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Rural Poverty

Rural Poverty in the Developing World

At the heart of every human experience is the desire to survive and prosper. To live without fear, hunger or suffering. To imagine how your life could be better and then have the means to change it. Yet, every day, 1.4 billion people – nearly one fifth of the world’s inhabitants – cannot fulfil their most basic needs, let alone attain their dreams or desires.

The largest segment of the world's poor are the women, children and men who live in rural environments. These are the subsistence farmers and herders, the fishers and migrant workers, the artisans and indigenous peoples whose daily struggles seldom capture world attention.

Empowering rural people is an essential first step to eradicating poverty. It respects the willingness and capability that each of us has to take charge of our own life and to seek out opportunities to make it better.

Fighting rural poverty has to take different dimensions into account, such as:

Land

Access to land and land tenure security are at the heart of all successful rural societies and agricultural economies. Having land, controlling it and using it are critical dimensions of rural livelihoods.

Framers harvest potatoes in Bangao, Buguias, Benguet, Philippines.

Framers harvest potatoes in Bangao, Buguias, Benguet, Philippines.

Land is not simply an economic resource. It is an important factor in the formation of social and cultural identity and in the organization of religious life. It is also an enormous political resource, defining power relations between and among individuals, families and communities under established systems of governance.

In rural societies, landless or near-landless people and people with insecure tenure rights often constitute the poorest and most vulnerable groups. Poorer and marginalized groups tend to have secondary rights that rarely extend beyond use rights. And what rights they have are often unprotected and weak, especially in the case of women.

Land issues have an impact on the everyday choices and prospects of poor rural people. For example, issues of land access and security of land tenure strongly influence decisions on the nature of crops grown, whether for subsistence or commercial purposes. Such issues also influence the extent to which farmers are prepared to invest (both financially and in terms of labour) in improvements in production, in sustainable natural resources management, and in the adoption of new technologies and promising innovations. They also have an impact on people’s access to financial services and on their capacity to interact and take advantage of markets. The structure and functioning of land tenure systems are important factors in determining how the benefits of agriculture-based activities are divided among various individuals and groups within households and communities.

Land tenure systems can therefore have a major impact on the outcomes of externally supported projects and programmes designed to improve the livelihoods of poor rural women and men. At the same time, externally supported projects could further threaten poor people’s access to land and tenure security. For example, the introduction of new technologies or irrigation schemes often increases land values. If all existing rights, including secondary rights, group rights and multiple user arrangements, are not adequately considered, the technologies or schemes can result in the loss of access to land by poor and vulnerable groups. Similarly, the opening up of new roads to facilitate market linkages can result in the influx of new, often better-resourced settlers and an increase in social conflicts.

Trade liberalisation and Market Access

Globalization and trade liberalization carry with them tremendous challenges for poor countries and poor people, especially rural poor people, within poor countries. They carry also opportunities.

Pascaline Bampoky

Pascaline Bampoky is a 30-year old mother of three living in Senegal. She had a hard start in life: “I am an orphan. I lost my parents at a tender age. I was brought up by my aunt.” She had a primary education but nothing more: “No one was there to pay for my secondary education.” Her aunt got her a job as a housemaid in Dakar: “It was the only thing I was good at. There was no alternative.” It was there she met her husband, who ran a small shop.

When his father died, they moved back to Bignona, Casamance, to look after her husband’s grandfather and they transferred the business there. Together the couple also work the grandfather’s rice fields. He raises the seedlings and ploughs the land; she plants the rice and gathers the harvest. They grow just enough to feed the family for three months. “We don’t have enough resources or land to produce more.” One year they tried millet in addition to the rice, another year cassava: “But it [produced] really very little, for our own consumption and not for sale.”

