Using Agriculture to Aid Developing Countries

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  • 0:02 Agriculture and Free Trade
  • 0:44 History
  • 1:35 1990s and 21st Century
  • 2:27 Migrant Workers
  • 4:10 Lesson Summary
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Lesson Transcript
Instructor: Christopher Sailus

Chris has an M.A. in history and taught university and high school history.

In this lesson, we explore the recent push by international organizations for developing countries to open up their agricultural sectors to global markets. Proponents and critics of the program abound.

Agriculture and Free Trade

When you were a kid, did you ever set up a lemonade stand? Likely, it was a crash course in rudimentary economics because you had to decide what to sell your lemonade for, given the cost of lemons, sugar, and your time. Or - let's be honest - maybe your parents just gave you the materials.

Well, for farmers of the third world who have to deal with fluctuating global prices and demand, what price to sell their crops at is a daily issue that can make or break their farm and family. Since the 1990s, strategies spurred by increased globalization have tried to stabilize and improve the lives of these farmers in impoverished nations. Though, as this lesson will show, the strategies' results and ethics are still a matter of hotly contested debate.

History

For centuries, agriculture was a relatively local business. Farmers grew as much as they possibly could, given their land and resources. After feeding their families, whatever was left over was sold at markets or to distributors in growing cities. That profit was then put into buying more supplies, tools, or seed for the following season.

Moreover, most countries, even as global trade became more and more prominent in the 19th and 20th centuries, often put in economic measures to protect domestic markets and domestic agriculture from cheaper foreign imports. These measures often kept prices artificially high on certain goods. This achieved two-fold: while it guaranteed a certain standard of living and higher prices for farmers' crops, it also kept food prices high at marketplaces and adversely affected the standard of living and purchasing power of the rest of the country.

1990s and 21st Century

In the past two decades, parties in both developing countries and in the developed world have instigated changes in this system. Several organizations, including the World Trade Organization (WTO), set out in the late 1980s and early 1990s to create a more globalized era of food production. For example, during the Uruguay Round of the discussions on the General Agreements on Tariffs and Trade (GATT), the WTO pushed to end the usage of tariffs, quotas, subsidies, and other forms of government assistance to protect farmers and agricultural markets in developing countries.

The idea is that by integrating the markets of developing countries into the global food market, these developing countries can gain wider access to more markets for their goods, expanding demand for their crops and, at the same time, meeting the demand for increased food production in developed countries with poorer supplies. Consequently, the populace of these countries will also gain access to the global economic food market and hopefully pay cheaper prices for food, thus raising everyone's standard of living. For example, instead of buying a bag of rice produced by farmers a few towns over for $10, people in developing countries could now buy a bag of rice produced in India or China for $3. Those $7 savings could then be saved or spent on something else entirely.

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