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PART I: TOWARDS A STRATEGY FOR SUSTAINABLE AGRICULTURAL DEVELOPMENT: THE TRANSITIONAL PROCESS


"Planning is the exercise of intelligence to deal with facts and situations as they are and find a way to solve problems".

Jawaharlal Nehru

II. THE TRANSITIONAL PROCESS: A METHODOLOGICAL APPROACH

For the formulation of a strategy for the transitional process, the following step-by-step approach is proposed:

First, carrying out a comprehensive "needs assessment analysis" of the agricultural sector. The analysis would particularly focus on the damages to the physical and human infrastructures of the key sub-sectors within the agricultural sector. The needs assessment will provide quantitative analysis of the existing natural resource base by sub-sector; the rehabilitation needs; the absorptive capacity; and the required interventions in as detailed, quantitative and sequential process as feasible. In close collaboration with the FAO Nutrition Division (ESN), the Rural Development Division (SDA), the World Food Programme (WFP) and other concerned sister agencies, TCES will quantify relevant indicators which can identify at-risk population groups and households as well as the vulnerables within such households with physiologically more demanding conditions as an integral component of the needs assessment exercise.

Second, conducting a specific needs assessment exercise for each of the key sub-sectors within the food and agricultural sector. In particular emphasis would be placed on the following key sub-sectors: irrigation structures, crops, livestock, forestry, fishery, and food processing. The assessment would focus on such activities as reviewing (and as far as possible quantifying) the damages to the sector; infrastructures and analysing the current state of food and agriculture as well as food security in the country.

Third, developing a programme approach for the transition from short, to medium to longer-term actions for major sub-sectors as well as by geographical locations, i.e., by regions. At this analytical step a clear distinction and careful specification of the short, medium and longer-terms activities would be carried out.

For instance, under the short-term action programmes, FAO is actively participating in a UN Humanitarian Appeal to assist the Iraqi people following the current events in the country (see Chapter V below). Under the Appeal, FAO will assist in the identification and careful specification of activities aimed at the rehabilitation, on an emergency basis, of the key sub-sectors within the food and agriculture sector. These activities could include the provision of key inputs, such as seeds, fertilisers, pesticides, certain farm equipment, etc. that would be essential for resuming the production activities by farmers. The short-term programme should ensure not only the timely availability of such inputs but also the access of farmers to these inputs. To this end, FAO is also formulating a contingency plan for meeting the emerging needs in the short-term, (see also Chapter V).

Under the medium to longer-term action programmes, activities aimed at the transition from relief to development would be identified and introduced. These activities could include such actions as revisiting the key agricultural policy issues with the view to reformulating appropriate policies that should lead to sustainable agricultural development in the country. Such policies could include, inter alia: a) creation of conducive agricultural market and price environment to provide producer incentives in order to increase food and agricultural production; this process would imply revisiting the on-going food subsidies schemes and reconsidering the current provision of imported grains under the "food basket"; b) expanding and strengthening the agricultural credit sector of the economy; c) reviewing and rationalising the land tenure system taking into account the spatial dimension of the analysis; and d) creating criteria for regional decentralisation and balanced regional investment programmes.

Fourth, the programme approach mentioned above would also aim at addressing such targets as humanitarian needs of vulnerable groups engaged in agriculture, livestock and related activities; sustaining food production and income generating activities of farmers; and supporting co-ordinated interventions of organisations involved in agriculture and food security activities.

Fifth, establishing a longer-term vision that provides the approach for the transition process for the food and agricultural sector. To this end, it is proposed that the basic philosophy and approach of FAO Special Programme for Food Security (SPFS) would be imbedded in the vision. In addition, key elements from sustainable livelihoods approach could be also incorporated in the vision (as will be shown in the sections to follow).

Sixth, in line with the conceived vision, identifying priorities for medium to longer-term recovery and elaborating key performance requirements/indicators of the agriculture strategy to be developed with a view to meeting the set priorities.

Seventh, establishing a mechanism for co-ordinated actions on relief, rehabilitation and reconstruction relying on local human resources as well as national and regional institutional capabilities.

Eighth, on the basis of the above, formulating an operation strategy for the transition (road map) process to be utilized as the basis for the country's planning for sustainable agricultural development. The envisaged strategy would focus on attaching highest priority to such aspects as supporting the national, regional and local resource base; national institution building; enhanced governance including the adoption of a decentralised approach; and achieving a national ownership of the entire transitional process towards sustainable agricultural and rural development in the country.

III. THE NATURAL RESOURCE BASE

Land resources

The total land area of Iraq is 425,052 square kilometres (43.8 million hectares) of which 2.3% is covered by water (see Table 3, Annex I). A total of about 12 million hectares of the total surface area is considered suitable for cultivation. Of this area, about 4.5 million hectares are classified as highly suitable, 5 million hectares as moderately suitable and 2.5 million hectares are suitable for cultivation.

The land holding system in Iraq is a mixture of owner operator, lease holder and share cropper. The size of land holding depends upon the type of land. According to the agricultural reform regulations of 1990, the maximum holding size is 75 ha in rain-fed area. Lease holding size varies from 7.5 to 17.5 ha depending on the availability of agricultural reform land and density of population.

Land ownership

The farming system is a mix of free-hold and agricultural reform land (lease-hold), both governed by the Iraqi Agricultural Reform Regulation of 1990. The Regulation limited the holding size to a maximum of 75 hectares in the rain-fed agricultural areas. The lease-hold size varies from 7.5 to 17.5 hectares, depending on the availability of the agricultural reform land and the density of the population in the particular village. Share-cropping operations in the plains area can reach several thousand hectares.

Climate

Iraq enjoys continental and sub-tropical climate characterised by cool and cold winter, and hot to extremely hot and dry summer. The rainy season extends from October to March and the rainfall pattern is generally erratic. The mountain region, which lies in the northern part of Iraq enjoys Mediterranean climate dominated by cool winter and mild summer with annual rainfall ranging between 400 to 1000 millimetres. Steppe climate dominates Terrain plains where annual precipitation range from 200 to 400 millimetres. The rest of Iraq is covered by desert climate characterised by extreme variation between day and night temperatures and low annual precipitation ranging from 50 to 200 millimetres; (see Table 27-30, Annex VI).

Climatic and geographical diversity of Iraq are favourable conditions for growing a wide range of crops. Apples that generally require cold climate and date palm that require desert and hot climate are both grown very successfully in Iraq. Almost all kinds of field and vegetable crops are successfully grown there. northern part of Iraq is considered the origin of wheat crop and the tradition of growing the crop has been going on since thousands of years. Generally winter crops are grown during the period from October to June and summer crops are grown from March to September.

Agriculture production in Iraq is generally mechanised even on most of the small farms. Most inputs have been highly subsidised. In 1990, there were over 40,000 tractors and 5,000 combine harvesters in the country (see below.) Important agricultural inputs including compound fertilisers, urea and wheat seeds were adequately produced, meeting almost all the total need of the country. However, during the sanction period, the production capacity of the infrastructure has been reduced to less than 20% of its original potential.

Water resources

Iraq is blessed with the Tigris and Euphrates rivers. These rivers supply the major share of irrigation water for agriculture production in the country. Annual water source of the two rivers and their tributaries are estimated at 44 billion cubic meters for poor years and 77 billion cubic meters for good years. Ground water resource became an important element for agriculture production when Iraq faced two successive severe droughts during 1998/1999 and 1999/2000 seasons.

About 8 million hectares of the total area of land are irrigable and the remaining 4 million hectares are rain-fed. In 1997, the total irrigated area was estimated at 3.4 million hectares of which 87.5% obtained water from irrigation projects, 9.2% from rivers using irrigation pumps, 3.1% from artesian wells and 1.2% from the spring sources.

Agro-ecological zones

Generally speaking, four agro-ecological zones can be distinguished in Iraq. First, arid and semi-arid zones with Mediterranean climate. In these areas, a winter growing season of about 9 months, over 400 mm of annual winter rainfall and mild/warm summers prevail. This zone covers mostly the northern Governorates of Iraq. The major crops grown in this zone include wheat, barley, rice and chickpea. Other field crops are also produced in smaller quantities. There is some irrigation, mainly from springs, streams and bores.

Second, steppes with winter rainfall of between 200 to 400 mm annually. Extremely hot in summer and cold in winter. This zone is located between the Mediterranean zone and the Desert zone. This zone includes the areas of the feed barley growing, limited wheat production and limited irrigation.

Third, desert zone with extreme summer temperatures (often more than 450C) and less than 200 mm of rainfall annually. This zone extends from just north of Baghdad to the Saudi Arabian and Jordanian borders. This is rarely populated and cultivated with few crops in some irrigated spots.

Fourth, the irrigated area that extends between the Tigris and Euphrates rivers from north of Baghdad to Basra. It comprises more than 40% of the arable land area in Iraq. Serious hazards for this area are poor drainage and salinity. The majority of the country's vegetables, sunflower and rice are produced in this zone.

