Small Scale Farmers Agricultural Contribution
Developing or third world countries, as they are known, are said to all have one common characteristic. They are known to be characterised by agrarian based economies. This is a common trend amongst them although others have almost left this trend and are being referred to by various terms such as ‘newly industrializing countries’ and so on. Developing countries are also said to have a population mainly consisting of people in the rural areas.
The aim of this essay is to highlight the role that the agricultural and rural sectors play in the development process of developing countries. To achieve this, it shall begin by defining the main concepts. It shall then go into the main discussion, bringing to light the role that is played by small scale farmers as well as the conditions required for the development of the agricultural sector. Finally, a conclusion shall be drawn based on the discussion. Perhaps one major concept to begin with is that of development.
According to Todaro (2003:826) development is defined as the process of improving the quality of all human lives encompassing three important aspects, namely: raising peoples living levels which includes basic needs such as food, income, medical services and education; creating conditions conducive to the growth of peoples self esteem; and increasing peoples freedom by enlarging the range of their choice of consumer goods and services. Development must basically aimed at satisfying human needs by improving the quality if people’s lives as can be drawn from this definition.
The agricultural and rural sectors of LDCs through various techniques are meant to contribute to the development process. The agricultural sector is of great dominance in both the social and economic spheres of the third world. As with regards to the rural sector, the majority of the population of the third world live in the rural areas. According to Todaro (2003:452) people living in the country side (rural areas) comprise considerably more than half the population of diverse Latin American and Asian nations.
In Africa, there are even much higher ratios with most countries having rural dwellers in excess of three-quarters of the total population (ibid). The people of these rural areas are highly dependent on agriculture. This includes farming in crops, animals and poultry at subsistence level. In Zambia particularly, it is approximated that over 56% of the population are rural dwellers. Over 90% of these are dependent on agriculture for their livelihoods. Of the total population of the country, the percentages of those living below the poverty line are 80% and 34% in rural and urban areas respectively.
The representation in terms of employment is 79% in the agricultural sector and in the case of exports, the agricultural sectors caters for 39% contributing 20% to Gross Domestic Product (GDP). There is therefore need to look at ways of developing these sectors so that they are able to contribute much more to the well being of LDCs, hence the concepts of agricultural and rural development. Todaro (op. cit) advances that if development is to take place and become self- sustaining, it will have to require the rural areas in general and the agricultural sector in particular.
In order to determine the role that the agricultural and rural sectors play in the development process of the third world, it must be found out as to how agriculture contributes to economic growth, and especially to pro-poor growth (Meijerink, 2007:2). The focus on pro-poor growth is because the rural areas, where agricultural activity is most significant, are where the poorest of the poor are said to be found. Figures have shown that in LDCs there are relatively more poor people in rural areas than in urban areas (ibid).
These include women and children and women are said to be the most vulnerable. It is important that these people feel the impact of economic and socio-cultural growth by improving their lives in all aspects. This can only be achieved by putting in extra effort to see to it that there is development in the two sectors. Agricultural growth reduces poverty through direct impacts on farm incomes and employment (Byrlee, 2005:4). In the early stages of development, the agricultural sector is regarded as a vital to a country’s development process.
This is because it provides the primary needs of man such as food and raw materials and also caters for the input requirements of industry. In order for the agricultural sector and eventually the rural sector to develop, a number of things must be put in place. There is need for proper strategizing through such things as advancement in the forms of agricultural inputs and more funding in the sector. There is also need to increase agriculture based employment, total marketed products in the sector as well as an increase in exports.
According to Mellor (1986) an agricultural and employment based strategy of economic development requires a minimum three basic complementary elements: accelerated output growth through technological, institutional and price incentive changes designed to raise productivity of small farmers; rising domestic demand for agricultural output derived from an employment oriented urban development strategy; and diversified, non-agricultural, labour intensive and rural development activities that directly and indirectly support and are supported by the farming community.
The agricultural and rural sectors play a number of roles in the development process of LDCs if well developed. Firstly, broadening of the agricultural productivity growth base raises the incomes of poor farm households as well as households of landless laborers who primarily depend on agricultural wages (). A large body of empirical studies of the green revolution in Asia demonstrated how agricultural growth reached large numbers of small farms, increased demand for rural labor, and lifted enormous numbers of people out of poverty
An increase in agricultural productivity also brings strong indirect benefits for the poor. What seems to be the most significant pro-poor linkage is generated by the effects of agricultural productivity growth on food prices (Timmer 1997). The poor typically spend a high share of their income on staple foods, and therefore they benefit from a productivity-induced decline in the real prices of staple foods. Benefits are largest for the urban poor and landless laborers, but even many poor farmers benefit, since they are net food purchasers.
