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5. BACKGROUND PAPERS


5.1 Food and Agricultural Policies in the Near East Region: Situation, Issues and Prospects - by Abdou Dyaa[2]

1. Introduction

The countries of the Near East (NE) Region[3] have made significant progress in reforming their agricultural and trade policies. In addition, institutional reform and development to support agricultural and rural development is gaining importance in almost all countries of the Region. However, several challenges are yet to be met. The objective of this paper is two fold. It intends to highlight the role of the agriculture sector in economies of the Region, its main characteristics and the challenges to agricultural development in the Region. The second objective is to identify and discuss the main policy issues pertaining to agriculture and rural development in the Region and exploring the complexity of the system and the pressing needs for institutional reform and capacity building.

The paper includes six parts. Following this introduction, Part two highlights briefly the role of the agricultural sector in the regional and national economies in the Near East and describes the salient characteristics of agriculture in the Region. The major constraints and challenges to agricultural development in the Region are discussed in Part three. In Part four, the paper discusses the major agricultural policy issues in the Region including: natural resource management, rural poverty and food security issues, market liberalization and trade policies and institutional reforms. Finally, the prospects and emerging issues for future agricultural development in the Region are outlined in Part five, while part six is devoted to the concluding remarks.

2. Agriculture in the Near East Region

2.1 Relevance and Importance

Agriculture plays an important role in the economies of most NE countries. In 2001, agriculture represented more than 13% of the total GDP for the Near East in comparison to less than 5% of the World average and less than 2% in USA. However, this importance varies considerably among different countries. In 2001, the percentage contribution varies between less than 1 percent in Bahrain, Kuwait, and Qatar to more than 30% in Uzbekistan, Kyrgyzstan, Sudan, Djibouti and Somalia (Appendix 1).

Agriculture is also an important generator of employment in several countries of the Region. In 2001, the percentage of agricultural labour to total labour force ranged from 1% to 10% in the Gulf States, Lebanon, Malta, Libya, Iraq and Cyprus, compared to 30-40% in Egypt, Morocco, Tajikistan, Turkmenistan, Mauritania, Somali and the Sudan. The average for the Region was 37% in 2001, though this average showed a continuous decline from 64% in the 1970s, to 56% in the 1980s and 45% in the 1990s (Appendix 2).

Agricultural exports contribute significantly to total merchandise exports in some countries of the Region, such as Cyprus (41% of total exports in 2001), Somalia (47%), Syria (29%) and Uzbekistan (29. However, the opposite is true for some other countries such as Bahrain, Iraq, Kuwait, Libya, and Saudi Arabia, where agricultural exports accounted for less than 1% of total merchandise exports in 2001. Over the last four decades the contribution of agricultural exports to total exports for the whole Region has been eroded from 16% in 1970 to only 4% in 2001. In absolute term, the value of total agricultural exports of the NE, which amounted to US$ 14.4 billion in 2001, is growing extremely slowly, having been US$12 billion in 1990. The relative share of the NE in world agricultural exports has dropped steadily, from 7 percent in 1971-80 to 3 percent in 1991-2000 (Appendix 3).

2.2 Salient Characteristics

The Near East Region is a vast zone of generally diverse climatic conditions, characterized by very low and highly variable annual rainfall and a high degree of aridity. In the past, the rivers have laid down deep, alluvial fertile soils and have supported several of the earliest irrigation societies and civilizations. However, very productive land is also extremely vulnerable to drought if mismanaged, leading to irreversible damage, such as desertification. Agro climatic areas are: Sub Humid 4.4%; Semi Arid 11%; (dry land farming) Arid 17%; and Hyper Arid 62% (less than 240 mm annual precipitation).

Total land area for the Near East Region represents over 15% of world's total area. Agricultural land represents only 8-10% of the total area and its production remains tributary of irrigation for the most part. However, only 32% of the agricultural land is irrigated and contribute more than 50% of the total agricultural production. Growing population, fragmented parcels and traditional/religious inheritance rights have led to small landholding sizes. In 2000, the total arable land amounted to 155 million hectares, approximately 37 percent of which was irrigated (Appendix 4)

Agriculture accounts for 90% of the mobilized water resources with the latter representing over 60% of the total potential water resources of the Region. The Region's irrigation systems are under considerable environmental strain, with almost all countries experiencing problems with salinity and water logging. A further cause for concern is the overexploitation of groundwater in many countries of the Region. Given that water is practically cost-free in most countries, the sustainability of irrigation systems is a major concern. Surface water used for irrigation accounts for 90 percent of irrigation while 10 percent comes from ground water sources. Ground water is of primary importance in most countries, including fossil non-renewable water in many countries.

