Seeds of Hope: Agricultural Technologies and Poverty Alleviation in Rural South Africa
Mercatus Policy Series, Policy Comment No. 6, 2006
52 Pages Posted: 13 Nov 2007
Date Written: August 1, 2006
Despite having the largest economy in Africa, many of South Africa's citizens grapple with poverty. For rural residents especially, poverty is pervasive, and hunger a very real threat. Government efforts to improve the lives of smallholder farmers and other rural residents are slow to bear fruit.
Enter the private sector, specifically Monsanto South Africa, with the Combi-Pack, a box containing enough maize seed, herbicide, and fertilizer to plant 1/4 hectare of maize. Combi-Packs are part of the phenomenon known as marketing to the bottom of the pyramid. Large corporations design and sell products and services to very low-income consumers, billions of individuals who as a group have substantial purchasing power.
Farmers in KwaZulu-Natal and Mpumalanga provinces who use Combi-Packs along with no-till, or minimum-till, agriculture have increased maize yields. Now, the farmers raise enough maize that they can feed their families and then sell the excess, earning money to fix homes, buy clothes, and pay school fees.
Furthermore, Combi-Packs combined with no and minimum till agriculture have had beneficial effects for the environment, reducing erosion, and conserving water. Swelekile Alina Nkosi, a farmer in Mlondozi in rural Mpumalanga, enjoys these benefits. I'm so happy with this way of farming. What will happen when I'm old I don't know, but one thing is good, and that is now there's no water cutting through, so my soil is conserved.
Combi-Packs will not solve all the problems of rural poverty. Land tenure insecurity, high banking costs, and rigid labor laws continue to plague the farmers. However by creating and selling the Combi-Pack, Monsanto is doing something that critics of globalization might find surprising: a multinational company is helping to drive away hunger and better the lives of the rural poor.
Keywords: Africa, South Africa, Monsanto, Bottom of the Pyramid, Entrepreneurship, Agriculture
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