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Decision and Policy Analysis Research Area – DAPA

Key Messages from the 2011 Rural Poverty Report

Just to add to Katie’s last post, I have summarised some the important messages of IFAD’s findings. Titled ‘’New realities, new challenges: new opportunities for tomorrow’s generation’’, the report highlights a number of prospects and challenges facing the rural poor today.

IFAD, start the report referring to the food price hikes in 2008 and the one earlier in the middle of this year. However, the FAO and OECD have both predicted that food prices are likely to remain at 2010 levels or higher for at least the next decade. Therefore, the immediate concern is food security and the need to formulate policies to feed the estimated 9 billion people in 2050. Current food production will have to increase by 70% to meet the population’s requirements in 2050.

One of the key messages of the report is that rural poverty continues to be a major problem across the developing world. Despite, 350 million rural people being pulled out of extreme poverty in the last decade, 70% of the world’s 1.4 billion very poor people are still rural. The results are also context specific. For example, East Asia has reduced rural poverty substantially, with China being responsible for much of the decline. In Latin America, extreme rural poverty has decreased by more than 50% while in the Middle East and North Africa, rates have fallen by nearly half. However, incidence rates remain high in South Asia and Sub-Saharan Africa.

With Globalisation and the rise of countries such as Brazil, India and China as major world players, agricultural markets are continually evolving, where there are now clear incentives to invest in the countryside of developing nations. The importance of rural economic development is emphasised with data from studies: “a 1 percent growth in GDP originating in agriculture increases the expenditures of the poorest 30 per cent of the population at least 2.5 times as much as growth originating in the rest of the economy.” IFAD recognises the development and support of smallholder agriculture as one of the best solutions to rural poverty and maintaining sufficient food supply. Moreover, IFAD states that the stereotypical perceptions of smallholders need to change. Rather than being viewed as “charity cases’’, small scale farmers need to be seen ‘’as people whose innovation, dynamism and hard work” can bring prosperity to their communities.

Climate change, state fragility, ill health, insecure access to land and natural resource degradation are all cited as ‘risk’ factors that the rural poor face. Apart from agricultural markets, IFAD believes the rural non-farm economy and migration are methods, which communities use to diversify income and reduce risk. Nonetheless, what remains critical is for donors, NGOs and policymakers to design effective policies to build sustainable market relations for smallholders. The report ends on this note: ‘’If all these stakeholders want it enough, rural poverty can be substantially reduced. What is at stake is not only the present for one billion rural people and the prospects for food security for all, but also the rural world and the opportunities within it that tomorrow’s rural generation will inherit”.

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