|
Wednesday, 22 August 2007
IMPROVED MARKETS
FOR AFRICAN FARMERS FOR POVERTY REDUCTION
Policy and Institutional effects on market
participation by smallholder rice farmers: case studies in Burkina Faso,
Mali and Niger
Ali Touré
-
Rice Policy and Market Development, WARDA
Rice sector contributes significantly to secure households with
regard to their food needs but also to the creation of employments and
income generation. The sector development and its evolution over the years
have been marked by various policies and approaches. These development
stages of the sector constitute nothing but the impact of the number of
factors such as the rice policies put in place. A collaborative
multi-country pilot study on policy and institutional arrangements effects
on irrigated rice production and commercialization was conducted by WARDA
and its country partners of Burkina Faso, Mali, and Niger. In-depth
surveys were carried out at both village and household levels to collect
qualitative and quantitative data on irrigated rice production,
commercialization, and irrigated schemes governance. A common critical
constrain cited by the producers in these countries is the
commercialization of their product and their inability to take advantage
of the market opportunities. Using village and household levels survey
data on irrigated rice production and commercialization, this paper
attempts to examine the impact of policy and institutional factors in
market participation by smallholder rice producers. A farm level supply
is estimated using the quantity of rice marketed as the dependant variable
and factors such as output and inputs price, and policy and institutional
variables as independent ones. The preliminary results indicate that most
significant explanatory variable is the average irrigated rice plot (Mali
and Niger) and total area of other crops grown by the producer.
Patterns of Restructuring Food Markets in South
Africa: The case of Fresh Produce Supply Chains
Davison
Chikazunga
-
University of Pretoria
The restructuring process of the food markets in South Africa is at
advanced stages of consolidation and the emergence dominance of few
supermarket chains expanding into non-traditional areas, through franchise
format stores and forecourt stores overtaking informal wet markets and
green grocers. The growth has been followed by consolidation of the
procurement system from a decentralised to a centralised procurement and
distribution mechanism replacing the wholesaling function of the National
Fresh Produce Markets. The growth in disposable income, population growth
and urbanization have fuelled the demand food outlets like supermarkets
which in turn fuels innovations and dynamic changes surrounding
supermarkets
Has Imported Rice Crowded-Out Domestic Rice
Production In Ghana? What Has Been The Role Of Policy?
Sam
Asuming-Brempong
-University of Ghana,
Legon
Commercial rice imports have accounted for approximately 61%, food
aid in rice accounted for about 2%, and domestic rice accounted for some
37% per annum of rice consumption in Ghana over the four years between
2000 and 2003. Compared to the 1990s, these figures show a gradual decline
in the share of local rice production in the total quantities of rice
consumed in the country. On the other hand, the proportion of food aid in
rice consumed has remained relatively constant over the period, while the
proportion of commercial imports has increased steadily. Using the
Engel-Granger residual-based co-integration test, a market integration
analysis was explored for imported rice and domestic rice which compared a
central market for imported rice and five key rice producing centres in
Ghana. In addition, the various policies that affected rice during the
period were analysed. The results of the co-integration analysis suggest
that there is no spatial market integration between the central market
price of imported rice and prices in the local markets. This implies that
the prices of imported rice in these local markets do not share common
properties or behaviour with prevailing price trends in the central
market, suggesting that markets for imported rice in Ghana are segmented,
and domestic policies have generally not favoured local rice production
Changing Face of the Agri-Food Market: A Farmers
Response and Possible Solutions from a Provincial Perspective
Bongiswa
Matoti
-Western
Cape Department of Agriculture, South Africa
The rise of supermarkets, together with large-scale food
manufacturers, has deeply transformed agri-food markets in many countries.
This expansion has been evident in South Africa as well. Increasing
attention has been and is being paid to the growth of supermarkets in
countries outside of North America and Europe. Numerous studies have been
carried out in developing countries, including South Africa. However,
these studies, while identifying the growth of supermarkets and the
changes in supply chains, notably downstream, that have been caused by
this growth, have made relatively little progress in documenting the
impacts at producer level and in identifying issues that need to be
addressed. There is a special need for studies on how farmers and
supporting agencies, especially public agencies should respond to adapt
their interventions to the new realities of supplying large retailers.
This is of importance for South Africa because of its unique policy
environment where the expansion of supermarkets is accelerating at the
time when transformation in the agricultural sector is the key with the
aim of integrating emerging farmers in the mainstream agri-food system.
This paper will follow a case study approach, looking at cases in the
fresh fruit and vegetables category, particularly in the Western Cape
Province. The paper will summarise the rapid rise of supermarkets in agri-food
systems in developing countries. Attention will then be drawn towards
characterising these trends in the South African context with a special
emphasis on farmer’s response and issues that need to be addressed.
Trade Liberalization in the South Africa Livestock
Industry: Implications for Rural Development
Oyewumi,
Olaniyi A.- University of the Free State and Markets and Economic
Research Centre (MERC)
Livestock farming is an
important facet of agriculture and livelihood in South Africa. It forms
the essence of rural agriculture contributing food, socio-economic
stability, employment and income. After the liberalization of the
agricultural sector and phasing out of past protection mechanisms South
Africa introduced a process of tariff reform. Furthermore, a system of
tariff rate quotas was introduced in compliance with WTO regulations.
A partial equilibrium comparative static model was used to investigate the
impact of further liberalization in the livestock industry of South
Africa, particularly in meat products using four policy scenarios.
Specific emphasis was given to the liberalization of the current TRQ
regime.
The implication of the results are that the development efforts by
government aimed at commercializing emerging commercial stock farming in
order to address equity and poverty may be slowed down considerably with
further trade liberalization; especially since substitution with other
agricultural enterprises are limited.
The conclusion is that the
expansion in current quotas might be a more proper policy directive than
reducing applied tariffs over the short to medium run to comply with trade
liberalization targets as well as WTO commitments. The reason for this is
that quota expansion brings about moderate changes in domestic prices of
livestock and meat products as compared to tariff reductions.
Competitiveness and Revealed Comparative Advantage in the SADC Maize
Industry
Emelly Mutambatsere - Cornell University
This paper evaluates
the production and trade trends for maize and maize products in southern
Africa, individual countries’ revealed comparative advantages in producing
these products, and the expected implications of freer trade in this
sector. The analysis employs mainly annual bilateral trade data for the
period 1996-2004, evaluated using comprehensive descriptive measures and
the Revealed Comparative Advantage index. Results indicate that at least
half of the countries in the SADC region are deficit producers of maize
and maize products, and that only South Africa is a net exporter of all
products considered. Substantial cross-hauling is observed, and the bulk
of locally produced products are traded regionally, with over 90% regional
bias for half of all positive trade, although specific opportunities for
increased regional trade also exist. Tariff protection generally lies
below rates observed elsewhere in the world for this sector; however, for
half of the region, consistent non-tariff measures also are maintained.
