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October 31, 2009

Peasant agriculture is incompatible with economic development; Africa needs GM crops

by Paul Collier*

In the Western imagination Africa now stands for the antithesis of our own modern economy: its authenticity contrasting with our own contrivance. More specifically, the dominant image of Africa is that of the peasant farmer. In contrast to the large, commercial organization in which most of us find employment, the African peasant is self-employed. In contrast to the global market into which we find ourselves integrated, the African peasant produces for subsistence. In place of our restless mobility characterized by frequent changes of job and home, the African peasant is rooted to the ancestral soil. In contrast to our industrialized destruction of the global environment, the African peasant preserves as custodian the natural world. In contrast to our atomistic isolation, the African peasant is bound to a local community by ties of kinship and reciprocity.

As the global crisis has made starkly apparent, the deficiencies of our own economy, so these contrary qualities of the African peasant economy look increasingly appealing. Indeed, the counter-culture in our own society: the new emphasis upon the consumption of local produce, on organic food, and on farmers’ markets, is a pallid version of a lifestyle of which that of the African peasant is the hallmark.

This is not how I see rural Africa: I see not a paradise but a prison. Peasant agriculture offers only a narrow range of economic activities with little scope for sustaining decent livelihoods. In other societies people have escaped poverty by moving out of agriculture. The same is true in Africa: young people want to leave the land; educated people want to work in the cities. Above all, people want jobs: peasants are unavoidably thrust into the role of risk-taking entrepreneurship, a role for which most people are unsuited.

Globally, where people have the choice between the defined structure and safety of wage employment and the open-ended responsibilities of the entrepreneur, overwhelmingly they choose wage employment. Entrepreneurs are important, but in a well-functioning economy they are a small minority. The reality of peasant life is one of drudgery, precarious insecurity, and frustration of talent.

Millions of young Africans live out the reality of the most apt epitaph on rural life, Grey’s Elegy: “many a flower is born to bloom unseen, and waste its sweetness on the desert air.” Free to choose, they would abandon the peasant lifestyle. People remain peasants not out of preference for a lifestyle but because in Africa the normal process of economic development by which industry creates productive urban wage employment, has yet to start: their choice is between scratching an inadequate living as a peasant farmer, or the squalor of urban marginality.

Of course, concerned individuals around the world recognize that African peasants are desperately poor, not just in terms of income, but also in health and education. Yet our remedies for the overwhelming poverty of African peasant farmers are palliative not structural. We seek to raise farm incomes by increasing crop yields, to improve health standards through rural clinics, and to improve education through village schools. Our aim is to reconcile peasant farming with greater prosperity.

I am not hostile to these efforts: we should do whatever we can to ameliorate the conditions under which African peasants struggle to lead satisfying lives. But we should recognize these approaches for what they are: they are highly unlikely to be transformative. We know what brings about a transformation of opportunities and it is not this.

The Perils of Peasantry

The poverty of African peasants is not accidental: it is intrinsic to the peasant mode of economic organization. The very features that make the peasant mode of production appear attractive to jaded members of an industrialized society also make it unproductive. Large scale organization of specialized production, and integration into markets, are fundamental to the generation of income at a level that we now regard as necessary for a decent quality of life. We have been blinded to this evident fact by our own romantic attachment to the preservation of a society which is the antithesis of the modern.

The preservation of the peasant mode of organization has always been incompatible with economic development, but in Africa the issue is even starker than in other developing regions. Africa has the fastest population growth rate in the world, so that if the extra workforce is to be employed in peasant agriculture the average size of plot will continue to decline. Paradoxically, it is in Asia rather than Africa that peasant life may become viable because there the urban economy is now generating sufficient jobs for the rural population to be declining. This permits the average size of plot to increase, enabling peasant living standards to rise.

The failure of Africa’s urban economy and the consequent continued rise in rural populations will tend to reduce labour productivity and so African agriculture will continue to struggle simply to hold rural incomes constant, let alone for them to rise in line with incomes elsewhere in the developing world.

Not only will peasant agriculture be stressed by rising population, it will be stressed by a deteriorating climate. Global warming is already adversely affecting African agriculture: in the large semi-arid areas of the continent average temperatures are rising and average rainfall is declining so that cultivation will become more difficult. Around this gradual long-term trend, climatic variation is becoming more pronounced. Crop yields can be severely reduced by brief episodes of flooding, drought, and intense heat. As a result of climate change it is, for example, possible that in Southern Africa the staple crop of maize may become unviable. This deterioration contrasts with climatic change in the Northern Hemisphere where most agricultural production is already concentrated. As temperatures rise, huge territories of Canada and Central Asia will become better-suited to agriculture. As a consequence, Africa will become both absolutely and relatively less suited to agriculture.

The Promise of GMOs

African agriculture needs to adapt in order to become more productive and for this it needs new technologies and new modes of organization. To cope with climate change new crop varieties need to be developed. This will not happen within peasant agriculture: the sector is chronically ill-suited to innovation. New varieties require the antithesis of the peasant economy: they need big science. Indeed, to the horror of European environmentalists, they need genetically modified organisms (GMOs). Genetically modified crops were promptly banned in Europe in 1996: the powerful lobby for agricultural protectionism astutely whipped up a combination of anti-Americanism (the research was done by US corporations) and health scares, portraying GMOs as “Frankenfoods.”

Despite five decades of independence, Africa is still intellectually in thrall to Europe, and so virtually all African governments also banned GMOs. Because GMOs have been banned in Africa, there has been very little genetic modification (GM) research on the crops that are Africa-specific. As with much research, the lead time to the development of viable crops is long, around fifteen years. Ironically, the resulting lack of appropriate GM crops is used as an argument against the introduction of GM.

