C.1: Policies and Institutional Measures

Policy options and institutional measures to improve efficiency and adaptability in production, processing and marketing systems, and meet the changing needs of producers and consumers

Other Information:

The efficiency of production, processing and marketing systems in generating and bringing to consumers a quantitatively and qualitatively adequate supply of agricultural, fishery and forest products is often limited by market imperfections, weaknesses in support institutions, or an unfavourable policy environment. These factors hamper the mobilization of resources for agriculture and rural development - in particular, they discourage investment in productive assets and services - and impede the adoption of appropriate technology and practices. They also make it more difficult for the systems to adapt to changing circumstances, such as the need to supply burgeoning urban populations. As agriculture is increasingly commercialized, there is a growing need to focus on improving production support services, including input supply and rural finance. A dynamic production sector also requires efficient marketing, post-harvest and processing systems, with associated demand signals guiding farmers' decisions. The challenge is to create a policy and institutional environment that encourages resource mobilization, more efficient support institutions adapted to changing conditions and more accessible to users, and greater responsiveness to the market on the part of farm, fisheries and other production units, agribusinesses and marketing enterprises. The focus of FAO's work in this area will be on providing countries with appropriate policy options and enhancing their ability to choose among them and to implement them. Particular attention needs to be paid to the role of women in production, processing and marketing. Strategy components: The components include: identifying priority issues, emerging concerns and opportunities arising from international and domestic trends, as well as the economic and institutional constraints that may limit the efficiency of production, processing and marketing systems; advising on responses to the issues thus identified in order to ensure remunerative market conditions that enhance production and availability of supplies and to encourage savings and generation of domestic resources for investment; promoting the diversification and specialization of production to take advantage of new opportunities as well as of comparative advantages based on different resource endowments; helping to strengthen agriculture and rural development support institutions and facilitate their adaptation to changing conditions, in consultation with users and giving due importance to gender-based and other inequalities in access to services; and encouraging structural adaptations in production, processing and marketing systems so as to respond to evolving consumption patterns (e.g. with attention to peri-urban agriculture) and to build on complementarities among crop and livestock production, fisheries and forestry. Comparative advantages and partnerships: With competence in agriculture, forestry and fisheries (policy, resources, production, processing and marketing), FAO is a major source of independent advice on policy in these sectors. It plays a leading role in a number of international initiatives on sustainable forestry and fisheries management. It has developed and tested methods for participatory, gender-sensitive support in formulating equitable agricultural policies and in improving outreach systems. On production and post-production support systems, it is recognized for its normative work, often in partnership with donor agencies, and is thus well placed to advise on policies and institutional measures in this area. It has a record of accomplishment in mobilizing resources for agricultural and rural investment, and extensive experience in helping to prepare investment plans and projects (e.g. for land and water development and use) with a view to optimizing resource allocation. It is also well placed to advise on potential trade-offs and synergies between the productive and other functions of agriculture and land use. Within the UN system, it is task manager for Chapter 14 (Promoting sustainable agriculture and rural development) of Agenda 21. Collaboration will continue with other UN bodies in respect of policy analysis and assistance activities at the sector and subsector levels, as well as provision on request to Member Governments of independent information and sectoral analyses complementary to the macro policy work of the Bretton Woods institutions. In helping to formulate policy choices and to develop decision tools, FAO will also continue to strengthen links with CGIAR, academic and research institutions, bilateral development agencies, NGOs and associations of producers, traders, processors and consumers. Cooperation with civil society organizations (CSOs) and the private sector at large will be of increasing importance, in view of the need to address issues of concern to consumers and to enhance the role of the private sector in ensuring adequate agricultural supplies, including through possible joint initiatives for local infrastructure and agribusiness development.

Indicator(s):

Indicator:1

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