IV. AGRICULTURAL INCOME AND SOCIO-ECONOMIC CONDITIONS: AN OVERVIEW

Population and agricultural labour force

According to FAOSTAT, the population of Iraq was 23.584 million in 2001 (see Table 1, Annex I). Meanwhile, the national census (1997) revealed that female population exceeded the male population by 0.5%. The urban population was about 15 million (68% of total) compared with the rural population of 7 million (32%).

According to GOI estimation of the population for food distribution purposes under phase Xl, the total population in 2002 was given as 26.3 million, of which 3.68 million in the three northern Governorates (these figures seem to be overestimates).

The total labour force of Iraq was estimated at 22% of the total population. The size of the agricultural labour force in 1975 was estimated at 31%, while in 1990 it decreased to about 20%. The decrease can be attributed to the introduction of agricultural mechanisation, development of education and health services in the urban areas and increased job opportunities encouraging rural-urban migration. The available percentages of agricultural labour force are reported as follows:

Unemployment is widespread in Iraq and many of the employed themselves are keen on doing additional jobs to supplement their income. Iraq is also constrained by significant brain drain, while at the same time professionals are accepting less skilled jobs. However, with the increased inflow of Oil-for-Food inputs, the situation appears to have improved. Private businesses have been reactivated and in turn generating more employment opportunities.

With the exception of the public service and the trade sector, agriculture is the main provider of employment opportunities in Iraq. The percentage breakdown of the urban and rural populations can not be accurately utilised to estimate the labour force in agriculture as those who possess land mostly live in the urban areas and commute between the two locations. A common practice is to spend the summer months on the farm and return to the urban dwellings during the winter seasons.

Agricultural income

The national income in Iraq in 1996 was estimated at about 2 278 205 million Iraqi Dinars (ID). It increased in the following years until it reached ID 6 543 369 million in the year 2000, realising an annual rate of growth of 30.2%. Per capita income was ID 107 849 in 1996 and fluctuated, through the following years until it reached ID 277 531 in 2000 at an annual rate of growth of 26.7% during that period.

Gross domestic product according to economic activities was 2 620 966 million ID in 1996, and started to increase in the following years until it reached ID 7 523 807 million in 2000, thus realising an annual rate of growth of 26.7%.

Commodity activities of the gross domestic product in the year 2000 constituted 37.4% and the public sector was 11.6% of the gross domestic product for these activities. Distribution activities formed 49.4% of the gross domestic product for the year 2000 and the public sector 212.7% of the domestic product. Services composed 13.2% of the gross domestic product for the same year, of which the public sector was 25.4%.

Gross fixed capital formation was 46 685 million ID in the year 1994, and increased until it reached 53,922 million ID in the year 2000 at an annual growth rate of 50.4% during the period 1994 to 1999. The public sector made up 69.6% of the gross fixed capital formation in the year 2000.

The purchasing power of the ID was greatly reduced, with the precipitous depreciation in its value. Its exchange rate dropped from an equivalent of 0.32 ID to one dollar in 1990, to 3 000 ID to one dollar by the end of 1995. After the resumption of talks in January 1996 to put into effect the Oil-for-Food programme, the value of the US dollar dropped to about 500 ID for some time. In May 2002, the exchange rate stood at about 1 930 Dinars to one dollar.

The economic reverses that have taken place in Iraq since 1998 naturally resulted in degrading the living standard of the people. The Human Poverty Index occasionally published in the Human Development Report commissioned by UNDP once again drew world attention to the economic shift from relative affluence to massive poverty in Iraq. Inability to provide sufficient food for the family has been identified as a major factor for malnutrition. Crowded homes with poor sanitation have caused severe health hazards. Lack of adequately paid and secure jobs has significantly contributed to poverty.

Inadequate levels of schooling have been perceived as the main cause of low wages and unemployment. To confront the aggravating living conditions, most Iraqis have developed various coping mechanisms for their meagre survival. For more than 11 years, it has become a common practice of ordinary people to offer their valuable possessions for sale, in order to be able to buy their basic needs.

Food supply, nutritional intake and health

Agricultural production played an essential role in enhancing food security in the country before the introduction for the Oil-for-Food Programme. This was brought about by the absence of a food rationing system and the limited international food aid. The effective and rational functioning of the market forces resulted in an increase in the demand for food, higher incomes for farmers and horizontal expansion in cultivation of most field crops.

Currently, however, the agricultural sector is far from being able to provide sufficient food for the country's population. Food supply in general and for the food basket in particular heavily depends on imports under the Oil-for-Food Programme. It should, however, be stressed that the effective food distribution and food subsidy systems had prevented famine. The food basket has improved significantly since its introduction in 1991. Most households are dependent on the food basket since food items in the market are not affordable.

Two consecutive years of severe drought and inadequate availability of essential agricultural inputs have severely affected the Iraqi agriculture[1]. Reflecting a substantial reduction in plantings and yields, cereal production in 2000 fell to 794 000 tons, some 47 percent below the 1999 poor harvest and 64 percent lower than the previous five years average. Drought conditions also drastically reduced the water resources in rivers, dams, lakes and canals, some of which have virtually dried up. As a result, prospects were unfavourable for the upcoming irrigated summer crops, vegetables and fruits. Livestock numbers have also been affected but the poultry sector has been performing well having benefited from substantial Government interventions with funds generated from the Oil-for-Food Programme.

Cereal imports since 1997/98 under the Oil-for-Food Programme has led to significant improvements in the food supply situation. In 1995/96 per caput cereal consumption was down 63 percent from the 1984/85 to 1988/89 average. In 2000/01 it was about 90 percent of that level. However this is 4 percent less than 1997/98. Furthermore, problems of delays in the flow of food imports continue to be reported since the 1997 Mission, leading to repeated cases of low levels of MOU commodity stocks. Unless there is timely delivery of food imports under MOU contracts, shortfalls are likely to result in an increase in the frequency of not being able to meet food basket targets. Similarly, unless agricultural inputs, such as appropriate seeds, are delivered in time for the next season, a production recovery will not be achieved.

The effective nation-wide rationing system set up by the Government of Iraq in 1991 prevented famine. However, with the decline in the energy content of the GOI ration and the reduction in food available outside the rationing system, malnutrition and mortality of young children dramatically increased. The high levels of malnutrition documented by the 1995 mission were an important catalyst for reaching of an agreement on the implementation of the Oil-for-Food Programme. The subsequent increased humanitarian supplies provided under the Programme since 1997 and the high level of UN activity in the autonomous north arrested further nutrition decline.

Despite significant increases in the food ration since the Oil-for-Food Programme, child malnutrition rates in the Centre/South of the country do not appear to have improved significantly and nutritional problems remain serious and widespread. Wasting in under live-year-olds is unacceptably high at around 10%. The indication of high levels of malnutrition supports UN findings that infant and child mortality have more than doubled since the end of the 1980s. Classical recognisable signs of severe malnutrition such as marasmus and kwashiorkor continue to be observed in hospitals paediatric wards. The nutritional status of school children aged 5 to 8 years based primarily on stunting and those aged 9 to 15 years based on low BMI is a cause for concern especially for those from rural areas and poor households. In addition a number of micronutrient deficiencies are common and iron deficiency anaemia is high.

The existing food rations do not provide a nutritionally adequate and varied diet. Although since their effective implementation in they have halted further deterioration in the nutritional situation, they have not by themselves been able to reverse this trend. In spite of the fact that the ration is reasonably adequate in calories and total protein, it is lacking in vegetables, fruit, and animal products and is, therefore, deficient in micronutrients. With only one quarter of the planned ration of pulses distributed due to gaps in the submission of applications for procurement, the protein quality of the diet has also been poor.

The monthly food basket lasts up to three weeks depending on the type of ration. This deficit has to be made up by food purchases, further straining resources. Many households cannot afford to supplement their diet with an adequate variety of non-ration foods and intakes of micronutrients such as iron and Vitamin A remain far below requirements. Adequate amounts of items such as meat, milk and vegetables are too costly for many families to purchase to supplement their diet given the parallel decline in the economy and the effects of the current drought on the availability of crops and horticultural products. Consequently a significant portion of the population requires special attention, particularly the most vulnerable population groups whose coping strategies are rapidly being eroded. However, it would appear that despite shortfalls in the ration, segments of the population can supplement their diet with market purchases, albeit at considerable cost. This is confirmed by the high prevalence of overweight in adults.

In contrast, the implementation of the Oil-for-Food Programme in the northern Governorates has been accompanied by significant improvements in the nutritional situation. In children under five, wasting has almost been eliminated and there have been significant declines in the prevalence of stunting and underweight. Infant and child mortality rates have also fallen. Amongst the reasons for the north-centre/south differences are that the region is more self- sufficient in food, far greater assistance per capita has been received than the remainder of the country, and the north has benefited from the greater flexibility the use of cash gives agencies for the more effective operation and management of programmes.

