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Agricultural development in Sub-Saharan Africa

Mats HРµrsmar (editor)

Expert Group on Development Issues (EGDI)

2007

SARPN acknowledges the EGDI website as the source of this report: www.egdi.gov.se
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Introduction

This volume comprises the proceedings from a workshop on ”policy, poverty and agricultural development in Sub-Saharan Africa”, which was held at Frцsundavik, Sweden,in March 2006.The workshop was initiated and arranged by the Expert Group on Development Issues, which is linked to the Swedish Ministry for Foreign Affairs.

Sub-Saharan Africa is the only major region in the world where poverty is increasing rather than going down and where human development indicators tend to worsen. The region thus poses a major challenge to the achievement of the Millenium Development Goals by 2015. A major cause of this is the crisis in African agriculture, especially when it comes to the production of food staples, both for the rural population itself and for urban areas. Since the 1960s, agricultural output per capita remained stagnant and, in many places, declined. Africa is the only continent where cereal production per capita was less in 2001 than in 1961.

Over the years, considerable efforts have been made amongst researchers to analyse this crisis and its root causes (See for instance Kherallah et al., 2000; Djurfeldt et al., 2005; Inter Academy Council, 2004;Toulmin and Gueye, 2003; IDS, 2005). Recently, efforts have as well been made in the policy field.African governments have collectively engaged in the New Partnership for Africa’s Development (NEPAD). Under a special session of the FAO Regional Conference for Africa in Rome on 9 June 2002,the Comprehensive Africa Agriculture Development Programme (CAADP),was first endorsed at ministerial level by African Ministers assembled. It has since then been officially adopted by NEPAD organs as the framework for the sector’s development in Africa. The programme is meant to provide African governments, in collaboration with their development partners, with an opportunity for renewed and re-focused efforts to reverse decades of stagnating economic growth, low agricultural production and declining productivity, food insecurity and increased poverty in the region.

African governments have since then as well agreed to “adopt sound policies for agricultural and rural development, and committed themselves to allocating at least 10 percent of national budgetary resources for their implementation within five years” to the agricultural sector.This was declared in the Maputo Declaration on Agriculture and Food Security in Africa of July 2003. Heads of state and governments, participating in the African Union high-level meeting, signed the declaration.

In the donor community, for instance the World Bank and the European Commission have both made renewed efforts aimed at strengthening the agricultural and rural sectors, not least in their interventions in Sub-Saharan Africa. A number of bilateral donors have, in the framework of the OECD Development Assistance Committee,DAC, developed a common position paper (OECD, 2006).

In a parallel development, a number of OECD countries try to enhance their policy coherence for development. Sweden is amongst the frontrunners in this field, actively looking into issues such as coherence between its agricultural, trade and development policies.Hence, the issue of Sub-Saharan African agriculture is high on many policy agendas.

In this context it was deemed relevant to bring leading researchers and policymakers to a roundtable aimed at analysing binding constraints to the development of agriculture in Sub-Saharan Africa. The objective was to bring various perspectives together in order to not just understand the problems, but also to advice on how to act on them.

Every attempt at discussing “agriculture in Sub-Saharan Africa” is at the same time much too broad, as well as too narrow. Sub-Saharan Africa is not one homogenous unit and the diversity on this continent, in terms of agro-ecology, market conditions, policy frameworks and cultural characteristics, makes it very difficult to generalise about descriptions of problems, as well as about solutions.At the same time, agriculture may in many situations be too interlinked with other economic and cultural activities on the continent, as well as with economic and political conditions outside of it, to be meaningfully dealt with in isolation.

As shown by others (IDS Bulletin, 2005), agricultural development in Sub-Saharan Africa is dependent on a multitude of factors and the risk for oversimplification in dealing with it (“quick fixes”) is obvious. However, the approach chosen for this roundtable was to focus on productivity growth in the cultivation of food crops. This entry point enables an emphasis on what must be an essential component of every attempt at reducing poverty through agricultural development. At the same time, it allows for an analysis that brings in a vast number of primary and secondary factors,which all impact on agricultural growth and poverty reduction. The productivity entry point encompasses such diverse areas as public policies, human capabilities including health and education, the functioning of markets and institutions, other kinds of social relations as well as technology, and innovations.

