Transforming Economies for Jobs and Inclusive Growth

Abstract

Although “inclusive development” is a relatively new term, the concept has deep roots. In one of its first appearances as a concept, Kuznets discussed links between economic growth and income inequality (Kuznets in Am Econ Rev 45 (1):1–28, 1955). This chapter discusses strategies for jobs and inclusive growth in countries where extreme poverty is high, with a focus on sub-Saharan Africa. It begins by exploring why the need for inclusive growth is so great on the continent. It reviews the analytical drivers of the need for inclusive development. It also provides lessons from Asia and case studies of how development cooperation has contributed to inclusive growth.

Although “inclusive development” is a relatively new term, the concept has deep roots. In one of its first appearances as a concept, Kuznets discussed links between economic growth and income inequality (Kuznets 1955). Two decades later, Ahluwahlia et al. (1974) made “growth with equity” a principal concern of the World Bank. This tradition continued with many later studies, including the World Development Report 2006: Equity and Development. More recently, several pioneering studies on inclusive development have been published, including Ali (2007), World Bank (2009), and AfDB (2012).¹ In these studies, the concept of inclusive development encompasses the provision of full, productive and decent employment to maximize economic opportunity; equal access to economic opportunity through development of human capital; and social safety nets to protect the chronically poor and vulnerable.² The Asian Development Bank has operationalized this concept through its Framework of Inclusive Growth Indicators (FIGI) (ADB 2013).

As Chap. 4 demonstrated, growth is more desirable and beneficial to societies if the benefits are widely shared. However, some people, some areas, and some sectors may be left behind, even during periods of rapid growth. Jobs can be a useful lens through which to examine inclusive growth. The World Bank’s World Development Report 2013: Jobs (World Bank 2012), stresses that jobs are a cornerstone of development, with benefits that extend far beyond income. The same report, however, also emphasizes that the benefits from jobs depend on the country’s level of development, demography, endowments, and institutions (190). It calls for an inclusive development agenda that differentiates between countries according to the challenges they face. Approximately 80% of the world’s extremely poor people live in rural areas and 60% work in agriculture (Chandy et al. 2015, 24). In countries with a high proportion of people under the poverty line, jobs and inclusive growth are of high priority in their “quality growth” agenda.

In this regard, diversification—building new firms and industries from scratch, and the expanding and upgrading existing firms and value-chains—is essential because it creates jobs and opportunities that allow people to participate in economic growth. People’s capacity to respond to new opportunities is a crucial prerequisite for job creation and the promotion of inclusive growth. In other words, the first two policy pillars of FIGI—developing productive jobs and economic opportunities and ensuring equal access to economic opportunities by expanding human capital—are intrinsically related.

A similar vision is presented in the report of the High-Level Panel of Eminent Persons on the Post-2015 Development Agenda (2013) (hereinafter, the HLP report) which gives priority to “creat[ing] opportunities for good and decent jobs and secure livelihoods, so as to make growth inclusive and ensure that it reduces poverty and inequality” (8). It also emphasizes educating, training, and providing people with skills to respond to the demands of businesses for workers and succeed in the job market (8–9).

Addison and Tarp (2016) discuss the relationship between transformation, jobs, inclusive growth and human security. This view is important because it suggests the intrinsic link between quality growth (with a strong focus on inclusive growth) and human security:

Structural transformation entails the creation of new sectors with greater value added than traditional sectors and the movement of capital (and especially labor) from low- to higher-productivity occupations. This in turn raises productivity and per capita income over time. Agriculture’s share of total output and employment falls (although agriculture’s total output may still grow as agricultural productivity rises). The economy diversifies away from commodity exports to manufactured products (and increasingly services) of rising skill-intensity, with more formal-sector jobs. Whereas improved basic service delivery can improve education and health outcomes at low levels of per capita income, sustained progress depends on growth providing additional resources. Successful transformation therefore helps to widen humanity’s fundamental freedom in all its forms³—a core tenet of Japan’s doctrine of human security [Kamidohzono et al. 2014]. (Addison and Tarp 2016, 298–299)

This chapter discusses strategies for jobs and inclusive growth in countries where extreme poverty is high, with a focus on sub-Saharan Africa. It begins by exploring why the need for inclusive growth is so great on the continent. It reviews the analytical drivers of the need for inclusive development. It also provides lessons from Asia and case studies of how development cooperation has contributed to inclusive growth. The East Asian experience has often been characterized as focused on labor-intensive manufactured exports; less well-appreciated is the role played by agriculture and agro-industrial links in ensuring that Asian growth was truly inclusive. The case study approach distinguishes this chapter from other literature that focuses on the general policy and institutional context for inclusive growth. Through case studies, we can see more clearly that inclusive growth is not something that happens automatically, but something that requires specific, properly designed strategies and approaches.

5.1 The Imperative of Inclusive Development in Sub-Saharan Africa

Every country has its own challenges to meet in order to achieve inclusive development, but three factors make this goal especially important and challenging in the African context: demographic transition, slow transformation of the economic structure, and natural resource curse.

5.1.1 Demographic Transition

In sub-Saharan Africa, the number of young people entering the labor force is growing rapidly. The working-age population (ages fifteen to sixty-four) in these countries will reach 616 million by 2030, a 74% increase from 353 million in 2010 (JICA Research Institute 2013, 74). This means roughly 13 million new jobs will be needed every year just to absorb these workers. In addition, the number of youths aged fifteen to twenty-four in Eastern, Middle, and Western Africa will double in the next forty years (2010–50) (73). Providing job opportunities for this growing working-age population, especially for young people, is one of the biggest challenges facing sub-Saharan Africa.

5.1.2 Slow Transformation of the Economic Structure

Chandy et al. (2015) argue that “Structural transformation is a catalyst both for raising labor productivity and for enabling poor workers to switch occupations” (17). However, “Among the constraints to the promotion of productive jobs is the absence of any significant change in the structure of most of the world’s poor economies, especially those in sub-Saharan Africa, despite the fact that many have recorded impressive rates of growth over the past decade” (17). Kanbur et al. (2019) confirm this view, pointing out that “On average, African growth was significantly faster during the first years of the new millennium. Annual growth approached 5% during this century, with six of the fastest-growing economies in the world during 2000–2010 … Most countries in the region lacked the structural transformation that is the hallmark of high-quality growth” (4).