The FAO mission recognised that malnutrition has been due to more than a lack of food. Other factors include poor sanitation, inadequate quantities of water, unsafe drinking water, overcrowding, repeated infections which in infants is often associated with the decline in breast-feeding and an increase in bottle-feeding, a lack of general nutrition and health education and poverty. These factors have had more of a negative impact in the centre/south than in the north with the beneficial effects of increased family rations being offset by the combination of these adverse conditions. These factors have been further worsened by the current dramatic events in the country.

Recommendations were provided by the FAO mission for improving the food, health and nutrition situation in Iraq. These included accelerating the process of approval of Oil-for-Food contracts and ensuring the timely delivery of humanitarian imports including food, medicines and inputs for the rehabilitation of agriculture, particularly seeds and materials for water conservation, control and irrigation management. With poor water and sanitation a major cause of malnutrition and excessive morbidity and mortality, the mission considers the maintenance and rehabilitation of the water and sanitation system a priority for meeting basic needs.

Improving dietary intakes was another top priority. Recommendations included diversifying the food rations with protein and micronutrient rich foods such as pulses, vegetables, fruit, and animal products as well as providing additional complementary food for young children and fortifying wheat flour with iron and vegetable oil with Vitamin A. Local production of foods for including in the ration as well as for use in special feeding programmes were also proposed. Exclusive breastfeeding should be encouraged and therefore infant formula limited to children 6 months and over unless prescribed by a doctor. Supplementary and therapeutic feeding programmes which target the most vulnerable need strengthening and both GOI and donors are encouraged to provide increased support. The use of cash in centre/south Iraq to improve programme effectiveness was recommended similar to that currently enjoyed in the north. Support was also urged for the rehabilitation of the food industry and for improving food safety. Other recommendations included support for nutrition and health services, in particular the rehabilitation of health services infrastructure, better information for monitoring the food, nutrition and health situation, and promoting appropriate diets, feeding practices and healthy lifestyles.

The oil-for-food programme: a bird's eye view

Concerned at the deteriorating food situation in Iraq, the United Nations Security Council adopted Resolution 986, the "Oil-for-Food" Programme. The Programme permits Iraq to export limited quantities (percentages) of its oil to finance imports of food and other essential humanitarian needs. This Resolution reserved 13% of oil revenues for the three northern Governorates to procure essential humanitarian supplies to be distributed on an equitable basis to all segments of the Iraqi population. The Memorandum of Understanding (MOU), laying down the terms for implementing Oil-for-Food Programme, was signed on 20 May 1996 by the Government of Iraq (GOI) and the United Nations (UN). FAO's responsibility is to, on behalf of the GOI, identify needs, prepare six-monthly Distribution Plans (DPs), implement the programme of humanitarian assistance and agricultural rehabilitation, and to act in an advisory capacity to the Local Authorities (LAs). The list of goods to be procured under each DP has to be sanctioned by the UN 661 Commission while the Technical Divisions of FAO are responsible for technically approving the DPs.

As about 40% of the population of Iraq is involved in farming, almost 12% of the value of the Oil-for-Food's supplies was allocated for the agriculture sector covered under both the Ministries of Agriculture and Irrigation.

The programme's ability to respond to sector needs in the centre and south was limited mainly due to its emphasis on short-term solutions. In these regions substantial resources were directed towards food import rather than the need to enhance local productivity. The sector has, thus, suffered from a marked deterioration of soils in rain fed areas and an increase in salinity and water logging in irrigated areas. This was largely due to insufficient quantities of essential basic inputs.

Meanwhile, it has been possible through the Oil-for-Food Programme to partially address the basic input shortages. The distribution of the various agricultural inputs has managed to enhance productivity and increase cultivated area at the beneficiary level. The overall trend of the decreasing crop yield remained mainly as a result of the incomplete nature of the Programme, where many other essential inputs were not included. The situation in the animal health sector improved as a result of the supply of inputs under the programme. However, the requirements for surveillance and control of infectious diseases and zones had not been effectively addressed due to lack of Rinds that would allow for the rehabilitation of the infrastructure.

In the three northern Governorates, the Programme's inputs have improved food availability through the enhancement of crop productivity in both rain fed and irrigated agriculture. It further improved the preparation and harvesting operations. The nutritional status of the people has improved especially that of children, through the availability and affordability of animal products. Forest nurseries with production capacity of 3.2 million seedlings have been established and rehabilitation of the high agricultural institutions and agro-industries are well underway.

Among its main achievements, The Programme has enabled the establishment of a media unit to cover its agricultural activities and to present educational extension programmes in the local media; the running of training programmes and; the physical involvement of the local authority's technical staff in the implementation of the Programme. This has resulted in marked improvements in the technical capabilities and skills of the Ministry of Agriculture staff and increased awareness and understanding of the farmers.

The availability of the Locally Generated Funds (LGF) from the nominal sale of some inputs has also been instrumental in ensuring the efficient and equitable distribution of the Programme's inputs to all farmers including those in remote areas.

The positive impact registered within the Oil-for-Food Programme in the three northern Governorates runs parallel with the negative impact faced by the wheat growers who are experiencing a downward trend in market prices, as a consequence of the almost free distribution of wheat flour included in the food basket. Wheat market prices fell on the first day of wheat flour distribution from US$ 147 per mt to US$ 75 per mt and US$ 53.7 per mt in 2002. This drastic reduction in wheat prices has led to the decrease in wheat cropped area of 12.8% since the 1996/1997 agricultural season. Instead of the programme's imported food supplementing local food production, it has negatively impacted the local production of wheat. To forestall these detrimental consequences, remedial measures need to be adopted at the policy level to provide flexibility concerning the sources of the main food items in the food basket. Procurement of domestically produced grains should, indeed, provide some price incentives and thus increase the farmers' productivity of these crops.

With the adoption of security council resolution 1483 (2003) the UN has been requested to terminate the ongoing operations and to transfer responsibility for the administration of any remaining activity under the OFF programme by 21 November 2003. The remaining funds in the Programme, along with certain revenues from the oil resources will be deposited in a new Development Fund for Iraq that has been established after the war. The functions of the Fund are, indeed, in line with the proposed Oil-for-Development Programme as discussed below.

Currently, issues that need attention include full rehabilitation and sustainable development of the agricultural sector in the country. The sector has suffered from inherited constraints, which have been aggravated by the consequences of the long-term sanctions and the wars. The sector has been compelled to shoulder the major responsibility for the country's food security while on the other hand the required shift in agricultural policy and planning is not possible under the restricted trade conditions and the prevailing economic situation.

Fortunately, with the current major events in the country, these constraints will certainly be eliminated. And following the end of the current war in the country, there would be a need for a comprehensive programme for the transition from relief, rehabilitation, and reconstruction to sustainable agricultural development to be designed and implemented in the country. This document provides an initial step along this process.

The development fund for Iraq: growth, equity and sustainability

Iraq is blessed by oil. Oil is an exhaustible natural resource. It is not a renewable productive resource base. Consequently, it is the responsibility of the current generation towards the new generations to utilize the returns of this resource as investment into a permanent and sustainable production base. That is, the returns from oil should be utilized in building up an industrial, manufacturing and/or agricultural base plus human resource base and quality of life. In this way the exhaustible natural resource (oil) changes its nature from a resource that would be exhausted at a certain point of time in the future into a sustainable production base.

Appreciating the above perception and noting the current political instability in the country (in particular, the absence of a democratically elected government at this stage), it is proposed that the returns from oil should be invested as noted above. To this end, it is suggested that in the immediate term the returns from oil should be accumulated under a scheme similar to the Oil-for-Food Programme that we might label an "Oil-for-Development" Programme. In other words, it is proposed that the objectives, nature and scope of the Oil-for-Food Programme should be substantially expanded to provide a developmental process. The proposed new Oil-for-Development Programme would be a more flexible and sustainable process that should help putting the Iraqi economy back on the development track. As a matter of fact, the newly established "Development Fund for Iraq" has, de facto, the same mandate. The above proposal has, therefore, been implemented.

Spending commitments, in the form of sectoral development programmes, could be developed by Sectoral Committees composed of Iraqi experts along with international experts from concerned technical bilateral and multilateral agencies, as appropriate. The multi-disciplinary work could be co-ordinated by an Iraqi/international Steering Committee that would provide an oversight for the entire process. Thus, for the agriculture sector, an Iraqi team of agricultural experts could work in close collaboration with a selected FAO team of experts in the formulation of a programme for sustainable agricultural development in the country.

