Transcript Post-Harvest Innovations Project

Post-Harvest Innovations Project
Policy Review
23rd November 2005
Presented by Steven Semgalawe
Policy Review Objective
The aim of the policy review is to develop and
present a clear picture of how present policies
and the dynamics associated with their
formulation and implementation have or will
have bearing on the post-harvest situation in
Tanzania and the national post-harvest
innovation system.
Approach and Methodology



Consultative meeting with Post-Harvest
Innovations Project Officer
Desk review and analysis of various policy
documents
Preparing and submitting a draft report to the
Post-Harvest Innovation Project Officer.
Review of Relevant Documents

Various documents were reviewed. These included:
–
–
–
–
–
–
–
–
–
–
The Agricultural Policy
Agricultural Development Strategy
The Land Policy
The Cooperative Policy, Water Policy and Taxation Policy
Trade Policy
Local Government Reform Programme
The Tanzania Development Vision 2025
Poverty Reduction Strategy Paper (PRSP)
Agriculture Sector Development Programme Framework
Doc
Agricultural Extension Vision 2000
The Agricultural Policy

Agricultural policy provides the government
decisions that influence the level and stability of
food security and farm incomes
–
–
these decisions are aimed at influencing the output and
input prices, public investments affecting agricultural
revenue and costs, and allocation of research funds to
improve farming such as in areas of development of post
harvest technologies
The Policy seeks to ensure that the direction and pattern
of development in the agricultural sector meets economic
and social objectives and outputs.
The Agricultural Policy Cont…


The policy emphasizes on the importance of
competitive markets, with the Government
providing priority public goods and services
and the conservation of the environment as a
rational basis for agricultural development.
The focus of the policy is on how the
Government deploys these services to support
the private sector in promoting growth and
commercialization in the sector.
The Agricultural Policy Objectives
The policy objectives are:
 To improve standards of living in the rural
areas through increased income generation
from agricultural production, processing and
marketing;
 To increase foreign exchange earnings for the
nation by encouraging the production and
increased exportation of cash crops
The Agricultural Policy Objectives
Cont…


To produce and supply raw materials, including
industrial crops while also expanding the role
of the sector as a market for industrial outputs
through the application of improved production,
marketing and processing technology;
To develop and introduce new technology
which increase the productivity of labour and
land
The Agricultural Policy Objectives
Cont…
To promote integrated and sustainable use
and management of natural resources such
as land, soil, water and vegetation to
conserve the environment;
 To develop human resources within the sector
in order to increase the productivity of labour
and to improve ability, awareness and morale;
 To provide support services to the agriculture
sector, which cannot be provided efficiently by
the private sector.

Policy Statements Specific to PostHarvest Interventions


The Government will encourage the formation of
common interest groups (youth, women, retired
officers, etc) to pull resources in order to establish
and carry out agro-processing activities;
The Government will encourage the private sector,
NGOs and other funding organizations to
participate and support agro-processing activities
by ensuring availability of necessary utilities and
infrastructure;
Policy Statements Specific to PostHarvest Interventions Cont…



The Ministry will emphasize on capacity building
for both technical staff and community;
The Government will introduce and promote
modern methods of agro-processing especially for
roots, tubers, fruits and vegetables to add value
and extend their shelf life;
The Government will ensure quality control and
standards
in
processing,
packaging
and
transportation of agricultural produce to ensure
smooth handling;
Policy Statements Specific to PostHarvest Interventions Cont…



The Government will facilitate availability of credit
facilities involving private sector and NGOs;
The Government will strive to develop modalities to
enhance competitiveness of locally processed
agro-products;
The Government will encourage the production,
importation and distribution of appropriate
machinery and other facilities for agro-processing.
The Land Policy


The national land policy promotes and ensures a
secure land tenure system and encourages optimal
use of land resources.
It identifies three categories of land i.e.
–
–
–
Village /customary land;
Public/Gazette land (i.e. national parks, forest reserves)
and
General land. General land is land that does not fall in the
above two categories, this is the land available for private
investors, that can be acquired for private enterprise
development.
The Cooperative Policy

The Cooperative Policy provides the
framework for the restructured co-operatives
– to operate on an independent, voluntary and
economically viable basis and
– to develop centres for providing and
disseminating agricultural inputs,
implements, technologies and information.
Agricultural Policy Formulation
Process

The Policy Unit in MAFS takes the lead in
the formulation process by inviting the
participation of all its technical departments
to review respective policy statements
Agricultural Policy Formulation
Process Cont…