Long-term trends in agricultural and manufacturing growth in sub-Saharan Africa have not been very encouraging. The industrial sector in sub-Saharan Africa employs only 10.6% of the overall labor force, and its share of GDP has been declining since the 1980s (Shimada et al. 2013, 175). Furthermore, sub-Saharan Africa’s share of the world’s manufactures and exports decreased from 0.4 to 0.3% and from 0.3 to 0.2%, respectively, from 1980 to 2005 (Dinh et al. 2012, 25). Rodrik (2013) warns about “premature deindustrialization” in developing countries, including many located in sub-Saharan Africa.

Increasing jobs in rural areas is one of the most promising avenues for inclusive development. Yet the amount of cropland per capita of the agricultural population in rural Africa decreased by 59% between 1960 and 2009 (Makino 2013, 77). What’s more, sub-Sahara Africa’s yields are lagging behind those in other world regions. Yield growth collapsed in the 1980s, and while they began to turn this around in the 1990s—especially after 2000—the rate of growth remains much slower than in Asia and Latin America (UNDP 2012, 31). This decrease in per capita cultivated cropland, together with stagnant or falling land productivity, resulted in a 13% reduction in per capita cereal production between 1961–63 and 2008–10, when per capita production rose by 44% in Asia and 48% in South America (Makino 2013, 77). Without growth in food production, rural incomes have faltered and few jobs in rural areas have been created.

Wage employment is not the most prevalent form of work in sub-Saharan Africa. Formal employment on average accounts for less than 10% of total employment (World Bank 2012, 191). Inclusive growth therefore has to consider how informal jobs are created in both rural and urban areas, where many jobs are now being created in services.

In short, the challenge of creating jobs facing sub-Saharan Africa cannot be underestimated: the expectations of many in the working population and the need to create entry-level jobs for young people must be reconciled within the context of slow or retrogressive economic transformation in which both premature de-industrialization and declining per capita cereal production restrict the creation of job opportunities.

5.1.3 Natural Resource Curse

Despite sub-Saharan Africa’s strong growth rate in the last decade, wage-paying jobs have grown only modestly. Part of the explanation for this lies in natural resource exploitation. The natural resource sector has been an important driver of recent growth, but creates few jobs and has narrow links to other economic sectors that are pivotal to poverty reduction. Indeed, the connection between resource sector growth, jobs and inclusive development hinges on how government rents are managed. History suggests resource-driven growth can easily exacerbate income disparities between the rich and the poor, especially where initial land and property ownership is unequal. This kind of growth may also contribute to social instability and consequently undermine the sustainability of growth itself.

5.2 Strategies for Inclusive Growth: The Asian Experience

Generally speaking, growth opportunities can be created by adding to endowments or by developing technology, know-how, and institutions that make those endowments more productive. The most common approach to inclusive growth is to provide policies and infrastructure that support growth across sectors, geographic areas, and households. Building transport networks that encompass remote populations and provide a connection to world markets, and investments in human capital are good examples. Institutional reforms to promote good governance, macroeconomic stability, the rule of law, and efficient administration are also relevant since they promote growth opportunities that do not discriminate. In order to transform economies to enable job creation and inclusive development, the HLP report envisaged triggering a virtuous circle of growth:

A second priority is to constantly strive to add value and raise productivity, so that growth begets more growth. Some fundamentals will accelerate growth everywhere—infrastructure and other investments, skills development, supportive policies towards micro, small, and medium-sized enterprises, and the capacity to innovate and absorb new technologies and produce higher-quality and a greater range of products. (HLP 2013, 9)

From this perspective, in sub-Saharan Africa, one promising proposal to increase jobs and inclusive growth could be the construction of growth corridors. The New Partnership for Africa’s Development (NEPAD) has advocated the creation of regional hubs and development corridors and poles, emphasizing linkages with mining, agriculture, tourism, and other economic activities (JICA/JBIC 2008).

As discussed in Chap. 2, Asia has had successful experiences in regard to inclusive job creation through the development of regional hubs and development corridors. The Greater Mekong Subregion (GMS) Development Program, which was launched by the Asian Development Bank (ADB) in 1992 with the participation of six countries in the Mekong region, is especially relevant. The aim of GMS was: “to implement poverty reduction and economic growth by creating a belt that would link impoverished inland areas with port cities, which have access to world markets” (JICA/JBIC 2008, 55). Electricity and communication infrastructure was developed in parallel with roads, bridges, and other transport infrastructure to support the agriculture, mining, and tourism sectors. A GMS Business Forum was established to facilitate collaboration between governments and the private sector. In Africa, in accordance with the framework of the TICAD VI (2016–2018), corridor developments are now being promoted (see Chap. 2).

Another potential vehicle for creating a virtuous circle of jobs and inclusive growth is “inclusive finance.” The HLP report states: “Financial services are critical to the growth of business, but also raise the income of individuals. When people have the means to save and invest, or get insurance, they can raise their incomes by at least 20%” (HLP 2013, 97). Financial institutions played an important role in encouraging inclusive growth in East Asia (Hosono 2013). East Asian governments created financial institutions to provide long-term loans at low interest rates, facilitating economic growth through industrialization and infrastructure development. At the same time, they encouraged inclusive development by providing credit to agriculture and small and medium firms. The World Bank’s East Asian Miracle, a notable study on the region’s dynamic growth, highlighted the following three aspects of its growth: governments created a wide range of financial institutions to fill perceived gaps in the types of credit provided by private entities; they addressed the need for long-term credit for industry by creating development banks; and most also created specialized institutions to provide credit to agriculture and small firms (World Bank 1993).

In ASEAN countries, SMEs and agricultural enterprises have generally been financed by public financial institutions and local commercial banks. These sectors have been crucial for inclusive development in the region. In Indonesia, earnings from oil and mineral resources were recycled through investments in agriculture and rural development, providing a basis for long-term economic growth. Crucial to success was the strategy of combining supply-side support measures—such as provision of high-quality seeds, chemical fertilizers, irrigation infrastructure, and agricultural finance—with demand-side support measures, including producer price support to improve agricultural productivity (JICA/JBIC 2008, 40). In Thailand and Malaysia, small and medium enterprises were developed to support the establishment of a competitive automobile industry (JBIC 2001).

5.3 Strategies for Inclusive Growth: A Case Study Approach

In this section, I present case studies illustrating three broad strategies for enabling inclusive growth that go beyond the general approaches to nondiscriminatory growth described previously. The first strategy is to increase the level of food production and smallholder productivity. This strategy directly raises rural incomes, thereby providing immediate benefits from growth. Indirectly, it leads to inclusive growth by helping to decrease food prices and raising real wages or employment levels in nonfood sectors. This strategy is most suitable for countries that have solid potential for increasing cropland, irrigation, and application of modern technologies that can improve yields.

