Why Villages First?

© Dale Hampshire
Date Posted: June 7 2010.

In 1993, I set up Vanuatu Coconut Products Ltd in Vanuatu, an island nation in the southwestern corner of the Pacific. Within a few months we were producing 25 tonnes of coconut oil-based soap for the local market and took the market away from the imported Chinese soap. In 1995, I left Vanuatu and returned to Canada. The soap factory was a successful example of the gaining an economic advantage by adding value to a local resource to make a product that substituted an imported one. But as I reflected on what had been accomplished, I was bothered by the fact that very little benefit had gone to the smallholder farmers who actually produced the coconuts that the factory purchased as raw material.

Competing with mass produced imported soap required me to obtain the lowest price I could for the raw material, meaning that in the end, local processing did add value to the coconut but did not raise coconut farmer incomes. The factory had created about 20 jobs, but being in an urban area, this merely encouraged others to leave their villages and try their luck at getting one of the few wage jobs available in town. Steadily increasing urban drift has already created shanty towns around the two main urban centers in Vanuatu, bringing the social ills, crime, grief and violence that goes along with it.

Over the years some benefits have trickled out to rural villages from the center in the form of repatriated funds earned by those who have been lucky enough to gain work in town. But for the most part, these monies are quickly spent on consumer goods, and the village economy – its internal diversity, productivity and stability – is not improved. These gifts from town simply reinforce the attractiveness of urban life and increase migration. The strategy of developing the center and hoping that the benefits will trickle out to the periphery is not working. Rural villages are being left behind as the country develops.

Historically, rich countries developed through the industrialization of agriculture – large land holdings requiring increasingly complex and expensive technologies. Smallholder farmers in western Europe were forced off their land and into cities where many obtained jobs in the factories, while many others emigrated to North America, Australia, South Africa and other British colonies. In these new lands, they themselves could acquire large parcels of land and participate in the economic boom of the 19th and 20th centuries.

But for the 80% of Vanuatu’s people who live in rural communities - and I suspect many other smallholder farmers in poor countries around the world - there are not enough jobs in the cities and there is no ‘new land’ for them to flood into, to take and work as they desire. I am not saying we should not encourage urban economic development, but it seems to me that we are in a developmental bottleneck that is squeezing out rural development and unless we pay specific attention to developing the economies of rural communities, they will be left behind.

A more balanced approach to development and ultimately a more successful and sustainable way, I believe, is to find ways to improve the living conditions in rural communities so they can develop along with the urban centers. To do this, some of us need to put the development of villages first.