Harnessing structural transformation for human development: the importance of rural development David Woodward ALDC, UNCTAD 17 March 2015
100 Poverty Headcount Ratio, 1990 and 2011 (%) Poverty Headcount Ratio, 2011 (%) 75 50 25 ODCs (Other) ODCs (SSA) African LDCs + Haiti Other LDCs Island LDCs 0 0 25 50 75 100 Poverty Headcount Ratio, 1990 (%)
100 Poverty Headcount Ratio, 1990 and 2011 (%) Poverty Headcount Ratio, 2011 (%) 75 50 25 ODCs (Other) ODCs (SSA) African LDCs + Haiti Other LDCs Island LDCs 0 0 25 50 75 100 Poverty Headcount Ratio, 1990 (%)
Poverty Headcount Ratio, 1990 and 2011 (%) 100 Poverty Headcount Ratio, 2011 (%) 75 50 25 POVERTY HALVED BY 2015 ODCs (Other) ODCs (SSA) African LDCs + Haiti Other LDCs Series3 Island LDCs 0 0 25 50 75 100 Poverty Headcount Ratio, 1990 (%)
100 Poverty Headcount Ratio, 1990 and 2011 (%) Poverty Headcount Ratio, 2011 (%) 75 50 25 POVERTY INCREASED SINCE 1990 POVERTY HALVED BY 2015 ODCs (Other) ODCs (SSA) African LDCs + Haiti Other LDCs Series2 Series3 Island LDCs 0 0 25 50 75 100 Poverty Headcount Ratio, 1990 (%)
4 Projected Rural Population % (2030) and Rural Population Growth % pa (2013-30) Rural Population Growth, 2013-30 (% pa) 2 1-1 LDCs Asia LDCs Island LDCs SSA+H ODCs -3 0 25 50 75 100 Rural Population, 2030 (% of total)
4 Projected Rural Population % (2030) and Rural Population Growth % pa (2013-30) Rural Population Growth, 2013-30 (% pa) 2 1-1 LDCs Asia LDCs Island LDCs SSA+H ODCs -3 0 25 50 75 100 Rural Population, 2030 (% of total)
90 Projected Increase in Rural Working-Age Population in LDCs, 2013-2030 (%) 67.5 45 Demographic Change Rural Population Increase 22.5 0-22.5-45 Niger Togo Burundi h Sudan mbique Uganda Mali Gambia omoros Sudan agascar Benin Guinea anuatu jibouti Yemen Rwanda e and P uritania Kiribati Nepal epublic gladesh Haiti
Rural-Urban Differences in Poverty, LDCs Poverty urbanheadcount rural Ratio (2008) (2009) (2008) (2005) (2011) (2002) (2007) (2010) (2008) (2008) (2011) (2009) (2011) (2010) (2009) (2011) (2012) (2010) -90-67.5-45 -22.5 0 22.5 45 67.5 90
Rural-Urban Differences in Poverty, LDCs Poverty urbanheadcount rural Ratio urban Poverty Gap rural (2008) (2009) (2008) (2005) (2011) (2002) (2007) (2010) (2008) (2008) (2011) Angola (2008) Burkina Faso (2009) Central African Republic (2008) Congo, Dem. Rep. (2005) Guinea (2012) Lesotho (2010) Madagascar (2010) Mali (2010) Mozambique (2009) Senegal (2011) South Sudan (2009) (2009) (2011) (2010) (2009) (2011) (2012) (2010) Tanzania (2012) Uganda (2009) Comoros (2004) Timor-Leste (2007) Bangladesh (2010) Lao PDR (2012) Yemen, Rep. (2005) -90-67.5-45 -22.5 0 22.5 45 67.5 90-40 -30-20 -10 0 10 20 30 40
Rural-Urban Infrastructure Gaps, LDCs Angola a Faso public. Rep. 2006= hiopia uinea Haiti iberia Malawi ritania Niger enegal (2011) Sudan Togo ambia iribati Islands Tuvalu nistan hutan ao PDR Nepal Population urban without Access ruralto Water -100-75 -50-25 0 25 50 75 100
Rural-Urban Infrastructure Gaps, LDCs Angola a Faso public. Rep. 2006= hiopia uinea Haiti iberia Malawi ritania Niger enegal (2011) Sudan Togo ambia iribati Islands Tuvalu nistan hutan ao PDR Nepal Population urban without Access ruralto Water Angola Burkina Faso Central African Republic Congo, Dem. Rep. Equatorial Guinea Ethiopia Guinea Haiti Liberia Malawi Mauritania Niger Senegal Somalia Sudan Togo Zambia Kiribati Solomon Islands Tuvalu Afghanistan Bhutan Lao PDR Nepal -100-75 -50-25 0 25 50 75 100 Population urban without Access ruralto Electricity -100-75 -50-25 0 25 50 75 100
So. The SDGs imply a stronger focus on LDCs and on rural areas within LDCs. This is where the needs are greatest, in terms of employment creation infrastructure investment and where the impact of efforts to achieve the SDGs will be greatest.