Regional competitiveness in production is restricted to a few countries
that possess the capacity to produce and export significant quantities;
and with the exception of those countries, the region as a whole lacks net
comparative advantage in maize and maize flour production by global
standards. These results suggest a need for concurrent policy
interventions to improve production, regional and international trade.
Food security strategies focusing solely on improving regional trade,
while beneficial to specific regional producers, are unlikely to produce
major food security benefits.
Agricultural Value Chain Development in West Africa – Methodological
framework and case study of mango in Benin
Cathelijne Van Melle
–
IITA, Benin
Globalization and competitiveness of agricultural commodities could have
significant potential benefits for food security and poverty reduction in
West Africa. Participation in global trade and economy is potentially
important but not enough to ensure benefits at all levels of the chains
and equitable distribution of income for each participant. Efficiency is
key in the commodity value chain, but effective support functions and
services, infrastructure, legal and policy environment are important. This
paper presents the
framework of value chain concept and analysis, as a guide to enhance
competitiveness of commodities at national, regional or global level. The
paper applies the value chain
framework to a case study on mango in Benin, West Africa. The
international market for mango is characterized by stringent quality
requirements regarding fruit flies. This needs to be addressed as a key
value chain challenge for competitiveness of the commodity in Benin and
West Africa.
Cereal Price Instability in Ethiopia: An Examination of sources and Policy
Options?
Rashid, Shahidur -
International Food Policy
Research Institute (IFPRI)
Managing food price instability is a long standing policy
challenge, which, with mixed experiences of agricultural price policy
reforms, has re-emerged as a contemporary policy issue. This is
particularly true for Ethiopia, where managing food price stability
continues to be a formidable policy challenge. The objective of this paper
is to examine the underlying causes of cereal price instabilities and to
assess the policy options to manage them. It undertakes three tasks: (a)
analyzes the sources and degree of cereal price instability, (b) discusses
the viability of various policy options, and (c) critically reviews the
country’s past, ongoing, and emerging policies for food price
stabilization. The results show that the determinants of price
stability—infrastructure, information, and institutions—are at low levels
of development; both production and price variability are high, and
despite this continued high variability in prices, price risks mitigation
has lost its importance in the country’s policy agenda. By analyzing
market-based and non market-based policy options, as well as recent trends
in the cereal markets, the paper argues and concludes that reliance on any
single option may not produce the expected results. A combination of the
two will be desirable, especially in the short run.
ADVANCING
TECHNICAL CHANGE IN AFRICAN AGRICULTURE: PUBLIC POLICY ISSUES AND
STRATEGIC CHOICES
Gendered Impact of Nerica Adoption on Farmers’ Production and Income in
Central Benin
Rita Afiavi Agboh-Noameshie
-WARDA
Today, development and dissemination of new technologies constitute an
important strategy for agricultural intensification, poverty reduction and
food security in developing countries. Rice is an important source of
farmers’ income and foreign currencies in developing countries. Although
women play a vital role in rice production, they have not been adequately
involved in technology generation activities until recently. The New Rices
for Africa (NERICA) were developed by Africa Rice Center (WARDA) in 1994
and disseminated starting in 1997 in some Sub-Saharan African countries
including Benin in collaboration with National Agricultural Partners. This
paper use econometric method based on Local Average Treatment effect
(LATE) to estimate the gendered impact of NERICA adoption on farmers’
yield and income. The results show that NERICA adoption has positive and
significant impact on farmers’ yield and income. The impacts of NERICA
adoption are higher within women farmers than within men farmers
Financing
Agricultural Inputs in Northern Togo through Inventory Credit System: An
Economic Analysis of Institutional Response
Abdou
Konlambigue-International Center for Soil Fertility and
Agricultural Development (IFDC)
Agricultural intensification is widely seen as a condition
sine-qua-non for enhanced food security and as a major driver for overall
economic growth in sub-Saharan Africa (SSA). In this process, the
financial system has an important role to play, especially to finance
agricultural inputs. However in SSA, the financial institutions initiated
by governments and donors have in general not lived up to the
expectations, in particular not for the agricultural sector, because of
inappropriate design and weaknesses in implementation. Even the
microfinance institutions which were supposed to support the small-scale
farmers have deflected for their goals due to the risks that the
agricultural sector represents. To date, the economic research tends to
concentrate on the mechanisms that secure the credit of microfinance
institutions. However, the effective implementation of new mechanisms to
secure credit appears more difficult than foreseen, as the decision making
processes involved are complex and constrained by the lack of information.
This paper argues that sustainable agricultural financing needs
alternative schemes that secure both the credit of financial institutions
and farmers’ income. It will also be shown how the new institutional
economics perspective can be used to analyze and guide decision-making
with respect to alternative schemes for agricultural financing. This paper
which is based on quantitative and qualitative data presents the case of
the inventory credit scheme on maize to facilitate access to agricultural
inputs in Savannah region of Togo. In conclusion, some research areas will
be indicated to improve our understanding of the inventory credit system.
Smallholder Agricultural Surplus and Input Use under Transactions Costs:
The Case of Maize Supply and Fertilizer Demand in Kenya
Alene D. Arega -International Institute of Tropical Agriculture (IITA)
This paper assessed the effects of transactions costs—relative to
price and non-price factors—on smallholder marketed surplus and input use
in Kenya. A selectivity model was used that accounts not only for the
effects of fixed and variable transactions costs but also for the role of
assets, technology, and support services in promoting input use and
generating a marketable surplus. Output supply and input demand responses
to changes in transactions costs and price and non-price factors were
estimated and decomposed into market entry and intensity. The results
showed that while transactions costs indeed have significant negative
effects on market participation, cost-mitigating innovations—such as group
marketing—are also emerging to mitigate the costs of accessing markets.
Output price has no effect on output market entry and only provides
incentives for increased supply by sellers. On the other hand, both price
and non-price factors have significant influence on adoption and intensity
of input use. Overall, the findings suggest that policy options are
available other than price policies to promote input use and agricultural
surplus.
