eDialogue: What Future for Small-Scale Farming ? Wrap-up and Policy Implications

On November 25, the SDSN, Foresight4Food, IFAD, and APRA hosted the fifth and the last session in a series of eDialogues on the future of small-scale farming.Based on the recent blog post on the emerging themes of the dialogue by Jim Woodhill, Ken Giller and John Thompson, this session assessed the implications for national policy and development investments. It included a synthesis presentation, round table discussion on policy implications and closing reflections from participants.

The session started with a presentation by our special guest David Nabarro who presented some key insights from the Food System Summit Dialogues. The aim was to develop a form of dialogues about food that can be applied everywhere. So far, already 40 events took place with over 2000 participants.

David Nabarro , Strategic Director of 4SD, Convenor of the Food System Dialogues, Envoy of WHO Director-General on COVID-19, and Co-Director and Professor of the Institute of Global Health Innovation at Imperial College London.

The food system summit has four workstreams:

1. Scientific group
2. Action trackers and leaders for change with key areas (zero hunger, resilience, nature positive agriculture, sustainable diets, livelihood)
   
3. Advocacy and communication
4. Country engagement, which is why the dialogue was developed

Food systems are complex and locally variable with multiple stakeholders with different roles, perspectives and values.

Politics create structures in systems and make food systems more stable.

Through a dialogue, different stakeholders can gather to examine food systems and create circumstances that might allow system change.

Therefore, the dialogue must have:

• An inclusive attitude towards all diverse groups
• Principles that define the working attitude
• An encouraging environment

Three kinds of dialogues were developed

I. Country-Level Dialogues , following these steps:

Dialogues in countries lead by member states – stakeholders at national identifying the issues of the food system.
Dialogues everywhere in the country – enabling stakeholders to explore options for system change.
Dialogues at the centre of the country – examine the outcomes of the previous outcomes and identify pathways.
All countries were invited, and 30 countries already actively participate.
II. Global Dialogues
III. Independent Dialogues – every organisation can plan a dialogue and feed into the food system summit if they follow certain rules.

Jim Woodhill on the Emerging Themes of Past Sessions

• Small-scale farming is critical for achieving the SDGs in different ways.
• Small-scale farmers are not just farmers but have other livelihood strategies.
• Small-scale farmers are very diverse and live in a different context. To form the right policies, the differences must be understood.
• Small-scale farmers are not the problem but offer other services to the community next to food production (environmental services, services to the rural economy etc.)
• Linking farmers to markets and commercialisation are only part of the solution. Food production to self-sufficiency , off-farm opportunities and social protection mechanisms are essential. Hence, integrated policies are necessary.

David Nabarro on the Content of his Dialogues

Small-scale agriculture is only marginally touched in many discussions about food.

Six core issues came up in the dialogues:

1. Food is about four major issues:
   1. Nourishing people
   2. Ecosystem services
   3. Food production compatible with climate
   4. Livelihoods for everyone
2. Food systems are about people not about commodities.
   1. Their livelihoods
   2. their well-being
   3. their health
3. Farmers must be included in discussions; otherwise, they get highly abstract – Actual and practical issues could be overseen.
4. Farmers have multiple rules and are very diverse on jurisdictional level – Technical interventions can shift the basis on which farming works but not benefit the farmers
5. Aggregation of farmers , e.g. through farmers organisations, is vital.
6. Farmers are stressed about personal and economic and environmental concerns. They must be accompanied to take the stress away from them.

Read more in the Red Thread report.

Introduction and opening statements of the speakers

Ken Giller: Do we need a fundamental shift in incentives and policies to tackle the ongoing issues of smallholders. How might this shift look like?

Thomas Jayne, Professor at the Department of Agricultural, Food, and Resource Economics at Michigan State University

Quote of Wayne Gretzky, hockey player: “A good player plays where the puck is, but a great hockey plays to where the puck will be.”

Hence, Thomas Jayne lays out the major trends in Africa . In general, Africa is developing very well.

• Rural trades have risen by 60 % over the last 20 years.
• Education is rising in the last fifteen years – from 4% to 12 % of young Africans are attending university.
• Maternal and child mortality are declining.
• Financial inclusion is rising rapidly from 2011 to 2017. The percentage of rural women with a bank account has increased from 12 – 35 %.
• Access to infrastructure and electricity grew from 11 % – 40 %.
• The share of the workforce engaged in farming went down from80 % 20 years ago to now 50-60%.

What are the drivers :

• Improved livelihoods in rural areas -> increased purchasing power
• People spend their money on non-farm goods and services.
• Eventually, pulling people from semi-subsistence farming into more paid industries (jobs).

