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Chapter 2

The MFCAL Concept


Previous approaches to agriculture and related land-use issues have developed sophisticated tools that help to understand the complexity and diversity of rural areas. Since the Den Bosch Conference in 1991 and the Rio Summit in 1992, proponents of "Sustainable Agriculture and Rural Development" (SARD) have developed a comprehensive view of topics including rural extension and research, science and technology, infrastructure, human capital and sustainable livelihoods. SARD encompasses a wide range of economic, socio-cultural and environmental questions related to agriculture.

The concept of multiple functions builds on these previous approaches by:

Thus the concept facilitates understanding of the complex interactions between agriculture and related land use, the multiple goods and services (food and non-food) produced by agriculture, the contribution that these goods and services make to the achievement of wider societal goals, and, in turn, the impacts on agriculture of the environmental, economic and social domains, including demography and the increasing globalisation of markets and trade.

While the multifunctional character of agriculture is intrinsic, the agenda for food and agriculture has only recently started to focus on the policy challenges relating to reinforcing a range of functions.

After nearly a decade of focusing on a sustainable agriculture agenda, there has been some progress in translating sustainable agriculture concepts and priorities into practice. However, resource managers need appropriate incentives if greater use is to be made of sustainable practices. The incentive structures should offer farmers opportunities and interests which go well beyond agriculture and subsistence food production. Increasing understanding of the many opportunities and constraints affecting success in improving sustainability underlies the present concern with a broader policy agenda for food and agriculture.

A broadening of the policy agenda also arose from a reassessment, in many countries and regions, of the role of agriculture in economic development. In different contexts and for quite divergent reasons, there is increasing policy awareness of the continuing role of agriculture and land in development for low-income and high-income countries in all regions.

Increasing regional differentiation in agriculture, and associated divergences in developmental goals and priorities, are yet other factors stimulating interest in the specification of multiple functions. An examination of the debates in various international forums demonstrate that values and goals for agriculture and land use are not the same across regions or even among countries within regions. This is most apparent in various negotiations relating to international trade.

The multiple functions of agriculture and land offer different specific benefits in different contexts and in different regions. The best combination of functions results in optimum management for economic, social and environmental purposes.

In regions with poor and low potential agriculture in the developing countries, where it is generally difficult to ensure the renewal of natural resources and the sustainability of agricultural ecosystems, but where subsistence agriculture is likely to remain a major activity, the advantages of a combination of options are:

In regions of developing countries where the market economy now predominates, but where conditions are not favourable to agriculture and the natural environment is fragile, emphasis on multiple functions can play an important role by:

In areas where intensive agriculture is practised, but which suffer from environmental problems, the impact of combining functions can result in:

In the "traditional" agricultural regions in developed countries, where production runs the risk of becoming increasingly less competitive, emphasis on multiple functions can result in:

In regions on the agricultural frontier in forest zones or where the environment has a high production potential and where the market is rapidly taking root, use of the MFCAL concept can contribute to:

In each case, the value and importance of the various functions must be assessed before deciding the most relevant forms of action. The choice of measures is always subject to debate, between local communities, local and state government, technical agencies and external partners. Measures and action are then based on common agreement, joint evaluation of achievement, and periodic reassessment and re-negotiation.



In 1939 "there were almost half a million farms in Britain including part-time holdings. The majority were small, mixed units of less than 50 acres, with cattle, sheep, pigs and poultry as well as some arable crops. Before the age of state protection farmers needed to grow a range of products for financial security. If the price of any one product collapsed, there were others to buffer them against ruin. Economically this mixed-farm structure was extremely stable. It also happened to produce a vigorous and attractive countryside, rich in wildlife and largely free of pollution.

