Principles of Agricultural Policy

In addition to the identification of objectives and means of policy, a strategic framework should also be based on principles that guide policy actions. In other words, the objectives of policy will not be pursued at any cost. The principles represent conditions or limits on the kinds of actions - means - that will be employed in attempting the fulfill the strategic objectives.

There are five basic principles for making an agricultural strategy sustainable over the long run, as follows:6

• Economic sustainability. The strategy must find ways to deliver real economic benefits to the rural sector. Although fiscal discipline is important, this means, among other things, not simply subjecting the sector to the fiscal retrenchment of a structural adjustment program. It is worth recalling the discussion in Chapter 1 about the importance of agricultural development for the growth of the entire economy.

• Social sustainability. The strategy also must improve the economic well-being of lower income groups and other disadvantaged groups, including women. Otherwise, it loses social viability.

• Fiscal sustainability. Policies, programs and projects whose complete sources of financing are not identified should not be undertaken. In an era of increasing budgetary stringency in all governments, application of this principle encourages a search for new sources of fiscal revenue and ways in which beneficiaries of the policies, programs and projects can contribute to their financing, i.e. ways to foster cost recovery.

• Institutional sustainability. Institutions created or supported by policy should be robust and capable of eventually standing on their own. For example, financial institutions which are just credit channels to farmers and ranchers, and which do not have deposit-raising capabilities of their own, are not likely to survive over the longer term. Equally, research and extension services that are supported mainly by international loans and grants are not sustainable in the long run.

• Environmental sustainability. Policies should be developed to bring about sustainable management of forests and fisheries stocks and reduce to manageable levels agricultural pollution of

4. Real agricultural prices, and real incomes, are agricultural prices and incomes deflated by an index of economy-wide prices. Thus, real farmgate prices are such prices relative to others in the economy.

5. This figure is taken from R. D. Norton, 'Integration of Food and Agricultural Policy with Macroeconomic Policy: Methodological Considerations in a Latin American Perspective', FAO Economic and Social Development Paper No. 111, Food and Agriculture Organization of the United Nations, Rome, 1992.

6. These principles were applied, for example, in developing Guyana's National Development Strategy and Estonia's National Strategy for Sustainable Agricultural Development.

Agricultural Income The Diagram
Figure 2.1 The role of agricultural programs in national economic development.

water sources and degradation of soils. A major challenge for agricultural policy in some countries is to slow or stop the expansion of the 'agricultural frontier', the zone in which cultivation is possible only by felling trees.

Some observers may prefer to call these principles objectives, and the decision is partly a matter of individual taste. According to the circumstances of each country, it may be desired to add additional principles to the above list, in order to guide the formulation of strategies and policies for the sector.

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  • eleanor
    What are the guiding principles of agriculture policies?
    2 years ago
  • Linda
    What is the principle of agrcalcheral policey?
    11 months ago
  • Lawana
    What is the principles of agricultural policy?
    11 months ago

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