support. Another encouraging sign is that a number of African leaders have pledged to commit 10 percent of their national budgets to agricultural investments.

A Green Revolution in Africa, however generally defined, will require national governments and the international community to act in concert, putting in place the policies, institutions, and resources that will encourage and support smallholder agriculture and rural development. This must include applying the lessons from the first Green Revolution as well as significantly increasing investment in rural infrastructure, including irrigation, roads, electricity, and communications, all of which are woefully underdeveloped in sub-Saharan Africa. The emerging Alliance for a Green Revolution in Africa (AGRA), which brings the Gates and Rockefeller Foundations together in partnership with national leaders and African scientists, holds real promise for stimulating the kind of research and policy reform that leads to sustainable economic growth benefiting poor people. U.S. development assistance could obviously play a role here as well.

Dr. Norman Borlaug, the Nobel Peace Prize winner now in his 90s, who is often called the father of the Green Revolution, dismisses the notion that a Green Revolution in Africa is a lost cause. “This is the same argument used by a number of famous U.S. academicians in the early 1960s in describing the hopelessness of food production in India and China,” Borlaug said in Bread for the World Institute’s 2005 Hunger Report, Strengthening Rural Communities. “And look what happened. Technology is now available to double, triple, and in some cases quadruple maize production. This potential is not being realized because of lack of infrastructure, especially roads; lack of courageous African political leadership; and lack of financial assistance from affluent nations.”

The Challenge of Weak Governance and Institutions

The accomplishments of the Green Revolution would not have been possible without substantial political and financial support from the countries involved. Underinvestment by developing-country governments explains a lot of their underperformance in the agricultural sector.

Ghana in the 1960s and 1970s is an example of how government policies in the agricultural sector can nearly lead a country to ruin. Ghana was the world’s leading producer of cocoa in the 1960s, which accounted for more than 50 percent of government revenues. As the price of cocoa dropped in world markets, the government sought to recoup some of the lost revenue by imposing steep new export taxes on the smallholder producers, who accounted for almost all of the country’s production capacity. The Ghana Cocoa Board, the only authorized exporter of cocoa, paid farmers less than the real value of what it was worth. This led to a rash of smuggling cocoa out of the country, or farmers switching to other crops. Cocoa production plummeted and, by the early 1980s, was less than a third of peak production in the 60s.22 As a result, government revenues vanished and the country was driven deeper into poverty.

In the 1980s, things began to turn around as the government sought to correct its past missteps. Economic reforms implemented in the 1980s and 1990s allowed Ghana to recover from the worst of the damage, but not without a great deal of suffering. Ghana’s development prospects now look promising. Currently, it is one of the few sub-Saharan countries on track to reduce hunger by half (MDG 1) by 2015. But the experience of mismanaging the cocoa industry demonstrates the damage that flawed agricultural policies can cause poor countries.

Good governance has allowed the Ghanaian government to build better relations with donors. Ghana’s development partners have been involved in the country’s resurgence, for example, by providing debt relief. The government has used the freed-up resources to improve the health, education, and agriculture sectors. As recently as 1998, more than 50 percent of the country was living on $1 per day. In 2005, it was down to 29 percent.

Alliance for a Green Revolution in Africa (AGRA)

The Alliance for a Green Revolution in Africa (AGRA) seeks to empower small-scale farmers with the technology and information to improve farming practices. Led by the Rockefeller and Gates Foundations, AGRA provides resources and leadership to tackle some of the toughest problems confronting African farmers:

  • Improving seeds for locally grown food crops;
  • Managing water resources;
  • Strengthening agricultural markets;
  • Scaling up agricultural education, research, and extension services;
  • Creating a better policy environment for farmers.

Some have criticized AGRA for taking a “one-size-fits-all” approach to the variety of agro-ecological climates across African countries. But AGRA is ensuring that strategies are ecologically sound, technologically appropriate, and geared to meet the needs of small-scale farmers who need simple and sustainable solutions. AGRA is not pursuing or funding the development of new seed varieties through the use of genetic engineering. As many agricultural experts in Africa readily understand, a lot can be done through better seed breeding and better soil and water management.

The Challenge of Conflict

Food insecurity, like poverty, can be a cause as well as an effect of conflict. U.N. agencies estimate that armed conflict cost Africa over $120 billion in agricultural output during just the last third of the 20th century.

Real or perceived inequities in access to land and water resources underlie many of the world’s conflicts. One of the darkest episodes in recent human history is the Rwandan genocide of 1994. A leading cause was the government’s exploitation of scarce land and water resources, which exacerbated the ethnic divisions within the country. The Hutu government, led by President Juvenal Habyarimana, exploited a drought to provoke public fears that scarce resources would lead to further increases in hunger. The World Bank’s 2008 World Development Report argues that to ignore the agricultural sector in fragile states increases the risk of further instability. Rwanda again serves as a good example of how the agricultural sector can play a key role in helping a country to rebuild. Rwanda is world renowned for its specialty coffees. Between 2001 and 2006, export revenues for Rwandan coffees increased from zero to $8 million; much of this can be credited to the technical and financial assistance of USAID.

The productive agriculture sector has fueled Rwanda’s economic growth and successes in poverty reduction. A recent study found that agricultural growth in Rwanda contributed 50 percent more to poverty reduction than growth in other sectors, and that a 1 percent annual growth rate in staple food production translated into a 3 percent reduction in poverty.

In many conflict countries, a large share of the population lives in rural areas and derives its income in whole or in part from agriculture. In such countries, agriculture and the wider rural economy provide the best means of giving people a renewed stake in their societies. When a society emerges from conflict, it is vital to engage as much of the population as possible, as rapidly as possible, in positive, income-generating pursuits. Development assistance should be in place to help countries through post-conflict reconstruction, when peace is fragile, but donors have a tendency to pull out soon after the fighting stops.

The Environmental Challenge of Global Warming

Climate change is the great environmental challenge facing the global community in the 21st century. According to the Stern Review on the Economics of Climate Change, a major report on the effects of climate change and global warming commissioned by the British government, “The poorest developing countries will be hit earliest and hardest by climate change, even though they have contributed little to causing the problem.”

So far most of the debate about responding to global climate change has focused on mitigation, or how to get the largest carbon-emitting nations to curb their output of greenhouse gases. While this is an important piece of any solution, we must also focus on the more immediate concern of adaptation. For the poorest people, who rely on agriculture for their livelihoods, adapting to climate change is an unavoidable issue now and for the foreseeable future.

Substantial resources are needed to help poor countries adapt to the impacts of climate change. Agricultural research is needed to identify and promote the most appropriate crops and soil management and cultivation techniques. For example, research should focus on drought tolerance and the suitability of alternative crops and on identifying more salt-tolerant varieties of paddy rice, vegetables, and other cash crops in areas facing increased salinization of their water resources.

Oxfam International estimates that adaptation will cost $50 billion annually, more if global emissions are not cut rapidly. The cost of inaction also has to be considered. According to World Bank estimates, if climate change results in a decrease in economic growth of 0.5 percent per year in developing countries, the annual cost in terms of lost income will be roughly $70 billion. Current development assistance budgets would replace nowhere near this amount. It’s important to consider all possible sources of funds to help poor countries adapt to climate change—for example, a tax on carbon emissions at the national level. Under the principle that the “polluter pays” for the damage caused, these additional resources are not development assistance. Rather, the funds are compensation from high-emissions countries to those most impacted.

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