At the same time almost one million workers were employed wholly or partly on British farms. Thus almost 1.5 million families were able to make part or all of their living from the land, while delivering environmental benefits as a "free" extra. Never has the British countryside looked so good. Never has it supported a richer diversity of habitat and wild species..." (Harvey, 1997: 9)


Today, home kitchen gardens are particularly well developed on the island of Java in Indonesia, where they are called pekarangan...In one Javanese home garden fifty-six different species of useful plants were found, some used for food, others as condiments and spices, some for medicine and others as feed for the livestock ... Much is for household consumption, but some is bartered with neighbours and some is sold...So dense is the planting that to a casual observer the garden seems like a miniature forest...Closer analysis shows the high diversity in the home garden is matched by high levels of productivity, stability, sustainability and equitability...(Conway, 1997: 177)


"The positive outcomes of an increasing rural population density included, in Machakos (with a population of 1.3 million), the stabilisation and reversal of land degradation, increasing investment in land-improvement, technological change, higher output per hectare and per person, agricultural and income diversification and diminished vulnerability to food crises..." (Mortimore, 1998: 196)


"Paddy fields have a structure to retain large quantities of water. Paddy fields contribute to lowering the risk of landslides and floods...Calculated from the water retention capacity, the water buffering function of paddy fields in Japan would be approximately 5 billion m3, which is more than eight times as large as the reservoir capacity of the largest dam in Japan...A study indicates that the monetary value of multifunctionality, such as land conservation by paddy fields in Japan, amounts to more than 4.6 trillion yen per year, which far exceeds the total output of rice production at approximately 3 trillion yen per year" (Government of Japan, 1999)


Agriculture is the activity that occupies the largest share of "humanised" land in all countries, and therefore plays a significant role in humanity's transformation of the environment. These transformations have moulded the landscape and natural systems of rural life over centuries. In most countries, agriculture still represents the direct and indirect base for the economic livelihood of the largest share of the population. It is not surprising, therefore, that, in addition to food and fibre, agriculture contributes in many ways to the activities of societies. Agriculture furnishes goods and services that can be classified as distinct "functions." Instead of simply distinguishing between food and non-food outputs, the MFCAL concept implies the joint and integrated production of a multiplicity of outputs, which may be significant both to society and to the environment.

The key functions to which agriculture contributes are as follows:

The combined effects of the four functions contribute to achieving rural development.

2.2.1 Food Security

Food security exists when all people, at all times, have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life. (WFS Plan of Action). Food security is interrelated with a variety of factors, including sustainable management of natural resources (agriculture, fisheries, and forestry), increased production, policies at different levels, international trade, maintenance of biodiversity, protection of the environment, investment, peace and stability.

Political support for achieving food security is high as is shown by the fact that 112 Heads or Deputy Heads of State and Government, and over 70 high-level representatives from other countries adopted the Rome Declaration on World Food Security and World Food Summit Plan of Action in 1996.

Food security and the environment

In many parts of the world, unsustainable and otherwise inadequate policies and programmes, inappropriate technologies, insufficient rural infrastructures and institutions, as well as pests and diseases, lead to inefficiency and wastage of natural and human resources, inputs and products. The resource base for food, agriculture, fisheries and forestry is under stress and is threatened by problems such as desertification, deforestation, overfishing, overcapacity and discards in fisheries, losses of biodiversity, as well as inefficient use of water, climate change and depletion of the ozone layer. These negative effects on the environment threaten long-term food security.

Food security and economic and social development

The economic and social development of the rural sector is a key requisite for the achievement of food security for all. Poverty, hunger and malnutrition are some of the principal causes of accelerated migration from rural to urban areas in developing countries. Poverty eradication is essential to improve access to food. The vast majority of those who are undernourished either cannot produce or cannot afford to buy enough food. The rural areas in developing countries are generally poorly equipped in terms of technical and financial resources and educational infrastructure. In these areas, lack of income opportunities, failure to harvest crops, inadequate maintenance of production systems, inadequate distribution networks, limited access to public services and the poor quality of such services are all fundamental aspects that need to be considered with regard to rural food security.