Although she deeply regrets her lack of education and training, Pascaline believes “women are naturally good managers” and she is pursuing other means of making a living. She raises chickens and pigs for sale, and uses the income for school fees and medical expenses. She has also started a small ice-cream business: “Well, after the harvests I am in my kitchen and my house as a wife and a mother. But I also have a small trade activity that I carry out from time to time. We have a refrigerator, so I make ice cream to sell.” She buys the fruits at market, makes the ice cream at home and sells it at schools and “sometimes at church”. Her husband gave her the start-up money.

Pascaline is a member of the local women’s association. During the rainy season they offer their labour, planting or harvesting rice. The fee for fellow members is lower than for those outside the association. The rate, she explains, “may sound cheap to you, but remember the basic objective of the association is solidarity.” The money raised is shared among the members, and often used to buy cloth, and also to create a fund to assist members in difficulty. Such assistance is provided as loans, which she says are always paid back: “It is a question of honour.”

Interacting with agricultural markets is an important aspect of the livelihood strategies of many rural households, rich and poor alike. Markets are where, as producers, they buy their agricultural inputs and sell their products; and where, as consumers, they use their income from the sale of crops, or from their non-agricultural activities, to buy their food requirements and consumption goods. Virtually all households in rural areas are, by preference, both producers and consumers, buyers and sellers; and many sell agricultural produce and buy their food at different times of year. However, rural households that, for one reason or another, are unable to interact with these markets are prevented from adopting these diverse livelihood strategies; and indeed, in many parts of the world, rural poor people often say that one reason they cannot improve their living standards is that they face difficulties in accessing markets.

For these reasons, improved market access is not an issue of consequence only to better-off producers, and it is not relevant only to cash crop, rather than food crop, production. It is of importance to all rural households, and assisting rural poor people in improving their access to markets must be a critical element of any strategy to enable them to enhance their food security and increase their incomes.

Desertification

When fragile land in arid regions is overexploited by the demands of an expanding population, it loses its productive capacity. The results are devastating. Land degradation affects more than 1 billion people and 40 per cent of the earth’s surface. In the severest cases the land becomes infertile and useless, precipitating famine and drought. Every year 12 million ha of land are lost to desertification, and the rate is increasing. Desertification is a major environmental problem that is advancing at an alarming pace.

The effects of desertification are potentially devastating and in the worst cases are irreversible. Desertification reduces the land’s resilience to natural variations in climate and disrupts the natural cycle of water and nutrients. It intensifies strong winds and wildfires. Other long-term detrimental effects such as dust storms and sedimentation of waters and streams are felt at great distances from where the problem originates.

The loss of agricultural land to land degradation is extremely costly, and not only in economic terms. Desertification leads to prolonged episodes of drought and famine in countries that are already impoverished and cannot sustain large agricultural losses. Rural poor people who depend on the land for survival are forced to migrate or starve.

But it is possible to combat desertification by using particular techniques, and much can be done to stop land degradation from reaching the point of irreversibility. Financial resources are required, as well as a commitment on the part of governments to act to save the land. With careful management marginal lands can continue to feed the populations that depend on them.

Water

Water is central to meeting all but foremost the first Millennium Development Goal (MDG) target of reducing by half the proportion of people living in extreme poverty and hunger by the year 2015. Global attention is mostly focused on the MDG regarding safe drinking water and sanitation. Given that approximately 70 per cent of the world’s mobilized water resources are used for agriculture, and that about half the world’s population will be suffering water scarcity by 2025, it is surprising that the international community has hitherto spent relatively little time or energy on these issues.

Poor rural people face an intricate web of deprivations. Improvements to lives and livelihoods will place water resources under increasing, and in some cases, unsustainable pressure. These twin challenges set the scene for the need to look at water in all of its contributions to development – in health, in food, in livelihoods, in energy and industry – through development that does not jeopardise the integrity of the environment, both in developing and developed countries.

