Transcript Methodology for preparing national cotton strategies in Africa

Methodology for preparing
national cotton strategies in
Africa
Alexander Sarris
Director, Commodities and Trade Division
Food and Agriculture Organization of the United
Nations
Presentation to the EU-Africa Cotton Forum, Paris
5-6 July, 2004
Overview. Elements of national
cotton strategies in Africa
• Prospects of international markets for African
cotton
• Cotton in the national development strategies
• Organization of national cotton sectors
• Technological innovation and adaptation
• Vertical diversification, quality assurance and
recognition
• Process for strategy formulation
Prospects of international markets
for African cotton
• Medium term world market prospects and
opportunities and competition from other
producing countries
• Domestic and trade policies of major
producing and trading countries.
• Competition from synthetic fibers
• Comparative advantages of African cotton
under current and medium term world market
developments.
Cotton in the national development
strategies and PRSPs
• Is there a need for a new or modified national cotton sector
strategy?
• Period for application of national cotton strategy
• Cotton’s role in the macro and rural economies
• The contribution of cotton to foreign exchange earnings and
domestic public resources. Taxation and subsidy issues
• Role of cotton in the growth process of the African economies.
Leading sector? Backward and forward linkages.
• Cotton employment, incomes and relation to poverty
alleviation.
• Prospects of domestic markets for African cotton, in light of
industrialization and growth strategies.
• Cotton and environmental issues
Organization of national cotton sectors
1. Organization of production
• Farmers organization and capacity to participate in cotton
sector institutions and policy formulation
• Role of cotton in farmer incomes and household income
growth strategies.
• Farmers’ response to market signals. Adaptation of
technological innovations.
• Requirements of farmers for more efficient production.
• Needs and institutions for forward cotton pricing.
• Capacity of farmers to insure against cotton and other
agriculture related risks, and their needs for safety nets.
• Organization (public,private) of the provision of essential
producer services (inputs, credit, seeds, research, extension)
Organization of national cotton sectors (2)
2. Organization of marketing and ginning
• Economies of scale in different parts of marketing chain and the need to
regulate entry under a liberalized environment. Rules and incentives for
foreign direct investment.
• Need and institutional arrangements to best combine input provision with
credit and output marketing
• What institutions can best provide productive inputs and essential producer
services (research, extension)?
• Pricing systems, and risk bearing along the cotton chain. Payment systems
for farmers.
• Efficient systems for hedging cotton system risks, and risk sharing along
cotton value chain. Stabilization funds and market based commodity risk
management.
• Is there a need for a regional cotton exchange?
• Legal systems and institutions for enforcement of laws and agreements.
Technological innovation and adaptation
• Need for promotion of knowledge intensive, lower
input, sustainable production structures.
• Needs and systems for farmer training in integrated
production and pest management (IPPM) to improve
livelihoods and reduce environmentally dangerous
input use.
• Policies toward GM cotton
• Policies for cotton quality assurance and recognition
through universal cotton classification system
• Best institutional arrangements for research and
extension
Vertical diversification and value
addition
• Opportunities and requirements for the
promotion of national and regional value
added industries (seed cotton production, yarn
production, fabric manufacturing, finished
good processing).
• Policies for domestic and international
investments along the cotton value chain
Process to formulate sustainable cotton
sector strategies (1)
• Stakeholder consensus building and participation in
the definition of the problems, constraints, and areas
for improvement.
• Understanding the opportunities and needs of
different stakeholders at different points of the
commodity chain
• If strategy already in place what, if any, external and
internal conditions have changed in recent period,
that necessitate rethinking of strategy?
• Objective professional analysis of identified problems
and policy options.
Process to formulate sustainable cotton
sector strategies (2)
• Capacity building at national level to undertake
policy analysis and evaluation of options.
• Capacity building at producer association level to
organize and participate in policy dialog.
• Partnerships between national and international
institutions and technical experts from academia,
trade and industry.
• Stakeholder participation in review of policy options.
• Period needed for strategy formulation or
reformulation.
FAO is available and willing to help in
cotton strategy formulation
• Independent and impartial analysis and points of view.
• Rural and agricultural development and hunger reduction
major strategic thrusts of FAO
• Competence in several related technical areas
• Long experience and presence in all African countries.
• Long experience in technical cooperation with member
countries in all areas of FAO’s expertise
• Large capacity to implement technical and policy related
analysis and projects
• Extensive network of contacts and collaboration with technical
experts in many member countries
• Good collaborative relations with other major multilateral
agencies and NGOs