IFPRI Report
Volume 19, Number 2
June 1997
An Overview of Food and Agriculture in Latin America
As the countries of Latin America have embarked on sometimes painful changes in development strategy in the name of structural adjustment, the engine of growth has shifted from the state to the market. Reforms have included decentralization of government, privatization, and deregulation of markets. How have these changes affected the food and agricultural system, the linchpin of sustainable growth? Will these changes help Latin America confront the severe problems that stand in the way of achieving the 2020 Vision in the region—problems such as poverty, inequality, food insecurity, malnutrition, deterioration of the environment, and rapid urbanization?In IFPRI's 2020 Discussion Paper 21, Challenges to the 2020 Vision for Latin America: Food and Agriculture since 1970, James L. Garrett highlights the accomplishments and difficulties experienced in the region over the past 25 years and describes the actions required if Latin America is to eradicate poverty, hunger, and malnutrition and use its natural resources efficiently and sustainably by the year 2020.
In the 1970s and 1980s, Latin American countries were piling up huge external debts to finance domestic consumption. When interest rates rose sharply, these countries suffered economic collapse, and incomes fell by 10 percent on average. Governments were forced to become market oriented. By the 1990s, per capita GDP had stabilized in most countries, and the region had a growth rate of 3.1 percent. But in 1990 46 percent of the people in the region still lived in poverty, the same share as in 1970.
The most striking features of poverty in Latin America and the Caribbean, according to Garrett, are the wide gap between rich and poor in the distribution of income, land, and opportunity and the shift in the locus of poverty from rural areas to the cities. The share of income going to the poorest 40 percent of households is only about 8 percent in Brazil, Guatemala, and Honduras. Despite recent economic setbacks, nutrition is generally better than in other developing regions, although serious problems remain in some countries, including Ecuador and Peru.
Even though more than 70 percent of Latin Americans now live in cities, the region possesses a strong comparative advantage in world markets in its agriculture and natural resources. Even in highly urbanized countries, the food and agriculture system accounts for at least 25 percent of economic activity. Small farmers, an important part of agriculture in the region, commonly produce up to a third of basic staples such as maize and beans on less than 15 percent of the cropland.
Looking toward 2020, the principal challenge for agriculture will be to increase its competitiveness while protecting the natural resource base through the use of environmentally friendly technologies. Among the steps that need to be taken to achieve the 2020 Vision, the discussion paper recommends these actions:
- Invest in human capital, particularly education, health care, and sanitation.
- Open channels for citizen participation and strengthen municipalities.
- Develop infrastructure for transport and communications, and strengthen financial systems.
- Develop, through research, technologies to raise agricultural productivity and incomes, especially for small farmers. (ISBN 0-89629-604-0, 38 pp.)