The second strategy is to promote agricultural diversification toward higher value-added crops in a way that creates an agro-industrial value chain or a food value chain. This strategy is relevant for countries that continue to have large population shares in rural areas, as is the case in most low-income countries. Cramer and Sender’s concept of “industrialization of freshness” or “industrial agriculture” is closely related to this strategy. Their concept “matters to low-income (and middle-income) developing countries because of the huge scope for productivity growth, export revenue growth, and employment creation in industrial agriculture” (Cramer and Sender 2019, 211).

The third strategy is to focus on industrialization for domestic and export markets. I demonstrate that sub-Saharan Africa has important differences in labor market structure compared to East Asia, and so cannot necessarily rely on low wages as a determinant of competitiveness. However, a structured approach can still deliver competitive industries in selected subsectors.

5.3.1 Strategy 1: Increasing Staple Crop Productivity

Both India and sub-Saharan Africa were trapped in a low-income equilibrium in the 1970s. However, India succeeded in escaping from it, and the two regions diverged significantly in the 1980s (Fujita 2010, 18–19). The breakthrough that enabled India’s achievement was the second wave of the Green Revolution. The first wave, which occurred from the mid-1960s through the 1970s, was limited to increasing wheat yields in the northwest and in small delta regions of peninsular India (6–7). The second wave unleashed a rapid increase in rice production during the 1980s that was fundamental to the economic development of hitherto poverty-stricken rural areas. India achieved strong agricultural growth that spread across almost all regions and almost all its major crops.

The most important factor supporting rapid agricultural growth during the 1980s was the widespread diffusion of private tube wells for irrigation, especially small-scale, shallow tube wells, which enabled a highly productive system of double cropping of high-yield varieties (HYV) of rice and wheat over broad rural areas and double cropping of HYV rice in areas with plentiful rainfall. Based on a comparative analysis of India and sub-Saharan Africa, Fujita (2010, 19) concludes that

The most important lesson for sub-Saharan Africa from the Indian experience, therefore, is that it should take steps to raise rural incomes and thereby to strengthen rural markets for non-agricultural products and services. Once this has been realized, sub-Saharan Africa will be in a position to proceed to the next stage of economic development: industrialization. To raise rural incomes to a certain level, productivity growth in agriculture should be increased, especially in terms of staple food output, rather than the horizontal expansion of farmland that has been the practice in most of sub-Saharan Africa. This argument is basically in line with that of Eswaran and Kotwal (1994).

At least two aspects of India’s transformation since the 1980s deserve special mention. First, the Green Revolution in India did not take place solely because of the introduction of high-yield varieties of crops. It took decades of incremental and sustained agricultural development following the country’s independence for the benefits of the Green Revolution to be realized. Second, the remarkable increase in yields was achieved by combining the planting of HYV crops with increased use of fertilizer and irrigation. The availability of affordable fertilizer and the widespread diffusion of private tube wells for irrigation were essential (Yanagisawa 2014, 117–127). The remarkable nationwide increase in India’s agricultural productivity and subsequent changes in rural society have helped enable India to achieve prolonged growth in its domestic and export markets since the 1980s. Those developments prepared India to respond competitively to globalization and the economic liberalization policies introduced after 1992, which led to India’s successful integration into the world economy (10).

The experiences of Bangladesh also are highly relevant for sub-Saharan Africa. The major factors that changed the rural society of Bangladesh include the rapid spread of microfinance, the construction of rural infrastructure, and the modernization of agriculture based on the adoption of new technology, which enabled farmers to shift from low-yield, single-crop, deep-water rice to high-yield, double-crop, short-maturity rice. Increasing land and labor productivity in rice agriculture in the early 2000s had beneficial effects on the agricultural average wage and hence on rural poverty (Hossein et al. 2012, 6).

The changes in rural society in Bangladesh have been profound. As discussed in Chap. 3, higher labor productivity in agriculture made it possible for the massive employment of female workers in the garment industry in two big cities, Dhaka and Chittagong. Bangladesh is an example of a country that was able to rapidly urbanize and integrate into the world economy by absorbing unskilled labor into light-manufacturing industries (World Bank 2012, 197).

In the case of Bangladesh, several factors interacted to bring about that change, including investments in rural roads, irrigation, market facilities and other rural infrastructure, microcredit, and education. This enhanced the mobility and availability of low-opportunity-cost labor in rural Bangladesh.

Hossein et al. (2012) contend that in any predominantly agricultural economy that has high population growth and density, the critical challenge is to reduce the burden of surplus labor in agriculture—a “challenge that can be met through sustained sectoral and social policies and attendant institutional changes commensurate to each stage of development to support productivity/growth-enhancing relocation of ‘surplus’ farm labor to non-farm and non-agricultural jobs” (4; italics in original).

Chapter 3 highlighted the transformation of Bangladesh. In 1981, ten years after Bangladesh achieved independence, raw jute and jute goods constituted 68% of the country’s total exports. Thirty years later, in 2011, garments accounted for 76% of total exports and textiles for another 9%. Businesses in these sectors accounted for 50% of all manufacturing establishments in the country (UNCTAD 2012, 11). Today, the garment industry encompasses 5000–6000 factories with 7–8 million workers using assembly-line production methods. The wages of workers in this industry are around 35% higher than the national average (see Chap. 3). The Bangladesh success story is even more remarkable because, as a recent World Bank study highlighted, “the country was often held out in the development literature as a hopeless case” (World Bank 2012, 197).

These South Asian experiences demonstrate that increasing rural incomes is crucial for structural transformation and that a key factor in achieving transformation is increasing staple food productivity. Although an Asian-type Green Revolution has not been realized in sub-Saharan Africa, several remarkable increases in staple food productivity have been observed. There is significant potential to focus on rice because the gap between production and consumption of rice in sub-Saharan Africa has been growing. Currently, 40% of the rice consumed is imported. The Economist stated that “in Africa, where a third of the population depends on rice, demand is rising by almost 20% a year. At that rate, rice will surpass maize as Africa’s main source of calories within 20 years” (Economist 2014, 21). Another reason to focus on rice is that rice cultivation is where the technological gaps (or “yield gaps”) between sub-Saharan Africa and India and other Asian countries are especially high. The average yield gap for rice is similar to that of wheat and much larger than the modest yield gap for maize. There is no yield gap for sorghum and millet production (Otsuka 2013, 26).