The programme could be analysed according to temporal, spatial and sub-sectoral dimensions within a farming systems approach. In particular, sustainable agricultural development will be conceived in accordance with the following FAO definition: "Sustainable development is the management and conservation of the natural resource base and the orientation of technological and institutional change in such a manner as to ensure the attainment and continued satisfaction of human needs for present and future generations. Such sustainable development (in the agriculture, forestry and fisheries sectors) conserves land, water, plant and animal genetic resources, is environmentally non-degrading, technically appropriate, economically viable and socially acceptable."

This definition shows that conservation of natural resources figures prominently in the process of sustainable development. Taking into consideration other elements of the definition, sustainable development should be conceived as a comprehensive national development approach where the criteria of efficiency, equity and sustainability are carefully integrated within a coherent and operational framework. In this approach, efficiency implies the optimum use of natural resources; equity calls for the reduction in the variance in income distribution, introducing measures for poverty alleviation and assisting vulnerable groups in the society; and sustainability aims at the conservation of the natural resource base for use by present and future generations.

It is proposed that, at a later stage, a multi-disciplinary team will work on the transformation of the programme into a road map for sustainable agricultural development in the country (see Chapter XVII). This document provides a starting point for this process.

V. TOWARDS A STRATEGY FOR SUSTAINABLE AGRICULTURAL DEVELOPMENT: TEMPORAL AND SPATIAL DIMENSIONS[2]

Objectives

The strategy's objectives would be highly integrative within a holistic approach. The strategy should be also executed through the utilisation of a highly participatory approach where the national, regional and local authorities as well as stakeholders, including small farmers, women and vulnerable groups, would be actively involved in the programme's design and implementation; and would, therefore, assume its ownership.

With the above principals in mind, the following are the main objectives of the strategy:

i. Supporting efficient and sustainable increase in food and agriculture production

As noted above, the main objective of the strategy is to put the agricultural sector back on the "right" developmental track through an efficient, sustainable, equitable, participatory, environmentally sound agricultural and rural development process. This is to be achieved in an integrated approach where the linkages over time (temporal) and space (spatial) are highly emphasised. The process would also aim at achieving this goal in a highly participatory approach where stakeholders' ownership of the strategy assumes high priority.

ii. Improving food security and nutritional intake

A corollary and complementary objective to increasing agricultural and food productivity under the strategy, is to improve food security and nutritional intake.

According to FAO definition, food security includes four main dimensions: a) increasing agricultural and food productivity in an efficient and sustainable manner; b) reducing the variability in the productivity and supply of food and agricultural products; c) enhancing the access to food and improved nutrition by the low-income segments of the population; and d) improving nutritional intake through optimum utilisation of food as the result of a well-balanced and healthy diet.

iii. Reducing rural poverty

This objective is an integral component of the food security objective and nutritional improvement. Explicit efforts and operational measures to achieve this objective will be carefully designed and incorporated in the strategy. Appreciating the multi-disciplinary nature of the objective, it will be pursued in close collaboration with other concerned bilateral and multi-lateral agencies in the field, e.g. UNOHCI, OIP, WFP, UNDP; and, in close collaboration with the national, regional and local authorities as well as other stakeholders, as appropriate.

iv. Enhancing environmental protection and conservation of the natural resource base

The strategy would aim at achieving the above objectives, while conserving the natural resource base and enhancing environmental protection. This is an important objective for ensuring sustainability of the developmental process. To this end, environmental protection measures, including such activities as conducting environmental impact assessments, would be carefully identified, analysed and incorporated as an integral component of relevant interventions under the strategy.

Temporal dimension of the strategy: short, medium and longer-term actions

The temporal dimension of the strategy implies that measures and actions to be undertaken should be designed and implemented within a chronological sequence that is classified into short, medium and longer-term activities. In this regard, the most important principal that should be adhered to is the linkages and consistency among these temporal actions. Thus, measures to be taken in the short term should, as far as feasible, be consistent with and conducive to the medium and longer term objectives.

Short-term actions

i. FAO and the UN humanitarian appeal

At the outset of a current UN Flash Humanitarian Appeal for Iraq (2003), an overview of the state of food availability and nutritional intake in the country was indicated as follows: "Since the first Gulf War, when sanctions were imposed on Iraq, the people of that country have had to rely on the international community for their survival needs. Today in 2003, sixty percent of the twenty-seven million Iraqis are totally dependent for their food requirements through the Oil-for-Food Programme. With the outbreak of the present conflict and the suspension of the Oil-for-Food programme, their situation is likely to become desperate as distribution systems are disrupted and the availability of rations is seriously impaired. Household food stocks are already in short supply in some areas and are likely to become further strained. Prolonged hostilities may therefore result in a serious humanitarian crisis amongst a population already rendered vulnerable by poverty and seriously degraded services. Women and children are at greatest risk." (UN. 2003.)

The appeal added that "the United Nations will provide humanitarian assistance to affected populations, whether inside Iraq, or in neighbouring countries. It will provide this assistance in accordance with International Humanitarian Law and in accordance with the principles of neutrality and impartiality that underpin the mandates of emergency response agencies".

It further indicated that: "This (UN) Flash Appeal (at a preliminary estimate of US$ 2.2 billion) has two key components: food and non-food needs. It is axiomatic that food needs will be a vital element in our overall response given the overwhelming reliance of the greater part of the Iraqi population on rations distributed under the Oil-for-Food programme. It is vital that the pipeline of supplies is restored as quickly as possible. Meanwhile, UN planning is premised on the need for WFP, over the coming six months, to assume responsibility for feeding most of Iraq's population (430,000 tonnes per month)".

Emergency food security. As regards emergency food security, the Appeal stated that: "substantial efforts have been made over the last decade to increase food production in Iraq. As a result, large segments of the population were able to supplement the food basket provided by the government with local fresh products at affordable prices. However, full-scale sector rehabilitation has not taken place, while the local infrastructure and the previous capacity to produce agricultural inputs have not been entirely restored. Consequently, local food production continues to rely on the import of agricultural inputs. The cereal harvest in May/June 2003 is expected to provide some 1.7 million tons of grain (or 25/30% of total grain requirements). The current conflict in Iraq, however, is generating considerable population displacement, loss of assets, damage to infrastructure, breakdown of communication networks and trade, as well as disruption of food production activities. To mitigate the impact of the crisis on the population, it will be vital to ensure timely provision of support to the agriculture sector, so as to allow for the continuation/restart of current food production activities and decrease the dependency on imported inputs."

Objectives of FAO's contribution. The Appeal highlighted the FAO's programme goal as to sustain food security and the nutritional status of the population, so as to make sure that humanitarian needs of targeted vulnerable groups engaged in agriculture and food production activities in rural and peri-urban areas are addressed. The immediate objectives of FAO intervention will, therefore, be to:

Roles and responsibilities of FAO. FAO has been present in Iraq and contributed to the development of the agricultural sector since 1979. More specifically, since 1997, FAO has been implementing the agricultural component of the "Oil-for-Food" Programme. In the current crisis, FAO is evaluating the impact of the conflict on the agricultural sector, estimating the immediate emergency and short-term rehabilitation needs, with particular emphasis on vulnerable groups amongst the affected population and implementing activities aiming at re-establishing food security and rehabilitating food production. In collaboration with other relevant UN agencies and programmes (particularly WFP and UNICEF), FAO is monitoring the food security and nutrition situation in the country is setting up a coordination mechanism to support essential food production activities.

Profile of beneficiaries. The entire Iraqi farming community - or some 30% of Iraq population - will be targeted, while taking into account each agro-ecological areas and farming systems. Emergency and short-term rehabilitation assistance will be identified, with particular emphasis on the needs of the vulnerable groups. Activities aiming at re-establishing food production will benefit the whole Iraqi population. It is currently estimated that over 18 million people will be food insecure (and, therefore, highly vulnerable) in the country during and after the ongoing conflict.

Response strategy. The Appeal further stated that: "the (agricultural) sector objectives will be reached by: strengthening the resilience of farm communities in the country (wherever access will be possible), through the provision of support to farming and livestock activities. More specifically, FAO will ensure the continuation of the current level of emergency agriculture inputs distribution to support local food production, rural livelihoods and income generation. Particular attention will be given to vulnerable families, including the resettlement of returning refugee and IDP farming families. Providing timely technical assistance to the various organizations involved in agriculture, which will support food security through enhanced monitoring, co-ordination of sector activities and provision of specialised technical advice. Minimum emergency agricultural relief activities would be targeted to support: (1) plant production; (2) poultry production; (3) animal disease control; (4) irrigation and (5) food security monitoring. Overall reconstruction needs would have to be assessed as soon as the access situation will allow. If successful, this programme will also result in a substantial corresponding decrease in food aid."

