Women pictured in a field. Text on image says "JLIFAD. Investing in rural people."

International Fund for Agricultural Development: the Limits of Neoliberal Development Policy

Cover image courtesy of IFAD.

–by Adam Oberlitner–


As the most easily recognizable international organizations in the world and arguably among the most powerful, the United Nations has long endeavored to be a source of peace, cooperation, and international harmony. Although ensuring security was its primary aim at the time of its founding, the UN quickly became a mechanism for social and economic development, and among its first specialized bodies in this pursuit was the International Fund for Agricultural Development (IFAD). This article uses Benin as a lens to examine some of IFAD’s effects on poverty and food insecurity and to analyze the potential shortcomings of IFAD’s framework and the way its administrators choose to target recipients.


Established in 1977 as a result of the UN’s World Food Conference, the International Fund for Agriculture Development (IFAD) has aimed since its creation to ameliorate poverty worldwide with a strategy typified by the organization’s motto, “investing in rural people.” As IFAD notes on its website, 80 percent of the people living in extreme poverty across the globe live in rural areas, and in cases regarding Sub-Saharan Africa in particular, investing in rural agriculture is “up to 11 times more effective” in staving off poverty than “investment in any other sector.”[1] Small family farms play a major role in growing West African agriculture industries, and in a country with a rural population of 56 percent,[2] this kind of targeted aid has the potential to create far-reaching change in Benin. The promotional sections of IFAD’s website offer images of a promising future for its beneficiaries, but the reality for many in West Africa is often far less optimistic. The case study of Benin in particular helps to demonstrate what seems to be a contradictory state of affairs: despite steady economic growth since the beginning of the 21st century, the increasing spread of poverty has persisted, growing to 40 percent altogether from 2009 to 2015.[3] Food insecurity worsens throughout the country, as chronic malnutrition affects 34 percent of the Beninese population as of 2014, with an even higher prevalence among rural communities.[3] IFAD began their development work in Benin in the early 1980s[4] in response to the failure of rapid-modernization policies enacted in this period, resulting in an explosion in public debt.[5] This naturally begs the question as to why their nearly 40 years of project design has fallen short in their goal of building wealth and food security in the region. While little research outside of IFAD’s own offices has examined the organization’s work at length, an assessment of a few of its largest projects within the last decade can offer a glimpse into what improvements could be made in its developmental strategies. In IFAD’s work in Benin from 1981 onward, it’s clear that the organization’s major shortcomings are its overestimations of two key components of its strategy. It presumes financial access is the primary obstacle for struggling entrepreneurs and that giving marginalized women and youth job opportunities and a market to participate in will inevitably lead to social mobility and food security, which, as will be argued, is often not the case.

Microloans and the Market

From 1998 to 2005, IFAD began work on its Microfinance and Marketing Project, a program intended to bring market accessibility to Benin’s Collines province. As one of the agricultural zones farthest removed from the Beninese coastline, this province is unable to reap the same economic and infrastructural benefits as those closer to the country’s urban centers. The lack of land, training, or financial services in Collines has created a pattern of mass rural-urban migration that poses another threat to the region’s agricultural productivity.[6] As the foundation of this project, IFAD helped to establish financial services throughout the province, centering specifically around building access to credit and saving services. According to the project completion report, 80 percent of the beneficiaries of the project reported a “significant” increase in their incomes, and the project additionally helped to introduce innovative forms of food production that hadn’t been previously envisioned, such as pineapple or rabbit-raising.[7] While this particular project increased market accessibility as it had aimed, northern agricultural sectors continue to be the parts of Benin most strongly affected by poverty and food insecurity. The report also mentions that technological advances brought about through this program would allow for vegetable production in even the dry season,[7] which hypothetically could have provided massive relief to food-insecure people throughout Collines province. One possible fault in strategies such as this is the assumption that people can even participate in the market in the first place — regardless of how much easier it is for producers to bring their vegetables to market, this will fail to create larger-scale benefits if members of the broader community lack market accessibility. In Just Give Money to the Poor, Joseph Hanlon and his colleagues note that infrastructural approaches to development which focus on building up education or health often disregard the importance of whether or not the poor can adequately access such facilities in the first place.[8a] The same logic can be applied to market-based strategies. Regardless of what’s available on the market, consumers must have the financial capacity to participate in the market for it to yield any concrete change in nutrition quality.