Expanding production in low-income food-deficit countries (LIFDCs) is frequently one of the primary means to increase the availability of food and income for those living in poverty. This needs to be complemented by generation of employment and income which will raise effective demand in these areas, in turn stimulating production, economic diversification and rural development and thus long-term food security.

Food security and trade

Trade is a key element in achieving world food security. Trade generates effective utilisation of resources and stimulates economic growth which is critical to improving food security. Trade allows food consumption to exceed food production, helps to reduce production and consumption fluctuations and relieves part of the burden of stock-holding. It has a major bearing on access to food through its positive effect on economic growth, income and employment. Appropriate domestic economic and social policies will better ensure that all, including the poor, will benefit from economic growth. Appropriate trade policies complement such policies and help to attain the objectives of sustainable growth and food security for all.

Unless national governments and the international community address the multifaceted causes of food insecurity, the number of hungry and malnourished people in developing countries will remain very high and sustainable food security will not be achieved. The international community has a key role to play in supporting the adoption of appropriate national policies and, where necessary and appropriate, providing technical and financial assistance to assist developing countries and countries with economies in transition in fostering food security.

Food security and MFCAL

Clearly, attaining food security is a complex task which requires an enabling environment and policies that ensure peace, as well as social, political and economic stability and equity. The combination of economic functions (enabling conditions for credit, investment and trade) and social functions (attention to public services, human resources and equity) related to agriculture can help to achieve this goal. The concept of MFCAL may offer a useful perspective and tools to specify options for decision-makers to achieve food security.

2.2.2 The Environmental Function

As actor and guardian, humanity plays a dynamic role in the maintenance and viability of any ecosystem. The environment has a role vital to sustaining all life, as well as to satisfying most requirements for fundamental services such as recycling air and water, furnishing basic materials, energy and other resources, and in other areas such as recreation. All agricultural and land-use systems directly affect the components and operations of local ecologies. Nearly all ecosystems have thus progressively become managed systems, though the results vary widely.

Agriculture and related land use can have beneficial or harmful effects. Indeed, the impacts of agricultural systems have become intimately linked to the normal functioning of most ecosystems. Agriculture can influence the quantity and quality of the water supply for industrial and urban destinations, through maintenance of watersheds, infiltration and a regular level of fluctuation in the water table. It can help to control erosion, and thus heavy run-off with negative downstream effects. When this occurs, the economic impact is indirect and spread over time.

The direct environmental benefits of agriculture include: pollution abatement through management of soils and vegetation; increases in biomass and nutrient fixation with mixed cropping, land use and fertiliser application; and increasing ecosystem resilience with techniques that control erosion.

Agriculture can also have negative effects on ecosystems and on the renewal of natural resources. Examples include agricultural practices with excessive use of chemical inputs, irrigation and mechanised tillage. In most cases these systems are highly specialised, using production systems with multiple functions but significant disbenefits. The main negative effects are pollution, the loss of resilience and diversity of the cultivated ecosystems, and the non-renewal of soil structure, which makes the land much more vulnerable to external shocks and reduces its capacity to recover after a shock. This is the case, for example, during the dry season when the soil has lost water storage capacity or when heavy rainfall has had an erosive effect due to the loss of the structural stability of the topsoil.

Changes in the environment are of concern at many levels. The negotiation and implementation of international agreements has become a major mechanism for influencing practices in the use and management of the environment. The series of Conventions established since the Rio Summit, notably regarding biodiversity, climate change and desertification, have direct implications for agriculture. The Conventions establish both guidelines and objectives for conserving some key resources. Particular attention has been focused on the dangers of the reduction of biodiversity, which represents a definitive loss of genetic materials, and on the level of emissions which can contribute to global climate change.

The relevance of the MFCAL concept to enabling the agricultural sector to respond to the specific global problems of climate change, desertification, biodiversity, water quality and availability and pollution, encouraging beneficial impacts, limiting harmful impacts on the surrounding environment, increasing reliance on renewable resources, and taking account of possible cumulative impacts, is illustrated in the box below.