The pace of the transformation process is different in the countries, respectively. But in general, there are positive trends – mirrored by young Africans who are optimistic about the future of their continent – an important statement

Policy implications of inclusion:

• Policy discussions and processes are now more lead by Africans
• The role of externals is to support African lead approaches

Meike van Ginneken, Associate Vice President for Strategy and Knowledge at IFAD

Smallholder farmers are much more entrepreneurial than we give them credit for. Hence, they should be looked at as small food system entrepreneurs. Landholding is a significant limitation in terms of size and land rights. Nevertheless, we should empower, next to fixing land rights issues, the diversification of economic activities .

Not all smallholders and countries are homogeneous. It is important to identify the potential of diversification of food systems in individual countries. Thereby, IFAD focusses on four quadrants:

• Structural transformation: % of GDP of agriculture from the total economy – x-axis
• The productivity of agricultural workers – y-axis

Rebbie Harawa, Regional & Research Program Director, Eastern and Southern Africa at ICRISAT

There is a future of small-scale farming in Africa. 80 % of all farmers are smallholders and the communities rely on them.
In the future, there must be a total transformation with policies playing an important role.
We must move away from subsistence farming to agribusiness .

• Bringing technologies and good agricultural practices can drastically increase production – increasing self-consumption and trade.
• Crop diversification must take place to move away from maize.
• Proper incentives must be put in place for transformation.
• Subsidies
• Creation of private and demand-driven markets

Policies must be functioning and consistent . Only having policies on, e.g. production but not on markets results in disfunction of the put in place policy. Hence, policies must be aligned.

Furthermore, policies must be dynamic – they must be changed based on proper analysis and not because of a change of governments.

Angela Maria Penagos, director of the Agrifood System Initiative of Andes University in Colombia

For decades, Latin America was developing based on the idea that it will be a continent of big cities with a globally connected food production.

The reality, however, is different. There are still small and emerging towns and smallholders .

• It is difficult to integrate them into this complex future system.
• It is important to look at the role of women and young people .
• Many women are not connected to small-scale farms but pursue other practices.
• Young people are not keen to engage because of the bad perspectives of small-scale farming.

Furthermore, many small-scale farmers are linked with the production of illicit crops as their lacking opportunities.

Hence, small-scale farmers must be connected with small, medium and big cities through the production of food. Many smallholders do not produce food crops but cash crops like coffee for the international markets.

To integrate rural livelihoods with the rest of the country through the internet and the opportunity to partially move to cities, the government must realise that small-scale farming is not and agrarian but and development issue . Other sectors must be involved to implement interventions in rural areas.

Avinash Kishore, Research Fellow at IFPRI

Focus on subsidies – subsidy levels are high in South Asia and can distort the environment and economy.

• Still, smallholders are usually net taxed – food prices are kept stable through trade policies. Food subsidies are geared toward consumers and not towards farmers. This will not change shorts to mid-term.
• South Asian countries are developing countries.
• The number of smallholders is much lower than the number of consumers. Most smallholders are even net buyers of food who spend a high share of their high income on food. Rising prices hurt them a lot.
• The number of subsidies will rise in the future because
• when countries get richer, they subsidies their farmers.
• the income gap between agriculture and other sectors is rising. To maintain political stability, this must be controlled.
• You can only influence the kind of subsidies – moving from distorting subsidies to beneficial subsidies like direct cash transfers.
• Governments are acting slower than economists would like them too. But there are reasons for it.
• Changes can potentially hurt specific groups while benefiting others.
• The logistic of subsidies is complex – farmers are often not registered, data on their practices is lacking and they are not digitalised.
• Often these issues are developing problems for which other sectors must improve as well and must be aligned to the changes in agriculture.
• Lastly, there is a lack of evidence that certain policies and interventions are actually beneficial – policymakers need more confidence.

Elena Lazos Chavero, Professor at the Institute of Social Studies at the National Autonomous University of Mexico

Four key images:

1. Smallholders always have the neck in the water – slight distortions can drown them. They must be more resilient . Economic, social, and environmental crises can drown them.
2. Smallholders are very heterogeneous .
3. Agrofood nationals control food production and territories .
4. Smallholders can play an important role in policymaking if they are organised in coalitions.

Policies must be linked to the smallholders and they must be included in the planning process of territories.

Labour is crucial and smallholder enter and leave farming continuously.

Farmers need control over their assets , not global players – seeds, inputs, credits etc.

Local, real market possibilities must be established, which is difficult because of global commercial treaties like NAFTA which are unfavourable for smallholders.

Next to agricultural performance, the cultural linkages to territories must be reinforced .

To combat the issue of insecurity, e. g. due to violence, agricultural policies must be linked with social, health and educational policies .

