Transcript Agricultural Development and Food Security in Sub

Agricultural Development and Food
Security in Sub-Saharan Africa
Building a Case
for
More Support
(WELDEGHABER KIDANE)
THE PROBLEM
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almost 33 percent - close to 200 million
people, undernourished
Nearly half live on less than $1 a day - lower
than three decades ago
Number almost doubled since the 60s
highest increase of number of poor
observed in SSA - rose by 72 million during
the last decade
Poor performance of agriculture lies at the
heart of the problem.
PROBLEM Cont...
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food crises and famines, easily triggered by
lightest of droughts, floods, pests, economic
downturns or conflicts.
only continent where hunger is projected to
worsen unless drastic measures are taken
agricultural exports have fallen while
imports of food have surged
food aid interventions common feature of
African news headlines
Structural Adjustments
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implemented 1980s - 1990s to
redress policies that taxed agriculture
heavily
Impact Mixed
– Liberalization removed deliberate price
discriminations
– provided (in theory) incentives efficient
resource allocation
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Terms of trade for agriculture
Context & Objective of
Study
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In July 2003, AU resolved, to allocate
10% of budget
translating commitment into political
action not easy due to
Objective of study: to provide sound
arguments for ministers
Declaration is just
Maputo
Components of the study
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Background Document
Country case studies 10 countries: Chad,
DR Congo, Ethiopia, Ghana, Kenya, Malawi,
Mali, Nigeria, Tanzania and Zambia;
Main Reportg: Outlining Boarder policy
and strategy options for Africa
Two regional workshops in partnership
with AU/NEPAD Sec and RECS
KEY ISSUES
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Can agriculture in SSA be an engine
for broad-based economic growth?
What should be the role of the public
and private sectors?
What would be the optimum level of
government engagement
Structure of the Main
Report
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Introduction
Food security and nutrition in SSA
Strategic options for poverty and food
insecurity reduction
Agr performance in SSA
Constraints and Opportunites
Success stories in and outside SSA – lessons
learned
Where do we go from here
CONSTRAINTS TO
SUSTAINABLE AGR.
DEVELOPMENT IN
SSA
CONSTRAINTS TO SUSTAINABLE AGR.
DEVELOPMENT IN SSA
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Political unrest and armed conflicts
Non-conducive policy environment and
poor institutional framework
Policies failed
Limitation to expanding cultivated area
Limitations to improved productivity
Political unrest and armed conflicts
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Worst performers in terms of daily per capita calorie intake
during the period 1990 to 2002 were Burundi, Democratic
Republic of the Congo, Guinea-Bissau, Eritrea and Liberia.
Conflicts impact through:
–Diversion of budgets and human resources to defence and
internal-security
–Associated risk undermines private investment both domestic
and foreign
–markets and other services are disrupted
–infrastructure and private property are destroyed, and so on
–Agr. most affected.
political unrest and armed conflicts
Cont...
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Agriculture is often one of the most
affected sectors  Farmers most
affected
Rural populations are displaced - fields
unattended, with drastic consequences
Social ties and capital are dislocated
Non-conducive policy environment and
poor institutional framework
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Inadequate political commitment and action
Weak institutional capacity and structure for policy
programme/project development and
implementation
Policies not favouring agriculture and rural
development
Unstable macroeconomic environment
Legislative framework either weak, missing or not
properly enforced
undermines private sector involvement and
investment.
Why past policies including
SAPs did not work
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For some reforms under SAP not been fully applied
Others attribute failures to poor governance
– Strong executive, largely inefficient and often corrupt and
weak civil society organizations
– Macroeconomic stabilization policies broadly enforced but
expenditures on defence, internal security, diplomacy etc.
are protected
– public contracts awarded or managed in a non-competitive
way
– At times markets destabilized by deliberate misinformation
and unconvincing promises
Why policies failed ..
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Sudden public sector retreat following sweeping reforms in
the 1980s and early 1990s
downsizing of all public institutions - unable to maintain a
critical mass of professionals
loss of most experienced and competent staff to internal and
external competitors who offered better conditions of service
"brain-drain" of African -highly qualified Africans left the
continent for the West
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1960 to 1975 an estimated 27,000
40 000 between 1975 and 1984
60,000 between 1985 and 1990
average of 20,000 annually since the 1990s.
Weak Research Capacity
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Some basic figures on agricultural research in
Mozambique and Brazil
– Total number of staff in recently established Mozambican
Institute for Agricultural Research (IIAM) 902 people Only 2 percent of those are researchers hold MSc and PhD
degrees.
