Organic Agriculture as a Strategy for Addressing Rural Poverty in Asia

Rural Poverty In Asia

In 2003, close to 700 million Asians were estimated to be living on less than a dollar a day (ADB, 2005a). Poverty in Asia is largely a rural phenomenon: although the magnitudes and ratios would vary across countries, almost everywhere in the region income poverty is disproportionately higher in rural areas (Table 2 [ PDF 99.3KB | 3 pages ]).

Rural areas are generally worse off in almost every other aspect of poverty and deprivation: people in rural areas tend to have lower levels of health and education; they are more likely to have limited access to basic services such as water and sanitation; and paradoxically, despite depending on agriculture as their main source of livelihood, they also suffer the most from hunger and food insecurity.

The rural poor are also the most affected by environmental degradation: fifty percent of the poor in Asia are found in fragile ecosystems and vulnerable areas (IFAD, 2002), and their livelihoods largely depend on the available natural resources. Environmental degradation reduces the income of the rural poor disproportionately in comparison with the general population. Perversely, as the incomes of the poor shrink, they are left with little recourse but to deplete environmental resources even further, thus precipitating a vicious cycle of ever-worsening poverty and environmental deterioration. This poverty-environment nexus has become prominent in the discussions on sustainable development (Dasgupta, et al., 2003; UNESCAP, 2003)².

While many countries in Asia may be poised to meet the MDGs in 2015, these aggregate gains are not likely to translate into better living conditions for the rural poor unless something is done to re-focus attention on rural poverty and agriculture ³.

Green Revolution and Poverty Reduction

In the past few decades, massive investment has gone into promoting Green Revolution technologies based on the use of chemicals, extensive irrigation, and the use of high yielding varieties, including genetically modified (GM) plant varieties. While there is no doubt that this strategy has led to substantial productivity gains over the past 50 years and has eliminated starvation in many countries, recent evidence shows that the Green Revolution has not been effective as a strategy for poverty reduction for majority of the world's rural poor. While Green Revolution technologies will remain as the major production system in the world, there is growing evidence that the Green Revolution has, at its worst, increased inequality, worsened absolute poverty, and resulted in environmental degradation (IFPRI, 2002).

First of all, while Green Revolution methods have been effective in increasing yields in agriculturally optimal areas, they have been less effective in the case of marginalized and resource-poor areas where farmers have no access to modern inputs and technologies ⁴. (IFAD, 2005b; Scialabba and Hattam, 2002). To quote the FAO (2000):

"Even in Green Revolution regions, numerous small, poorly equipped and very low-income farms were unable to gain access to the new means of production. Unable to invest and progress, they saw their incomes fall as a result of the drop in real agricultural prices. Many of them sank to levels of extreme poverty and were eliminated. Above all, vast hilly and barely accessible regions of rainfed or scarcely irrigated agriculture were essentially bypassed by the Green Revolution. The varieties cultivated in these regions (millet, sorghum, taro, sweet potato, yam, plantain, cassava) benefited marginally, if at all, from selection. The same was true for varieties of major cereals (wheat, maize, rice) that were adapted to difficult local conditions (altitude, drought, salinization, aridity, waterlogging). For example, the average output of millet throughout the world today is barely 800 kg/ha, and that of sorghum is less than 1 500 kg/ha. These so-called "orphan" varieties, having been bypassed by the selection process, make the use of fertilizer and phytosanitary inputs unprofitable, which only adds to the problems of the regions where they are grown."

Second, even in those areas which enjoyed substantial productivity gains, in the long-run these gains did not always translate into sustainable improvements in rural poverty. On the one hand, real declines in the prices of agricultural commodities and increasing crop failures due to pests and diseases resulted in a significant fall in farmers' revenues. Because high yielding varieties often need regular or increasing inputs of chemical fertilizers and pest control, farmers had to borrow heavily in order to sustain productivity. In the long-run, this cost-price squeeze and the declining price trend of commodities in the world market led to significant declines in terms of trade and incomes of farmers.

Third and more importantly, the Green Revolution's gains have come at the cost of extensive environmental degradation and considerable health problems due to exposure to agro-chemicals. As IFPRI (2002) writes: "Excessive and inappropriate use of fertilizers and pesticides has polluted waterways, poisoned agricultural workers, and killed beneficial insects and other wildlife. Irrigation practices have led to salt build-up and eventual abandonment of some of the best agriculture lands. Heavy dependence on a few major cereal varieties has led to the loss of biodiversity on farm". And since these costs are not internalized in the price of food, it is the taxpayers and future generations who will end up footing the bill.