Risk Aversion and Sustainable Maize Production in Nigeria: Some Challenges
and Prospects for Agricultural and Economic Development
Luke O. Olarinde -Ladoke Akintola University of Technology
This paper determines the degree or extent of farmer’s risk
aversion that affects sustainable maize production in Northern Nigeria.
Using a ridge regression analysis, a measure of risk aversion was derived
for each individual farmer in a model of safety-first behaviour from a
cross-sectional survey of 350 maize producers in northern Nigeria. The
distribution of the degree of risk aversion shows a high skewness towards
the risk averters (high risk farmers) and centered around 1.20, and
standard deviation of 0.37. This distribution is then explained by a set
of specific variables that characterize the farmers’ behaviour in the
study area using a Tobit model. Susceptibility to risk was found to be
highly premised on the socioeconomic factors (e.g. age of household head),
farm specific variables (e.g. proportion of income from maize) and
farmers’ attitudinal factors against risk (e.g. safety first level of
probability of sale). These findings can be used to construct a framework
of development programs for peasant farmers, which provide some
challenging prospects.
Analysis of Factors Influencing Adoption of Dairy Technologies in Western
Kenya
Stella N. Makokha
-
Kenya Agricultural Research Institute
Indicators of poverty in western Kenya show high poverty levels. The area
has low dairy development yet the potential for dairy development is quite
high. Dairy farming has the potential to reduce poverty by increasing
incomes and reducing unemployment. This paper reports factor
interrelationships in dairy adoption with a view to understanding factors
that influence adoption. The binary probit model was used to analyse data
from 1575 households. Contrary to findings from similar studies elsewhere,
some factors had a negative association with adoption, thus unfolding a
unique adoption process. The association between the factor interactive
affects and technology adoption highlighted the importance of exploring
factor interrelationships. The widely held conclusion that smallholder
households are resource constrained in technology adoption did not hold in
this study. The source of labour supply dictated choice of variables to be
used as proxies for labour availability. The exploration of endogenous
relationships in the various factors dictated the use of the single probit
model. The spatial factors used were highly significant in adoption, and
the
predicted probabilities
from these factors gave a true spatial prediction. This confirmed
reliability of the probit estimates. An understanding of factor
interrelationships in adoption gives adoption studies high specificity
while making conclusions and recommendations, thus necessitating case
studies in adoption.
Impact assessment of Agricultural Research and
Development to reduce Virus problems in Tomato Production in Mali:
Farmers’
Perceptions
Nouhoheflin,
Theodore
-
IITA
Pests and diseases caused by bacteria, nematodes, fungi and viruses cause
significant losses to tomato in West Africa. This study, carried-out
within the framework of the IPM-CRSP implemented jointly by IITA, IER and
Virginia Tech. and State University, assesses farmers’ perceptions on
tomato pests and analyzes factors affecting pest management
decision-making. Surveys were carried out in three tomato production areas
where pests and diseases are major agricultural problems encountered by
farmers. Data were collected a sample of from 343 farmers through a set of
questionnaires on tomato production systems. Farmer’s decision-making in
pest management was modeled using an econometrics Logit probability model.
Results show that the main disease reported by most farmers is tomato leaf
curl viruses transmitted by whitefly (Bemissia tabaci). The spray
of chemicals was not effective on whitefly-transmitted viruses, but the
observance of host free period could significantly reduce the population
of whiteflies. Key factors affecting farmers’ pest management
decision-making are gender; share of tomato income from household income
and the level of farm income. Men are more involved in tomato production
due to access to pesticide and effective demand for pesticides because of
incomes (purchasing power). This paper concludes that tomato production
can increase significantly if improved varieties tolerant to whitefly
viruses are developed and disseminated, and farmers trained on the
appropriate use of chemicals using a participatory approach to raise their
level of awareness and information on effective pesticide use and
pest-management decision-making.
Did Farmers’
Livelihood Improve? An Impact Assessment of Incorporating Forages into the
Crop-Livestock System in the Coastal Savannah of Ghana
Godwin
Ameleke
-
CSIR-Animal
Research Institute
The study used programming methods to assess the farm-level impact
of incorporating forages, including dual purpose Cajanus cajan (C.
cajan), into the crop-livestock system in the Coastal Savannah
Zone of Ghana. The system was modeled in GAMS and solved using linear
programming. The optimal enterprise mixes and their resultant net revenues
with and without the interventions and therefore the change in net revenue
were obtained. The intervention was to grow forages as part of the
crop-livestock system and feed them to milking cows and their calves for
increased milk production and growth. The grain of the forage was used as
food by the farmers, and manure from the animals was also used for crop
production. The effect of policy options like educating farmers to
accept and use C. cajan grain as food and thereby increase its
production was analysed. The change in net revenue with incorporation of
C. cajan into the system was 50 percent. A 5 percentage points
change in the inclusion level of C. cajan grain in farmers’ diet
and subsequent increase in its cultivation precipitated a 4 percent change
in net revenue. C. cajan was not produced beyond the level required
for household consumption and its main attraction seemed to be its food
value. The addition of C. cajan into the crop-livestock system of
the area improved farmers’ incomes. Increased cultivation of C. cajan
may be dependent on the food value of the crop for the household.
The Impact of Access to Credit on the Adoption of Hybrid Maize in Malawi:
An Empirical Test of an Agricultural Household Model under Credit Market
Failure
Franklin Simtowe
- Bunda College of Agriculture
Guided by the frame work of a household model under credit market
failure, this paper aims at investigating the impact of access to credit
on the adoption of hybrid maize among households that vary in their credit
constraints. The data used in the study is from Malawi collected by the
International Food Policy Research Institute (IFPRI).Using the direct
elicitation approach; households are classified into constrained and
unconstrained regimes. The impact of access to credit is estimated using a
switching regression in a Double-Hurdle model. Results reveal that while
access to credit increases adoption among credit constrained households,
it has no effect among unconstrained households. Results also show that
factors that affect adoption among credit constrained households are
different from those that that affect adoption among unconstrained
household
THE ROLE OF
AGRICULTURE IN POVERTY REDUCTION: RECENT EXPERIENCES FROM AFRICA
Strategies to Promote Market-Oriented Smallholder Agriculture in
Developing Countries: A Case of Kenya
John Omiti – Kenya Institute of Public Policy Research & Analysis (KIPPRA)
Smallholder Agriculture is key to livelihoods of many rural households in
developing and transition economies. In Kenya, small farms account for
over 75% of total agricultural production and nearly 50% of the marketed
output. Despite favourable trends in global development drivers such as
rising population, per capita incomes and emerging urban dietary
preferences, most smallholder farmers remain poor. This study sought to
characterize agricultural commercialization trends, identify and
prioritize constraints to participation in markets, analyse determinants
of percentage of output sold, and explore strategies to promote
market-oriented production. A participatory Rapid Rural Appraisal
approach, household survey and a Truncated Regression model were used. A
sample of 224 farmers: 76 of them growing maize, 77 involved in
horticulture (kales and tomatoes) and 71 practising dairy, were
interviewed in one peri-urban and one rural district (Kiambu and Kisii,
respectively).
