Agriculture, the rural environment and the development gap
Times of definitions and choices: The case of Haiti
Agrarian reform and rural development strategies in Latin America and the Caribbean
RICARDO ABRAMOVAY is assistant professor in the economics department, University of São Paulo, Brazil.
In a reference book which has today become compulsory reading in Latin American social sciences, Fernando Fajnzylber (1987) divided the region into three sub-sets. In one group are Brazil, Colombia and Ecuador with remarkable economic performance and a harsh concentration of income. At the other extreme, Argentina and Uruguay, where wealth is distributed more fairly but growth is limited. The other nations (Bolivia and Peru for example) combine the worst of the other two with economic stagnation and persistent poverty. The absence of any significant historical experience with a system that balances fairness and growth has been responsible for this gap in Latin American development.
How can agriculture and the rural environment help to fill the gap? The aim of this text is to raise some of the main themes for consideration to help answer this question. First, information about demographics, economic trends and the past land system of large estates gives an overview of the particularities and the limits of agriculture in constructing a more integrated development model.
Next, the theme of agrarian reform as a way of combating rural poverty shows how the so-called 'new wave' in agrarian reform can expand, but not replace, the old reformist viewpoints. However, rural development policy cannot be reduced to agrarian reform. Recent studies on existing family farming perhaps offer the most important contribution for the creation of new paradigms for development in the countryside. Finally, it is illustrated that this family farming is not the same as small-scale production and that it can have fundamental social and economic roles in today's world. In particular, family farming may become the basis for building a civil society in the rural environment.
It is clear that some of the questions and the examples raised here refer to Latin America as a whole. Nevertheless, the reader should be aware that the text is mainly centred on Brazil.
Toward a new model of agricultural development
LESS THAN 30 YEARS AGO, one of the great international development specialists stated that under-developed countries are agrarian societies (Stavenhagen (1969), 1979:7). If this criterion were still valid, Latin America would already be a member of the rich countries' club.
Globally, only one-fourth of Latin Americans were living in the countryside in 1995 compared to 58 percent in 1950. The vast majority of the population lives in small towns.
In the comparative context of this workshop, it is important to stress two important aspects of this demographic situation.
a) The demographic weight of the rural population in Asia and sub-Saharan Africa creates a situation where agriculture (including non-farming activities in the rural environment) is the pole around which a joint campaign can be organized for economic growth and against poverty (Abramovay and Sachs, 1996). In this case, even if destitution strikes in these regions more violently than in our country, the road map with which the poor can join and benefit from the market economy can be drawn with some clarity. It is no coincidence that there is consensus among the international specialists working in these regions on two central points:
· the potential output of the rural poor, if put to good use, may be the basis for a fairer agricultural development.2
· the productive possibilities that the green revolution opens for the regions which until now have not been considered very suitable for agricultural development.3
The fact that the poverty in these regions is found in the rural environment is perhaps a trump card rather than a handicap. In these cases, it seems possible that agricultural development (given that it tries to exploit the productive capacities which have been resting up to now) could be the basis for a system integrating growth and fairness. Many rural poor can become more successful as farmers and, in this way, become the key players in the market economy. This is why agriculture is of strategic importance in a perspective of growth with fairness, in particular in sub-Saharan Africa.
b) The situation is quite different in Latin America. Our continent has undergone a massive and rapid process of deruralization without really becoming urbanized. A large percentage of those who left the countryside are now living in 'pre-towns' (Abramovay and Sachs, 1996), without access to the basic conditions that characterize urban life -housing, health care, education, culture and, above all, employment. Most Latin American poverty is no longer in the rural environment (De Janvry and Sadoulet, 1993a:663). Agricultural development is obviously important but, in contrast to what is happening in sub-Saharan Africa, it cannot be the main thrust of a policy aiming to include the poor in economic life as a basis for their social emancipation for the simple reason that most poor people no longer live in the country, nor will they return there.4
THE CONTRADICTORY EFFECTS OF REDUCED PUBLIC INTERVENTION
TODAY, STATE INTERVENTION in agricultural development is declining in all developing countries. In Brazil, the three main forms of support for agriculture between 1970 and 1985 (subsidized credit policies, an undervalued exchange rate and tax subsidies) were eliminated and, globally, structural adjustment policies were fairly successful. The generous subsidies received by the agricultural sector between 1970 and 1985 made a decisive contribution to income and wealth concentration in the rural environment and, thanks to help with mechanization, led to the elimination of precarious land tenure5 and to conflicts over land as a result of the tax incentives, as a result of which urban enterprises monopolized large stretches of land in Amazonia.6
The reduction of state credit to the agricultural sector has not caused production to fall - far from it. In 1985, for example, when the state made US$ 15 billion available for farmers through the national rural credit system, the cultivated area in Brazil was 42.5 million ha and cereal production was 53.9 tons. Ten years later, state credit had fallen to almost one-third of its previous level and the surface area had been reduced (39 million ha), but the harvest had reached 80 million tons. Agricultural funding is less and less dependent on state funds and this corresponds to a very important change in relation to the model which dominated growth in the sector between 1970 and 1985.
This agricultural dynamism had very positive effects on the success of the stabilization plan set up in Brazil after 1994,7 because it made a significant contribution to the fall in food prices. On the other hand, after agricultural earnings suffered a drastic reduction, a 10 percent drop in the next harvest was forecast. The economic stabilization plan is largely supported by an income transfer that the agriculture sector has worked to the benefit of society as a whole and, above all, the poorest section of the population where food is the largest item in the family budget. I think it is important to note, during our workshop's discussions, that as a result of the fall in food prices, agriculture has made an important contribution to beginning to fill the development gap. Despite the widely held view in Latin America, the reduction in food prices in Brazil is the result of important technological gains rather than of a so-called levy raised from small producers.
There are two obstacles to maintaining these results.
a) The state tax crisis means the state is no longer able to finance and support the sector in times of overproduction.
b) The policy of overvaluing the exchange rate and opening up to trade threatens the positive performance of the agriculture sector. Today Brazil is second only to China in wheat production. Production fell from 6.1 million tons in 1987 to 1.6 million tons in 1995. In 1996, the country will have to spend more than US$ 1 000 million on wheat imports alone, amounting to 7 million tons. Brazil used to be a great cotton exporter but now imports 500 000 tons of this product valued at US$ 700 million. These imports are attractive for industry because of the domestic policy of high interest rates.8 Maize production will be less than consumption by 5 million tons and if massive imports are not planned, it is because the government has large stocks.
The recent growth in Brazilian agriculture has had undeniably positive repercussions on distribution. It remains to be seen if this performance will last in a situation where the state is less and less capable of managing income stabilization policies on the one hand and opening up trade on the other.
THE IMPORTANCE TODAY OF THE TRADITION OF LARGE ESTATES
RECENT AGRICULTURAL DEVELOPMENT IN Latin America is characterized by what Johnston and Kilby (1975) called bi-modalism. While in the central capitalist countries, agricultural progress is organized around the family unit, in Brazil ownership of large areas of land has had a decisive influence on the whole of social life as was already pointed out by José Medina Echavarría in 1954.9 It should not be forgotten, to borrow the expression from Enzo Faletto (1988), that the hacienda was the basis of a culture and, in particular, of a political culture. It is in this sense that the "modernization of the great landed estates," an expression which has become very common in Latin America, even if it is true from the economic point of view in several circumstances, seems unsuitable if we examine the more general effects of development based on these units of great territorial extension.
This does not mean, however, that we can speak of generalized land ownership parasitism in Latin America. In several Latin American regions, the famous inverse relationship (according to which land use would tend to decrease as land area increased) no longer holds true. The large properties have very clearly intensified agricultural activity.10 One of the main consequences of bi-modalism is that the weight of non-family farms in agricultural supply is generally greater. Before starting to talk about agrarian reform, it must be stressed that, in contrast to Asiatic experience, Latin American agrarian reform cannot aim to end the current bi-modalism.
Land-owning parasitism is not nearly as widespread as it was before the late 1960s, when the theme of agrarian reform was on the agendas of the main international organizations. The statistics are uncertain but in Latin America, once again in contrast with the situation in most of the Asian countries, we still have an unexploited agricultural border zone (not the Amazon forest zones) of which a considerable part is within the very large estates. In these cases, the theme of the inverse relationship is still relevant.
"Rural development should not be based only on land distribution to peasants. it should include technology, research and take into account the knowledge of the rural people."
Ms. ROSA MARIA BARBA P. - MEXICO
The weight of the large properties represents an important limit to the development of civil society, community life and hence to balanced rural development. Many farm workers live in small towns where access to the most elementary means of existence is practically denied. This is a fundamental point for discussion because small and medium-sized towns are often viewed as alternatives to either rural poverty or marginalization in a big city. Leone's important study in Brazil (1995:161) shows that even in the most developed regions (such as the state of São Paulo), living in a town and depending on farm work tends to lead to extremely precarious living conditions. The system of large farms that depend on the work of salaried temporary workers causes uprooting and therefore is in opposition to the creation of an active social and cultural life which any rural development policy should foster.11 In other words, the development of the system of salaried temporary workers on large farms is not the way to help poor people increase their opportunities to participate in the market economy.
