The Role of Market-Driven Initiatives and Support for Rural Poverty Alleviation - a Case Study of AgResults Program in Nigeria

Abstract

The connection between persistence rural poverty in the developing nations, agricultural-related structural problems have been debated extensively in the literature. Surmounting both challenges of the extensive rural poverty in the developing countries and particularly in sub-Sahara Africa (SSA) and how agriculture system can be supported to the reduce rural poverty has been a daunting task for governments (Ajulor, 2013; Tersoo, 2013). Discourse on the role of market-driven agricultural approach through Agribusiness enterprises as a means to reduce the structural problems in agricultural that are linked to rural poverty alleviation is also emerging (Dorward et al. 2009; Suttie 2019). Recently, several Agri-business models have sought to fill the structural agricultural vacuum by developing new systems of support through private enterprises for the smallholder rural poor. One of this new initiative is the AgResults Global initiative aimed at attracting involvement of the agribusiness private enterprises to address key structural agricultural problems, aimed at increasing smallholder farmers income (AgResults Initiative 2018). This research is based on the case study of the AgResults Global initiative in developing agribusiness in Nigeria; a country with high indicators of high rural poverty and major structural agricultural problems. The objective of the research is to understand the theoretical and empirical effectiveness of the AgResults model in enhancing structural support for rural development and poverty alleviation. It aims to examine the effectiveness of an AgResults market-based development program of agribusiness and to understand the extent to which private sector-managed initiatives in market-driven agriculture alleviate the structural agriculture problems and rural poverty. It assesses the extent to which the new, private-sector mechanism of support for rural poor farmers could support an increase in agricultural productivity, income, and diversification in food consumption in Nigeria as part of the rural poverty alleviation. The study uses a combination of survey and semi-structured interviews to generate primary data. The research sample consisted of 170 smallholder farmers, one hundred and four smallholder farmers for the treated group who were supported by the implementers of the AgResults project and 66 smallholder farmers as control groups who were not supported on the project but had similar characteristics to the treated groups that were working on the project. The research shows that smallholder farmers can increase their output and income where timely and consistent support for the crucial structural problems of agriculture is available. The research further showed that smallholding farming in a business managed environment contrast to the fragmented smallholder farmers system that are not operating under such condition could experience an increase in their output and substantial profitability in their agribusiness. Overall the results showed that Agresults Agribusiness model created an ecosystem that brings together most of the critical structural solution to strengthen the smallholder farmers participation in a market-oriented agricultural system. Through the fundamental agribusiness skills support gained by the smallholder farmers they were able to access quality-sensitive premium markets, increased their revenue and grow their businesses from subsistence to one with a market-driven objective. The smallholder farmers have further attributed the increase in the income to the diversification in their consumption pattern towards a healthier diet.