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Will Private Sector Investment In Food Aid Promote Dependency?

Olivier De Schutter, the U.N. special rapporteur on the right to food, writes in a Guardian opinion piece, “In order to support investment in agriculture, governments have … come to rely on private sector investment and development aid — and increasingly a partnership of the two,” and he notes “[t]he New Alliance for Food Security and Nutrition, proposed by [U.S. President] Barack Obama and the U.S. Agency for International Development and launched in May 2012, will draw more than $3 billion of private sector investment into food security plans in Africa.” He continues, “One potential danger of development aid, and particularly of private-led projects, is that the goals of poverty reduction and rural development can be relegated below the goal of raising food production.”

“Supporting smallholders makes this trade-off redundant — it channels investment to the productive capacity of those who are producing for local markets, and supports livelihoods in the most poverty-stricken rural areas,” De Schutter writes, adding, “This smallholder-led, country-led approach, is the type of aid that has the greatest multiplier effects for the poorest, and presents the lowest risks of dependency.” He concludes, “Ultimately, the objective of aid should be to make itself unnecessary. … It remains to be seen whether private firms, in partnership with public donors, will be willing to support approaches that look more like this, and less like the rest of their investment portfolios” (12/11).