Results show that in rural areas, lower levels of output are sold
and fewer farmers participate in markets compared to the peri-urban areas.
Opportunities for profitable commercial agriculture are observed in
growing demand, emerging food preferences and intensive farming. At
village-level, market participation is hampered by poor quality and high
cost of inputs, high transportation costs, high market charges and
unreliable market information. At the household-level, the determinants of
percentage of output sold are producer prices, market information
arrangement, output, distance to the market, share of non-farm income and
gender. Strategies are suggested to improve rural input supply,
institutional and regulatory framework, enhance value addition and
strengthen market information provision.
Farmers’ Perceptions and Willingness to Pay for Metarhizium Anisopliae
Biopesticide Based to Control Cotton Bollworms in Benin (West Africa)
Adetonah Sounkoura,
- IITA
The study assesses
farmers’ perceptions and willingness to pay for a biopesticide developed
from Metarhizium anisopliae a fungi. A sample of 400 conventional
and organic cotton producers was
randomly selected in cotton producing zones in Benin and interviewed for
their perceptions on the efficacy of the biopesticide and the likely
prices they are willing to pay for the product to control a major pest
like Helicoverpa armigera or cotton bollworm causing substantial
crop losses. An econometric model (Logit) is used to identify factors
highly likely to affect farmer’s willingness to purchase the product. The
results show that Helicoverpa armigera or cotton bollworm is
perceived by farmers as the most severe pest with losses reaching up to
100%. Farmers attribute the current pest intensity to a number of factors
including ineffectiveness of chemical pesticides, delay in access to input
mainly fertilizers and the development of refuge host plants for cotton
pests. The results also show that most cotton producers and their
households members are exposed to chemical insecticides without adequate
protection devices during the pest control sprays. Both organic and
conventional cotton producers have expressed a significant interest in the
use of Metarhizium to control Helicoverpa on cotton. Both
types of
farmers willing to pay more for any pest control product that would
improve cotton product quality for higher cotton price. Three variables
influencing farmers’ willing to pay for biopesticides from Metarhizium
were efficacy, agro-ecological zone and broad spectrum.
Recent Developments in Rwandan Agriculture: The Challenges of Attaining
Food Security and Abolishing Absolute Poverty
Jose Ariyappillil Mathai - National University of Rwanda
The paper intends to take stock of the situation in the
agricultural sector of Rwanda. The main purpose is to identify the gaps in
the efforts so far; and subsequently to consider new policy interventions
that are needed to achieve the goal of eliminating the ‘Fear of Want’. The
sector’s performance is crucial in achieving the MDGs in the country.
Noteworthy is that the largest part of Rwandan population agriculture is a
livelihood and for the policy makers the sector is continuing to be a
development problem.
This paper analyzes the links between agriculture, food security and
poverty reduction in Rwanda based on available secondary data. It is done
in light of two important happenings in the country development scenario
after the completion of the reconstruction phase (after war and genocide)
of 1994-98. The first is related to the overall development strategy that
is followed by the country. Rwanda has set a clear strategy of development
in the form of VISION 2020 and also a programme for poverty reduction in
the form of PRSP. The second important
development was with respect to sector specific initiatives. Four
important initiatives merit mentioning- ‘The Strategy and Action Plan for
Food security’, ‘The National Agricultural Policy’, the ‘Strategic
Plan for Agricultural Transformation’ and the ‘Long-Term Framework for The
Implementation of The Comprehensive Africa Agriculture Development
Programme (CAADP) in Rwanda’.
All these plans
were framed for an exhaustive transformation of the agriculture sector so
as to bring about the necessary change that is needed to face the
challenges of abolishing absolute poverty and hunger.
The following hypothesis was framed to guide the analysis: a more productive and
profitable agricultural sector is the necessary component in meeting the
challenges of attaining food security and abolishing absolute poverty in
Rwanda. This hypothesis reflects Rwanda’s national perspective and
linked to the country’s development plans (PRSP and VISION
2020) and policies. Analysis enabled to oversee the hypothesis in
order to arrive at plausible conclusions related to Rwanda’s agricultural
sector performance during last six years (1999-2005). Some crucial areas
like cropping pattern, incentives, agricultural prices, public
distribution system, implementation of land reform measures etc needs the
right attention.
If the agricultural sceptics have their way, most Rwandans will face a
bleak future of worsening poverty and hunger.
Assessing Potential Impact of a Farmer Field School Training on Perennial
Crop in Cameroon
Njankoua Wandji Dieu ne - IITA
This study is an attempt of the combination of multiple data
sources referring to the same time period and to the same farmer
population, it aims at assessing the potential impact of a cocoa Farmer
Field School Training on Integrated Pest Management in Cameroon. Using a
combination of a latitudinal and a longitudinal comparison,
the results indicate that FFS-trained farmers have significantly more
knowledge about crop husbandry practices than those in the non-participant
comparison group. A 32% production increase and 45% income increase
relative to the non-participants was estimated in the latitudinal
analysis.
The longitudinal comparison is showing significant adoption rates of 94,
93, 90, 66 and 35 % respectively for shade management,
phytosanitary harvest, pruning, improved spraying practices and grafting
of improved materials. There was a 47 % reduction in the frequency of
spraying fungicides and a 17 % reduction in the number of sprayers applied
per treatment following the implementation of the training. Labour inputs
increased significantly for pruning, phytosanitary harvest, and shade
management but decreased for spraying. A partial budget
analysis reveals that the IPM practices lowered overall costs of
production by 11 % relative to previous practices. The two different
analytical tools (longitudinal and latitudinal) are convergent in their
results, showing more evidence about the higher potential impact of the
farmer field school training on the restructuring process of the cocoa
sector in Cameroon.
