Agricultural Renewal is Needed to Reduce Rural Poverty as Vietnam Moves to Middle Income Status

Contact: 
In Hanoi: Nguyen Hong Ngan
04.9346600 – 234
nnguyen5@worldbank.org

Hanoi, December 11, 2007 – The latest World Development Report says more and better investment in agriculture in transforming economies, including Vietnam, is vital to the welfare of the rural poor living in those countries.

The official launch of the report, titled ‘Agriculture for Development’, took place today in Hanoi by the World Bank and Vietnam’s Ministry of Agriculture and Rural Development.

”Growth in Vietnam has so far been benefiting both urban and rural areas. In 1993 two thirds of the rural population was considered poor in rural Vietnam.” said Martin Rama, Lead Economist of the World Bank in Vietnam at the launching ceremony. “Now the number has declined to one in five.”

“But as Vietnam embarks on its journey to middle-income status and beyond, the question is whether the same pattern of inclusive development can be sustained. Improving rural productivity and providing opportunities to the rural poor and ethnic minorities are needed to ensure that no one is left behind.” Martin Rama added.

The report says agriculture can provide pathways out of poverty for millions of rural poor who would otherwise be left behind in transforming economies. It says one way out is through a high-value agricultural revolution.

“Rapidly transforming economies, including Vietnam, must move beyond the green revolution to focus on new high-value agriculture—with fast-growing urban incomes and demand for high-value products in cities becoming the drivers of  agricultural growth and poverty reduction,” said Derek Byerlee, Team Leader on the report. “Globally, countries must deliver a level playing field for trade, while farmer organizations and other local groups need more say in setting policies.” 
 
Agricultural pathways out of poverty must be complemented by efforts to strengthen the growth of rural off-farm employment, and investing in poor area development programs including farming, migration and safety nets. Managing agriculture’s impacts on natural resources and the environment is also becoming a critical challenge with diminishing land and water resources for agriculture, overuse of agrochemicals, and climate change.

For its part, the World Bank is committed to increasing its support for agriculture and rural development. In FY07, commitments globally reached US$3.1 billion, marking an increase for the fourth straight year.

To download the full report, please go to http://go.worldbank.org/ZJIAOSUFU0