Underlying Causes of Poverty in Agriculture CARE Poverty Workshop 16 th June 2010 Dr George Welton

The Problem Low input = Low output

4 Main Causes Structural – irrigation, size of land-plots, credit, government policy and funding Education – in production, markets, finance Social – Collective and social action Markets – imports, closed or hard to access export markets

Structure Land-plots – Less than 1 hectare of cropped land – Split between 3-4 different plots – Land as a source of security – 2 million hectares of undermanaged land Irrigation – WB project repaired physical structures – Needs local management – Amelioration Associations

Structure Credit – High cost – Banks unprepared to use land as guarantee – Fear of debt – for reasons of security Government – MoAg about 1% of government spending – Unclear policy on agricultural priorities – Centralisation of decision making – Little local government capacity

Education 908 people trained in agricultural in VET Centers in 2009/2010 across the country – No national system for training small farmers – Little infrastructure for community-based education of farmers – Few community based associations Little information on new markets and prices Little information on business planning

Social Capital and Local Communities Inability to work collectively – Failing amelioration associations and low payment for irrigation – Little collective management of farm machinery – Higher input prices and lower use of inputs – Lower sales prices Few Community Based Organisations – Little knowledge transfer – No input into management of shared resources or protection against disease Little interaction with central/local government – No input on management of shared resources like land – Little information or input on management for disease risk

Community Organisations can help… Farm Associations…. Can utilise and manage assets… Can buy cheaper inputs Can collectively sell outputs Can share knowledge o On goods o On markets and prices

Other Community Organisations Amelioration Associations Needed to… Build trust in the system and local ownership Collect fees from small farmers for irrigation Maintain small infrastructure Agricultural Service Center Needed to: Access to reliable inputs Source of expertise and advice Even small machinery

CLOSED Growing exports Similar products Cheaper products West: Supply Issues

Exports doing better slowly… Official Exports

2009 Exports $70 million nuts $15.7 Citrus – mostly manderins $32 million wine $54 million Spirits (mostly Cognac)

2009 Exports surprises Live animal exports $42, $34 million CattleSheep Azerbaijan Egypt 0.4 Lebanon 3.8 Saudi Arabia 9.3 Armenia 0.8 Jordan 1.1 Total Exports (Million USD)

Food Imports and Exports (Million USD)

Imports….still space to substitute

Meat Imports 2009 $37 million mostly from USA $12 million mostly from Brazil and Canada $10 million mostly from India

Vegetables $2.6 million Milk, dairy and honey $24 million. Most milk is powdered and VERY cheap $3.5 million$3.7 million Onions and garlic $3.8 million

Conclusions Even infrastructure is social and needs community ‘buy-in’ if it is to be beneficial to poor communities Widening participation and ensuring security is essential for strengthening markets Import substitution in food appears to offer the greatest opportunity for pro-poor growth in the medium term

Thank you