Rural areas are key to the eradication of poverty and hunger and economic growth in developing countries, according to the 2017 State of Food and Agriculture report published by the UN Food and Agriculture Organization. And with the majority of the world's poor and hungry living in these areas, achieving the 2030 Agenda for Sustainable Development will depend on unlocking this vast potential, argues the report. It states that the transformation of rural economies has been credited with helping hundreds of millions of rural people lift themselves up out of poverty since the 1990s, but progress has been uneven. Many countries in sub-Saharan Africa and South Asia are still lagging behind. The prospects for eradicating hunger and poverty in these countries are overshadowed by the low productivity of subsistence agriculture, limited scope for industrialization and above all explosive urbanization, the report warns. Another challenge is rapid population growth, especially among young people. Between 2015 and 2030, the number of people aged 15-24 years is expected to rise by about 100 million to 1.3 billion. Most of that increase will take place in sub-Saharan Africa. Rural people who relocate to cities will likely run a greater risk of joining the ranks of the urban poor, instead of finding a pathway out of poverty. FAO says that the solution can be inclusive rural transformation.

Targeted policies and investment to rural areas are required to achieve inclusive rural transformation and build vibrant food systems. The report makes the case that a major force behind rural transformation will be the growing demand coming from urban food markets, which consume up to 70% of the food supply even in countries with large rural populations. The value of urban food markets in sub-Saharan Africa is projected to grow from US$150 billion to US$500 billion between 2010 and 2030. “Urbanization thus provides a golden opportunity for agriculture. However, it also presents challenges for millions of small-scale family farmers,” writes FAO’s Director-General José Graziano da Silva in the foreword to the report. He warns that more profitable markets can lead to the concentration of food production in large commercial farms, to value chains dominated by large processors and retailers, and to the exclusion of smallholders. Urban demand alone will not improve production and market conditions for small farmers.

The report therefore outlines three lines for action to achieve rural transformation. First, supportive public policies and investments are required. “To ensure that small-scale producers participate fully in meeting urban food demand, policy measures are needed that: reduce the barrier limiting their access to inputs; foster the adoption of environmentally sustainable approaches and technologies; increase access to credit and markets; facilitate farm mechanization; revitalize agricultural extension systems; strengthen land tenure rights; ensure equity in supply contracts; and strengthen small-scale producer organizations”, da Silva writes. The second line for action is to build up the necessary infrastructure to connect rural areas and urban markets. The report says that in many developing countries the lack of rural roads, electrical power grids, storage facilities, and refrigerated transportation systems is a major bottleneck for farmers seeking to take advantage of urban demand for fresh fruit, vegetables, meat and dairy. Third, rural areas need to be connected to small urban centres. Half of the total urban population in developing countries, or 1.45 billion people, live in cities and towns of fewer than 500,000 people. “Territorial networks of small cities and towns are important reference points for rural people, the places where they buy their seed, send their children to school and access medical care and other services,” da Silva adds. Transformed rural economies won't necessarily be a silver bullet solution to stop migration to the cities and tackle poverty and food insecurity, but it could generate much-needed jobs and contribute to making migration more of a choice, rather than a necessity, the report concludes. (ab)