As someone who has family that still farms: the amount of equipment required to allow only 1% of the population to grow food is enormous. Are you seriously suggesting that it will be a trivial thing for farms that currently rely on manual labor to switch to large-scale mechanized practices? Most farmers I know have >1M USD in equipment, along with the required infrastructure to handle shipping/storing the crop.
So I don't see how they can avoid a process similar to what occurred for western farmers starting ~1900. They don't need to be competitive on a global scale, they need to find a profitable niche in their own countries. Additionally, increasing employment seems far preferable; likely developing local economies is the best way to increase standards of living rather than relying on foreign aid.
Also note that there are many crops even in the US that heavily rely on hand labor (typically fruit/vegetables). While it may not be feasible to compete with imported grains, I can certainly see how local farmers could effectively compete for these crops- which would likely also increase the diversity of foods avaliable in local markets.
How is it anything but a net positive for them to develop local industries; the increased economic output is likely to improve the entire local economies and doesn't rely on foreign aid (which can suppress long-term economic development).