UNconventional: A Point of View:
‘Good’ Globalization
By Joachim von Braun

Globalization of agriculture has long progressed at various frontiers. It is a mixed blessing. Carefully designed policies adapted to regional conditions are called for to foster the potential benefits for people and the ecology, and to prevent risks. These benefits, especially for the South, are large and should be tapped. Globalization means integration of inputs and outputs into global markets, global sharing of information and knowledge, and global rules governing such integration.

An agriculture that promotes high productivity of labour is a rather capital-intensive sector, i.e. investment in technology, skills and organizations. Globalization generally entails more mobile capital and finance, as well as increased volatility, reflected in exchange rate and interest rate fluctuations. As much of agricultural investment requires a long-run planning horizon, the transformation of agriculture is not generally made easier from that angle of globalization. On the other hand, productive agriculture is knowledge-intensive and could vastly benefit from a lowered cost of information and knowledge, both private and public, under globalization.

Traditionally, agriculture is local as much of it is bound to the cultivated land, farmed by people in communities that attempt to make the best of the local land and water resources under prevailing climate and technological conditions. While land, water and, to a large extent, people are not internationally mobile, some inputs (seed, fertilizer, feeds), outputs and knowledge related to agriculture are very mobile, even in a global sense. At the same time, globalization is also feasible and increasingly happening on the consumption side of agriculture as tastes, especially of urban consumers, become more uniform. This gives impetus to the globalization of food processing industries. In this sense, globalization of agriculture - on the output and input side of production, at the processing and consumption end of the food system, and in research and knowledge systems - is a fact and for several decades has been ever-deepening. Global players in the agro-industry have become more important and more widely distributed, not just in North America and Europe.

How are these globalization trends impacting on food security and the livelihoods of people? Are these tendencies making the world a less safe place for consumers and farmers?

FAO Photo

The answer is no. Food security for people has generally improved over the decades. Hunger continues to be on the decline, but not to the extent that anyone can be satisfied from a global perspective, and even less so in specific regions and countries where the food and health sectors have been underrated by policy. The main reason for being extremely disappointed with the progress in food security is that such progress has at best followed past patterns and trends, but does not at all correspond to the tremendous opportunities offered by the new global wealth and technology. The information and communications technology revolution has so far bypassed the food-insecure poor, and the biotechnology revolution has not happened for smallholder agriculture and remains in disarray in the North. While globalization has successfully included a significant part of the rural and urban food-insecure in parts of Asia and Latin America, this is not the case for most of Africa. Thus today food insecurity predominates in those regions, which have least and latest been touched by the comprehensive bundle for “good” globalization of agriculture mentioned above.

As agriculture is a knowledge-intensive sector, the facilitation of access to knowledge through globalization is a promising opportunity. It must be stressed that agriculture is not just an economic sector like many others, but due to historical conditions and the community and regional evolution of farming and livestock production, traditional agriculture is a valuable knowledge system and a cultural system in itself. Its opening-up to the global economy certainly has far-reaching implications for the cultural transformation of communities. Will this enforce the end of the tremendously rich diversity of global rural culture and its knowledge and wisdom? While there are dangers, this should not mean that this must be the outcome.

Globalization enforces increased competition between locations of production. This is the case for agriculture, as for all other sectors. The consequence is pressure for new and efficient institutional arrangements at the local level to build infrastructure, credit and taxation systems, and market channels, etc. Through that mechanism, globalization fosters decentralization in three ways: political, administrative and fiscal. That, in return, facilitates local empowerment, including for the local management of public goods, as well as education and culture.

This bright scenario of empowered, diverse but efficient and still culturally rich rural communities will not arise automatically without broad political support. Currently, we rather see a growing dualism in world agriculture where one part, not only in industrialized countries, is increasingly globalized, and the other remains marginalized and subsistence-oriented. This can occur side by side, as is the case with about 60 million subsistence gardening-and-farming units in Central and Eastern Europe, or the 400 million subsistence-oriented farms in the developing countries. Their integration into markets and knowledge systems is one of the true challenges of “good” globalization. Access to technology, innovative institutional arrangements for cooperation and market access are central constraints to be addressed by public policies.

But not only existing knowledge is needed. The complexities of agro-ecologies worldwide require a big push for applied new agricultural research linked well to these farming communities. The Consultative Group on International Agricultural Research is repositioning itself to address that challenge and focussing on poor consumer food needs. The result of such action at the knowledge frontier will not be large farms, but a diversity of more specialized and often part-time farms in communities which, in the context of increased productivity of farming, will raise their general labour productivity and incomes, and create other local jobs in non-farm production and services. Rural education is critical for this process to translate into sustainable development.

National government attention remains central for household food security under globalization. But world agriculture needs some global governance too. This is at least required for rules of trade and for food safety. Rural communities can be prime winners of globalization, but not all and not everywhere when agricultural trade is further deregulated. Agriculture is mainly protected from international competition by trade regulations and partly by standards, but not only in the rich countries of the North. A number of developing countries also shield farmers from global competition, and not just from global dumping. A gradual but continuous approach toward opening up world agricultural markets is needed in the context of the World Trade Organization. Food safety and information services require a strong FAO (Food and Agriculture Organization of the United Nations), serving as the global “Ministry of Agriculture”. A world of six billion now and probably nine billion in the next generation cannot afford any waste of scarce land and water resources, and must not be exposed to food risks.

Joachim von Braun is Director of the Center for Development Research (ZEF-Bonn), University of Bonn, Germany, and President of the International Association of Agricultural Economists.