Rural poverty and agrarian reform
What sense is there in agrarian reform in these countries which, despite the poverty of their rural population, have dynamic agricultural sectors, are able to assimilate technical innovations and are highly integrated into national and international markets? Until now, agrarian reforms have been successful in those countries and regions where rural poverty and agricultural stagnation could be seen as the same problem.12 This is particularly the case for the most successful agrarian reforms, those of Japan, Korea and Taiwan,13 where it has been possible to achieve agricultural growth and the integration of the poor into the economic system in one step. The development of the productive forces and the fight against poverty could be seen as one and the same challenge.
Latin America has lost its historic opportunity (which several Asiatic states have put to good use) to make agricultural modernization an instrument to integrate the poor into the dynamism of the market economy and, as a result, construct the bases of their economic and social emancipation. In this sense, growth has been disorganized, but it has not been blocked.
In these situations, the economic sense of the changes represented by agrarian reform tends to be in doubt. This is what is happening in Brazil and in Latin America in general, and in South Africa (Lipton and Lipton, 1993) in particular, where agrarian reform is often seen either as a useless expense or, at most, as a purely social policy whose economic sense is simply that of waiting for the imminent urbanization to be completed in order to carry out its work of assimilation.
But it is important to discuss certain proposals about the sense of agrarian reform in today's situation.
a) Agrarian reform is not a panacea that will resolve the social problems of a region that has urbanized rapidly and has a population that is now three-fourths urban. However, it is still the only lasting way to address the problem of rural poverty and can have permanent effects on how the poor are introduced into the economic system. This is different from other social programmes, such as public work approaches or food distribution which are important in attenuating extreme poverty but are incapable of changing the matrix of income distribution.
b) Agrarian reform must be clearly targeted in two ways:
It must be concentrated in the poorest rural regions. In Brazil this means mainly the northeast. The recent formation of scattered assentamentos (the settling of farmers under agrarian reform programmes) in the Southern region produced very good economic results,14 a fact which is recognized even by opponents of agrarian reform (Castro, 1992). However, in the northeast, the practice of introducing these scattered assentamentos, i.e. not on a large scale nor in a selective way, produces mediocre results.
The explanation of this contrast is simple -in southern Brazil, the socio-economic conditions permit the development of family agriculture (roads, banks, cooperatives, competitive markets, and basic social infrastructure), while in the northeast, the new farmers fall prey to the traditional ways of obtaining credit and gaining access to the market which impedes their success. Therefore, agrarian reform must be limited regionally, but it should be on a large enough scale to change the socio-economic environment and, as a result, the relationship of the farmer with all the institutions that define his entry into society.
I recently visited an assentamento in the state of Paraïba (in northeast Brazil) where the farmers were happy and proud of their productive performance. When I asked them about their children's education, I learned that the schoolmistress received one-fourth of the minimum salary each month and so she did not give any lessons. It is clear that if this assentamento were not isolated in this unproductive regional ocean of great estates, but inserted into a socially-significant experience, the bases would have been created immediately to change the relationship between the farmers and the public and private institutions.
It must also be targeted from a time angle. The practice of creating scattered assentamentos must be replaced by a vast programme to improve the rural environment in the poorest regions and to put an end to structures which allow patronage and personal dependency links with the great landowners.
c) In the regions which suffer from both extreme rural poverty and landowning concentration and absenteeism, alternative mechanisms to agrarian reform (land tax, land funds and the rental market, itself a land market) are unable to fulfil the distributive role which one might expect. De Janvry and Sadoulet (1993b:267) show that in Asia the land rental market can work, precisely because the structure of large estates was first broken up by agrarian reform, in contrast to what happens in our country. In their opinion however, this is a road to be exploited, despite the lack of tradition. In relation to those regions where the weight of family farming is important, they are surely right. However, in relation to those regions with the typical large estates, I admit to some scepticism in this regard, which a recent study of Carter and Galeano (1995) seems to confirm.
Family agriculture and civil society
IN SEVERAL LATIN AMERICAN REGIONS, agrarian reform is not (or is no longer) on the agenda. This is particularly the case for areas where economics and social environment have allowed family farming to incorporate the material means for technical development and participation in growth. These are generally regions where the social indicators show a much more balanced situation than those where the large estates dominate. In the south of Brazil, for example - in the regions which were not dominated by colonial plantations and slave labour - the social, territorial and economic weight of family agriculture is very important (in some regions of the states of Santa Catarina and Paraná, it is even predominant) and I think that the questions posed by this sector are crucial for the creation of new paradigms for rural development.
In these regions, some of the most dynamic sectors of Brazilian agriculture are dominated by family farms. This is the case for poultry and pig farms, tobacco production and often even for cereal production.
Two frequent misunderstandings must be avoided when examining family farming within the balanced rural development.
a) Family farming and small-scale production are not synonomous. Several Latin American regions have recently witnessed the formation of a sector of family farmers integrated into competitive markets for produce and credit who are looking for long-term technological innovation and who are not averse to taking risks; in short, their way of life is moving away from what might be defined as a 'peasant economy'.15 In contrast with an entire intellectual tradition in Latin America, one could say that these family farmers are fully integrated into the operational mechanisms of the capitalist economy. They are not 'resistance fighters' destined to disappear.16
b) The differences within family farming itself need to be recognized. Between the farmers who find themselves in a situation of extreme poverty - and whose material reproduction depends less and less on agricultural work done on the farm - and the relatively stable family farmers, there is a vast intermediate class whose size cannot be ignored. It is most important for rural development policies in Latin America to be directed toward this intermediate group. In addition to settling new farmers, it is also important to make their activities viable and create the conditions for formerly-settled farmers to make use of their existing productive abilities to help themselves and society.
A team of Brazilian researchers is currently working on a FAO project to quantify the economic and social weight and the different classes of family farmers, the agrarian systems which characterize them and the rural development policy proposals which could help strengthen them.
"Es la ejecución de una serie de acciones tendientes al mejoramiento de las condiciones de vida de la población en sus diferentes aspectos: salud, educación, comunicación agricola, etc."
MR. GERMAN ANTONIO FLORES
This FAO work should be placed in a context for observing a change in the relationship between Brazilian society and family agriculture. Around this change, one can see some of the new rural development questions.
a) Intellectually, since the beginning of the 1990s, family farming has been a noble subject on the agendas of the most important research institutions in Brazil. L'EMBRAPA (the Brazilian enterprise for agricultural research) has established a work programme on this subject. Researchers are approaching the subject with new methods (studies of the agrarian systems which, in Brazil, were not very widespread), in search of new data (quantifying family farming on the basis of income levels and not by surface area) and on new questions (part-time agriculture).
b) Socially, this sector of family farmers in the south of Brazil is beginning to represent an important force within the union movement and is linked to several non-governmental organizations. The themes they are working on are doubly new.· They are increasing their knowledge of the mechanisms of agricultural policy management, international trade, credit, and markets, subjects that until recently had nothing to do with the movements of rural workers. This is understandable because a union movement culture is created in the struggle for land and the struggle for employees' rights and on those themes which pertain to the "emarginated". It is only recently that themes dealing with agricultural policy and the working of the market have become important to them. It is important to underline that the appearance of these "new themes" has not meant opposition to the "traditional themes" of the rural workers' movement (the struggle for land, for better salaries, etc.), nor to the movements which represent them (above all the Movement for Rural Workers with no Land). Most of the new generation of union officials linked to specific questions of strengthening family agriculture belong to the group of leftist union organizations (Sole Workers Organization).
· They raise new questions which do not have aspects of immediate protest, for example questions concerning women and the young. The Women's Commission of the Sole Workers' Organization has just edited a didactic work on the construction of new relationships in family farming that calls for reflection on relationships within milk, maize and medicinal plant production (CUT, 1995). Also, the above- mentioned FAO team noted that the most recent rural exodus, at least in the regions where family farming has a significant weight, mainly affects young people. This poses very serious succession problems although I have found no university research on this problem in Brazil. However, this is a subject which provokes increasing concern in the social movements, as it questions the ability of family farming to reproduce itself. This theme deserves much more attention from the researchers and international organizations dealing with rural development.
c) Politically, in October 1995, the Brazilian government launched a national programme to reinforce family farming and declared that all efforts and resources of agricultural policy must be directed towards this sector of society. The success of this programme, in a country where the force of the large estates is known and where until now family farmers have had no influence on agricultural policy decisions, is by no means guaranteed. The important point is that it has allowed discussion of certain basic themes concerning agricultural policy, rural development policy and land policy itself, including the following:· the reinforcement of family farming may be one of the bases for decentralizing agricultural policy. We have already seen the decline of the model for funding agriculture which is centralized in the federal state. The appearance of credit cooperatives independent of the banking system shows considerable potential for agricultural funding to be based on local savings, even if only in a small way. Another important experience in this sense is the state of Santa Catarina in southern Brazil, where in one-half the municipalities, the local administration organizes "rotating funds" for agricultural financing on the basis of municipal finances. These funds are created by farmers who pay for the public services they use, such as opening and maintaining of roads. The procedure for the creation of these funds is simple and does not require a municipal law (Gasques, Villa Verde, 1995:28). It is in contrast to the dominant trend in Latin America which Ortega (1992:144) called under-municipalization. Nevertheless, the basis for this intervention on the part of municipal public power is the existence of a populated rural environment where farmers can take responsibility for own their destiny.