Furthermore, rice could be considered an entry point for increasing productivity in the agricultural sector as a whole since, in most sub-Saharan African rice-producing countries, those working in the rice value chain are involved in other important crops as well (Kubota 2013, 10). General measures—such as strengthening the capacity of institutions and individuals for research and extension—benefit both rice and other crops. It might be thought desirable to pay more attention to maize because it is the principal subsistence crop among poor African farmers. However, as Otsuka (2013) states, “the prerequisite for a maize Green Revolution is the development of truly profitable and productive maize seeds and farming practices for this crop” (36). In other words, maize is not yet at a stage where research has developed seeds appropriate for Africa’s ecology. That may come as a second wave of an African Green Revolution.

The public sector must be in the vanguard. Its efforts to invest in the development and dissemination of high-yield varieties are essential for increasing rice production. As explained by the World Bank (2012), since farmers can reproduce varieties of rice, private seed companies cannot reap the benefit of introducing new varieties and so tend not to make the effort (191–192).⁴ Moreover, the costs of other basic necessities for food crop agriculture need to be reduced to make them affordable to small farmers. For example, the cost of fertilizer in sub-Saharan Africa is roughly double the cost in Asia.⁵

Addressing post-harvest losses (PHL) is another challenge. The World Bank (2011) estimated that the value of PHL in sub-Saharan Africa could reach nearly US $4 billion a year out of an estimated value of US $27 billion in total annual grain production. This is equal to the annual value of cereal imports of sub-Sahara Africa (xiii). The Bank emphasizes the importance of a value chain approach to identifying optimal interventions for reducing PHL losses.

5.3.1.1 Case 5.1: Agricultural Sector Development Program and Related Initiatives in Tanzania

The Agricultural Sector Development Program (ASDP), started in 2006, was the Tanzanian government’s main agricultural initiative in the first decade of the 2000s, with some 60% of the agricultural sector budget going to the program in its first four years (Therkildsen 2011, 14). ASDP’s aim is to increase productivity in the agricultural sector, increase agricultural incomes and food security, and alleviate poverty. ASDP has several distinctive features. Its largest component is irrigation, which accounts for some 80% of the total budget. Crucial elements in the program are both the empowerment and development of the capacities of farmers and the decentralization of implementation by providing local authorities with funds through central government transfers based on their performance (14–15). Several donors participate in ASDP, and it has become one of the first sector-wide approaches to agriculture in Africa.

Since the launch of the program, land under irrigation has increased by 15,000–20,000 ha per year, from a total of 264,000 ha in 2006 to 332,000 ha in 2010. That result is less than planned under ASDP, but is still a considerable achievement (Therkildsen 2011, 20). After 2011, per-year expansion increased to 30,000. The estimate of land under irrigation was 461,000 ha in 2013.⁶ This increase is the result of enhanced technical capacity (irrigation institutions and individual technical irrigation officers), the government priority given to irrigation, and other factors, including small-, mid-, and large-scale irrigation development funds.

Within ASDP’s capacity development initiatives, emphasis is placed on improving the technical capabilities of central and local governments and farmer groups, and increasing the number of technical personnel such as central and local government engineers, technicians, and surveyors. At the same time, rice cultivation technology has been disseminated through the Technical Cooperation in Supporting Service Delivery Systems of Irrigated Agriculture program (Tanrice).⁷ Tanrice is implemented by specialized training institutes,⁸ providing training on irrigated rice farming for more than 40 irrigation schemes and 13,000 families. It covers a package of basic farming techniques, such as ridge management (enclosing paddies with low mud walls, or bunds), field leveling, straight-row planting (planting in straight lines and at specific intervals), use of handmade weeding machines, irrigation scheme management for women, and rice marketing. The training also includes the dissemination of NERICA (New Rice for Africa) varieties among key rice stakeholders.

Tanrice is based on the technologies, practices, and experiences in farming in the Moshi Rural District in the Kilimanjaro Region, where the resulting rice yield has already reached 6 tons per hectare due to improved farming techniques and irrigation, easily outpacing the national average, which is about two tons per hectare. The Kilimanjaro Agricultural Training Center (KATC) has played a key role since the 1990s, helping to augment that success by establishing and implementing various training programs for agricultural extension officers, irrigation technicians, and farmers.

Tanrice has been an important factor in the Tanzanian government’s National Rice Development Strategy, launched in 2009, which aims to double rice production to 1.96 million tons by 2018 (from production in 2008) through the intensification of irrigated paddy production. During this period, yield per hectare is intended to increase from 2.13 to 3.5 tons in irrigated areas and from 1 to 2 tons in rain-fed lowlands.

Based on the achievements of Tanrice, the Project for Supporting Rice Industry Development in Tanzania (Tanrice 2) was initiated in November 2012. This project aims to further disseminate rice-farming technologies nationwide in partnership with seven agricultural training institutes. As rain-fed cultivation also needs to be improved to have the maximum impact on poverty reduction, approaches for disseminating the appropriate rain-fed rice cultivation technologies are being explored. This project also aims to promote the value chain of the rice industry.

There has been a significant increase in the proportion of crop-growing households receiving crop extension advice. The percent of total crop-growing households receiving advice on crops from government extension staff increased from 33% during the agricultural year 2002–03 to 60% in 2007–08. Meanwhile, the proportion of households receiving extension advice from NGOs or development projects increased from 5.3 to 7.9% (ASDP Monitoring and Evaluation Working Group 2011, 20). Positive changes have consequently been recorded in agricultural exports; the production or productivity (yield) of maize, rice, meat, milk, and eggs; and the proportion of farmers using improved seeds or chemical fertilizer and adopting mechanization (tractors and power tillers). ASDP is reported to be on track to achieve its objectives. The rice industry in Tanzania has grown rapidly over the last decade and is now largely self-sufficient. Local production meets 92% of consumption, despite a 21% price premium over imported rice because of the higher quality of local rice, which is aromatic, fresh and clear (Bill and Melinda Gates Foundation 2012).

ASDP’s achievements are encouraging and offer an interesting experience to be shared among sub-Saharan countries. As Otsuka (2013) concludes, “It is clear that a combination of improved seeds, improved production practices, and irrigation leads to significantly high yields, resulting in a ‘mini’ Green Revolution in Tanzania” (29).

5.3.1.2 Case 5.2: The Coalition for African Rice Development Initiative

The Coalition for African Rice Development (CARD) was launched by the Alliance for a Green Revolution in Africa (AGRA) and the Japan International Cooperation Agency (JICA) in 2008 as an international platform for promoting rice development⁹; its initial goal was to double rice production in Africa in ten years. Since its inception, CARD has promoted the entire value chain, such as extension, production, post-harvest handling and marketing, through technical and financial cooperation and research activities in collaboration with other development partners. CARD has twenty-three African member countries: a first group of twelve countries where the importance of rice is relatively high, and a second group of eleven countries that are rapidly increasing their consumption of rice. These new member countries joined CARD later, as mentioned below.

