The World Development Report 2008 edited by the World Bank deals with agriculture for development. It is the first time in the 25 last years that the report is dedicated to agriculture. The WDR 2008 has been published on 19 October, it is avaible on the World Bank website. Below, the proceedings of the presentation of the WDR 2008 that took place on 26 june, more details avaible very soon.
Also see the article "Presentation of the World Bank’s 2008 World Development Report “Agriculture for Development” about the presentation that took place in Paris on 8 November 2007
The World Bank’s World Development Report 2008 was presented on June 26, 2007 at the headquarters of Agropolis International in Montpellier France by Alain Choppin and Elisabeth Sadoulet, two of its authors, on the occasion of a meeting presided by Henri Carsalade, president of Agropolis and Bernard Bachelier, Director of the foundation FARM. The Report, which is the object of a great deal of anticipation, is currently being finalized and is on schedule for publication in October of this year.
The primary objective of the 2008 edition is to restore agriculture to its role as a primary tool for development, a place it has not occupied in the Bank’s Reports since 1982. The 2008 Report contains a theoretical analysis of what agriculture has contributed to development in the Southern hemisphere in addition to concrete recommendations for implementing development policies based on the agricultural sector.
Agriculture remains fundamental for development, with varying effects depending on the context.
Agriculture has different effects on development depending on the nature of a country’s economy. The Report groups developing countries into three categories, in function of the importance of agriculture in the national economy and of the share that rural poverty represents in the overall poverty of the country. The three groups are comprised of those countries whose economy is based on agriculture (mainly subsaharan Africa) ; those countries whose economy is in transition ; and those countries whose population is primarily urban.
According to the Report, accelerated economic growth in countries whose economy is agriculturally-based occurs as a result of a revolution in the productivity of small-scale farms. The problem of income disparity, which is characteristic of countries in economic transition, can in part be met by promoting a high-value-added agriculture, as well as by the dissemination of the green revolution to the more remote areas of the country. In any case, the improvement of small farmer incomes is achieved by increasing productivity and the corresponding reduction in the need for labor, which means that a portion of farm labor is released into the labor markets of other sectors. The authors therefore call for public policies that include measures to help farm laborers make the transition to other sectors as well as actions to decentralize economic activity towards rural areas. Lastly, for urbanized countries the Report recommends developing modern food markets and encouraging the participation of small farmers in these markets, while also creating jobs in rural areas.
Environmental issues occupy a significant place in the report at least to the extent that – in developing countries – these issues have a direct impact on GDP. The authors cite the example of Zimbabwe where a strong correlation can be observed between a decrease in annual rainfall and a lowering of GDP. The authors conclude that it is vitally important to reduce the ecological footprint of developing countries and at the same time to improve the impact on climate of agricultural production systems in poor countries. In addition, since agriculture provides environmental services, it can play a useful role in promoting forms of development which are friendlier to the environment. The authors feel that such a type of development will come from eliminating supports that have negative external effects, from a better definition of property rights, and from more widespread use of conservation technologies. In addition, research and investment efforts should be brought to bear on developing the resilience of agricultural production systems – making them more resistant to shocks – and on encouraging markets for environmental services. It should be noted that the Report calls for both a green revolution and for environmentally sound agriculture, without explaining how these two approaches can be combined in the same model of sustainable agriculture.
The current context is favorable to using agriculture as a tool for development.
The Report’s authors consider that the context in the South has become favorable to a development approach based on agriculture ; macro-economic indicators are up, as is demand for high-value-added agricultural products, and technological innovations are becoming available to developing area agriculture. New opportunities in agriculture open new avenues for rural populations to escape poverty, populations that include small farmers, salaried agricultural workers, migrant workers, and non-agricultural workers. In other words, agriculture can provide ways to increase incomes and improve food security for large numbers of peasant farmers growing food crops and unskilled farm workers. But the success of agricultural policies and therefore of development strategies will ultimately require filling in the gaps in current agricultural governance at all levels : local, national, and worldwide.
Several recommendations for development through agriculture.
According to the Report, agricultural subsidies can be a useful tool for development and against poverty, if available resources are used as efficiently as possible. Accordingly, farm aid can help in cases of temporary market failures, it can curtail fixed costs which are too high, or limit risks associated with production, but subsidies should only be utilized for brief periods and should not become permanent. The authors underline that farm aid does not in itself constitute an agricultural policy but ought instead to be integrated into an overall policy structure. Likewise, tariffs and other protective mechanisms should be treated as development tools, making it possible to improve the competitivity of various sectors, but always on the condition that their use is limited in time. In any event trade barriers are not always a good idea since in a number of countries the poor are net consumers of agricultural products. From an overall perspective, therefore, the benefit to agricultural producers of a rise in prices on local markets may be more than offset by the loss of revenue suffered by poor consumers.
Current debate on the impact of subsidies in developed nations on the agriculture of poorer countries is heated. The Report’s authors claim that fully liberalized trade worldwide on grain markets would have the effect of raising world prices by a mere 5%. In other words, trade liberalization will have at best a minor impact on farm incomes, while real improvement in those incomes must come from investment, whether public or private. In cotton, however, full liberalization – including the elimination of domestic subsidies – would raise world prices by 20%. As a result, the WDR 2008 calls for a rapid conclusion to the Doha Round while concluding that all in all investment represents the principal engine of agricultural development.
The WDR 2008 is the result of a widespread consultation with many different scientific teams. The World Bank hopes to integrate the findings formulated by the Report in a broader project that would generate specific case studies including recommendations for policy applications. This Report will undoubtedly have an impact worldwide and will increasingly influence funding and financing institutions as they move to expand investment in agriculture.