Ecuador - Agricultural review (Vol. 1 of 2) : Main report

I1T1 A Ic TI Report No. PA-92a This report is for offleial us only by the Bank Group and apelaeUy authorized arpniatlons or persons. It may not be published, quoted or cited without Bank Group authorluton. The Bank Group does not acoept respondbility for the accuracy or complbteneu of the report. INTERNATIONAL BANK FOR RECONSTRUCT1ON AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION AGRICULTURAL REVIEW ECUADOR (in two volumes) VOLUME 1 THE MAIN REPORT July 22, 1972 Agriculture Projects Department  BACKOROUND DATA us$ 1.00 . . . . . . . . . . . . , a . . . . e . .. 25 stores One sucre (S/) . . . . . . . . . . . . . . . . . * a US$ 0.04 Population (1969) .. .... ......... 0 6 million Labor Force (1969) . . . ..a. 2.9 million Agricultural Labor Force aa Percent of Total Labor Force (1969) . . . . . . . . . . . . 9. 61% Growth Rates (annual compound, 1960-69): Population (Total). . . . . . . . . . . . . . . . . 3.4% Population (Rural). . . . . . . . . . . . . . . . . 2.7% Agricultural Labor Force . . . . . . .. . .. . 0 2.5% GDP at. Factor Cost (1969). . . . . . . . . . . . .. .0 27,425 million sucres Per Capita GDP at Factor Cost (1969) . . . . . . . . . 4,570 sucres Contribution of Agriculture, Forestry and Fisheries to GDP (1969) .... . . . . . . . . . . 31% Growth Rates (annual compound, 1960-69): GDP ..... . . . . . . . * . 4.6% Contribution of Agriculture, Forestry and Fisheries to GDP . . . . . . . . . . . . . . . 2.7% Balance of Payments -on current account, 1969) . . . . US$ -87 million Index of Wholesale Prices (1954 = 100): All Products (o1968) . . . . . . 0 . . a . 0 . 120 Food Products (1968) ............... . 115 Main Agricultural Exports . . . . . . . . Bananas, coffee, cacao, sugar Main Agricultural Imports . . . . . . . . Wheat, cotton, tallow, vegetable oil and oilseeds, tobacco Agricultural Excports (1969). . . . . . . . US$ 175 million Agricultural Exports as % of Total Merchandise Exports (1969). . . . . . . . . .. . . 93% Agricultural Imports (1968) . . . . . . . . . US$ 50 million Agricultural Imports as % of Total Merchandise Imports (1968) . . . . . . . . . . . . . 24% Number of Farms (1968) . . . . . . . . . . .. . . . 633,000 Area in Farms (1968) . . . . . . . . . . . . . . . . . 6.9 million ha Size of Farm (Arithmetic Average, L968) . ...... . 11 ha ;ize of Farm (Modal Average, 1968) . . . . . . . . .... 1.9 ha Area in Crops (1968): Annual Crops . . . . . . . n * . * * ' 1.22 million ha Cemi-permanent Crops . . . . . . . . . . . . . . 0.40 million ha Permanent Crops . . . . . . . . . . . . . . . . . . 0.58 million ha Fallow .... . . . . . . * ..... . . . . . . . 0.44 million ha Total Crop Land . . . . . . . . . . . . . . . . . . 2.64 million ha Area in Pasture (1968): Natural ..... . . . . . . . . . ... ... . 0.86 million ha Cultivated ... .. .... . . . . . . 1.18 million ha Total .... . . . . . . .. . . . . . . . . . . 2.04 million ha 1 kilogram (kg) - 2.20 pounds meter - m 1 hectare (ha) - 2.47 acres ton - metric ton 1 quintal (q) - 100 pounds $ - US dollar mm * millimeter  TABLE OF CONTENTS Page No. VOLUME I (MAIN REPORT) SUMMARY AND GENERAL RECOMMENDATIONS ................... i-v I. RECFNT TRENDS IN AGRICULTURE .......1 Output . ........................................... 1 Foreign Trade ............ 1 The Supply of Labor and Land ..... ................ 2 Technical Change and Modern Inputs ............. - 3 Other Key Developments ...... ...................... 5 Conclusions .......... ............................ 6 II. THE ECONOMIC ENVIRONMENT OF FARMERS ................... 6 The Supply of Credit ............................. 6 The Supply of Information ..... ........... 9 Product Prices and Marketing Costs ............. .. 11 Taxation ....... ........... .. ..................... 13 Conclusions ....... ......... .. .................... 16 III. THE GOVERNMENT AND RESOURCE DEVELOPMENT .... ........... 17 Land and Water ............... .. .................. 17 Rural Roads and Electrification ........ .......... 22 Forests and Fisheriea ........... .. ............... 23 Conclusion ................... .................... 27 IV. THE LOW INCOME PROBLEM IN AGRICULTURE .... ............. 28 Agricultural Cooperatives ......... .. ............. 28 Rural Health and Family Planning ........ ......... 30 Land Redistribution and Settlement ....... ........ 32 V. IMPROVING DEVELOPMENT STRATEGY ........................ 34 The Demand for Farm Products ........ .. ........... 34 Production Capacity ............ .. ................ 35 The Changing Economy ..... ........................ 36 Population Growth and the Rural Poor ...... ....... 38 Needed Changes in Strategy ......... .. ............ 40 VI. MOBILIZING FOREIGN SUPPORT ............................. 42 Foreign Aid -- A Resume .......... .. .............. 42 Making Foreign Aid More Effective ....... ......... 44 The World Bank Group and Project Possibilities ... 47  MAP S 1. Natural Regions and Rainfall Distribution 2. Irrigation Projects and Proposals 3. Location and Stucly Zones, Guayas Basin VOLUME II (ANNEXES) 1. Recent Economic T'rends 2. The Natural Resource Base for Agriculture 3. Problems of the Sevenities 4. Commodity Notes Cereals Tuber Crops Pulses and Oil Crops Fiber Crops Cacao and Coffee Tea and Sugar Fruits Miscellaneous Crops Livestock and Poultry 5. Land and Water Development 6. The Loan Recovery Rate of the National Development Bank 7. The Supply of TechLnical Staff S. The Cooperative Bank 9. Agricultural Processing Industries 10. The Water Laws 11. Agricultural Statistics and Planning 12. Foreign Loans in Agriculture Statistical Annex (with list of tables)  SUMMARY AND GENERAJ. RECOM