While further growth in agricultural production from the irrigated areas may not be as high as in the past, these areas would require resources to maintain the current level of productivity. Also, further development of irrigation must rely as much as possible on low-cost methods and technologies adapted to local conditions. Examples include water harvesting, use of cheap low-lift pumps and exploitation of shallow aquifers requiring simple methods of water extraction. Also, new approaches to irrigation must emphasize the development of skills and of incentives to the adoption of water-saving irrigation equipment and practices, and encouragement to participatory management of water resources.

The farming systems prevailing in the Region include: irrigated; highland mixed, rainfed mixed, dry, pastoral, sparse coastal artisanal and urban based agriculture. In several countries of the Region, the traditional nomadic pastoralism has been replaced by modern mechanized farming. The traditional livestock sector, however, remains important in some countries (e.g. Sudan, Somalia, and Mauritania), while others, such as the Gulf States, are supporting nomadic and sedentary small-scale producers through subsidies. Some countries have embarked on rangeland improvement programmes through range cooperatives and rangelands use regulations. On-farm food production is becoming steadily less important for poor rural households throughout the Region. Small farmers depend heavily on sales of their labour as a major source of family income: even families holding between 1 and 2 hectares get nearly one-third of their income from selling their services as hired labour. Enhancing opportunities for off-farm employment and income is becoming increasingly important for rural development and welfare.

Degradation of natural resources is especially serious in the low rainfall areas that represent over 70 percent of the total rangelands in the Region. For the nomadic population, their incomes depend directly on the rangelands' quality and quantity. In normal years, animals are kept on the rangeland for eight months and then fed for the remaining four. With prevailing drought conditions, involving shortage of forage and drinking water in large parts of the rangelands, livestock are fed for most of the year. Large numbers of farmers and herders have migrated from their villages to search for water and livestock feed. The system is based on the traditional opportunistic mobility, which balances availability of feed and water with aversion of wet-disease infected areas This phenomenon requires immediate attention to prevent major population displacements and further environmental degradation.

The livestock nomadic system spread over a wide area, extending from the dry and low rainfall rangelands in the Middle East and the Arabian Peninsula to the high rainfall areas (above 1200 mm) of the southwest and southern Sudan. The dry ecological zone in which this animal production system is practiced is characterized by too low or erratic rainfall to support crop production, as average rainfall is usually less than 300 mm. Cropping and livestock production activities may be practiced concurrently by pastoralists who are more or less nomadic and have well established patterns of grazing migrations over a wide area.

Nomadic pastoralism is a strategic response to the seasonal fluctuations of the scarce resources. Nomadisms in the Region have been traditionally dominated by camel and sheep raising, with sheep becoming predominant in recent times due to their greater marketability. In some countries (Saudi Arabia) trucking of water, allowed them to exploit areas that would have otherwise been unavailable for livestock raising. However, continued pressure or concentration of livestock in overgrazed areas has led to irreversible degradation and desertification. This highly fragile ecosystem should, therefore, be protected as an adapted eco-social system for the livelihood and husbanding of natural resources.

The Near East Region has a vast coastal area and several rivers of good potential for fishing. In the fisheries sector, the Near East Region has become a net exporter, but its global share of trade is marginal, accounting for only about US$ 135 million in 1999 (NERC 26).

The total forest area of Near East countries accounts for 5.8 percent of the total land area (NERC 26). In addition to forests, some countries in the Region (notably Algeria, Morocco, Somalia, the Sudan and Yemen) have significant areas of "other wooded lands". The latter are important sources of wood and non-wood forest products, and play an important role in land stabilization, watershed management and desertification control. Fuel wood and charcoal are the major forest products together with browse for domestic animals. Production of industrial wood is very limited: about two-thirds of the demand is met by imports (ibid).

In dry lands and other areas of the Near East, non-wood forest supports the livelihoods of millions of people. Traditionally, forest fruits, leaves, seeds and nuts, mushrooms, honey and animals are all important sources of food and food additives in the Near East. However, forest products vary greatly with local availability and preferences. They range from products used for local consumption to products which are traded in the international markets and which have represented major commodities for a long time. However, in the Near East, the majority of forest products are used for subsistence and in support of small-scale, household-based enterprises, which provide income and employment for rural people, especially women. Despite their importance for local economies and for the people, forest products in Near East are still largely neglected in the policy and decision-making processes of natural resource management.