For the whole of the environmental function, however, the MFCAL concept can guide the process of optimising linkages between agriculture and the biological and physical properties of the natural environment. The reinforcement of the capacities of local institutions to ensure the sustainable management of local resources is crucial. In order to stimulate investment and longer-term planning, farmers must be confident that they have adequate rights of ownership, managed access or other tenure arrangements. When rights of access to the resources are unclear, obsolete, or relegated by other forms of rights, or not honoured, the users are more likely to use resources for their own immediate interest. The resources may not be managed sustainably, not renewed and ultimately become depleted. This applies equally to forests, rangelands, water, fisheries and wildlife. Such conditions inevitably give rise to conflicts. Enduring resolution of conflicts requires a respect for the rules, whether these rules are set out in a new contract established among the users themselves, or in relation to the state and other actors. In all these cases, a system for monitoring and imposing penalties in the event of a breach of rules is necessary.


Climate change

In terms of global warming over the next 20 years, emissions from agriculture are projected to represent about one-third of the total. Clearing of forest lands for agriculture and slash-and-burn agriculture are major contributors to carbon emissions. Agro-forestry and sustainable livelihoods based on forestry, including non-wood products, are excellent alternatives.

Agriculture can help to combat the greenhouse effect, primarily through a better management of nitrate fertiliser use and by substituting carbon through the use of biofuels. Significant reductions in burning and surface exposure through some forms of ploughing can cut CO2 emissions. Also, more intensive use of organic matter can contribute to carbon sequestration in the soils, which is one of the natural functions of cultivated ecosystems.

This is where the multifunctional character of agriculture and a number of joint potential benefits can be directly exploited. Policies to stimulate new practices could combine producer training with the provision of financial incentives. The Kyoto and Buenos Aires negotiations on the Climate Convention are moving policies towards such measures. These include the "Clean Development Mechanism" and proposed mechanisms for an "emission rights" market. Whatever instruments are chosen, the availability of financing will make it possible to encourage the spread of carbon-fixing, substitution and reductions in emissions.


Agriculture and forestry can contribute to limiting desertification (see the Background Paper 3: Drylands, FAO/Netherlands 1999c). Many techniques have already been tested and used, including managing watersheds using water storage techniques, anti-runoff techniques, planting trees and soil fixation species and water control earthworks. Implementation requires detailed technical co-ordination for consistent implementation and production of synergistic effects. In order to succeed, land and natural resource owners and users must agree on how the work is to be carried out, financed and scheduled. Local communities can benefit as a whole from these developments, but individuals and social groups can lose and gain to differing degrees.

Such measures presuppose significant institutional capacity for negotiation and mediation. Successful examples demonstrate that people often have a keen awareness of the problems involved and are ready to accept solutions demanding great effort, both in terms of physical investment and demonstrations of good will in negotiation and performance. Negotiations should cover all dimensions of proposed transformations, with responsibilities, tasks and beneficiaries defined in detail. Support - whether financial or material - has to be carefully targeted in order to encourage the investments needed.


Agriculture has major impacts on biodiversity, on-farm and off-farm. On the other hand, biodiversity itself, including both domesticated and wild species, underpins agriculture, in several ways, and at several levels (see the Background Paper 1: Agricultural Biodiversity, FAO/Netherlands 1999a). Crop and livestock genetic resources provide the main productive elements of agriculture, and the genetic diversity within crops and livestock allows continued improvement and adaptation to changing needs through evolution and deliberate breeding. At another level, many components of biodiversity provide essential ecological services to agricultural production systems: soil organisms ensure nutrient cycling, and natural predators provide for pest control, for example. Diversity at the ecosystem or landscape level is also often important in providing for stability in production systems.

Different agricultural practices may impact on biological diversity positively or negatively. Integrated Pest Management, for example, may preserve natural predators. Conservation of soil organic matter may have synergistic effects by stabilising natural predator populations through supporting their alternative food sources. Use of traditional landraces may help to conserve genetic resources of global importance to farm crops. Changes in agricultural practices, and new technologies, may enhance or reduce agricultural biological diversity.