Another key problem posed by this strategy is that it presumes access to financial services is enough to promote usage of credit and savings systems. While access to credit and savings can have positive outcomes for direct beneficiaries of aid–whose market entry is facilitated by IFAD and its cofinanciers–the benefits it yields for others is unclear. Access to savings can help to secure future investment opportunities for families which already have a large enough income to be able to store portions of it away. In the context of rural poverty, on the other hand, it can be very difficult to build savings for families required to spend any money they have available on food for themselves or on basic supplies for their crops or livestock. Credit poses even more complicated challenges, especially within the Beninese environmental context. Because many agriculturalists in the stretches of Benin far removed from the coast rely on rainfall to water their crops,[3] shifting drought and glut cycles provoked by climate change can dramatically alter production from one year to the next. As a result, taking out loans in order to begin an agro-entrepreneurial endeavor poses intense risk to anyone involved in microfinance. The unpredictability of rain-fed crop yields makes loan repayment equally dubious. IFAD’s recently approved Market Access Support Project will soon be implemented–at the time of this writing–to mitigate the risks of agro-entrepreneurship through insurance and climate adaptation.[9] However, what the organization describes as an “insurance scheme” may not necessarily be fiscally feasible for Benin’s poorest smallholder farmers. Depending on the form these initiatives take in the near future, efficacy may be undercut by IFAD’s emphasis on building up new dimensions of the private sector.

Sowing Inequality

On the other hand, the Beninese government has worked since the mid-1900s towards expanding its irrigation capacities to stabilize food production,[10] which may prove to be a more effective force of nutrition security in the region. Since 2015, IFAD has joined in on this effort through its Market Gardening Development Support Project, which aims at generating market resilience to adverse climate conditions. While this initiative partially aims to prevent flooding by constructing preventative dikes across southern Benin, this effort also intersects with government policy in the expansion of solar-powered pumps.[11] These irrigation systems can be particularly helpful during drought seasons since extended sun exposure leads to added solar energy output, which in this system can be exploited to bolster irrigation. Because the operation costs of solar-powered hydrological systems plummet after construction, some have argued that this is an ideal model for modernized irrigation in the Global South.[12] While low-maintenance solar-powered systems are a boon to the spread of irrigation and water in general across Benin, this initiative is not without its challenges. The location of its planned construction sites poses a problem when contrasted with the zones of impact for IFAD’s aforementioned Market Access Support Project. While the irrigational project is planned only for provinces already nearest to the urbanized coast, this other initiative includes the department of Collines.[9] This means that while microloan programs and these previously mentioned insurance schemes will stretch into Collines, IFAD does not plan to devote resources to extending irrigation technology past the province’s southern limit. While this is most likely a consequence of fiscal and technological limitations — as building such intricate infrastructure comes neither cheaply nor simply — the implication is that residents of the northern province will take on similar fiscal responsibilities to southern smallholders without the same infrastructural support. Infrastructure construction is highly limited by cost, so quick expansions into the Collines province may not necessarily be possible. In addition, what irrigation systems can be built across southern Benin have the potential to bolster the agricultural strength and food security of communities throughout the coastal region. However, the possible socioeconomic consequences of this infrastructural disparity are worthy of consideration. If agricultural stability increases dramatically in one region due to irrigation development before there are plans to begin building in a second region, the impacts of this divergence could affect economic outcomes for multiple generations.

