The Organization for Economic Cooperation and Development (OECD) on Friday officially launched a new publication Agriculture Policies for Poverty Reduction, aiming to help the poor better their lives through raising rural incomes.

According to the book, with more than two-thirds of the world's poor living in rural areas, higher rural incomes are a pre-requisite for sustained poverty reduction and reduced hunger.

The study shows that higher incomes are essential for sustained progress on the first Millennium Development Goal (MDG1), which calls for the eradication of extreme poverty and hunger, and includes a specific target of reducing by 50 percent between 1990 and 2015 the proportion of people living on less than a dollar a day.

The report sets out a strategy for raising rural incomes which emphasises the creation of diversified rural economies with opportunities within and outside agriculture. It also identifies ways in which the appropriate set of policies may vary according to a country's stage of development.

In the short to medium term, there is a need to raise the basic incomes of the poor and to strengthen systems of social protection.

With farming is a core economic activity in the poor rural areas, this implies policies and investments that raise economic returns within agriculture.

In the long run, there is a need to anticipate the structural changes in agriculture that accompany successful economic development.

The report reminds that many of the policies required to improve farmers' opportunities are nonagricultural. Improvements in education and primary healthcare are key to prospects within and outside the sector.

Equally important is the overall investment climate, which depends on factors such as peace and political stability, sound macroeconomic management, developed institutions,property rights and governance.

Agricultural policies need to be integrated within an overall mix of policies and institutional reforms that facilitate, rather than impede, structural change, the report stressed.

It indicated that by investing in public goods, such as infrastructure and agricultural research, and by building effective social safety nets, governments can limit the role of less efficient policies such as price controls and input subsidies.

The report warns that there are dangers in using market interventions to address multiple economic and social objectives. Such programs can become an easy target for interest groups, outliving their original justification and becoming a budgetary millstone.

An important priority is that expenditures on market interventions should not crowd out essential investments in support of long-term agricultural development, the report concludes.