The Center for Global Development and Sustainability

Sustainable Livelihood Diversification and Poverty Reduction

A vegetable farmer in Lembang, Indonesia, walks through the mengrap vegetable fields with two bottles of drinking water. © 2004 Kusnadi Kusnadi, Courtesy of PhotoshareClimatic variability and consequent change is perceived to have become an increasing threat to rural and urban livelihoods in the Sahel and Savannah regions of sub-Saharan Africa and the arid, semi-arid and sub-humid regions of Asia.

Livelihood diversification activities have become an important income-generating strategy for rural small farm households throughout the developing world. Although these are found to account for only part of the total income of rural small farm households, the diversified non-farm sector has gained in importance for rural household economies (Assan 2014, Assan and Beyene 2013, Rigg 2006, Bryceson 2004).

It has been argued that households adopt livelihood diversification strategies in an attempt to generate livelihoods and enterprises that can cope with and recover from stress and shocks, and in this way maintain and enhance their capabilities and assets both for the present and the future (Escobal 2001, Barrett et al. 2001 and Ellis et al. 2003). Diversification in this context is argued to open avenues for growth by providing extra incomes and resources that would otherwise be absent from the household (Ellis et al. 2003).

The program seeks to examine the impact of rural livelihood diversification to non-farm enterprises within small farm households to ascertain whether such enterprises result in wealth accumulation and improvement of well-being. The program also aims to work with CBOs to develop effective mechanisms and programs that will enhance the profitability of diversified enterprises, improve security of livelihoods and enhance poverty reduction.