Impediments to Competitiveness of Small-and Medium-Scale Maize Milling
Enterprises in South Africa
Orefi Abu
-University of Pretoria, Pretoria
The maize milling industry is highly characterised by continuous
growth in maize milling and retailing margins in real terms (Traub and
Jayne, 2004) despite the benefits and opportunities brought about by the
deregulation of the South African maize market in 1997. This may be
indicative of the inability of small and medium-scale maize milling
enterprises (SMSMMEs) to emerge and compete with large-scale maize
millers. This paper examines the constraints faced by SMSMMEs in South
Africa. Data were collected with the aid of a structured questionnaire.
Millers were asked to identify the various challenges facing their
enterprises. Some key constraints identified were; high transport costs,
high maize prices, brand name establishment and government policies such
as the compulsory maize meal fortification regulation and high taxes.
Other perceived constraints included lack of adequate infrastructure,
storage facilities, access to credit and seasonality of maize grain.
The Distributional Effects of Horticultural Export Value Chains Among
Smallholders in Southern Ghana
Victor Afari-Sefa -
Center for Development Research, Bonn
Increasing foreign exchange problems and deteriorating prices of
traditional export commodities have led policy makers and donor agencies
to seek diversification in
export crop production. In Ghana, crops such as pineapples and mangoes
appear promising because of their high labour intensity and the expanding
demand for fruits in Europe. Notwithstanding, there is a possible
trade-off between export and food crop production because of the
possibility of resource re-allocation. So far the major concern of
government has been the macro-economic growth in terms export earnings
while the distributional effects and impacts on household food security
remain under-investigated. The study focused on a household survey
undertaken in the forest and coastal-savannah transition zones, where the
farming system has undergone a transition from established food-crop
farming for urban markets to an intensive production of horticultural
products for export. Logistic regression and a semi-log function were used
to estimate the determinants of household food availability and income
respectively. Results show that households engaged in export horticulture
are better-off than those which do not. Yet, the sole adoption of staple
or export crop is not a sufficient condition for improving household food
security. Household land endowment and income are fairly to strongly
unequally distributed, with higher inequality observed among households
engaged in the combined scenario. The paper concludes that linkages which
allow simultaneous and reliably access to a range of resources and
services – purchased farm inputs, symmetric market information and
technological know-how are critical if smallholders are to survive in
increasingly competitive global food markets.
Integrating poverty classes and economic surplus analysis the example of
BT maize in Kenya
Hugo De Groote - CIMMYT
In East and Southern Africa, maize is the major staple crop but its
yields have been stagnating and production cannot keep up with the
population growth. For agricultural research to contribute to poverty
alleviation, new technologies on the poor needs should be analyzed. In
this paper, we therefore integrate poverty analysis into economic surplus
analysis, and apply it to the example of Bt maize in Kenya. These
varieties are expected to control stem borers, a major maize pest, and the
economic surplus (ES) is calculated at US$ 22-54 million. Most of this
benefit, about two thirds, will go to consumers. The ES is further
attributed to different wealth categories and agroecological zones, using
indicators such as current crop loss from stem borers for the producers,
and maize consumed per household for the consumers. These indicators were
calculated using survey data from 1800 farmers, by wealth category. The
results indicate that the poor benefit only marginally from the producer
surplus, but are likely to receive substantial benefits from the consumer
surplus. Only 4% of producer surplus is expected to reach the poor farmer.
Poor farmers have little land and produce only 6% of all maize in the
country, although relatively more at the coast (31%) and in the moist
mid-altitudes (20%). Since poor households consume about 41% of the maize,
that proportion of consumer surplus is likely to go to them. In some
zones, like the coast, the poor consume a larger proportion of all maize.
Small producers, most of them net buyers, will mostly benefit through the
lower prices.
EXPANDING THE
FRONTIERS OF AGRICULTURAL ECONOMICS TO MEET THE CHALLENGES OF AGRICULTURAL
DEVELOPMENT IN ACHIEVING THE MILLENNIUM DEVELOPMENT GOALS
A Discriminant Analysis of Factors Associated With the Adoption of
Certified Organic Farming by Smallholder Farmers in Kwazulu-Natal, South
Africa
Maggie Kisaka-University
of KwaZulu-Natal
Discriminant analysis was used to identify the characteristics that
distinguish between fully-certified organic, partially-certified organic
and non-organic farmers in Umbumbulu district, KwaZulu-Natal (KZN), South
Africa (SA) during October- November 2004. 200 farmers interviewed were
drawn by purposively selecting the 151 members of the Ezemvelo Farmers’
Organisation (EFO), and by random sampling 49 non-organic farmers in wards
neighbouring EFO. Results from the two estimated discriminant functions
suggested that farmers with higher household sizes, incomes, input costs
per hectare and number of chickens owned, locations further from
innovators and less risk aversion were more likely to be certified as
organic. Household location should be considered in delineating target
domains for introducing new technologies especially where resources are
limited. There is a need for key stakeholders to increase smallholder’s
capacity to bear risk by decreasing the perceived risk of adoption of
certified organic farming
Evaluation de la diffusion et de l’adoption des variétés de riz NERICA en
Guinée
Sékou
Diawara
-ADRAO Cotonou
L’objectif de la présente étude est d’évaluer la diffusion et l’adoption
des variétés de riz NERICA en Guinée cinq années après leur introduction.
Les données collectées en 2002 sont relatives à 1535 paysans choisis dans
79 villages des quatre régions naturelles de la Guinée. L’approche
d’estimation du taux d’adoption utilisée dans ce papier se fonde sur les
théories modernes d’évaluation au niveau micro-économique des impacts
d’interventions politiques. Nos résultats montrent que 39% de la
population guinéenne connaissaient au moins une variété NERICA en 2001
avec 23% pour le taux d’adoption observé au sein de la population de
riziculteurs. Plusieurs facteurs socio-économiques déterminent les taux de
diffusion et d’adoption. Par ailleurs bien que le taux d’adoption ait
connu une croissance de 1996 à 2001, il est resté inférieur au taux
d’adoption potentiel (53%) si tous les paysans avaient accès aux semences
de NERICA en 2001. Des mesures méritent donc d’être prises pour une
meilleure diffusion des NERICA et surtout des NERICA bas-fond en Guinée.