The review of the characteristics, trends and potentials of the main farming systems in the Near East clearly indicates the close interdependence of people, water and land-based resources. There are also important linkages between different farming systems, particularly between livestock and cropping systems. Investment in the agricultural and rural development sectors, apart from irrigation, has been relatively modest. Two groups that have been excluded from most development initiatives have been; (i) poorer farmers living in dryland areas; and (ii) the pastoralists who occupy a unique role in the rural economy and in the long-term maintenance of a stable environment in dry areas. In view of the interdependency of resource management systems, the neglect of one farming system could have a major impact on people dependent on other systems.

3. Challenges for Agricultural Development in the Region

The Near East Region faces several challenges and constraints to sustainable agricultural development. These include natural resource, policy and institutional constraints. This section briefly discusses these constraints.

3.1 Natural Resource Constraints

3.1.1 Land Resources: Size and Quality

A major issue constraining sustainable agricultural production in several countries of the Region is agricultural land and water scarcity. In addition, the Region faces a serious problem of degradation of the natural resources due to soil erosion, desertification, water logging and salinity. In fact, managing natural resources in an efficient and sustainable manner is now one of the most critical issues for food production in the Region. Land has been subject to varying degrees of degradation.

Wind erosion is believed to affect 35 percent of the total area, while water erosion affects 17 percent. Many of the slopes are stony and denuded by water and wind erosion. This process has led to desertification, which is irreversible in many areas. Where irrigation is intensive, as in Egypt or Iraq, salinization has emerged as a major problem. In those cases where the major source of land degradation is excessive irrigation, policies that correct for the price distortion of the past, notably free or subsidized irrigation, will help reduce both the problems of excessive water use and its negative effect on soil degradation. It is also important that the agricultural production effort focuses primarily on those areas that offer the greatest potential for cost-effective and ecologically sustainable increases in land productivity. The quality of land is poor as a result of soil degradation, diminishing fertility, over-use, and wind and water erosion.

Poor pastoralists, whose livelihood depends on rangeland and common property water resources, have been adversely affected by encroaching urban and rural communities, and by previous government policies that encouraged feed grain production, over-grazing and mechanization with unsuitable land preparation implements. Furthermore, rigid rangeland tenure policies and poor social organizations have made it impossible to develop effective common-property management programmes that encourage beneficiaries to use and maintain the rangelands in a more sustainable manner.

3.1.2 Water Resources - Scarcity, Quality and Management

Water resources in the Region are limited and vary from year to year, with an average representing less than 2.2% of the total water resources of the world. This share becomes only around 1.2% when considering internal renewable water resources, as the rest flows from outside the Region. The average annual precipitation is only 3.5% of the world total freshwater (110000 km³) which falls through the hydrologic cycle every year. Water resources are available for about 9.8% of the world population living on 13.8% of the total area of the world. Appendix 4 shows the available water resources and their use in the countries of the Region.

Scarcity of water constitutes the most formidable challenge to agriculture in almost all countries of the Region. Ten countries withdraw more than internal availability. There are problems of over exploitation: countries with stress or chronic water scarcity - Egypt, Iran, Oman, Lebanon, Somalia; countries beyond water barrier - Libya, Yemen, UAE, Saudi Arabia, Qatar, Jordan, Bahrain, Kuwait, Algeria, Mauritania, Morocco. The issues involved include scarcity of water or over irrigation due to pricing and policy problems, salinization, and unclear property rights. Out of thirty countries, ten have annual per capita availability of renewable water supplies below the world average of around 5,000 m3, and less than 1,500 m3 in other ten countries.

The present over use and degradation of water resources and growing competition from non-agriculture water users are expected to influence the cost and availability of water for food production. The World Bank reports that, by year 2025, annual renewable water supplies in almost all countries of the Region will fall below 700 m3 per capita. Despite substantial scope for greater efficiency in water use in the Region, limited water availability will be increasingly inadequate for the needs of a growing population.

3.1.3 Population - Employment in Agriculture

Total Population in the Region is estimated to be about 652 million (about 9% of world population). The Region has always been characterized by persistently high population growth rates, which in the 1980s averaged 3.1%. Although this rate fell to 2.3% in the 1990s, the labour force is still growing at more than 3% per annum as a result of previous population growth. The fertility rate in the Region has declined to 4.9 from a high of 6.6 in the 1970s, but remains at around 7.0 for countries like Somalia and Yemen.

