AFRICAN AGRICULTURE and RURAL DEVELOPMENT

ECON 3510May 27 and June 1. 2010

Arch Ritter

Brooke Bond Tea Estate, Kenya

Coffee Gathering, Kenya

Agroforestry, Kenya

AgendaI. Importance of Agriculture and Rural

Areas in DevelopmentII. Varying Agricultural Systems in AfricaIII. Africa’s Recent Agricultural RecordIV. Agriculture’s Contributions to

DevelopmentV. Small scale "Peasant" or Subsistence

AgricultureVI. Revised Strategies: Main ElementsVII. The Land Reform Issue in Africa

I. Importance of Agriculture and Rural Areas in Development:

1. All people have to eat; i.e. agriculture and food are of key importance

2. Large proportions of populations are in agriculture and rural (64% in Africa, 2007)

3. Disproportionately large numbers of rural people are poor, however this is measured

4. Rural activities earn or save foreign exchange5. Rural people save and invest6. Rural people constitute a reservoir of

entrepreneurial talent

II. Varying Agricultural Systems Africa

General Features:a) Role of Women in farmingb) Importance of non-agricultural rural activitiesc) "Home-based” enterprised) From "traditional" to "modern,"

Partial commercialization virtually everywheree) Complex rural-urban interactions

e) Institutional Formsa) Small-scale family farming, communal property; b) Small-scale family farming with private ownership c) Some export-oriented commercial farmsd) Corporate farmse) Occasionally some state farms: few nowf) Foreign Sovereign Ownership (by governments or state

enterprises)

Kenya: Central Province

Kenya: Western Province

III. Africa’s Recent Agricultural Record: Some Positive Achievements

Measure 1990-02 2003-2005Food Production Index

(1999-2001 = 100.0)76.9 107.2

Crop Production Index (1999-2001 = 100.0)

75.5 106.1

Livestock Production Index (1999-2001 = 100.0)

83.1 108.8

Cereal Yield (kg. per hectare) 1003 1228

Agricultural Productivity ( $ Value Added per Worker)

$262 $278

World Bank, WDI, 2009, p 144,

Some negatives:

Longer term decline in food production per capita

(see chart) From net agricultural exporter to net importer

1970 Net Exports: + $ 3.2 billion1999 Net Importer - $ 3.8 billion

General lag in improving agricultural productivityContinuing relative economic deprivation in rural

areasRelative neglect by public policy and investment

IV. Agriculture’s Contributions to Development

A. Earlier Views in theorizing of 1950's and 1960's (e.g. Lewis; dependency approach; Soviet model, …)

– Supplying foodstuffs to other sectors (the “agricultural surplus”)

– Releasing surplus labour to the “modern sector"– Providing a surplus for investment (savings) to the

“modern sector”– Earning foreign exchange– Providing a rural market for the urban industrial sector

[Note: these functions were largely passive and extractive, with the main emphasis being focused on in the urban industrial modern sector.]

B. Policy Consequences of these earlier views:• focus on modern industry in urban areas and ignore agriculture

and rural areas• use agriculture to service the modern sector with outflows of

people, food and savings• discriminate in favour of modern industrial sector and against

agriculture and rural areas (i.e. "Urban Bias”) re. • Taxation patterns• Food pricing policy• Infrastructure investment • Tariff and non-tariff barriers• Social expenditures • Credit policies• Exchange rate policies

B. More Contemporary Views Emphasizing Agriculture:

Rural Development Agriculture should be emphasized for the following reasons:

1. To raise rural income, because poverty is over-represented in rural areas;

2. Rates of return are often higher in parts of agriculture than other sectors;

3. Rural entrepreneurship can serve as a strong foundation for economic improvement and “pro-poor” development;

4. Non-agricultural informal sector activities can also be valuable for income generation;

5. Increasing agricultural output can stimulate linked industrial and service sector activities;

6. Reinforcing the traditional cultures (language, arts, music, handicrafts, and "ways of life") which are often to be found in rural areas.

