NEW ORLEANS - After years of neglect, Latin America must once again turn its attention to rural development and implement a new strategy for reducing rural poverty and spurring agriculture, agribusiness and non-farm activities, declared IDB President Enrique V. Iglesias today.

"In the last decades it seems that we have forgotten about the issue of rural development," said Iglesias at the opening session of the seminar "Development of the Rural Economy and Poverty Reduction in Latin America and the Caribbean."

"New, important themes found a place on the development agenda, such as political reforms, modernization of the state, social development, microenterprise, trade, and many others," he said.

"But today, we realize that it is not possible to produce sustained growth and sustainable development without investing in the agriculture sector. It is not possible to reduce rural poverty, nor urban poverty as well, without investing in the rural economy."

The aim of the seminar was to discuss a new approach to rural development based on a broad, multisectoral vision, which is the subject of a strategy prepared by the IDB. The strategy acknowledges the great diversity of conditions from one area to another in Latin America and the Caribbean, as well as alternative economic opportunities in rural areas. In addition to agriculture, these alternatives include tourism, industry and handicrafts. Rural development policies must also take into account migration to urban areas, as well as social networks for those who remain and the need to reduce inequities due to gender and ethnicity.

The seminar, which was sponsored by the Government of Denmark, was held in conjunction with the Annual Meeting of the IDB’s Board of Governors, whose formal sessions start March 27.

According to Iglesias, the new focus on rural development must recognize the sector’s great economic importance. Despite the growth of other sectors, agriculture and agroindustry in many countries accounts for 30 percent of gross domestic product. "We must keep in mind the potential impact of rural investments to generate employment, increase exports, reduce rural and urban poverty and substantially improve the use of natural resources," said Iglesias.

The day-long seminar included presentations by public and private sector experts as well as ministers of agriculture from several Latin American countries. As part of the event, seminar participants will visit an agricultural research station, the Louisiana State University campus in Baton Rouge, rural community development projects, a small farm and an agribusiness firm.

In addition, representatives of six international agencies today signed the charter agreement of the new "Interagency Group for Rural Development in Latin America and the Caribbean." The new group will step up efforts to share information and experience and carry out joint activities at the regional, subregional and national levels. Signing the agreement were the IDB, the Inter-American Institute for Cooperation on Agriculture, the United Nations Food and Agriculture Organization, the Economic Commission for Latin America and the Caribbean, the International Fund for Agricultural Development and the German Agency for Technical Cooperation.

Also speaking for the IDB was Sustainable Development Department Manager Waldemar W. Wirsig, who documented the serious and increasing problems rural areas face in the region. Between 1994 and 1997, he said, the percentage of rural households in the region living in poverty dropped only slightly, from 56 percent to 54 percent. Overall, rural poverty is worse now than in 1980.

"This shows that we have not achieved convincing gains in the fight against rural poverty," said Wirsig. "The slight improvements achieved in some cases have been due more to high rates of migration that to a closing of the gap between living conditions in rural and urban areas."

From these failures, a number of lessons can be drawn, said Wirsig. For one, rural poverty can not be reduced through global strategies or mere economic growth. Another is that rural development programs do not produce results without economic policies that permit profitability in the agricultural sector.

"And we have particularly learned that limited participation by beneficiaries in development programs resulted in projects that did not address real needs," he said, emphasizing the need for contributions by women, youth and indigenous people.

Wirsig enumerated a series of measures needed to reverse the trend, among them:

· Reform public policies that discriminate against rural development.

· Modernize the public sector and its ability to provide basic agricultural services.

· Promote nonagricultural activities through tax and financial incentives to attract private investment.

· Provide secure land ownership.

· Strengthen financial services in rural areas.

· Improve natural resource management.

Also speaking at the seminar was Torben Brylle, undersecretary of the Royal Danish Ministry of Foreign Affairs, who emphasized the need to protect the environment. "Degradation of the land does not only result from by agricultural practices by small farmers, but also from over-exploitation by large farms," he said. He called for stronger measures to protect the environment from agricultural, forestry and mining operations.

Speaking for the United States, Jill Long Thompson, undersecretary of Agriculture for rural development, described her government’s Rural Empowerment Zone program. The key to the program’s success, she said, was local participation. Local communities first must overcome internal differences and draw up a common strategy. Then the government comes in help create economic opportunities, creating real jobs in the private sector.