The paper summarizes the concept and major results of a regional programme monitoring the linkages between adjustment and rural poverty in Mozambique. While liberalization has considerably improved the regular supply of consumer goods in rural areas, agricultural price policy has not yet succeeded in improving the terms of trade of the farmers. No significant changes in real incomes, and the income distribution, of the poor smallholders were recorded. High transaction costs and low supply elasticities impede the growth of agricultural production. Social services are structurally deficient, but a significant negative impact of adjustment cannot be established.
