Poverty Reduction in Africa : On Whose Development Agenda ?

Lessons from Cotton and Gold Production in Mali and Burkina Faso

While poverty reduction is at the forefront of the World Bank’s mission, some of its policies require substantial trade-offs between economic growth and poverty reduction. This paper argues that World Bank policies promoting privatization of the cotton sectors while encouraging the expansion of gold mining across Mali and Burkina Faso may undermine poverty reduction efforts in both countries. Even though gold now generates more export revenues than cotton in Mali and is destined to do so in Burkina Faso, cotton generates substantially more benefits to poor sectors of the population than gold. Cotton sustains well over five million people in both countries, strengthens food security, and generates strong backward and forward linkages to the rest of the economy - contributions unmatched by gold mining. However, current reforms are undermining the cotton sector, while promoting the expansion of mining without the institutions to ensure that, at a minimum, local communities do not bear the costs of environmental degradation. Findings suggest caution in assuming the link between export-led growth and poverty reduction and stress the benefits of continued policy space for national governments and of pacing liberalization.