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OECD Review of Agricultural Policies: Chile 2008

image of OECD Review of Agricultural Policies: Chile 2008

This Review measures the level and composition of support provided to Chilean agriculture, and evaluates the effectiveness of current measures in attaining their objectives. The study finds that Chile provides much lower support and protection to its agricultural sector than most OECD countries, even though government expenditures on the sector have trebled in real terms over the past ten years. About half of that spending is on public goods such as infrastructure and irrigation, while the other half consists mostly of measures that seek to make Chile’s poorer farmers more competitive.

This report suggests ways in which the effectiveness of these policies might be enhanced, including by systematic evaluation of policy performance, by closer co-ordination across government agencies, and by framing policies for smallholders and salaried farm workers in an economy-wide context, so that agricultural policies can focus on potentially competitive farmers and be effectively distinguished from other development and social policies.

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Development Pathways for Agriculture-dependent Households

Chile’s agricultural sector has grown rapidly in the past 20 years. This growth has been associated with important structural changes, notably in the agro-processing sector, the logistics of food distribution, and the system of food retailing (the rise of supermarkets). Not all farmers have been able to adapt to these changes, and as a consequence there has been a widening gap between the country’s commercial export-oriented sector and a traditional agriculture that produces staples for own consumption and importable crops such as wheat.

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