Partner to Feed the Planet

By 2050, there will be more than 9.6 billion people in the world – a world of finite resources. Today, these resources are already under pressure from climate change, urbanization and a growing population. Given the size of the challenge, a logical conclusion would seem to be that a large-scale problem requires a large-scale solution, and thus that to achieve food security demands large and heavily mechanized farms.

And yet, it is not so. In fact there is no reason why small and medium-sized farms cannot contribute to a stable food supply in the developed and developing world alike. And there are many reasons why they should. The organization that I head, the International Fund for Agricultural Development, or IFAD, was founded nearly 40 years ago on a belief that smallholder farming was key to food security, and our experience has borne that out.

IFAD is an international financial institution and a specialized United Nations agency with a total membership of 176 countries, including the Russian Federation. Our goal is the elimination of poverty and hunger through agriculture and rural development. We work in some of the most remote regions of developing countries where few aid agencies have ventured, and where poverty and hunger run deepest. Since 1978, we have provided nearly $16.6 billion in grants and low-interest loans to projects that have reached about 445 million people.

More than 2 billion people depend on the world’s 500 million small farms. Collectively, they are responsible for around 80 per cent of food production in developing countries. Yet the very people who grow the food often go hungry themselves. A lack of opportunities and resources leaves them with few options to improve their lives. Some will continue to flee to cities or abroad in search of work, but where they face an uncertain future. Without focused attention and investment in rural areas, we will not be able to build stable food systems or stable societies.

We need our rural areas, and in the future we are going to need them even more – to grow more food, and to maintain the ecosystems that contribute to clean water and air. Cities cannot be healthy if our rural areas are not. By making it possible for smallholders to invest in their businesses, we can not only improve income, food security and nutrition, but also transform rural areas so that they are places where people can earn dignified and decent livings.

Thrice as more effective

At IFAD we believe that farming, at whatever scale, is a business. Small farms need what other businesses need: roads, clean water, electricity and an Internet connection, markets, access to finance, knowledge and information. But often they don’t have it. That’s why IFAD invests in rural people – so that farmers can farm more efficiently, so that they are more resilient, and so that the rural space is more attractive to young people.

To transform rural areas requires a partnership that includes both the private sector and governments. For example, the challenge of food security calls first and foremost for more public investments in rural infrastructure and agricultural services, as well as for better access of farmers to inputs, technology, credit and markets. Private investments are crucial too, in particular for establishing profitable and sustainable value chains.

Investment in agriculture has been estimated to be at least three times more effective in reducing poverty than investment in other sectors. The investments we make spread outward and create further opportunities, stimulating the rural economy and strengthening communities. In Armenia, for example, the company SIS Natural began producing fruit juices in 2000. In 2012, it received an equity investment and a subordinated loan from an IFAD-supported programme, the Fund for Rural Economic Development in Armenia (FREDA), to buy technology for hygienic bottling and to invest in specialized training for staff. In addition to SIS Natural, FREDA has invested in a winery, fish farming, sheep and poultry production, and a milk-processing plant, among other initiatives. As a result, the number of people employed by the FREDA investee companies has increased by 35 per cent, the value of purchases from rural suppliers has risen by 560 per cent, and households selling to the companies have seen a 53 per cent increase in income from sales.

Not all rural people are growing food. Diversifying agricultural production and developing off-farm activities are also essential to development. New production lines - such as livestock, aquaculture or horticulture - as well as new activities like the processing or transformation of commodities and local products create new income opportunities, including for women and youth. In Tajikistan, poor rural families raising angora and cashgora goats are improving their breeding stock and learning better ways to process fibres through an IFAD-supported programme managed by the International Centre for Agricultural Research in the Dry Areas (ICARDA). The programme works at the household level, to increase goat productivity and improve fibre quality, and with women to spin finer quality fibres. Using the new technologies, rural women in Northern Tajikistan have more than doubled their incomes from fibre processing and are starting to sell to markets in Europe and the United States.

These examples illustrate that development must be done in partnership between producers and the public and private sectors. At IFAD we call this ‘the four Ps.’ Equitable partnerships bring together the interests of all parties in ways that are mutually beneficial and transparent. It is up to governments to create favourable policy environments and provide vital infrastructure. The private sector gains on the supply side and farmers benefit from links to secure markets, as well as gaining access to technology, services and knowledge. In this way, smallholders are better positioned to benefit from existing and new markets. And when communities are thriving and stable, everyone benefits.

In places as varied as Azerbaijan, Ghana, Tanzania and Thailand, experience has shown that smallholders can contribute to food security and lead agricultural growth. But they need investment and they need an enabling environment to do so. The decisions of policymakers today will have a major effect on whether we can feed the future; so will the willingness of the private sector to engage with small farmers; so will the actions of international development agencies.

We are not just investing for today, but for tomorrow. By ensuring that no region is forgotten and no person marginalized, we can build resilience and stabilize supply. It is our best, indeed our only hope of feeding every person on the planet.