Funding Requirements for emergency food security:

Activities and Services

Amount (US$)

FAO


Emergency support to Iraq summer crop production

300 000

Emergency support to winter cereal planting in Iraq

10 505 000

Emergency support to Iraq poultry production

2 442 000

Emergency assistance for animal disease control in Iraq

10 465 000

Rehabilitation of irrigation infrastructure and emergency water supply

14 435 000

Support for a food security and nutrition surveillance and monitoring capacity in Iraq

1 375 000

Emergency livelihood support to vulnerable rural population in central Iraq

1 518 000

Management of agricultural emergency relief efforts in Iraq

5 000 000

FAO total

46 040 000

Total emergency food security sector

46 040 000


ii. FAO's contingency plan

In the short term, the FAO strategy also includes the preparation of a contingency plan for meeting the essential needs for immediate relief and preliminary rehabilitation activities of the agriculture sector in the country, (FAO. 2003c).

The preparation of the plan is based on an assessment of the potential inputs demand for key inputs to resume agricultural production following the end of the current events in the country. Inputs demand are estimated at the current production levels (e.g. area of major crops) at the recommended rates. The potential inputs demand is then compared with the volume of products provided under the Oil-for-Food Programme to give an indicative level of the potential market share supplied under the Programme. This market share would then become the basis for an emergency programme in the absence of a "crises".

Under the draft emergency plan, it is assumed that in the advent of a crisis the Oil-for-Food Programme's share of the potential market would in fact decline due to:

The Plan market share would, therefore, be adjusted for impact of the "crisis" for all inputs other than seed.

Prior to the crisis, Iraq was self sufficient with respect to cereal seeds but imported vegetable and oil seeds. Following the end of the current events in the country, it is assumed that:

The period over which the emergency plan would operate is clearly defined. It is assumed that the emergency plan would be operational over the last two quarters of 2003. Thus, the emergency plan acknowledges the seasonal nature of agricultural production. The inputs provided under the plan would, therefore, be directly related to the seasonal demands of the agricultural sector during the operational period.

The emergency plan assumes that the impact of the "crisis" will not be uniform over the whole country. As a basis for implementation the following geographical/ regional groupings of Governorates are suggested:

It is further assumed that interventions in the northern and Southern Governorates will be possible from May/June 2003, in the northern Central Governorates June July 2003 and the Central Governorates July/August 2003

The emergency plan discusses possible interventions on a sub sector basis namely: Crop Production, Infrastructure Rehabilitation, Poultry Production and Animal Health. The input priorities, identified under the emergency plan, include the following:

Medium to longer term-actions: sustainable livelihoods

In the medium to longer-term, the FAO strategy would aim at enhancing sustainable livelihoods in the agricultural and rural sector within a holistic approach for sustainable agricultural and rural development. The following is an overview of the main perception of sustainable livelihoods.

Increasing agricultural and food productivity is a necessary but not sufficient condition for the sector's sustainable development with the view to improving farmers' incomes and enhancing food security. For instance, measures to introduce efficient agricultural technologies (e.g. for increasing crop and livestock based agricultural systems), would not work if not accompanied by effective local capacity building through relevant extension and training programmes. Development measures to improve agricultural productivity could fail unless complemented by necessary services such as agricultural marketing, rural credit and micro-finance. Successful implementation of an effective sustainable development programme requires certain complementary improvements in local and basic infrastructure, such as feeder roads and small scale irrigation systems. Further enhancing of farmers' incomes, reducing rural poverty and improving household food security, require diversification of the agricultural farming systems.

These approaches draw on FAO's experience with the Special programme for Food Security (SPFS). Under this highly participatory programme, a major component is to diversify the farming system with the view to meeting such objectives as increasing employment, generating income and reducing rural poverty particularly among women and vulnerable groups. Other major relevant components of the SPFS, such as participatory constraints analysis and positive nutritional outcomes are incorporated in the strategy and would be discussed in sections to follow.

With the above in mind, the main components of sustainable livelihoods for agricultural and rural development in Iraq could include: i) maximisation of agricultural productivity; ii) rehabilitation and access to agricultural services; and iii) diversification of farming systems for increasing household's access to food and income.

i. Maximisation of agricultural productivity

To maximise agriculture and food productivity on a sustainable basis, an efficient and equitable rehabilitation programme for each sub-sector within the appropriate farming system approach needs to be designed and implemented. The programmes should be integrative, participatory, technologically appropriate, economically viable, socially acceptable and environmentally sound. The programmes should, therefore, lead to natural resource conservation and environmental protection.

ii. Reconstruction and improved access to agricultural services

Given the special political conditions in the country and following the years of sanction, the limited availability and access to agricultural services, particularly agricultural marketing, rural credit and improved basic local infrastructure, are major constraints to sustainable agriculture and rural development in the country.

To overcome these constraints, it is proposed to establish a "Socio-economic Committee" to work in close collaboration with national, regional and local authorities, stakeholders, and other concerned UN agencies, on addressing these issues. The Committee will carefully examine these constraints taking into account such aspects as possible initial setting of community based rural credit system including a revolving fund.

To this end, it is further proposed to conduct an in-depth study on the indigenous structures which undoubtedly have developed in the meantime. The study would examine how linkages could be effected between borrowers and any lending structure which would be established, with a view to harnessing existing forms of solidarity as collateral (or additional collateral).

iii. Diversification of the farming systems: Increasing households access to food and income

This concept is based on the above-mentioned FAO's experience with the Special Programme for Food Security. Under this programme, a major component is to diversify the farming system with the view to achieving such objectives as: increasing farmers' incomes; enhancing households' access to food, improving role and contributions of women to agricultural production. The diversification process implies integrating other farming activities with crop production such as small ruminant animals (e.g. sheep, goats), poultry, beekeeping, cottage industry, etc. This aspect also goes beyond the agricultural sector where complementary rural activities for income generation are also envisaged.

Some of these small-scale enterprises are already incorporated and emphasised under the current rehabilitation programme in the country, particularly poultry. The cropping system itself could be also diversified through such activities as intercropping and introduction of certain crops that are less common than traditional crops, e.g. sunflower. In many a country, FAO/SPFS has success stories on the diversification of farming system and income sources within and beyond agriculture as one of the measures for enhancing household food security and nutritional improvement. This approach is, therefore, incorporated in the strategy.

Supporting rural poverty alleviation

A major aspect of the strategy is to integrate additional services and support required by small farmers and rural communities for sustainable development and rural poverty alleviation. It is proposed that the integrated approach be tested on a pilot basis in two to three selected villages/districts per Governorates in the country with the view to establishing a model for replication. FAO's experience in this field such as the work on SPFS and the initiatives by ESN and SDA on similar pilot schemes would be most relevant. Close collaboration with the national, regional and local authorities along with other UN agencies particularly UNOHCI, WFP, UNDP, and NGOs is recommended to broaden the scope for integrated sustainable development beyond the agricultural sector.

More specifically, this initiative could serve the following main purposes:

- To progressively transform the role of farmers and communities from beneficiaries to actors and partners in development;

- To formulate a model for community-based, integrated and sustainable development which provides the basis for broader replication;

- To launch within FAO and implementation partners a 'learning by doing' process to strengthen the programme's own capacities for implementing integrated development; and

- To create awareness among the agricultural and rural population in the country towards integrated development.

Furthermore, the strategy incorporates a process for the identification of vulnerable groups such as, female headed households, drought stricken farmers, internally displaced people (IDPs), etc. and their needs. This process would be initiated under the "comprehensive needs assessment" noted above.

To assist in this process, it is proposed to establish a particular "database" for this purpose. In addition, following the SPFS approach, the strategy incorporates a participatory constraint analysis approach to identify the main constraints to reducing rural poverty and highlights ways and means to overcome these constraints.

As regards the nutritional intake of the population, FAO and WFP have prepared food supply and nutritional assessment reports in 1995, 97, 98 and 2000. The reports made a number of recommendations for improving the food and nutritional situation in Iraq, e.g. improving food availability and consumption, supporting the food industry and improving food safety, upgrading water and sanitation systems, supporting nutritional and health services including for schools, promoting appropriate feeding practices and healthy lifestyles, and in general enhancing nutritional education and communication. These measures are incorporated in the strategy as appropriate.

Enhancing enabling environment

The strategy includes a set of measures to create an enabling environment (meaning conditions and/or mechanisms that must be met and further enhanced in order for the programme's objectives to be achieved). The enabling environment would naturally vary in accordance with the programme's components and activities. The following is an overview of the main conditions and/or mechanisms that are essential for the development process:

i. Supporting participatory approaches

Drawing on the successful FAO experience with SPFS, participatory approaches are essential for successful implementation of the strategy.

With improved local capacity and technical assistance to support the local institutions, effective participation should assume high priority. While the entire programme should be conducted following a participatory approach, participation is especially essential for certain activities. These activities include inter alia "participatory constraints (and potential) analysis", IPM and "water users associations".

ii. Improving basic rural infrastructure

Another enabling environment for the success of the programme for the agricultural sector is to improve the deteriorated basic rural infrastructure. Particularly in remote areas, farmers' access to market is seriously limited. Basic rural infrastructure does not only refer to transportation, but also to such facilities as communication and other supporting services.