Gender Contribution and Constrains To Rural Agriculture and Household Food
Security in Kenya: Case of Western Province
Joyce Omwoha
- Moi University
This study examined the contribution of gender with special
emphasis on women farmers towards rural agriculture as well as factors
constraining access to rural agricultural production and consequently
household food security in Western Province of Kenya. Data were collected
from a total of 161 women farmers, 32 women groups as well as 254
individual males farmers engaged in small-scale production of various food
crops in Western Province in Kenya for a period of 1 year. Data were
collected using questionnaires and interviews administered to the sampled
individual farmers and women groups. Outputs from individual farm
productions were used as a measure of agriculture production. Comparisons
were made between exclusively female owned farms, women groups and male
farms. Results indicated that farms owned exclusively by women did not
differ significantly (P>0.05) in agriculture production from those owned
by males. Farms owned by women groups performed much better and had higher
unit productions. Further results indicated that women had more obstacles
constraining their productivity in rural agriculture. 12 out of the 18
factors studied fitted the logistic regression model as constraints for
women in agricultural production compared to only five factors
constraining men. This study demonstrated that women could provide many
yardsticks to unlocking agricultural production in Kenya, which is
currently erroneously left to the domains of men. The study recommends
adoption of strategies such as formation of women cooperatives and
education to change the customary laws curtailing women roles in economic
development.
Measuring Irrigation Water Efficiency with a Stochastic Production
Frontier: An Application for Citrus Producing Farms in Tunisia
Boubaker Dhehibi -Institut National de la Recherche Agronomique de Tunisie
The objective
of this paper is to propose an alternative measure of irrigation water
efficiency based on the concept of input- specific technical efficiency,
which contracts with measures previously used in the literature. The
proposed methodology is applied to a randomly selected sample of 144
citrus growing farms located in Nabeul (Tunisia). A stochastic production
frontier approach, based on Battese and Coelli’s (1995) inefficiency
effect model, is used to obtain farm-specific estimates of technical and
irrigation water efficiency. In addition, a second-stage regression
approach is used to identify the factors influencing irrigation water
efficiency differentials across citrus growing farms. Results indicate
that technical efficiency ranges from a minimum of 12.9% to a maximum of
90.7% with an average estimate of 67.7%. This suggests that citrus
producers may increase their production by as much as 32.3% through more
efficient use of production inputs. Further, mean irrigation water
efficiency is found to be 53%, which is much lower than technical
efficiency and also exhibits greater variability ranging from 1.6% to
98.87%. The estimated mean irrigation water efficiency implies that the
observed quantity of marketable citrus could have been maintained by using
the observed values of other inputs while using 47.0% less of irrigation
water. Moreover, the estimated mean irrigation water technical cost
efficiency is found to be 70.81% indicating a potential decrease of 29.19%
in total cost by adjusting irrigation water to its efficient level. In
addition, the vast majority of farms have achieved irrigation water
technical cost efficiency greater than 90% (71% of farms). Finally, the
analysis of the sources of efficiency differentials among farmers showed
that farmer’s age, farm’s size, education level, agricultural training,
the share of productive trees and the water disposable perception tend to
affect positively the degree of both technical and irrigation water
efficiency.
Non-Credit Services of Group-Based Financial Institutions: Implications
for Smallholder Women Honey Income in Arid and Semi Arid Lands of Kenya
Peter Shimon Otieno - University of Nairobi
This paper analyses the effect of non-credit services of joint
liability credit institutions on smallholder women beekeepers’ honey
income. The non-credit services offered to the beekeepers are mainly
enterprise development services (training on marketing, business,
production and sub sector analysis). The study uses cross-sectional data
from a survey of women beekeepers participating in group-based credit
programmes done in September 2005 in Makueni district of Kenya. The
findings indicate that the number of enterprise development related
trainings attended by women beekeepers’ that are offered by the
group-based financial institutions positively and significantly influence
honey income. The results confirm that non-credit services contribute
positively to the enhancement of honey income. These results imply that
extension and strengthening of group-based financial institutions’
non-credit services in the marginal areas will enhance development of
smallholder agriculture for improved income generation.
Heterogeneous Impacts of Cooperatives on Smallholders’ Commercialization
Behavior: Evidence from Ethiopia
Tanguy Bernard -
IFPRI
This paper examines the impact of marketing cooperatives on
smallholder commercialization of cereals using detailed household data in
rural Ethiopia. We use the strong government role in promoting the
establishment of cooperatives to justify the use of propensity score
matching in order to compare households that are cooperative members to
similar households in comparable areas without cooperatives. The analysis
reveals that while cooperatives obtain higher prices for their members,
they are not associated with a significant increase in the overall share
of cereal production sold commercially by their members. However, these
average results hide considerable heterogeneity in the impact across
households. In particular, we find smaller farmers tend reduce their
marketed output as a result of higher prices, while the opposite is true
for larger farmers.
MEETING AFRICA’S
FOOD AND NUTRITION CHALLENGES
Household Food Security in a Subsistence Economy: Application of Translog
Cost Function to Cross-Sectional Data in Vihiga District, Kenya
Philip Nyangweso - Moi University
Vihiga, one of the poorest and densely populated districts in Kenya
is perpetually food deficit (GOK, 2005). While food demand continued to
rise, production fell behind both targeted production and district demand.
To make matters worse food deficit situation worsened over the last
decade. Rising population and competition for resources have curtailed
efforts to improve household food production in the district. Unfavorable
poverty indicators in the district only make matters worse. About 57.6
percent of the population and more than 50 percent of households live
below absolute poverty line while 57 percent of the population and
households live below food poverty line (GOK, 2005). Poor welfare
indicators for Vihiga district underscore the importance and urgency for
addressing its basic needs. Understanding determinants of food security in
Vihiga district will improve targeting, the focus and success of policies
for addressing food insecurity. The paper examines food security in a
subsistence economy with an application of a Translog cost function to
household survey data in Vihiga district to determine the supply side
constraints. Cluster sampling was used with divisions forming the main
clusters in the district. Using systematic random sampling, 50 households
were selected from each cluster resulting in a sample of 300. Results
show that scale of production, number of adults, household head, business
income, employment; human resource development, capital, and land size
significantly influence household food security. Food security programmes,
in subsistence economies, aimed at revamping production should focus more
on enhancing accessibility to production resources and improving the
quality of labor through training.
Giving a Chance to Indigenous Knowledge in Developing Sustainable
Nutrition Improvement Interventions
Kondwani Nanchukwa - Foundation for Irrigation and Sustainable Development
Malnutrition is one of the worst public health problems in Malawi. Results
of recent research indicate that 45.9% of under-five children in the
country are stunted, 3.3% are wasted, 19.4% are underweight, and almost
60% of child deaths are caused by malnutrition. There has been much effort
put in the fight against malnutrition; the government alone reports to
have spent about 1.5 billion United States Dollars in the fight against
malnutrition from 1992 to date. As if undermining all the efforts
involved, the country is said to have not recorded any significant
improvement in the nutritional indicators for the past three decades.