Then the technical departments are instructed
to review the agricultural policy and
Provide a brief explanation of the current
situation, important issues and challenges
pertaining to their areas of jurisdiction
Relating to the current situation, issues and
challenges, the departments are required to
propose necessary improvements/alternative
policy statements
Agricultural Policy Formulation
Process Cont…


Each of the departments presents the
proposed policy changes at a policy review
workshop normally organized by the Policy and
Planning Department of MAFS
Then the proposed changes are subjected to
discussion and deliberations incorporated in
the draft revised agricultural policy
Agricultural Policy Formulation
Process Cont…


The draft policy is then discussed in a
stakeholders’ workshop which includes
representatives from farming communities,
inputs suppliers, financial institutions,
cooperatives and marketing, traders, district
agricultural officers, ministry of finance and the
POPP.
The workshop deliberations are incorporated
and a second draft of the policy is produced
Agricultural Policy Formulation
Process Cont…


The draft is then subjected to normal approval
process by submitting it to the Interministerial
Coordination Committee.
Thereafter the draft is discussed in the National
Steering Committee before it is approved as a
Government Policy-the Agricultural Policy.
Implementation of the Policy

The Agricultural Policy is interpreted and
implemented through:
–
–

Strategies
programmes and projects
The main strategy is the Agricultural Sector
Development Strategy, which was formulated in
2001 taking into account of the Agricultural and
Livestock Development Policy of 1997 and the
Cooperative Policy of 2000.
Implementation of the Policy cont…


The ASDS focuses on agricultural productivity and
profitability, the promotion of private sector/public
sector and process/contract grower partnerships.
In the ASDS, priority issues include:
–
–
Strengthening the institutional framework for managing
agricultural development in the country.
Increased private sector participation through creation of
a favourable climate for commercial activities
Implementation of the Policy cont…
–
–
–
Clarifying public and private roles in improving
support services (research and extension,
training, regulation, information and technical
services and finance).
Improving the inputs and output marketing
systems.
Mainstreaming the planning for agricultural
development in other sectors (crosscutting
issues such as rural infrastructure development,
the impact of HIV/AIDS and malaria, youth
migration and environmental management).
Implementation of the Policy cont…


Another important strategy that implements the
agricultural policy is the Rural Development
Policy
The Rural Development Strategy provides a
strategic framework that facilitates
implementation coordination of sector policies
and strategies concerned with the development
of the rural communities.
Implementation of the Policy cont…

Down below these strategies, the policy is
implemented through programmes and
projects such as the Agricultural Sector
Development Programme and the Participatory
Agriculture Development and Empowerment
Project (PADEP), the District Agriculture
Sector Investment Project (DASIP), Agriculture
Marketing Systems Development Project
(AMSDEP) etc
Implementation of the Policy cont…



The PADEP emphasizes on empowerment of the
farming communities through capacity building
and investment on community projects
The DASIP, like PADEP, emphasizes on capacity
building, investment on community projects and
promotion of rural financing and markets
AMSDEP concentrates on development of
sustainable marketing systems for both crop
commodities and livestock products.
Implementation of the Policy cont…


The agricultural policy is also implemented
through the Local Government Reforms
Programme which outlines regulatory functions
of the lower government bodies and structures,
where it tackles the issues of good governance
and financing.
The programme also emphasizes on
decentralization by devolution.
Agricultural Policy Evaluation



No specific attempts have been done to
evaluate the impact of agricultural policy
The evaluation of policy is done only through
the process of evaluation of the agricultural
sector performance.
The evaluation of the policy requires
monitoring of policy implementation
accompanied with data collection
Agricultural Policy Evaluation
cont…

Such data is not collected. The data if available
could be used to:
– Assess the feasibility of the policy,
implementation costs, impact on budget
transfers (subsidy or trade policy-import/export
restrictions), efficiency gains, trade effects and
impact on government objectives.
– Assess the impact on investment policies
(research/extension/development of new
technologies and infrastructural development
(market roads)
Agricultural Policy Evaluation
cont…
–
–
Correct market failures (lack of market
information, monopoly, fewer buyers or sellers,
shortage of labour, shortage of credit,land etc)
Identify the cost of production not reflected fully
in the market incentives (such as those areas
with limitations such as soil erosion and
environmental pollution etc) and should justify
the need for government interventions e.g.
imposing taxes, subsidies or regulatory control
Agricultural Policy Evaluation
cont…
Assess the impact of agricultural policy on the
private profitability ( difference of revenue and
costs) of agricultural systems and on the
efficiency of resource use.
As the policy evaluation is not done, a realistic
need for review of the policy is not justified except
for reasons of external pressures such as from
donors and other stakeholders
–
Assessment of the raised IssuesAgro Processing
Raised issues as presented in the agricultural
Policy under review include:
1.
Post harvest losses in Tanzania are estimated
to be 20-40% against the expected 2-3 %. The
most likely cause of this loss could be due to:

lack of proper storage
Inadequate knowledge on crop transportation and
handling
Lack of proper/efficient post harvest technologies
Absence of preservatives
Lack of processing equipment

Lack of credit etc




Assessment of the raised IssuesAgro Processing cont…
 If
these are the causes of the reported
losses, then further analysis to establish
the root cause could provide a hint on
what could be an appropriate policy shift.
 Should the root cause be lack of
knowledge in proper storage, shift toward
investment policy would be appropriate
i.e. investing in farmer training would be
desired.
Assessment of the raised IssuesAgro Processing cont…
However,
this must be subjected to
more tests on feasibility,
implementation costs, budget
transfer, efficiency losses, trade
effects and finally the impact on
government objectives.
Assessment of the raised IssuesAgro Processing cont…
 Should
the root cause be lack of credit,
the shift should be on promotion of
SACCOs.
 Again this should be further subjected to
the above stated tests to be able to come
up with a more realistic policy statement.
Assessment of the raised IssuesAgro Processing cont…
A
realistic policy would be formed based on
factors that influence or regulate
development of more sustainable and
efficient functioning SACCOs
 Factors that would influence increased
production would lead into increased income
and savings, hence more deposits in
SACCOs, which would in turn lead into more
loans for the post harvest technologies.
Assessment of the raised IssuesAgro Processing cont…
2.
Mechanical injury during handling and
transportation of fruits and vegetables is a
serious problem;


This is more related to the causes of reported
losses already discussed
The causes could be poor packaging, poor
roads, poor transportation facilities, absence of
packaging materials, absence of credit or lack
of knowledge/negligence etc.
Assessment of the raised IssuesAgro Processing cont…


All these causes would be summed up as farmer’s
ignorance in respect of working markets or lack of
necessary capital that is required for purchase of proper
packaging materials and transportation of quality
produce.
If ignorance is the problem, then the policy shift should be
on investment in training and if capital is the problem then
promotion of SACCOs would be appropriate, but these
should be formed based on demand and should meet
conditions for proper functioning of SACCOs.
Assessment of the raised IssuesAgro Processing cont…
Other raised issues include:
 Lack of quality standards in processing and
packaging of agricultural produce;
 Utilization of chemically produced products by
agro-processing factories instead of natural
agricultural produce;
 Small/medium scale processing centers suffer
huge loss due to erratic supplies;
Assessment of the raised IssuesAgro Processing cont…


Due
to
insufficient
demand,
weak
infrastructure,
poor
transportation
and
perishable nature of the crops, the grower
sustains substantial losses;
Inconsistent supply of vegetables and fruits to
the market, such that during rainy season there
is abundant supply and scarcity of the same
during dry season;
Assessment of the raised IssuesAgro Processing cont…


Locally processed products fail to compete with
imported products;
Unavailability of appropriate machinery and
technology.
Assessment of the raised IssuesAgro Processing cont…
These issues could be summed up as issues related
to conditions necessary for working markets.
Competitive markets would require stable supplies in
desired quality and quantity of the commodities as
well as presence of many buyers. Possible policy
shift would be on:
–
–
Investment on processing, packaging, storage,
transportation/distribution of the products
Investment on research and development of new/efficient
post-harvest technologies
Assessment of the raised IssuesAgro Processing cont…


Should the policy shift be on investment in
processing, packaging, storage and
transportation, the policy formulation
should consider the influencing
factors/incentives that would ensure perfect
competition in the course of processing,
packaging, storage and transportation.
Such incentives would include possible
subsidies, training, and regulatory control
to ensure quality products are produced
and reach the markets.
Assessment of the raised IssuesAgro Processing cont…

Such policies should be backed up by periodic
policy evaluation to assess their impacts on
rural incomes.
Assessment of the Proposed Policy
statements for Agro-Processing
(Policy under Review)