The estimated rural population of 328 million represents about 50% of the Region's entire population. There are considerable country-to-country variations in the share of rural people. For example, while it represents less than one fifth in Djibouti and Lebanon, the share exceeds two thirds of total population in Somalia and Sudan. (Appendix 2)

During the period 2000-2030, the projected population of the Region is expected to almost double from its present 652 million. This constitutes a serious pressure and considerable negative impact in areas with fragile or vulnerable soils and sloping land, and will certainly be of importance for water resources everywhere. The areas around major centers of population are particularly likely to suffer from various forms of environmental degradation and water shortage.

The most significant trend over the past 30 years has been accelerating urbanization. This trend is likely to continue, resulting in rapidly rising demands for water and food - particularly cereals and livestock products. In the rural areas, the growth in the proportion of income earned from non-agricultural activities is likely to continue and this has to be considered when strategic options for potential investment are being reviewed.

3.2 Policy Challenges

3.2.1 Urban/Industrial Bias

In the Near East Region, both development policies and investments in public goods have had a strong bias for many decades in favour of urban development as well as industrial development. Many public institutions in the recent past have been extremely centralized and development policies have tended to favour cheap food for urban populations and cheap agricultural raw materials for manufacturing. Infrastructural investments have also favoured major centers of population; primarily in the provision of water, basic services and communications links. The development of road systems has generally served national security or urban objectives, rather than rural development; indeed, their construction has sometimes been in conflict with agricultural needs. Similarly, a great deal of high quality land has been lost close to cities, as a result of weak planning regulations and lack of forward thinking. Conflicts over rates of water extraction are already becoming a major issue in and around centers of population, and these conflicts are expected to intensify in the future.

3.2.2 Inward Centralized Planning Systems

The high degree of centralization of planning systems, and the rigid imposition of a target approach to production, has stifled innovation and diversification in many areas - particularly in the major irrigation schemes. Research has rarely been focused on applied problems of producers in risk-prone areas, or on the more efficient use of water. Market research for small producers has been minimal. Extension systems have often been very top down in design and delivery, leaving little scope for farmer-driven initiatives and partnerships.

The central-planning model adopted by many countries in the post-independence period has left a legacy of misallocated resources, inefficient use of existing factors of production and disincentives to invest in the agricultural sector, all of which have contributed to the poor productivity and performance of the rural economy.

Now, there is growing recognition that agricultural development and food scarcity problems confronting many countries in the Near East Region is not so much due to technological factors (the technology is already there "on-the-shelf"), as it is to policy factors including low levels of rural people's participation in the agricultural policy-making process. The existing situation in many low-income food deficit countries (LIFDCs) reveals the existence of a fundamental imbalance in their agricultural policy-making processes that frequently gives excessive weight to the priorities and needs set by more organized and vocal urban consumer interest groups, like government salaried workers and organized labour, and not enough to the priorities and needs set by rural food producers, particularly small-scale farmers who produce the bulk of domestically-consumed food. As it is now becoming abundantly clear, if the latter are given the right policy and price incentives, adequate food can be produced and the crisis easily overcome.

The cause of and cure for this imbalance is largely organizational. One of the main reasons why the concerns of rural food producers in many LIFDCs are not heard in policy making arenas is because they are poorly organized and consequently have little voice in shaping government agricultural and rural development policies.

3.2.3 Policy Reform and Liberalization

Until the early 1990s, in many countries of the Region, the involvement of the state in the agricultural sector was considerable and included price support measures, consumer food subsidies, production and area quotas, and trade barriers to support food self-sufficiency. While farmers often received input subsidies (for credit, seed, fertilizer and fuel), they were also obliged to sell their output to state monopolies at fixed prices which - depending on the country - were either below or above market prices.

Like everywhere else in the world, the system of subsidies and market controls distorted the allocation of resources and led to inefficiencies and stagnation of the agricultural economy. In the wake of liberalization programmes, subsidies have been abolished or rationalized in many countries of the Region. As a result, the agriculture sector is slowly adjusting to a new market-oriented environment and to globalization. This calls for a new focus on agricultural support services provided mainly by the private sector, with an important role for the government as a facilitator and provider of an enabling environment. The role of government, civil society (including Non Governmental Organizations), and donor agencies will be crucial in helping the rural poor benefit from this transformation. Also, in-spite of the recognition of the need to reform, there are many challenges yet to be met in many countries in the Region concerning the sequencing and speed of reform as well as completing the reform for services, fiscal policy instruments, and the creation of the enabling environment for the private sector to contribute and prosper.