Within the CARD framework, each country has drawn up a National Rice Development Strategy (NRDS). Additionally, a task force has been set up in each country, where stakeholders jointly produce a list of prioritized possible interventions (Kubota 2013). The development partners in CARD have agreed to jointly support the formulation and implementation of national strategies by drawing on their own comparative advantages and seeking out synergies across their interventions. JICA alone was implementing around sixty projects as of August 2012.

In 2008, the first group of twelve rice-producing sub-Sahara African countries and seven development partners jointly endorsed CARD’s overall target of doubling rice production in sub-Sahara Africa in ten years from 14 to 28 million tons in 2018. The twelve countries accounted for about 85% of total rice production in sub-Saharan Africa as of 2008. A positive yield trend from 1.7 tons per hectare in the base period to 2.0 tons per hectare in the next five-year period was observed, which is the fastest yield improvement in the past few decades in the region, while still falling far short of yield rates in many Asian rice-producing countries (Kubota 2013, 20). Production of 26.14 million tons was achieved in 2016. As of March 2018, the skills of rice cultivation have been disseminated to 48,207 farmers and 3299 extension workers (JICA 2019a, 8).

Notable progress has been observed in the partnership among African rice-producing countries and their five Asian partners, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam. CARD has organized a series of dialogues between African and Asian parties that have been instrumental in making development partners’ interventions more flexible and wider in scope. For example, most of the rice-related projects formulated and implemented by JICA since the start of CARD in 2008 have a market orientation and components relating to post-harvest losses.

CARD achieved its target of doubling rice production in 2018. CARD Phase 2 started in 2019, with a renewed target of further doubling rice production in sub-Sahara Africa, from 28 to 56 million tons by 2030. In Phase 2, nine new member countries, and a new partner, the World Food Program (WFP), joined CARD. In order to achieve this target, CARD introduced the “RICE approach” based on the outcomes of past development cooperation. RICE approach consists of four activities: (1) Resilience, through addressing climate change and population increase; (2) Industrialization, by nurturing local industries based on rice in cooperation with the private sector; (3) Competitiveness, by improving the quality of local rice to compete with imported rice; and (4) Empowerment of farming families by improving their livelihood through the development of a production management system (JICA 2019b).

5.3.2 Strategy 2: Diversification of Agriculture to Include Higher-Value Crops and Enhancement of the Agro-Industry Value Chain

The feasibility of commercial crops is high in some areas because of geographic and/or climatic conditions, including access to consumers and export markets. In most Southeast Asian countries, diversification to high-value crops and development of commercial agriculture has advanced inclusive growth. An example is Thailand, whose “newly agro-industrializing country” (NAIC) strategy became part of the country’s economic development plan in the 1980s. The strategy aimed to establish the country as a net exporter of food as a basis for promoting industrialization.¹⁰ In addition, it encouraged the development of agro-industry as an export industry based on Thailand’s past achievements in exporting primary products.

Thailand has traditionally produced rice and natural rubber for export, but in the 1970s, it diversified to include tapioca and maize. With the introduction of modern quality control and production technologies, the list of export products continued to grow in size and diversity to include broiler, grilled, and skewered chicken; farmed prawns; tinned tuna; tinned fruit; and natural rubber. Specific measures adopted by the government to support this process included provisions for preferential investments for agro-industry and flexible financing by commercial banks for agriculture-related businesses.

5.3.2.1 Case 5.3: Smallholder Horticulture Empowerment Project in Kenya

Like Thailand, Kenya has considerable potential for commercial agricultural diversification thanks to good market access and the capacity of its farmers. As discussed in Chap. 4, the Smallholder Horticulture Empowerment Project (SHEP) was launched in 2006. Key components of SHEP include the introduction of market-oriented agriculture, based on market surveys, stakeholder forums, and demand-driven technical training. In 2010, encouraged by the effectiveness of the model, the Kenyan Ministry of Agriculture set up the Smallholder Horticulture Empowerment and Promotion Unit (SHEP Unit) (Aikawa 2013, 144–145). Since 2013, Kenya has been decentralized. Local governments, referred to as “counties,” are now the main actor in implementing the SHEP approach. Under these circumstances, the “Smallholder Horticulture Empowerment and Promotion Project for Local and Up-scaling: SHEP PLUS” has been introduced from 2015 to 2020, aiming to assist local governments in improving and customizing the SHEP approach. Through this project, it is expected that the local governments will be able to manage their resources, such as budget and human resources, to incorporate the SHEP approach into their agriculture extension systems (JICA n.d.).

SHEP’s main goal was to develop the capacity of smallholder horticulture farmer groups to raise their incomes. According to the SHEP final monitoring survey, carried out in October 2009, average horticulture-related net income among the 114 beneficiary farmer groups increased by 67% over the baseline while the average net income per-farmer increased by 106%.¹¹ While incomes increased for both men and women, the gap between them fell from 31 to 15% over the project’s duration (Aikawa 2013, 151).

Aikawa (2013) submits that the skills of farmers improved significantly because they were empowered to conduct market surveys and to freely determine their target crops based on the survey results. This motivated the farmers to learn techniques more thoroughly during in-field training. When the farmers succeeded in marketing their products, their success further reinforced their sense of competence and motivation. This positive interaction between enhanced intrinsic motivation and increased skill levels provides a powerful model for sustained growth (see Chap. 4).

SHEP started with the premise that horticultural farming is an industry, no matter how small the scale of the market as a whole or how little the output of individual farmers. Based on that premise, the projects developed a series of activities designed to encourage farmers to develop the capacity to respond to the needs of the market, using these as both the starting point of their strategy and their ultimate goal. Many African countries are encouraging their farmers to transform their current subsistence-oriented agriculture into more explicitly commercially oriented ventures. However, small-scale farmers in Africa did not necessarily know how to achieve this, though they had been practicing farming based on rational decision making, just as in a business. SHEP filled this gap (Aikawa 2013, 163–164).

Since the 1990s, many donors have been providing support for value chain development. Their support tended to focus on the downstream part of the supply chain from production through sales, or the portion close to postharvest processing and sales. In contrast, SHEP provided support to small-scale farmers through every step, from production to sales, covering various aspects of the activities in ways that were adoptable by the farmers. In doing so, the project always put the farmers at the center as it designed its activities and refined its methods (Aikawa 2013, 163–164). Based on these factors, SHEP achieved remarkable results.

