Their Implications for Competition Law
Edited by Michal S. Gal, Mor Bakhoum, Josef Drexl, Eleanor M. Fox and David J. Gerber
Chapter 6: Competition issues affecting the agricultural sector in selected developing countries: key findings from selected UNCTAD market studies
In the economies of most developing countries, the agricultural sector plays a crucial role in terms of contribution to the Gross Domestic Product (GDP), employment and potential poverty reduction. This importance of the agricultural sector has recently been summarised by the Food and Agriculture Organization (FAO): Well over half of the developing world’s population – 3.1 billion people, or 45 per cent of all humanity – live in rural areas. Of them roughly 2.5 billion derive their livelihoods from agriculture. For many economies, especially those of developing countries, agriculture can be an engine of economic growth. Approximately two-thirds of the world’s agricultural value added is generated in developing countries, and in many of them the agricultural sector contributes as much as 30% to the Gross Domestic Product (GDP) and is a source of employment for two-thirds of the labour force. According to the World Bank, growth in the agricultural sector can be up to 3.2 times more effective at reducing USD$1/day poverty than growth in other sectors. Importantly, agriculture can provide a haven of resilience against global economic and financial turmoil, often more effectively than other sectors. However, economic growth in the agricultural sector in developing countries is hindered by a multitude of factors, including a lack of investment, missing or weak infrastructure, stagnant agricultural productivity, a lack of opportunities for income diversification and poorly functioning agricultural markets.
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