Immediate versus Sustainable Poverty Reduction

To help smallholders out of poverty, an integrated industry-wide approach is necessary. Focusing on smallholders alone will not do the job. However, the dominant poverty reduction approach of many official aid agencies focuses on livelihoods, marginal income increases and food security.

When operating in productive sectors, donors mainly want to support production by small-scale farmers or informal sector producers. But many of these initiatives are not sustainable, because they fail to see small-scale producers as embedded within an industry and forget to ask what economic transformation is necessary to make that industry grow as a whole and to integrate the small-scale farmers or informal sector producers.