This volume sets out with a discussion on the role of agriculture and food production in economic development in Sub-Saharan Africa more broadly. Peter Hazell argues that no other economic sector has the scale and potential to play the role of economic engine for the continent.Agriculture, and in particular food crop cultivation, is broadly spread over the continent, has considerable catch up potential, given the low levels of factor productivity, and has strong growth linkage effects, especially in the early phases of development. It may as well be a sector that is strongly pro-poor. The counter-argument is of course that agriculture has had a very bad track record in Sub-Saharan Africa, and that world market prices are very low. On the other hand, the manufacturing or the service sectors have not shown any better results. Hazell thereby dismisses the argument put forward by Collier (2006) about resource-scarce coastal economies adopting the East Asian development model of diversifying exports and harnessing the country’s endowment of abundant labour.According to Collier, land-locked countries could serve as labour resource pools, rather than develop as independent national economies.

Hazell’s argument is, as well, reinforced by recent research into the emerging role of China and India towards Sub-Saharan Africa: “Policies, such as emphasising the expansion of labour-intensive manufactured exports as a means for poverty reduction, may need to be qualified, in light of the increasing competition and falling prices for many such products, while vertical integration in resource-based industries will have to be supported increasingly”, (Chen et al., 2006, p. 70). Chen et al. also point to the important challenges that lie in promoting agricultural progress in Africa, both because African food production may be relatively more secure from Asian competition, and because the increased Chinese demand for food products opens up possibilities.

If it convincingly may be argued that agriculture has an important role to play for economic growth in Sub-Saharan Africa, how then should such agricultural development be brought about? This is the theme of the rest of the volume. Gueye takes a in his chapter a somewhat less aggregated perspective, as compared to Hazell. He discusses the role of family farming in West Africa, and he is in particular concerned with what measures African governments need to take for this sector to survive and hopefully also thrive.Policy messages for African governments come across in all the various chapters, and what emerges specifically from Gueye’s argument is first that the state has a very important role to play, and secondly the importance of supporting peasant and producer organisations. In situations of deregulation and liberalisation, such as those that have characterised many African countries during the last 10 to 20 years, a combination of government action and collective action from well-organised producer organisations may be what is needed to create and integrate markets. Governments have important roles to play in areas such as price policies, infrastructure investments, making vital information available, securing access to land, protecting natural resources and providing research and extension.However, without the active involvement of independent producer organisations, a development based on private initiatives will not be broadly based, and utilise the potential of the family farms.

The markets that governments are to encourage should provide small-scale farmers with market outlets and necessary production inputs.The social capital and trust needed for trade to take place over long distances, where personalised networks no longer suffice, need to be built or re-built. Conservatory power structures may need to be reformed, for markets of a more broadly inclusive character to evolve.There are as well essential gender aspects to take into consideration, not only in intra-household relationships (See for instance Ouйdraogo and Ouйdraogo, 1998, Yngstrцm, 1997 or Haddad et al, 1997), but also when it comes to market access more generally (Freidberg, 1997). In particular, many prevailing land tenure systems carry as well important gender implications concerning issues such as women’s inheritance rights, incentives for investments etc.

Another policy area where active involvement from African governments is needed concerns the role for research and technology as underpinning productivity increases in agriculture.According to Djurfeldt et al. (2005), there are important variations in food crop productivity at village level. A highly productive minority of cultivators reaches a substantially higher productivity than the majority, on the same kind of soils and under comparable conditions. The major difference has to do with access to assets. Hence, their perspective is greatly positive regarding what can be achieved if standard and adapted technologies may be utilised more broadly.

