Millions Fed: Proven Successes in Agricultural Development

Expanding the role of markets

In spite of these successes, many developing countries still suffered from slow growth, general economic malaise, and persistent food insecurity throughout the 1980s. A shift to more market-driven development took hold in many countries during this period. In some countries, this shift came in the form of structural adjustment programs that sought to rein in public deficits, improve national balances of payments, liberalize markets, and encourage private investment in the economy. In other countries, this shift occurred after the recognition that efficient supply chains played an important role in improving the production incentives for farmers, increasing incomes from farming, and improving food security. Market forces were expected to contribute to agricultural development, for example, by freeing up seed and fertilizer markets from state-owned monopolies, by removing price-setting policies in agricultural commodity markets to encourage more vibrant trading, and by closing the supply chain gaps that link farmers to markets.

In Bangladesh, government moves to liberalize agricultural input markets in the 1980s led to an easing of restrictions on the importation and sale of irrigation equipment, such as low-lift power pumps and shallow tubewells. These seemingly minor reforms stimulated the rapid growth of irrigated dry-season rice farming, which subsequently grew to account for 90 percent of the increase in rice production in Bangladesh between 1988 and 2007. And with this growth in rice production came a decline in the real rice prices facing food-insecure households and ultimately significant reductions in poverty in the country.

In China, policy reforms that promoted private investment in agriculture, along with breakthroughs in rice research, fostered the growth of a vibrant seed industry for hybrid rice. Hybrid rice in China spread so quickly that between 1978 and 2008, it had grown to account for 63 percent of all land under rice cultivation. Importantly, its yield advantages helped China to feed an additional 60 million people per year during this period.

In India, similar policy reforms and scientific advances in the mid-1990s encouraged the growth of private investment in the marketing of improved seeds for pearl millet and sorghum, including hybrids. These two crops are essential sources of sustenance and income for some 14 million poor households in India. Although together they account for just 10 percent of the total cropped area in India, they are cultivated in the country’s arid and semiarid regions where nearly 60 percent of the rural population lives. The emergence of private seed companies, combined with good public research, has provided an estimated 6–9 million farmers with access to improved seeds that have increased yields by up to 85 percent in recent decades.

Reforms in Burkina Faso’s cotton sector that began in 1992 brought together experiences from both market liberalization and cash crop development as drivers of success in agricultural development. Saddled with a state-led cotton development strategy that was branded as inefficient, inequitable, and destabilizing to the national economy by the late 1980s, Burkina Faso pursued a reform path that combined efforts to strengthen the role of cotton farmers’ groups before partially liberalizing input and output markets. Partly as a result of these reforms, and despite consistently low world prices for cotton, Burkina Faso has emerged as the leading African exporter of cotton based on a threefold increase in production since the early 1990s. The cotton sector’s growth has absorbed more than 200,000 new farmers who were either engaged in the cultivation of other crops or were return migrants from neighboring countries experiencing civil strife.

In Kenya, policy reforms in the early-1990s contributed to the rapid growth of private investment in fertilizer and maize marketing, the outcome of which has been a dramatic reduction in time, effort, and costs associated with purchasing fertilizer and selling surplus maize production. The average distance that small farmers had to travel to purchase fertilizer decreased by half between 1997 and 2007, with similar decreases observed in the distances traveled to sell maize. The proportion of small-scale farmers using fertilizer on maize during the main growing season rose from 56 percent in 1996 to 70 percent in 2007, contributing to an increase in both yields and availability of this vitally important staple crop for Kenyan consumers.