Implementing The Rural Development Strategy: A Progress Report

¹ In 2002, the World Bank laid out a renewed strategy for agriculture and rural development, entitled Reaching the Rural Poor. This strategy seeks to improve the well-being of rural people by fostering the conditions for rural growth—such as a competitive agriculture sector, a diversified rural economy with nonfarm employment opportunities, and a sustainably managed natural resource base.

The strategy identified the following major activities that the Bank would undertake in order to make this happen, and we am pleased to report that we are making significant progress.

• The Bank has sought to advocate for the needs of the rural poor in national policy dialogues and thus far—through products like the Drivers of Rural Growth and Poverty Reduction study in Central America and our support to the national strategy process in Vietnam—we have partnered with a wide range of stakeholders to facilitate the development of multi-sectoral rural strategies. Ten strategies are complete and 13 more are underway.

• The Bank sought to expand investment and in the two years since the strategy was approved, the Bank has expanded rural lending from about US$5 billion to over US$7 billion last fiscal year.

• The Bank has sought to scale-up innovative approaches in rural development, and we have had success on a number of themes such as community driven development in rural areas in Brazil and India; watershed management in China, Turkey, and Tunisia; and land administration in several countries in Eastern and Central Europe and in Asia.

• The Bank has sought to introduce innovations to address the continuing challenges facing agriculture and rural development. The new strategy has influenced a broad spectrum of innovations, such as rehabilitation of irrigation systems and strengthening of water users' associations in Mexico and China; natural disaster mitigation areas like Europe and Central Asia and the Pacific Islands; public-private partnerships in the agriculture sector in China and Uganda; enhancing the rural investment climate in countries, such as Sri Lanka and Nicaragua; and weather risk insurance in India, Ethiopia, and the Ukraine.

• The Bank has sought to improve the quality of its operations, and the Agriculture and Rural Development Department has implemented sectoral quality enhancement reviews for that purpose. Our Quality Assurance Group shows that the quality of new rural development projects has improved.

• The Bank sought to implement global corporate priorities, especially those that impact the rural poor, and we continue to do so by strengthening our interaction with the CGIAR, by actively supporting our clients as they participate in the current World Trade Organization (WTO) round of negotiations, and by addressing new challenges, such as fisheries management.

• And finally, we have sought to enhance our partnerships with donors and other stakeholders and we continue to do so through forums such as the Global Donor Platform for Rural Development—which the Bank and its partners created in 2003. We are indebted to our partners in FAO and GTZ for running the day-to-day operations of this platform that has brought our agenda's closer together. Our most recent endeavor on this front is the new Standards and Trade Development Facility (STDF)—a multi-donor initiative that will help developing countries enhance their capacity to analyze and implement international sanitary and phytosanitary standards, which are critical to countries trying to access export markets. A multi-donor trust fund has been established with three confirmed contributions and several more expected in the near term.