Agriculture, natural resources and trade Promoting sustainable development in SIDS Espen Ronneberg Inter-regional Advisor for SIDS Division for Sustainable Development DESA, United Nations

Overview Derives from Barbados Program of Action –SIDS are a special case for environment and development –constraints on natural resources and carrying capacity of SIDS –influence of outside factors - vulnerability –special concessions –recommendations from lessons learned

The special case of SIDS

Barbados Program of Action 1994 Conference mandated by Agenda 21 Clear articulation of the constraints and opportunities faced by SIDS International recognition of the special case of SIDS for environment and development Also, the vulnerability of SIDS given prominence

What was stated? On trade, recognition of dependence on overseas markets Taking into account the poor market access and reliance on single commodities Special efforts are needed to assist SIDS to increase their production and exports International community should assist with diversification

How? SIDS should establish national land use plans and integrate planning –watershed and coastal protection –enforce existing laws –implement diversification –international action on coordination, inter-regional support and training

Successful? Sustainable development is ongoing struggle and countries have different starting points - same, same - but different –large islands - smaller islands –coral atolls, volcanic islands –distance to markets –one commodity or diversified (tourism, finance, shipping, fishing)

Reasons for lack of progress Cooperation has been limited –some regions have established frameworks, but have found difficulties in implementing –lack of sufficient financing –lack of information –insufficient support from international community

Are there common issues? Sustainable development in context of SIDS –SIDS face the same constraints but to different extent –SIDS have different resources but are affected by similar externalities Natural resources endowments vary –yet there are similar sectors where experiences can be shared –sugar, copra, fisheries, forestry, tourism

What are the common constraints? Smallness, remoteness, geographic dispersion, vulnerability to natural hazards, population structures, mobility Reliance on single or a few commodities Dominance of a few sectors (tourism, fisheries, bananas)

Agriculture in SIDS Great variation, but theme of single export commodities prevail, with some subsistence for local consumption Effect of tourism on local consumption and production varies Involvement of stakeholders - central planning and cooperation varies

Maldives Coral atolls, archipelago Tourism is dominant sector of economy Resorts almost 100% dependant on imported foods and beverages Ripple effect in rest of economy, relating to cost of agricultural production, wages in tourism sector

Cook Islands Coral atolls and large islands, archipelago Tourism is major sector of economy Rarotonga resorts purchase locally produced vegetables and fruits - hydroponics Ability to compete with cheaper imports, as well as creating internal markets and cooperation will determine success

Barbados Single large island Tourism is large sector of diverse economy Agricultural production has remained steady on aggregate between 1984 and 96 Enormous changes in the export and production profile - less raw sugar, more rum

Natural resources endowment SIDS have wide differences Yet common sets of issues emerge –Often subject to outside driven exploitation –Market prices not set locally –Very often raw materials are exported, not value- added goods

Trends in agricultural exports FAO has documented steady decline –in returns for primary product exports –in agricultural productivity –in purchasing power resulting from agriculture Agriculture sector as an employer declining –tourism more lucrative –it is hard work, and sector is mechanizing

Potential for diversification Important consideration for exports –Fruits and vegetables during northern winter –Niche markets –Inter-SIDS trade or import substitution –Value-added processing

Recommended activities –Integrated land resources planning and management –Sustainable farming systems –Plant protection and new crops –Post-harvest handling and new crops –Marketing and credit –Institutional development –Technical co-operation

Trade preferences in favour of SIDS Lome and Cotonou US Caribbean Basin Initiative US Freely Associated States LCD preference of Nordics

Benefits for SIDS? Assessment of effectiveness –other forces at play –special interests often block comprehensive benefits Preferences being greatly eroded by trade liberalization Monetary benefits vs. structural effects caused by single commodity economies

Impact of liberalization Assessment of commodity prices shows –decline in returns –substitution –competitiveness of small producers down Yet, marketing as “natural” or “green” could have added benefits

The challenge Liberalization will affect exports - need for thorough analysis of SIDS impacts Diversification potential Learn from other developing countries Take full advantage of existing access Establish SIDS cooperative arrangements

Thank you