Promoting Investment in Agricultural Production: Increasing Legal Tools for Small to Medium Farmers
8 Ohio St. Entrepren. Bus. L.J. 28, 2013
Posted: 22 Aug 2013 Last revised: 9 Jan 2016
Date Written: August 22, 2013
Since 2000, the demand for agricultural commodities has increasingly outstripped supply, leading to high food prices and chronic hunger in low-income countries. The number of undernourished people in the world is currently estimated at 925 million, and the future does not look any brighter. Projections show that the world’s population will be approximately 9.1 billion in 2050. In order to feed that many people, the world’s food production must increase by some seventy percent and production in low-income countries must nearly double. Many believe improving the productivity of smallholder farmers will ensure food security in low-income countries. Suggestions for improving productivity include the obvious: better fertilizer, improved seed, and supplemental irrigation and water harvesting to offset dry spells and extend growing seasons. Suggestions also include the less obvious: changing and developing legal frameworks to promote agricultural financing.
There is a dearth of financing and government support available to smallholder farmers in low-income countries, and as a result most are caught in a cycle of subsistence farming, constrained by their inability to leverage the assets they have to purchase necessary supplies and equipment. However, there is hope as several international organizations have participated in a vast amount of research, legal text creation, and harmonizing law. These projects, when viewed in conjunction with one another, could potentially present a full package of transnational commercial law texts that can promote investment in agricultural production.
This paper surveys the various legal texts promulgated by various international organizations. In doing so, the paper identifies various gaps in coverage and areas in need of reform to assist agricultural financing. It concludes by calling for international organizations to: (1) coordinate amongst institutions and activities to improve agricultural finance policy; (2) develop soft law instruments that focus on agricultural finance; and (3) work with local and regional entities to improve judicial enforcement of legal rights.
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