Tropentag, October 5 - 7, 2004 in Berlin "Rural Poverty Reduction through Research for Development and Transformation"

Agricultural Policies in Industrialised Countries and Rural Poverty in Sub-Sahara Africa. Is the Link Overvalued?

German Development Institute (GDI), Sub-Sahara Africa, Germany

Abstract

In the context of the agricultural negotiations of the Doha Development Round of the World Trade Organisation (WTO), protectionism and subsidies of industrialised countries are often affirmed to be the main responsible factors for low agricultural prices and rural poverty in Sub-Sahara Africa (SSA). The author examines these allegations on the basis of two SSA countries with distinctive situations:

- Tanzania represents a strongly agriculturally determined economy with a relatively rich endowment of agricultural resources and a positive net agricultural export trade balance.
- Senegal stands for a (at least in a SSA context) relatively urbanised and industrialised economy, which due to lack of dynamics in agricultural development and the degradation of the natural resource base is rather dependent on agricultural imports and shows a negative net agricultural trade balance.

The study uses production, export and import profiles of the countries, reviews important agricultural world markets, and analyses trade and agricultural policies. It is concluded that, although the allegations of negative effects of industrialised countries? agricultural policies on SSA agriculture cannot be rejected, they are most probably not the decisive determinants for the lack of dynamism in these sectors and for rural poverty. More important are the internal agricultural policies of these countries which still have an urban bias, neglect agriculture and the rural areas and do not offer sufficient incentives for investment in rural areas.
It is improbable that SSA will be able to respond to potential incentives from a WTO agreement without a re-dynamisation of the agricultural sector. The most important areas of improvements are: Strengthening the private sector and peasant organisations, improving rural financial systems and credit availability, applied research and extension with due consideration of private sector interests, information and risk management as well as the complex issue of land use / land rights / natural resource management. Macro policies such as exchange rate and regional integration policies, infrastructure, decentralisation and general private sector strategies must take due account of the needs of the agricultural and agro-industrial sectors.

Keywords: Africa, agricultural policy, agriculture, liberalisation, poverty, world markets, WTO

Contact Address: Michael Bruentrup, German Development Institute (GDI), Sub-Sahara Africa, Tulpenfeld 4, Bonn, Germany, e-mail: michael.bruentrupdie-gdi.de