Recently, trade liberalization has favored the larger producers in the Region, as many smaller operators have moved out of farming and trading altogether. Smaller businesses dealing with agricultural products have also found it increasingly difficult to compete because there are only few areas in which they have any comparative advantage. There is minimal development of small-scale agro-processing industries in all but a few countries. Any growth of small-scale enterprises has usually been through individual or close family efforts and not through co-operative movements or producers' organizations. The absence of credit for small producers and lack of market intelligence concerning overseas markets has also acted as a constraint to any significant development at this level.

However, many small farm households have diversified their livelihoods by developing off-farm activities such as tourism, catering and other services - often through family linkages. This trend is expected to continue in the coming 30 years and off-farm income will progressively grow in importance, especially for poor households.

3.2.4 Investment in Agriculture

In response to the applied structural programmes and austerities of the fiscal policies, Governments of the Region have been adopting measures to balance Government budgets and reduce public expenditure. In many countries, this has lead to reducing investment in agriculture and rural areas. Also, notwithstanding the progress in raising food consumption per person in the Near East Region, the food gap continued to widen over the last three decades, due to failure of the expanding agricultural production to keep pace with the rapid growth in food demand. This mainly attributed to the decline in net private capital flows and Foreign Direct Investment (FDI). Between the late 1950s and up to the 1980s, most countries invested heavily in irrigation development, especially large-scale infrastructure such as dams, water conveyance and distribution schemes and irrigation networks. The irrigated area expanded by an average of 1 percent per year during the early 1960s, reaching a maximum annual rate of 2.3 percent per year from 1972 to 1975 and slowing down during the following decades. The financial crises in the second half of the 1990s adversely affected private financial flows and their recovery has continued to lag output and trade growth.

Worldwide, FDI flows have not been sufficiently responsive to the increasing food demand because the perceived risk related to the legal and regulatory frameworks as well as to contract enforcement and dispute settlement mechanisms. The share of FDI in net private flows increased from 58 percent in 1997 to 69 percent in 2000, about US$5 000 million more than in 1997. FDI flows to low-income countries quadrupled between 1991 and 2000, but remained less than 2 percent of their GDP. The share of the low-income countries in all FDI flows to developing countries fell to 7 percent (13 percent in 1991). Poor countries have had particular difficulty in attracting FDI, due to insufficient market size, poor infrastructure, political uncertainty, corruption and restrictive policy regimes. The top ten developing country recipients of FDI (none in the Near East Region) accounted for 74 percent of total FDI flows to developing countries in 2000, amounting to 3.8 percent of their GDP.

Recent evidences revealed that agricultural growth have a major effect on poverty reduction than do the industrial sector growth. Results in Africa and Latin showed that public sector investment in agriculture has a far greater multiplier effect than that for non-agriculture (Mellor, 2000). It was found that the elasticity of yield with respect to public expenditure was 0.29 a high figure given the large size of agricultural relative to state spending (Datt and Ravallion (1998). Thus state spending reduces poverty through its effect on farm yields. These data show that recent pressures to reduce public sector deficits when applied across the board have a disproportionate effect on agricultural growth. It should be noted that the concept of investment to augment the productive capacity of agriculture entails not only physical assets, but science and technology dissemination, human capital enhancement and social capital build-up. Creating a pro-investment climate to raise productivity levels and realize the necessary structural changes becomes a principal policy challenge. The whole policy and institutional environment needs to be conducive to investment by the private agents, in particular the farmers.

3.2.5 Political/Social Stability and Emergency

Many countries in the Region are currently (or have been recently) under severe political instability including Afghanistan, Algeria, Iraq, Palestine, Somalia, Tajikistan and Sudan. This represents a serious threat to developmental efforts exerted by the Governments of the Region as well as to the support provided by development partners. It also creates a climate of instability in the entire Region which deters foreign investment.

This situation could have far-reaching ramifications on economic development and food security in the Region especially for the LIFDCs and vulnerable groups. These developments may warrant more technical assistance in the design of appropriate policies and supportive enabling environment to facilitate implementation and monitoring of national poverty reduction and household food security programmes. The move from emergency to rehabilitation and to development needs special attention in the NE Region. The issue of food aid and its implication within WTO and impact on food security in the Region is gaining importance. More than 80% of the food aid to the Region is received by LIFDCs but its volume has declined in recent years.