Water Quality and Availability

The increased demand for water for agriculture, industry and urban areas is heightening competition and potential conflict in many regions(see the Background Paper 6: Water, FAO/Netherlands 1999f). Agriculture can make a major contribution to water storage through conservation techniques on the land. Individual and local gains are linked to common social benefits. Maintaining forests can facilitate water infiltration in the public interest. Negotiations, contracts and incentives stimulate the interest of land users, who might otherwise prefer to clear the land and farm rather than maintain or replant the forest. There are also new techniques which can reconcile agricultural use of land with water infiltration, for example by using cover vegetation which reduces runoff, and combinations of hydropower, supply of drinking water and gravity irrigation.

At the national and regional levels, public water-basin management agencies can design and adopt the necessary incentive measures and instruments. Internationally, promoting joint improvements in the management of international waters is based on conventions and through financial mechanisms such as the Global Environment Facility.


There are many solutions to reducing pollution including regulation, the "polluter-pays" principle, negotiations of contracts, and public incentives. Most countries are adopting and implementing environmental legislation laying down a framework to resolve conflicts. There are also many technical solutions available to agriculture. Changes can be made, for instance, in on-farm production techniques for Integrated Pest Management, the limitation of chemical fertiliser use and the use of crops and trees to recycle nutrients lost by leaching. Industrial innovations can also be useful, such as treatment of animal waste for transformation into energy and marketable fertilisers, multiple encapsulation of fertiliser in order to release nutrients only in limited quantities and under specific humidity and temperature conditions, and the production of less harmful chemicals.

2.2.3 The Economic Function

The main function of agriculture and forestry is the physical production of goods. These are primarily foodstuffs for human consumption or through trade (as commodities). Primary production also yields feed and fodder for animal consumption, raw materials destined for energy (for example for co-generation of heat and power using alcohol), biogas (see the Background Paper 2: Bioenergy, FAO/Netherlands 1999b), pharmaceuticals, and other products for clothing, habitat or other uses.

Agriculture remains a principal force in sustaining the operation and growth of the whole economy, even in highly industrialised societies with small farm populations. Investment or some new activity, linked for example to production diversification or to an increased level of activity, can generate economic effects both upstream and downstream of agriculture and related land use. On the demand side, agriculture requires inputs in the form of labour, various services and financial capital. As outputs, agriculture supplies products and services which are processed, transported, marketed and distributed. There are multiple linkages to other sectors. All these economic effects can be estimated using national accounting and economic calculations.

Assessment of the benefits and impacts of agriculture goes well beyond the primary production function. Valuation of various functions includes projections of potential short, mid and long-term benefits. The complexity and maturity of market development is fundamental to the economic function (see the Background Paper 4: Environment and Trade, FAO/Netherlands 1999d). The level of institutional development is crucial, as are the potentials of the sustainable natural resource base for goods and services.

2.2.4 The Social Function

The social functions of agriculture incorporate concerns important for all nations, from the most industrialised to the least developed. MFCAL recognises negative effects of prevailing agricultural practices once these are discovered and enables stakeholders to seek measures that not only counter or mitigate these, but also make use of possibilities for synergy. The immediate objectives are to increase the viability of rural areas and their communities and sustain the cultural values related to agriculture and land for both urban and rural societies. However, these objectives can be accomplished in several ways, and with different outcomes.

Rural areas are associated with notions of "culture," "tradition," and "identity." These notions are perceived as a positive, indeed an essential, good. However, agrarian communities have undergone dramatic transformations. For example, labour migration to cities and linkages to these centres have major impacts on rural incomes and resources. In the most marginal agricultural zones, the resident populations have become dependent on a permanent exchange with and remittances from the exterior. Ties to urban and often international markets are consistent features of rural economies. The enduring and emerging dynamics between rural and urban areas can be taken into account in analyses based on the MFCAL concept.

