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In the
span of just 30 years,
Asia has achieved
unprecedented economic growth and poverty reduction. The
region’s strong economic trajectory continues today and
is on track to generate nearly half the world’s gross
domestic product by 2015.
Yet,
while millions across
Asia have moved
out of poverty during the past three decades, millions
more remain impoverished. By 2015, the region will be
home to half the world’s poor people, the vast majority
of whom will live in rural areas.
These
two faces of Asia—economic powerhouse and impoverished
region—reveal the dramatic transformation now under way.
With nearly 680 million poor people currently living in
rural areas, future growth strategies must focus on
rural development, namely, in agriculture and nonfarm
rural industries, which the poor rely upon for their
income and livelihoods. Otherwise, the poor will fail to
reap the benefits of future economic growth and remain
impoverished.
Strategies for future growth should draw on lessons from
the past. The last three decades show how accelerating
agriculture and rural development in Asia can
significantly enhance the livelihoods of the poor.
Between
the mid-1970s and 2004, poverty in the region fell from
more than 50 percent to 18 percent. Strong agricultural
growth, driven by higher crop yields and greater labor
productivity, was largely responsible for this progress.
In
India, states that reduced poverty the most also
experienced the highest agricultural growth; in China,
the largest poverty reductions occurred alongside the
greatest increases in agricultural incomes.
Elsewhere across Asia, countries that introduced
policies and investments in support of agriculture and
rural development have also cut poverty. In
Indonesia,
equitable distribution of land contributed to poverty
reduction, while in the lowland areas of Vietnam,
poverty rates declined with the development of rural
infrastructure that connected villages to local markets.
However,
the best policies for the future of the region cannot be
simply extrapolated from the past. Alleviating rural
poverty in Asia today requires new approaches that
tackle emerging challenges and tap into new
opportunities. These include enhancing poor farmers’
participation in a rapidly changing global food market
and burgeoning free-trade environment, as well as
addressing persistent poverty in lagging regions, the
growing threat of water scarcity and climate change, and
increased vulnerability to risks.
In
particular, future growth strategies must focus on rural
income-generating opportunities outside of agriculture,
such as trade, services, transportation, handicrafts and
small-scale manufacturing. Nonfarm activities are an
increasingly important source of income for the rural
poor in Asia and are likely to become even more
important in the years ahead.
Between
2000 and 2001, 52 percent of the rural poor in
Bangladesh derived their income from nonfarm activities.
In
China,
nonfarm income reached nearly 70 percent in 1999.
Even
before the explosive growth of the 1990s, the rural
nonfarm economy accounted for one-third or more of rural
employment, and its growth substantially reduced poverty
by creating income-generating opportunities that are
frequently higher than those in the farm sector. Better
access to credit, electricity and telecommunication
services are now needed to assist the rural poor in
creating and sustaining rural-based enterprises off the
farm.
Accelerating rural growth is one of the key ways to
reduce poverty in Asia. Policymakers and other
stakeholders must now find ways to strengthen incentives
and institutions and improve technology that places
propoor rural growth on the fast track.
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The International Food Policy Research Institute (IFPRI)
seeks sustainable solutions for ending hunger and
poverty. It is one of 15 centers supported by the
Consultative Group on International Agricultural
Research, an alliance of 64 governments, private
foundations, and international and regional
organizations. www.ifpri.org |