– Brazilian Agricultural Research Corporation (EMBRAPA); a
public corporation
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has 37 research centres and 3 service centres,
present in almost all 24 Brazilian states
8,169 employees - 2 221 are researchers with master’s
degrees and 53% with doctoral degrees
Average salary US$1 700 per month
Limitations to area expansion –
(a) Land Tenure System
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Insufficient security with communal and government
ownership to encourage private sector investment
Local chiefs custodians of land  distribution arbitrary
not favour external investors with capital and know-how
infringes on rights to access of community members
when powerful private investors exert pressure or bribe
local leaders
women's access not always guaranteed - forfeit upon
divorce or in the event of death of husband.
system does not allow for a land market  land
fragmentation and inefficient utilization
Limit to area expansion – (b)
Physical Availability
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Per capita land availability dwindling
– Population pressure and lack of alternative employment
opportunities,
– land degradation and desertification
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Most countries are land-constrained - Burundi, Ethiopia, Kenya
and Rwanda - yet recent production increases in some of
these countries attributed to area expansion
marginal, grazing and forest lands being switched to crop
production, with adverse effect on sustainable livelihoods and
the environment.
opportunities exist for area expansion in some SSA, provided:
– infrastructure is established to facilitate access
– measures put in place to protect land from erosion and
degradation
Other Limitation to Area
Expansion – (d) Mech. Power
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Low traction power . agriculture
dominated by a hoe culture
modest increase in trend in tractor use
remains still very low
more than 5 percent per annum
between 1961 and 1973
Only 2 percent and 1 percent 19731994 and 1995-2002, respectively
Limitation to area Expansion
– (e) Labour
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Farmers engaged in off-farm incomegenerating activities
The HIV/AIDS pandemic, especially in
Southern and East Africa,
(a) Limitation to Increased
Productivity - Water
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Recurrent droughts and increasing (7 countries in
19980/90 to 13 1991/03)
Investment in water harvesting and Irrigation still
inadequate
Irrigated agriculture not increasing 2.1% excluding Sudan
and South Africa, and 2.8 if SA included;
FAO estimates availability of sufficient water to develop ca
42.5 million ha under full irrigation
Only significant (>10%) in five countries; 25 countries
<2%
Potential high e.g. Eth 3.7 million Ha (2%)
Irrigation Africa Vs Other
Regions of the World
40.0
35.0
Latin Amer &
Caribbean
Percentage
30.0
Near East In
Africa
25.0
20.0
South Asia
15.0
10.0
Percentage
of Total Excl
SA
5.0
0.0
Total Inc SA
Avg 60s
Avg. 70s
Avg 80s
Period
Avg 90s-MR
(b) Soil Fertility
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Low input and low output technology
Average cereal yield 1.3 to 1.4 tonnes per hectare
ranges from 0.2 in Botswana to 4 tonnes per
hectare in Mauritius
Fertilizer application lowest in the world; yet soils
are generally poor
Average fertilizer use 35 Kg/ha in the 1980s;
declined to 26 Kg/ha in the 1990s
Reasons: increased price, subsidy elimination and
access to credit
Southeast Asia and Latin America, increased from
50Kg and 100Kg to 150 and 200 Kg, respectively
Soil Fertility Mgmt.
700.0
600.0
Index Wtd
Average
SSA
400.0
300.0
Index Wtd
Average
SEA
200.0
Index Wtd
Average
LA/CAR
100.0
20
01
19
97
19
93
19
89
19
85
19
81
19
77
19
73
19
69
19
65
0.0
19
61
Kg/ha
500.0
© Weak Research, Credit
and Extension Services
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Understaffed and under equipped research
and extension services;
Poor research/extension/farmer linkages
improved varieties account for 70% to 90%
yield increase in Asia and the Near East:
only for 28% in Africa
Credit services have failed
regional cooperation in research not
promoted (economies of scale)
Yield Comparison
3.5
3.0
Asia
Developing
Mt/Ha
2.5
Central
Africa
2.0
Eastern
Africa
1.5
1.0
Latin Amer &
Caribbean
0.5
Southern
Africa
0.0
1961-69
1970-79
1980-89
Year
1990-99
2000-M R
Western
Africa
(d) Marketing & Market
Access
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Transaction cost very high : a ton of maize
USA (11,000Km) to Mombassa US$45 to
US$48; Mombassa/Mbrara in Uganda
(1,500Km) ranges from US$ 125 to US$140.
rural transport costs e.g. Ghana and
Zimbabwe 2-3 higher than in Asia – Pak,
Indonesia and Srilanka
Road connectivity less than 2.4Km/1000
population; less than 40% are paved
Market failures the norms 
– weak and colluding private traders monopsony
– lack of information
(e) Deteriorating Terms of
Trade – Barter Terms of
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Farmers face low farm gate output and high input
prices (barter terms of trade)
Believed input prices escalated quicker than output
prices after SAP - currency realignments, subsidy
removal, tax reform and other changes
Deterioration of relative prices between inputs and
consumer goods e.g. Ethiopia, price of food
increased by 12% - 1995 to 2000, price of fertilizer
(DAP) increased by 76% and 8X for maize.