Rural institutions

Water users’ groups, agricultural producer and rural workers associations, rural credit unions, women and youth associations and other self- help groups are all examples of institutions. They have been traditionally defined as organizational entities with procedures and regulatory frameworks. Institutions can be referred to as the ‘rules of the game’, that include: (a) mandate; constitutional and environmental factors; boundaries within which actors and organizations operate; (b) the relationships between actors and organizations within a number of fields of interaction; and (c) the motivations, incentives and rewards for actors and organizations to engage and participate in a given activity. Institutions are also the formal and informal constraints on political, economic and social interactions.

Given that the majority of the poor live in rural areas, the institutional context of rural institutions is pivotal to reducing poverty and fostering development. This is particularly true for countries where diverse institutions and organizations mediate the access of the poor to assets, technologies and markets. They also usually regulate customary practices and administrative processes that determine whether the poor benefit from such access or would be affected by it. Additionally, there is overall agreement on the fact that the chance the poor have to influence rules and to help control organizations depends on their power and informed participation.

For the rural poor, good institutions and organizational entities are twice as important, as isolation and weak performing institutions impact considerably on their well-being. Additionally, the rural poor suffer from extremely limited provision of public goods, which further acts against actions aimed at reducing their poverty.

Rural Finance

Portrait of a young farmer in a field in Kossoye, Ethiopia.

Portrait of a young farmer in a field in Kossoye, Ethiopia.

Good management of even the smallest assets can be crucial to very poor people, who live in precarious conditions, threatened by lack of income, shelter and food. To overcome poverty, they need to be able to borrow, save and invest, and to protect their families against risk. But with little income or collateral, poor people are seldom able to obtain loans from banks and other formal financial institutions. And even when they do have income or collateral, the amounts they require are often too small to appeal to banks.

Microfinance is one way of fighting poverty in rural areas, where most of the world’s poorest people live. It puts credit, savings, insurance and other basic financial services within the reach of poor people. Through microfinance institutions such as credit unions and some non-governmental organizations, poor people can obtain small loans, receive remittances from relatives working abroad and safeguard their savings. Accessing small amounts of credit at reasonable interest rates gives people with the willingness and know-how an opportunity to set up a small business. Records show that poor people are a good risk, with higher repayment rates than conventional borrowers. In countries as diverse as Bangladesh, Benin and Dominica, repayment rates are as high as 97 per cent.

Livestock

Nearly one billion head of livestock are kept by more than 600 million small farmers and herders in rural areas around the world. Most of these livestock keepers – about 95 per cent – live in extreme poverty. Even though livestock keeping offers a promising opportunity to combat poverty in many developing countries, especially as the demand for animal products such as milk and meat continues to rise, most livestock policies and services tend to favour large-scale production. In order to take advantage of emerging market demands and reduce their poverty, small farmers and herders need access to basic services and technologies, such as veterinary care, good roads and grazing lands, as well as policies that take account of their needs.

Income from livestock and their many products – milk, eggs, meat, wool, leather, honey – can allow poor families to put food on the table, improve their nutrition, send their children to school and purchase medicine for themselves and their animals. Livestock also act as a kind of social glue. Loans and gifts of livestock connect people to other family members, as well as to communities and institutions. Livestock are used to resolve conflicts, pay debts and settle scores. A family’s place in society is often measured by the amount and kind of livestock it owns.

When women own livestock, their social status can be improved, empowering them to participate in decision-making. Livestock serve a practical function, too. They carry heavy loads, help plough fields and provide means of transportation. Their manure fertilizes the soil. Most livestock graze on straw, grass, kitchen scraps and other waste, and thus convert unusable materials into high-quality food for humans. Their meat adds protein to cereal-based diets and can improve the nutrition of children. The presence of livestock reduces the need for human labour in the fields.

The right kind of livestock services can make all the difference to poor livestock keepers struggling to run more efficient businesses and reduce their own poverty. These services include veterinary care, grazing lands, feed grain, reliable water sources, good roads, breeding technologies and access to financial services. When a national livestock project in Togo provided small farmers and herders in 300 rural communities with access to animal vaccines, for example, the health and productivity of the livestock improved and incomes increased.

