The World Bank and agriculture in developing countries

Commentary

By Karamoh Kabba

The World Bank seemingly demonstrates a chastened interest in maintaining a mere raw material producer status quo for developing countries in their trade relationship with industrialized nations.

Its recommendations and dealings with developing countries seem to be controlling the terms of trade than eradicating poverty. A quixotic creation such as “poverty reduction strategy” is a classic example of the underpinning whitewashed intention of the bank’s old economic imperialism phenomenon its relations with developing countries.

World Bank experts, in a first phase of this seemingly cloak-and-dagger ploy to keep poverty alive and well in developing countries, packaged and sold “poverty reduction strategy” to developing countries. Like an ace up their sleeves, comes “Greater emphasis on agriculture” to hammer and secure it in place. Indeed, poverty reduction phraseology seems in perfect harmony with “greater emphasis on agriculture”: If accomplished, both will work hand in hand to keep poverty alive and under control in developing economies.

This is another great ploy to mislead developing countries. World Bank experts, with their vast knowledge, know very well that agriculture alone does not take countries out of poverty.

Take a country like Israel whose well-being is a genuine concern to many of the G8 nations or say Japan that does not even have the land mass for extensive agriculture. Both nations are very highly industrialized with very little emphasis on agriculture. They have no business speaking of poverty reduction. The foregoing is unlike Ghana’s early plantation farming boom in cacao and coffee that lasted long enough before inflation and political upheavals kicked in, followed by Ghanaians infamous news of queuing for toothpaste to brush their teeth in the morning.

The World Bank, in all fairness, must be concerned about the wholesome eradication of poverty in developing countries, not a reduction of poverty, which sounds like surrendering peoples’ fate to poverty - all we can do now for them is to reduce the symptoms, it seems.

Greater dependency on agriculture without a strong manufacturing base, seems like a reinforcement of the existing status quo, whereby big corporations in industrialized nations sell a cup of coffee for $2 while the farmers in, say, Sierra Leone make only a few cents.

A robust agricultural sector without a robust manufacturing sector for a greater income realization for developing countries would only reinforce the old colonial mentality of raw material production. What is more, the lives of the rural people in developing countries won’t be any better than what is now prevalent.

Capital building strategy is the likely answer in these countries as opposed to poverty reduction. For the World Bank to succeed in improving the lives of rural people in developing countries, agriculture and manufacturing must go hand in glove. Evidently, goods manufactured out of raw materials from developing countries, once exported back to them, account for more than half of the infamous $1 a day earning of rural people in these countries.

If developing countries have the capital to become industrialized, they will in the first place not need the World Bank and donors to jumpstart their agricultural sector. There is no disagreeing that agriculture relieves hunger and starvation in these countries. The concern is that, without a strong and robust manufacturing sector, developing nations would forever remain producers of raw materials for their industrial counterparts and subsequently immersed in the business of relieving starvation only.

The World Bank should not speak of “rich-country trade barriers and subsidies for key commodities such as cotton and oilseeds” alone. It should advocate that industrialized nations willingly accommodate not only raw materials, but also finished goods from developing countries. Unfair business relationships between developing and industrialized nations is, for the most part, the main factor that makes poverty in developing countries a cancer that the World Bank would have to spend time curing.

Why should a bar of chocolate cost a cacao farmer in say Sierra Leone $1 when he/she sells a bushel of the main ingredient for less than $5? Here lies the devil in the details; the moral question the World Bank experts need to ask.

Developing countries need help with a capacity building strategy that will enable them to earn more income for their commodities in fair trade transactions. This can be accomplished through development of a robust manufacturing sector to complement a robust agricultural sector that will ensure that agricultural produce from developing countries not become mere raw materials to be exported in brightly colored packaging at exorbitant cost back to them.

Sierra Leone’s new diamond cutting and polishing industry is a laudable effort. Now, that country needs to find a way of exporting wedding rings to retailers in the G8 nations. The World Bank in all fairness needs to help these nations supply large retail firms and consumers in the G8 nations brightly colored packaging of their agricultural and mining produce.

In any case, the West has successfully established a seeming correlation between democracy and market economy, thus, the best possible way of promoting the former in developing countries is to promote the latter in them, not economic imperialism.