There have been a number of nutrition interventions running in Malawi. Why
they have not been able to eradicate malnutrition remains a million dollar
question in most people’s minds. In an effort to search for sustainable
solutions to the problem, a study was conducted in Group Village Head
Mgona and Tsekerere in Nsanje District in Malawi with an aim of finding
out how much local knowledge and other resources from within affected
populations would help in the fight against malnutrition. A study was
conducted in Nsanje district in Malawi to find out the potential of
locally available resources in coming up with sustainable nutrition
interventions. 60% of malnourished children had their nutrition states
improved within twelve days of feeding on locally available foods.
Food Drying-Production Plant
Maria Namuli Kasozi
-Tropical
Horticulture Enterprises (u) LTD
Tropical Horticulture Enterprises (T.H.E) is a Ugandan initiative
that works to add value to fruits, bananas and vegetables. The main out
put of this initiative are processed dried fruits, fresh fruits, banana
flour and fresh vegetables. T.H.E taps the 22% of banana and fruit loss at
farm gate due to failure to access markets timely, besides poor handling
knowledge and poor storage facilities in rural agricultural producing
areas in the country. The initiative boasts of linkage with farmers and it
has a bottom up network through which farmers have benefited in various
trainings. The main objective of this initiative is to improve farmer’s
incomes through providing an alternative avenue and market access to foods
produced and ferried to markets without any value addition. This
initiative adds value by way of preservation through sun drying of fruits
and bananas. It also vacuum packs fresh fruits and vegetables. The dried
bananas are milled into flour which provides an additional food variety to
maize flour and rice on the market for the above crops. It promotes
employment opportunities in the country due to multipliers effect, boosts
nutrition values and maintain food security in the country and the region
at large.
Investigating the Sources of Agricultural Growth in Africa: Factor
Accumulation, Total Factor Productivity, and Technology Absorption
Guy Blaise Nkamleu- IITA
This paper investigates sources and determinants of agricultural
growth in Africa, concentrating on the growth path during the last three
decades. The analysis employs the broader framework provided by empirical
growth literature and recent developments in Total Factor Productivity (TFP)
measurement to search for fundamental determinants of growth in African
agriculture. One main contribution and
new findings in this analysis is the quantification of the contribution of
the productivity growth and the contribution of different inputs such as
land, labor, tractor and fertilizer in the agricultural growth. Growth
accounting computation highlights the fact that factor accumulation rather
than TFP accounts for a large share of agricultural output growth and
fertilizer has been the most statistically important physical input
contributor to agricultural growth. The study also highlights the extent
to which agricultural growth contributors vary in relation with different
country conditions, institutions and politico-historical factors.
Designing Regional Systems of Biotechnology Regulation A Transaction Cost
Approach to Regulatory Governance
Regina Birner and Nicolas Linacre
Many developing countries are currently in the process of designing
regulatory systems that should make it possible to use the potential of
genetically modified organisms (GMOs) for agricultural development, while
at the same time managing the risks for food safety and the environment
that are potentially associated with these technologies. In view of the
considerable costs associated with biotechnology regulation and the
scarcity of biosafety specialists, there are processes in various regions
of the developing world to establish regional systems of biotechnology
regulation. So far, there are major knowledge gaps as to how regional
systems of biotechnology regulation can be designed to be effective and
efficient and to fulfill principles of good governance, such as
transparency, voice and accountability, control of corruption, and
avoidance of special interest capture. There is a wide variety of possible
regional approaches, which differ with regard to the level of
centralization, the scope of a regional system, the types of regional
institutions and processes, and the types of financing mechanisms. Based
on the literature on environmental and fiscal federalism and transaction
costs economics, the paper develops a conceptual framework for the
assessment of regional systems of biotechnology regulation. The framework
specifies design options and assessment criteria, and identifies major
trade-offs as well as the factors affecting these trade-offs. The paper
takes West Africa as an example to illustrate this framework and refers to
the European Union for comparison. The paper concludes that involving
regional experts, stakeholders and policy-makers into debates on the
design of a regional regulatory system is an important strategy to fill
knowledge gaps and arrive at conclusions regarding the trade-offs involved
in regional biotechnology regulation.
Food Security and Poverty of the Rural Households in Kwara State, Nigeria
Adewumi, Olaniyi Matthew -University of Ilorin
A fundamental challenge the world faces today is ensuring that
millions of households living in poverty have access to enough food to
maintain a healthy life. Africa over the years has been looking for ways
to solving the problem of food security and it is an important topic in
discussions of Africa leaders. While there are national data on food
security and poverty, information on rural food security and poverty are
not readily available especially in Nigeria. This study, therefore,
employed discriminant analysis to examine the levels and the major
determinants of food security and poverty among the rural households who
are the major producers of food in Nigeria. Using the basic calorie and
protein requirement per capita of households, our result revealed that
accessibility to health facilities; household size, farm size and
household expenditure on food were the major determinants of a household’s
food security status. Non-farm income was a major determinant of the
probability of a household being non-poor. The study suggests family
planning as well as specific programmes targeted at the rural poor and
food insecure as policy options.
AGRICULTURE, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT
Growth Acceleration and Structural Transformation: Ghana’s Options on the
Way to Middle-Income Status
Clemens Breisinger – IFPRI
Ghana has made considerable progress over the last 15 years in sustaining
economic growth and reducing poverty. While acknowledging the importance
of continued poverty reduction, the Government of Ghana has declared its
new development goal of reaching middle-income status by 2015. Achieving
this goal will require Ghana to double average per capita incomes from
their current level of US$450 to around US$1000 over the next decade. In
this paper we explore the growth experiences of other developing countries
that have successfully transformed their economies from situations similar
to Ghana’s today. Based on the past experiences of these fast growing
countries, we find that Ghana’s goal of doubling incomes in ten years is
not unprecedented. However, we find that other successful countries have
experienced significant structural changes during their transformation
periods. We use a dynamic general equilibrium model of Ghana to evaluate
sources of accelerated growth and their contributions to overall growth
and transformation. Model results indicate that Ghana’s current growth
path will leave the country’s economic structure unchanged, and that per
capita income will be about 40 percent higher in 2015. Growth must
therefore accelerate if incomes are to double. Based on the experience of
other developing countries, we consider the effects of a rapid
acceleration in manufacturing growth. Expanding Ghana’s manufacturing base
is found to help the country reduce its dependency on raw material
exports, such as cocoa and forestry products. However, Ghana’s industrial
structure constrains manufacturing-led transformation. Almost two-thirds
of current manufacturing is agriculture-related and its growth is
therefore limited by agricultural growth. Developing export-oriented
labor-intensive manufacturing that is not heavily dependent on agriculture
will be necessary for Ghana to expand manufacturing and reduce its
dependency on agriculture. Attracting foreign investment in these sectors
is key to Ghana achieving global competitiveness.
