Agriculture and Rural Development H.S.Dillon Partnership for Governance Reform In Indonesia October, 2005

Sine qua non for genuine development Poverty Alleviation Enhanced rural labor productivity Rural infrastructure development Provision of basic services – education and health Productivity increase via among others vocational training

Ladder out of Poverty Institutions and infrastructure linking rural and urban economies Educational systems answering the local needs Accessible and affordable health service systems Adequate food and nutrition Conception control

The Indonesian Experience: Success Drivers Rural infrastructure development Family planning Provision of basic services  Primary schools throughout the country (SD Inpres – free primary school)  Health services down to sub-district level (Puskesmas – free health services) Provision of agriculture inputs – accessible to all farmers in terms of availability and prices Institutional development (BIMAS – Panca Usaha)

The Indonesian Experience: Institutional Failure  Market failure  Government Failure Poor quality of Institutions Economic Crisis  Private debt became public debt  Declining competitiveness  Neglected agriculture

Vietnamese Successes and Future Challenges Successes: Rapid agriculture growth: coffee, dry latex, forestry products Rapid rural poverty alleviation Contributing Factors: Land distribution to individual households Commodity trade liberalization Rural road access development Challenges: Raise productivity to even higher level : R&D, remote regions & ethnic minority Globalization and Vietnamese agriculture Accede WTO – market access, negotiations Coordinate donors effectively

Future Critical factor Governance Government PrivateSector CivilSociety Sustainable Partnership Transparency Participation Accountability

Future Strategy Creating sustainable livelihood  Strengthen local capacity  Clear vision and good plan of action