Against a background of increasing food insecurity, agriculture in developing countries must undergo a significant transformation in order to increase production and respond to climate change. It is estimated that feeding 8.2 billion people – an additional 1.4 billion – in 2030 would require raising overall food production by some 50 per cent between 2005/07 and 2030. Feeding a larger urban population in a context of increasing scarcity of land and water, while also adopting more sustainable production methods, is a daunting challenge. In Africa, where it is predicted that population levels will double during the same period, the challenge will be even more acute.
The uncertainty concerning the future of food supply has propelled a growing number of investors and finance companies to acquire large parcels of productive land in many developing countries, particularly in Africa, for the purposes of commercial production, longterm investment, or speculation. Investors expressed interest in 42 million ha of land globally in 2009 – of which 75 per cent were in sub-Saharan Africa. A conservative estimate is that at least 6 million ha of additional land will be brought into production each year up to 2030.
It should be noted that hunger and malnutrition are due not so much to the unavailability of food as to the inability of the poorest members of society to access it at an affordable price. Feeding the world by 2030 requires on the one hand efforts to increase food production and therefore food availability, and on the other measures to ensure that the poorest and most marginalised sectors of society have the purchasing power to access what food there is available.
Seventy-five per cent of the world’s poor and undernourished people are located in rural areas and depend on agriculture directly or indirectly for their livelihoods. Five hundred million smallholder farms worldwide are supporting around two billion people, or one third of humanity. There is an extensive literature and persuasive evidence to suggest that measures to improve smallholder farmers’ capacity to increase food production and productivity, as well as to link to markets, will not only enhance their purchasing power but also increase wider food availability and so contribute to global food security.
Nevertheless, this vision does not go unchallenged. The surging investors’ interest in Africa has triggered a debate over the relative advantages and disadvantages in Africa, and worldwide, of large-scale versus small-scale farming models. The debate has been further stimulated by the leading development economist Paul Collier, who argued that much of the focus on smallholders might actually be hindering large-scale poverty reduction, and that current policies ignore one essential factor for labour-productivity growth: successful migration out of agriculture and rural areas. According to Collier, the international food system and agricultural production technology have changed in favour of larger-scale ventures. The benefit of size is that it facilitates commercialisation.
Debates which polarise small-scale versus large-scale models, or, if we consider the systems of production, ‘LEI – Low External Input’ agriculture versus ‘HEI – High External Input’ agriculture have obscured the potential of building on complementarities and the existence of multiple pathways to achieve agricultural growth and sustainability. Betting on one model only and adopting a one-size-fits-all approach is unlikely to be appropriate, given the heterogeneity of institutions, and agro-ecological, farming and demographic conditions across developing countries.
Achieving the objectives of increased food production and food accessibility, and at the same time protecting the environment, requires adopting a different blend of policies, a four-pronged approach, aimed at the following:
• Supporting subsistence (family) farmers to cope with risks and vulnerability.
• Empowering small investor farmers with the necessary capacity, finance, and regulation to increase their productivity, production, and competitiveness, and in turn to contribute to food security.
• Making large investments pro-poor, by setting the right framework.
• Building on complementarities between large and small farms, when possible.
A four pronged approach is instrumental at achieving food security from the production angle, increasing productivity, resilience and sustainability of farming systems. It should be noted though that important gains can be achieved also looking at demand side, processing of food, waste management, consumption patterns and habits. Nevertheless, the analysis of these important aspects goes beyond the scope of this paper.
Starting from a definition of small-scale farmers (which include subsistence (family) farmers, and small investor farmers) and large-scale farmers, as well as a definition of production systems (LEI and HEI agriculture), Section 2 of this paper will attempt to compare the advantages and constraints of these systems and assess the economic, social, and environmental impacts so far.
A major challenge confronting farmers is to increase agricultural productivity on existing farmland, both to meet growing demand for food and to offset the climate-change yield losses. Adopting LEI farming methods is crucial to achieving future food-security and climate-change goals. Scale does not dictate the approach to be adopted. Indeed, LEI agriculture approaches may lead to successful results when applied in both large-scale and small-scale farming.
In terms of prospects for developing countries’ agriculture, supporting small-scale farmers would achieve the greatest impact in terms of income creation and food security, in particular when associated with LEI agriculture methods. Section 3.1 will therefore discuss strategies to reduce the vulnerability of subsistence (family) farmers, while Section 3.2 will provide a review of ways and lessons learned to help small investor farmers to overcome limitations of capacity, finance, and infrastructure that hamper their growth.
In countries where labour supply constrains smallholder expansion, large-scale industrial farming can be a successful option to promote food security (through a reduction in prices, thanks to high productivity) and reduce poverty (through the creation of employment). In addition, when LEI methods are applied, they minimise harm to the environment. However, evidence so far proves that unless strong regulation is in place to secure property rights, discipline land acquisition, and ensure transparent and participatory negotiations, adverse social and environmental effects outweigh the benefits. Section 3.3 will discuss how to ensure that large-scale farming benefits poor people.
The need for investment in technology, infrastructure, market access, and institutions suggests that private investment could contribute in many ways which do not involve large-scale land acquisitions. On the contrary, a variety of institutional arrangements can be used to combine the assets of investors (capital, technology, markets) with those of local communities and small farmers (land, labour, and local knowledge). Greater opportunities and important economies of scale for private domestic or foreign investors can be achieved in terms of output processing, packaging, and marketing, rather than in production. These measures include a wide range of more collaborative arrangements between large-scale investors and local small-scale farmers and communities. As discussed in Section 3.4, private investment through inclusive out-grower schemes can promote smallholder diversification into high-value crops and export-market production, and can support productivity gains. There are pros and cons in all these different approaches, and the conditions for success or failure are very context-specific and contingent on a country’s institutions, tenure, policy, culture, and demographic considerations.
Whatever mix of the four-pronged approach is adopted, major commitment and investment by governments, development agencies, and private-sector actors, reversing the trend of the past 20 years, will be essential to achieving sustained agricultural growth and to making a major dent on poverty and hunger