Session 5: Farm Productivity and Agricultural Development
The session was chaired and opened by Dr. Alemayehu Seyoum Taffesse, Country Director for IGC Ethiopia. Presenters were Professors Chris Udry, Tavneet Suri and Michael Carter. There were two discussants; Professors Rafael N. Uaiene and Shashidhatra Kolavalli.
The main focus of this session was to explore ways to increase farm productivity in Africa. Results of three field experiments, two focusing on farm productivity and one on agricultural input subsidies were presented all with long term policy insights.
The studies noted that agricultural productivity in Africa is generally low, with average yields not exceeding 20 kilograms per acre. This is a major concern as increased productivity is seen as a root to ending rural poverty on the continent. Low use of fertilisers and lack of innovative farm technologies are some of the contributing factors. Fertilisers in particular tend to be very expensive especially for rural farmers due to low population density and poor transport infrastructure, which means that farmers have to pay more than average per bag of fertiliser to get to the nearest fertiliser markets. While lack of access to credit by farmers is often viewed as a constraint, the researchers conclude that it may not be so, as availability alone does not improve farmer income because there are other factors at play. As a matter of fact in cases where credit is available, take-up is often low.
The role that technology is able to play in increasing productivity and improving nutrition was also demonstrated. A randomised controlled trial based in Sierra Leone also demonstrated how a new rice brand, known as the ‘New Rice for Africa’ (NERICA), is able to produce more yields of rice per acre in a much shorter period than ordinary rice. The early maturation of this brand of rice makes it possible for households to have an earlier than usual harvest in the middle of the planting season, also referred to as the ‘hungry’ season when food is in short supply, allowing households to have food and improving household nutrition. In a nutshell, this study is an excellent demonstration of what African farmers and the population at large can gain from the take up of modern farm technology which in turn could improve farm productivity, household incomes and livelihood. However, this will call for significant investments in research by African governments.
Lastly, farm input subsidies in Africa have become a common response to low farm productivity. Though initially intended to be temporal, they have become permanent, creating a permanent drain on national resources. For some African countries such as Malawi, the opportunity cost of subsidising inputs could be significant as their share of total agricultural budgets have been as high as 58% in some instances. While subsidies could be profitable and have positive effects that may persist for more than two years, African governments should invest in this particular area with a lot of caution. But since most countries are entrenched in subsidies the issue remains on how to withdraw them without jeopardising agricultural productivity and incomes especially in rural areas.
By Felix Mwenge, Country Economist, IGC Zambia