Access to Inputs, Markets and Services

Rural development is hindered by the insufficient utilization of inputs. Only specific groups of farms employ modern, yield increasing technologies.

By means of measures affecting the price and interest policies, the governments should encourage the small farms to increase the utilization of purchased inputs. To that end, local institutions have to be established in order to make them available, all of the farms must have equal access, and it should be possible for local groups to participate. It is of crucial importance that the capital goods be available at the appropriate time and as input package.

Regarding the organization of extension services, various forms should be experimented with, and particular attention should be paid to reaching small farms and cooperatives. In order to equip subsistence farms with inputs, preferential prices should eventually be conceded and the access to social services ensured.

Local markets and cooperative institutions should be promoted to improve the conditions on the credit and commodity markets. Especially small farms will benefit from the promotion of informal markets and cooperatives. When making credit available, the requirements of small farms for building houses, consumption, production, and refunding debts should be taken into consideration. Eventually, subsidies will be required to compensate for the high costs of granting loans to small farms; the same applies to risk funds. Owing to the low risk capacity, insurance against crop failures, price support, and other measures against price fluctuations are of special importance to small farmers. All marketing institutions need a well developed infrastructure for which public and local funds have to be made available. The price policy should ensure that in the choice between products for the domestic supply and for exportation, attention is paid to the interests of the domestic food supply.

Rural development demands more research on problems of the rural sector and funds must be supplied for that purpose. The goal of eliminating poverty should be given due consideration in fixing the research priorities, and appropriate technology for small farms and cooperatives should be conceived. The problems of agriculture in arid regions and shifting cultivation are also urgent. Technological and economic research should be coordinated with social science studies in order to understand the socioeconomic implications of technological change in particular. Especially studies and innovations which minimize ecological disturbances are worth promoting, as well as studies on cheap building technology for building houses for the poor in the rural areas.