3.3 Institutional Challenges

In addition to the resource and policy constraints mentioned above, agriculture in the Near East Region operates under numerous institutional constraints. In the NE Region most institutions have been developed as part of the centrally-planned structure to serve as a system for providing basic goods and services needed under the socio-economic and physical set-up of the Region. For most countries in the Region traditional institutions emphasized the need to safeguard the livelihood and prosperity of small widespread communities living on marginal land and practicing farming under extremely harsh climatic conditions. As a result of these conditions escalating food deficiency is widespread across the Region. Therefore, increasing and stabilizing food production and income, safeguarding food security and alleviating rural poverty have been at the core of traditional agricultural and rural institutions in the NE.

The traditional institutions have enhanced the role of the state as a producer of raw and processed agricultural products and provider of inputs and services mainly through extensive operations and interventions carried out by numerous parastatal agencies. In all countries of the Region, traditional institutions have over-emphasized food self-sufficiency and import substitution with almost complete disregard to efficiency considerations, targeting at short-term objectives focusing on accessible food prices, employment and foreign exchange generation and savings needed for financing consumption of imported commodities and fuelling investments in other sectors of the economy.

In the Near East, while there is a wealth of religious and local cultural traditions and institutions among the tribes, clans and kinship groups of the Region, new forms of association among rural people, that would help them interact with political, administrative and economic institutions, are relatively undeveloped. The range and number of citizens groups and informal institutions in the countries of the Region are either very limited or have limited powers. As a result, poor rural people are unable to claim their rights and entitlements; they have little leverage in negotiating with more powerful elite groups; they are ill at ease when dealing with formal government institutions; and they have a weak voice in local politics.

The rural poor are constrained by disproportionately low investments in rainfed agricultural production technologies in relation to the number of households that depend on it. These constraints are reflected in the poor spread of improved, drought- or salt-tolerant, crop varieties, limited application of water-saving technologies, few investments in research and scarce attention to improved rangeland management techniques. Similarly, improved animal breeds, or the technology to produce them, are either not available in the poor areas or, due to the high costs involved, they are beyond the reach of the poor.

Poor rural people in the NE Region have very little access to physical infrastructure such as roads, safe water, sanitation, and communication and information networks, and there is a shortage of social infrastructure, such as schools, clinics, and training centers. Cuts in public expenditure following structural adjustment programmes have further reduced state investments in the rural areas. With little access to services to improve their human capital, the rural poor are unable to engage in rewarding economic activities. As a result, and especially in remote areas such as the mountainous Regions of Morocco, Turkey and Yemen, the rural poor are often economically, physically, intellectually and socially isolated from the rest of the nation.

Financial services continue to be heavily dominated by public-sector institutions, especially with respect to finance for agriculture and other rural-based economic activities. In the past, governments have used state financial institutions in the rural areas to implement national development and planning programmes, allocate subsidies and provide inputs on credit. These lending policies tended to favour larger farmers and entrepreneurs with physical or financial collateral, thus excluding the rural poor. Low-income rural households have few alternative sources of finance, and informal financial institutions or community-level savings and credit groups are very rare in the Region.

Lack or sufficient rural finance, especially for agriculture and, more particularly, for small farmers is shared in all member countries, though not equally. The market for rural finance needs to be organized and enlarged through encouraging the establishment of new financial institutions, and new instruments need to be utilized. Moreover, special programmes for financing rural businesses and small farmers need to be designed and implemented. The need is also there for enhancing the capacity of professionals in the financing institutions in general and those working in rural areas in particular. Some countries, such as most of the CIS countries, need to establish appropriate land ownership to enable farmers benefit from regular bank lending.


[2] Chief, Policy Assistance Branch, FAO Regional Office, Cairo, Egypt.
[3] The Near East Region as defined in this paper includes 30 countries namely: Afghanistan, Algeria, Bahrain, Cyprus, Djibouti, Egypt, Islamic Republic of Iran, Iraq, Jordan, Kazakhstan, Krygz Republic, Kuwait, Lebanon, Libya, Malta, Mauritania, Morocco, Oman, Pakistan, Qatar, Saudi Arabia, Somalia, Sudan, Syria, Tajikistan, Tunisia, Turkey, Turkmenistan, United Arab Emirates (UAE) and Yemen.

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