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Assignment 4: Agriculture policy and globalization (Food and agriculture issues)
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1. Policy Issue and Title
Agriculture policy and globalization (Food and agriculture issues)
Agriculture forms a crucial component in the world’s economy. It is key in provision of nutritious and health food for the world’s population. With an increasing world’s population, it calls for increased production from the agricultural sector to ensure provision of sustainable food. To ensure continuous production, then agricultural policy need to be championed which govern domestic and imports of foreign agricultural products. The worlds governments put in place agricultural policies with a key objective of obtaining a certain output from local agricultural harvests.
2. Context and importance of the issue
Globalization in the agricultural sector has been key to increase in food production. The movement of resources which enable improved agricultural production like; inputs, outputs, monetary resources, agricultural information, and associated scientific techniques in agricultural zones. The globalization of agriculture has enabled an increase in food production playing a key component in the reduction of poverty levels (Najib Akesbi, Jose-Maria G., 2001). This decrease in poverty level is also associated with agricultural sustainability. The globalization of agriculture however does not occur smoothly because of the challenges faced in distribution of resources as well as difficulty in policy implementation (Kym Anderson, 2010). The agricultural sector has been evolving from times in history. The improved scientific discoveries in this filed have enhanced accelerated growth which have resulted to improved storage of perishable products. Agricultural processing has enabled the reduction in bulk of products. Policies have enabled price stability of agricultural products, improved product quality, selection of products, creation of employment, as well as issues around informed use of land. The key stakeholders who are affected by issues around agricultural policies and globalization include; farmers, agricultural based factories, local governments, as well as the food consumers (Kym Anderson, 2010). Generally, agricultural policies affect almost everyone in the world proving to be a key issue to be addressed by every government.
Globalization is associated with reduction in the cost of local and international trade of farm products. The industrial revolution which has been enhanced by evolution in technology, have caused a great improvement in the agricultural sector. Proper means of communication have been key to trade development due to controlled supply of goods and services to the areas they are specifically demanded. This has enhanced the evolution of agriculture towards the attainment of a sustainable production. Most countries in Asia have been boosted in their economy by investment in agriculture like in the growing of rice alongside other cereals (Kym Anderson, 2010). The agricultural sector is key in determining the trends of world food prices. Increase in food price is associated with low productivity creating a situation of increased demand with reduced supply.
The impacts associated with agriculture policy and globalization, create cost reduction techniques as a result of advancement in technology. Low-income countries are now able to improve their agricultural production ability and investing agricultural research programs. The agricultural policies help in the improvement of infrastructure thus creating a flow of products from faming regions to markets. In developing countries, creation of urban agricultural markets in cities which help in product marketing (Anderson K., Cockburn J., Martin W., 2010). However most of the developing countries have competition from foreign competitors who supply products efficiently due to availability of good infrastructure. This has largely affected the rural economy but through globalization has influenced infrastructure growth in rural areas those creating a status of a competitive market.
3. Rationale and justification for your position
Globalization and agricultural policy have helped in good positioning of agricultural commodity. This has increased the growth of the sector thus having a substantial change in the attainment of a food sustainable environment (Alston J. M., Beddow J.M., Pardey P. G., 2009). Production of high quality agricultural products has been enhanced by the continued investment in research as well as scientific discoveries.
In an attempt of increasing productivity, diversification is a key issue which agricultural stakeholders should consider. Investing in livestock production, horticulture as well as farming of a countries staple food ensures sufficient production for the human population. The demand of food stuff, is not influenced by population growth and increased levels of income alone. The prices of oil are a key issue is setting the prices of commodity (Kym Anderson, 2010). This means that humanity should mitigate the rate of climatic change, as well as proper utilization of water which is a key resource helps in standardization of food prices at a sustainable perspective.
4. Propose a course of action
The low-income countries have to copy the ways which high producing countries use to ensure productivity of agricultural products within their reach. This will result to decrease in cost of provision of food stuff for citizens because the cost of transportation will not be a big factor in the chain of production. Farming systems should be properly implemented, investing in crop diversity helps in improving productivity in a case where one crop fails to produce. The benefits obtained from globalization are key in attaining a food secure environment.
