The food crisis of 2008 was a stark warning that the world cannot afford to overlook agricultural development. The number of people living on our planet is rising rapidly. Food production will need to increase by 50% by 2030 to meet growing demand. The impact of climate change and urban expansion means that demand will have to be met using less land and water, and without cutting down more forests for agriculture. Support to agriculture should not be an emergency intervention only exercised in times of crisis.
Historically, agriculture has been a proven engine of economic growth and wealth generation, from 18th century England to 21st century Viet Nam. Studies show that GDP growth generated by agriculture is two to four times more effective in reducing poverty than growth in other sectors. Sustainable agricultural development can also guarantee longterm food security, and contribute to climate change adaptation and mitigation.
In the current financial crisis, as in most crises, the poorest people are the most vulnerable. There are 1.4 billon people living on less than US$1.25 a day. Some 75% of these extremely poor men, women and children live in rural areas of developing countries. The World Bank estimates that today's financial crisis has pushed an additional 50 million people into poverty, on top of the 150 million people who are thought to have fallen into poverty and hunger as a result of last year's food and fuel crises. This is further jeopardising the first Millennium Development Goal of halving the number of people living in extreme poverty and hunger by 2015.
In addition, remittance flows-which are a lifeline for many poor rural people-are being reduced by the economic slump. In some developing countries, as much as 20% of GDP comes from remittances. The World Bank has estimated that remittances, which were $305 billion last year, could fall by 5% to 8% in 2009. Migrants, who once were able to send money home, are returning to their villages in developing countries, having lost their jobs abroad. There has been a significant reversal of rural-urban internal migration within some countries. In China, an estimated 10 million migrants have returned to their villages after losing their jobs in urban centres. For the International Fund for Agricultural Development (IFAD), the global recession further underscores the urgency of our work. IFAD is an international financial institution and a specialised United Nations agency dedicated to creating the conditions for poor rural people to lift themselves out of poverty.
At IFAD, we believe that the question of who produces the world's food is crucially important. Most of the world's smallholder farmers are struggling to live on less than $2 a day. Supporting them would enhance world food security and make a significant dent in poverty. Leaving them out of the equation will push many more people into greater poverty, desperation and hunger.
Agricultural development, by its very nature, must always respond and adapt to changing political, social, economic and climatic conditions. As part of our response to the current financial crisis, IFAD is creating even more economic opportunities in rural areas. In China, for example, an IFAD-supported project is addressing the return of migrant workers by helping to expand standard agricultural production, such as raising pigs and growing rice, as well as assisting farmers in moving into more niche production of chestnuts, fruits and tea.
Farmers are stepping up their work in more knowledge-intensive areas, such as greenhouse and organic farming. The IFAD project is also helping farmers organise new co-operatives to improve the quality of their produce, and create better links to markets and more opportunities to increase their incomes. IFAD recognises the need for a concerted, comprehensive and co-ordinated effort by the international community to ensure food security.
It plays an active role in the High Level Task Force on the Global Food Security Crisis, established by the United Nations Secretary-General in April 2008. The task force produced a Comprehensive Framework for Action that aims to ensure that the international effort is well planned and co-ordinated. IFAD now hosts the Rome hub of the Task Force's Secretariat. As an advocate for poor rural people, IFAD is also doing its best to ensure that agriculture and the needs of smallholder farmers remain at the top of national and international agendas.
But governments of developing countries themselves must play their part by investing more in agriculture and implementing supportive policies. Domestically, government investment in agriculture in developing countries has fallen about one third in Africa and as much as two thirds in Asia and Latin America since the late 1970s. Where national governments are mobilising their own resources, donor countries must support them by following through on their aid commitments. At Hokkaido, Japan, in July 2008, the G8 leaders pledged to reverse the decline in aid to agriculture-from around 20% of all aid in the 1980s to less than 5% in 2007. The pledge by G20 leaders in London this April to dedicate $50 billion of the $1.1 trillion rescue package to lowincome countries will go a long way towards helping the world's poorest people, who spend as much as 80% of their income on food and have no safety net.
If the ultimate goal is to create a world that is more secure from economic, social and climate crises, world leaders must return their focus to food security-and keep it there.
For more on IFAD's work, see www.ifad.org
See also www.oecd.org/agriculture
© OECD Observer No 273 June 2009