Tuesday, November 13, 2007

Agri development, East Asia vs. Africa

I think what distinguishes (north and south) East Asian experience in agrarian reform and agricultural development compared to that in African experience, is that in the former, there is strong entrepreneurial component. Maybe it's because of the "Confucian ethics" (see how hard-working are the Japanese, Koreans, Chinese, Taiwanese, Hong Kongers, Singaporeans, for instance) or similar philosophical or religious beliefs, but there is strong entrepreneurial spirit even among many Asian farmers. The desire to produce for a surplus beyond the household's regular consumption needs, sell the surplus output to buy new farm inputs + household needs like appliances, etc.

Even Hanoi City and Vietnam as a whole, although it is under a communist government, private entrepreneurship is very much alive. Rice farmers produce plenty of rice for export to other countries in Asia and elsewhere. Vegetable farmers produce extra for profit in the cities and abroad.

If farmers have sufficient opportunity to make profit for their hard labor, they will not need much WB or ADB money for their farms, they can borrow money and farm inputs elsewhere, pay the loans after a good harvest and have extra for their farm modernization.

Meanwhile, the Philippine experience in on-going "agrarian reform" is one of the biggest hindrance to agricultural investments. Some farm entrepreneurs are reluctant to develop their farms into say, fruit orchards, because there is a threat that once the farms become productive and profitable, the government's agrarian reform officials will come in and say that the land will be under land reform and be sold to the farm workers. So the environment of uncertainty contributes to lack of agri investment.