CHAPTER 3
FOOD SECURITY, AGRICULTURE AND RURAL DEVELOPMENT
• Infrastructure: The lacking or low quality of rural infra- structure, including roads, electricity, clean water, storage facilities, and irrigation systems, can obstruct agricultural productivity and access to markets. • Market Access: Limited access to markets and value chains (for example, not enough feeder roads, or lack of knowledge of required quality standards) can result in low prices for farmers, wasted harvests, and hinder eco- nomic development in rural areas. • Policy and Governance: Effective policies and good gov- ernance are essential for promoting food security, sus- tainable agriculture, and rural development. Poor policy decisions can adversely impact the allocation of resources and the overall well-being of rural populations.
The issue of food security is closely connected to agricul- tural and rural development. Around three-quarters of the world’s poor live in rural areas and most earn their living from subsistence farming. Enhancing agricultural produc- tivity is considered one of the essential steps for countries to reduce poverty and increase food security. Adopting sus- tainable agriculture practices is also increasingly important for preserving the environment and ensuring long-term food production given the impact of climate change. Unpredict- able weather patterns, droughts, floods, and reduced crop yields means that efforts to boost adaptation and building resilience are crucial if the UN’s SDG 2 goal of “zero hunger” is to be achieved. However, many of the OPEC Fund’s partner countries face a number of challenges in achieving food security and lim- iting malnutrition due to factors such as persistent poverty, limited access to resources, climate change, and inadequate infrastructure. Meanwhile, smallholder farmers make up a significant portion of the agricultural sector in many partner countries. They often face difficulties related to access to inputs, technology, and markets. At the same time, farmers in rural areas in many partner countries also face obstacles such as lack of basic infrastructure, limited access to educa- tion and healthcare, and inadequate job opportunities. Fur- thermore, farmer incomes are affected by the non-availabili- ty or inadequacy of insurance to protect against increasingly unpredictable weather patterns and other factors that can impact productivity. There are other structural complica- tions that stand in the way of increasing smallholder output, such as:
FOOD PRICES AND FOOD SUPPLY
In addition to the challenges faced by farmers and agricul- tural value chains in developing countries, food security is also affected by developments in the supply of imported food staples, as well as in the prices of food and agricultural inputs. High and fluctuating food prices can reduce consum- ers’ availability of and access to food. Consumer food prices are partly shaped by developments in global wholesale mar- kets, as well as by pass-through factors in local markets. Food prices have seen significant shocks in the past few years. From 2020, the COVID-19 caused supply chain dis- ruptions as governments around the world reacted to the pandemic by implementing lockdowns and quarantines, which led not only to business closures but also to restric- tions on the movement of people and goods. Production of all manner of food and agricultural goods and services were essentially halted, leading to harvesting delays, stock de- creases, and trade disruptions – reflected in significant food price rises from May 2020 (Figure 5) .
• Land Tenure: Many smallholder farmers lack secure land tenure, land rights and access to land, which can hinder investment and long-term planning.
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