Abstract
Improving the livelihood of the many rural-based people living in developing economies calls for a rural transformation. Policymakers primarily focus on increasing agricultural productivity, i.e., fostering a green revolution. Although this is key to initiating rural transformation, evidence shows that high productivity alone does not necessarily attract investments in other parts of the value chain. These investments are vital to improving smallholder livelihoods through creating non-farm employment opportunities. Therefore, this policy brief calls for a more holistic approach to successfully initiate and support rural transformation. This approach seeks to build a farm ecosystem where smallholders, medium-scale, and large-scale farmers work symbiotically and thus send strong signals that can attract investors in other parts of the value chain. Such a system can guarantee consistency in quality, quantity, and stable prices. Specifically, this brief also argues that government efforts at improving the investment climate through the investment in rural infrastructure and especially through the building of agro-industrial parks and emphasizing building skills are a key part of solving the rural transformation puzzle.
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