In this regard, distinction should be made between "basic" (small-scale) infrastructure that is relevant and essential for the process, and "large-scale" infrastructure that is essential for development and longer term progress. The focus here is on the sequential process for such investments. The improvement of "small-scale", basic infrastructure is, indeed, a prerequisite for the "larger", longer-term investments. An optimum mix is called for in this process.

iii. Supporting local capacity building

In view of the long period of sanctions, the country is virtually isolated from the international community. Local skills, therefore, needed to be strengthened through active participation in the design and implementation of the developmental programme. A major sub-programme for supporting local capacity building is, therefore, included in the strategy. This would include substantial support to agricultural research, extension and training, In addition as a follow-up to the above need for supporting capacity building, there is an urgent need to provide technical assistance to support the local institutions in carrying out the strategy. More quantitative details on these activities, however, would be needed.

iv. Encouraging the role of the private sector

The important synergy between the public and private sectors in relation to the implementation of the programme in the agricultural sector cannot be over estimated. Thus, while the private sector can assume an important, sustainable and efficient role in the implementation of the rehabilitation programme for agriculture, the role of the public sector is equally essential. The role of the public sector could include such functions as streamlining regulations and procedures, improving access to finance, simplifying trade restrictions and improving basic infrastructure. For the success of the programme, the challenge of getting the "balance" among these complementary functions should be met. This calls for further consultations with the national, regional, local authorities as well as the stakeholders.

It is also appreciated that the civil society and the NGOs could play an important role in the implementation of the programme for the agricultural sector. This could include such activities as the provision of information for early warning systems, vulnerability targeting, ensuring basic social services, and small-scale cottage industry for small farmers and women. Therefore, such activities are carefully incorporated in the strategy development.

Spatial dimension of the strategy

The spatial dimension of the strategy assumes high priority in Iraq due to the substantive technological, social and economic diversity among various regions in the country. The strategy, therefore, adopts a spatial approach for the development of the country where the specificity of various regions is taken into consideration. As will be discussed at a later section of the document, an efficient and equitable regional decentralisation process for sustainable development of the rural and agriculture sector in the country would be highlighted under the strategy.

Guidelines for spatial agricultural development in Iraq

Based on FAO's experience, the following guidelines represent a number of ways in which the GOI could accelerate regional decentralisation for agricultural development planning in the country:

VI. AGRICULTURAL POLICY, FOOD SECURITY AND PARTICIPATORY RURAL DEVELOPMENT

The formulation and implementation of appropriate agricultural policy in Iraq are essential elements in the transitional process for achieving food security and sustainable agricultural and rural development in the country. Agricultural policy cannot (should not) be formulated in isolation of the national macro-economic setting as well as without due consideration to the linkages between the agricultural sector and other non-agricultural sectors of the economy. Thus, a comprehensive approach for agricultural policy and food security is highlighted under the key principals to be incorporated in the road map for the transitional process in chapter XVII. Meanwhile, an overview of the key principles of a participatory rural development approach is presented below:

In earlier decades (the 1950s and 1960s), the agricultural sector was often viewed as the passive partner in the development process (e.g. the Lewis model for development). It was widely believed that industrialization, particularly urban development of the modern sectors, was a vital strategy for development. The leading manufacturing sectors would pull along with them the backward agricultural sector. Industry would provide a source for alternative employment for the rural population, generate a growing demand for food and agricultural production, and supply the agricultural sector with the industrial inputs. The agricultural sector would provide industry with the needed "surplus" labour and "cheap" raw material.

Accordingly, the bulk of investments in developing economies were recommended to be directed towards the industrial and/or oil sectors. Key agricultural policy prescriptions that followed from this perception discriminated against agriculture and were biased towards the industrial sector. For instance, a policy of heavy/universal food subsidies that were partly funded through controlled "low" farm-gate prices (lower than world market prices) was such a policy that aimed at reducing urban/industrial wages. This policy was widely used. This popular policy measure aimed at encouraging the above strategy of transferring labour and agricultural surplus to industrial sectors, and led to turning the terms of trade against agriculture. But, as indicated by Thorbecke (1969), "... the trouble with this approach was that the backward agricultural goose would be starved before it could lay the golden egg".

Recently, therefore, it became increasingly evident that the functions which industrial, agricultural and rural sectors must perform in the process of economic growth are interdependent. Thus, it has been strongly emphasized that "... agricultural development must be fully integrated within a comprehensive multi-sectoral approach for national development." (Bishay, 1974). The same notion has also been advocated and further elaborated by the World Bank: "...agricultural growth stimulates economic growth in non-agricultural sectors, which results in increased employment and reduced poverty. Sustained non-agricultural growth, particularly in the poorest countries, is not likely without first addressing agriculture. An adequate linkage of the rural and urban economies through the food marketing system is essential to foster growth across the national economy and sustainable growth of the rural economy", (World Bank. 1997).

In view of the above, rural development aims at the simultaneous achievement of highly interrelated objectives. These objectives include: reducing rural poverty and hunger; raising - a widely shared and labour intensive - economic growth; increasing food production; investing in human development; enhancing the access of the rural poor to natural resources, basic infrastructure and social services; and halting the degradation and promoting the conservation of the natural resource base.

These objectives and a strategic "checklist" for their realization are reflected in a World Bank (1997) perception of rural development as a "vision" and "actions" that include the following dimensions of the process:

The vision for rural development includes (World Bank. 1997, p.4):

A strategic checklist for actions to achieve the above vision includes:

With the above perceptions in mind, and appreciating the integrative nature of the process of sustainable rural development discussed above, the main variables, linkages, feedback and interrelated processes of a participatory rural development strategy could be summarized as follows:

First, at the core of the strategy is a well balanced set of sustainable growth based objectives of rural development (as discussed above). These objectives focus on the achievement of a sustainable, widely shared, employment generating economic growth. Thus, while economic growth is the engine of rural development, its nature, pattern and scope matter.

Second, Rural development goes beyond agricultural development. Thus, off-farm activities and rural-urban linkages provide the key variables and linkages for rural growth. Agricultural development finds its basis in irrigated and rain-fed agriculture. The key policies for agricultural development including, inter alia, investment mobilization (both public and private); liberalization policies for efficient markets at the macro-economic, the sector, and the projects levels; liberalization of domestic and international agricultural trade; institutional reform; sustainability in natural resource management; availability and access to the natural resource base (water, land, capital, and appropriate technology); and supporting services - e.g., research and extension. Off-farm activities (e.g., agro-industry) and rural-urban linkages should lead to widely shared rural growth.

Third, labour-intensive rural growth leads to stimulating higher demand for labour, generating further rural employment, reducing and/or reversing the rural-urban migration process, reducing rural poverty, increasing rural income, and finally contributing to the overall rural development objectives highlighted above. At least at the current transitionally period in Iraq, employment generation activities for the local population should assume high priority.

Fourth, the social sectors and human resource development is a main dimension of rural development. For an effective and participatory rural development process, investment in social sectors and human resource development are essential ingredients. These investments - both public and private - are essential for improving the supply and access of the rural population - particularly the rural poor - to basic education (e.g., universal primary education), health, and infrastructure (such as potable water, sanitation, family planning, etc.). The main source of investment in the social services in Iraq comes from the oil revenues, social transfers and cultural values and principles. To this end, the role of the newly established Development Fund for Iraq can not be over-emphasized.

Fifth, in addition to these transfers, investment in social safety nets provides further enhancement to the access of the poor including vulnerable groups to the social sectors (see Chapter XV below).

Sixth, investment in human resource development would improve productivity and participation, and, hence contributes to rural growth which in turn contributes to the overall economic growth, increasing income, savings and investments and thus perpetuating a "virtuous circle". Given the years of isolation under the sanctions in Iraq, investment in human resource development should assume highest priority.

For this strategy to be pragmatic and operational, it has to be highly participatory and focuses on human resource development as the fundamental principle. Once this process is owned, designed, and implemented by the Iraqi people, particularly the grass roots level, it would evolve in a natural and systematic way. This widely shared growth pattern, the investment in human development, and the "ownership" of the Iraqi people of this development process would equip the rural population to be able to participate in the decisions and the implementation of this participatory approach and hence be included in the development process.

It is this inclusion of the farming community in general and the vulnerable segments of the population in particular in the development process that contrasts this approach with the earlier "integrated rural development projects". According to a World Bank publication (1997) "... These integrated rural development projects failed due to being excessively centralized and top-down. Most decisions regarding their design and implementation were made by central government officials, and communities were rarely involved in project design, implementation, or monitoring" (Ibid, 1997). The current challenge of a nation-building in Iraq is also augmented with the potential of starting on the right track. Thus, the potential for the design and adoption of this participatory strategy is high.

