REPORT: Rural Development Report 2016 Rural Development Report 2016-Fostering Inclusive Rural Transformation, September 2016
Rural development for growth and poverty reduction Recent progress against poverty has been steady across the globe (fi gure A). But in most regions, poverty rates in rural areas still stand well above those in urban areas. These trends refl ect the continuing challenges facing rural areas linked to the social, economic and political marginalization of rural people. Small family farms dominate rural landscapes across the developing world, accounting for up to 80 per cent of food produced in Asia and sub-Saharan Africa, while supporting livelihoods of up to 2.5 billion people (IFAD 2015). Yet these farmers face long-standing barriers to accessing technology, fi nance, knowledge and markets. At the same time, pressures on the rural natural resource base are growing, linked to population growth, unsustainable agricultural practices, urbanization, mining, land-use conversion and deforestation. Under these strains, the agricultural systems on which most rural dwellers depend face major challenges to meet the burgeoning demand for food, feed and fi bre (IFAD 2015). Rural households have widely differing capacities to generate income from increasingly important non-farm sources, implying sharp differences in their abilities to participate in the mainstream of rural economies (Haggblade et al. 2010).
Not surprisingly, when viewed as successful in overcoming these myriad challenges in rural areas, rural development is one of the most reliable and potent forces for poverty reduction and broad-based social and economic development. The evidence is strong and clear that sustained investment to enhance productivity in agriculture and the broader rural economy has a large impact on both growth and poverty reduction (Fan 2008; Fan et al. 1999, 2002). The impact pathways are both direct – through increased incomes and enhanced food and nutrition security – and indirect – through improved education, health care and other important services.
A distinguishing feature of this report is that it examines rural development in the context of the transformation of rural areas and the wider economy – rural transformation and structural transformation (fi gure B). By embedding rural development within rural transformation, and that within structural transformation, developments in urban and rural areas can be viewed together and be seen to be interconnected. Productivity growth in agriculture provides the food supply for urban growth and transformation, and releases labour to other sectors, such as manufacturing and services; simultaneously, rural transformation is shaped by the growth and diversifi cation of the demand for food and raw materials from the urban economy. From the point of view of rural areas, therefore, the report takes account of both supply and demand for goods, labour, capital and technology. At issue are the implications for rural development and rural transformation of deep and rapid demand-side changes in global and national factor markets and agrifood value chains. Pathways and levels of structural and rural transformation are shown to shape both opportunities and constraints to rural development and its inclusiveness.
The economic options and supportive policies for rural development that promote inclusive rural transformation vary considerably. Simplistic narratives are inadequate to explain observed patterns of development. Countries and regions within countries have many ways to transform themselves, and a given structural trend has many variations in how it translates into social development and inclusion. But paramount is the need to expand access for rural people to the range of new opportunities available, and to protect them from threats to such enhanced access.