Globalisation: a threat or a promise for the rural poor?

How are the rural poor affected by globalisation? What threats and benefits does globalisation pose for them? Can they share in the potential benefits it offers?

This research surveys the ways in which globalisation is affecting the welfare of the rural poor, and argues that it offers them both potential benefits and dangers. ‘Globalisation’ refers to the growing interdependence of the world’s economies, manifested in increases in capital movements, the rapid growth and liberalisation of world trade and multinational corporations, and increased technological interdependence. It is possible to identify different ways in which globalisation is likely to affect the welfare of the rural poor, by influencing resource use, economic growth and income distribution, and by its impact on technologies, livelihoods security, policy and public service provision. In particular, the rural poor are affected by agricultural change, as small-scale farmers and wage labourers.

Globalisation offers potential benefits for the rural poor, from accelerated economic growth following fuller integration into export markets, and from more productive resource use, improved access to technological advances and policy improvements. Against these benefits, there are very real dangers that the rural poor will be left behind, lacking access to knowledge and other assets necessary for success in an increasingly competitive world. Other dangers are that continuing political and policy biases will prevent them from sharing in the potential benefits, that food security may be reduced, and that globalisation will be associated with widening income disparities.

Globalisation’s potential to intensify such inequalities, and to heighten instability and uncertainty, can prevent general economic progress from leading to improvement in the wellbeing of the poor. However, certain factors will determine how the balance of the positive and negative tendencies is affected, and how these can be addressed in terms of market access, positive government policy, and the assets of the rural poor – notably education, land, water and finance.

The report’s findings suggest that:

• Any tendencies for globalisation to favour labour-intensive agriculture in developing countries tend to be offset by biases in technological progress favouring temperate crops and capital- and skill-intensity.
• Agricultural trade liberalisation has so far taken place to a very limited extent.
• Within many developing countries, liberalisation remains partial, and industrial protectionism and other anti-agricultural biases persist.
• The rural poor cannot respond adequately to market opportunities and heightened competition because their market access is limited (for example, by lack of market information, weak institutions and poor infrastructure) and because they lack assets (for example, education, land, water, capital) that would raise their market effectiveness.

Policy implications include:

• In the long term, poor small-scale farmers are unlikely to be able to respond to population pressures, growing international competition, agricultural commercialisation and greater technology use.
• These pressures, combined with growing rural labour forces in many developing countries, suggest that the rural poor will increasingly have to rely upon the sale of their labour.
• Their welfare is likely to be closely linked to: economic development creating alternative employment and opportunities for migrants from rural areas, the development of non-farming opportunities within rural economies, and efficient labour markets that encourage labour-intensive development and facilitate the absorption of rural labour within both rural and urban economies.

Source(s):
‘Globalisation and the rural poor’, Development Policy Review, by Tony Killick by June 2001

Funded by: International Fund for Agricultural Development

id21 Research Highlight: 17 January 2003

Further Information:
Tony Killick
Karibu
Standard Hill
Ninfield
Battle TN33 9JU
UK

Fax: +44 (0) 1424 893 873
Contact the contributor: t.killick@odi.org.uk

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'Signing up to globalisation: assessing trends in developing country trade'

'New world order? In search of stability for the global economy'

'Globalisation: a threat to social policy?'

'Global problems, global solutions: why we need a UN Economic and Social Security Council'