Structural adjustment and agriculture in Guyana: From crisis to recovery

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SAP 2.84/WP.143

Structural adjustment and agriculture in Guyana:
From crisis to recovery

V. Conclusion

Agriculture is still the mainstay of the Guyanese economy, accounting for around one-quarter of GDP, half of the exports and one-third of employment. Thus, agriculture is key to both employment generation and poverty eradication and by extension to continued growth of the economy. Agriculture will have to contribute the bulk of employment opportunities well into the next century and unless it does so at reasonable levels of income the urban employment problem will deteriorate from push-induced migration from the rural areas. Thus this report urges an agricultural-oriented long-term strategy for Guyana, with an emphasis on the smallholders. In such a strategy the key requirement would be to increase production amongst the self-employed subsistence-oriented farmers. A policy shift is needed to ensure this in terms of building up the infrastructure serving the smallholders. Some key areas are highlighted below.

Drainage and irrigation. Water management is the one major determinant of agricultural production which is why the population is mostly concentrated in the coastal strip 80 miles long and 20 miles wide. Sea-defence structures have to protect this strip since most of it lies below sea level. The infrastructure has deteriorated physically and along with that the spirit of cooperation needed to ensure equitable use of water. Canals require constant weeding and cleaning, without which they clog up. An efficient D&I system would enable the harvest of up to three crops per year, compared to just one as now.
Research and extension. Yields are constrained by the farmers' limited knowledge of newer cropping techniques. The extension service should be the purveyor of these but unfortunately the years of recession have taken their toll in terms of the amount of research done on new seed varieties and farming systems. More research is particularly needed on all aspects of rice farming, since rice translates in practical terms into incomes for the smallholders.
Markets. Smallholders' access to markets declined during the recession because of the neglect of the road network, particularly the feeder roads for the remoter farmers. As a result the smallholders contribute very little to marketed fruits and vegetables and even for rice. Whatever they are able to market depends on their access to vehicles provided by the larger farmers. Development of a feeder road network would contribute significantly to equitable growth in the agricultural sector.

The kind of measures suggested above would go a long way to ensuring a better distribution of growth. The shift in policy toward smallholders should not come at the neglect of the current efforts to increase Guyana's exports of rice and sugar, which basically means from large-scale farmers. Overall growth will depend on results achieved here. What is recommended as a shift is that a greater part of the increased resources flowing from increased exports should be devoted to the smallholder sector to improve their basic infrastructure.

The imperative to include the interior region in the growth process cannot be overemphasized since basically this means including the indigenous Amerindian population. Although 10 per cent of the total, they contribute over three times as much of the poverty groups. So far their involvement in the development of the economy has been through employment opportunities created by the mining and logging concessions in their region and through tourism. Their food crops have received very little research attention, so much so that quite a large part of their requirement has to be imported from the coastal areas. Better market facilities could reduce such imports. Direct production activities which offer scope for expansion are local handicrafts and small-scale logging. Indirect benefits accruing from concessions in mining and forestry however will remain the mainstay of their economies. Here it is essential to ensure that more opportunities for employment are provided to the indigenous people and that development of the interior does not occur at the expense of environmental degradation.

The last decade of growth portends a bright future for Guyana. Most of the decline suffered during more than two decades of economic mismanagement has now been recuperated. Further growth will be conditional on pursuing the course of macroeconomic stability and searching out new markets for Guyana's exports. In all this agriculture will remain the basic determinant of Guyana's prospects. Up to now agricultural growth has contributed to poverty eradication only indirectly by creating employment opportunities for workers on the large-scale rice and sugar farms. More and more a direct assault on poverty will require addressing the problems of the small-scale farmers. The very fact that so far their yields and marketable surplus are limited points to the potential for increases that exists.

Updated by BR. Approved by OdVR. Last update: 28 September 2000.