At the Fifth Tokyo International Conference on African Development (TICAD V) held in June 2013, SHEP’s region-wide development program was billed as a key approach in the future of agriculture in Africa for its success in boosting the incomes of small-scale farmers. The SHEP approach has currently spread to 23 countries in the African region, as well as Palestine and El Salvador. Between 2013 and 2017, 4330 technical staff members and 60,381 farmers were trained in Africa (JICA 2019a, 3).

5.3.2.2 Case 5.4: Diversification Through Agroforestry in Semi-Arid Kenya

About 83% of Kenya is covered by arid and semi-arid land (ASAL), which is vulnerable to global warming and climate change. These areas are also characterized by a high incidence of poverty.¹² Increasing staple crop productivity in these environments is difficult, if not impossible. Preventing the desertification of ASALs while reducing poverty requires fostering an inclusive green economy, as well as enhancing community resilience against drought.

Kenya relies on firewood and charcoal for more than 70% of its total energy consumption and about 90% of the energy consumption in homes. The increasing demand for firewood and charcoal—resulting from the doubling of the population in the last twenty years—overgrazing, and disordered cultivation have devastated forest areas. That devastation has not only greatly reduced the supply of firewood and charcoal but also resulted in a decline in the productive capacity of Kenya’s land. In order to address these issues, in 1982, the government set targets for the production of 200 million seedlings a year in a strategy established by presidential order to increase rural tree growth. In June 1986, the Kenya Forestry Research Institute (KEFRI) was established as a parastatal institution. In 1994, the Ministry of Environment and Natural Resources of Kenya launched the Kenya Forestry Master Plan 1995–2000 (KFMP), which identified farm forestry as an important model for forestry development.¹³

Through the farm forestry model, with KEFRI as an implementing agency, local people were entrusted with the management and ownership of forestry resources. Basic tree nursery and tree planting technologies were strengthened. The Farmer Field School (FFS) approach, an existing and proven extension model in the agricultural sector, was adapted to forestry, through which techniques for seedling production, fruit tree planting (mango, grevillea, and others), poultry raising, vegetable cultivation, compost use, and woodlot creation were disseminated.

FFSs have promoted ownership, strengthened communities, and increased farmers’ capacities by sharing knowledge about forestry. Beneficiary farmers and farmer groups have started to sell forestry products such as mangoes, seedlings, lumber, and firewood. FFSs have recently created networks to carry out market surveys, and Kenya Forestry Service and Equity Bank are facilitating farmers’ production and marketing activities through the Support to Community-Based Farm Forestry Enterprises in Semi-Arid Areas of Kenya Project (SCBFFE). In this way, an increasingly self-sufficient agroforestry industry is being developed.

Through these activities, farmers are increasing their awareness of methods to improve their livelihoods. Wider extension activities are expected as graduate farmers from FFSs share advice with farmers in surrounding areas, leveraging and strengthening social capital in the sector. At the same time, technological research to identify drought-tolerant tree species is being carried out at KEFRI.

These experiences in the semi-arid regions of Kenya demonstrate the possibility of creating opportunities for inclusive and sustainable growth while coping with the impacts of deforestation and climate change, as discussed in detail in Chap. 7.

5.3.3 Strategy 3: An Industrial Strategy with Links to Agriculture Development

Agricultural development alongside industrialization has taken place in most Asian countries, including the apparel industry in Bangladesh and the agro-industry in Thailand, as described earlier. Vietnam, one of the latecomers to industrialization among ASEAN countries, has achieved impressive progress. Its government has adopted a strategic approach since 2000, emphasizing the importance of domestic and foreign capital mobilization and rural and agricultural development along with industrialization and fostering the growth of small, medium and microenterprises, as well as heavy industry.¹⁴

Sluggish development of agriculture in sub-Saharan Africa has constrained industrialization in multiple ways—for example, by increasing the prices of agricultural inputs, and limiting the expansion of the consumer market in rural areas. The transition from an agrarian economy to an early industrializing economy or an urbanizing economy involves important interactions between rural and urban growth. The World Bank (2013) states that rural growth in Asia helped to lower food prices and real wages for urban areas and created demand for urban goods (102). It can also contribute substantially to export competitiveness and manufacturing growth.¹⁵ Higher food prices partially explain the high wages for formal labor in sub-Saharan Africa compared to those in several East and South Asian countries. For example, in 2006–7, annual wages among manufacturing industry workers in Kenya ($3012) were higher than in Thailand ($2223) and those in Tanzania ($1709) were higher than in Indonesia ($1667) (Hirano 2013, 136). This is despite GDP per capita in Kenya and Tanzania being significantly lower than Thailand and Indonesia.

A more robust comparison requires an assessment of comparative skill levels across countries. This has been attempted by Dinh et al. (2012). They found that skilled and unskilled workers’ monthly wages in Ethiopia were significantly lower than wages in Vietnam, while wages in Tanzania and Zambia were generally higher or the same as those for the equivalent labor in Vietnam but lower than in China (27). Hirano (2013) concludes that, while the level of wages in sub-Saharan Africa is not overwhelmingly lower than in some East and South Asian countries, there is great potential for the continent to become competitive in terms of wages in some light-manufacturing sectors.

Several measures to increase labor productivity could be carried out to overcome the disadvantage related to wages: human resource development to improve education and skill levels; infrastructure development to reduce energy and transportation costs; further regional integration to get better access to neighboring countries’ markets; formation of business clusters and deepening of value chains to obtain economies of agglomeration, scale, and scope; improvements in management skills; and the introduction of Kaizen, the Japanese practice of continuous improvement of quality and productivity at the plant level.

Similarly, lowering the cost of production as well as increasing the quality of agricultural inputs for agro-industry and light manufacturing is essential for the formation of agro-industrial value chains. Dinh et al. (2012) emphasize that with inputs accounting for more than 70% of the total cost of light-manufacturing products, small variations in the prices paid for inputs can wipe out any labor cost advantages that a country may have (57).

Given this backdrop, in order for manufacturing industries to become competitive in export and domestic markets, a structured and coordinated approach for industrial strategy, which fully takes into account relationships between agriculture and manufacturing, appears to be crucial. At the same time, different pragmatic efforts are necessary to improve efficiency and competitiveness, such as (1) the promotion and facilitation of exports and foreign direct investment, with spill-over effects for technological transfers; (2) the formation of human resources, especially of skilled workers, engineers and other industrial personnel; (3) the formation of clusters in which the effects of agglomeration can be attained; (4) the improvement of productivity and quality through Kaizen; and the (5) enhancement of management capacity of entrepreneurs, among others.

