''Poverty reduction is not something that governments, development institutions or NGOs can do for the poor. The poor themselves have to seize responsibility, as agents of change, for their own development.''

Emerging Themes and Challenges

• Most of the world’s poor are rural, and will remain so until at least 2035. The urban-rural gaps in poverty, health and literacy are large and, on the whole, not narrowing. These gaps are not only unjust but also inefficient: shifting resources, assets and access from urban to rural, and from rich to rural poor, often advances economic growth.

• The extremely poor spend almost three quarters of their income on food. They receive over two thirds of their calories from staples and earn perhaps half of their income from growing them. So the control of farmland by the poor tends to be a safeguard against extreme poverty.

• The rural poor require access to competitively marketed inputs and services and to research, roads and other resources that normally only governments can supply.

• Water-yielding assets are also increasingly important to the rural poor as more areas are affected by water scarcity and diversion.

• The heavy biases against rural people, the poor and women in acquiring ‘human assets’, especially health and education, are inefficient as well as unjust, and in some cases are not shrinking. Reducing these biases and providing the poor with access to land and improved farm technology are complementary; each increases the economic gain and poverty reduction from the other.

• The value of human, land, water-yielding and other assets depends on the technologies that turn those assets, together with labour, into adequate incomes. The poor’s shortage of assets, compels them to live mainly by selling their labour-power. So increasing the market value of that labour-power, through choices in asset-building and in technology that are employment-intensive, is vital for poverty reduction.

• Rural technologies face two tasks: to reduce poverty through more and better-distributed output and welfare; and to improve resource sustainability. On the whole, the former has been best achieved by bioagricultural research, and the latter by improved land and water management technology. The two are strongly complementary though separated by fashion and by barriers between researchers and institutions.

• The poor need technologies to increase output from their assets, and they also need markets to exchange that output freely and to best advantage

• The poor are largely excluded from the institutions and partnerships that can enable them to share and control the decisions that affect their lives. Channelling appropriate assets such as land and education, technology to raise the productivity of assets, and markets to improve sales and purchases, improve the poor’s ‘exit options’ that over time may also help them alter institutions for their sustained benefit.

• Coalitions of the poor among themselves and with others provides the best hope for them to become integrated with a process of sharing wealth and development more equitably than before. The best guarantee of good policy is effective accountability.

• If the target of reducing extreme poverty by half by 2015 is to be achieved, overall development assistance must be raised and the share going to agriculture should reflect its importance in generating livelihoods for the majority of the poor. Once that condition is met, the challenge is to develop and foster genuine cooperation, good governance and a policy framework in which the rural poor in developing countries can participate.

Future Outcomes of Success, Future Outcomes of Failure

The future outcomes of rural poverty could be worsened by matters not reviewed in this report, such as increasing war or civil violence, or worse-than-expected effects of AIDS or global warming.

Success in reducing mass poverty in low-income countries initially depends on progress in farm yields and employment, and later on a transition towards employment-intensive non-farm products, coupled with a fall in the number of people engaged in agriculture and increased urbanization.

Improved small-scale agriculture in developing countries is essential for meeting immediate poverty reduction targets. It can also contribute decisively to the overall development process, including the emergence of new opportunities for income and employment in other sectors.

This report documents great progress in the reduction of rural poverty, but shows a worrying slowdown and a failure to reach large areas. The sources of progress lie in getting assets, appropriate technologies and market access to the poor, and in the latter obtaining more influence on decentralized and national-level institutions.

For further information contact:

At.Rahman@ifad.org or G. Geissler@ifad.org
Corporate Strategy Unit

Prepared by the Communications and Public Affairs Unit
IFAD, Via del Serafico 107, 00142, Rome, Italy
Tel: (00) 3906 5459 2485, Fax (00) 3906 5459 2143
E-mail: communications@ifad.org