· It is also in the state of Santa Catarina that the discussion on the forms of access to land other than by agrarian reform is making the most progress. In 1983, the state of Santa Catarina established a land fund that buys lots on the market and then sells them to farmers with no land at prices they can afford. Between 1983 and 1995, this fund settled 2134 farmers, of whom 83 percent previously had rented land. In 1994, the FAO team working on this theme proposed the creation of a mechanism to regulate the development of land structures in the regions where family farming dominates. In these regions, self-employed professionals who live in towns often buy land from farmers in difficulty or from aged farmers. These sales should not be prevented, but since these purchasers are not farmers, it is a loss for the rural communities. This is why the FAO team (FAO/INCRA Conference, 1994) proposes setting up Land Organization Companies with pre-emptive rights on operations involving the buying and selling of land. This company (which would not belong to the state) could, in certain circumstances, buy a property (at the price offered by the original buyer) and hand it over to young farmers who would repay the cost on the basis of a farming plan.
I was myself invited to discuss this theme at the Santa Catarina Agriculture Secretariat. The state authorities were worried by the prospect of a rural exodus involving young people and the destructive effect on rural communities of the systematic buying of lands by people who were not going to live on them (doctors, lawyers, etc.). Here again, this discussion is only possible thanks to the force of family farmers; it would be impossible in a zone dominated by large estates.
THE ROLE OF AGRICULTURE IN THE CREATION of a development model where economic growth is the main factor of integration into social life is objectively limited in Latin America by the phenomenon of de-ruralization. In this sense, agriculture's contribution to distribution lies in its capacity to supply food to the whole of society in abundant quantities and at decreasing real prices. The concentration and parasitic nature of the large estates in Latin America (at least in Brazil in recent times) has not prevented agriculture from fulfilling these social and economic functions, despite the destructive effects of the great landowners' power on social organization in the rural environment.
The social effect of agrarian reform today will not be the same as when most of the population lived in the rural environment. However, it is no less important as a means of combatting rural poverty. It is the main condition for the rural poor to apply pressure to gain access to modern social institutions such as public health, education services, credit, competitive markets, transport and infrastructure. In this sense, agrarian reform must be localized, but concentrated in space and time, so that it can help the poor onto the road of constructive participation in the market economy.
However, rural development policy cannot be reduced to agrarian reform. It can be one of the bases for unifying the rural environment and civil society, which most of the time are held to be contradictory in the minds of Latin Americans. Family farming enjoys social and economic importance in regions where the most topical development themes are beginning to be discussed (the role of women and the young). It is also from these regions that initiatives are forthcoming (credit cooperatives, municipal credit) which may represent a way to decentralize at least one part of agricultural policy itself.
1. The subject and this expression (ndt. the original expression was 'el casillero vacío' which literally means 'the empty pigeonhole') form part of the doctrinal corpus of the Economic Commission for Latin America and the Caribbean-ECLAC. See in particular ECLAC, 1990.
2. The economic activities of the poor may be one of the essential bases for reducing poverty. The work of IFAD shows that a new development paradigm is forming around this idea (Jazairy et al., 1992:14), the economic justification of which can be summed up as follows: the gap between the potential and effective productivity of the rural poor is much wider than it is for the non-poor.
3. The most important recent contribution, in this sense, comes from the basic work of the CGIAR (1994:42) which noted that the recent association of ecology and the social sciences opens the door to new methods and -more importantly - to new attitudes to involve the farmers themselves in analyzing their farming systems and their ways of life.
4. Although in a recent survey in the Campina municipality (one of the main technological centres in Latin America) 24.8 percent of inhabitants said they were ready to leave the town and to work and live in the country if they would benefit under an agrarian reform plan (ABRA, 1995).
5. Even if they show - correctly - the socially positive effects of technological development in agriculture, Binswanger and von Braun (1993:181) cite several cases where state subsidies have made access to mechanical technology artificially cheap thus causing the elimination of tenant farmers in Pakistan, Sudan and Ethiopia.
6. In Amazonia, the area held by large enterprises based in the state of São Paulo is greater than the rural area of the state of São Paulo itself.
7. The 'plan real' led to the country's annual inflation rate falling from 2 300 percent in 1993, to less than 40 percent in 1995. The plan rests on three pillars: opening up to trade, overvaluing the exchange rate and raising bank interest rates with two objectives: to curb economic activity (and hence the threat of inflation racing ahead again) and to attract variable capital which today accounts for at least two-thirds of the US$ 50 billion in currency which the country holds in reserves.
8. The interest rate policy surely represents one of the most perverse aspects of the economic stabilization plan. Coupled with the opening up of trade, this causes serious deadlocks, as in the case of cotton where imports are paid for on the basis of annual interest rates which are almost 18 percent per year and payment terms of 360 days. Payment under the national financial system for products purchased on the domestic market must be made in 60 days on the basis of a monthly interest rate of 10 percent. (Saes and Braga, 1996:20).
9. The social structure in Latin America has for many years presented the hacienda format in different ways. The entire economic, social and political history of the region is largely the history of the establishment and transformation of this economic and social unit. The weakening of the traditional structures in Latin America is clouded by the slow disappearance of this old organization - a slow disappearance but not extinction since we can still observe its presence and its influence (Echavarría, 1954, Chonchol, 1994).
10. It seems interesting to me to discuss the proposition of Michael Lipton (1993:648) who said that the inverse relationship does not apply to all agricultural production, among all the other activities, in function of the factor costs. Wanting to enforce the principles of family farming on the mechanized production and harvesting practised in Russia today would be just as foolishly ineffective as was Stalin's enforced collectivization, although less damaging and disgusting from a human point of view. Family farming persists from Montana to Burgundy via Poland. Nevertheless, the efficiency and the persistence of large farms is not an illusion.
11. The employer's system is losing its traditional attributes and power but these historic political and social functions are not being replaced by any other institution - the void created by this situation in the rural environment is not being filled by the state, nor by civil society (Ortega, 1992:144).
12. Poverty in rural regions, combined with production which is stagnant or deteriorating, constitute a single problem tied to the very low productivity of a large part of the agricultural workforce, particularly as regards food production (El-Ghonemy, 1990:17).
13. Binswanger and Deininger (1993:1469) collect the most important evidence in this sense. They say that agrarian reform in Japan and Taiwan is associated with a growth in investment, a rapid adoption of technological innovations and an increase in the use of family workers. In Taiwan between 1953 and 1960, the annual increase in the production and consumption of inputs was of 23 percent and 11 percent respectively. In Japan, the productivity of work and land increased by 5 percent and 4 percent per year respectively between 1954 and 1968. In Korea, under the impact of agrarian reform, agriculture achieved a growth rate of almost 4 percent per year.
14. An FAO survey (FAO/INCRA Conference, 1992) on the national plan shows that in most cases, the farmers settled under agrarian reform programmes have higher incomes than they could have earned in any other sector of the labour market to which they had access. Nevertheless, the work shows that in the region with the highest concentration of rural poverty, the economic results of agrarian reform are mediocre. This work also shows that it is less costly to place a family in an agrarian reform programme than to create a job in a sector such as civil building works. (FAO/INCRA Conference, 1992).
15. The definition supplied by Ellis (1988) in his indispensable work, seems to me to be the most complete even from a sociological angle. In his opinion, peasants are the family producers who are only partially introduced into incomplete markets.
16. For more details and a theoretical summing up on this theme, see Abramavoy, 1992.
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SABINE MANIGAT is a member of the Technical Secretariat of the National Agrarian Reform Institute (INARA), Port-au-Prince, Haiti.
Haiti shares certain characteristics with the rest of the Caribbean region, but the outcome of its colonial links with France has made it unique.
Known as the most prosperous sugar island during the eighteenth century, the once-French portion of the Hispaniola island underwent a revolutionary process from 1791 to 1804, which led to a unique type of independence. The slaves themselves defeated the colonial power and took control of the land, ejecting or killing the Creole planters of French origin. Although it shares features with other Caribbean societies that came from historical plantation economies, such as Cuba, the Dominican Republic, and the French islands of Martinique and Guadeloupe, the current Haitian economy has been largely determined by a constant and successful denial, by that newly-freed population, of any economic form of large land exploitation.
