Empower Farmers by Making Credit Available: A World Food Day Lesson


World anything Day is a lot to take in. You’d think it might be easier to digest when a designated day for something global was also for something so familiar as food.

But I didn’t sense that with World Food Day, which arrived and passed Sunday without much fanfare, at least in North America.

Why’s that? After all, 800-plus million people are living with chronic hunger. Feeding the world is on the tips of everyone’s tongue, and reports suggest it’s not a futile effort — according to the United Nations Food and Agriculture Organization (FAO), the prevalence of undernourished people between 1990–92 and 2012–14 has fallen by 42 per cent.

I think those numbers make people throw up their hands in despair, and leave World Food Day messages wanting. Although the number of people undernourished in developing regions has fallen from 23.4 per cent in 1990-92, it’s still hovering at 13.5 percent of the overall population there.

But overall, efforts that follow high-profile events such as the World Food Summit and others seem to be having some impact. The FAO says food availability, in conjunction with improved access to food, is on the rise.

It says the principal problem is that many people in the world still do not have sufficient income to purchase enough food, or land to grow it on. That, according to the FAO, makes poverty the main cause of hunger.

So our initial reaction might be to supply aid.

And while that’s welcomed, it’s not what underdeveloped nations say they need in the long run.

Over the past few weeks, I spoke with representatives from Africa and Cuba, about what farmers need to succeed and be profitable.

Certainly, many of the world’s hungry people live in Africa, and on a relative scale, their problems are much bigger than Cuba’s.

But both nations are struggling. And their representatives – one, an African farmers’ union leader, and the other, Cuban government officials — say their biggest food-production need is the same: that is, access to credit.

Aid and grants are fine in the short term. But you can’t run a business on aid and grants. And farming is a business.

This is an approachable concept to anyone who uses credit for everyday purchases, let alone those trying to run a business. People need credit. And so do farmers in Africa and Cuba.

But unlike most of us in developed countries, these farmers have no equity. They don’t own their land. Creditors have nothing to seize if a loan goes bad, and are reluctant to give loans without security.

The African farmers’ union official I spoke with said helping facilitate loans to farms there is vital. “We don’t want grants,” he said. “We want loans. We need credit so we have some purchasing power.” This can come in the form of what’s called community microcredit. It doesn’t have to be a huge sum, just enough to promote a culture of borrowing and repaying funds, to help farmers get a leg up.

The situation in Cuba is a little different. Not only can farmers there not get credit, neither can others in the ag sector, because of the U.S. embargo (Cubans deem it a blockade). The embargo calls for any transactions with the U.S., for items such as machinery and inputs, to be paid in cash up front.

But where is a Cuban farmer or machinery dealer or fertilizer supplier who’s been subject to an embargo for 60 years supposed to get cash?

Bankers, financiers and economic policy makers are not typically those we look to on World Food Day to help eradicate hunger.

Rather, it’s considered a job for researchers, to help create new crop varieties and keep livestock healthy.

It’s considered a job for educators, to describe the problem to young people and help them arrive at create solutions, like efforts being made through food security programs like the University of Guelph’s Feeding 9 Billion initiative, where students help fashion approaches to world hunger.

It’s considered a job for farmers and the whole value chain in the food system, those who process food and distribute it.

And it’s considered a job for the media, to help mobilize information from sources such as universities, to users, such as farmers. That’s tough to do in a country like Cuba, where there’s no freedom of the press.

Now, it sounds like it’s also a job for those who control credit. Farmers can feed people, if they can buy seed, fertilizer and machinery to produce food. But where they need credit the most, they can’t get it.

If the world hunger situation is going to change, this limiting approach must change too. It’s not just lenders who need to be part of the solution, but rather, governments as well.

“There certainly have been questions raised about the adequacy of food and agricultural policy throughout the world, especially their (lack of) benefit to poor farmers,” says the FAO.

Exactly. Farmers need to be empowered, to help reduce poverty. That’s a simple World Food Day message that needs to resonate long after October 16.

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