Inadequate agricultural capital

Other Names:
Low investment in farms
Lack of agricultural capital
Insufficient land funds
Unavailability of farming capital
Limited availability of farm loans
Unfinanceable new farms
Inadequate agricultural funding base

[Developing countries] Agricultural diversification would involve purchasing more machinery, hiring more labour and increasing the amount of both labour and capital needed to manage a more complex operation. Without creating a financial reserve, there can be no loan structure, credit union or bank. In many small communities, despite an intensive drive for capital resources, the low income generated by most family production units means that they are unable to generate new capital, and they struggle to purchase supplies and to market products on their own. Subsistence-level income and lack of community capital prohibits investment, since an immediate return on investment cannot be assured and the tax base of land owners is often too low to support the building of necessary facilities or provide local fire, police and ambulance services. The limited availability of resources leads people to clear the land with only what is at hand, and market only the crops one person can carry into the village to sell.

Narrower Problems:
Insufficient loan collateral
Related UN Sustainable Development Goals:
GOAL 2: Zero HungerGOAL 10: Reduced InequalityGOAL 15: Life on Land
Problem Type:
D: Detailed problems
Date of last update
04.10.2020 – 22:48 CEST