During the nineteenth century and the beginning of the twentieth century, most Caribbean economies also dealt with such resistance but large landowners usually solved the problem with immigration policies and combinations of peasant and plantation-type use of the land. In contrast, Haiti undertook a peculiar process in which the population progressively occupied the land abandoned by the colonialists. The new dominant groups controlled the army, the largest and most prosperous plantations and the state, while colonizing the surrounding hillsides and remaining plots of land. The impossibility of providing the plantations with sufficient labour force led to the progressive subdivision of large estates into smaller rental plots. Sporadic and legally-uncertain land donations or selling by the state, further contributed to the present situation, which can be characterized as the result of a frustrated transformation from plantation to peasant economy.
The landscape presents a picture of a peasant agriculture largely dominated by small plots, usually no larger than one-half ha, covering roughly one-third of the countries 27 000 km2. The average population density for the whole country is estimated at 215 inhabitants per 2575 km2 on cultivable land. The plains, only four of them of sizable dimensions, contain approximately 170 000 ha, including the most profitable portion of cultivable land and a number of large plots. The greatest number of rural farmers and the most cultivated land are located on the hillsides.
Thus, Haiti has been defined generally as a country of small peasant economy with virtually no large landowner problem. The reality, however, is quite different from this first superficial glance at the land question. It is true that Haiti has long had what can be defined as a peasant economy, in the sense that the peasant family was the dominant economic and social unit, and the backbone of the national economy. But this picture hides a far more complex situation, as the patterns of land occupation combine typical land exploitation in small plots with a land tenure situation that is largely unknown.
There are no reliable figures on the number and actual extension of properties, since the country lacks a national registration of properties, and land transactions were never centralized, reliable nor exhaustive. Furthermore, legislation and historical practices have consolidated specific patterns of ownership ranging from indivision to certain collective forms of properties within the lakou or rural community. Chaotic and/or fraudulent rent and selling of state-owned lands only adds to the confusion and makes it virtually impossible to determine the exact state of land ownership at a national level. Finally, it must also be stressed that the last reliable national census was in 1971, with statistical projections until 1982.
Within this general state of non-existent figures on the country and its economy, the estimated situation at the end of the 1980s was the following.
· Rural population: 3.5 million
· Cultivated land: 870 000 ha
· Environment situation: 90 percent deforestation
· Main crops: coffee, rice, corn, cacao
· Agricultural production in the GNP: 40 percent approximately
· Per capita national income: US$ 350
· Rural income: less than US$ 250
The state policy toward the agricultural sector has traditionally been one of taxation on production and export, rent of the state-owned lands and other perceptions on the market. The role of the Ministry of Agriculture has been limited to some rural development initiatives in terms of irrigation infrastructure in the largest plains and some agricultural credit institutions, mainly available for relatively prosperous farmers and commercial intermediaries. With the important exception of the Artibonite Region, always favoured for its strategic production of cereal (mainly rice), the state has shown no interest in getting involved in rural production regulation. A striking indication of this general indifference of the state toward the evolution of the agricultural sector is the scarcity of laws passed during the 1980s on the matter. Only nine were passed, mainly dealing with general territorial administrative matters, with four of them dedicated to the protection of forests. The only legislation from chat period that directly concerned the land tenure issue was a 1989 law disposing the registration of state-owned land for distribution to needy peasant families. It apparently had no serious application or impact.
"C'est la citoyenneté à la campagne, c'est la ville enrichie et dynamisée par la contribution économique et culturelle qui vient du monde rural."
MR. RICARDO ABRAMOVAY - BRAZIL
Recent political and economic developments
CHANGES OF GOVERNMENTS, NEW LEGISLATION
HAITI IS KNOWN FOR ITS REMARKABLE instability, marked by a 10-year political crisis, following the overthrow of the 30-year Duvalier dictatorship. After six governments, several aborted electoral processes and continuous social upheaval motivated by a national cry for change, a new government was elected democratically, for the first time in the history of the country, in December, 1990. This government, led by Jean Berthrand Aristide, lasted only seven months before being overthrown by a military coup which interrupted the democratic experience for a period of three years. Aristide returned to power with the support of the international community for 13 months, mostly dedicated to the organization of general elections at all levels. The context of this lack of time and stability which made it impossible to implement and accumulate new practices, must be kept in mind when evaluating the present situation and perspectives.
From the first, blink-short period of the Aristide government, the rural sector only benefited from two measures which then were reverted or aborted by the military coup - the abolition of the rural police, an instrument of social control also devoted to systematic economic and political abuse on the peasantry (the rural police was reinstated by the military during the three years of dictatorship, from October 1991 until October 1994), and the preparation of a law creating the Institute for Agrarian Reform (INARA).
During the three years of military regime, the economy in general, and the rural sector specifically, suffered severe deterioration with massive repression leading to equally important migrations, both towards the main cities and abroad. It is estimated that the "boat people" modality of clandestine emigration affected several hundred thousand people. Agricultural production dropped an estimated 30 percent.
After the return of the legitimate government, INARA was finally created by a presidential decree, on April 29, 1995, and its director general installed at the end of July. Another important institutional step favouring the rural sector has been the creation of a new Ministry of Environment.
NEW POLICIES, INSTITUTIONAL REFORMS, STRUCTURAL ADJUSTMENT
THERE IS A GENERAL PANORAMA OF indefinition at the macroeconomic level caused by tensions between long-awaited political measures chat prioritize production and improvement of the land situation, and the actual economic emergency measures designed to face the crisis, such as the increase in food import (especially rice). Key options concerning the strategy to regenerate the exhausted economy remain to be taken. They will affect the future of the rural sector. For now, the overview is one of fragmented and somewhat disordered initiatives, scarcely referred to or controlled by the state.
During this last 16-month period, a number of empirical regional policies, based on largely uncoordinated initiatives of foreign origin, have developed.
Different NGOs and international organizations are combining rural development oriented strategies with food distribution and labour intensive projects. The long-term actual improvements for the peasants are not clear, as these initiatives tend to have more appeal to the ill-equipped farmers than the cultivation of their exhausted plots. Since these actions seldom consider assistance in terms of investment or infrastructure improvements, the peasants are tempted to abandon cultivation.
In the Northern Plain and the Artibonite Valley, farmers' organizations are being revitalized. This process does not always develop peacefully, as the economic crisis affects the countryside and conflicts for land are exacerbated by the prospect of land reform and improvements in the agricultural infrastructure. Tensions are mounting mainly in these two important valley regions. In the southern departments, activities of reforestation and land protection are being implemented by the World Bank and supported by other institutions.
For its part, the state is undergoing a vast process of institutional reforms, which include the whole national governmental structure, particularly the Ministries of Finance, Agriculture and Commerce, and the General Direction of Taxation (DGI). These reforms have several goals.
· Reorganize the role of the state in the general economic frame.
· Modify the structure and the responsibilities of the Ministry of Agriculture.
"Rural development may be seen as a process by which the rural population (economically, socially and politically deprived) gradually gains access to productive resources (which allow them to improve their standards of living), and to greater participation in the policy-making process on issues that have a direct/indirect impact on their lives."
MR. JAVIER MOLINA CRUZ - EL SALVADOR/NICARAGUA
This requires some explanation in the context of this paper. Two different visions appear to be competing at the moment. One favours decentralization and dis-involvement of the state in direct productive activities, limiting the role of the Ministry to one of supervision, administration of resource allocation and general policy design. In accordance with this first vision, important changes were undertaken within the Ministry, with transfer of responsibilities and field interventions to decentralized institutions and/or NGOs, and the promotion of new entities such as Chambers of Agriculture in the Northern Department, with the participation of the different stakeholders in the field. This view prevailed through November, 1995, when a change of government promoted a new team with a different opinion on the matter. Presently the trend seems oriented toward a reaffirmation of the role of the state in the sector, because of the needs to coordinate the multiple initiatives mentioned above, and to define clear priorities for a key sector of the economy.
· Change the taxation system, in order to improve its performance in a country where taxation has always been oriented toward agricultural production and indirect taxes. It is quite relevant that, with a general trend toward liberalization of taxes in the international economy, there is a recognized need, supported by international financial institutions, to reinforce the taxation system in Haiti, particularly in the more prosperous industrial and commercial sectors.
· Decentralize the tax system, including the one concerning the state-owned lands, and place it under the responsibility of the local governments and municipalities in accordance with the Constitution of 1987.