Participatory constraints analysis: a pragmatic approach. The above discussion shows the substantial range and diversity of issues, aspects and decisions that countries face in the design and implementation of rural development. In order to be able to practically meet this challenge, it is proposed to carry out a participatory constraint analysis, on a continuous basis, as an integral component of the proposed SPFS approach to be adopted in the process. This pragmatic approach addresses rural development through the identification, analysis, and prioritization of the most binding constraints to rural development to be addressed and resolved in a systematic way.

More specifically, a participatory constraint analysis would have to be carried out, by concerned partners in the development process: e.g. farmers, community organizations, Government, aid agencies, private sector, NGOs, etc. The analysis would identify the constraints hindering the development of the sector and select the means to overcome these constraints. In some cases, immediate action can be taken at the local level to remove identified constraints, but addressing the more complex constraints, often of a cross-sectoral nature, requires more time and planning. Nevertheless, they must be addressed on a participatory basis. In this process, farmers are encouraged to articulate their own perceptions of constraints impeding increases in productivity and production stability, and to seek as much as possible to identify actions which they could undertake themselves to remove or minimize the negative effects of these constraints.

Where outside action is required, farmers should be also encouraged to participate in beginning a dialogue with those responsible for taking the necessary action, and pursuing this dialogue until a favourable response has been obtained. Local partners, such as District officials, traders, and NGOs should participate with farmers in this process. Many constraints would already be the target of studies, programs and projects at national level. Rural development should take advantage of such ongoing initiatives by linking them more directly to farmer-identified needs. In-depth studies of specific identified constraints should be commissioned when additional analysis is considered essential for formulating viable action proposals.

The needs assessment process, to be launched by FAO in close collaboration with concerned UN agencies and other partners in development, is a starting point for participatory constraint analysis. The point here is that constraint analysis should be carried out on a continuous basis that is beyond the current stages of relief and rehabilitation.

FAO Anti-hunger Programme

Appreciating the current food security disastrous situation in the country as a result of the many years of sanctions, inappropriate agriculture policies by the old regime and such recent events as lootings and serious damages to the sector's infrastructure, an exceptional case of the existence of "hunger" in an "oil-rich" country has unfortunately emerged. This is, indeed, a unique situation in Iraq, where there is a need to dismantle a very large safety net programme in support of a more sustainable twin-track approach on poverty and hunger reduction, where agricultural productivity and rural livelihoods are strengthened, while safety nets are brought down to meet sufficient access to food for the most needy population groups only.

While it can, correctly, be argued that this is a temporary situation, addressing the problem is essential. To this end, the following section presents the key elements of policies for priority areas of FAO Anti-Hunger Programme (FAO. 2002b) that should be adopted on an emergency basis and as a "special case" in Iraq. These policies include the following:

Improve agricultural productivity in poor rural communities. The key policy issue in this priority area is strengthening the ability of rural communities, especially those that are poor and vulnerable, to organize themselves and play an active role in matters that affect their livelihoods (see also Chapter XV below). This should lead to the improved availability and adoption of technologies that are appropriate for the needs of the rural poor.

Associations of smallholders and rural community organizations, in coalition with civil society organizations, can play an important role in redressing some of the most serious handicaps faced by their members and non-members. These include insufficient access to natural, financial and human capital, lack of access to appropriate technologies and income-earning opportunities, high transaction costs and insufficient access to markets, lack of access to information, communications services and other public goods such as health and sanitation services.

Develop and conserve natural resources. Given the current situation in the country, the scope of bringing additional natural resources into agricultural production (notably land and water resources) is limited. A viable option is sustainable intensification, i.e. increasing the productivity of land, water and genetic resources in ways that do not compromise unacceptably the quality and future productive capacity of those resources. The policy environment must ensure that intensification is indeed sustainable and beneficial to the populations involved.

The development of baseline information on renewable natural resources and monitoring their dynamic changes as well as early warning of environmental impacts are an essential dimension of natural resource management. Practical decision-support tools for local farmers need to be developed as an important component in capacity building for a participatory approach to developing and conserving natural resources.

With regard to water, the key policy issue is the growing competition between water requirements for agriculture and other water uses (domestic, industrial and ecosystem). As agriculture is by far the largest water user, an efficient use of water for agriculture should be the starting-point for expanding water availability for other uses.

A key challenge is to find the appropriate balance between improved rainfed agriculture and intensive irrigation so as to improve agricultural potential while promoting food security and poverty reduction. Policies affecting agricultural water use must provide incentives for efficiency gains and ensure that water scarcity is appropriately signalled to water users. Transparent, stable and transferable rights to water use for individual users or groups of users are powerful instruments for promoting efficiency and distribution equity (see Chapter VIII below; and for more details see the Annex on water resources and irrigation in the Three-year Programme for the northern Governorates).

Concerning land for agricultural use, the most important policy issues concern access and tenure (individual or community ownership, rental or longer-term user rights), improved land management practices and investments in soil fertility with a long-time horizon. Ensuring access to land will significantly contribute to its sustainable use. In this context, strengthening women's rights to own and inherit land is particularly important. Policies should recognize the complexity of existing land tenure systems and of formal and informal arrangements regarding land use rights.[3]

Ensuring present and future access to sufficient diversity of genetic resources for food and agriculture requires policy action at both the international and national levels. Regarding the conservation and sustainable use of plant genetic resources, the policy framework is set out in the International Treaty on Plant Genetic Resources for Food and Agriculture and the Leipzig Global Plan of Action. However, the measures contained in the treaty need to be integrated into national agricultural and rural development programmes. An appropriate regulatory framework for variety release and seed distribution that facilitates synergies between the public, private and informal seed systems needs to be established. For animal genetic resources, international and national regulatory frameworks still need to be developed to guide actions at the national level. The role and participation of Iraq in these treaties needs to be worked out during the transitory phase.

For fisheries, the critical policy issue is to limit access to natural fish stocks where the capture, particularly marine, has reached or surpassed sustainable limits, (see chapter XI). Respecting limits on access to fish stocks requires that governments and fishing communities share authority and responsibility for making decisions about the use of fisheries resources. During the 1990s, several global agreements were reached on how to manage marine capture fisheries in a manner that would ensure conservation and long-term sustainable use of marine ecosystems. Among these is the Code of Conduct for Responsible Fisheries, adopted by the FAO Conference in 1995, and the 1995 United Nations Fish Stocks Agreement, which came into force at the end of 2001.

In forestry, policies and institutions are needed to ensure full accounting of the value of the resource and benefits that accrue to the various members of society (see Chapter XII). These need to be incorporated into decision-making on utilization and conservation. Policies should encourage and promote the participation of key stakeholders in forest planning and management. In many cases there is a need for greater transparency and accountability in policies affecting forest access and management. Institutional strengthening and coordination at the national and international levels is needed to ensure the inclusion of non-market values associated with forests, such as biodiversity, carbon sequestration and watershed protection. It is also important for policies affecting the management of forest resources to give recognition to the food security buffer role they play for the poorest members of society in Iraq.

Expand rural infrastructure and broaden market access. A critical policy problem in the provision of infrastructure is addressing the relative neglect of poor rural communities. While involvement of the private sector in infrastructure construction and servicing may increase efficiency and respond better to overall needs, it may also mean that poor farming regions continue to be underserved. The public sector should maintain an active role in infrastructure provision that benefits the poor, for example the provision of secondary or rural roads. The policy approach should encourage decentralization and community participation in infrastructure investment planning, implementation, maintenance and financing to ensure demand-driven, sustainable service delivery and consider various forms of public-private partnerships (see Spatial Dimension of the Strategy in Chapter V).

Enhancing market access implies that coordinated policy, legislative and regulatory frameworks consistent with international obligations for food safety, plant and animal health are in place. To this end, policies must be enacted and enforced. Private-public partnership ventures, from supply through certification facilities and services, and flexible approaches to the progressive compliance with standards are effective means in strengthening access to trade.

Strengthen capacity for knowledge generation and dissemination. Policy action should aim at ensuring that the poor share the benefits of technological progress (agricultural, information, energy and communications). This is particularly so for areas with poor agro-ecological potential, which are usually sidestepped by private commercial research. Public funding is required for the development and/or adaptation of technological options for those areas.

Policies should promote technological options that address the twin goals of agricultural productivity and environmental sustainability. In the short term, research policy should focus on identifying and removing constraints to the adoption of practices that promote an optimal use of existing technologies, including organic agriculture, conservation agriculture and integrated pest management. New technologies are needed for areas with shortages of land, water or labour, or with particular problems of soil or climate. The promotion of labour-saving technologies is needed to respond to labour shortages. Participatory approach to technology design and generation is highly recommended. Farmers' organizations, women's associations and groups and other civil society organizations should promote the necessary partnerships between farmers and scientists so that technological options are demand-driven and relevant. National policies should facilitate the establishment of functional linkages among research, extension education and communications, (see Chapter XIV).

