Increasing prosperity for the rural poor in Asia and the Pacific by 2030

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Increasing prosperity for the rural poor in Asia and the Pacific by 2030

©IFAD/Susan Beccio

Rural farmers in India take part in an IFAD-supported project in Maharashtra state, where agricultural distress and farmers’ suicides are pressing issues. There is a widening income gap between rural and urban dwellers in Asia and the Pacific and growing pressure on land, natural resources and the environment.

7 September 2016 - Countries of Asia and the Pacific region (APR) have experienced rapid growth and poverty reduction over the last 25 years. Both the service and manufacturing industries have provided a large increase in employment opportunities across the region. But in spite of the rapid urbanization , more than half of the region’s population still lives in rural areas, and most are engaged in agriculture.

On 14 September, IFAD launches its flagship publication, Rural Development Report 2016: Fostering Inclusive Rural Transformation. The report provides extensive insight into the future development of rural communities and brings together leading thinkers to analyse lessons learned from experiences across the globe, and to look at rural development in a new way.

In the run-up to the launch of the report, Fabrizio Bresciani, IFAD’s Regional Economist for Asia and the Pacific, discusses rural transformation in the region and provides an outlook for the future. 

Q: What are the challenges and opportunities for smallholder farmers in Asia and the Pacific?

“Today in Asia there are three typical worlds of agriculture. First, you have farmers who are located mainly around urban areas, where population growth and the demand for food are taking place at a very accelerated pace. These small farmers are already involved in the commercialization process and are working within value chains to best respond to market demands.

“Then you have farmers who work in areas with good potential for increased agricultural production. The challenge for these farmers is their ability to meet the food quality and safety requirements necessary for integration into modern value chains.  A lot of work needs to be done to help these farmers become viable partners  of the private sector whose investment in marketing and processing will support the supply of food to the growing urban population. Knowledge and technology will drive this process of transformation to produce high-value crops for new food systems.

“Third, you have farming communities that are located in the most remote rural areas, including upland areas, mountains, and islands, with little access to roads, transportation, clean drinking water and basic social services. These farmers may not be able to transform their way of working to supply food to growing urban areas in the near future. They are remote, transportation costs are high and institutional support is often weak.

" IFAD's support  to these farmers focuses on improving their contribution to  local food systems by ensuring that they are sustainable, that the food they grow is nutritious and that communities are involved in the development of the technology they need, and receive the right assistance,  bearing in mind the limitations they face."

Q: Do you believe rural transformation is an effective way to overcome poverty?

“All evidence shows that there is a very strong relationship between rural transformation and poverty reduction. The downside is the impact that increased agricultural production has on the environment. If not properly planned for, agricultural development that is intensive in the use of natural resources can actually undermine the long-term pace of poverty reduction. So it is not only a matter of reducing poverty in the short term, a longer-term plan that integrates social development with the management of natural resources becomes really essential. That is going to be a critical part of the future rural transformation process.

Q: What do countries in APR need to do to shift to sustainable rural development?

“By sustainable, we mean two things: that the rural people are able to make a profit out of farming and from their non-farm activities and there is also environmental sustainability. We face a number of challenges and institutional policies will need to be put in place to protect the resource base and improve on biodiversity.

“Safeguarding forests and improving soil and water management is critical in many part of Asia. Better production practices include more judicious use of fertilizers, preserving the upland-lowland water cycle and limiting water drilling. Also, we will need to invest in technology to develop crops that need less water.

“Water management will continue to be a very important issue in Asia, especially in South Asia, in the more arid and semi-arid environments. There has been an intensive use of groundwater in South Asia and water tables have declined considerably.”

Q: Development in the region has led to a large income gap between mainly urban rich and rural poor. Why do these inequalities persist and what can be done to bridge this gap?

“Smallholders’ access to mechanization, finance, technology and land is critical for them to become more entrepreneurial and more productive. Smallholders who are more productive and entrepreneurial  are the ones who will be feeding the growing urban populations in the coming decades.

“Some farmers are actually losing money from farming but are hesitant or unable to leave agriculture and seek other employment. This means that there are a relatively large number of people farming on limited land. This has had a dampening effect on rural incomes.

In the more dynamic areas of East and South- East Asia, some degree of land consolidation can be expected to happen in the coming decade. For an equitable transformation of these areas, it will make a difference whether such incipient consolidation will be driven by the more dynamic smallholders rather than by the larger farms or through the adoption of corporate models of agriculture.

“There is a steady flow of rural to urban migration in Asia and the Pacific as both the service and manufacturing industries continue to expand. Investing in dynamic economies that create employment and investment opportunities for exiting smallholders in rural areas is essential. Otherwise, farmers who are inclined to exit agriculture will seek employment in urban areas.

“There will be a point when we see this gap closing but that will happen only if we are able to create employment opportunities in rural areas. This will be a gradual process."

About the Report

The Rural Development Report, IFAD’s flagship publication, is a rallying call to policymakers and development practitioners to end poverty and hunger in all its forms everywhere. The report looks at how to bring rural people into the economic mainstream and how to transform rural areas so that development is not only inclusive but also socially, economically and environmentally sustainable.

Stay tuned for the launch of the report on 14 September and follow the conversation online at #ruraltransformation.