New study identifies priorities for agricultural development in Guatemala

29.02.2024
 

A recent study published in Spanish by FAO and entitled “Tipología de microrregiones en el sector agrícola de Guatemala: Una herramienta para priorizar inversiones en el marco de la Iniciativa Mano de la Mano” has unveiled an in-depth analysis of microregion typologies for agricultural production in Guatemala, as part of the Hand-in-Hand Initiative.

Utilizing up-to-date data on agricultural production, climate, geography and poverty, researchers have constructed a standardized classification of territories. This classification combines the potential of national agrifood systems with the efficiency of producers to generate income in areas where poverty is prevalent.

The comprehensive study has shed light on prioritizing territories and differentiating strategies based on two key points. Firstly, each territory possesses unique characteristics, necessitating varying degrees of priority. Secondly, as a complement to the former, investment types and public policies must align with the socioeconomic dimensions and specific needs of each territory or region. This territorial prioritization is based on three components: potential, efficiency and poverty.

• Potential: Under the stochastic frontier model framework, potential refers to the maximum incomes achievable by a producer given observed prices, climatic conditions, and land use. The study reveals that territories with high potential are more likely to benefit from short-term agricultural investments, with higher returns. Conversely, areas with low potential are clustered in specific regions, suggesting the need for focused interventions to alleviate poverty.
   
• Efficiency: The efficiency component measures the unrealized potential of territories, specifically the technical efficiency that reflects farmers' abilities to exploit market opportunities given their skills and capabilities. Interventions in areas with high unrealized potential are believed to have a greater impact, as they present opportunities for closing the gap and boosting agricultural growth.
   
• Poverty and microregion typology: The study identifies areas characterized by efficiency, potential, poverty and chronic malnutrition, and then overlays these layers to classify territories into seven categories. Territories with high potential and low efficiency, for instance, require focused investments in training, financial services, and organization to maximize agricultural potential.

Regarding policy and investment priorities, differentiated strategies and territorial prioritization are guided by the microregion typology categories. Concrete interventions are suggested based on the unique characteristics and conditions of each territory in terms of agricultural potential and efficiency.

These findings serve as a guide for investment and policy interventions aimed at accelerating agricultural transformation and sustainable rural development in the country. By adopting a territorial approach, decision-makers can prioritize interventions and policies effectively. However, it's crucial to note that typology maps are just one prioritization tool among many and should be complemented with specific analyses such as value chains’ characterization, field validation, financial and fiscal viability, environmental sustainability, and inclusion in social sustainability. Moreover, discussions with local governments are essential as these results may not fully capture the intricacies within each territory or region.

Overall, this study contributes to the planning and design of investment programmes and projects for Guatemala's agricultural sector and guides the country's public policies. These insights are invaluable for local and national policymakers, international financial institutions, donors, civil society, private sector entities, international cooperatives, research institutes and other United Nations agencies.