Agicultural development and trade liberalization

Abstract

Agriculture represents in Brazil roughly one third of GDP; a quarter of employment and 42% of exports. During the last 15 years, the cultivated area increased with 24%, but production more than doubled. Much attention is given to innovation in new technologies, fertilizers and agrochemicals for enhancing productivity. Supply in the agribusiness sector is continuously increasing, and Brazil has become a major exporter of coffee, sugar, soybeans and meat to the EU, US and Asian markets. Even while there is still some room for expansion, it is recognized that most of future agricultural growth must come from productivity improvement. Open markets are in the benefit of their consumers, but countries are entitled to maintain some subsidies for environmental and social purposes as long as these do not generate distortions in the market. This is the key question that has to be faced in the WTO negotiations. The core challenge for Brazil is to make agro-food chains a development instrument for the government. Cooperatives play a very important role in integrating chains and enhancing a participatory process of rural development. They bring small farmers together, adding value to their production and enabling them to access the market.