Workshop on Food Security, Economic Growth and Poverty Reduction by Don Mitchell USAID Feed the...
-
Upload
ami-stewart -
Category
Documents
-
view
215 -
download
1
Transcript of Workshop on Food Security, Economic Growth and Poverty Reduction by Don Mitchell USAID Feed the...
Workshop on Food Security, Economic Growth and Poverty
Reduction
by Don Mitchell USAID
Feed the Future Sera Project
Implemented by Booz Allen Hamilton
Presentation to Agr. Donor Working Group
June 21, 2012
USAID Feed the Future SERA Project
• SERA is the Policy Component of Feed the Future• Focused on improving the agricultural policies
through research to better understanding policy tradeoffs and options
• This activity looks at food security and the export ban• Presented to Government in Dodoma on June 16th
and all stakeholders at Kunduchi Beach on June 19th
Background on activity
• Concept Note to Government in October 2011 proposing three studies on Tanzania food security, economic growth and poverty reduction
• Process: Teams brought together in March• Regional Export Potential to 2025 (AIRD)• Economy-wide Impacts of Export Bans (IFPRI)• Food Security and Policy Options (USDA)• Impacts of Climate Change on Exports (World Bank)
G8 Summit in Washington in May
• Launched a New Alliance for Food and Nutrition Security between African nations, international donors and private firms
• The Government of Tanzania committed to pursuing policy goals to build investor confidence and investments in order to reduce poverty and end hunger
• Tanzania also committed to finding an alternative to the export ban on staple commodities used during food emergencies
Main Messages of Research
• Regional markets offers good export opportunities for maize and rice through at least 2025
• Tanzania will need to increase production and productivity to take advantage
• The export ban is not very effective and discourages investments
• Diets are changing and maize is no longer the only important food security crop
Main Messages continued
• Poor data is hampering analysis and decision making• New approaches to food security should be
considered• NFRA could be more effective if more focused on
providing food aid
Maize and Rice Regional Export Potential• The East Africa Region is expected to face growing
deficits of maize and rice through at least 2020 2009 2020– Maize Deficit (mil tons) 1.3 7.8– Rice Deficit (mil tons) 1.2 2.8
• Tanzanian Export Potential to 2020– Maize at 4% production growth net exports of .6 mil tons
at 5% production growth net exports of 1.6 mil tons– Rice at 7.3% production growth net exports of .17 mil tons
at 10.% production growth, net exports of 1.03 mil tons
Climate Change Could Benefit Maize Exports• World Bank study examines climate change models
and concludes that Tanzania will likely have increased rainfall in the future.
• Key African trading partners, including Mozambique, South Africa and Zimbabwe, will have lower rainfall.
• In addition, climate change will reduce the similarity of weather patterns between Tanzania and key trading partners.
Export Bans
• Discourage investments and reduce production• Not very effective in controlling inflation• Not very effective at limiting exports• Harm poorest farmers while benefiting weathiest
consumers• Have significant regional impacts• Institutionalized Export Permits which impede exports
Export bans have a modest effect on food prices
• Maize and maize flours account for 16% of consumer food spending.• Banning cross border maize exports lowers the national food price index by only
2.0-2.4 percent.
CPI Agr. CPI Food CPI
-3.5
-3.0
-2.5
-2.0
-1.5
-1.0
-0.5
0.0
Price indices, % change from free exports
2011 2017
Trend of Annual Inflation Rate 2011
13 14.116.8 17.9 19.2
14.817.4
21.322.8
24.7
10.8 10.2 11.4 12.2 12.6
5
10
15
20
25
July Aug Sep Oct NovAnnual Headline Food inflation RateNon Food Inflation Rate
Tanzania Maize and Rice Reported Exports
vs. Partner Reported Imports, 2011 (tons)
Tanzania Exports to:
Maize RiceReportedExports
ReportedImports
Reported Exports
Reported Imports
Uganda 30 254 7,743 27,338Rwanda 1,830 11,042 23,985 24,228Kenya 1,012 79,073 2,622 10,475Burundi - 4,719 155 5,877DRC 1 1 1,409 1,409Total 2,873 95,089 35,914 69,327
Exports are reported by Tanzania. Imports are reported by trade partner.