Because majority of the poor are illiterate and have no access to adequate training on agrochemical use, they are disproportionately affected by negative health and environmental consequences of the Green Revolution. The inappropriate use of agrochemicals and the premature introduction of mechanization have led to, in many areas, a deeper level of poverty.

With regards to health, one of the key pillars of poverty reduction, it could also be argued that the poor are in greater need of quality food to maintain or improve their health compared to the average citizen. For the poor, OA systems, which are generally more diversified, could translate into higher levels of nutrition intake.

Given the above-mentioned reasons, low-external inputs sustainable agriculture strategies have emerged as viable alternatives to the Green Revolution, particularly for the rural poor in marginal areas. For farmers living in these areas, any strategy to improve agricultural production must therefore be based on the use of low-cost and locally available technologies and inputs (Pretty, 2002), in addition to being safe for humans and the environment.

Organic Agriculture as a Poverty Reduction Strategy

The worldwide promotion of organic agriculture for poverty reduction was pioneered by farmers themselves and was advocated by NGOs, who worked closely with poor farmers and witnessed the serious negative health and environmental consequences of agrochemicals. More recently, governments and donors have taken note of organic agriculture's potential as a development strategy, due mainly to the following:

1. increasing global demand for safe food and potential price premiums for organic products;
2. under the WTO agreement, food exports must comply with higher phytosanitary standards and OA is more likely to be able to meet such requirements;
3. mounting evidence that OA can improve the incomes and living standards of poor farmers by building on assets which poor farmers have, i.e., land free from intensive use of chemicals, excess labor, and traditional knowledge of production system; and
4. studies which have illustrated how OA can contribute to health, social development and environmental restoration and/or protection.

Demand for safe and organic food is rapidly expanding in both the domestic and international markets. In the urban areas of most developing countries, supermarket chains are responding to increased demand for safe food by contracting farmers to produce crops and livestock organically or with reduced amounts of chemicals.

Many of the poor farmers in remote areas possess a comparative advantage over farmers in intensive areas because the former's current practices are largely organic by default. Unlike their conventional counterparts, they will not require a transition period of 3-5 years before they can be certified organic. This gives them an edge in terms of immediately capturing the benefits of producing certified organic products for the domestic and international markets.

Organic agriculture is likely to benefit the poor living in marginal areas the most, by improving productivity and incomes, and promoting environmental sustainability. In Northern Thailand, contract organic rice farming in marginal forest areas has produced significant livelihood improvements for participating farmers (Setboonsarng, et al, 2005). In Kandy, Sri Lanka, an organic tea project for low-input resource poor farmers has led to favourable environmental outcomes in an area where tea had almost been abandoned (Halberg, et.al. 2006). Even in Europe, organic agriculture is reportedly more likely to be found in disadvantaged areas, or areas unfavorable to conventional agriculture production (Häring, et. al., 2004).

Due to declining commodity prices, countries are choosing instead to specialize in high-value crops, including organic products. Regarded as both an export opportunity and a sustainable development strategy, many Asian countries have formulated or are now in the process of formulating national policies for OA. Thailand, for example, announced the first policy on organic agriculture in 2001 and declared it as the National Agenda in 2005. Bhutan formally declared its National Strategy on Organic Agriculture in 2006.

To the extent that international trade on socially and environmentally beneficial products such as organic products can expand, consumers in developed countries can directly contribute to poverty reduction in developing countries.

Given the multi-dimensional nature of poverty and the broad-base benefits of organic agriculture to the rural poor, the following section reviews the current knowledge on OA's contributions within the context of the MDGs.

Download this Discussion Paper [ PDF 296.7KB| 28 pages ].

Comment(s)

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1. Anthony Zola
   (posted 06 October 2006 / 10:00:45 AM)
   
   Aspects of this paper are based upon a recent international workshop in Bangkok. The workshop was excellent and the proceedings already make an important contribution to the existing literature. This document reflects only one aspect of the discussion, albeit a very important aspect, that of meeting the MDGs and how organic agriculture can contribute to that process.