Globalization's Impact: Rural Poverty on the Rise

29 November 2000

Published by the Inter Press Service Globalization's Impact: Rural Poverty on the Rise, Reports IFAD by Gustavo González

SANTIAGO, CHILE - Rural poverty has grown by 10 to 20 percent in a number of Latin American countries in the past three years, according to a report released Tuesday in the Chilean capital by Raquel Peña-Montenegro, regional director for Latin America and the Caribbean of the International Fund for Agricultural Development (IFAD).

The study reports that more than 90 million Latin American and Caribbean peasant farmers currently live below the poverty line, while 47 million live in extreme poverty.

The report was presented at the Catholic University of Santiago, which hosted an international academic meeting on ''Globalisation and Local Development: Challenges for the Small Farmer'', running Monday through Wednesday.

More than 300 experts from throughout the world are attending the gathering, held in the framework of the 16th Symposium of the International Farming Systems Association and the Fourth Latin American Farming Systems Research and Extension Symposium.

The report presented by Peña-Montenegro was described as the most complete study ever carried out on rural poverty in the region.

The paper gave rise to a book, ''Towards a Region without Rural Poor'', by Peña-Montenegro, Benjamín Quijandría and Aníbal Monares. The book, which was also launched Tuesday, details IFAD's strategy in fighting rural poverty in Latin America and the Caribbean.

The rural population of Latin America and the Caribbean shrunk steadily from 1980 to 1997, from a total of 122 million to 111 million, representing an average annual reduction of 0.87 percent.

Despite the positive macroeconomic trends reported in the region in the first six years of the 1990s, the proportion of rural poor and indigents remained constant during that period, and began to swell towards the end of the decade.

Peña-Montenegro pointed out that conceptual and methodological disparities in measuring poverty in the region have led to enormous differences in the statistics compiled.

While the Economic Commission for Latin America and the Caribbean (ECLAC) reported a total of 204 million poor people in the region in 1997, the World Bank estimated the total of people living in extreme poverty at 78.2 million in 1998.

Peña-Montenegro pointed out that the World Bank was referring to those living in absolute poverty, but she also warned that methodological choices were coloured by ideological visions.

One important consequence of underrating the number of poor is that the problem gets pushed down on the list of government policy priorities, while the image projected of progress being made in the region can lead to the loss of access to international development aid, she added.

The Rome-based IFAD was founded in 1977 to help the rural poor in developing countries help themselves. Since its creation, it has financed 548 projects in 114 countries with a total of 6.8 billion dollars in loans and donations. However, the agency's efforts fall short without other sources of cooperation, the regional director underlined.

In the past decade, IFAD has invested more than 600 million dollars in 50 projects in 23 countries of Latin America and the Caribbean. Counting the matching funds from governments and other donors, total financing amounted to one billion dollars.

According to ECLAC, 78.2 million people lived below the poverty line in rural areas in the region in 1997, while 47 million lived in extreme poverty.

Peña-Montenegro pointed out that the data collected since then indicates that rural poverty has grown between 10 and 20 percent in Central America, Venezuela, Mexico and Brazil, bringing the regional total to more than 90 million.

Over 90 percent of the rural poor in Latin America and the Caribbean are concentrated in areas totalling more than nine million square kilometres in northeastern Brazil, northern Mexico, northwestern Venezuela, the Pacific coastlines and central areas of Honduras and Nicaragua, and the northern parts of Peru and Chile.

The IFAD official noted that there was structural rural poverty that affected all ethnic minorities, rural women and landless peasant farmers in the region, as opposed to transitional poverty that affected small farmers, share-croppers and tenant farmers.

The rural poor are hit hardest by international crises and natural disasters. Hurricane Mitch, for example, which claimed thousands of lives in Central America in 1998, considerably increased the number of poor in that region, Peña-Montenegro observed.

There are 26 million rural indigenous people in the region, who suffer from high levels of poverty as a consequence of social and cultural exclusion, which also marginalises them from access to credit and other technical and financial resources.

Peña-Montenegro's report also underscores that women are the sole heads of eight to 10 million households in the region, two to three million women work as seasonal wage-labourers, while 30 to 40 million women in stable relationships are partially or totally responsible for their household's farming activities and small rural industries.

The study maintains that the adoption of neo-liberal policies in Latin America and the Caribbean has brought about a 40 percent reduction in investment in rural and farming areas, another factor that has contributed to the rise in poverty.

Farming, forestry and stockbreeding systems introduced as a consequence of the liberalisation of trade and access to external markets have had a heavy impact on the environment, the report adds.

The study urges that policies focusing on bandaid or superficial welfare solutions have failed to make inroads against rural poverty and should be replaced by agricultural development policies based on productive investment.

It also recommends safeguarding small farmers from ''premature exposure'' to international markets, in order to mitigate the negative impacts of globalisation.

Copyright 2000 IPS

From: Latin America Solidarity Committee http://www.converge.org.nz/lac

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