To add to this understanding, Case 5, a structured approach for industrial strategy in Ethiopia, Case 6, Kenya’s comprehensive approach for export promotion, and Case 7, initiatives for introducing Kaizen in Africa, are discussed below.

5.3.3.1 Case 5.5: Agricultural Development–Led Industrialization in Ethiopia

The industrial strategy of the Ethiopian government has been in place for more than two decades. Beginning in 1995, the concept of Agricultural Development-Led Industrialization (ADLI) was incorporated into the first and the second national development plans. ADLI initially targeted smallholder farmers. A rise in agricultural output was expected to stimulate industrial production by providing food and industrial materials, thus establishing a link between the rural and urban sectors. In turn, the industrial sector can produce inputs to agriculture, such as fertilizers and farming tools and equipment, as well as consumer goods for rural households (Ohno 2013, 271–272). Ohno (2013) calls this dynamic linkage Core ADLI. He states that the Plan for Accelerated and Sustained Development to End Poverty (PASDEP) 2005/06–2009/10 broadened the policy scope from smallholder agriculture to other sectors, especially industry and the urban sector. “In what may be called Enhanced ADLI, strong emphasis was placed on growth acceleration, which was to be attained through commercialization of agriculture and private-sector development” (Ohno 2013, 272, italics in original).

The expansion of agricultural extension services, mainly occurring during this PASDEP period, was remarkable. Ethiopia had finished training and assigning three specialists responsible, respectively, for agricultural technology, livestock management, and resource utilization in every village of the country, with 61,785 agricultural extension workers trained as of January 2010. A farmers’ training center was also established in every village. The total number of centers amounted to 9265 as of 2010. As Ohno (2013) points out, “Comprehensive national extension networks such as this are relatively rare in Africa” (280). In the PASDEP period of 2005/06–2009/10, industrial performance was less than expected. Real GDP grew an impressive 11.0% per annum, but this was a result of over-achievement of agriculture (8.4% against the base-case target of 6.0%) and services and underachievement of industry (10.0% against the base-case target of 11.0%) (Ohno 2013, 293–294).

In the framework of the Growth and Transformation Plan 2010/11–2014/15, industry was expected to be the major source of employment and foreign exchange by broadening the economy to include import-substitution industries, as well as export-oriented industries. In addition, new measures have been introduced to promote micro- and small enterprises, while eight selected medium- and large-scale industries are being actively promoted (textiles and garments, leather and leather products, sugar, cement, metals and engineering, chemicals, pharmaceuticals, and agro-processing). Additional policy instruments, such as the institutionalization of Kaizen, enhancement of the technical and vocational education and training system, and creation of industrial zones, were also employed (Ohno 2013, 294). Throughout this process, the Ethiopian government has incorporated the diverse experiences of East Asian economies.

5.3.3.2 Case 5.6: Export Promotion in Kenya

Kenya’s exports have traditionally concentrated on tea, coffee, petroleum products, and cement, although the country has recently begun expanding into nontraditional export industries such as commercial vessels and assembled automobiles and motorcycles. The promotion and diversification of exports have been among the main pillars of the Kenyan government’s development strategy. In the past, the government implemented various export promotion measures, including the establishment of export processing zones, a partial reduction in sales taxes for the manufacturing industry, and the liberalization of exports and foreign exchange. However, these efforts failed to address the binding constraints to exports, such as inadequate infrastructure and insecurity (JICA/JBIC 2008).

Against that backdrop, an export promotion master plan was formulated, leading to the establishment of the Export Promotion Council in 1992. In 1997, the Kenyan government published a document titled “Industrial Transformation to the Year 2020,” envisaging Kenya being among a select group of Newly Industrializing Economies (NIES) by 2020. To achieve this target, an Economic Recovery Strategy Paper was published in 2003, proposing wide-ranging policy measures. Under this framework, the Private Sector Development Strategy (PSDS), the Master Plan Study of Kenyan Industrial Development, and other initiatives have been carried out.

PSDS started officially in 2007 with five strategic goals: to improve the business environment; promote administrative reforms; develop the capacity of the trade sector through industrial development and trade promotion; increase productivity; and promote micro-, small, and medium enterprises. This strategy was implemented with the support of seventeen donors, coordinating 150 projects.

In view of the increased need for strengthening human resource capacity amid enhanced calls for export promotion, a program to build the capacity of small-scale exporters was implemented in 2007. It was designed to strengthen the trade-related business skills required of Kenyan exporters and the staff of the Export Promotion Council. This program is expected to contribute to the long-term goal of establishing Kenya as an economic hub for surrounding countries and create a strong export-oriented economic structure (JICA/JBIC 2008, 62).

5.3.3.3 Case 5.7: Introducing Kaizen into Sub-Saharan Africa

In 2009 a pilot project aimed at increasing productivity and improving quality (Kaizen) at small manufacturing plants started in Ethiopia with the support of the Japan International Cooperation Agency (Shimada et al. 2013, 187). The initial results of this project were promising: over six months, the thirty firms that introduced Kaizen obtained an average benefit equivalent to US $30,000, while the highest benefit achieved by a single company was around US $200,000. With an average of 402 employees per participating company, the pilot project generated benefits of US $74 per employee, which almost equaled the gross monthly wage of US $75 that prevailed at the time (Shimada et al. 2013, 184). The pilot project ended in June 2011. Encouraged by that achievement, in October 2011, the Ethiopian government established the Ethiopian Kaizen Institute (EKI) under the Ministry of Industry, with sixty-five technical staff. The Ethiopian government and JICA began the Phase 2 Kaizen Project in November 2011 in order to build the capacity of EKI and related organizations to disseminate Kaizen throughout the country.

EKI, the main promoter of Kaizen activities in Ethiopia, provided training to 68,954 trainees and established 9,658 Kaizen Promotion Teams (KPT; a customized version of the Quality Control Circle (QCC) in Ethiopia) in 473 target institutes from 2012/13 to 2016/17 (Jin 2020, 96). It continues to provide training and consultations directly to large and medium enterprises as well as training for micro and small enterprises through Technical Vocational Education and Training (TVET). EKI estimated that the benefits of Kaizen implementation between 2011 and 2016 reached 2169.5 million birrs, equivalent to US $105 million (Mekonen 2018; Jin 2020, 96). The projects on capacity building for dissemination of Kaizen that were implemented in Ethiopia from 2009 to 2014 demonstrated productivity per unit time increased by an average of 37.2% (JICA 2019a, 2). Following the satisfactory results of Kaizen promotion, the government incorporated Kaizen dissemination into the country’s five-year development plan (2015–2020). From 2016, the Technical Cooperation Project on Capacity Development for Kaizen Implementation for Quality and Productivity Improvement and Competitiveness Enhancement started in Ethiopia. Similar projects are ongoing in Egypt, Tunisia, Ghana, Cameroon, Kenya, Tanzania and Zambia.