Agriculture is important to the incomes of the rural poor, as is the case in most countries at the early stages of development. When there are increases in the incomes of farmers and farm workers as a result of agriculture, the levels of poverty are also reduced by providing a market for labor-intensive consumer goods. Another role that the agricultural sector plays in the development process is that it produces raw materials needed for production in the industrial sector. As is known, the industrial sector is essential to economic growth and development.
As market is created for agricultural products, income is created for the farmer which improves the well being of most of them who are on small scale and found amongst the rural poor. Furthermore, agricultural products always have a ready market. Therefore, as Mier (1964) advances, there is an increase in production in the agricultural sector which leads to an increase in the jobs in the rural sector, where there are several farms, as well as a further reduction in poverty levels.
Furthermore, rural income growth from increased crop production can have multiplicative effects on a region when that income is re-spent on local goods and services that would not otherwise have had a market outlet. Backward and forward linkages are therefore created between the agricultural with the non-agricultural sector. These linkages which are as a result of increased spending of farm incomes are known as agricultural growth linkages and they have shown to be an important element in the creation of rural industry, for instance in Asia following the Green Revolution in production of cereals.
Agricultural growth can further lead to strong multiplier effects in the non-farm economy. Agriculture makes other important contributions to nutrition, food security, and macroeconomic stability beyond the pro-poor growth linkages (Timmer, 2002). At the micro level, inadequate and irregular access to food reduces labor productivity and decreases investment in human capital (Will, 2007). Drawing on a sample of 97 countries, Nadav (1996) found that nutritional levels had a large and highly significant impact on economic growth.
Furthermore, when there is food security, it entails that the whole country benefits as there is easier access to food for all which enables an active and healthy life for all. Food security also aims at ensuring adequate storage resources even for off-season crops as well as processing of food crops to cater for the poor people in these rural areas in times of hunger. Food security further aims at ensuring that markets as well as marketing incentives are in existence so that food commodities are channeled to areas that are experiencing shortages in food.
Moving on, Small-scale farming has a crucial role to play within the agrarian sector. In most countries domestic markets offer more opportunities for smallholders than international markets. Small-scale farmers are mostly subsistence producers of staple food and sometimes have surplus which they sale at the local markets. For instance when travelling between towns in Zambia, it is common to see several traders at the road side selling various crops produced by the small scale farmers. Equitable access to land and secured rights to land are essential prerequisites to enable small scale farmers to benefit from agricultural development.
It is estimated that small-scale farmers function on less than two hectares of land which contribute to about 75% of farm holdings (PRSP 2002:12). As small-scale farmers continue to produce, they can be catalysts for local development processes. This is derived from their superior efficiency and productivity of diversified small scale farming systems, positive impact on staple food production and supply of local markets, and their minimal use of capital-intensive external inputs. Furthermore, as they increase their production, small-scale farmers of today contribute to the creation of backward and forward linkages in the economy.
More production entails that they must add in extra inputs for greater outputs. These inputs include fertilizers, tractors, pesticides and herbicides as well as other farming inputs. In this instance there is a backward link for the small holders to the manufactures of those products and a forward link for the manufactures to the smallholders. In reference to the linkages above, an example can be given as to how small scale farmers provide raw materials to the manufacturers. Small-scale dairy farmers supply fresh milk to manufacturers who process and package the milk for sale at wholesale level.
This milk is then sold to retail shops who then sell it at retail price for consumers in the urban areas. Besides milk, other dairy products are manufactured such as cheese, ice-cream and butter. For instance, Parmalat Zambia Limited buys milk from thousands of small farm most of which do not have many cows. The main reasons farmers give to sell their milk to Parmalat are because of the existence of a written contract, good reputation, high trust, and timely payment. In the meat industry, Zambeef Plc also buys cows and other animals from small-scale farmers in Zambia.
The meat bought from the farmers is then processed and packed for sale at retail level to consumers in the urban areas at higher prices. The above contributions made by the agricultural and rural sectors with the help of small-scale farmers can be further improved. Essential conditions for the sound development of the sector can be cited. Firstly, there is a need for effective market linkage programs that would help small-scale farmers secure long term supply contracts with regular buyers for a win-win situation.
Implementation of such a measure would encourage the farmers to expand their production to ensure to ensure that they constantly have produce ready to be supplied. In China for instance, Suguo supermarkets, which rank among the top three retailers in China, has a procurement system which is based on written contracts with small-scale traders, who in turn have oral agreements with farmers (Berdegue, 2008:25). Suguo has even established a firm base in the countryside both in terms of procurement and consumption. Public policy can be a vital factor in promoting smallholder farmer participation in dynamic markets.