Export bans hurt rural poor and benefit urban rich
• Export bans benefit urban consumers at a cost to rural households
Note: Income quintiles (q1-q5) are defined according to per capita income at the national level. q1 represents the poorest 20% of households while q5 the richest 20% of households
q1 q2 q3 q4 q5 q1 q2 q3 q4 q5Rural Urban
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
Income effect by quintile, % change from free exports
2011 2017
Rural poverty population rises due to export bans (2017)
Note: A positive number indicates increased poverty in 2017, while a negative number means a fall in poverty.
Maize surplus region, rural Maize deficit region, ruralArusha 0Coast -8,139Iringa 32,000Dodoma -9,478
Kigoma 0Kagera -15,021
Mbeya 13,879Kilimanjaro 0
Morogoro 0Lindi 0
Manyara 40,792Mara 9,274
Rukwa 26,735Mtwara 0
Ruvuma -22,273Mwanza 0
Tanga 43,781Shinyanga 27,148 Singida 47,651 Tabora 23,819
Surplus rural total 134,915 Deficit rural total 75,254Rural total 210,169Urban total -48,624National total 161,544
The effect of export bans on maize producer prices differs across regions
• In the surplus regions maize producer prices are about 20-26% lower than the free export scenario• In the maize deficit regions, the price effect is modest. Maize producer prices decline by a modest
10-12%
Arush
a
Dodom
a
Iring
aKig
oma
Lind
iM
beya
Mtw
ara
Man
yara
Ruvum
a
Singi
da
Tanga
-30
-25
-20
-15
-10
-5
0
Maize regional producer price, % change from free exports
2011 2017
Maize Prices in Arusha, Mbeya and Nairobi
2007-01
2007-03
2007-05
2007-07
2007-09
2007-11
2008-01
2008-03
2008-05
2008-07
2008-09
2008-11
2009-01
2009-03
2009-05
2009-07
2009-09
2009-11
2010-01
2010-03
2010-05
2010-07
2010-09
2010-11
2011-01
2011-03
2011-05
2011-07
2011-09
2011-11
2012-01
2012-03
0
100
200
300
400
500
600
700
800
900
Maize Prices in Arusha, Mbeya and Nairobi, Tsh/Kg2007 - 2012
Arusha Mbeya Nairobi
March 2011
Requiring Export Permits discourages legal exports
• Exporters must travel to both regional and national capitals to obtain permits to export food
• Required even when no export ban because authorities expect it
• Leads to bribes and corruption• Severely constrains exporter’s business activities
according to recent TANEXA survey*
*TANEX 2012, Problems of Official Export Permits to EAC and SADAC: The case of Tanzania
Food Security – the focus on maize
• Maize is still the staple food crop and accounts for 40% of total calories and 16% of household expenditures
• However, there are large regional differences in calorie shares and household expenditures
• Rice and wheat account for 26% of calories in urban areas and 12% in rural areas
Calorie share of maize declines with income…
quintile 1 quintile 2 quintile 3 quintile 4 quintile 5 -
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
Beverages
Oil/fat
Milk
Meats
Fruits
Vegetables
Nuts, seeds and spices
Pulses
Sugars
Starches
Other grains
Rice
Maize and maize products
shar
e
Maize and Rice Production
• Method of estimation not rigorous and possibly biased
• Comparisons with Other Data:– Agricultural Census-Survey of 2002/03 and 2007/08– Household Budget and Consumption Survey of 2000/01 – Simulate consumption growth based on population and
income
• Conclusion - maize production is much higher than MAFC’s estimates and rice is lower
NFRA not very effective
• NFRA bought only 121,000 tons of maize in 2011/12 – about 6% of marketed maize production
• Buying price was well above market price which limited quantities that could be purchased and disrupted markets
• Lack of transparency disrupted private sector marketing
• Small farmers not able to benefit from NFRA higher prices
New approaches to dealing with food security• Conditional Cash Transfers
– Government to launch a Productive Social Safety Net Program that will provide cash and conditional cash transfers to low-income households
– Financed by World Bank Loan– If successful this could become the main way to deliver food
aid assistance
• Currently used in Rwanda, Ethiopia and Malawi
Conclusions
• Government committed to building investor confidence and finding alternatives to export ban
• Regional export opportunities are attractive• The export ban is not very effective• Broader definition of food is needed• Better data is essential• New approaches to food security are promising• NFRA could play a more important role in food
security