Is urbanization a grand opportunity for rural economic growth in developing countries? Peter Richards Bureau for Food Security USAID

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1 Is urbanization a grand opportunity for rural economic growth in developing countries? Peter Richards Bureau for Food Security USAID 1

2 U.S. Government s Feed the Future Initiative Initiated in 2010 Launched in response to 2008 price spike in food and energy commodities. Designed to accelerate agriculture-sector growth and improve nutrition outcomes. Focus on Value Chains 2

3 Per Capita GDP (Current US$) in Lower Income Countries $700 $600 $500 $400 $300 $200 $100 $

4 % Living in Poverty in Lower Income Countries

5 MILLIONS Rural and Urban Population Growth Lower Income Countries & Sub-Saharan Africa Rural Urban Low-income countries Sub-Saharan Africa

6 Trends in Global Food Consumption 80% Percent Change in Consumption 70% 60% 50% 40% 30% 20% 10% 0% -10% Growth is primarily in High Value Perishables Most of Cereal Growth Tied to Feed Crops Cereals - Excluding Beer Vegetables Meat

7 Trends Vary By Country 7

8 Trends in Food Consumption in Feed the Future Countries Percent Change in Consumption Malawi Little or No Change GDP Cereals Poultry Vegetables Milk Fruits

9 Trends in Food Consumption in Feed the Future Countries 600 Percent Change in Consumption Ghana Strong Growth in Poultry GDP Cereals Poultry Vegetables Milk Fruits

10 Trends in Food Consumption in Feed the Future Countries Haiti Major Growth in Poultry Significant Increases in Dairy GDP Cereals Poultry Vegetables Milk Fruits

11 Trends in Food Consumption in Feed the Future Countries Dairy Consumption increases by 200% Percent Change in Consumption Ethiopia Vegetable Consumption Doubles GDP Cereals Poultry Vegetables Milk Fruits

12 Trends in Food Consumption in Feed the Future Countries 250 Percent Change in Consumption Mali Dairy Consumption increases by 150% GDP Cereals Poultry Vegetables Milk Fruits

13 Trends in Food Consumption in Feed the Future Countries Percent Change in Consumption Guatemala Significant Increases in Poultry and Vegetable Consumption GDP Cereals Poultry Vegetables Milk Fruits

14 Trends in Food Consumption in Feed the Future Countries Percent Change in Consumption Bangladesh Vegetable and Fruit Consumption Doubled! GDP Cereals Poultry Vegetables Milk Fruits

15 Next Steps for US Efforts on Food Security 15

16 Global Food Security Act (GFSA) July 2016 Global Food Security Act (GFSA) passes with bipartisan support. GFSA reaffirms US commitment to end global hunger, poverty and child malnutrition. October 2016 US Government releases the Global Food Security Strategy (GFSS). GFSS charts the course for achieving global food security and contributing to the Sustainable Development Goals (SDGs). Urbanization is highlighted as an emerging issue of strategic importance to global food security. 16

17 Urbanization as an Opportunity for Agricultural Led-Growth 1. Agriculture has new potential for driving economic growth.

18 Urbanization as an Opportunity for Agricultural Led-Growth 2. (a) Urban markets in developing countries are bigger than ever before, and growing fast.

19 Urbanization as an Opportunity for Agricultural Led-Growth 2. (b) New food demand is leading to new opportunities for food-system led economic growth.

20 Urbanization as an Opportunity for Agricultural Led-Growth 2.(c) Demand is growing particularly fast for higher-value perishables and processable foods.

21 Bangladesh- Onion Consumption 800% Percent Change in Consumption 700% 600% 500% 400% 300% 200% 100% Seven-fold increase In onion consumption! 0% -100%

22 Bangladesh- Onion Production 450% 400% Production Quadrupled 350% Percent Change in Production 300% 250% 200% 150% 100% 50% 0% -50% -100%

23 Bangladesh- Average Value (US$) Generated Per Hectare $5,000 $4,500 Onion $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Rice

24 Urbanization as an Opportunity for Agricultural Led-Growth 3.(a) Post-farm sections in the food system are increasingly critical.

25 Urbanization as an Opportunity for Agricultural Led-Growth 3.(b) Improving physical and legal infrastructure will be essential for inclusive food system-led growth.

26 Challenges going forward 26

27 Challenges going forward 1. No guarantee that future growth will include small scale producers.

28 Challenges going forward 2. Diversity in product quality, consistency, and traceability limits market access for small- farms.

29 Challenges going forward 3. Returns to scale are increasingly important in post farm elements in food production.

30 Thank you 30