Smart subsidies and institutional change fostered by public policy can be used to; encourage private sector firms to source from small-scale farmers; provide support services to small-scale farmers such as technical assistance and access to certification schemes; provide direct financing to small-scale farmers or to facilitate their access to financial services provided by others; adjust the development of private grades and standards so that the cost of compliance does not lead to widespread exclusion; or invest in community development (Berdegue, 2008).
For instance, a dairy policy that was being discussed in the Kenyan parliament has signaled a clear departure from the old and ineffective command and control approach to regulation of the informal and traditional milk markets (ibid). Another essential condition would be changing farmers’ mindsets by helping treat farming as a business and not part of their tradition or culture. This can be done by helping them adopt good agricultural practices and also to raise productivity. Such can be ensured by setting up programs in rural areas which can educate the smallholders on enhanced methods of farming.
Through public policy emphasis must be placed on areas that can make growth more pro-poor. These include institutional mechanisms (for example, strong producer organizations) to connect small-scale farmers to emerging markets, investment in education and skills of the rural poor to promote their participation in the emerging high-value agricultural subsector and dynamic rural nonfarm sector, mechanisms to manage a massive exit from small farms in Asia, attention to increasing the productivity of food production in Africa, and, in situations of highly unequal land distribution, market-based approaches to land redistribution (op. it). Finally, an enduring challenge is to increase the voice of the rural poor in national policy dialogue. Widely-owned rural strategies and decentralized programs now offer good prospects for achieving this goal. Improving small-scale agriculture through technology and innovation is another essential condition. According to Todaro (2003:484) in most LDCs, new agricultural technologies and innovations in farm practices are preconditions for sustained improvements in levels of output and productivity.
Many LDCs have increased output in the past without these elements but rather by simply extending cultivation into unused but potentially productive lands. Most of these old methods have however been exploited by now and there is not enough scope for further improvement (ibid). An example of such old techniques is the Chitemene System of shifting cultivation practiced in northern Zambia. This practice involves cutting of trees, burning them and using the ash as some form of fertilizer. This method and others have been overused over the years and is now ineffective.
Two major sources of technological innovation that can increase farm yields are the introduction of mechanized agriculture to replace human labour and the other is the use of hybrid seeds, irrigation techniques and chemical innovations such as fertilizers, pesticides and insecticides (op. cit). Furthermore, when the above are innovations are put in place, there is need for strengthening institutions that are responsible for providing services on standards, packaging and product development.
There is also need for improvement in infrastructure (road network and communication) especially in the rural areas as well as improving information flow providing assistance to traders with finance so that they are able to buy produce from farmers. The two measures here can also be considered to be essential conditions for the sound development of the sector. From the examples above, it can be seen that public policies and external support programs favouring inclusion can be very pro-poor and very pro-market at the same time.
They can also be pro-poor and be implemented by private sector actors. Small-scale farmers need to be included in the various policies that will ensure that their contribution to the development process through agriculture is one of great significance. In conclusion, the agricultural and rural sectors have a huge role to play in the development process of developing countries. Ways in which this is or can be achieved have been highlighted in the essay as well as the role that small-scale farmers found in the rural areas and whose lives are dependent on agriculture play.
The essay has further brought out conditions that are seen to be essential to improving the overall development of the agricultural sector. As has been pointed out in the concept of development, what is important is for the positive effects of development to be centered on the well being of the people. It must therefore, in the case of developing countries, be ensured that the overall development of the nation resulting from agricultural and rural is felt by the poorest of the poor who in the case of this essay are those in the rural areas.
BIBLIOGRAPHY Berdegue, Julio A et al (2008). Regoverning Markets: Innovative Practice in connecting Small-Scale producers with Dynamic Markets. London: International Institute for Environment and Development (IIED) Meijerink, Gerdien and Pim Roza (2007). The Role of Agriculture in Economic Development. http://www. boci. wur. nl/UK/Publications Mellor, John. W (1986). Agriculture on the road to Industrialization. Washington D. C: Overseas Development Council. Mier, G. M (1964). Leading Issues in Development Economics.
London: Oxford University Press Nadav, C. (1996). Nutritional Thresholds and Growth; Processed. Department of Economics, Ben-Gurion: University, Israel. Todaro, Michael P, Stephen C Smith 2003. Economic Development. Pearson Education Ltd, New Delhi, India. Timmer, P. (1997). “How well do the Poor Connect to the Growth Process. ” CAER Discussion Paper No. 178, Harvard Institute for International Development (HIID), Cambridge, MA. Timmer, P. (2002). “Agriculture and Economic Development,” In Handbook of Agricultural Economics, Vol. 2.
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