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FAO Addresses Rural Poverty

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The Food and Agriculture Organization of the United Nations (FAO), in cooperation with the Ministry of Agriculture, Forestry and Fisheries (MAFF) and the International Fund for Agricultural Development (IFAD), met yesterday to discuss strategies to address the vulnerabilities facing Cambodia’s small-scale farmers and landless poor.
 
The project launched by FAO and IFAD, “Pro-Poor Policy Approaches to Address Risk and Vulnerability at the Country Level,” aims to improve the institutional capacity of government agencies and assist in the formation of policies that will reduce risk to farmers and strengthen agricultural productivity and income.
 
The discussion focused on studies about beef cattle production, the growth of the vegetable sector and off-farm income generation. Although poverty levels in Cambodia have fallen in recent years, the World Bank in 2014 estimated that some eight million people were living just above the poverty line.
 
Borin Khieu, executive director at the Centre for Livestock and Agriculture Production (CelAgrid) and advisor to the project, spoke of the cattle industry as a promising market, noting the demand for beef had increased in the country as well as the region – with the average citizen consuming about five kilograms per year, according to FAO research.
 
Although small-scale farms account for most domestic beef production – 1.45 million farms produce 3.43 million head of cattle – there are barriers to farmers’ success. Among them are poor access to information and best practices, limited access to quality veterinary services and limited access to funds, agri-insurance and risk reduction tools.
 
While interest rates in neighboring Vietnam have moored at a rate of five to seven percent, in Cambodia they have soared to a dizzying 36 percent, making production a costly investment.
 
“We need to take into consideration the interest rate. Is it affordable? Especially when you are taking on many risks. We need to establish good rates with agri-banks, at up to 36 percent a year it is impossible to make a profit,” Dr. Khieu lamented.
 
Other concerns addressed the quality of meat produced. According to FAO studies, about 80 percent of domestic beef is sold at local wet markets. Without policy mechanisms in place detailing guidelines and standards for proper refrigeration and transportation, joining the export market could prove difficult.
 
“In order to export to the EU [European Union] countries we need to do a lot of work improving standards and improving the quality of meat. There are also trade barriers – due to the WTO [World Trade Organization] beef cannot just be exported to any country,” explained Dr. Khieu.
 
Pisey Khin, research director at the Nuppun Institute of Economic Research, also expressed similar concerns over the lack of standardized regulation, adding that informal trade and limited knowledge about production and storage resulted in low-quality vegetable yields unfit for foreign export markets and resulted in low profits.  
 
Research conducted by Cambodia Development Research Institute (CDRI) found that farming was still a primary source of income in rural areas, but concluded that about 60 percent of the farmers were landless, with most employed in the post-harvest industry. Those that sought employment abroad generally earned a higher wage.
 
Sothy Ear, a research associate at CDRI, said incentives were necessary to promote growth.
 
“If you go to the rural areas and you ask people there, ‘Do you want to leave your home?’ They will say, ‘If I can earn enough to survive I will stay, I will never migrate to another city or abroad.’ That’s why we think it is important to bring the incentives to farms.”
The project, which spans from 2012 to 2016, is being implemented in four countries across the region – Cambodia, Laos, Nepal and Vietnam.

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