Ensure access to food by the most needy through safety nets and other direct assistance programmes. Policies conducive to the achievement of this priority area should, inter alia, be derived from a human rights-based approach. As noted above, this is absolutely essential in the short-term in Iraq. A key policy prerequisite is the existence of information that identifies accurately who the hungry are and where they are located. FAO and the World Food Programme (WFP) can assist the GOI in effective targeting, through the Food Insecurity and Vulnerability Information and Mapping Systems (FIVIMS) and the Vulnerability and Mapping System (VAM).

Programmes to provide direct assistance to the hungry can only succeed when national governments establish effective capacity for the delivery of such assistance. This requires a supportive national policy environment for the development of social safety nets, which can be provided in cooperation with civil society organizations. Social safety net policies specifically targeted at hunger reduction should give recognition to the special vulnerability that women and children have to malnutrition at critical times in their lives and should support the creation and implementation of programmes such as mother-child feeding, related health and nutrition education and school feeding (see Chapter XV).

A national commitment and relevant policies towards gender equality and women's rights is essential to enhancing access to food. At the household level, an improved status of women has been shown to be the most important single variable in reducing malnutrition. To conclude, a policy commitment by the GOI and non-state actors is essential for international humanitarian assistance to ensure access to food during the current difficult period the country is facing.

Agricultural price policy issues: Revisiting the highly subsidized "food basket"

As noted earlier, given the special circumstances in Iraq during the last decade, the highly subsidised "food basket" has been an essential price policy measure to ensure food security and avoid possible famine. Following the current events in the country, it seems that the continuation of subsidised food for consumers will be needed in the short run. This important issue of food subsidies as an essential instrument for food security under the country's given circumstances brings into attention agricultural price policy as a major policy issue in the country. This section, therefore, focuses on agricultural price policy issues and draws lessons of experience for Iraq.

Notwithstanding the above, there are a number of shortcomings of the subsidized food-basket policy as has also been indicated earlier. The food items in the basket have been mostly imported; and the food baskets have been heavily subsidised-virtually free. Heavy food subsidy for imported food items has resulted in depressed domestic producer prices leading to price disincentives particularly for wheat growers. Thus, earlier FAO missions have recommended that the bulk of the food contents of the "food basket" should be acquired through procurement of grains from domestic producers. The balance could be obtained from imports. Such a policy could meet the nutritional objective without disadvantaging the Iraqi farmers.

Appreciating the continuing instability in the country, consumer food subsidies are expected to continue in the short term. However, in the medium to longer term there is a need for revisiting the highly subsidised food basket approach for meeting the basic nutritional needs of the population in an efficient and just approach.

To this end, this section provides some guidelines, for the formulation of appropriate agricultural price policy in Iraq based on FAO experience, (see FAO. 1987. and FAO. 1989.)

Policy formulation

As noted in a number of FAO price policy studies in most countries of the world, agricultural price policy is seen as a vital means of affecting agricultural output and income, consumer welfare and, through affecting the domestic terms of trade, having an important influence on growth, employment and income distribution in the general economy.

Meanwhile, according to FAO experience in many countries, the main objectives of agricultural price policy usually include the following:

These objectives, however, imply difficult policy conflicts and trade-offs which affect not only agriculture but also the entire process of economic development. The main trade-offs occur:

Although some of these trade-offs are difficult to quantify, experience in many countries in the Near East Region has shown that they are significant and can require governments to make abrupt and often counterproductive changes in agricultural price policy.

As regards the central lessons of experience, an analytical FAO document (FAO. 1989.) further noted that: "the central lesson is strikingly clear: agricultural price policy plays a pivotal role not only in agricultural development but also in overall economic development. This is particularly so in the medium and low-income countries where agriculture remains a dominant sector and where alternative sources of government revenues and foreign exchange are limited. In practice, policy implications of this basic situation often receive too little attention. Improvement must, therefore, start with a process of policy formulation which takes full account of the opportunities, limitations and side effects of agricultural price policy, including linkages between agriculture and the economy as a whole. It is particularly necessary that trade-offs and the need for reconciliation among multiple development objectives be recognized. Experience shows that an initial failure to formulate policy effectively in these regards only too often leads to expectations for production and consumption which are not met, as well as to serious aggravation of budgetary and foreign exchange problems.

Key factors which need to be taken into account when food and agricultural price policy is being formulated include:

Proper analysis of these factors is necessary for effective policy formulation; failure to account for them most often results in poor, or unexpected, agricultural performance, unexpected budgetary and foreign exchange problems and, in some instances, crises which threaten lives. It is, however, a fact that most countries do not appear to take all of these factors into effective consideration, nor do they adequately investigate the impacts, costs and benefits of alternative approaches in the formulation of their agricultural price policies.

Producer policy

"Experiences with price policies in most countries carry several lessons for future policy choice in Iraq. First, failure to provide incentive prices is almost always penalized by inadequate production growth. In view of the need to tax agriculture and the difficulty or impossibility of introducing income taxes, experience strongly suggests the value of instituting other non taxes on agriculture, for example a land tax, and closely re-evaluating other sources of fiscal revenue, rather than reliance on unduly low producer prices at the transfer mechanism. More attractive producer prices alone are not a panacea for solving production problems, but they are an essential prerequisite.

Conflicting evidence exists as to the value and effectiveness of input subsidization either in increasing agricultural production or in providing more adequate and more equitable incomes in agriculture. Most experience in the Near East region indicates that subsidies have not offset the income effects of low producer prices. Evidence as to their effectiveness in promoting a more rapid adoption of technological improvements is mixed. Subsidies can assist in this respect but unless they are carefully designed and well administered, they may have very adverse effects on income distribution. Larger farmers tend to receive most of the benefits and smaller producers suffer through lack of access to subsidized inputs, often in limited supply, and thus fall behind through their relative inability to adopt new, more profitable technologies.

To be effective in influencing agricultural production so as to achieve desired growth and output levels, price policies must have strong elements of consistency, continuity and be effectively administered. Otherwise, announcements on support price levels may be ignored by farmers and the expected resource allocation and investment decisions will not occur. Continuity and credibility in implementation are also vital.

Consumer programmes

The evidence on consumption programmes and subsidies in the Near East region suggests that while general subsidies on specific foods have had beneficial impacts on consumption and nutrition, their effects on overall food prices and hence the cost of living and on wage-levels are less certain. To the extent that they do not hold down the overall level, of food prices, doubt is cast on a frequent argument for large consumer subsidies. Moreover, evidence on general subsidies shows their tendency to be regressive and costly. Most benefits accrue to middle-income segments of the population, a leakage which is hardly a priority use of scarce fiscal resources. One direct implication for food subsidies in Iraq is that the overall level of food subsidies should be reduced gradually and more attention given to other forms of targeting, such as district specific outlets for subsidized foods, as effective means of providing vulnerable groups with secure access to sufficient food.

Market intervention

Evidence suggests that operational monopolies in food and agriculture market are not necessary to control the performance of specific commodity markets. Such monopoly powers. whether public or private, may tend towards operational inefficiency, thus adding significantly to fiscal deficits or partially defeating policy objectives. In the rehabilitation and development of the agricultural markets in Iraq, therefore, due consideration should be given to market development programmes involving cooperatives and the private sector while retaining necessary roles for public marketing and supply agencies. By acting as buyers or sellers of last resort, or charged with operational responsibilities for public security stocks, these agencies perform essential functions in the achievement of particular policy objectives.

Intervention is also costly in terms of its demands for scarce administrative and management resources. The evidence on intervention in domestic fruit and vegetable markets indicates that marketing of these products is best left to the private and cooperative sectors.

Key aspects of price policy implementation in Iraq

Based on FAO experience, the following are the key aspects of price policy formulation that are directly relevant to the situation in Iraq:

Suggested guidelines for agricultural price policy: Formulation and implementation in Iraq

Also based on FAO experience in agricultural price policy in many developing countries, the following are suggested guidelines for agricultural policy formulation and implementation in Iraq:

Experience suggests that improvements in all the above aspects are needed in Iraq if the full potential of agricultural price policy to contribute towards agricultural and economic development is to be realized. It should be also emphasized that the medium and long-term plans and policy decisions which generally govern both public and private investment programme are linked effectively with the day-to-day operational decisions on agricultural price policy. It is the sum total of these operational decisions which largely determine the actual long-term performance of the sector, in the country. For an effective transitional process, such linkage should be established during the formulation of operational decisions so that long-term plans and investment expectations could be realized.


[1] An FAO (ESN)/WFP/ WHO Mission visited Iraq in May 2000. The objective of the mission was to assess the current food supply and nutrition situation in the country, particularly after two consecutive years of drought, and to compare the results with the findings of the previous assessment missions of 1993, 1995 and 1997. This section presents the summary of the Mission's report.
[2] This section draws on the conceptual perceptions presented in the document: FAO. 2001b, Part II.
[3] Further work on land tenure in Iraq has been recommended as one of the major follow-up activities to this report

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