Another aspect of IFAD’s work with potential intergenerational ramifications comes down to a matter of the organization’s targeting policies. Recognizing that there are often major structural disadvantages preventing women and youth from accessing resources such as land or education, IFAD’s targeting policy primarily aims to focus the economic benefits of its initiatives towards them.[13, 14] Although IFAD presents this as taking into account the social context surrounding its planned projects, these simple narratives often obscure complications that aren’t thoroughly addressed in the organization’s policy proposals. While Benin is a highly ethnically diverse country consisting of differing family traditions, women and young adults — particularly elder and eldest siblings — very frequently constitute a major share of a household’s reproductive labor. According to the latest information available through the UN, the average Beninese household is comprised of 5 members, with 66 percent of the country reporting families of 4 or more.15 While 78 percent of households have children under the age of 15, only 15 percent report having both young children and elderly members (reported as 60 and older) of the household.15 Many kinship systems are built around mutual caregiving between children and the elderly, but in this case, the vast majority of households cannot reliably lean back on such labor. Additionally, IFAD’s targeting policies often focus on female heads of household, who are noted to struggle with poverty more frequently than other women, as they frequently are the sole parent. Providing economic support and opportunities to impoverished women is vital for effective policies concerning gender equity. However, programs which aim to bring women and youth out of the home and into the field have the potential to disrupt or place added strain onto already stressed modes of reproductive labor, and IFAD does not appear to have accounted for this in its proposals and reports.

Another important dimension to consider regarding the organization’s targeting policies is the populations it chooses not to prioritize. While it is worth noting that the focusing of credit programs on women’s groups can exclude impoverished Beninese men from accessing the potential benefits of IFAD initiatives, another demographic unaddressed by these projects is the elderly of Benin. IFAD has noted in its own strategic assessment that older Beninese are particularly vulnerable to poverty and food insecurity,[3] but credit programs which favor youth and mothers explicitly fail to adequately address the needs of the country’s elderly. Many of the jobs created by IFAD’s initiatives rely on either physical labor or technological literacy, both of which pose obstacles to entry for older Beninese. These projects aim to create local economies capable of integrating with value chains on an international level, but with both credit and job opportunities directed away from the elderly, they effectively exclude older Beninese from these growing markets.


The chosen focus of IFAD’s developmental strategies–the rural poor–is an apt target for any program aimed at alleviating food insecurity across the globe. While the persistence of poverty in all stretches of the world–including Benin–have prompted the rise of countless intellectual traditions of economists and policy experts eager to test their own War on Poverty, the prevailing consensus of the day is that of neoliberalism. With its emphasis on the private sector to the exclusion of all other avenues, the ever-increasing prominence of neoliberalism has brought the field of humanitarianism into a new era of market- and data-based problem-solving. As the economic sensibilities of the Global North shifted away from the Keynesian welfare state in the mid to late 1900s, models of humanitarianism likewise transformed into the entrepreneurially-inclined visions typified by IFAD’s initiatives. Alongside this deemphasizing of the role of the state in both domestic and international aid was the burgeoning notion that global deregulation and worldwide liberalization could lead to a prosperous future for all. These politics intersect with the field of humanitarianism most clearly through organizations such as the International Monetary Fund and the World Bank, the latter of which has acted as a cofinancier for several IFAD projects.[4] Because these organizations have long pushed for a downscaling of government spending in accordance with neoliberal sensibilities, they have been criticized for their role in the manufacturing of global austerity and its impacts on local poverty levels. While IFAD has not played so dramatic a role in the global reification of neoliberalism, it’s vital to understand that it operates within the same logical framework. Primarily focusing on private sector partnerships, market creation, and economic growth allows IFAD to pursue sustainable and profitable solutions, but it also places constraints on what is considered within the realm of reality regarding the organization’s options for aid.