Before attempting to do the assessment of the
proposed policies in slides 10 through 12
above, better we define what a policy is as far
as agriculture is concerned.
Agriculture Policy should consist of decisions
that influence the level and stability of output
and input prices, public investments affecting
agricultural revenues and costs, and the
allocation of research funds to improve farming
and processing technology.
Assessment of the Proposed Policy
statements for Agro-Processing
(Policy under Review) cont…

This definition attempts to caution policy
makers that any statement made by the
government should be measured against
impact on:
– output and input prices,
– revenues and costs, and
– efficiency in the course of production,
processing and marketing
Proposed Policy statements for
Agro-Processing (Policy under Review) cont…


This definition justifies policy shifts to promotion
of the use of efficient technologies with
consideration of the impact on budget transfers
(subsidy or trade policy-import/ export restrictions)
and investment in public services (research and
extension,roads to markets etc)
Such policy shifts should consider:
– implementation costs, efficiency gains, trade
effects and impact on government objectives.
– Impact on investment policies
(research/extension/development of new
technologies and infrastructural development
(market roads)
Proposed Policy statements for
Agro-Processing (Policy under Review) cont…


By cross assessment of the proposed policy
statements (slides 10-12), the policy
statements emphasize on promotion of access
to capital (bullets 1,2 & 6), on training and
access to technologies (3&4) and on promotion
of competitive markets (5,7 & 8).
The policy statements assume that the target
farmers face the problems of shortage of
capital, need for capacity building and there is
lack of working markets
Proposed Policy statements for
Agro-Processing (Policy under Review) cont…


While the policy statements seem to be
appropriate, they are not formulated on the
basis of performance, efficiency and
implementability (formation of sustainable
production and marketing chains/systems)
These do not look into the effects of
implementation costs, efficiency gains, trade
effects and impact on government objectives.
Proposed Policy statements for
Agro-Processing (Policy under Review) cont…


The policy statements depict a picture of
supply driven economy rather than they would
be demand/market oriented economy.
Government policies should take the lead in
provision of public investments while creating
better environment that will promote private
sector involvement/investments. This calls for
policy shits to market economy.
Conclusion


Based on the above discussion, it appears that
the market forces have failed to support growth
of the required services and technology
development
As long as our main focus is the small farmer,
promotion of the use of post harvest
technologies has to reflect the situation under
the smallholder farming environment
Conclusion cont…

The environment of smallholder farming can be
explained as follows:
–
–
–
–
Partially integrated into markets
High degree of imperfection of the markets
which the small farmers confront
Multi-activity character of farmers- non-farm
activities some of which are non market tasks,
and some of which rely on working markets e.g.
crafts for sale
Small farmers societies participate in exchange
with the larger systems, and that small farm
productions are exposed to market forces
Conclusion cont…



Post harvest technology use will have impact
on smallholder households only if policies
provide measures to reduce market
imperfections under the smallholder farmers
Policies should be formulated as a result of
recommendations from impact assessment
and evaluation studies.
There is a significant shortfall of data and
information that hamper evaluation of policies
Conclusion cont…


Rural markets are imperfect, the prices of
goods or services will not reflect their true
scarcity value, hence policies should promote
services to remove this market imperfection.
Farmers must have good incomes before they
can sustain the use of technologies, including
post-harvest technologies, hence policy should
consider multidimensional characters of
agricultural production and market chains.
Recommendations


The inputs and outputs of small farms are subject
to valuation by the wider market at prevailing
prices, hence policies should take note of this fact.
Agricultural policy formulation/policy statements
for the post-harvest technologies should consider
examination of the:
– Microeconomic behavior of producers reflecting
the production and marketing chains
– Marketing and trade related to technologies
– Macroeconomic linkages
 Exchange rates, Wage rates and Interest rates
etc.
Recommendations cont…

Market failure develops when private sector is
unable to develop the institutions necessary for
efficient market functioning. Markets fail because
of:
– Lack of market information
– Small number of consumers/suppliers
influencing the prices
– Buyers or sellers having no other market outlets
– Existence of externalities influencing high cost
of production or low benefits from production
activities e.g. soil erosion, environmental
pollution etc
Recommendations cont…



Responding to the above findings, it is
recommended to engage the service of qualified
policy analyst to commission policy studies that
will lead into necessary/appropriate policy shifts
There is need to build the capacity of the staff who
are involved in policy formulation
Monitoring of the implementation of the policy is
necessary for prompting the need for policy
review.
Recommendations cont…

Monitoring and evaluation of policies should
receive adequate annual budget.
THE END