IN

X. A MARKET ECONOMY-THE BASIC NEED

X.1. CURRENT SITUATION

Afghanistan has a population variously reported at 24 to 26 million. Poverty and poor nutrition, even to malnutrition, are reported by WFP and other agencies as common in rural areas. Many farm families are unable to purchase seed and fertilizers to improve their production. The majority of the rural population is, relatively speaking, low-income and at poverty levels.

Land holdings are small, with little chance of increasing the cultivable area operated by the average family. Many are unable to produce their basic food needs, and depend on outside, often seasonal, employment or other sources of income to sustain themselves. With the current economic situation, adequate employment within the country does not exist.

In the last reported/estimated year, GDP was estimated at $300 per capita. No figures on personal or family income were available, but the average rural income (and some 80% of the population is rural) is clearly below the level considered necessary to maintain a healthy life.

X.2. FAMILY FOOD AND LAND REQUIREMENTS

Bread is the basic foodstuff of Afghanistan. Reportedly, per capita consumption of wheat is 180 kg per year. Thus, one ton of wheat would feed 5.6 persons per year. For a population of 25 million (a median figure of the population estimates), total national wheat requirement (completely aside from other nutritional requirements) would be some 4.5 million tons of wheat per year, assuming no waste.

At the best recently-reported annual production (1999), total national wheat production was 2.5 million tons, or slightly over half (56%) of today's minimal needs. During the recent drought, production has been down significantly from this level.

Rural families reportedly average about 7 children, for a family size of 9 persons. Each family would thus require 1.62 mt of wheat per year. Average irrigated wheat yield was reported to be 1.13 mt/ha. Thus, each family would thus require 1.44 ha of irrigated land for wheat alone, simply to satisfy family needs for wheat. Again, this assumes average crop yields, no loss to locusts, aphids, diseases, etc., in the field, or to rats or insects in storage.

Reportedly some 1,200,000 ha of land have been devoted annually to wheat production in the last few years. At reported yield levels of 1.13 mt/ha, this is a production potential of 1,356,000 mt.

Typical rural family land holdings available for wheat production are reportedly 3 jeribs (2 jeribs = approx. 1 acre, 5 jeribs = approx. 1 ha). At 5 jeribs/ha, the family's land to provide its own food needs would be 7.2 jeribs for wheat, plus the land required to produce other foodstuffs and livestock feed.

On a national basis, at 0.16 ha per capita to produce the needed wheat, some 4,00,000 ha would be needed for a present population of 25,000,000. The total land area devoted to cereal production (wheat, rice, maize, barley) in 2000 (a drought year) was 2.38 million ha, and 2.77 million ha in 1998.

Total wheat production required (at 180 kg/year/person) would be 4,500,000 mt. Pre-war (1978-81) total cereal production was reported as 4,060,000 mt.

The additional land is clearly not available. Even if it were available, the typical family apparently does not have the means to cultivate it.

This is in addition to land needed to produce (1) other family nutritional needs and (2) production for market to earn income to purchase other family needs and food requirements.

X.3 THE NEED-INCREASED PER-CAPITA RURAL INCOME

Current production systems, cultural practices, and yield levels cannot meet the needs of the present population for either basic foodstuffs, or marketable goods adequate to generate the minimum required income and purchasing power. Further, a high rate of population growth is reported.

Clearly, a "subsistence agriculture" in which families are more-or-less self-sustaining, and can produce their own food and other needs is not possible, and is not a viable solution to Afghanistan's current critical needs.

Last available estimate of GDP (Gross Domestic Product), and the same figure for income, was $300/capita. On the basis of a family of 9 persons, this is $2,700.

In order to calculate minimum family income needs-in addition to short-term food from own-grown crops-if $10/month/capita is allowed for additional nutritional needs, farming supplies, medical/ dental, etc., or $120/year/capita, for a family of 9 persons, an additional $1,080, or less than half of per-capita GDP (potential, at this stage) would be needed.

X.4. MARKET ECONOMY

How can at least a large portion of Afghanistan's rural population earn this money to supplement the family-produced food?

A market economy, as contrasted to a subsistence agriculture as presently exists, must be created and must include at least the majority of farm families. This means that the farm family must produce for the market, or be employed in the marketing of farm and other products. This would require a major shift from present economic conditions; it must create:

1. Earning opportunity situated so as to permit employment while still living in the village, and

2. Either off-farm employment or on-farm production-for-market capability adequate to generate the required supplemental income.

This would require:

1. Industrialization (such as in Taiwan) by moving factories to rural areas, so people could live at home on the farm and still work in factories, and/or

2. Increasing farm productivity so that family food needs could be produced on less land, and then devoting the excess land area to producing a high-value, low-volume crop which could be sold to a local market outlet which would then export the crop commodity.

This would convert the existing "subsistence agriculture" into a "market agriculture", at least for the commodities produced for the market.

X.5. GENERATING INCREASED FARM FAMILY PRODUCTION INCOME

To enable rural families to produce basic family food needs plus production for the market would require:

It may also require some family planning effort, to keep population growth within some sort of stable economic relationship to the available cropland.