Deteriorating terms of trade more pronounced in
the 1980s
Deteriorating International Terms
of Trade for SSA main exports
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Slump of price of Arabica in 1986-1987, resulted in
a 40 percent fall in Ethiopia's terms of trade led to
6 percent drop in Ethiopia's real income
Imports about 15 percent of Ethiopia's national
expenditure,
Better for. food prices  reduction only ca 4
percent in US-dollar terms 1995 to 2004
same period, price of beverages - main exports - by
35 percent
price index for all commodities increased by nearly
50%
Terms of trade between agricultural
commodities and manufactured products
Indices
180
160
140
120
100
80
60
40
20
0
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
Years
All agri. Com.
Manufactured products (MUV index)
Terms of Trade
(f) Unstable and uncertain
input and output prices
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Year-to-year and price variations high, with adverse effects on
farmer incomes.
variation largely explained by lack of storage facilities and
absence of public sector price-stabilization measures such, e.g.
consumption credits and price support.
No mechanism put in place to ensure minimum farm gate
prices after SAP
agricultural demand rigid; prices are unstable small change
in the supplied quantity results in large differences in price.
“Smallholders ... much more vulnerable to global price
volatility
poor targeting and programme or project aid food aid
increases supply faster than demand  downward pressure
on prices
vicious circle of low income-low purchasing power of inputs
and low input application-low output-low income needs to be
broken.
(g) Declining trend in public
support to agriculture
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agriculture given a relatively low importance
on the political agenda of most SSA
countries
Evidence from case studies, 1990- 2001 
budgetary allocation low and declined from
ca 5 percent in 1990/91 to 3.5 percent in
2001/02
Highest proportional decline in Malawi 
from around 7% to only 4.2%
(h) Decline in official foreign aid
for agricultural development
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Decline in domestic public expenditure coupled by
decrease in foreign development assistance and
private sector investment in agr.
Globally OECD development aid in agriculture, rural
development first increased
from US$1 billion in
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1960 to more than US$30 billion in 1991, but
decreased to less than US$20 billion in 2000.
Aid to agr US$4.8 billion in 1989; slightly above
US$2.5 billion after 1997  insignificant vis-a-vis.
US$240 billion budget for CAADP
Asian tsunami showed public opinion in developed
countries much more easily mobilized for
emergency aid through spectacular media reports
SUCCESS STORIES WITHIN
AND OUTSIDE AFRICA
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Africa:
– Tea in Kenya;
produces about 16 percent of the world's black tea
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ranks second after Sri Lanka in tea exports, and third after
India and Sri Lanka in production.
smallholder sector accounted 62% in 2000
– Rice in Mali and Guinea
– Cassava in Central and West Africa
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Common Factors to Success:
Direct Public Sector Support
Conducive macroeconomic environment
Peace and stability
Success outside Africa
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Vietnam:
a significant exporter of coffee, rice, tea, cashew nuts and forestry products,
generating US$2.8 billion of export earnings.
Food production increased by 1.3 million tonnes annually
Diversification from food into industrial products
India:
Food-grain production increased from 50.8 million tonnes in 1950 to 176.3
million tonnes in 1990 and 206 million tonnes at the turn of the Century.
Self-sufficient with substantial reserve and exporting appreciable quantities of
wheat and rice.
Reasons for Success
Improving the functioning of agricultural markets, through the stabilization of
agricultural prices;
Public investment on research, infrastructure, water control and extension
services
Economic incentives to facilitate increase in agricultural labour productivity
Is support to agriculture
a profitable investment?
Answer
is yes;
E.g. Malawi 2002-2003 - total cost of
importing cereals (aid and commercial
imports), amounted to 788 539 tonnes at MK
15.6 billion
 If the money was invested in domestic
production, then the net production gain
would have ranged between 2,489,276 and
4,200,992
Conclusion
“food insecurity in Africa can be
explained by the fact that some
decision-makers believe that there
will always be ‘cold’ money
available in case of food emergency,
and that it is better to invest their
‘hot’ money into other activities”.
Prime Minister of Uganda