Structural adjustment measures remain an unsolved issue. In July 1994, the matter was discussed by the national government and the international financial institutions, prior to the return to power of the former. However, the evolution of the national economy, submerged in an acute financial and economic crisis, made the implementation of the agreed dispositions impossible, and discussions are still underway. Meanwhile, the structural adjustment programme which appeared to be conditioning international funding for the Haitian economic recovery has been put aside temporarily.
The present political scene, and the agricultural scene specifically, are being revived by the same protagonists of the struggle for change which started in February 1986. Only now, the aspiration of the majority and the political leaders of these struggles are occupying positions of power. Therefore, popular organizations, particularly peasant organizations, tend to be at the front. A number of these organizations are represented in the Parliament and some have a strong presence in political parties. Land claims arise in the Central and the Artibonite departments namely, but rural unrest has not generally led to violent outbreaks. On the contrary, there is much discussion about intervention on the land question and the problem of an agrarian reform. In accordance with this, one of the first initiatives of the newly-created INARA was the organization, in November 1995, of a national workshop on the issue of a national agrarian reform, sponsored by the World Bank and the Inter-American Development Bank (IDB). A moderate but representative participation of peasant organizations was acknowledged. This workshop was the first in a series of other meetings that took place at regional and local levels during 1996.
The active presence of NGOs in the countryside also encourages new participants, but, as we stated above, their impact is difficult to analyze at present.
Impact of recent changes
SINCE THE CHANGES HAVE BEEN FEW and are still being discussed and planned, their impact cannot be analyzed as such. However, it is possible to sense certain transformations in the dynamics of the civil society.
At the political level, recent global changes have had a strong impact mainly on popular mobilization and demands. Four months of electoral process, almost uninterrupted, and two governmental changes within a year, are largely responsible for Haiti's state of permanent unrest during 1995. However, the fundamental structures for democratic participation have been organized or are being shaped. Among them the following two can be mentioned.
· The process of establishing Territorial Assemblies, a constitutional feature not implemented since the vote of the Constitution in 1987, which is meant to ensure grass root participation. The first elements of these assemblies, the Administrative Councils of the Communal Sections (CASEC), were elected in June and September of 1995. The remaining personnel will be chosen after the vote of the corresponding law, presently under discussion in the Parliament.
· The creation of a Ministry for Haitians Residing Abroad, aimed at informing these citizens or former citizens, who have deep roots in the country, of Haiti's economic, social and cultural needs, in order to encourage investments from them. Since the problems of refugees and returnees are being dealt with by the Ministry for Foreign Affairs, the possibility of integrating the two Ministries is currently under examination. The problem of refugees and returnees, often on a forced basis, has been a serious issue since the return of the democratic government. Several countries who had received Haitian boat people on an emergency basis during the three years of dictatorship and international embargo, started to apply a systematic policy of forced return. These returnees came from the United States, the Bahamas, the French Caribbean territories and the Dominican Republic. Haiti's economic situation made it virtually impossible for these people to be massively re-integrated, and negotiations were undertaken by the Haitian government to avoid a state of crisis on the matter. Currently, the situation is one of sporadic contingents of returnees being repatriated under circumstances sometimes insecure, which has led to several incidents with loss of lives. The recent integration of Haiti in the International Organization for Migrations will certainly help to deal with this problem in a more convenient manner.
It must be noted that the overall national economic impact of the Haitians abroad, mainly in the form of remittances sent back to their families, has always been important. It accounted for currency entries of approximately US$ 600 million during the 1980s, and is currently estimated around US$ 500 million.
"Enfrentar el problema de la debilidad institucional y, a partir del fortalecimiento de los actores del desarrollo rural, llenar los vacíos institucionales y pasar del apoyo puntual a las estrategias de sobrevivienza que ha prevalecido hasta ahora hacia una política de creación de actividades productivas y rentables en el campo, sobre la base de un lazo fuerte y regional entre Estado y campesinos."
MR. RAFAEL PANIAGUA - MEXICO
The impact on agrarian structure remains to be seen, as the new institutions are very recent or still being built. However, one can perceive a dynamic trend in the countryside. While poverty and rural-urban migration tend to deepen and overload the already crowded urban regions, particularly those of the North (Cap-Haitien), the Artibonite (Gonaives) and the state capital, Port-au-Prince, community and peasant organizations are taking steps toward greater participation.
One specific example is the Organization of Small Planters in the Northern Valley, supported by municipal governments that have also organized a Mayors' Association. They have elaborated and promoted a regional plan of integrated rural development which includes acquisition of state-owned land (one of the largest proprietors in the region), irrigation, reforestation and new export-oriented crops. The proposal is being examined by the Ministries of Agriculture and of Cooperation, and INARA for national and international financial support. This has led to the choice of the north as the first area for a pilot experiment of land reform, leaving land ownership fundamentally unchanged. As stated earlier, because there is no reliable information at a national level on the land tenure situation, this experiment seeks to provide partial but valuable information on the conditions to be met and the means to be ensured, in order to realize a successful intervention on the land issue, at least in the context of state-owned land.
Traditionally, access to land and the land market generally have been obstructed by two situations. One comes from the legislation and jurisprudence related to inheritance, the Bien Rural de Famille (family property donated by the state and therefore unalienable), land titles registration and other legal matters. Successive contradictory measures taken by the state and confusion in the roles of the different intervening institutions and professionals (lawyers, notaries, the state) only add to the chaotic situation. The other main problem is the widespread corruption and malpractice in land transfers and sale, registration of both state-owned and private land, and the total opacity of the market. These problems led to virtual anarchy in land ownership and several conflicts in the last decade, and created the present situation that sometimes degenerates into outright armed confrontations and massacres.
We will complete the general presentation of this critical situation with two approximate figures of its economic impact on the agricultural sector. The share of agricultural production, in GNP, is now down to 40 percent. Figures on rural income distribution are not available, but several financial institutions (World Bank, IDB, USAID) have estimated that more than 70 percent of the rural population survives today below the poverty level.
As for the social impact, the general crisis situation aggravated by three years of political repression and economic embargo have exacerbated the migration processes referred to above. Additionally, the social situation in the countryside is potentially explosive, due to speculation about the ability of the transformations taking place to have any real affect on the status quo, given the temporarily weakened governmental frame and its scarce capacity of short-term intervention.
Gender does not play a particular role in the new situation, although women, who are traditionally less prone to migration then men, are increasingly affected by this process.
Outlook, Opportunities and Challenges
THE IMMEDIATE FUTURE OF THE LAND question in Haiti is clearly dominated by challenges. There is a clear and urgent need for accurate and reliable information at the national level. No serious and coordinated action can be undertaken without the production of figures on land tenure and agricultural, economic and human resources. Research is underway at regional level, prioritizing the most important agricultural regions. A study is being made of land exploitation and ownership in the Artibonite by the National Office of the Cadastre (ONACA), with the support of IDB and a German NGO. FAO is financing, with the contribution also of IDB and the French Cooperation Mission, research on the main aspects of the issue that should produce the basis for a nationwide intervention of INARA.
Mounting tensions have led to conflicts, so far localized mainly in the Artibonite Valley. These conflicts require immediate state intervention, as they show that population pressure on the land and strong economic interests linked to food shortage are encouraging rivalries among owners, and between owners and farmers, for control of the main cereal production zone in the country. A strategy of conflict management is being tried in the region by INARA, backed-up by similar initiatives of the joint UN/OAS International Civilian Mission for Human Rights.
The issue of income generation can only be dealt with at a state level as it requires strong political decisions affecting the taxation system, and the building of infrastructure and markets for both land and production. The latter involves the elimination of a chain of parasitic intermediaries. The priority claimed by the present regime for the agricultural sector must be demonstrated, as well as the option for decentralization, which has also been one of the regime's recurring themes. It is too early to predict the exact direction these choices will guide the country or how they will eventually materialize. The presidential decree creating INARA defines the mandate of the institution as: To ensure to the best extent basic food security of the country; to provide effective attention to the peasant family's material situation and income, and to preserve the environment.
Indeed, there is potential for the development and use of social capital. Deeply-rooted community traditions, especially in rural Haiti, have not yet evolved into modern economic associations, such as cooperatives, as they have in other countries of the region and the hemisphere. But these practices, based on solidarity and the profound consideration of family, religious or legal links, could give way to the blooming of social capital, if other severe constraints related to an extremely unequal distribution of material and decision-making power do not overwhelm the process.
The main constraints identified do not involve primarily human resources, although they are definitely needed. The most serious obstacles, in our view, involve long-term investment in the sector with information and updating on markets and opportunities, new legislation and the means to enforce it, plus sufficient funds for what already can be considered an expensive policy.
In this context, the privileged approach to agrarian reform and rural development in Haiti is being shaped around the following choices and principles:
· A wide participation in the discussions and analysis of options, involving all stakeholders. This implies not only the farmers, owners and the state, but also others such as NGOs, provided that they are given adequate guidance to improve the efficiency of their initiatives and, by the same token, reinforce their roles as potential decentralization agents.
