Along with more than 400 others I attended this forum (http://www.adb.org/Documents/Events/2010/Investment-Forum/default.asp) held in the ADB headquarters July 7-9, 2010.
It's amazing what a spike in food prices will do stimulate new interest in agriculture, which had largely dropped off the radar of many funding agencies. However, as I listened to the presentations I worried that lessons from past public sector support for agriculture (often only partly successful or unsuccessful) may not have been learned.
But my first thought was that many did not recognize that the spike in food prices was probably the best thing to happen for small farmers in years. There's nothing like higher prices to raise incomes of farmers. Of course, consumers, and in particular poor consumers suffered as a result of the higher prices. But in terms of benefiting small farmers, nothing replaces higher prices for their output as a means of increasing incomes.
The lessons I see as "not yet learned" include the following:
- Agricultural production and marketing and all activities associated with these are business and therefore the role of the private sector. The role of governments and public sector agencies should only be supportive of private sector activity and not seeking to replace it. However, this reality does not yet to have been accepted by most governments (the Government of Laos was a refreshing exception) and development agencies. There has been some move towards the position "that there must be a prominent role for the private sector." Wrong, the private sector must drive agricultural output and productivity growth.
- The unstated "vision" of those government officials and politicians attending the event, along with most development agencies and community service organizations is that development of agriculture in the developing world will see millions of poor small farmers become millions of not poor small farmers. This will just not happen. Nowhere at no time has agriculture developed in this manner. An increase in agricultural output and productivity will be associated with an aggregation of farms, rural depopulation and increased mechanization. This will happen in developing Asia and the Pacific. Sure there are technologies that will slow down this process and help small farmers improve their incomes in the meantime and this is great. However, policy makers must accept that rural transformation is inevitable and therefore plan for it. This transformation is generally not resisted by smallfarmers few of whom probably want their children to follow them into farming. For the most part their vision is education for their kids and a job somewhere else.