Discussion

First discussion point: What is the role of the public sector? What sorts of policies must be introduced?

Thomas Jayne

A meta-study on eight Asian countries showed which policies had the highest payoffs for smallholder welfare :

• Agricultural R&D , technology, agronomy and crop science
• Good bidirectional extension systems – linking scientists and farmers
• Infrastructure

Developing countries with limited resources should thus invest available resources in forms of subsidies into the areas with the highest payoffs.

Ken Giller: There is multi-layered support in South Asia. What could be done purely by the market in relation to what should be the role of governments?

Avinash Kishore

The private sector will not provide:

• Research and Development
• Infrastructure
• Security of doing business
• Food safety standards
• Trade policies

Even in highly subsidies agriculture, markets play a big role . Agriculture is predominantly private, as the farmers and buyers are usually private entities . The question is how to align these in a way no one is exploited.

Meike van Ginneken

Subsidies will stay in the future and it is important to determine what public expenditures will focus on. Thereby it is essential to look at:

• Local public expenditure
• Global public expenditure

Public expenditure is good when it is well-targeted towards the poor. Less than two percent of climate finance goes to smallholders – that needs better targeting.

The African free-trade agreement is a big game changer and public expenditure will have a big return in that.

The available public expenditure must be spent properly – it is important to focus on the high payoff options to enable:

• Better livelihoods
• Better environmental conditions
• Better nutrition

Ken Giller: Are research and development expenditures filtering through to local smallholders?

Rebbie Harawa

There must be investments in smallholders in the form of subsidies – but in what areas?

Example of Ruanda:

• Ten years ago – focus on subsidising inputs
• Then graduate reallocation from subsidies from seeds to
• extension services
• irrigation
• land consolidation

The result of this was that even small-scale farmers (<0.25 ha) were able to produce a surplus.

Subsidising infrastructure is crucial to open up for other crops as well which is essential for nutrition.

Second discussion point: What does fundamental policy change look like?

Angela Penagos

It is important to think about how to allocate public expenditure .

In Latin America, this is currently, done based on the individual, not on the territory.

This must be changed through institutional and national entities to respect civil societies .

Farmers must be perceived as citizens but not be excluded by urban social protection systems .

Furthermore, it is important to include the social protection systems linked labour market. In Latin America, they are informal – The implications on social protection systems for the individual must be understood.

Thomas Jayne

How do you practically improve rural livelihoods?

An example is land:

• In Africa, land was registered to protect the land rights and to push investments into the land and increase productivity.
• But the land is getting sold after it gained value as well which promotes land grabbing.

Third discussion point: The important role of culture and civil society is better articulated in Latin America than in Africa. What are the suggestions to incorporate this into the idea of transformative policies?

Elena Lazos

In Mexico, communal lands and collective actions are still abundant. Individualisation acts against this culture. To give the farmers a voice again in policymaking common lands and collective rights must be empowered again . Otherwise, individual farmers sell their land and promote land grabbing.

Ultimately, this also protects biological diversity.

Fourth discussion point: We really need explicit transition strategies for smallholder agriculture. We need a long-term vision that could guide change. What are the steps you recommend for developing a transition pathway?

Thomas Jayne

Prioritise African lead policy systems and strengthen African University – locals must lead the process!

Meike van Ginneken

IFAD’s role in this must be providing knowledge and finance to small-scale farmers . We must look at them as small food system entrepreneurs and amplify their entrepreneurship to allow them to add value to the food system.

Rebbie Harawa

Market-driven diversification of crop production is vital . The government has a key role to play in this but must mostly be supported by the private sector.

Angela Maria Penagos

It is important to involve the small emerging cities to include the demand side as they are of high potential.

Productivity must be increased and linked to value chains and transformation processes.

The important role of civil society on the territorial level in terms of interventions to change the situation of smallholders must be recognised.

Avinash Kishore

Long term public investments mentioned by Thomas Jayne are essential.

The policy focus must shift from productivity focus to farmers income as this is the core need of the farmer.

Overall economic development is needed to fix the problems of the agricultural sector.

We must prepare for climate change . Investments can be useless of big crises disturb the system.

Elena Lazos

The political power of smallholder must be strengthened as they are the owner of the land, food and seeds.

Territory planning must involve cultural identities to protect their land and assets.

Food possibilities must be recovered . Over 2000 plants are available but not utilised yet.

Wrap-up by Jim Woodhill and Meike van Ginneken

We must look forward and understand the future role of small-scale agriculture in a completely transformed food system.

This requires a fundamental rethinking of incentives and policies.

Meike van Ginneken

Thinking about the future is crucial for revolutionary transformation. Food systems for livelihood, environment and nutrition must be put back on the agenda.