Striga management through herbicide resistance: the dream, the deployment
and the drama
Paul L. Woomer- FORMAT Kenya
Striga is an indigenous parasitic weed that attacks cereals and
other crops in Africa. In maize croplands alone, striga infests over 2.5
million ha resulting in 1.6 million tons of grain loss worth US $380
million annually. A biotechnological approach to controlling the parasite
was to induce herbicide resistance in maize and to coat the seed to
provide chemical protection from infection. This dream was realized after
12 years of collaborative research and development and now this technology
stands ready for deployment in Sub-Saharan Africa. This effort is most
advanced in Kenya, where the imazapyr-resistant (IR) maize hybrid Ua
Kayongo (Striga Killer) was tested by over 13,000 households and
registered for commercial release by Western Seed Company. Compared to a
currently recommended commercial hybrid (H513), Ua Kayongo improved
maize yields by 1022 kg ha-1, reduced striga expression by 81%
and increased farmer’s net return by $143 ha-1 (+63%). This
technology occupies a central role in the design of comprehensive
Eradication Initiatives but hindrance to achieving this goal has emerged
from unlikely sources. Crop breeders committed to developing alternative,
striga-immune varieties self-indulgently dismiss IR maize as a
technological dead-end while “green” interests unfairly label IR-maize a
GMO. A multinational corporation that produces imazapyr cleverly impedes
lower cost products and introduces marketing gimmicks that mislead
farmers. More accessible open-pollinated varieties are bypassed in favor
of expensive, double-cross hybrids. International centers accuse regional
and local cooperators of hijacking their achievement. Even donors that
financed the R&D phase, and hail IR maize as their technological
breakthrough, now shy away from funding its fuller deployment. It is
time to stop the drama and refocus all available resources upon assisting
striga’s victims in Africa.
Leveraging Institutions to Remedy Imperfect Markets and Improve Market
Opportunities for Smallholders
Bekele Shiferaw
In an effort to revitalize their economies and facilitate economic
growth, many sub-Saharan countries have liberalized markets and adopted
policies expected to open new market opportunities for smallholder
farmers. However, in areas with limited market infrastructure, market
imperfections continued to stifle private sector investments, leading to
disappointing outcomes for many farmers in marginal areas. High
transaction costs and coordination problems along the input and output
supply chains undermine market functions and performance. New kinds of
institutional arrangements are needed to cut these costs and fill the
vacuum left after withdrawal of governments. This paper analyses the
potential of market institutions and producer organizations in remedying
pervasive market failures in rural economies and strategies for developing
viable value chains for smallholders. Using a case study from semi-arid
Kenya, the paper shows that while collective action – embodied in Producer
Marketing Groups (PMGs) – is feasible and useful, external shocks and
structural constraints limit the volume of trade and access to capital and
information, suggesting the need for complementary institutions and
coordination mechanisms to expand and exploit scale economies. The
effectiveness of PMGs was determined by proximity to markets, the level of
collective action and participatory decision making. Failure to pay on
delivery, resulting from capital constraints, undermines the growth and
development of PMGs. These findings call for innovative interventions to
strengthen farmer organizations, including the governance and
participation of marketing groups and mechanisms for delivering essential
services (e.g., technology, credit, market information) for improving
competitiveness and managing risks for smallholder producers.
Perception de la Dégradation des Terres et Adoption des Technologies de
Conservation des Eaux et des Sols au Nord du Burkina Faso : le cas du Zaï
et des Cordons Pierreux
Modeste L. Kinané -Food and Agriculture Organization (FAO)
This study is based on data collected from 141 family-type farms in
the Yatenga province in Burkina Faso. A probit approach is used to analyze
the effect of perception of land degradation and other factors on the
adoption of zaï and stone rows. The results of the estimation show that
the availability of organic matter from small ruminants is determinant for
the adoption of both zaï and stone rows. Although most of farmers are
aware of the causes and consequences of land degradation, this factor does
not significantly impact on farmers’ decision to invest in SWC measures.
Opportunities do exist for making more efficient use of local sources of
nutrients, such as small ruminants’ organic matter in combination with
locally accepted SWC measures. This may increase farmers’ willingness to
go beyond SWC measures, to invest in nutrient supply in their soils which
are characterized by poor fertility. The study shows that combining
training on SWC and the development of small-scale animal breeding could
contribute to reach this goal in a degraded area.
Effects of EU Common Agricultural Policy Reforms on Eastern and Southern
Africa’s Trade with the EU under the EPAs
Protase N. Echessah -
Resource Centre for
Rural Development, Embassy of Sweden, Nairobi
Due to the size of the European Union’s agricultural production and its
market, the impact of the EU’s Common Agricultural Policy (CAP) reaches
far beyond Europe and has major implications for trade in agricultural
goods all over the world including the ESA region. Since the 1950s, the
CAP has undergone several reforms which have not only changed EU’s
agricultural support system drastically but has also impacted global
agricultural markets. For developing countries including the ESA ones,
these reforms have serious implications since they are particularly locked
into the EU’s complicated system of protectionist regulations and
subsidies on the one hand and preferential market access on the other
hand. The high degree of dependency and vulnerability of ESA agricultural
industries thus created makes it well worth having a closer look at the
changing patterns of the CAP and their impact on ESA agricultural markets.
Moreover, the impact of the CAP reform on ESA markets is likely to be
complicated by the introduction of free trade arrangement with the EU
through the Economic Partnership Agreements (EPAs) which are to become
effective on January 1 2008. A free trade agreement will reduce the scope
for the development of local value added food product industries serving
national, regional and EU markets and thus worsen ESA countries’ overall
terms of trade with the EU. It is this process of trade liberalization in
food and agricultural products in parallel with external effects of CAP
reform which raises concerns as ESA countries strive to structurally
transform their economies.
|
