Strategy options for the maize and fertiliser sectors of Eastern and Southern Africa

There is a global consensus that there is an urgent need for a “big push” agricultural strategy for Africa, acoording to this presentation given at DFID in July 2005. However, there is significant disagreement about how this should be accomplished, particularly with regard to food price support, price stabilisation, and input subsidies. African smallholder agriculture faces certain decline if current trends are not reversed by such a strategy.The presentation begins by highlighting the similar characteristics of smallholders throughout southern and eastern Africa, before discussing the arguments for and against agricultural price stabilisation and subsidy. Arguments in favour of price support include the contribution to market failure as a result of a weak private sector, and the fact that high food prices can exacerbate hunger. Reasons against are that it can be an extremely expensive measure, and that as little as 20% of smallholder farmers actually sell produce. The support of fertiliser programmes produces similarly polarised opinions: it is an incentive to intensify production, and could lead to greater structural transformations, but it is costly and can disproportionately benefit more wealthy farmers.The article comments that the general market performance in southern and eastern Africa over the last 15 yeas has been lacklustre. A contributing factor in this has been a mixed policy environment of both legalised private trade as well as intensive government intervention in the market. Marketing boards continue to play a strong role in food markets, and there are large-scale input subsidies in Malawi and Zambia. The challenge offered by the paper then is: how do we promote the labour productivity of small farms? This is placed in the context of increasing urbanisation, shifting food consumption patterns, and a growing reliance on non-domestically sourced staples. Recommendations put forward by the paper are:a new policy focus on public goods support for market development, such as research and development and extension servicesa more forceful lobby on international trade issues- emphasising agricultural subsidies in developed countries and a reassessment of agricultural ‘dumping’ policiesgovernments should not be ‘removed’ from markets, but their role should shift from direct intervention to supportive investments. These could include support for farmer organisations and the creation of a stable and predictable policy environment.