Grassroots Movements as a Means to Overcome Rural Financial Market Failures

Abstract

In many developing countries dynamic growth is accompanied by a growing income disparity between urban centers and rural areas. Rural areas often remain centers of poverty with underdeveloped infrastructure, poor school and health facilities and few diversified production activities. Regional development concepts need to be expanded to give proper priority to strengthening rural urban linkages and complements. These include:

• sustainable productivity increase in agriculture in rural areas (agricultural research for rural area problems, extension, rural credit);

• infrastructure and institutional development to facilitate access to agricultural inputs, equipment and services;

• processing and marketing facilities and their link-ups to urban facilities and markets;

• development of non-agricultural activities in trade, transport, tourism etc.