"Focusing donors on eradicating worldwide poverty is paramount if we are to have any hope of helping people cope with future catastrophes like the one currently being experienced in Asia", says Lennart Båge, President of IFAD, a specialized agency of the UN exclusively devoted to fighting rural poverty.
"Invariably when natural disasters strike it is the poorest people who suffer the greatest hardships," says Båge. "These poor communities have lost everything to the Tsunami, but the degree of resilience demonstrated is remarkable. We have seen local people show incredible determination to cope with this calamity. But to help them get back on their feet, IFAD believes that development assistance should not be limited to providing immediate relief but should also help build the communities' skills and assets for the future."
According to Ganesh Thapa, Regional Economist of the Asia and the Pacific Division of IFAD: "The Asian Tsunami has destroyed the livelihoods of millions of fisherfolk, farmers and other rural populations, pushing them into extreme poverty. Tragically, countries like Indonesia and Sri Lanka are likely to see major reversals in their recent gains in lifting people out of poverty and it will take them years to get back to that level of development".
Poverty must move up policy agenda
More than a billion people worldwide live in absolute poverty, most without access to clean water and without enough food to feed their families.
In ten years time, the UN's Millennium Development Goals should have been met, following commitments made by virtually all countries of the world at the United Nations in 2000.
At the present rate of progress, many countries, especially the poorest nations – those that are landlocked or least developed – will not reach their targets by the 2015 deadline. The depth of the crisis is made clear in the Millennium Project Report, Global Plan to Achieve the Millennium Development Goals, which will be presented to the UN Secretary-General, Mr. Kofi Annan on 17 January. However, the Global Action Plan also states that the MDGs can be realized by 2015, even in the poorest countries, if the international community takes immediate action to support them, actions which are outlined in the Plan.
Poverty is central to all the MDGs. Many believe these eight measurable and time-bound goals represent a new political consensus on the way forward and an unprecedented opportunity to confront the world poverty crisis once and for all.
The challenge is to ensure that there are enough resources and that these resources are used effectively. "We need to look at what poor people actually do to ensure their economic survival and direct our resources to assist them in their endeavours. We are not talking about hand-outs. The rural poor want accessible financial institutions for saving and borrowing, usable technologies, control of the land and water they rely on for a living, and fair opportunities for selling their produce," says Gary Howe, IFAD Chief Development Strategist.
IFAD believes the achievement of the MDG goals will be compromised unless investment is channelled into supporting people in rural communities to direct, manage and control their own circumstances. The issue is not just more resources, but resources and opportunities that are directly in the hands of poor people themselves.
Tackle rural poverty first
Ironically, it is the people who produce the world's food who tend to be the poorest and most food-insecure: three-quarters of those living in extreme poverty - about 900 million people - live in rural areas and depend on agriculture and related activities for their livelihoods. In most developing countries, the agricultural sector is the main employer, job creator and export earner. Historically, in many parts of the world, agriculture has been the engine that has driven economic growth. Yet today that economic engine has been stalled in many of the poorest countries. In sub-Saharan Africa, one of the poorest areas of the world, 60-70 percent of the population depends to some degree on agriculture; in the United Kingdom, one of the wealthiest, the figure is a mere 3 percent.
Many poor rural farmers are denied access to land, water, credit, markets and the other basic resources they need to survive. They are not able to compete in selling their produce in local markets because the markets are flooded by cheap produce from subsidized producers in wealthier countries. Moreover, because of poverty and lack of appropriate technologies, they are often forced to use cultivation practices that destroy the very soil they work.
IFAD argues that the MDGs can only be realized only if these food-insecure, extremely poor rural people are prioritized in the war against hunger and poverty. The agency urges all countries striving to achieve the MDGs to focus on rural development as a priority.
Expanding financial assistance to rural poor
Agriculture and rural development are vital to the economies of most developing countries. Yet the share of public expenditure on this sector does not reflect this reality. According to one UN study, in countries where more than 35 percent of the people are undernourished, annual government expenditure per agricultural worker averages US$ 14-50 times less than the amount spent in countries with the lowest rates of undernourishment. Where there is undernourishment and inadequate government spending, there is low productivity and continued poverty: the same study has estimated that productivity is 20 times lower in these countries.