Low- income countries should invest in their resources and champion agricultural production unlike remaining dependent of foreign aid which is associated with the weakening of the competitive nature of market environment (Kym Anderson, 2010). The net trade situation in low-income countries is poor because most of the people here concentrate in consumption of stable foods avoiding horticultural products which prove to be a bit expensive. Agricultural trade policy reforms should be put in place to ensure that healthy competition happens which is key to economic growth of a country. The existing trend of agricultural protection of the high-producing countries should be abolished as well as the removal of anti-trade policies (Alston J. M., Beddow J.M., Pardey P. G., 2009). The anti-trade barriers that existed caused agricultural products from high-producers to fetch high market prices from the growing nations. This triggered developing world to form regional trade arrangements, but due to an increase in international pressure, then the World Trade Organization was formed. The world bank has backed low-income farmers with incentives in an attempt of increasing their productivity. Some of the policies derived to assist farmers include the nominal rate of assistance (NRA) and the relative rate of assistance (RRA).
5. Argumentation and evidence
Major issues that pose a challenge to agriculture are associated with consumer taste, pest and diseases, trade barriers, poor infrastructure, reduced labor, lack of proper technology, and above all climatic conditions which are associated with scarcity of water (FAO. 2008). Improvement in agriculture plays a key role in improving the world’s economy because most people live in rural areas. In this situation, governments should assist farmer, provision of incentives which reduce the cost of production of horticultural products resulting to their increased production in an attempt of achieving a harvest of tradable agricultural products. This can be a key sector because production in farms has proved itself to have faster rate of returns than other forms of production. Over the years the structure of the global agricultural market has been changing. These changes can be associated with development of technology used which has been key to reduction in cost of agricultural inputs as well as its products. Investing in agriculture results to a great increase in a countries GDP as well as creations of job opportunities. Governments should invest in agricultural research programs and development. To increase the rate of agricultural production then we should utilize our natural resources, labor, time and produced capital (Kym Anderson, 2010). Countries with a higher number of natural resources have a stronger it their comparative advantage in the production of primary products. In some countries, comparative advantage is reduced because of the reduced level of arable land and labor availability. Failure in agricultural production results to a general decline of a countries economy. The rate at which a country declines in agricultural production is backed by an increase in agricultural globalization.
6. Closing remarks
Threats in agriculture have posed a serious challenge in attaining a food environment. Globalization is key in opening the agricultural economy for trade to occur. Cooperation of key stakeholders is important for smooth growth of agriculture in the world’s nations. The challenges associates with trade barriers, corruption, custom inefficiencies should be addressed to ensure agricultural development. Agriculture is widely affected by climatic change and global warming. The change in climate calls for changes in the farming systems which have proved to be very expensive to rural communities. Giving an example of the African countries, climatic change has caused decline in the agricultural productivity of the region declining the rate economic productivity due to decline in trade. This situation has been witnessed in the past one decade. Set agricultural policies have enabled increased productivity of the region even at unfavorable conditions (Alston J. M., Beddow J.M., Pardey P. G., 2009). This has increased the comparative advantage of the products in the region, a situation which is associated with reduced trade costs as well as policies which do away with the anti-trade bias policies.
Low-income countries however are associated with many trade barriers which slow down the rate of movement of commodity. Production of bulky commodity is barred by lack of proper means of transport. In poor transport, some agricultural products lose their market value due to increased rate of perishability.
References
Alston J. M., Beddow J.M., Pardey P. G., (2009) “Agricultural research, productivity, and food prices in the long run. Science 325, 1209-1210”.
Anderson K., Cockburn J., Martin W., (2010) “A agricultural price distortions, inequality and poverty. Washington, DC: world bank.
Kym Anderson (2010) “Globalization’s effects on world agricultural trade, 1960-2050”.
Najib Akesbi, Jose-Maria G., (2001) “Globalization, Natural resources and Agricultural policies in the Mediterranean region”.
FAO. 2008 the state of food and agriculture: biofuel prospects, risks and opportunities. Rome, Italy.