· Clear priorities that should first consider the combination of macroeconomic choices with the appropriate rural transformation. It is a matter of fundamental political options that will either reverse the present trend of agricultural decay and import-oriented alimentation policy and therefore require expensive and drastic choices to meet the goals defined in the INARA decree and the Constitution itself, or lead to the virtual disappearance of the agricultural sector, maybe reduced to a small competitive and specialized type of production.
· The immediate establishment of conditions for a transparent policy of smooth access to land and water, which will determine the extent to which the goal of secure food supply can be achieved. Fundamental changes should occur in the legislation, mainly in inheritance legislation, the national administration of water as a scarce vital resource, and the classification of the land according to its agricultural or non-agricultural use.
· This in turn will influence the choices regarding the use and adjudication of the land. An example of the vital importance of this matter is the present competition between the proposal of the Small Planters of the Northern Region, referred to above, with another plan, promoted by powerful private investors, for the use of the same portion of land to build an industrial free zone complex. Somewhere along the line of this exemplary alternative lies the future of the Haitian economy and the faith of its agricultural sector.
Rafael Paniagua - Ruiz
RAFAEL PANIAGUA-RUIZ is an international consultant in economic development.
This paper sets out the main issues dealt with in two documents drafted by a mission commissioned by the FAO Rural Development and Agrarian Reform Division in July 1995, with the purpose of proposing a new institutional framework for the design of policies for rural development, agrarian reform and the fight against poverty. The mission was conducted in two stages. In the first stage, it analysed the latest literature on rural development to establish consensus regarding rural development in Latin America and the Caribbean. Consensus was achieved around three major issues: the relationship between macroeconomic policy and sectoral policy, or in more general terms between the global development model and rural development (consensus points 1 to 4); the assessment and refraining of the main sectoral policies relating to prices, credit, agrarian reform and the fight against poverty (consensus points 5 to 8); and the linkages to be promoted between government regulation procedures and the market, including the problem of the reform of the state (consensus points 9 and 10). For reasons of space, the 10 consensus points will merely be stated, without providing any of the underlying arguments in support of them.
To spell out these components, the document takes stock of the present state of Latin American agriculture, and then identifies the scope and the limitations of the guidelines for action that are being currently implemented in Latin America and the Caribbean. In conclusion, it addresses the agents in a new rural development strategy and relations between them.
1. Macroeconomic policy and the global development model set the conceptual and strategic scenario against which to discuss rural development. The various proposals for determining macroeconomic prices seek to provide different models for the structures of the developing countries, particularly with regard to the role of government.
2. The differing effects of macroeconomic policy on different sections of agriculture are the channel through which the global development model sets the scope and limitations of rural development. Every type of agriculture has a specific response capacity to the positive or negative effects of government policy. It is in this general framework of a differentiation between the components of the agriculture sector that the effects of the different macroeconomic policies on the agricultural sector are to be addressed.
3. Production conditions in the agriculture sector have deteriorated so much that a neutral macro-economic policy is no longer sufficient to revive it, and positive discrimination must be practised in favour of agriculture. Structural adjustment policies form the basis of this recovery. Their effects are limited and must be completed through a sectoral policy geared to the new growth conditions.
4. The effects of changing macroeconomic policy cannot happen immediately or automatically. They take time and above all require the explicit support of government. Domestic deregulation and trade liberalization are not in contrast to government intervention, but government intervention is the condition for ensuring their success. Sectoral policy must promote a new relationship with the international economy, which will restore the domestic economy to its rightful place.
5. In view of the structural conditions under which the agriculture sector operates and the asymmetrical procedures for setting industrial and agricultural prices, a specific price-setting policy is required that does not take the form of administrative pricing but provides direct financial support to complement the incomes resulting from price-fixing by market forces.
6. Recognition of the need for an agricultural pricing policy must not side-step the evaluation of the policies being implemented. From the point of view of rural development objectives, the results so far have not been very encouraging. If a pricing policy is necessary, the procedures must change with greater emphasis on income levels.
7. Credit policy is an important area in which the new procedures for government intervention must be implemented. An appropriate credit policy might provide an important complement to pricing and marketing policies. The contribution of informal lenders to rural development must be reappraised. Drawing on their knowledge of the character, personal circumstances and repayment capacity of the small farmers and of the development of the goods and services markets, they can identify the most profitable and safe investment opportunities at a much lower cost and risk than formal institutions. In order to ensure that the sector remains viable in the long term and that agricultural credit functions properly, a rural credit rationale is needed.
8. The problem of rural poverty and measures for reducing it constitute a central issue in rural development. Economic growth and improved conditions for agricultural performance are not sufficient to reduce poverty. Other strategies must also be designed such as migration, the organization of the poor and agrarian reform programmes. Organization is certainly one of the best ways to reduce poverty, to the extent that it produces endogenous innovations that are able to guarantee the survival and the necessary changes required in small farmer agriculture.
9. The linkages between government intervention and market forces are central rural development issues. The polarizing results of the recent experience of government disengagement are clearly a cause of concern. Alternative proposals are needed to articulate the market and government intervention. In order to reconcile these in a new manner, a decentralized institutional system is needed that can identify appropriate instruments for each type of producer, for each commodity and for each microregion, so that an efficient, transparent and differentiated policy can be established. For this reason, state reform is one of the core issues of rural development.
10. Creating a new consensus around rural development must recognize the need for state reform. The participation of government in the development process is vital; the traditional forms this has taken, however, are not. A number of criteria must be respected. First, recognition of the close linkage between rural development and strengthening democracy as a system for expressing particular interests and building up a general interest. Second, the need to design reform that takes account of the globalized international context. Third, the commitment by government and all its social partners to boost specialization in production, technological modernization and creating dynamic comparative advantages. The target of a process of this kind could be the replication in Latin America and the Caribbean of the trends that have been observed in most of the industrialized countries: the increasing industrialization of agriculture, the decreasing specificity of agriculture in terms of other economic sectors, and, in general terms, the application to the rural economy of the laws of the general economy.
Key phenomena in Latin American agriculture
THE FIRST KEY PHENOMENON IN THE PRESENT period in Latin American agriculture is the intense and far-reaching structural adjustment processes, which involves the withdrawal of government from regulating economic activities. The immaturity of the producers' organization or the lack of a long-term view on the part of private enterprise, as a result of a long history of government paternalism and patronage-based policies, is giving rise to a second important phenomenon - the comparatively autonomous functioning of the private sector and small and large producers does not always replace the government efficiently. With governments disengaging and private agents taking their place with difficulty, major institutional vacuums have appeared in the regulation of the agricultural sector as a whole. The third major phenomenon is the (mainly successful) efforts of nongovernmental organizations (NGOs) to fill the gap between the declining public mechanisms for supporting agriculture and the private systems created to organize production and distribution. These three phenomena can be expressed in the following simple statement: Structural adjustment has evidenced a number of institutional vacuums, and the recent history of Latin American agriculture is a particular process for filling these vacuums.
The institutional vacuums can be seen in all the major areas of rural development. With regard to agrarian reform, they relate both to the instruments for guaranteeing and establishing a land ownership and tenure structure (rural cadastral registry, title deeds, registry of property rights) and policies that can keep producers on their lands by opening up opportunities for profitable agricultural production. In addition to a policy to accompany agrarian reform, there is a serious lack of a global re-conceptualization of the process of land redistribution which emphasizes the mechanisms linked to the land market. The specialized public agricultural credit institutions have been a failure, and the private sector has failed to seize opportunities for profitable financing of small producers, while the NGOs are undertaking financing experiences which look promising.
With regard to the type of agriculture that should be promoted, the lack of a global model proposed by the government and the contradictory progress made in the various private agricultural sectors have created the following extreme situations: a family-based agricultural model which cannot be decisively and effectively supported because there is no institutional plan for doing so, and an entrepreneurial agricultural model which is capable of being efficiently incorporated into the international economy, but which cannot objectively be considered a model able to include vast sectors of the agricultural population. The latter gives further impetus to the trend towards an even more unequal distribution of incomes and physical assets.
One final important example of institutional vacuums has to do with the processes of trade liberalization, and the lack of government strategies to support agriculture, and in most cases, the lack of any such strategies by the producers' own organizations to enable them to grasp the opportunities being opened up by sub-regional integration. Instead of being viewed as a development opportunity, this trade liberalization is seen as an obstacle causing some people to question whether the strategy is well-founded at all. The irreversibility of trade liberalization and of deregulation is all the more threatened when the only parties that seem to benefit from it are the large producers who are fully integrated into production and distribution chains according to a regional rationale.