JICA’s assistance in promoting Kaizen dates back to 1983, when it commenced a project in Singapore (Chap. 3). Over twenty-nine years (1981–2008), Japan employed a range of different cooperative efforts to introduce Kaizen in 46 countries (Ueda 2009). Moreover, JICA has been providing support for Kaizen projects specifically aimed at industrial sectors in around 30 countries. As for African countries, Kaizen-related technical cooperation projects have been carried out in eight countries since the first project in Tunisia was implemented in 2006. Various lessons have been learned, such as the need to ensure the commitment of high-level government officials, the need to establish and maintain a strong Kaizen promotion organization and system, and standardization of an approach to ensure the quality of Kaizen promotion personnel (JICA et al. 2018). To further accelerate industrial development through dissemination of Kaizen in the African continent, in 2017, JICA launched the Africa Kaizen Initiative (AKI) in collaboration with the New Partnership for Africa’s Development (NEPAD) Planning and Coordinating Agency, a technical body of the African Union (AU).

5.4 Concluding Remarks

This chapter has argued that three strategies are relevant for supporting inclusive growth in the agrarian economies of sub-Saharan Africa: increasing the productivity of staple food crops, diversifying agriculture to higher-value crops while building stronger agro-industry value chains, and promoting light-manufacturing industrialization in conjunction with agricultural development. The total process constitutes a structural transformation that could be triggered, sustained, and accelerated by investments in infrastructure, human capital, technology, and inclusive finance. These strategies for promoting jobs and an inclusive growth agenda are mutually reinforcing but must be explicitly articulated. It is clear from past experiences in sub-Saharan Africa that jobs and inclusivity do not necessarily accompany the growth of GDP alone.

The case studies described above show, first of all, that many successful experiences have confirmed the feasibility of rapid, inclusive growth in sub-Saharan Africa. Second, they show that human capacity development, especially of farmers, workers, and SME entrepreneurs, is essential. There is a strong interrelationship between the creation of job opportunities on one hand, and people’s capacity to respond to those opportunities on the other. Capacity development is needed for people as well as institutions. Third, in the seven cases studied, different measures were taken to scale up the impact of programs. Pilot projects have been scaled up to cover geographically wider areas, diversify activities, and disseminate proven technologies and practices from the local to the regional and national levels. In some cases, they have been shared with other countries through South-South cooperation. In many of the cases, the roles of government, public institutions, and public–private partnerships have been important.

The cases studied here should not be taken as “best practices” that can be readily supplanted to other countries. Most interventions require careful adaptation to local conditions. Nor are they all of the same level of importance or priority. For example, of the various strategies, improving the productivity of small farms should be the highest priority. However, strategies to develop jobs, build human capacity, and create inclusive growth opportunities must fully take into account local socioeconomic and natural conditions—especially in agriculture—due to the characteristics of natural capital on which they depend. As the HLP report put it, “there is no single recipe” for developing a jobs and inclusive growth strategy (HLP 2013, 9).

Notes

• 1. For a discussion on inclusive growth from a “learning perspective,” see Chap. 4.

• 2. This definition is similar to Ali’s “three pillars of inclusive growth: (1) Full, productive and decent employment to maximize economic opportunities; (2) social protection to ensure minimum economic well-being; and (3) capability enhancement to ensure equal access to economic opportunities” (2007, 13).

• 3. Human security refers to the safeguarding of people’s freedom from fear and want, ensuring that they can live in safety and dignity.

• 4. In contrast, hybrid seeds of maize, sorghum, and millet cannot be reproduced by farmers; hence, the private sector supplies seeds, although public support is necessary to develop biological and chemical technologies (World Bank 2012).

• 5. This is roughly true for nitrogen, potassium and phosphate fertilizers (Hirano 2013).

• 6. Project for Irrigation Human Resource Development by Strengthening the Capacity of Arusha Technical College: http://www.jica.go.jp/tanzania/office/activities/project/44.html.

• 7. More information on the capacity development initiatives and Tanrice 1 and Tanrice 2 projects can be found in the following reports: “Technical Cooperation in Supporting Service Delivery Systems of Irrigated Agriculture” (Tanrice 1) http://www.jica.go.jp/tanzania/english/activities/agriculture_04.html and “Project for Supporting Rice Industry Development in Tanzania” (Tanrice 2) http://www.jica.go.jp/tanzania/english/activities/agriculture_07.html.

• 8. Tanrice is implemented by specialized training institutes, such as KATC (Kilimanjaro Agricultural Training Centre), MATI (Ministry of Agriculture Training Institute)-Ilonga, MATI-Igurusi, MATI-Ukiriguru, KATI (Kizimbani Agricultural Training Institute), and the Rice Research Program in Tanzania and Zanzibar.

• 9. Participants in CARD include international organizations and donors such as the World Bank and International Fund for Agricultural Development (IFAD), and research institutes such as the International Rice Research Institute (IRRI), the Africa Rice Center (AfricaRice), the Japan International Research Center for Agricultural Science (JIRCAS). It also includes nongovernmental organizations, and South-South cooperation countries (such as Viet Nam).

• 10. The concept of NAIC was first used by H. Mint (JICA/JBIC 2008). In-depth theoretical and empirical analysis of Thailand was conducted by Suehiro and Yasuda (1987). Thailand’s agro-industrial development within the framework of the NAIC strategy and its results are discussed in JICA/JBIC (2008).

• 11. The survey covered a total of 2,177 individual small-scale farmers belonging to 114 of 122 model farmer groups from which data could be obtained in a manner similar to that used in the baseline survey.

• 12. For details of the case of agroforestry in semi-arid Kenya, see Chap. 7.

• 13. In Kenya, farm forestry is considered an essential way of increasing the forest cover and diversifying subsistence products and income while contributing to soil and water conservation (Forest Act of 2005). The Agriculture Act on Farm Forestry Rules of 2009 stipulates 10% forest cover on farms. See KEFRI’s web page on the Farm Forestry Research Program: http://www.kefri.org/farmf.aspx.

• 14. Clearly stipulated by the government’s policies, such as its Five-Year Plan for Socio-Economic Development 2001–05 (JICA/JBIC 2008, p. 59).

• 15. For example, in Bangladesh, the purchasing power of agricultural wages increased dramatically due to the increased productivity of rice, from the monetary equivalent of less than 2.5 kg of rice a day in 1983 to more than 6.0 kg today (World Bank 2012).