Jones describes, in his chapter, some of the most promising areas of new technology. Much progress has been made in the development of better-suited varieties of in particular cassava, banana tissue and rice.These new varieties have great potential since they are not demanding high inputs of fertilizer or irrigation, but may nevertheless contribute to substantially increased yields. In spite of these advances, and in spite of reports of increased yields where such varieties have been put to use, questions remain as to how new varieties may be put in production on a wider scale. Jones calls, in his chapter, for investments in new and better functioning innovation systems. Innovations need to link advancements in technology with the needs of users in the field, in an unbroken chain, and a network of interorganisational linkages need to evolve, he argues. The reason behind Africa’s low agricultural productivity is not any single factor, such as lack of finance, or lack of research skills, but rather the missing interaction between all involved actors. Hierarchical structures in current agricultural research organisations need to be opened up and decentralised, and multi-disciplinary, multi-stakeholder, multi-organisational systems of innovation need to be built, according to Jones.

Indigenous innovation has been a central feature of African agricultural development for a long period.However, indigenous innovations are mainly incremental, concerning things such as organisational and institutional changes, new seeds etc. They do seldom carry high income gains, which is why the importance of them is often overlooked (Ochieng, 2007, p 1f). Smallholder farmers are often the most significant innovators. In several communities, they account for as much as 90 percent of the seed needs (Kuyek, 2002). In spite of this, national agricultural research systems,NARS, are in most African countries modelled after what Rothwell (1994) calls the first generation innovation stage, implying that new technology is pushed onto the market, and farmers are perceived as the end users of this new technology. Donors have been pushing towards the second generation innovation stage, where focus is on market, or demand, pull. This reorientation has implied that most National Agricultural Research Institutes have created departments charged with issues of market orientation, under the labels of “postharvest” or “socio-economic” issues. However, not much has so far been done to move towards the 3rd, 4th or 5th generation innovation stages, which would imply the linking of push and pull, the integration of market and R&D activities with strong supplier and customer linkages, or broad networking activities to take place. Jones is obviously pushing for an evolution towards such more integrated models for innovation systems.

In making claims about innovation systems and its functioning, Jones adheres to the view that agricultural skill formation is not only a technological, but also a social process. Social networks can contribute to an increasing rate of technology diffusion. Such positions have earlier been reinforced by the work of Rogers (1995) and Rogers and Svenning (1969) who claim the importance of establishing close enough linkages between innovators, changes agents and subsequently also end users in local societies for new technology to be adopted. New knowledge may not be diffused without the presence of “social carriers of technique” (Edquist and Edqvist, 1979).

By arguing along these lines, Jones indirectly links the issue of technological advances with the issue of the functioning of institutions more widely. Institutions should in this setting be understood as “rules of the game”, building on the work of North (1990).At the centre stage are institutions that affect the economic behaviour of food crop producers in Sub-Saharan Africa. Much of these would tend to be indigenous, or social, non-formal institutions, which may or may not be conducive of the development of markets.

There are at least two possible reasons why indigenous institutions may be of particular importance in African agriculture. First: since African states generally have lower capacities, informal norms, regulations and organisations tend to prevail in areas, which in industrialised countries tend to be regulated by law, and enforced by government structures (property rights enforcement, social security). Second: since rural Africa is characterised by low population density, sparse infrastructure and its societies structured along customary lines (Mamdani, 1996), it is likely that social norms in these areas are more resilient to economic and social changes, as compared to other settings. Further, under the social and agro-ecological conditions characterised by high vulnerabilities and risks prevailing in many parts of Sub-Saharan Africa, it is not surprising that indigenous institutions in rural Africa are guided by the principles of survival and equality (de Laiglesia, 2006).

Norms and practices aimed at ensuring the survival of a society and all of its members, often take the form of risk sharing. However, such equalitarian norms may as well considerably impact on economic behaviour outside the area of risk sharing – either by creating adverse incentives, or by affecting the formation of preference structures.

An emerging literature in this field is pointing to the possibility that in particular indigenous institutions may serve as bottlenecks for agricultural development in Sub-Saharan Africa (de Laiglesia, 2006; Hеrsmar, 2004; Elbers et al, 2005). The question of institutional change comes to the forefront. What causes institutions to change is a highly contested issue. The difference in positions has part of its roots in diverging perspectives on the historical foundation of institutions. One attempt to better structure this debate is to make a distinction between “slow-moving” and “fast-moving” institutions (de Laiglesia, 2006). Slow-moving institutions comprise social norms and culturally induced practices, whereas fastmoving institutions are to be found in the domain of legal and political systems. However, fast-moving institutions are still circumscribed by the set of slowmoving institutions that prevail in a society.