VI. Small scale "Peasant" or Subsistence Agriculture

1. Older views regarding peasant agriculture

2. The theory of the optimizing peasant (Michael Lipton)

3. Issues of Land Use and Tenure: Fragmentation of land holdings Population pressures, fragmentation and land

degradation Gender and Tenure: Men Own the land; women

work it! Insecurity of tenure and variable farm incomes

obstruct access to credit;

VII. Current Views Regarding Rural and Agricultural Development Policies:

• Farm people can be innovative in the right policy and institutional environment;

• Aim for “broad-based rural development” focusing on rural people;

• Design “pro-poor” rural development strategies

How can agriculture-for-development agendas best be implemented? By designing policies and decision-making processes suited to each country’s economic and social conditions, – mobilizing political support, and – improving the governance of agriculture

What are effective instruments in using agriculture for development? They include – increasing the assets of poor households, – making householders—and agriculture in general—more

productive, creating opportunities in the rural nonfarm economy that the rural poor can seize.

VII. Revised Strategies: Main Elements

1. Support “green revolution” innovations: – Emphasize improved seed varieties for higher

productivity;– Adaptive biological research and agricultural

extension [Note CGIAR]– Emphasize agro-forestry in many places;– Irrigation, maybe drainage;

2. Emphasize complementary services:– Credit;– Marketing support; – Relevant technical and agricultural education

VII. Revised Strategies: Main Elements, cont’d

3. Emphasize employment creation and anti-poverty types of investment in agriculture and related rural activities;

• Infrastructure investment in rural areas for job creation and public usage (roads, irrigation, drainage, dispensaries, water availability, social infrastructure)

• i.e. rural public works, employing rural people;• But avoid large scale labour -displacing mechanization

4. Don’t discriminate against agriculture and rural areas in general public policies;– Aim for a “level playing field” re specific

policies;Taxation patterns; Food pricing policy; Tariff and non-tariff barriers; Exchange rate policiesSocial expenditures; Credit policies;

VII. Revised Strategies: Main Elements, cont’d

5. Support rural non-agricultural and often “informal sector” economic activities in rural areas;

6. Agrarian and/or land reform where appropriate;

7. Supportive social institutions: • schools, • health centres, • Farmers’ co-operatives,

8. Emphasize also environmental sustainability in rural areas and agriculture

VII. Revised Strategies: Main Elements, cont’d

1. Land tenure and land reform: Definitions2. Complexities of African land tenure structures3. Varieties of Land reform

– Privatizing Communal Lands?– Breaking up large estates?– Consolidation of mini-farms?– Other property arrangements: Co-operatives?

4. The politics of land reform5. Some issues of dividing large scale agricultural

properties

VIII. The Land Reform Issue in Africa

VIII. The Land Reform Issue in Africa, continued

A. Institutional Formsa) Small-scale family farming, communal

property; b) Small-scale family farming with private

ownership c) Some large commercial and/or export-

oriented farmsd) Corporate farmse) Occasionally some state farms: few nowf) Foreign Sovereign Ownership (by governments or

state enterprises)

Note:None of the land tenure systems is perfectStrengths and weaknesses of each system:

Small-scale family farming, communal property; Small-scale family farming with private ownership

Some large commercial and/or export-oriented farms

Corporate farms

Occasionally some state farms (Ghana, Tanzania, Zambia): few now

Foreign Sovereign Ownership (China)

B. Do communal land tenure systems need “reform”?

Disadvantages of communal tenure:– Reduces security of tenure, and therefore investment &

productivity?– Prevents land-based credits– Reduces mobility of farmers; prevents strangers or

newcomers obtaining land– Men control the land, insecurity for women though

women often do a disproportionate share of the farm work

– Innovative farmers access to additional land may be blocked

Is tenure reform needed for communally-held lands?

• Type of tenure change re communal lands:Land registration and “Titling”

• Aimed at increasing security of tenure or land rights• Promoting “marketization” of land

Conclusion in text:• “The effect of land tenure reform on land-use

patterns, control, and credit and investment has been …. minimal.”

• Institute land reform “only if necessary” due to the difficulty of implementation and uncertain results

C. Breaking up Large Estates, Latin American Style

Arguments in favour of land redistribution:• Equity of income distribution• Efficiency of land use: are large farm units inefficient”

– Complexity of issue– Sometimes yes, sometimes no.

Implementation Difficulties• Should the large units be broken up?• Who should receive the small holdings?• Complementary reforms are necessary (training, some

infrastructure, marketing. Input provisioning…..) • Political Complexities

Two Cases:

Kenya’s “million acre scheme”Quite successful, re equity and production

Zimbabwe, 2004-2009Major disaster;

Politicized distributionOutput volumes severely reducedProductive employment impaired

Conclusion

IX. The Six “I”s of Agricultural Development:

1. Incentives 2. Innovations3. Infrastructure4. Institutions5. Initiative6. Inputs