The MFCAL concept has the advantage of not focusing strictly on production as the single, or even necessarily the most important, agricultural function for contemporary rural societies. The approach extends to a range of activities in relation to the land and the resource base, including caretaking of vital natural features, sustaining secondary and tertiary activities related to agriculture and land, maintenance of the historical and cultural heritage, recreation and returning retirement migration. The integrity of local and national cultures is often rooted in systems of belief and understanding that have gradually emerged in rural areas. Social viability thus does not depend on the "food function" alone.

The importance of the social function becomes evident when considering rural areas in the most industrial nations, which have only modest direct importance for employment and national revenues. However, the socio-cultural functions of agriculture and land apply equally to many mid-level income countries, as well as to other rural societies tied to urban areas or to other forms of activity for revenues. The social aspects of urbanisation and out-migration must also be considered, without a preconceived view of the relative merits or disadvantages of these processes.

Another entire range of issues is associated with questions regarding the general well-being of rural populations. Descriptions at multiple scales and levels can capture the considerable local variations in social conditions, as well as specifying vital linkages to sub-regional and other levels. In documenting experience, assessment can extend to the importance of questions related to gender, age, stratification, social categories, equity, differential access to resources and relative opportunity. The results of the analysis can be used to evaluate and influence the direction of future interventions regarding agriculture, taking into account the need to maintain the basic services and economic opportunities needed to keep rural areas attractive to community members. These include schools, dispensaries and other health services, security, communication, roads and transport.

The availability of information and education can also fall into the social function, though these issues cut across the spectrum of functions. Of particular importance is the valuation of local knowledge and the forging of relationships between local communities and external sources of expertise, information and advice. The effectiveness of policies on public information depends on the existence of an expression of the collective will of local people to ensure that their society can continue living in a sustainable manner. This will may be explicit if articulated by the local leadership or implicit when the growth and development of local activities create a favourable state of mind in the community.

Where agriculture has become highly specialised and makes highly intensive use of inputs produced by the chemical industry, landscapes have changed considerably and in some cases pollution has become widespread. People in certain societies, particularly when these are industrialised and with high incomes, have gradually developed a preference for forms of agriculture which at least partly preserve historic landscapes and reduce pollution. Demand is expressed in different ways: in political terms, by the emergence of "green" parties and platforms, nature conservation groups or associations, and in market terms by the emergence of a demand for agro-related tourism and high quality products. These products convey a positive - indeed often romanticised - view of rural landscapes and cultures. Such demand can be manifested both in a private and in a public form. There is an increasingly clear demand for "traditional" and artisanal, farmed products. In order to meet demand, quality must be certified through controlled denomination of origin, compliance with technical specifications, and effective quality control. In order to obtain these products, consumers are willing to pay a higher price than that of an equivalent standard product. Producers must follow stricter regulations for some products (for example, in the care and feeding of animals).

But the demand for landscape and rural culture conservation cannot always be fully expressed by the demand for the produce of the land. There is also a demand which has all the features of a public demand: amenities to which everyone has access (non-exclusion). This is the case with rural landscapes. Some of these amenities can be expressed in the form of a demand for tourism and leisure (hotels, restaurants, museum visits, entertainment). Maintenance of demand requires preservation of the visual aspects of the original landscape (earthworks or pre-existing infrastructure, hedges, trees and forest groves, use of local materials for construction and techniques, etc.). Even intensely transformed landscapes with high population pressures, such as coastal and other waterfront areas, are increasingly under modification to recapture their original character.

Finally, multiple stakeholders - at different levels and scales - are the key to the future of agriculture and land. Stakeholder preferences and actions regarding goods and services are expressed directly through markets, and indirectly through public institutions (local, state or other mediators). They are central to issues of effective leadership, decision-making and empowerment at the local level, and at sub-regional and national levels. At the local level, the stakeholders are the farmers and other groups directly engaged in production, as well as groups in management and landholding. Those active in non-agricultural rural services such as banking and administration are also involved.

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