After a thorough discussion on institutions and their roles, Gabre-Madhin identifies a number of challenges when it comes to “getting institutions right” in African agriculture:

  • The need for mechanisms to transparently grade and standardize products for market, from the production level on throughout the market chain;
  • The need for market information that is accessible to all market actors;
  • The need to foster competitive practices among all market actors, across all levels of the chain;
  • The need for financial markets to respond to market needs for trade finance, for inventory finance, and for alternative financial products;
  • The need for dispute settlement and regulatory systems to evolve according to market needs, and in a way that relies also on the private incentives for self-regulation, notably through the potential role of trade associations;
  • The need for risk-transfer through mechanisms such as forward contracts and transferable warehouse receipts, and,
  • The need for concerted efforts to build capacity throughout the marketing system, including cooperatives, small and medium private traders, and public actors.
In her view, what is needed is to perceive of market development as an integrated whole, rather than as the sum of piecemeal interventions. One possibility to promote such holistic approaches could be to start develop commodity exchanges. These may be understood as organized marketplaces, where seller and buyers interact, and where rules concerning the challenges above are formed. Such an illustration indicates that there are important roles both for private actors and for the state. What has hitherto been donor-driven, short-term and value chain oriented approaches to market development, needs to be replaced by longer-term, stateled efforts at market building. Further, the state needs to take all the three “I:s” – Institutions, Infrastructure and Incentives – into consideration, argues Gabre- Madhin.

By adding elements of technology, support to farmers’ organizations and the building of institutions and markets, a comprehensive program for African governments in the field of agricultural development is emerging. However, such efforts may still be in vain, it the overall global situation for agricultural trade is not changed.Werth analyses, in his chapter, what distortions international trading conditions impose upon agriculture in Sub-Saharan Africa. Even if net effects of increased world market prices on African food security is difficult to discern, there are still good reasons why the OECD countries ought to abandon their export subsidies (primarily the EU) and their export credits (primarily the US). Further, OECD countries should substantially lower tariff protection, including tariff peaks and tariff escalation, as well as their non-tariff barriers.

More controversial than such trade promoting recommendations may be Werth’s argument that the “policy space” available for African governments need to increase.Without true ownership of reforms by African governments, reforms will not be meaningfully or consistently applied. Policy conditionality, as we have known it for some decades, has reached a dead-end. Hence, OECD countries are advised to stop force and lock-in open market reforms through multilateral organizations such as the WTO, or bilateral trade agreements, such as the EPA:s. Rather, domestically driven development and trade agendas ought to be supported. Such support should as well include efforts aimed at increasing agricultural productivity and production in Sub-Saharan Africa, according to Werth.

The message emerging from this volume is that a combination of interventions in many different policy areas would be needed to raise productivity in Sub- Saharan African agriculture. Such a coherent approach would arguably also need to take issues concerning water and natural resource shortages, as well as the long-term provisioning of ecosystem services, into consideration. It should as well also thoroughly analyse and find ways to deal with the devastating effects on the labour force and on reproductive strategies that HIV/Aids causes.

A common thread throughout the volume is the important role that the state has to play in promoting agricultural development in Sub-Saharan Africa. This role differs substantially from the role African states used to play during the period 1960 until the 1980s. Some of the “new” tasks concerns mainly regulation, setting of norms and standards and organisation. However, much is also a matter of resources, which of course asks the question whether African states actually have the capability to implement what may be expected from them.

Another challenge raised in debates at the workshop itself, and as well in following discussions, was the question why such an agenda as proposed by the workshop, would stand any chance of being implemented.Are preconditions any different today, as compared to the 1970s, when the integrated rural development – agenda was pursued? In order to take this debate further, another workshop was arranged in June 2006. Proceedings from that workshop will serve as the concluding section of this volume.



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