Poor people themselves need to be involved in the development and selection of livestock services. Yet their needs are often neglected. Living far from big cities and often illiterate, rural poor people are seldom asked to take part in the development of policies or the structure of services. To be effective, livestock services need to address the reality that most rural poor people lack access to vital resources such as land, water, markets, credit, health services and education.

One way to ensure that poor people are given a voice in decision-making is by helping them form official producer organizations. A project in the Central African Republic transformed a group of 25,000 regional herders into a national service organization capable of playing a major role in livestock development. Cooperatives and self-help groups can strengthen the competitive position of poor livestock keepers and reduce poverty in entire communities. Such initiatives need the support of governments and development organizations. They can be key to improving livestock services and empowering the rural poor.

Indigenous people

Tovoke, a fisherman, fishes squid in Bema, Madagascar.

Tovoke, a fisherman, fishes squid in Bema, Madagascar.

There are about 350 million indigenous peoples in the world. Although they account for less than 5 per cent of the global population, they comprise about 15 per cent of all the poor people in the world.

The extent and persistence of poverty in many ways depends on whether poverty among indigenous peoples can be reduced by 2015. Poverty reduction among indigenous peoples is not simply a matter of service delivery. It is about equipping them with the capabilities they need to lead the kind of life they value, to be free from fear and to enhance their role as agents in transforming their lives.

Living far from centres of commerce and power, indigenous peoples may find it hard to influence the policies, laws and institutions that could improve their living conditions and shape their futures. Many of them do not have the legal right to live on the lands they depend on for survival or to use the resources they have managed on a sustainable basis for thousands of years. Resources are increasingly exploited by outsiders, with few benefits flowing to indigenous communities and with little regard for the natural environment.

In the past, paternalistic development schemes often attempted to assimilate indigenous peoples into mainstream cultures. Such efforts were not only unwelcome but were also unsuccessful. To overcome poverty, indigenous peoples need special assistance that is based on their own objectives and that addresses the barriers they face and helps them protect their livelihoods, heritage and cultural identity.

There are many ways of enabling indigenous peoples to overcome poverty. One of the most effective is to support their efforts to shape and direct their own destinies, and to seek their free, prior and informed consent. By strengthening organizations of indigenous peoples it is possible to increase their ability to negotiate successfully with others on their own behalf. More and more indigenous peoples are seeking international recognition and the right to participate in defining agreements on issues that affect them, such as global warming.

Gender

District of Cheto, Peru. Processing Center of Milky Products.

District of Cheto, Peru. Processing Center of Milky Products.

When women are economically and socially empowered, they can become a potent force for change. In rural areas of the developing world, women play a critical role in running households and make major contributions to agricultural production. But the inequalities that exist between women and men make it difficult for women to reach their full potential.

Women rarely have access to the resources that would make their work more productive and ease their heavy workload. Persistent gender inequalities are an obstacle to growth. Ultimately, it is not just women who are held back, but also their families, their communities and local economies. Rural women fulfil many roles, and have responsibilities and knowledge that differ from those of men. As farmers, they plant, weed and harvest food crops and tend livestock. As caretakers, they look after children and relatives, prepare meals and manage the home. Many women earn extra income by working as wage labourers, producing and selling vegetables, or engaging in small-scale trading and enterprises. Added to these multiple tasks, they spend long hours fetching water and collecting firewood. In developing countries in Africa, Asia and the Pacific, women typically work 12 or 13 more hours per week than men. In poor and marginal areas and areas affected by climate change, where men have been forced to migrate in search of work, women often have the sole responsibility for farming and raising the children. Despite their many responsibilities, women have significantly less access to the resources and services they need to increase their productivity, earn more income, and ease their burden of household and caretaking duties. They are held back by lack of education, by unequal property rights and limited control over resources. Labour-intensive and time-consuming activities further hinder women’s ability to improve their income-earning potential. In order for poor communities to prosper and grow, women’s needs and rights must be addressed.