The need to overcome these vacuums by adopting global, consistent strategies based on an inclusive rationale make it necessary to rebuild the relationship between the new government agenda and the modernization capacity of the most dynamic sectors that have long-term interests in the private sector, the producers' organizations, and in the potential for local and clearly-focused intervention on the part of the NGOs. Rural development lies at the intersection of the fields of action of these development agents. Without a new rural development strategy viewed as a process of rewriting the relationship among government, the private sector, producers' organizations and NGOs, filling these institutional vacuums may well result in an incoherent overall process which will generate even more serious problems of greater magnitude than chose which the present situation manages to partially and temporarily resolve.
Rewriting this complex relationship makes it necessary to move through two prior stages. The first is to identify the central issues involved in the present structuring of those development agents: i) agrarian situations, ii) financing mechanisms and iii) fight against poverty. The second stage seeks to establish the role of the various agents of rural development (government, producers' organizations, the private sector, NGOs and international organizations) in rewriting the intersection which stakes out the space for rural development, on the understanding that this intersection will find it difficult to play a positive role unless there is social pressure to steer it, give it momentum and limit its tendency to act for the benefit of the strongest and better-organized parties involved.
Agrarian situations and the stabilization of land ownership
The results of agrarian reforms carried out in Latin America and the Caribbean have proven disappointing. The demand for land and reducing the concentration of ownership remains one of the main components for mobilizing Latin America's small farmers and is an important issue in rural development. It is recognized that a number of new mechanisms are needed to provide land to the landless, as well as more appropriate and effective support.
There are two main reasons for dissatisfaction, which reflect various institutional vacuums: a legal dimension and a production dimension. One problem relating to the legal dimension of land reform has to do with delays in issuing legal title to the land that is distributed, which has led to an apparently reasonable conclusion but has left the whole problem of the unmet demand for land unresolved: the massive land redistribution process is completed, and the priority task now is to give official title to land that has already been distributed. A second problem is the lack of any clear, credible information on the real status of land ownership rights, since there is no rural cadastral registry or land registry that would make it possible to settle disputes and encourage confidence in the structure of land ownership. The third problem is the delay in developing agrarian laws in terms of the development of the agrarian structure itself.
"Process of reorganization of the rural sector, and of re-articulation of its insertion in the national economy, with the objective of economic and social improvement."
Ms. SABINE MANIGAT - HAITI
There are two aspects to this delay: (i) the lack of a national planning system, including programmes for training, decentralization and the participation of the organization; and (ii) most of the institutions dealing with agrarian reform are more than 30 years old, and their design has never been changed. Today there are public institutions that are considered to be inefficient, costly and poorly organized, that are unable to promote small farmer participation.
As far as the production dimension is concerned, when the reasons for the land struggles are analyzed, it is not difficult to see that underlying these struggles is a much more fundamental issue: "pressure on the land is pressure on employment" and hence pressure on incomes. The lack of a social response to the demand for land leads to migration to the large towns and cities and more recently to intermediate towns, which are being used as buffer zones to cushion the pressure that the countryside is exerting on urban growth. Migration appears to be a decisive mechanism for sustaining incomes, and to that extent, for ensuring the reproduction of agrarian systems. Moreover, the lack of land tenure security reduces investment in agriculture and fuels existing tendencies to decapitalize the agricultural sector. This aspect not only affects investment decisions by land-owners but curbs the possibilities open to agriculture to develop dynamically on the basis of land leasing. There cannot be a large-scale agricultural investment process unless ownership rights are clearly established.
New theoretical or practical approaches are being used to satisfy two contradictory needs of land tenure situations: the demand for land from a substantial proportion of small agricultural producers while stabilizing the agrarian system. These new approaches are an attempt to redistribute land while reducing the concentration of land ownership without explosive and traumatic expropriation measures, which in all events are considered counterproductive in terms of the objective of promoting more investment. The World Bank in particular is promoting agrarian reform programmes based on market forces.
These new approaches do not eliminate the need to face the problems that have been analyzed before dealing with the inadequacy of institutions, the lack of information and the need for legal certainty. What is changing is the very concept of agrarian reform. The question to be answered is no longer how to divide a given mass of land among a growing number of applicants, but how to act in order to ensure that the land markets are more efficient and guarantee a flow of land between economically viable supply and demand. Independent of the relevance of these approaches, what needs to be emphasized is that any agrarian reform programme which is not coupled with a global commitment to rural development is bound to create the same sense of frustration as the former programmes. Agrarian reform cannot promote or form part of any rural development rationale unless beneficiaries of the reform are considered full agents of rural development. The stabilization of land ownership is a condition for rural development and requires agricultural activity on the land that has been distributed, sold or leased to be structurally profitable. This presupposes that an agrarian reform programme coupled with rural development must be designed in two stages: solving the legal aspect of the reform by giving a full legal component to the land ownership stabilization process, and integrating the land into the economic dimension of the stabilization of farmers. Agrarian policy cannot be envisaged without rural development, and vice versa.
"El desarrollo rural debería ser ante todo articulado de abajo hacia arriba, como una decisión de los gobiernos locales con la fiscalía de la población rural, donde la reforma agraria es uno de los medios para generar mayores ingresos, pero no es un fin en si misma. Debe ser una estrategia global de desarrollo."
Ms. MARIA CLARA RODRIGUEZ - COLOMBIA
The success of any land tenure reform strategy depends on the type of social pressure on it. The conditions for the positive exploitation of social pressure do not, however, exist in advance. They must be created but there are constraints. The first constraint is enlisting the participation of the beneficiaries. Their participation is decisive because they are the ones who possess the basic information on the situation in the countryside. Yet this participation is hampered because there is a lack of dialogue and confidence between government and the small farmers. The second constraint is the great diversity of situations, making it necessary to take a proximity approach in order to find solutions to each specific problem. The third constraint is government itself. Governments do not understand clearly that agrarian reform can be a lever of rural development. In view of the lack of such a global approach, there is a risk that political concerns may dominate the whole process of agrarian reform. Taken together, these constraints make it difficult to design an ambitious rural development strategy and justify the need to rewrite relations between the various development agents.
The issue of agricultural credit and avenues of action
THE POLICY FOR FINANCING AGRICULTURE is based on a two-fold contradictory need: to reduce and, if possible, eliminate subsidized credit, and to compensate farmers for the stabilization effects of exceptionally high real interest rates. This need becomes all the more acute as a consequence of the trade liberalization of Latin American economies which is creating insolvency because the effects have repercussions on the profitability of the agriculture sector. To deal with these situations a number of interesting alternatives are being suggested to redesign financing policies.
In countries with a strong agri-food industry, a purely private commercial-type financing mechanism has emerged, based essentially on production loans granted by the processing industry. This mechanism has the twin advantage of structuring and consolidating the supply of primary commodities and of providing loans at a low cost, because the agro-industrial complexes have the capacity to obtain external funding at lower interest rates. Another private response to the lack of financing for small producers is to use it as an opportunity for business and for formalizing the main features of the operation of the informal credit markets. Last, an attempt has been made to create a broad area for cooperation between the government as a provider of funds and the NGOs as guarantors of repayment by supervising and providing technical assistance for production. This being so, a number of procedures have been tested under which, for each unit of finance provided by the NGOs, the government provides matching funds several times higher on condition that the NGO takes responsibility for providing technical assistance and for managing the resources. The Consultative Group of the World Bank proposed to support small producers in making their projects commercially bankable through microloans. This programme is based on the principle, justified by the fact that interest rates are high on informal loans, that the problem of financing is not so much the interest rate level, but access to credit. The assumption is therefore that repayment capacity exists, and that the problem is the capacity of access to financing.
These different responses are novel, but they are not properly linked to all the rural development agents, which limits their scope and appears to leave unresolved the main problem of the traditional financing channels: the coverage and, with the possible exception of the experience of the NGOs, their ability to get through to the small producers. If the NGOs seem to be able to get through to the small producers, the problem with this strategy relates more to the nature of the programmes that NGOs undertake. NGOs cannot be expected to act as banks or to institutionalize any particular type of programme. To this extent the success of their strategies is not sufficient to ensure that they will be reproduced in the medium- and long-term. What is also required is a certain capacity for the small farmers' organizations themselves to take over these programmes. It would therefore seem appropriate to strengthen the producers' own credit systems, and attempt to formalize the most successful arrangements adopted by the informal credit markets. As in the case of the new approaches to agrarian reform, the key issue here would appear to be the provision of support to organize the producers.
Programmes to fight against poverty
SINCE THE END OF THE 1980S AND THE beginning of the 1990s, poverty has been identified as a central issue of rural development, together with targeted survival support strategies, as one of the channels for action which must be used in order to enhance the effectiveness of government action to help the most deprived. Three main features emerge from the programmes being implemented in this area: the powerful focus on the 'presidentialization' of the procedures for designing programmes; the definition of actions as priorities according to the requests of the beneficiaries; and the fact that they are implemented on a regional and, in some cases, municipal scale.