Poverty Eradication: What Would it Take? Need incomes for all above the poverty line But income transfers are logistically infeasible and financially sustainable, so Need employment for all, at incomes above the poverty line But only sustainable if matched by productivity, so Need employment for all with productivity above the poverty line ie structural transformation plus full employment
Structural Transformation of the Rural Economy Increasing labour productivity within sectors agriculture non-agricultural goods and services Shifting resources from lower- to higherproductivity sectors from lower to higher-value crops in agriculture from agriculture to non-farm production: rural economic diversification Not either/or: harness the synergies
AGRICULTURAL UPGRADING income agricultural productivity and diversification
AGRICULTURAL UPGRADING income demand for non-agricultural goods/services agricultural productivity and diversification Reduced employment supply of staples and highervalue foods
AGRICULTURAL UPGRADING income demand for non-agricultural goods/services Inflation? agricultural productivity and diversification Reduced employment Unemployment? supply of staples and highervalue foods Falling prices offset income gains?
AGRICULTURAL UPGRADING income demand for non-agricultural goods/services Inflation? agricultural productivity and diversification Reduced employment Unemployment? supply of staples and highervalue foods Falling prices offset income gains? Need resources for investment and input purchases
RURAL ECONOMIC DIVERSFICATION Development of non-agricultural production income
RURAL ECONOMIC DIVERSFICATION Falling prices offset income gains? supply of non-agricultural goods/services Wage pressure? employment Development of non-agricultural production Inflation? demand for staples and higher-value foods income
Need resources for investment and input purchases RURAL ECONOMIC DIVERSFICATION Falling prices offset income gains? supply of non-agricultural goods/services Wage pressure? employment Development of non-agricultural production Inflation? demand for staples and higher-value foods income
AGRICULTURAL UPGRADING RURAL ECONOMIC DIVERSFICATION income demand for non-agricultural goods/services supply of non-agricultural goods/services agricultural productivity and diversification Reduced employment employment Development of non-agricultural production supply of staples and highervalue foods demand for staples and higher-value foods income
AGRICULTURAL UPGRADING Resources for investment and input purchases RURAL ECONOMIC DIVERSFICATION income demand for non-agricultural goods/services supply of non-agricultural goods/services agricultural productivity and diversification Reduced employment employment Development of non-agricultural production supply of staples and highervalue foods demand for staples and higher-value foods income Resources for investment and input purchases
Agricultural extension, input supply! supply-side "kick-start" Enterprise support, microgrants! supply-side "kick-start"
SDGs: Infrastructure investment - labour-intensive construction and local procurement! demand-side "kick-start" Agricultural extension, input supply! supply-side "kick-start" Enterprise support, microgrants! supply-side "kick-start"
Conclusion Meeting the SDGs will require structural transformation of rural economies in LDCs This will be a major challenge: low productivity, under-employment, growing workforce, major infrastructure gaps. Success requires harnessing the synergies between agriculture and the non-farm sector to create a virtuous circle and harnessing the the Post-2015 Agenda to provide demand-side and supply-side "kick starts"