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Decision and Policy Analysis Research Area – DAPA

Domestic markets? or Export-orientated production? That is the question for Africa.

Over the past few weeks, French workers and students have been protesting about pension reforms, creating scenes of havoc across the country. Not so long ago, the residents of Maputo and Chimoio in Mozambique were rioting over a 30% increase in food prices.  Such extremes in the reasons to protest highlight the vast differences that exist between the developing and developed world. Overconsumption of food has become such a major problem in richer countries that it is unimaginable to see people rioting over basic staples. However, Mozambique’s case illustrates the urgency of food security, especially in Africa.

The nations of Africa, NGOs and private enterprise have in fact been discussing this issue. Last month, between 2-4 September, the African Green Revolution Forum (AGRF) took place in Ghana. The AGRF’s main aim is to increase agricultural productivity and create higher incomes for African farmers in a sustainable manner. A recent article in NGO News Africa has summarized some of the main conclusions of the forum.

There are a range of factors inhibiting a green revolution in Africa but according to the chairman of the AGRF, Kofi Annan, a lack of political will takes precedence. A major production-related constraint relates to low fertilizer use. NGO News Africa argues that the average expenditure on fertilizers in Africa is 8kg per hectare, compared to the approximately 30kg per hectare that studies show would be necessary for a green revolution.

The example of Malawi is particularly illustrative. During the 2002-05 period, grain reserves were depleted and the country was on the verge of starvation.  However, between 2005-06, the new government headed by President Bingu wa Mutharika launched a program granting subsidies for fertilizers and hybrid maize to smallholder farmers. The results were spectacular. By 2007, Malawi had achieved self-sufficiency and even had enough grains to export. Agricultural input subsidies are good short term measures but currently Malawi needs to move beyond its focus on fertilizers and seeds to ensure longterm food security for the future. For example, continued subsidies could add fiscal pressure to the Malawian government.  Furthermore, smallholder credit, farmer training, infrastructure programmes and procurement services are other essential elements that need to be emphasized in order to prevent long-term hunger issues.

What seems to be a highly contentious issue is the debate between domestic production and export-orientated agriculture. Africa has much fertile land that agribusinesses and countries are vouching to buy. On the other hand, food security is vital, and exporting food crops may seem unethical in a continent where 300 million people go hungry. Furthermore, relying on food aid (cheap subsidized produce from the developed world) requires already scarce foreign exchange and can increase dependency. Conversely, despite populist ‘anti-markets’ rhetoric, export chains have been critical to the development of rural economies in Africa and have increased incomes substantially in some countries. In Kenya, where a large number of smallholders participate in horticultural export production, households are able to spend more on food, education and health. Export crops in most cases offer much higher financial rewards than products for domestic markets.

In conclusion, the nations of Africa must find the right balance between domestic and export production. In countries where hunger is a major issue, the necessary steps must be taken to ensure long term food security (increasing fertilizer use, farmer training, improving infrastructure). In other cases where domestic food production is more stable, encouraging smallholders to actively participate in export chains can help alleviate rural poverty and raise household food budgets.

More on food security in future posts!

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