Underlying Causes of Poverty in Agriculture CARE Poverty Workshop 16 th June 2010 Dr George Welton

1. Underlying Causes of Poverty in AgricultureCARE Poverty Workshop 16th June 2010Dr George Welton

2. The Problem Low input • = Low output Farms

3. 4 Main Causes • Structural – irrigation, size of land-plots, credit, government policy and funding • Education – in production, markets, finance • Social – Collective and social action • Markets – imports, closed or hard to access export markets

4. Structure • Land-plots • Less than 1 hectare of cropped land • Split between 3-4 different plots • Land as a source of security • 2 million hectares of undermanaged land • Irrigation • WB project repaired physical structures • Needs local management – Amelioration Associations

5. Structure • Credit • High cost • Banks unprepared to use land as guarantee • Fear of debt – for reasons of security • Government • MoAg about 1% of government spending • Unclear policy on agricultural priorities • Centralisation of decision making • Little local government capacity

6. Education • 908 people trained in agricultural in VET Centers in 2009/2010 across the country • No national system for training small farmers • Little infrastructure for community-based education of farmers • Few community based associations • Little information on new markets and prices • Little information on business planning

7. Social Capital and Local Communities • Inability to work collectively • Failing amelioration associations and low payment for irrigation • Little collective management of farm machinery • Higher input prices and lower use of inputs • Lower sales prices • Few Community Based Organisations • Little knowledge transfer • No input into management of shared resources or protection against disease • Little interaction with central/local government • No input on management of shared resources like land • Little information or input on management for disease risk

8. Community Organisations can help… Farm Associations…. • Can utilise and manage assets… • Can buy cheaper inputs • Can collectively sell outputs • Can share knowledge • On goods • On markets and prices

9. Other Community Organisations • Agricultural Service Center • Needed to: • Access to reliable inputs • Source of expertise and advice • Even small machinery • Amelioration Associations • Needed to… • Build trust in the system and local ownership • Collect fees from small farmers for irrigation • Maintain small infrastructure

10. CLOSED West: Supply Issues Similar products Growing exports Cheaper products

11. Exports doing better slowly… Official Exports 2004-2009

12. 2009 Exports $15.7 Citrus – mostly manderins $70 million nuts $54 million Spirits (mostly Cognac) $32 million wine

13. 2009 Exports surprises Exports (Million USD) Live animal exports 2007 - $42,000 2009 - $34 million

14. Food Imports and Exports(Million USD)

15. Imports….still space to substitute

16. Meat Imports 2009 $37 million mostly from USA $12 million mostly from Brazil and Canada $10 million mostly from India

17. Vegetables Milk, dairy and honey $24 million. Most milk is powdered and VERY cheap Onions and garlic $3.8 million $2.6 million $3.5 million $3.7 million

18. Conclusions • Even infrastructure is social and needs community ‘buy-in’ if it is to be beneficial to poor communities • Widening participation and ensuring security is essential for strengthening markets • Import substitution in food appears to offer the greatest opportunity for pro-poor growth in the medium term

19. Thank you