Underlying Causes of Poverty in Agriculture

CARE Poverty Workshop 16th June 2010

Dr George Welton

The ProblemLow input

Farms

= Low output

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

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

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

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

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

Community Organisations can help…Farm Associations….

•Can utilise and manage assets…

•Can buy cheaper inputs•Can collectively sell outputs•Can share knowledgeo On goods o On markets and prices

Other Community Organisations

Amelioration AssociationsNeeded to…•Build trust in the system and local ownership•Collect fees from small farmers for irrigation•Maintain small infrastructure

Agricultural Service CenterNeeded to:•Access to reliable inputs•Source of expertise and advice•Even small machinery

CLOSED

Growingexports

Similar products

Cheaper products

West:Supply Issues

Exports doing better slowly…Official Exports 2004-2009

2009 Exports

$70 million nuts

$15.7 Citrus – mostly manderins

$32 million wine $54 million Spirits (mostly Cognac)

2009 Exports surprises

Live animal exports2007 - $42,0002009 - $34 million

Cattle Sheep

Azerbaijan 16.5 2.1

Egypt 0.4

Lebanon 3.8

Saudi Arabia 9.3

Armenia 0.8

Jordan 1.1

Total 16.9 17.1

Exports (Million USD)

Food Imports and Exports(Million USD)

Imports….still space to substitute

Meat Imports 2009

$37 million mostly from USA

$12 million mostly from Brazil and Canada

$10 million mostly from India

Vegetables

$2.6 million

Milk, dairy and honey $24 million.

Most milk is powdered and VERY cheap

$3.5 million $3.7 million

Onions and garlic $3.8 million

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

Thank you