Although 35 years ago, wealthy countries agreed to commit a standard of 0.7 percent of their gross national product to official development assistance (ODA), in 2002, the level of ODA was a mere 0.23 percent. And today, only about eight percent of this bilateral ODA goes to rural development. Development Assistance Committee ODA commitments for agricultural production has fallen substantially from 23.2 percent in 1994 to only 4.7 percent in 2002.
The British Government's recent "Why We Should Care" campaign and focus on progress in Africa is timely, with aid to Africa overall having dropped since 1995. But more than just aid is needed, according to IFAD. To bring about lasting change, greater political commitment is needed and more equal trade relations.
International trade challenges
There is a pressing need to review international trade regulations and barriers; an agenda that has suffered many setbacks and stalemates in recent years. IFAD believes it is vital and increasingly urgent to give developing country producers access to export markets.
"Rural poverty will be overcome by what poor rural people do for themselves. To succeed they need more assets – but they also need better opportunities to use their assets profitably. They need a policy environment at local and global levels that gives them a fair chance. One of the key lessons of the past is that what has been given in aid has been effectively taken away in other areas, not only through debt repayments, but unfair trade regulations that have crippled farmers in the poorest countries."
The role of government
"From our experience, poor rural people want to develop knowledge, skills and organizations to access resources and services, to be able to negotiate with private-sector market intermediaries, and influence government policies and investments", says Gary Howe. "Here, governments can play a critical role in financing and training smallholder farmers and rural communities to establish their own institutions".
Such locally run institutions already include "farmer field schools" to access and evaluate new agricultural technologies; village banks and rotating savings and credit associations to access financial services and build informal small businesses; water users associations to manage irrigation systems; and farmers organizations to negotiate with market intermediaries. Without such institutions, the rural poor will continue to be denied the means to escape poverty.
Increasingly, developing country governments are moving away from providing services and regulating agricultural markets, towards free market liberalization.
Rural producers now must be able to operate and deal directly with private service providers if they are to run viable economic activities such as purchasing seeds, fertilizers, pesticides or the services needed to market produce (eg wholesale purchasing, transport, packaging quality control etc.). Previously these commercial activities were often taken care of by government or semi-publicly owned cooperatives. Now they are increasingly in the private sector and their prices are not fixed but market determined.
In this shift, the role of government should be to provide an "even playing field"; strategic planning and good governance to create the right policy environment, to redress the common bias in favour of urban areas and in particular to provide infrastructure and social services to disadvantaged rural areas.
Scoring the goals
"The Millennium Project Report shows that the MDGs are still within reach at a global level. IFAD agrees that the goals can be met, provided that all the right levers of change – political, economic, social and scientific – are pulled to accelerate progress. Primary responsibility lies with the developing countries themselves, who need to link their national plans to the MDGs and ensure that poor rural communities are involved in the planning processes. At the same time, the MDGs are a collective responsibility, and within the world's collective power to achieve, not merely at the rhetorical level but at the practical level if there is political commitment," says Båge.
Many of the material problems faced by poor rural people are well recognized and demand a response. But for IFAD it is only by strengthening local communities' capacity and opportunity to manage and control their circumstances that lasting change will come about. "All areas of action should be viewed through the lens of poor people and their livelihoods. Helping poor rural people to help themselves is the way forward, and the only hope of making poverty a thing of the past," says Båge.
Gary Howe, Chief Development Strategist for the United Nations agency, the International Fund for Agricultural Development, will be in London on Friday 14th January for advance interviews. Contact Juliet Heller on 01621 868083 or 07946 616150 or Juliet@julietheller.co.uk to schedule.
IFAD headquarters contact: Farhana Haque Rahman, Chief, Media Relations, Special Events and Programmes
Tel: 39-6-5459-2485/2215
Email: F.Haquerahman@ifad.org