One of the ways these constraints are best illustrated is through the use of microloans and credit systems in general to build local economies. As mentioned previously, while taking up a loan can prove to be a livelihood-threatening risk for a poor person in any circumstance, agriculturally-oriented loans pose even greater challenges, especially in areas with rainfed crops. As a result, while creating credit infrastructure can sustainably bring gutsy entrepreneurs to their feet, its primary drawback as a mode of aid is that it fundamentally discourages people in need of financial assistance from accepting it. Hanlon et al. describe a cash transfer system in Mexico called Oportunidades which began direct payments to families in need. Notably, Oportunidades and programs like it have greatly reduced malnutrition in recipient families and consequently result in better health across the board.[8b] While microfinance programs require that the recipients invest in something which will immediately provide financial returns, social assistance programs allow recipients to freely and directly invest in things which may play more a foundational role in their lives, such as nutrition. A core difference between these two methods is that microfinance posits a model of aid wherein food security is the result of stable and independent income, whereas the social assistance model uses food security as a foundation to build into improved economic outcomes. By tending to issues of malnutrition, programs such as Oportunidades bolster recipients’ capacities to attend school or participate in subsistence or reproductive labor at home.

This broader approach can lead to improved economic outcomes for the entire household by freeing up funding and allowing investment into diverse outlets that fit a particular household’s socioeconomic context. While IFAD microfinance has been successful in changing the lives of many of its recipients, the changes are shaped and constrained by the fact that investments must be profitable quickly enough to pay back loans. Similar issues of “profitability” are illustrated by the exclusion of the elderly from many entrepreneurial initiatives. While the benefits of a growing jobs market could be extended to older Beninese by investing in tech literacy training for them, the time and effort involved in this endeavor when compared to how long they’ll be able to do labor illustrates why an organization focused on sustainability might be reticent to include them. The influence of neoliberalism in the broader humanitarian discourse effectively posits a mode of aid in which “help” is ultimately secondary to profit. IFAD’s initiatives, while successful in many respects, demonstrate clearly the limits of this neoliberal model of aid.

This post may have been edited by admin for clarity and length.

Works Cited

[1] “Why rural people,” IFAD Accessed 11/3/2018 https://www.ifad.org/web/guest/investing-in-rural-people

[2] “Benin,” IFAD, accessed 12/8/2018 https://www.ifad.org/en/web/operations/country/id/benin

[3] Country of Benin: Country strategic opportunities programme, 2018-2022,” IFAD.

[4] “Rural Development: Borgou Rural Province Development Project,” IFAD. Accessed 11/3/2018. https://www.ifad.org/web/operations/project/id/61/country/benin

[5] “Historical Public Debt Database,” International Monetary Fund, accessed 12/10/2018.

[6] “Credit and Financial Services: Microfinance and Marketing Project,” IFAD. Accessed 11/5/2018 https://www.ifad.org/web/operations/project/id/1028/country/benin

[7] “Project Completion Digests – 2008,” IFAD.

[8] Hanlon, Joseph et al. Just Give Money to the Poor: The Development Revolution from the
Global South
. Boulder, Kumarian Press, 2010.

[8a] p. 11

[8b] p. 53-54

[9] “Rural Development: Agricultural Development and Market Access Support Project,” IFAD. Accessed 11/14/2018. https://www.ifad.org/web/operations/project/id/2000001073/country/benin

[10] Nonvide, Gbetondji Melaine Armel. “Irrigation adoption: A potential avenue for reducing food insecurity among rice farmers in Benin,” Water Resources and Economics, vol. 24 (2018): p. 40-52.

[11] “Proposed loan and grant to the Republic of Benin for the Market Gardening Development
Support Project,” IFAD.

[12] Roblin, Stephanie. “Solar-powered irrigation: A solution to water management in agriculture?” Renewable Energy Focus, vol. 17, no. 5 (2016): p. 205-206.

[13] “Gender,” IFAD. Accessed 11/21/2018 https://www.ifad.org/web/guest/gender

[14] “Youth,” IFAD. Accessed 11/21/2018 https://www.ifad.org/web/guest/youth

[15] “Household Size and Composition Around the World 2017,” United Nations Department of Economic and Social Affairs Population Division, 2017.

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