ANDEAN AGRICULTURAL SITUATION

The agricultural sectors of the Andean countries have similar characteristics and some of them limit the sector’s development and justify taking joint action to overcome them.  These include the existence of productivity levels that are lower than in other parts of the world, above all of staple foods, and little technological development of tropical products; predominance of small farmers and problems of land distribution and tenure; failure to take advantage of potentials to ensure a better domestic supply of agricultural and food products; underdeveloped financial markets; weak presence of the State in the rural area; sizeable population sectors living in poverty; limited access to external markets; little private investment and insufficient services, among others.    

The heterogeneity of the production systems is another hallmark of the Andean agricultural sectors.  As a result, we find a modern, fruit and vegetable export- oriented sector side-by-side with a commercial sector properly inserted within the value-added chains that produces traditional products and a subsistence sector devoted to self-consumption or the sale of surplus products. 

The agricultural sector in the Andean Community countries today faces a new world situation created by the social, economic and political changes that accompany globalization and the consequent internationalization of economies.  Globalization, together with one of its main mechanisms for transmission, trade, represents an opportunity for the sector’s further development.  It also holds important risks at the same time, because of the inequity among countries, as well as within them --a factor that is particularly relevant in the Andean case.  It is also important to bear in mind that most of the rural population lives in poverty. 

More vigorous agricultural growth, involving heavier use of production resources, increased trade and more earnings, above all in sectors that are not well-integrated with the countries’ economies, would improve the standard of living of rural dwellers. 

Despite the efforts of recent years, the Andean Common Agricultural Policy (ACAP) has not been approved.  It was last proposed to the Commission at its meeting of December 2003, where it was agreed to put off addressing this issue to a future session.  At that same meeting, the Commission also decided not to take up issues connected with the Customs Union, thereby weakening the ACAP proposal as it is stands today.   

Although the adoption of a Common Agricultural Policy would involve establishing common rules and policies, in its present form, it is limited to citing a series of actions for identifying these common rules and policies, which would then have to be harmonized at the Community level.  

It is for these reasons that the development of an Andean Rural Development and Competitiveness Program is proposed, instead of insisting on the adoption of an ACAP.  This Program would involve a series of actions to identify the common rules and policies for subsequent harmonization at the Community level.  The set of harmonized rules and policies would then make it possible to progressively construct the ACAP.  The Program would also contribute heavily to the countries’ efforts to develop the sector.   

The Andean Rural Development and Agricultural Competitiveness Program will consist of the components that are included in the ACAP Action Plan approved by the Andean Agricultural Committee at its Eleventh Meeting (November 6, 2003), with the exception of the common market component.   

Furthermore, it is necessary to insist on the freeing of the resources deposited with the General Secretariat, in order to finance the actions proposed in the Program.   

Below are some of the considerations about the “value added” that is incorporated into the Program’s direction under a subregional body:

a) An overall vision of the sector’s development that would encourage the reduction of imbalances among the countries. 

b) Identification of public policies for harmonization among the Andean countries and compulsory fulfillment.

c) Establishment of joint positions in the various international forums on agricultural development.

d) Fostering of interaction among countries, coordinated efforts and the profitable use of national experiences. 

e) Creation, through joint actions, of economies of scale for the performance of activities. 

f) The Community’s store of knowledge about several subjects and experiences with programs of this kind. 

g) Assessments of product development or chains within the context of an enlarged market. 

The formulation of Community strategies and instruments for advancing rural development and improving agricultural competitiveness in the Andean Community countries is proposed, based on the above and in light of the mandates contained in the Cartagena Agreement.

* This text is part of the document Andean Rural Development and Agricultural Competitiveness Program approved by the Ministers of Agriculture at their meeting of July 10, 2004