Africa needs all the assistance with crop adaptation that it can muster. GM is not a panacea, but it offers the prospect of developing varieties that can not only cope with climate change but are resistant to the fungi and pests that currently destroy so much of harvested crops in storage. Any non-governmental organizational (NGO) movement that was truly supportive of African opportunities would be pro-GM. The widespread opposition of the Northern development NGOs to GM reflects their real priorities: Africa is to be preserved, not developed.

In addition to big science, African agriculture needs big organizations. Although there are few scale economies in crop growing, there are important scale economies in all the ancillary activities: innovation, investment, finance, marketing, processing, and logistics. Commercial organizations exist because they are better able to solve such problems than are solo operators. Brazil has developed its agriculture using this approach and its companies are now interested in moving into Africa. But the idea of commercializing African agriculture remains taboo.

Pushing Industrialization

The development agencies that are hugely influential in African policy-making because of their large funding are in turn influenced by the attitudes of the Western NGOs. Although the clients of the development agencies are African, their paymasters are American and most especially European. A few years ago the World Bank estimated that around 80 percent of its incremental resources would come from Europe.

Europe, even more than the United States, is romantically attached to the peasant lifestyle that its own societies have abandoned. As a result the development agencies have been silent on the issue of GM, and have virtually ignored commercial agriculture. But most especially, they have failed to focus on the predominant implication of the poor prospects of African agriculture: the region needs to industrialize.

For millions of ordinary people industrialization has been a process not of bondage but of liberation from the drudgery of peasant life. Indeed, within Africa this is the predominant aspiration. Industry can expand to take up additional workers simply by augmenting its capital stock: capital can be expanded whereas land cannot. Further, industry is not dependent upon climate.

As India and China, the other major low-income regions, have rushed towards prosperity, Africa’s diverging income has given it the prospect of being competitive in global industry. This is, indeed, the common aspiration within Africa, but it is the donor agencies that have set the agenda in recent years, and their agenda has been skewed towards social services and rural development: industry has taken a back seat.

The neglect of public spending for industrialization is important because Africa’s low wages are not, by themselves, enough to make industry globally competitive. Breaking into industry is difficult: markets are global and established producers in Asia benefit from the scale economies that come from clustering firms together in large cities. Approximately, each time a city doubles in economic size the productivity of its inhabitants rises by 4-8 percent. African firms are handicapped in global markets by the small economic size of African cities: a problem of the chicken and the egg. One reason for the small size of Africa’s cities is the extreme political fragmentation of the region into 54 nations, each with a restricted national market. Few cities have a sufficiently large hinterland to grow truly large.

The solutions to a problem are not necessarily closely related to its cause. Africa’s difficulty in being a latecomer trying to break into global markets for industry is due to Asia having got in first, but reversing Asian development is evidently neither feasible nor desirable. Similarly, while Africa’s political fragmentation has greatly compounded the problem of the inadequate scale of its cities, genuinely greater political integration is at best a long term aspiration: Africa’s presidents are not about to make themselves redundant by merging their tiny fiefdoms. Nor is greater protection of the tiny African markets going to promote viable industrialization. Industry is increasingly global for a good reason: specialization raises productivity.

For Africa to industrialize, the developed world will need to adopt two complementary approaches. First, to break into global markets, Africa indeed needs protection in foreign markets. Rich countries need to provide temporary protection to new African entrants into industry from established Asian producers. This would provide African producers with a competitive advantage to offset the chicken-and-egg problem: once African clusters of firms grow to a competitive size, privileged access to our markets could be discontinued.

Second, we must focus our aid programs away from the social-rural agenda that has been predominant in recent years to one of targeted infrastructure for industrialization. African ports and power stations need to be brought up to international standards in order for firms in export zones to be able to insert themselves into global markets. In Asia, such zones have created many millions of jobs, and they could be transformative for the opportunities faced by ordinary Africans.

Astonishingly, this vision of urban industrial employment is opposed by many NGOs. Wedded to the romanticism of peasant life, they condemn wage employment in export industries with the vocabulary of “sweatshops.” Indeed, low-skill industrial jobs are mundane and routine by the standard of youthful aspirations in developed countries. But the climb out of absolute poverty is not a tea party. Most US citizens owe their current prosperity to the work of previous generations immigrants who struggled through low-skill, mundane employment. Today it is possible to shorten that phase: China is rushing through it far more rapidly than the equivalent period of industrialization in America or Europe, but it is not possible to eliminate it.

The granting of privileged market access to Africa and the reorientation of aid to industrial infrastructure depend upon decisions by our governments, but NGOs are sufficiently influential to block these decisions. To give a trivial but concrete example of this influence, I draw from experience. When evaluating the program of a major continental European aid agency, I urged programs more closely related to support for industrial opportunities instead of agriculture, health, and education programs. However, the response was that the country’s NGOs were not interested in such industrialization programs and thus they could not be prioritized. But blocking industrialization does not produce a kinder economic development; rather, it condemns Africa to further decades of stagnation.

It is time to get real. The organic peasant life is a luxury that appeals to those jaded by the downside of affluence. Ordinary Africans recognize peasant agriculture for what it is, and the most ambitious seek to leave. We have more influence over African opportunities than we realize: our legislators and our development agencies take their priorities not from African preferences but from ours. Our trade policies and our priorities for aid could reshape those opportunities. Until we shed the romantic notion that Africa can escape poverty while preserving its huge peasantry our policies will continue to be but a shadow of their potential.

*Paul Collier is Professor of Economics at Oxford and Director of the Centre for the Study of African Economies. He is the author of The Bottom Billion which won the Lionel Gelber and Arthur Ross prizes for 2008. His latest book, "Wars, Guns and Votes: Democracy in Dangerous Places," was published in March.

Harvard International Review

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