Vulnerable Places, Vulnerable People

Vulnerable Places, Vulnerable People

Trade Liberalization, Rural Poverty and the Environment

Edited by Jonathan A. Cook, Owen Cylke, Donald F. Larson, John D. Nash and Pamela Stedman-Edwards

While some argue that trade liberalization has raised incomes and led to environmental protection in developing countries, others claim that it generates neither poverty reduction nor sustainability. The detailed case studies in this book demonstrate that neither interpretation is universally correct, given how much depends on specific policies and institutions that determine ‘on-the-ground’ outcomes. Drawing on research from six countries around the developing world, the book also presents the unique perspectives of researchers at both the world’s largest development organization (The World Bank) and the world’s largest conservation organization (World Wildlife Fund) on the debate over trade liberalization and its effects on poverty and the environment.

Chapter 6: Trade Liberalization, Rural Poverty and the Environment: A Case Study of Sugarcane Production in the Incomati River Basin in Mpumalanga, South Africa

Jo Lorentzen, Anton Cartwright and Charles Meth

Subjects: development studies, development economics, economics and finance, development economics, environmental economics, environment, environmental economics, environmental geography


Jo Lorentzen, Anton Cartwright and Charles Meth The Incomati River Basin is a very poor and highly water-stressed area of South Africa. Sugarcane production, primarily for export, is the most important commercial activity, despite the heavy demand that cane production places on water. Liberalization of the South African economy, and particularly of the country’s sugar policies, has contributed to the expansion of the sugar industry. This expansion has provided development opportunities for some farmers in the region. However, the sugar industry’s demands on water and land have important impacts on the region’s environmental resources and on the large poor population that depends on those resources for their livelihood. Recent changes in the European Union (EU) sugar-subsidy regime are expected to affect world sugar production, including production in the Incomati Basin. This study examines the role that sugar is currently playing in the Incomati and how the changes in the EU sugar regime and the global sugar economy may affect the prospects of poor rural people and their environment. The conflicts and trade-offs examined in this chapter epitomize the conflicts that affect many other parts of southern Africa, and indeed the rest of the world. Global water usage has increased sixfold over the last 100 years and is forecast to double again by 2050 (FAO Aquastat; Falkenmark, 1997). Clearly, in South Africa there is excess demand for water. Resources in three of the country’s four catchments – Gariep, Limpopo and Incomati – have been over-allocated. When, in 2003–04, South Africa experienced a...

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