In order to achieve this transformation, new institutions have been created that report directly to the presidency of the republic, which gives them a great political weight and a powerful capacity for coordination and command over the other areas of federal government. By making them responsible to the presidency, the ministries and other government departments responsible for rural development are no longer entities for drafting programmes, projects and strategies, but are now executing agencies. With these programmes, governments as mediation structures are being weakened, while the legitimacy of the presidency is being enhanced. In the specific case of agriculture, these trends towards 'presidentialization' and the domination of the rationale of the demand and the municipalization of programmes are being demonstrated by the fact that, jointly with, or in place of, government, new vital agents are emerging both for managing agricultural policy (research, technical assistance, extension, marketing and financing) and agricultural policy-making. Rural development is no longer the activity of a specialized ministry, but is becoming a global and national plan. This is an important achievement of these programmes which must not be underestimated. To the extent that these are demand-driven programmes, the notion of economic and social citizenship has been able to develop quite rapidly, breaking with the former paternalistic approach of government intervention, and a new relationship is developing between government and the citizens which is more direct and without mediation.
However, the whole design of the presidential programmes, and the emphasis placed on the demand of the municipalities and communities in designing specific actions gives rise to a number of problems which must be recognized and solved. First, the capacity to formulate demands is not evenly divided among the different municipalities or organizations, because this depends on a prior accumulation of social capital and particular organizational experiences. Second, there is the problem of supervising the activities and subsequently of the global consistency of actions that are defined and implemented piecemeal and without a previously-designed overall plan. The advantage of supply-driven programmes was precisely their capacity to globalize objectives and establish consistency in the activities which is lost in demand-driven programmes, which also tend to overestimate the self-regulating and self-monitoring capacity of the programme beneficiaries. With regard to the problem of the overall consistency of a demand-driven programme, there is tension between recognizing collective, but local, initiatives, and the need for these initiatives to take an overall approach.
These issues must be discussed with the intermediate organizations in order to establish a consensus regarding both the target population and the procedures for identifying, stratifying and focusing on the beneficiaries. But this only shifts the problem to another and equally important sphere, which has to do both with the capacity of the producers' organizations to take part in designing programmes, and the will of governments to involve these organizations in designing, implementing and evaluating these programmes.
The role of government, international organizations, small farmers' organizations and NGOs
THE LATIN AMERICAN AND CARIBBEAN region has been through a period of macroeconomic stabilization and structural adjustment for almost 15 years. This has created certain institutional vacuums in important areas of rural development. The main question today is how to fill these vacuums, knowing that there are no margins for maneuvering and no general desire to return to interventionist Latin American governments. At the same time these vacuums cannot be expected to be filled automatically and satisfactorily by market forces alone. The particular configuration of the relationship between government, NGOs, small farmers' organizations, the private sector and international organizations has a role to play here, and to this extent it has a role to play in the global rural development strategy.
During the import substitution years, when policies were not yet described as 'populist', the external cooperation circuit took the shape of a triangle with certain virtues that legitimized governments, a recognized capacity to develop a local entrepreneurial environment, bringing some benefits to the beneficiaries of the programmes financed with external funding, and an institutional income that fueled the government's clientele. The three corners of the triangle were the international organizations, governments, and agricultural producers. The circuit worked in such a way that governments received the legitimating virtues of external cooperation.
The disengagement of government, the denunciation of the mishandling that was possible as a result of this circuit, and the increasing mistrust of international organizations in the capacity of governments to ensure that the benefits of the programmes were delivered to the most needy brought into being a new development agent, the NGO, from the beginning of the 1980s, and particularly in the 1990s. The triangle became a rectangle. This rectangle has its own peculiar features in which the main risks of external cooperation reside. First, the special relationship that exists between the international organizations and the NGOs tends to block the capacity of governments to give external cooperation an overall consistency within a global rural development strategy and prevents governments from exercising their functions of normalizing and controlling the work of the NGOs. Second, relationships between the NGOs and the producers' organizations create problems with the private sector which feels that it is being squeezed out of business opportunities that the public markets in the traditional triangle would open up. This relationship has other more serious effects in the political sphere: the government legitimation mechanisms are now replaced by the legitimation of the NGOs, and this increases lack of confidence in governments which leads to a weakening in the relationship between the state and the producers. All of this does not contribute to the institutional strengthening of all the rural development agents. The state withdrawal increasingly seems an expulsion of the state.
This risk must be avoided by restoring the equilibrium between the rural development agents and establishing relationships with a stronger capacity for self-momentum and complementarity. If this is not done, external cooperation will run the risk of wasting and scattering efforts and losing a powerful part- tier with an overall view of the problems and strategies (the state). The institutional weakness of this partner prevents any rural development strategy and policy within the global development model from being defined and from being jointly agreed upon with the other sectors of society. The government is the only development agent which can put this project to the whole of society and negotiate it, taking account of all the other interests of society. But in order to be able to do this, the government must be capable of doing it; lack of trust in its management capacity and its weakness can prevent it from succeeding. It has been acknowledged that even when government is decentralized, it must not be the only agent of differential policies. Other agents (NGOs, producers) should be involved not only in implementing policies but in the overall process of design, implementation, monitoring and evaluation.
But, it must also be acknowledged that only the government has the capacity to coordinate and oversee, and act as the main agent of the global strategy and the negotiator of this strategy with other social interests, because the government alone can claim to stand for the general public interest. The challenge of rural development therefore requires this rectangle to be recomposed.
TAKING UP THE CHALLENGE OF RURAL development can be put off no longer. It is an urgent task awaiting all the agents of rural development, and it is the responsibility of one of them to negotiate with the rest of society. Some conceptual elements for building a consensus around rural development and certain components of policies linked to rural development have already been identified. They make it possible to demonstrate that a rural rationale must be integrated into the development model pursued by Latin American and the Caribbean during the past 15 years, and that there are powerful internal and external constraints to implementing it. Government support, which is needed to promote this rationale, does not enjoy all the favourable conditions for the deployment of its organizational potential. This not only refers to budgetary conditions, even though these are important, but rather to the institutional linkages within the government and between the government and the other development agents who are needed in order to create the rural development space.
During the past few years momentum has certainly been given to rural development, but it has been marked by the pronounced political character of the actions adopted and, even though attempts have been made, they have failed to break away from an approach based on patronage. Even in the targeted presidential programmes, which are the most advanced form of developing a new intervention model, there has also been an unstable combination of former practices: authoritarianism, not only on the part of the government, a fairly modernized form of patronage, and a number of hopeful first signs of pluralist tolerance. This combination is not the most favourable to rural development or to the objective of supporting small producers in order to raise their living standards. The most that this combination can do is to make a fundamentally assistance-driven rural development approach more effective.
Without a more economical, productive and technological approach, it is unthinkable that rural development will be able to find a space for reproduction in the long term. But even this approach will not guarantee development unless it is accompanied with - and if it is not actually based upon - a new fabric of social relations, in which the producers' organization can play a front line role as development promoters. This presupposes recognition of the eminently positive role of small farmer pressure, mobilization and even social conflict. Social conflict with appropriate mediation measures is the best Cool at the disposal of modern societies to structure demands and fit them into a particular configuration of the general interest.
However the institutional weakness of the state and/or the producers' organizations, whatever form it may take (disengagement, expulsion or replacement of government, repression, co-opting, or playing down the value of the demands of small farmers' organizations), simply indicates the failure of mediation, without which no consensus is possible, no rural development strategy, no model to direct and give meaning to external cooperation and to the excellent but limited work of the NGOs.
It would therefore appear essential to tackle the problem of institutional weakness rapidly, and, by strengthening the rural development agents that are among the most vulnerable today, to establish new relations with the agents chat have grown in strength over the past few years: (i) relations between international organizations and NGOs requires government mediation; (ii) relations between NGOs and producers necessarily require the incorporation of local entrepreneurial skills; (iii) relations between producers, the private sector and the state on the one hand, and between the state and international organization must lead to the establishment of a new alliance; and (v) relations between the state and the NGOs must be based on mutual trust and the recognition of the specific functions that each is required to play in society.
"¿Desarrollo rural? Es asegurar la reproducción ampliada y sostenida de las unidades de producción familiar empresariales en un contexto nacional y de globalización. Para ello es necesario convertir a las unidades de producción familiares campesinas en unidades de producción familiares empresariales y lograr que obtengan una reproducción ampliada y sostenida."
MR. SERGIO ANTONIO OBANDO - NICARAGUA
Institutional strength built up in this way will make it more possible to fill the institutional vacuums that are making it impossible to break away from the assistance-driven approach to rural development. It will also make it possible to move on from specific support actions for survival strategies which have prevailed hitherto, and move towards a policy for creating productive and profitable activities in the countryside. And, it will make it possible to understand the various processes of resource access, and ways and means of institutionalizing them in order to act on these processes on the basis of a strong and regional linkage between government and small farmers. All this is perhaps the most concise and the fairest way of defining rural development.